2010 Legislative Session: Second Session, 39th Parliament
HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

official report of

Debates of the Legislative Assembly

(hansard)

Monday, April 26, 2010

Afternoon Sitting

Volume 15, Number 7

[ Page 4803 ]

MONDAY, APRIL 26, 2010

The House met at 1:34 p.m.

[Mr. Speaker in the chair.]

Routine Business

Introductions by Members

N. Macdonald: Mr. Speaker, it's a pleasure for me to introduce my belle-mère, which is a very nice French term for describing Betty Hoogendoorn. She's joining us here as well as my belle-soeur, Jean Persson. With them are my daughter Danielle and my wife, Karen.

If I am not heckling as loud as usual during QP, it's because…. I'm no less outraged by government answers. It's just that I want to be on my best behaviour today. That's what I'm aiming for. Please join me in welcoming them.

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R. Howard: With us in the House today is a good friend, a good supporter and a tireless worker, Mr. Amwar Sandhu. He's here with his entire family. I'm sorry I don't have all their names, or I'd introduce them as well, but would the House please join me in welcoming them here.

D. Hayer: We have a very special guest today, Russ Burtnick. He is a community leader. He is a past treasurer of Surrey Board of Trade, Surrey Chamber of Commerce, and he has served as a director on many community organizations. He's always helping anybody who needs his help in Surrey. He's a good friend, and he is one of the top Surrey residents. Would the House please make him very welcome.

D. Routley: I'd like to welcome to the House a friend of many on this side of the House, Darcy Olson, and her wonderful son, Alexander Morell. Darcy Olson's family have been involved with the NDP for a very long time. I think she refers to Ian Waddell as Uncle Ian.

They've come from Nanaimo — they're constituents from Nanaimo — to see how the House operates. Alexander isn't skipping school. He's on a pro-D day. He's here for his professional development, because everybody has every intention that one day he'll be walking these halls in one form or another. So please help us make them welcome.

L. Reid: I have three lovely guests in the gallery today. My mentee is here: Britney Allen. Many of you will have heard me speak in the past about Equal Voice, an organization that supports young women to seek public office or to be involved in campaigns. She has joined us, and I ask the House to please make her welcome.

And my dear friend Margaret McColm is with us. She's joined by Michael Lee, who is a family member visiting from Edinburgh, Scotland. It's that glorious gap year that might become a gap decade. We wish him well, and thank you very much for coming.

H. Bains: I think they might be able to make it to the vicinity or be in the House here — 40 students and ten of their parents, led by Louise Hazemi, from North Surrey Learning Centre. Those students are here to learn the working of this House. If they are around here, please give them a warm welcome.

C. Trevena: Mr. Speaker, I'd first like to make an introduction on your behalf. We have visiting a Clerk from another jurisdiction, on attachment to our House this week. Mr. Tim Mercer is the Clerk of the Legislative Assembly of the Northwest Territories. This is one of a continuing series of attachments whereby our Legislative Assembly hosts Clerks from other jurisdictions. On your behalf, Mr. Speaker, I'd like the House to make Mr. Mercer very welcome to British Columbia and to our House.

I also have another introduction to make. There is in Campbell River — I have talked of it a number of times in this House — a wonderful organization: the Multicultural and Immigrant Services Association. We have a number of guests in the House, in the gallery, today from the English-as-a-second-language 50-plus conversation group.

They've been on a tour of this place to learn about the workings of our Legislative Assembly and now will see democracy in action with question period. They have been warned that there is a reason why these aisles are two sword-lengths apart, but I hope that the House will make them most welcome and show them our best behaviour.

N. Simons: My partner, Scott, and I are thrilled to announce the arrival of a new niece, and I'd like to congratulate my brother-in-law Blair and his beautiful wife Kara on the arrival of Mackayla last week. Would the House make her welcome to this place.

Introduction and
First Reading of Bills

Bill 12 — gunshot and stab wound
disclosure act

Hon. M. de Jong presented a message from His Honour the Lieutenant-Governor: a bill intituled Gunshot and Stab Wound Disclosure Act.

Hon. M. de Jong: I move the bill be introduced and read a first time now.
[ Page 4804 ]

Motion approved.

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Hon. M. de Jong: Bill 12 mandates health facilities to report the treatment of any patients who are suffering from either a gunshot or most stab wounds. The legislation relates to one of the commitments that the government made last year in its plan to combat gang and gun violence. The proposed legislation will, we believe, enhance public safety by increasing the consistency of reporting these violent injuries and thereby enabling police more timely responses to potentially high-risk incidents involving firearms or knives.

The proposed legislation would establish that every health care facility, and that is defined in the legislation, that treats a person with a gunshot and most stab wounds would be required to verbally report the following information to the police of local jurisdiction: the person's name, if it's known; the fact that the person is being treated or has been treated for a gunshot or a stab wound; the name and location of the health care facility; and any other information required by the legislation.

It would, as I've indicated, encompass all gunshot wounds, and stab wounds that are believed to be intentional. Stab wounds that are self-inflicted or accidental would not be required to be reported. I'm happy to say that police and health representatives have expressed their general support for the introduction of this mandatory gunshot and stab wound reporting system.

Mr. Speaker, I move that the bill be placed on the orders of the day for consideration by the House at the next sitting after today.

Bill 12, Gunshot and Stab Wound Disclosure Act, 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.

BILL 13 — fORESTS AND RANGE
(FIRST NATIONS WOODLAND LICENCE)
STATUTES AMENDMENT ACT, 2010

Hon. P. Bell presented a message from His Honour the Administrator: a bill intituled Forests and Range (First Nations Woodland Licence) Statutes Amendment Act, 2010.

Hon. P. Bell: I move that Bill 13 be introduced and read a first time now.

Motion approved.

Hon. P. Bell: Today I introduce Bill 13, which proposes a new long-term, area-based First Nations woodland licence. In March of 2009 the Working Round Table on Forestry made five recommendations specific to encourage First Nations to become full partners in forestry. Today this new woodland licence directly responds to recommendation No. 25, which reads: "…create more long-term, area-based forest tenures that are of an economically viable size and create legislation for a First Nations forest tenure."

This tenure is unique and provides additional values that are important to First Nations. The woodland licence will provide exclusive rights to harvest timber on Crown land and the right to harvest, manage and charge fees, also, for botanical forest products and practise aboriginal stewardship and protect traditional use values.

Forestry is a long-term business, as we know. So introduction of a long-term, area-based tenure that can also include private or reserve land will improve the economic viability for First Nations' tenures.

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

Bill 13, Forests and Range (First Nations Woodland Licence) Statutes Amendment Act, 2010, 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.

Statements
(Standing Order 25B)

trade between b.c. and asia

R. Lee: Today I would like to speak about the relationship between our province and China. Last month I welcomed the Shanghai Light Music Troupe concert to celebrate the 40th anniversary of Canadian-Chinese diplomacy. It has become evident that we are quickly moving ahead to foster this relationship and create new opportunities for our two countries.

The implementation of our Asia-Pacific initiative has led to an opening of the Asia-Pacific business centre in Robson Square and three investment representative officers in Shanghai, Beijing and Guangzhou. Of course we are aware of the recent news that Air China will be increasing the amount of daily flights to YVR. Last month I was invited to travel to China to participate in the Boao International Tourism Forum in Hainan, where I stressed the importance of a timely implementation of the approved destination status, ADS, for Canada to the Chinese leaders.

I was also in Nanning, city of Guangxi, to enhance the education and business relationships at the Canadian Western Economic Partnership forum on the B.C. promotion day. I was more than impressed with the feedback I received whenever the topic of B.C.'s Asia-Pacific initiative was discussed.

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Asia accounts for a higher percentage of British Columbia's total exports today than it did ten years ago. Almost 37 percent of B.C.'s total exports went to Asia in 2009 compared with just 23 percent in 2000. In fact, British Columbia exports the highest percentage of its goods to Asia than any other province in Canada.

We need to continue to build on these types of relationships and ensure that they receive the attention they deserve. I would like to congratulate those who have made these partnerships possible and ask that the House recognize their efforts to help build a stronger province.

KOOTENAY YOUTH PARLIAMENT

N. Macdonald: On May 7 to 9 the community of Invermere will be hosting the Kootenay Youth Parliament, and I'm looking forward to being part of this most important leadership-building opportunity for the region's youth.

Youth from across the Kootenays will meet at David Thompson Secondary School, where they will learn more about parliamentary debate and how to become a leader in their own community. This year's Kootenay youth Premier will be Tonie Minhas, and the Leader of the Opposition will be Ali Perdue. The event is put on with the assistance of Werner Kopp, a dedicated teacher who has mentored many aspiring leaders during his career.

The Kootenay Youth Parliament is also being strongly supported by Invermere's mayor, Gerry Taft. Mayor Taft participated in the British Columbia Youth Parliament during his time in high school. In fact, Gerry was the student organizer of the 2001 Kootenay Youth Parliament in Creston. Mayor Taft credits the program with helping him develop the skills he needed to succeed in his own political career. At the age of 20, he was elected to Invermere town council, and at 26 he was elected mayor. Other young area politicians who were involved in youth parliament programs include Carmen Gustafson, who served on Golden's town council while in her 20s.

The interest in youth parliament amongst our young people proves that democracy is alive and well throughout British Columbia. It proves that high school students in classrooms across the province care about responsible government and understand their role in protecting our democratic institutions.

Before coming here I was a social studies teacher and always used to enjoy our MP, Jim Abbott, taking the time to visit our classrooms and talk to students. I think it's something that all MLAs do in their own communities. So I'm looking forward to participating and to encouraging youth to be interested in this parliamentary system.

TOURIST ATTRACTIONS IN
CARIBOO-CHILCOTIN AREA

D. Barnett: The Cariboo-Chilcotin coast includes approximately 9,350 miles of coastline, 8,000 lakes and 11,000 miles of rivers and streams. The climate features warm, dry summers averaging between 21 and 28 Celsius and beautiful, cool, fresh air and crisp, cool winters. As you travel along Highway 97 from the south or the north, Highway 24 from Highway 5, the beauty of the landscape will bring awe to all.

The history of the Cariboo-Chilcotin is an amazing story. Throughout the Cariboo-Chilcotin, the wagon road from the gold rush to Barkerville can be found in many areas. Local visitor information centres with well-trained local staff can provide you with information of the history or information on any of the other great attributes of the Cariboo-Chilcotin.

Services to the tourist are available throughout the vast region. Major communities throughout the region provide hospitals, dentists, shopping centres and all other necessary services — whether you are a fisherperson, a birdwatcher, a boater, canoeist, horseback rider, biker, hiker, snowmobiler, skier or just want to relax in one of the many first-class resorts throughout the Cariboo-Chilcotin. Spas, fine dining, entertainment and special events — from January to December your vacation will be everlasting.

Cariboo hospitality is the best in the country, your home away from home. Come bring your family, your friends, and see the greatest place with the greatest people, the greatest food and the greatest hospitality on earth — the Cariboo-Chilcotin.

LITERACY PROJECT IN KYUQUOT

C. Trevena: Imagine a world without the written word. In our culture we're surrounded by words. Billboards harangue us to buy products or to go places. Headlines are blaring. Magazines are at the checkout. The written word is an integral part of our lives, our work and often our leisure. Knowing how to read is elemental for our survival, which is why the Kyuquot literacy project is so important.

[1350]

Kyuquot is a remote community on the west coast of Vancouver Island, home to the Ka:'yu:'k't'h'-Che:k:tles7et'h' First Nation. There, trees tower, not billboards. Travel is by boat or by foot, and as Susan Plensky discovered when she first moved there, there are no magazines or papers in the store.

She saw the books in the K-to-12 school library. Many were out of date or deteriorating, and the stock was slim, with an average of 55 books per school year. Children need hundreds of books and the written word to become fully literate, and while Kyuquot is served by the
[ Page 4806 ]
splendid Books by Mail service, that didn't work out for many of the families.

This, in addition to the very high poverty levels there, pushed Susan into being a zealot for literacy and for fundraising. She started the Kyuquot literacy project, raising money for books for the community.

It's hard work. The logging companies, Interfor and others, have said they can't afford to donate. Some of the resorts allocate money depending on the number of guests they have staying, and any grant moneys available for literacy can't be spent on library collections.

But she's not giving up. The literacy team has put out a new brochure and is circulating it among businesses in Kyuquot, Nootka Sound and Campbell River. The target is $60,000 investment in new books for the school.

In the big picture, it's not much, but it will make a huge difference for the children and their families in Kyuquot village. Their newsletter reads: "Literacy will end the poverty that exists in Kyuquot village by creating new opportunities for the students as they grow." It's a great hope, and I urge all members to join their campaign.

CAMBRIDGE ELEMENTARY SCHOOL
RUNNING CLUB

S. Cadieux: We all know that a healthy lifestyle includes physical activity, and getting an early start on incorporating fitness into your lifestyle is important. Setting goals and making exercise fun improves the odds of success. So how about a 12,000-kilometre running goal for a start?

Cambridge Elementary in my riding is home to a running club that gets their students moving. Each year for the month of April, the school hosts this club to help get the school community active. The program was started by Cambridge principal Bob Winton with the help of dedicated teachers Kristy Sveinson and Ivana Smith, parent Kristan Ash and PAC president Laura Ramsbottom.

I asked: why a running club? They gave me three really great reasons: to encourage kids to be active and exercise, to lead to participation in sports like track and field in the future, and, lastly, to build community.

Well, it's certainly working. After school every day this month, the crowds gather to get moving. Over 400 of Cambridge's 600 students are participating in the program, and it has the highest volunteer turnout of any program the school puts on each year. Some of the parents and teachers run alongside, and some of the kids' younger siblings also get in on the fun.

Last year the Cambridge running club ran a total of 12,000 kilometres, and this year they're well on their way to surpassing that goal. On Friday when I attended to assist in delivering the ribbons for the individual running goals, more than one young athlete had already accumulated 80 kilometres.

So I'd like to say congratulations to Cambridge Elementary for their enthusiastic, energetic and engaging fitness quest. I wouldn't be surprised to see one or two of these young athletes run a marathon or two in the future.

MINERALS NORTH CONFERENCE
IN PRINCE GEORGE

D. Donaldson: The Minerals North annual conference took place last week in Prince George. This year's theme, "Opportunity Rocks," was reflected in the upbeat atmosphere at the forum and also in the incredible number of exhibitors. More than 100 booths and displays could be found inside and outside the Prince George convention centre.

Communities were well represented. From my area, Smithers and Stewart had booths as well as the regional district of Bulkley-Nechako. Educational institutions like Northwest Community College with its award-winning school of exploration and mining were prominent, and sector associations like the Smithers exploration group had a high profile in the trade show.

The presentations at the forum provided some key insights. In addition to the various mining proposal updates, there was an entertaining but thought-provoking presentation from Byng Giraud, vice-president of corporate affairs for Imperial Metals. One of his salient points was the need to properly resource First Nations when it comes to development proposals, as a way to create more certainty in the application process.

This view was echoed by another presenter, Tahltan Band Chief Rick McLean. He described a situation from a couple of years ago where the Tahltan faced more than a dozen major development proposals on their traditional territories and were expected to quickly respond in detail to the environmental and social implications of each.

We need another mine to be part of the economic mix of our economy in the northwest. In fact, no new metal mine has opened in our region since before 2001. But as Chief McLean pointed out, it is the pace of development that needs to be looked at.

[1355]

Even former Alberta Premier Ralph Klein said after he left office that the tar sands development, for instance, was too much too fast. That advice is well worth listening to from a popular right-wing politician who no longer has an axe to grind.

Congratulations to the Prince George organizers of Minerals North, and I look forward to attending in Stewart next year.
[ Page 4807 ]

Oral Questions

SURGICAL SERVICES IN
FRASER HEALTH AUTHORITY

A. Dix: In an internal document to staff last Thursday, the Fraser Health Authority admitted that it will be reducing its medically necessary scheduled surgery budget by 14 percent in 2010-2011. This comes on the heels of thousands of surgeries in the Fraser Health Authority that were cut last year.

Will the minister tell this House and the residents of the fastest-growing health authority in the province what surgeries will be cancelled, which hospitals will be affected and what operating rooms will be closed?

Hon. K. Falcon: First of all, Member, that's over two years, so that's last year's and this year's budget. But I think the member would be interested in what the actual numbers say in terms of total surgical volumes. They will be affected by about 1 percent to 2 percent. That is the actual difference.

The fact of the matter, as we've said on many occasions, is that even with a 15 percent budget increase in the Ministry of Health — over $2 billion more over the next three years — there are still pressures. The good news is that they are managing their pressures at Fraser Health in a way that has minimal impact on surgical volumes in spite of the fact that they are managing their budget, as we would expect them to do with taxpayer dollars.

Mr. Speaker: Member has a supplemental.

A. Dix: The minister will know that last year, the Fraser Health Authority cut 5 percent of its operating room hours. So 1 percent to 2 percent, 5 percent — these seem all small numbers to the minister. They're big numbers when you're waiting for surgery in Fraser Health.

These are all medically necessary surgeries that are going to be cut in a health authority that's gaining population every single year. We're talking about everything from neurosurgery to vascular surgery to orthopedic surgery.

Can the minister be specific? Which operating rooms will be closed? That seems like a reasonable question. What hospitals will be affected, and what types of surgeries will be cut?

Hon. K. Falcon: I'll be very specific in the sense that one thing the members opposite never get is that the only thing they measure in our health system is what goes in, not what we get out. I'll remind the member — another uncomfortable NDP fact moment — that the only organization that is universally respected across Canada, the Canadian Institute for Health Information, says that the one province that has the record number one in the country for delivering on elective surgical procedures is right here in British Columbia.

You know, Mr. Speaker, that is an outcome. You know, the member talks about how much is going into budgets, and if budgets get reduced at all, that must be the end of the world as we know it. The fact of the matter is I told the member that surgical volumes overall, staff advise me, have been affected by about 1 percent to 2 percent of total surgical volumes.

The fact of the matter is that even with asking the health authorities to manage within a 15 percent budget increase over the next three years, they still…. To their credit — and I want to say that on the record to the staff and the doctors and the nurses — British Columbia leads the entire country in wait times for surgical procedures.

Interjections.

Mr. Speaker: Members.

Member has a further supplemental.

A. Dix: Tenth in the country. Tenth in diagnostic procedures. Tenth in the country on MRIs. Wait times for MRIs, the longest in the country. That's the record of the government. What did the minister do last year? He cut thousands — indeed, tens of thousands — of MRIs in the health care system. That's what he did last year.

[1400]

Long wait times in the Fraser Health Authority. Every single hospital in the Fraser Health Authority felt the cuts last year, and the patients in Fraser Health have the right to know what the minister plans to do this year.

The minister is already laying off staff in Fraser Health that protect sterilization, that protect the public, that protect the public safety. Can he tell us — if it's 1 percent to 2 percent, if that's what he says — why the minister is laying off sterilization staff right now and why people in Fraser Health should expect longer wait times when their own minister from their own region is not protecting their interests?

Hon. K. Falcon: You know, just for once it would be nice to hear the member opposite actually get some facts right. When the member talks about cuts of tens of thousands of MRIs, that is just completely false. The fact of the matter is that the number of MRI machines has gone from nine when we first got elected in 2001 to 23 today, and the number of MRIs performed is up 156 percent.

I note that the member is careful not to talk about the Canadian Institute for Health Information outcomes. I find that fascinating — the organization respected right across the country. Joined by the Wait Time Alliance made up of doctors from one end of the country to the
[ Page 4808 ]
other, what did they say about British Columbia? British Columbia is No. 1 in hip surgery wait times, knee surgery wait times, cardiac, cataract, cancer — all here in British Columbia, No. 1 in the country. We never hear that from the critic, but that is a fact.

STAFFING OF STERILIZATION UNITS
IN FRASER HEALTH AUTHORITY

S. Hammell: Hon. Speaker, it is very troubling that sterilization staff are being laid off in Fraser Valley hospitals, which are the busiest in this province. Front-line staff are warning that already they are struggling to ensure patient safety. Furthermore, in these past days and weeks British Columbians have been troubled by cases of contaminated medical equipment.

These incidents have highlighted the need to bolster, not reduce, the capacity of sterilization departments in our hospitals. Will the minister reconsider these cuts to sterilization departments?

Hon. K. Falcon: First of all, I think it's important for the member to get the facts. That always helps in a discussion like this. Out of 230 individuals in Fraser Health, we're talking about seven positions — seven individuals that would be impacted. One is a part-time clerk at Royal Columbian Hospital, and another is a patient transport aide. A couple are empty positions that aren't being filled. I can share that information with the member opposite.

But I'll tell you this, Mr. Speaker. What you will find if you listen to the experts in this like Dr. Michael Gardam, who's an infectious disease specialist from Ontario, or Dr. Doug Cochrane, who's the chair of our patient quality office, is that the issue of clean surgical equipment is an issue where you will never, ever eliminate that risk altogether. What you must do is focus continuously on continuous improvement.

That is exactly what we do in British Columbia. Unlike the members opposite that had no auditing procedures whatsoever, we actually do audit performance, and we make sure that we continue to invest, as we're doing in Fraser Health.

Mr. Speaker: The member has a supplemental.

S. Hammell: Why, if it doesn't matter, are other health authorities now moving to improve their sterilization departments to prevent more cases of contaminated equipment?

Vancouver Island Health Authority is increasing its weekend staff after notifying 500 patients about potential exposure to a contaminated medical endoscope. The Interior Health Authority is finally making Royal Inland Hospital's sterilization department a capital priority. Plans to upgrade the unit have been delayed since 2008, and this February the hospital was forced to cancel and postpone hundreds of surgeries because of unclean surgical tools.

[1405]

Will the minister apply the lessons from these recent incidents and reject cuts to sterilization departments in the Fraser Valley?

Hon. K. Falcon: I think the first thing the member should be comforted by is that Fraser Health actually operates according to ISO 9000, which is the highest quality management standard in the world, in their sterilization department. That's what they do today.

I think the member should also be careful not to try and mix and match different situations that took place at different hospitals that have no relationship whatsoever to Fraser Health. The member should know that in Royal Inland Hospital, there's an RCMP investigation underway with respect to what is alleged to be some criminal tampering that was taking place. That is, of course, of great concern.

In the case of Vancouver Island Health Authority, the member will know….

Interjections.

Mr. Speaker: Members.

Minister, just take your seat for a second.

Continue, Minister.

Hon. K. Falcon: I'm trying to point out that the member should get the facts on these situations before she tries to mix them all up and confuse the public. That is not appropriate.

The fact of the matter is Fraser Health has the highest possible standards in its sterilization unit. The positions that are being impacted — seven individuals, I am advised out, of 230. One is a part-time reception clerk, as I mentioned, at Royal Columbian. The other is a transport aide. The fact of the matter is they continue to have exceptional levels of sterilization procedures in Fraser Health, and they will continue to in the future.

ACUTE CARE BEDS AT
ST. JOSEPH'S HOSPITAL

S. Fraser: It was a packed meeting in Courtenay on Saturday. The absence of the Minister of Health and the member for Comox Valley was duly noted by over 400 residents that attended. They are fighting against this government-backed proposal to shut down acute care beds at St. Joseph's Hospital.

Residents and the hospital staff are unified in their opposition to this plan, in part because it overlooks viable alternatives like utilizing residential care beds that are sitting idle in the community as we speak. Doctors have
[ Page 4809 ]
also issued a resolution declaring they are unanimously against reducing this hospital's acute care facilities.

Will the minister finally agree to meet with the Comox Valley residents and physicians and hospital staff to consult with them about how to keep these essential acute care beds open?

Hon. K. Falcon: As I mentioned when we canvassed this last week, the fact of the matter is today there are 109 acute care beds at St. Joseph's Hospital. That is the same number as there was when we were elected in 2001.

The only unfortunate cut in acute care beds at St. Joseph's Hospital took place in the 1990s, when the NDP cut them from 125 to 109. So let's just make sure we get that point straight.

The second thing I would say is that what they are doing is actually creating a transition unit within the hospital made up primarily, though not exclusively, of seniors who are waiting to transition into residential care hospitals. They do not require the same level of care as acute care patients, so they are getting the appropriate level of care. It is being done in other hospitals throughout the province. It's the right way to deal with this issue, and no, I won't be interfering with that decision.

Mr. Speaker: The member has a supplemental.

S. Fraser: That explains why the minister didn't show up at the meeting. He wouldn't have got away with those vacuous pieces….

Interjections.

S. Fraser: The Comox Valley and the surrounding areas cannot absorb another blow to this region's health care. It's not good to be bragging about doing nothing.

Dr. Stefan Schovanek summarized that this cut to acute care capacity undermines the hospital's ability to provide care. He said: "It's the bale that breaks the camel's back." Dr. Schovanek said that he's never seen physicians turn out against an issue with such force, and that is reflected throughout all of the support staff and the community at large.

[1410]

To the minister again: will he halt these dangerous cuts and agree to meet with the front-line workers, the health care professionals, at St. Joseph's before he makes a big mistake that could seriously undermine the health care delivery in the Comox Valley and across Vancouver Island?

Hon. K. Falcon: In an era when the budget is going up by over $2 billion over the next three years — that's just operating dollars and doesn't include $3 billion in capital — and in an era where that is still not enough in the health care system, not once have we ever heard the opposition put forward a new idea, a different way of doing things — perhaps trying something different to make existing dollars go further.

The only thing we ever hear from the NDP is: "Do not make any changes, and throw more money into it." They never talk about where the money is going to come from. They never talk about who they're going to tax more. They never talk about adding more debt to our children.

The difference is that we are saying to the health authority: "Manage your budgets within the 15 percent increase." They are doing that. This is the right decision they are taking. It is not surprising that the NDP would line up and say: "Any change is a bad change. Please just throw more money at the system." That's what they always say.

COMMENTS BY FORMER FINANCE MINISTER
ON HARMONIZED SALES TAX

J. Horgan: My question is to the Minister of Finance. We've heard over the past couple of days his assertions that there's misinformation with respect to the HST.

Now, everyone on this side of the House recognizes that the misinformation started prior to the election campaign. It's not just members on this side of the House. I think members will be familiar with one Carole Taylor, who said publicly on television last week the following. I'll quote if you don't mind.

I'm sure the members might have picked this up from the public affairs bureau, but in the interests of certainty, it went like this: "But I think the bigger issue is that just before the election he promised that he would not, they would not, do the harmonization of the sales taxes and then right after the election decided to do it."

My question is to the Minister of Finance. Will he agree with his former colleague Carole Taylor, the former Finance Minister, that this government was elected based on misinformation?

Hon. C. Hansen: It's interesting when you actually start to go back and look at what was said before the election. I've got a great reference here. We've been trying to figure out the position of the NDP on harmonized sales tax.

We know that the Finance critic says that if they ever get elected — God help us — it would be here to stay. But we know the Energy critic, the member for Juan de Fuca, has said that they would get rid of it but jack up a bunch of other taxes, which is interesting.

I have a quote from the member for Juan de Fuca in the Hansard from the Finance and Government Services Committee of this Legislature from — and you might want to write down the date — September 25, 2006. The member says: "I want to go to the GST-PST harmonization." He goes on to say this, and it's in Hansard: "I know my spouse is a small business person, and she has to deal
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with both sets of bureaucrats. That's the motivation for her for harmonization."

Not only do we have conflicting policy statements by various members of the opposition, but now we've got conflicting statements by the member for Juan de Fuca himself.

[1415]

Interjections.

Mr. Speaker: Just take your seat, Member. We're not continuing for a second.

The member has a supplemental.

J. Horgan: I will say that my wife….

Interjections.

J. Horgan: Enjoy it now.

I will say that my wife will be surprised that she had that much influence over the Minister of Finance. I'll also say that her business was called Young at Art, and she provided arts and crafts supplies to children. Under your tax she'll have to pay tax on crayons. But enough about me and my all-powerful wife.

Interjections.

Mr. Speaker: Members.

J. Horgan: Let's move to another powerful person, the former Minister of Finance, who said that not only did the government mislead the public during the election. She said the following: "This particular tax takes the tax off businesses. It takes $1.8 billion off of businesses and puts it onto consumers." She went a little bit further and said: "So that shift is a shift that is ideological as well as factual."

My question again to the Minister of Finance: does he agree with his predecessor, the Minister of Finance, that this tax was misinformation and deception before the election and a tax shift from business to consumers after the election?

Hon. C. Hansen: Well, I think the member might want to explain to the House why his position has changed over the last number of years. Maybe even more importantly, what is his position on the harmonized sales tax today in terms of what they would do?

We know that small business owners around the….

Interjections.

Mr. Speaker: Minister, just take your seat.

Continue, Minister.

Hon. C. Hansen: Small business owners have been advocating for the abolition of the provincial sales tax and the adoption of the harmonized sales tax for many years now. In fact, the B.C. Chamber of Commerce has been proposing this, going back to the mid-1990s.

In fact, it's also one of the reasons why you wind up with the certified general accountants supporting harmonized sales tax. The Institute of Chartered Accountants of British Columbia are supporting the harmonized sales tax. The reason for that is because it's good for small business, including the member's wife's company, and it's also good for job creation in British Columbia. That's why we are for it.

D. Donaldson: Well, the minister likes to talk about the past, but here's a lesson in current politics. The entire province is clear on the HST. People know they'll pay more if it's implemented, and they don't want it. That government's former Finance Minister recently said: "The HST takes tax off big business" — and this is her quote — "and puts it on consumers. So that shift is a shift that is ideological as well as factual."

Does the current minister agree with the former Finance Minister, Carole Taylor, that hard-working B.C. families unfairly shoulder the burden of this government's HST?

Hon. C. Hansen: I note that the member for Stikine is one of the canvassers for Bill Vander Zalm. Perhaps the member can share with us whether or not he actually supports his leader Bill Vander Zalm…

Interjections.

Mr. Speaker: Members.

[1420]

Hon. C. Hansen: …when in a letter to the editor in the Vancouver Sun this morning, Bill Vander Zalm says that British Columbia could easily make the provincial sales tax work the same way as a value-added tax. You know how he would do that? He says: "It could apply to all goods and services. Reduce it to 3 or 4 percent, and provide input tax credits."

Perhaps the deputy Finance critic for the opposition could tell us whether he agrees with his leader, Bill Vander Zalm, that we should actually be adding a 3 percent or 4 percent consumption tax to all groceries, to all home heating costs, to gasoline, to prescription drugs. The question is: is he in fact on side with his leader, Bill Vander Zalm?

Interjections.

Mr. Speaker: Just take your seat, Member.

Members.

The member has a supplemental.
[ Page 4811 ]

D. Donaldson: Well, with that kind of answer, we can understand why the former Finance Minister got out while the getting was good.

Interjections.

Mr. Speaker: Minister.

Continue, Member.

D. Donaldson: The members on that side of the House are repeatedly trying to convince British Columbians that the HST will be good for them. Those attempts have failed. This government's own former Finance Minister said: "Right now the B.C. Liberals are sure on the losing end of this." Perhaps if the government withdrew the bill, then people might be less angry.

To the Finance Minister: does the Finance Minister agree with his predecessor, and will he withdraw the ill-conceived HST legislation?

Hon. C. Hansen: I agree with the leading economists in Canada who actually say that the elimination of the provincial sales tax and adoption of the HST is the single biggest thing we can do as a government to create jobs and stimulate the economy.

I agree with some of the leading economists like Jon Kesselman, who writes that the way we have structured the transition from the PST to the HST is going to make sure that low-income British Columbians, in fact, come out better off as a result of the income tax credit.

I agree with those leaders in the economy who say that this is actually going to be a big benefit for British Columbia. It's going to mean tens and tens of thousands of new jobs and billions of dollars of new investment that will come to British Columbia and drive this economy so that families can enjoy good-paying jobs in this province as a direct result of the harmonized sales tax.

FUNDING FOR SCHOOL BAND PROGRAMS

R. Austin: The Vancouver school board orchestral strings program at Annie B. Jamieson Elementary School, the biggest school string orchestra in Canada, will have to close because of this government's failure to provide enough money. Parents and students are on the streets today to try and save their program.

I hope the Minister of Education pays attention and starts listening to them. The math is simple. Increased costs plus underfunding from this government equals the cancellation of programs for students in British Columbia.

Can the Minister of Education tell this House why she's forcing the closure of band and string programs in Vancouver and taking apart the quality education system that this province has enjoyed?

Hon. M. MacDiarmid: Certainly, on this side of the House we know how important programs like music and the arts are. That's why in 2005 this government made the largest single investment ever for these kinds of programs — $150 million.

[1425]

The members opposite are well aware that we have increased education funding every single year for the last ten years. This fall will be the tenth year in a row. There will be an additional $1.3 billion going to classrooms around this province.

MEETING BETWEEN SCHOOL TRUSTEES
AND EDUCATION MINISTER

D. Thorne: What it boils down to is this. The Education Minister is not doing her job, which is supposed to be supporting students in this province. All this minister wants school boards to do is cut, cut, cut. But there is nothing left to cut except programs for students.

The school trustees tried to have a conversation…

Interjections.

Mr. Speaker: Members.

D. Thorne: …with this minister on Friday but found an unwilling partner who packed up and got out of the room to avoid the tough questions.

My question to the minister is this. How is she going to fix the crisis in B.C. schools when she won't talk to parents, she won't talk to students and now she won't talk to school boards?

Hon. M. MacDiarmid: The member opposite is really quite mistaken in her assertion. I have been travelling the province. I've spoken with school boards, I've spoken with parents, and I was available to speak with the trustees last week.

I think it's time for what my colleague the Minister of Health refers to as one of the NDP uncomfortable facts. Let's look at the NDP platform from this most recent election. Where they were going to plan to spend $50 million last year, we increased our investment in education by $84 million. This year their platform had a planned investment of $75 million, where we actually invested $112 million. We have invested 60 percent more than their platform stated they would invest.

[End of question period.]

Hon. K. Falcon: I seek leave to make an introduction.

Mr. Speaker: Proceed.
[ Page 4812 ]

Introductions by Members

Hon. K. Falcon: I rise to introduce two visitors who are in the House today, joining us all the way from the community of Summerland. I understand, Mr. Speaker, that you may be familiar with one of them. The first is Carla Wright, who is the mother of my very capable executive assistant Jennifer. We are also joined by Marie-Isabel Guibe. She is visiting Canada all the way from Reiffelbach, Germany. I would ask the House to please make them welcome.

M. Sather: I seek leave to present a petition.

Mr. Speaker: Proceed.

Petitions

M. Sather: I have before me another 500 signatures from people in Maple Ridge and Pitt Meadows calling on the government to scrap the HST.

Orders of the Day

Hon. M. de Jong: In Committee A, I call Committee of Supply — for the information of members, the estimates of the Ministry of Forests and Range — and, in this chamber, continued second reading debate on Bill 9.

Second Reading of Bills

Bill 9 — Consumption Tax Rebate
and Transition Act

(continued)

On the amendment (continued).

R. Chouhan: I rise today to speak about the amendment motion to refer Bill 9 to the Select Standing Committee on Finance and Government Services and to empower the committee to invite witnesses to appear before it to assist in its deliberations.

[1430]

[L. Reid in the chair.]

As we all know, before the last provincial election British Columbians were told that there would be no HST in British Columbia, and we now know that British Columbians were betrayed by the B.C. Liberals. Right after the election was over, without any consultation with anyone, the B.C. Liberals said: "Oh well, the election is over. Let's have the HST." There was absolutely no consultation. No wonder 82 percent of British Columbians are against the HST. That's why it is important that we should all support the referral motion.

I'm sure that all government MLAs have read the latest Angus Reid poll. Some of them may still be reading and wondering what went wrong and why the B.C. Liberals are so low in the polls. They must be wondering why British Columbians do not trust the B.C. Liberals, why British Columbians think the B.C. Liberals are so arrogant. It's all in the polls.

Well, the answer is simple. The B.C. Liberals deliberately kept the citizens in the dark before the election. The B.C. Liberals had a plan to win the election by deceit, and after the election they just came right out and imposed the HST without any consultation with anybody in British Columbia.

This is not the first time the B.C. Liberals have broken their promises. I remember one very important promise they made before 2001, even. That promise was made to the Hospital Employees Union, my union. They promised that they would not introduce Bill 21. They promised that they would not break the collective agreement. It was on record.

But when they won the election, they did that. No consultation; no nothing. That's why it is important that we refer this motion to the select standing committee, so people will have the opportunity to provide their feedback and provide their input.

The B.C. Liberals have also failed to perform due diligence prior to their decision to adopt the HST. For example, the Finance Committee recommended in the fall of 2008 that a cost-benefit analysis needed to be conducted to determine whether a harmonized sales tax may be worth considering. No such analysis was performed.

It was only in March 2010, eight months after the HST was announced, that a biased and government-commissioned study was released. No public consultation. Many stakeholders have spoken out about the HST, but no comprehensive cost-benefit analysis has been done.

All of this can be done now if we refer, successfully, this motion back to the select standing committee so that they can invite all British Columbians to have their input. This is part of a pattern by the B.C. Liberals to make cuts without any analysis or a follow-up study as to their effect. They should therefore take a second look at this decision. They should therefore support our motion to refer Bill 9 to the Select Standing Committee on Finance and Government Services and empower the committee in its deliberations so that they can invite witnesses to appear before it.

Without a proper consultation, the B.C. Liberals do not have the mandate to impose this bad tax upon British Columbians. During the election they said they were not contemplating adopting the HST.

Before the election they had turned it down numerous times on the grounds that it would hurt consumers because this gives tax credits for business inputs, generally helping big businesses. Government says that accord-
[ Page 4813 ]
ing to its own calculation, it would be by the amount of $1.9 billion. Especially the capital-intensive-goods producers and exporters — they are the ones who are going to benefit the most. It will hurt the service sector, who will have to charge HST where they were previously PST-exempt.

[1435]

There are several estimates of the costs of the HST to British Columbians and to consumers. The government claims that the HST will save businesses $1.9 billion but be revenue-neutral to government. Based on this, it must be the case that consumers in B.C. will collectively pay $1.9 billion more in sales tax. Based on a population of 4.4 million people, that amounts to roughly $432 extra per person on average.

The TD Bank did an analysis of the effect of the HST on consumers in British Columbia and Ontario. Their report concluded that in B.C., 21.4 percent of the goods and services that British Columbians buy will be newly subject to the HST — that is, will have a new 7 percent tax — and that, on average, prices will rise by 1.5 percent.

All these people are now telling the facts of what's going to happen when the HST is implemented. That's why it's important we have a second look at this Bill 9 so that people can at least have the opportunity to participate and tell the government what they feel about it.

The B.C. Restaurant and Foodservices Association, the Council of Tourism Associations of British Columbia, the B.C. Care Providers Association, the Federation of Community Social Services of B.C., the Rental Owners and Managers Society of B.C., some municipal governments and the Union of B.C. Indian Chiefs are all against the HST for good reason, because they know that this is a $1.9 billion tax shift from business to consumers.

Now, for a moment let's look at the B.C. Liberals' phony claim of how good a fiscal manager they are. The federal government is kicking in $1.6 billion in transitional funding. B.C. could take this money all upfront. The Finance Minister has decided to take the money over three years, which is estimated to cost B.C. about $74 million in interest payments that we otherwise wouldn't have needed to pay. This is what it's about — their being good fiscal management. They're losing money, even, by taking this action.

The B.C. Liberals are becoming more and more desperate. They want to sell this bad tax to British Columbians by hook or by crook. At first, the B.C. government was saying that the HST would be revenue-neutral to the government, but newly announced rebates will mean that the HST will reduce revenues by at least $330 million per year — approximately $100 million for increasing the threshold for the partial rebate for new housing purchases and approximately $230 million for partial rebates for school boards, health authorities and universities.

Once input tax credits for large businesses are phased in, approximately within five years, it will cost the government approximately $155 million more. But British Columbians know that the HST is a tax increase for consumers, a tax cut for business and will increase the deficit and further threaten essential services like health care and education.

When the so-called revenue-neutral gimmick did not work, the government then moved on and tried another gimmick — that the money raised through the HST would be earmarked for health care. Again, British Columbians didn't buy this because they know better, and they can see how much more they would be paying for items and services which were exempt from the PST for reasons of public policy.

[1440]

People will now pay 7 percent more for restaurant meals and catered foods; many groceries such as snack foods and other prepared foods like salads, sandwiches; heated food or beverages like a muffin or a coffee; school supplies; services such as taxi fares; recreational services like live theatre, movie tickets, amusement parks, campground fees, museum admissions, whale-watching tours; accounting services, which includes tax preparations, mutual fund management fees; veterinary care and other professional services like architects, real estate agents and appraisers.

That's not the whole list. It continues: classes for yoga, dance, cooking, martial arts; membership fees for clubs and gyms; player fees for team sports; facility and ice rink rentals; massage therapy, acupuncture and alternative medicine. The list goes on and on. I continue because we can't…. You know, the government is not giving this information on its website. The information we have found out is important that the public knows about it.

If we refer this motion to the select standing committee, I'm sure more detail will come out and the public will be more knowledgable. Then they can decide, based on true information, if they support or if they would be against the HST.

Haircuts and other personal care services like beauty salons and spas will be hit with the HST. So will vitamins, dietary supplements and other non-prescription medicinal products, magazines, periodicals, newspapers, newsletters, student yearbooks, bicycles, bike repairs and parts, wedding planners and caterers. And if people have not heard so far, even funerals will not be spared.

Repairs to home appliances, energy-efficient home appliances, laundry and dry cleaning, carpet and upholstery cleaning, car washes, basic residential telephone service, basic cable TV service, residential smoke and fire alarms, work-related safety equipment, energy-saving building materials, devices for vehicles, automobile towing and emergency roadside service.
[ Page 4814 ]

Again, this is a partial list we are talking about. There are many more services that were exempt from the PST and now will be hit with the HST. That's why it is important that we refer Bill 9 to the Select Standing Committee on Finance and Government Services.

During the 2009 election the B.C. Restaurant and Foodservices Association sent a questionnaire to all parties. One of the questions was whether they would implement the HST. The B.C. Liberals responded with detailed reasoning on why they would not harmonize the PST with the GST. Here's what they said: "It would extend the PST tax base to a broader range of goods and services that are presently exempt from provincial sales tax. This is a major concern." That's what the B.C. Liberals said.

I'm again continuing with the quote. It says: "The B.C. Liberals are also mindful that a harmonized GST would reduce the provincial government's ability to unilaterally adjust sales tax rates. In short, a harmonized GST is not something that is contemplated in the B.C. Liberal platform." That is very clear.

That's what the B.C. Liberal Party, the government before the election, told British Columbians — that they will not do it. After the election they changed their minds, and they imposed the HST.

For that reason alone, it's important that we provide a second opportunity for all British Columbians to participate and let the government know how they feel about it. The only opportunity they can get is if we are able to refer this bill to the select standing committee.

After the HST was announced on July 23, 2009, the BCRFA was understandably outraged. President Ian Tostenson wrote an open letter to his members saying that the HST was a complete surprise to him, because restaurant meals will now be charged an additional 7 percent tax.

[1445]

The BCFRA and the Canadian Restaurant and Foodservices Association president, Garth Whyte, and the vice-president for western Canada, Mark von Schellwitz, began a campaign, No Meal Tax, to oppose the HST and get their members involved. They encouraged people to write to the government and to put campaign materials in their restaurants so as to build opposition among the public. As of January 6, 2010, they claim to have over 100,000 signatures on the petition in different restaurants where they had it.

When you add it up, an additional 7 percent tax on meals will cost the industry $750 million each year in lost sales, according to CRFA's economic model that they presented. That is an annual loss of 7.5 percent or nearly $50,000 for an average restaurant in the province, which is more than the average annual pre-tax profit of $29,000 per establishment. Among the members of the restaurant association, of the B.C. restaurant owners, 91 percent believe it will have a negative impact on the food service industry, and 85 percent said a significantly negative impact.

Now, let's see who else is against this horrible sales tax other than the restaurant industry. The homebuilders and the real estate industry are also against the HST. This will effectively mean an additional 2 percent tax on new homes — not used — up to $525,000 after the rebate and an additional 7 percent tax on the value of a new home above $525,000. HST will also be charged on the real estate agent's commission as well as services like appraisal, maintenance, etc.

Today we have had a newsletter issued by the B.C. Real Estate Association, if I can find it. Anyway, I'll come back to it in a minute. They said that the average price in the Lower Mainland last year was over $900,000. Based on the new tax imposed, it will cost the new home owners, when they buy a house, in the range of up to $56,000 additional, a cost that could be added for homeowners who want to buy a house.

In addition to the B.C. Real Estate Association, the Council of Tourism Associations of B.C. is also against the HST. The council did a detailed impact analysis and found that the HST will increase the average price of tourism-related products and services by 4.6 percent. It will lower tourism industry revenue by $363 million to $545 million per year. It will cause jobs to be lost. The estimate done was that 3,446 to 5,176 direct jobs or 6,997 to 10,505 direct and indirect jobs would be lost in the tourism industry as the result of imposing the HST on British Columbians.

It will also reduce government tax revenues by $104 million to $157 million for all three levels of government. The provincial government goal of increasing tourism revenue to $18 billion by 2015 will be jeopardized by introducing this tax without any consultation with British Columbians.

[1450]

I urge all members of the government to pay very careful attention to the motion that we have made to refer Bill 9 to the select standing committee, because I'm sure your constituents are also calling the constituency offices, the government MLAs. All of them are hearing from their constituents how angry these British Columbians are.

So this is the time. Either the government should just completely back off and withdraw Bill 9 — that will make lots of people happy and make you the heroes — or at least just agree to refer this Bill 9 to the select standing committee. Then we can all argue if it's good or bad. At least we would have the opportunity to discuss and debate openly and clearly with each other, not like what we have now.

The Federation of Community Social Services Society of B.C. is also against this tax shift. The harmonized sales tax could increase costs for social service agencies according to a December 2009 analysis prepared by
[ Page 4815 ]
the federation that represents their interests. The federation's executive director, Jennifer Charlesworth, said her group is lobbying the province to increase the rebate level for those agencies from 57 percent to at least 75 percent.

You know, it shows how concerned people are. They just want to have something to hang on to, because this decision is going to really hurt their association, their organizations. It's not only the organizations who are speaking against the HST. There are so many individuals out in British Columbia who are also raising their concerns. I'll quote some.

For example, there was a letter in one of the Burnaby newspapers written by somebody by the name of Murray Martin. It says: "It is true that they are against welfare for the poor citizens of B.C. But corporate welfare is a different matter. The HST is a multi-billion dollar tax break to corporations with the burden shifted to the citizens of B.C. Essentially, the MLA for Burnaby North and his Liberal Party are promoting the welfare of the ones who need it least while ignoring the long-term welfare of B.C. citizens."

Then we have…. Somebody wrote this letter from Salmon Arm. I think these are comments by Ed Murdoch. "It is my belief, well enforced by hundreds of thousands of constituents across this province, that the HST is a very bad move by the Liberal Party of B.C. It certainly is not helpful for senior citizens, a proud group of which I'm a member, and I'm unable to endorse its benefits for small businesses, a group to which I also belong, a group which is struggling for survival in our provincial economy."

Another person. It's from Saanich North by Tracy Lawrence. Lawrence and her husband both work on the Saanich Peninsula and have two young children. They are worried about how the HST will affect their family's bottom line, and in one of the letters, she said: "We don't go to restaurants a lot, but we do like to go for coffee. That will cost more…. It will hit every facet of our lives, from groceries to activities for the kids."

These people are crying for input and consultation. These are the people who are saying: "Please give us an opportunity so we can talk to the government." That's why it's important that we refer this Bill 9 to the select standing committee — for that opportunity that British Columbians can have. They can at least talk about….

[1455]

The government members, some of them, are saying that they have talked to some of their supporters and that they are saying it's good for British Columbia. So let's have that opportunity. Let's have that open debate, where people can come and talk about it. If they support it…. They will let the public know if they support it or don't support it.

Many people that we have talked to, that we have seen writing letters to various community newspapers and sending letters and making phone calls to constituency offices, to all MLAs, are against the HST, the way it was brought down.

Before the election, as we all know, these people were saying — and they remember — that the HST will not be brought in and introduced in British Columbia, but right after the election people now know that they were betrayed. That's why it's so important for us to support this motion to refer Bill 9 to the select standing committee.

Another person wrote this. It's from White Rock, actually — the mayor, Catherine Ferguson. It says: "The combination of the HST and the TransLink tax, which is going from 7 to 21 percent, would mean an estimated shortfall in city revenues of $250,000…. The majority of the money raised through the increase will go to the hard costs of parking…but the impact on the end users of the parking spaces and parking lots remains to be seen." And the HST is not the answer.

I have about ten pages of these comments from people who are calling and asking the government to stop the HST being imposed on them arbitrarily. Last week I received this letter from one of my constituents. After I talked to her, she asked me to write this letter to the Minister of Finance, which I did.

What she was saying…. Her name is — I have permission to quote — Trudy Laneclyn. She e-mailed my office regarding the June 30 termination of the PST relief grant program for owners of homes with completed building envelope repairs.

According to the program's criteria, application for a rebate can only be submitted on completion of the project. In her e-mail she explains that her building envelope project will only be 65 percent complete by June 30. Therefore, they will be ineligible for the PST relief grant, and in addition, they will be saddled with additional costs due to the implementation of the HST.

All these people are concerned about it. I hope the Minister of Finance will look into this issue seriously and provide some relief to these people.

Thousands of people in British Columbia who rent will be hit with higher costs as well. The Rental Owners and Managers Society of B.C. has said that the 12 percent HST planned to come into effect July 1, 2010, will increase costs for most B.C. landlords by up to 3 percent above normal inflationary cost increases, even with the rebates on electricity and gas.

The Canadian Federation of Apartment Associations supports this call to action and will be doing its part to attempt to prevent the HST implementation. They're also mobilizing their members.

S. Cadieux: I am pleased to take my place here today in the debate to speak against this motion. I've already had the opportunity to speak on the benefits of the HST,
[ Page 4816 ]
and I welcome the opportunity to highlight some of those again.

[1500]

There's been a lot said in this House about a lack of mandate for the HST, and in fact, the mandate was given in electing a government that was committed to economic prosperity and jobs for British Columbians.

I hear clearly from the last speaker that the NDP is stuck in the past. While the world keeps turning and changing, they would like us to stay behind and do things as we've always done them — for the sake of a little confusion.

You know, to say that people have not had any opportunity to tell government or MLAs how they feel about this change — it's confusing. I guess that would be the softest language. Citizens have every opportunity to speak to their MLAs. That's why we have constituency offices. Certainly, I know that I've been speaking with people about this issue over the past year.

In fact, today we are debating the repeal of the PST and, in simpler terms, the removal of the provincial sales tax. It is confusing to me as to why we are sitting here debating a motion to send this whole thing back to the Finance Committee. Questions were posed last week in the Vancouver Sun by Jon Kesselman. Why on earth would we want to keep the PST? It's antiquated; it's unfair; it's confusing; it's complicated to administer and has embedded, hidden, charged-on-itself aspects of it. Why are the NDP in favour of keeping it?

Jon Kesselman said that the PST imposes a heavier burden on the poor and near-poor than the HST, that B.C.'s PST is seriously flawed and economically damaging and that whatever its potential shortcomings, the HST will be superior in almost every respect.

Still, today we're debating a motion to delay the elimination of a "decrepit and crumbling structure," as Kesselman described the PST, that will hold up the economic well-being of this province by impeding British Columbia's economic competitiveness in Canada, preventing future potential investments in industry and in the creation of thousands of new jobs.

No, I cannot agree to this motion. I have heard from my constituents that what we need to do is what we need to do to keep B.C. strong. That equates to moving forward, as I've said — not to sitting in a holding pattern, not the status quo for the sake of being comfortable or popular.

I don't believe that any taxation is ever popular. When a government raises taxes, they are bad. When a government lowers taxes, they're not low enough. I pay taxes; I don't like them. I don't look forward to them, but they are necessary so that we can have hospitals and PharmaCare, schools and universities, roads and bridges, sports and arts; and have support for those less fortunate or in need, for research and innovation, for a strong public service; and have a province and economy that is the envy almost the world over.

We have almost 4.5 million people in this province that need or want something from their government in terms of service. It adds up to a wish list well in excess of $40 billion, and you and I and the rest of British Columbia have to come up with that $40 billion year after year after year.

I ran for office because I want to help ensure that my money and yours is used in the most efficient, equitable way possible. The HST helps us to be more efficient. It helps us to be more transparent. Best of all, it will encourage the economy to grow, which will help us to meet that ever-growing wish list of British Columbians in years to come. It would not be efficient or prudent to delay the repeal of the PST, and that's why I'm against this motion to send Bill 9 to the Finance Committee.

A few days ago my colleague from Kamloops–North Thompson eloquently described the challenges of the PST system. He noted that the cascading, job-killing PST is recognized by study after study as being a detriment or a barrier to investment. He noted that this cascading tax is built into every stage of the production process and should be replaced by the harmonization of sales taxes, which will increase our productivity in Canada.

He backed up those statements, recalling that one of Canada's foremost fiscal policy experts, former Bank of Canada governor David Dodge, has explained that without productivity improvements, we will condemn ourselves to a standard of living which is in decline relative to the rest of the world.

[1505]

Why do I bring this up, hon. Speaker? Because it's why I'm very opposed to this motion that asks us to refer the bill to the Finance Committee. It will only delay further the repeal of the cascading PST, hindering potential investments in B.C. and the creation of thousands of new jobs even longer.

We were elected by our constituents to do whatever it takes to keep us from falling behind, to keep standards of living improving, not to bury our heads in the sand and shirk our responsibilities by committing ourselves to more investigation and another committee while we watch our standards of living decline. We know what we need to do to protect ourselves from this. The economists are united in an understanding of this, and we were elected to do what is needed — tough decisions politically but necessary all the same.

The NDP will stand here speaker after speaker, as they are doing, saying that there hasn't been enough analysis, that the Finance Committee should, essentially, do a tour of B.C. to find out what has already been established as fact.

Fact: they are against the HST and against the PST. What is notable is that they do not want to remove the PST and won't remove the HST.

Fact: very few people in the province would ever elect to pay more taxes. We know that very few under-
[ Page 4817 ]
stand that this debate is about stalling the removal of a PST.

Fact: the employers of British Columbia are in favour of this. We have paper after paper after paper that analyzes and concludes that the HST is the right thing for B.C.

Fact: 130 countries have done the analysis and decided it was the right way to go for their economy.

Fact: Ontario, the largest province in Canada, has done the analysis and found that it's the right way to go for Ontario's economy.

Fact: B.C. does not want to be at a competitive disadvantage with Ontario, our biggest trading partner and, internally, our biggest competitor.

Fact: as Canada's Pacific gateway province we have enormous opportunity. We've been spending a great deal of time and effort on promoting and cementing that opportunity. To fully realize that opportunity, we have to be competitive internationally. Investors are savvy, not gullible. Investors look for the best opportunities, not the most expensive.

We know there's a lot of misinformation floating about, Madam Speaker, but the fact is that this is the right move for British Columbia and for British Columbians. The analysis has been done. The HST gets a big thumbs-up.

I know that the opposition would like us to put B.C. in limbo, but I'm not prepared to do that. That's why I am against this motion to refer Bill 9 back to the Finance Committee.

During this debate one member of the opposition spent no time at all on facts, but in an attempt at humour…. Even in that attempt at humour, he was factually incorrect. I think that it's a shame that in an entire speech in this debate, all the time was wasted on storytelling and no facts — no alternative proposition, just a meagre attempt at humour.

Using a couple of further examples, I'd like to remind the members opposite of a few more facts.

Fact: a senior couple on a $30,000 income might pay about $1,000 per year in HST. That's compared to the current tax regime, where they would pay about $756. But when you consider that they will receive the HST tax credits, you realize, in fact, that it will make no real difference to them at all.

Fact: under the HST, B.C. businesses will no longer pay tax on input costs, resulting in a savings of $1.9 billion — savings they can use to grow their businesses, to pay higher wages or to reduce prices, whichever will keep their business competitive.

It is clear — it is crystal-clear, in fact — that the benefits of the HST have been demonstrated time and time again. We don't need to send this to another committee. We are debating it here in this House, which is what we were tasked to do as legislators on behalf of our constituents. We have had the opportunity, and it is time to move on.

V. Huntington: I rise today to address the amendment and to express what my head is telling is me, what my heart is telling me and, most importantly, what my constituency is telling me about the HST.

[1510]

The fact that I'm here at all reflects what happens when a government breaks its bond with the people. Last May the people of Delta South sent a message. They are tired of the same old top-down edicts, the same old failure to listen, the same old manipulation, the same old focus on partisan politics instead of the people's interests.

With the introduction of the HST, this government demonstrates that it still doesn't get that message, and I've concluded that it never will. It is wilfully blind to a deep and growing dissatisfaction among British Columbians. People are angry about the HST, angry enough to publicly demonstrate their complete lack of confidence in this government, and that anger is crossing a threshold of tolerance. People are no longer just disengaged. They are ready to bring their government to account through unprecedented action.

With the opportunity to move this debate into committee, we can take a deep, collective breath, examine the full impact of this tax shift in detail, and allow the public to have an active and effective role. If it is as good for us as the Finance Minister maintains, surely allowing oxygen into the discussion would be a good thing — something to be encouraged, not feared.

I do not intend to repeat all of the critical points made in this chamber about this massive tax shift, but I will state for the record what the hobbled members of the government's side know but are not free to say: people hate this tax. They hate being played for fools by a paternalistic government that assumes everyone would eventually accept this radical shift. They hate being insulted by the attitude that government knows best and: "If only you understood it better, you would agree with us."

The people of Delta South are telling me that this tax, in its present form, is wrong. It is a colossal transfer, a financial burden from the industrial sector to the consumers of this province. It was announced seemingly overnight and presented in its final form to the people without study and without discussion. Scariest of all, it was built on economic pixie dust.

The immediate effect on taxpayers is tangible and negative. The vague, long-term promise of trickle-down prosperity is based on the principle known as wishing and hoping. In other words, eventually our happy and prosperous industries will gleefully share their future largesse with consumers. Well, as the old saying goes, rub a lamp.

My colleague from Delta North spoke of the fundamentals of democracy as discussed by John Dewey. Dewey was a man who believed, as I do, that human beings are capable of intelligent judgment when they are
[ Page 4818 ]
faced with facts, consulted openly and respectfully and are confident that their common sense will be reflected in government policy.

These fundamentals have been ignored by this government, which is on a determined march to change our process from one of consulting with and representing the people, to one of listening to and representing large business. This government is in the process of changing our system from one of representative democracy to one of government by corporate oligarchy.

If this government truly believed in the people, it would have told them the truth about bringing in the HST. It would have said: "We have an unconscionably large deficit, and we need the transition money from the federal government." Or it could have said: "The financial state of the province is such that we need to provide every single competitive opportunity we can to the large corporations, corporations that used to provide the all-important resource revenues to this province."

It could have argued that small business overhead will also benefit to some small degree by the administrative efficiencies of a single tax. And it could have — should have — said it before they stole the last election, not immediately afterward.

But it didn't tell the truth; it hid the truth. It unexpectedly and unbelievably shafted its own people with a tax grab that has shifted the tax burden of this province onto the backs of consumers. It really should be called the shaft-and-grab tax — shafts the people by grabbing their money and gifting it to the industrial sector.

A forestry spokesman said in the Globe and Mail last Friday that the HST is critical for the future of our industry. But if it's so critical, where have they been in the nine years that this government has been in power? By what strange coincidence did the HST suddenly become the single most important thing the government can do for the corporate sector? I thought that their big problem was the municipal property tax.

[1515]

What is this government really doing? Why is it causing the population of this province to experience agony and even hate? Why has it shifted the tax burden when there is not even a pretence that the HST will be a net benefit to the treasury?

As political commentator Vaughn Palmer has pointed out, the HST will actually be a net loss to the government — not just revenue-neutral, but an actual loss. So why? Well, there are 1.6 billion reasons, and even the corporate demand for lower taxes was secondary to lowering a deficit that had somehow magically quadrupled during the election.

The truth is that the HST is here in return for a one-time, $1.6 billion bribe from the federal government, which I guess is the modern equivalent of 30 pieces of silver. So on top of hydro increases, MSP increases, TransLink increases, ferry increases, property tax increases, permit increases, camping increases, carbon tax increases…. On top of it all, the people have….

Interjections.

Deputy Speaker: Members. Members.

Delta South, please take your seat for a moment.

Please continue.

V. Huntington: On top of it all, now the people have to absorb a 7 percent higher cost on every service and every good not specifically exempted from the HST.

Hon. Speaker, my constituents want to be heard. In fact, I have been approached by people from other ridings who despair that their MLAs are not listening to them, and what I'm hearing from our constituents is scaring me. I hear anger, I hear despair, and worse yet, I hear people planning on breaking the law.

I was shocked two weeks ago when a woman came into my office — a senior, a solid citizen who lives on a fixed income. She told me that she had done her homework and that the HST "is going to do her under." She told me that her only option is to cheat, to stop declaring her income. She said, when I asked: "I'm not giving you my name because I'm going underground. I'm going underground, and I want you to pass that on to the government." At least she had the courage to tell the truth, and I can tell that you this lovely lady will not be alone.

She will be joined by cleaning ladies, hairdressers, tree cutters, painters, carpenters, gardeners, plumbers, electricians, piano tuners, carpet cleaners, music teachers, locksmiths, bookkeepers, house sitters, delivery companies — all the self-employed men and women who work hard to make ends meet and who are reaching a breaking point, the point at which disposable income is becoming a thing of the past. This burgeoning underground economy will be a huge unintended consequence of the HST and a huge unintended loss of revenue to both senior levels of government.

Jared Diamond, in his book Guns, Germs, and Steel, points out that throughout human history, all leaders steal from those they lead. The citizens know this, and so long as they feel they're getting a fair deal, they'll accept the taxes they are forced to pay. But when the balance of payments tips too far, the citizens get rid of their leaders.

The enthusiasm people across British Columbia are showing for the initiative process is a testament to this principle. Simply, the citizens no longer think they are getting a fair deal, and therein lies the rub.

The government has deserted the voter. Nothing it says can be believed, and nothing it does will be believed. The voters, the people, are now deserting their government, the most dangerous of situations democracy can endure.
[ Page 4819 ]

Allowing this bill to be sent to committee in order to hold a fair, productive, and thorough review might help allay the current temptation of British Columbians to abandon their government. It's not too late.

[1520]

To quote from a letter in the Vancouver Sun from Peter Light of Roberts Creek:

"The harmonized sales tax makes me resolve to spend less and make do with less, to simplify, to revel in "small is beautiful," to get it from Mother Earth instead of the store, to delight in making and growing it myself, to be willing to trade and to barter, to commit myself more deeply to the informal and underground economy, to practise survival skills I'm going to need in the future anyway, to work harder at becoming downwardly immobile, to divorce myself as far as possible from everything official, to rejoice as I become freer and freer from the system."

Surely, this poignant yet frightening statement is not what the government had in mind when it foisted this tax shift onto British Columbians.

The Premier said that before the election the HST was not on their radar. Well, it is now, and if this government continues to defy the wishes and the common sense of the people, it does so at their peril.

Hon. M. Polak: I rise today to speak in opposition to the motion that has been proposed to refer Bill 9 to a committee, specifically the Finance and Government Services Committee of the Legislature.

I'm going to take a little bit of a different tactic than most of our speakers, because I want to actually talk about the motion itself, the bill itself, what the bill actually says and what the potential outcome of sending this bill to a committee might be. To do that, I thought I would begin by talking about the arguably poor logic of the opposition in suggesting that somehow taking this bill to committee would afford government the opportunity to change its mind based on some new facts.

Now, I find that quite remarkable because of course, as we've heard from the independent member opposite and as we've heard from members of the opposition, the very thing that they are most opposed to is that this government chose at a certain point in time to change its mind based on new facts. So it is wholly inconsistent for them to proceed to suggest that a motion to send this bill to committee would result in a positive outcome, given that they are opposed to government changing its mind based on facts. But I'll give them that for a moment.

Let's consider, if we might, what new facts the opposition may want government to consider. Well, we don't actually have to look very far because speaker after speaker after speaker on the opposing benches has told us what those new facts are. They are the polls — the polls.

I have listened as I've sat in this House, and as I've watched on the television, to the debate taking place in this chamber. To date, the only new fact that the opposition has presented that would suggest that government ought to change its position with respect to the HST is the lack of popularity that the tax enjoys or does not enjoy, as the case may be. I can only conclude that if the opposition were to form government, they would make their tax policy decisions not based on the facts, not based on what's good for British Columbians but based on polls.

I can imagine that they would probably take a poll and take the results and make all their decisions based on that. In fact, we already have some examples of that, in the case of the carbon tax. We heard just about as much opposition from that side of the House about the carbon tax as we're hearing now about the HST. We certainly heard it out on the campaign trail, and yet as poll results changed, voila. Voila — the opposition had an epiphany.

They suddenly decided that because the poll results were different, they would change their principles with respect to the carbon tax. Now, that's fine. I'm happy that they've come around to seeing the benefit of the carbon tax and supporting the view that government proposed initially. Nevertheless, it was clearly a case of changing their view based on the poll results, not based on what their fundamental beliefs were.

The Port Mann bridge is another good example. In fact, I don't think the opposition has yet landed on a position, because every time the Leader of the Opposition wishes to speak about the Port Mann bridge, what the Leader of the Opposition does is decide: "Well, gee, which region of the province am I in today? I better tailor my comments based on that." She wouldn't dare go to Surrey or Langley and say she opposes the Port Mann bridge, but she'll say it in downtown Vancouver.

Again, another example of how this opposition government would perhaps choose to make decisions — not based on what's in the best interests of British Columbians, not based on what the real facts are. Certainly, they would not have the courage to change their view when it became apparent that there were new facts in play, if they knew that their decision was going to be unpopular.

[1525]

That's what representative democracy is all about. We've heard many of our speakers talk about how this is undemocratic. What I can say to them is they clearly do not understand what their role is in a representative democracy, because in a representative democracy, you are elected to make decisions based on the best information you have and how that relates to the best interests of the public you serve. It does not mean that you go out and take a poll every time you make a decision.

It also means there are times when you are going to have to face the very uncomfortable position of having to support something because you know in your conscience it's the right thing to do, in spite of the fact that your friends, your neighbours or your supporters are not going to understand and are not going to like you
[ Page 4820 ]
for it, and they're going to let you know. If it's the right thing to do, then it's the right thing to do whether it's popular or not.

I wonder: if it isn't a matter of them wanting government to change its mind, because that's inconsistent with their other positions, then why else would they want to refer this matter to a committee? In thinking about this, I thought perhaps the answer is in the substance of the bill. I have a feeling that just might be it, because by referring this to a committee, they would be successful in taking away the vote that they are going to have to cast as we come to the end of debate on this bill.

Of course, what they have neglected to talk about as we've debated this in the House is that the bill is essentially about two things. It's about repealing the PST, getting rid of the PST, and it's about making sure that the various rebates and exemptions and tax credits are in place to ensure that we protect low-income British Columbians and make sure that this transition to HST is successful. Those are the two things — getting rid of the PST and making sure there are sufficient tax credits and rebates in place.

Well, that gives us an indication right there. That makes a lot of sense. They don't want to have to vote on that. Can you imagine having to go to your constituent and say: "Well, actually, I voted against getting rid of the PST." Can you imagine what reaction you'd get from that? I know what I'd get in my riding. It would be pretty bad. But maybe that's their position.

Maybe they want to keep the PST. I don't think so. I think, quite frankly, the reason that they want to refer this to a committee is because they are absolutely petrified of having to get into a debate about what's really in this bill. They're much happier to tell the newspapers and the television that this is about a bill that would implement the HST. They know that's not true. Nevertheless, they're happy to say it. They don't want to talk about getting rid of the PST because they don't want to have to tell people they're going to vote against that.

Who knows? Maybe they'll even change their minds and vote in favour of getting rid of the PST. Right now they don't want to talk about the various tax credits and other features that are going to offset the costs for low-income householders, because they don't want to tell British Columbians that they're going to vote against that.

I would suggest that they ought to really consider whether or not that strategy would have the kind of impact that they are perhaps expecting, in that they'd be able to avoid voting on this very tricky issue for them. I got to thinking that since that's what the bill is really about, then I wonder what would happen if we started to talk about that in a committee. What would happen if we started asking British Columbians if they wanted to get rid of the PST?

Given what has happened at the Finance and Government Services Committee over the many, many years that the PST has been pilloried by small businesses, big businesses, individuals coming time and time again to that committee to talk about how destructive the provincial sales tax is, how costly it is for business and how much it impedes our productivity in British Columbia, one can only draw the conclusion that if this Finance and Government Services Committee was to discuss the potential repeal of the PST, there would be a resounding recommendation to continue on and to get rid of it.

And if one was to talk at a committee about what would happen if we didn't have in place rebates, if we didn't have in place exemptions, if we didn't have in place credits for those who are low and middle income, they would of course recommend that those things need to be passed.

[1530]

I can only suggest that the members opposite may wish to be the ones who change their minds based on new facts, because this bill is about repealing the PST and it is about providing for those very important tax credits and rebates and those things that are going to ease the transition, especially for low- and middle-income people.

[C. Trevena in the chair.]

I hope that the opposition members have a very good reason by which they're going to explain to their constituents why they would vote not to repeal the PST. But I suspect not. I suspect…. And I'm sure the next member after me will continue in this same vein. I expect that they will stay along the same lines that they have. They cannot afford for the public to know that this is a vote to get rid of the PST, and they cannot afford for the public to know that this is a vote to implement rebates and exemptions and credits for those who are low- and middle-income.

As a result of that, they want to send this to a committee so they can avoid that very difficult vote. I'll be interested if there are any of their members who rise subsequent to this and explain why it is they cannot debate the repeal of the PST and they cannot debate the implementation of the very many credits and rebates that we will be putting into place. I know. I'm quite certain that they will not, and that precisely proves my point that it is….

So I will conclude my remarks by simply challenging the opposition to debate the substance not only of this motion but, subsequent to dealing with this motion, with the bill itself, with the subject matter contained therein, and not to continue on this rather deceptive debate course of debating whether or not this is the implementation of the HST and whether it's appropriate. As the members across the way who are smiling very well know, that's not what this bill is about. So I chal-
[ Page 4821 ]
lenge them, and I hope that some of them will rise to that challenge.

M. Sather: Well, I'm very pleased to rise to speak to the amendment, which says: "Be it resolved that Bill 9 not be read a second time now but that the subject matter be forwarded to the Select Standing Committee on Finance and Government Services and further that the committee be empowered to invite witnesses to appear before it to assist in its deliberation."

It's getting curiouser and curiouser to listen to the members opposite, to the government side. It's like they're in some kind of alternate reality where they think now that this discussion is no longer — I guess maybe they thought it never was — about the HST. In fact, listening to the members opposite, and the Minister of Children and Family Development for one, they think that this discussion is simply about getting rid of the PST. It's all about getting rid of the PST. If the people of British Columbia…. In fact, they would suggest, and they do suggest, that we daren't go and tell the people of British Columbia this fact.

Now, I really think that the members opposite ought to get out more, because the fact is that the people of British Columbia are very aware of what this bill is about. They're not fooled by any nonsense about this being about the PST. They know, in fact, very well. And the members opposite…. I don't know if the members opposite know any more.

I think they've gotten extremely confused, probably distraught. I mean, I can imagine if I was on their side of the House, I might feel a tad distraught about the goings on in this province right now, including the goings on in their own caucus. It must be disturbing.

[1535]

Nonetheless, it doesn't really advance the discussion, and the minister said she wanted to advance the discussion. It doesn't serve to advance the discussion at all to pretend that the whole subject matter here is about the HST, which, of course, it is.

Interjection.

M. Sather: The member opposite says: "Read the bill." Well, you know, Madam Speaker, I would suggest to the member opposite that she go out and talk to her constituents. They will tell her, one after the other, what this is all about.

I've been collecting signatures from folks, and I'll tell you that they come from all walks of life, all political stripes, and they're adamant. And they're not confused. The members opposite, the minister, said…. "Oh well, they're basically confused," is what she is saying. "The people of British Columbia are misled." Well, they have been misled, but certainly not by our side. I don't think, actually, notwithstanding the ham-fisted attempts by the government members…. They're not misled. The people of British Columbia aren't misled by them either.

It would behoove the members opposite, the government members, to just recognize and accept that the people of British Columbia reject this tax. They reject it thoroughly. But I don't see any indication, now that we've been going over this for a bit…. This is my second speech, and other members have made second speeches — the member for Surrey-Panorama and others. There's no indication that the government is getting it. I can only suggest to them that they get out and go talk to their constituents if they want to find out what's going on.

I know the member for Maple Ridge–Mission was talking to some of his constituents at the rally that Bill Vander Zalm hosted in Maple Ridge a while back. You know, I don't think he was getting a very receptive ear. He wasn't getting a receptive ear. Well, at least he was out there. I'll give that for him, although I haven't seen much of him since.

The other members have talked about this business about us not being in favour of reducing the provincial sales tax. The member for West Vancouver–Capilano mentioned that last week. In fact, he said that this is a subject that shouldn't even be brought up in this House, that we shouldn't even be discussing this. I'm sure the members opposite, including the member for West Vancouver–Capilano, would prefer that we weren't discussing this issue. I imagine they would like to wave a magic wand and make all the bad things go away, but it isn't about to happen, so they'll have to grin and bear it.

I know some of the members opposite, the member for Kelowna–Lake Country, are a bit touchy about the subject and the discussions that take place in this House. I guess that's what you can expect when you're on the wrong side of 82 percent of British Columbians. You would get a little bit touchy. You would get a bit concerned about the debate that you're hearing, not only in this House but particularly out there in the community.

The other curious thing that I heard last week…. It was the end of the week, and the member might be forgiven for that. He is a learned member, the member for West Vancouver–Capilano, a sincere individual, but he was saying that there's been a flip-flop in the media over whether or not the Liberals told the truth about the HST. I thought that was a curious interpretation. He said that there had been a lot of briefings just after the election, and we've all heard about the discussions that took place.

We found out through freedom-of-information requests that there were discussions that took place with bureaucrats and government officials some three days after the election. The member was, in effect, suggesting that the Premier had said during the debate, during the election, that $495 million was going to be the maximum deficit that this province was going to face.
[ Page 4822 ]

This is a good opportunity for the government to take the suggestion of the opposition. I know the minister was very disparaging about the suggestion to refer this to committee and is suggesting that we're trying to avoid a vote, which I thought was one of the more curious interpretations. But I think it's a very good opportunity for the government.

[1540]

They're always going on about how the NDP never has any positive suggestions. Well, here's a positive suggestion for the government. We're trying to help you; we really are. But what can you do for a government that's beyond help? It's very difficult. It's very difficult for us to lend a helping hand for a government that's so mired in the mess, so mired in the mud, that they can't even recognize help when they see it.

Interjection.

M. Sather: Well, yeah, I know that the member has some problems with some of the issues that are discussed, but that's his prerogative, and I'm sure that he will continue to express his opinion.

The line goes about this apparent flip-flop — in the media, if nowhere else — that an official says: "You know what? It appears that we have a problem. But we have a solution. Don't worry." The member for West Vancouver–Capilano said: "That's the thing about bureaucrats. They never want to give you bad news without a solution, so they came forward with a solution saying, 'Aha, you can sign up for the HST, and that can take care of this little deficit issue we've got going here.'"

That would assume, then, that that member thinks the decision on the HST was made three days after the election. Okay. Perhaps not very believable in the minds of a lot of British Columbians. I know that the government doesn't want to talk to them, but of course, we are. I have been, and that's one of the things that really upsets them about this tax.

They do not believe the line that they've been given by this government about what took place preceding the election, during the election or after the election, and that's going to hang around for a long, long time. This government is going to feel the effects of what took place at that time.

Following along, again, the storyline regarding the flip-flop, there's a presumption that the Premier and, presumably, the Finance Minister had no idea that the deficit was going to be, like, three and a half times — whatever it is, or around there — from what they said it was going to be. I mean, it's the Finance Minister's job to tell the Premier about the state of the province's finances. I know that he's the Deputy Premier and that he's, I guess, even quite close to the Premier. One can assume that they have had some discussions both at that time and, of course, now.

Again, getting back to the member for West Vancouver–Capilano, the member said that the argument is reduced to, "They made the decision too soon after the election," and to that part he agrees. I've heard some of his colleagues express that same opinion that this rush decision was made too soon after the election, and that's the problem.

The fact is this. The issue is that it's not credible that the Liberals really believed that the deficit would be $495 million max, as the Premier said. That's where the unbelievability factor comes in, and that's the problem — one of the major problems that this government is facing. You know, they should at least stick to the matter of discussing the HST instead of kind of wishing — this wishing and hoping — that it's going to go away.

What did the Premier and the Finance Minister say to those officials during the election, in the pre-election period? What did they tell them? "If you know there's going to be a higher deficit, if it's going up, don't tell us." Is that what they were told to do? Or did they just suddenly discover this magically out of the air, and it was a huge surprise to everyone?

Madam Speaker, there are sins of commission, and there are sins of omission, but they're all sins. One's as bad as the other. You know, it's time…. Well, it's like the members could think of this referral and the Standing Committee on Finance and Government Services as a kind of truth and reconciliation committee. This would be the opportunity to come clean.

[1545]

It's not like the Premier has never repented in his life. I mean, there was a little matter one time of a holiday he had in another country. He was able to do that at that time, so it's not inconceivable, one would think, that he could do so again — maybe at the end of this week or during this week, as the government has clearly indicated that they're not going to talk about this uncomfortable issue any longer than this week.

There are a number of days left. It's only Monday. Perhaps the Premier will become contrite, or maybe it'll have to be the Finance Minister on his behalf that will do some of the apologizing, I would suggest humbly that it would be wise for the government to do.

It's interesting to hear what the former Finance Minister had to say — some very discouraging words about what this government knew and what they've done. I wouldn't doubt, now, that some of the members on the government side had, at least — I'm not sure about currently; maybe even currently — a pretty good opinion of Carole Taylor when she was Finance Minister.

You would think perhaps that her words might have some effect on the members opposite, particularly the Premier and the Finance Minister. But it would look bad for the Finance Minister, I guess, if he were to do that.

The committee is a good idea. The referral to the committee is a good idea. Witnesses can be called. It would
[ Page 4823 ]
be in order, certainly, to have the Premier come and be a witness. I mean, if he wanted to plead no contest, that's okay. Whatever he prefers to do, it's all right on our side, and I'm sure the people of British Columbia would find that better than the nothing at all that we've been getting so far, that they've been getting so far.

It's not really a problem for us if the government annoys us or ignores us or anything like that, but it's really a problem for them when they start bothering the people of British Columbia to such considerable extent that….

The thing that they're saying to me, as I collect those hundreds and hundreds of signatures of people that are upset with the government, is, "You know, I voted Liberal, but you aren't going to see that happen next time for sure," and a lot of things that are much less kind and not repeatable, nor would I want to. Nonetheless, there's a large degree of discontent with this government.

The government and some of the larger businesses say that the PST is getting passed on to consumers by being built into the price of the goods they produce. Another member, the member for Surrey-Panorama, mentioned Jon Kesselman, the economist who recently wrote that "40 percent of the $5 billion in annual PST revenues falls directly on business rather than consumers."

It seems to me that any reasonable person would say that he's saying, in effect, that if it's being passed on to consumers…. He wouldn't make that statement. He said that it falls directly on business rather than consumers, but he goes on to say that the $1.9 billion in PST currently paid by business gets built into the prices they charge consumers. In other words, he now seems to be saying it gets passed on to consumers.

Which is it? Does the PST get passed on to consumers or not? I think this is one of the cruxes of the discussion, if the minister wanted to talk about the issues, because if it's not falling on business, it is falling on consumers.

It seems to me that business has two choices here. They can pass the PST cost on to the consumer, they can take the hit themselves in terms of their own revenue, or they can do some combination of the two. But if business is passing all its current PST costs on to the consumer, the argument that the PST is a big impediment to business is weak, because if they're not taking the hit, what's the problem?

[1550]

My guess is that business is not currently passing on all their PST costs to the consumer, and therefore, they like the HST because the HST tax credits will allow them to get reimbursed for all their PST costs.

It's a net benefit to them certainly, and it's very kind of the government towards, you know, those mining and forestry companies. But when is the government going to extend that kind of kindness to the average taxpayer in British Columbia? That's what people in my constituency want to know. Why aren't we getting all this love and kindness that mining companies and forestry companies are getting? They don't see it. They're worried about it.

One of the groups of people that I've talked to a fair bit in my constituency that are concerned about it is realtors. The government moved up the exemption on new houses to $525,000, but there are lots of houses in the newer areas in Maple Ridge, up in Silver Valley and north Maple Ridge — which incidentally, has considerably more Liberal supporters or, I should say, did have considerably more Liberal supporters than NDP supporters.

Houses up there run around 600 grand easily. So they are going to be paying a new tax, around five grand. That makes a difference to people, even though the Minister for Mining, who told the House that he was a realtor at one time, said: "Ha, it's no big deal — $20,000, $30,000. Prices go up and down. You make deals. Realtors are all flexible. It's not going to have an impact on people paying their realtors."

I don't know how the Minister for Mining, the former realtor, did business. But it seems it must be a little bit different than the way the realtors in my community that are talking to me are doing business, because they are concerned about the HST and what effect it's going to have on their customers and on them as a result. We know that people are….

There's a bit of a bump right now because people are rushing out to make their deals for new houses before the July 1 deadline hits. They're very worried. Sure, they're glad for the uptick in business right now, but they're very worried what's going to happen in the weeks and months and beyond, after July 1.

People do look at the tax they're paying — the transfer tax, additional tax — and the government will know that people are very upset about that all the time. So this is going to be a real concern. A lot of the realtors in my community are banding together to sign the initiative petition to try to bring this government to their senses and to stop this, what they consider, insanity.

You know, a lot of them, quite frankly, are not traditional NDP supporters. It's fun and interesting to work with them. They have a lot of information and a lot of knowledge about the community. Again, I don't know who, if anybody, the government members are talking to when it comes to the HST. It doesn't seem like they're talking to realtors, certainly not in my community, and then there's a whole host of other people that have been talked about before that this government surely also cannot be communicating with.

As one realtor said to me, it's not just the HST they pay on a higher-priced home in Maple Ridge. It's not a higher-priced home in Vancouver. You couldn't get a home in Vancouver for 600 grand or probably not a new home in the highlands in Coquitlam either. I'm sure you couldn't.

[1555]

He says that they have to borrow that money as well. Very few people come with all the cash, money in hand. They've got a mortgage, and they're going to have to pay interest on that. It's not just the upfront tax that they're going to have to pay, but they're going to have to pay the interest on the money they borrow to pay that tax.

You know, of course, there's the realtor's commission tax that they're going to have to pay and on and on — home inspectors, appraisers, notaries public, conveyances. All this stuff adds up, and it's a real disincentive.

Why the government…. I understand that they felt desperate after the election to come to some kind of…. There wasn't going to be an explanation that it wasn't $495 million max in terms of the deficit, but they needed something to try to ease the pain. It's sadly ironic, on their side of the House, that the thing they chose to alleviate the pain is causing them maximum pain.

So you make some choices. It's nothing to do…. Well, maybe it is to do with the polls, but I don't know. The Minister of Children and Family Development said that everything that is done on this side of the House has to do with polling. I guess that members opposite, the government, don't look at those things. Maybe they don't have to look at the polls. As I said, they just have to go out and talk to their constituents.

I think a referral of this bill to the select standing committee is a really good idea, and it's too bad that the government doesn't share my enthusiasm for it. So they will continue in that vein as well, I guess.

One of my constituents actually…. I want to read what he had to say. He writes not infrequently to the local papers, and I see him from time to time walking the dikes. He's a learned individual. He said:

"Then comes the HST. The HST on the registered massage therapy that I use to control my fibromyalgia will come to a whopping $875 more for just that one item of my health care next year. So the government can not only claim how much more health care has gone up but justify even more cuts with a straight face.

"So next year I am looking at a personal increase in taxes on my small, fixed pension of between $2,000 and $3,000, and the government can claim what great financial wizards they are."

That's from one of my constituents who does rely a great deal on massage therapy. The minister opposite will know that for some strange reason this government chose not to give any break to registered massage therapists.

I understand the situation for those folks because it just so happens that I have a family member who is a registered massage therapist, and it's tough for her. She's just starting out in her business, and they're not getting the same breaks that some other people have gotten, for some reason. The government has certainly cherry-picked on what they're going to give exemptions for and what they're not.

I think during question period today it might have come up about small businesses. Maybe it was the minister for whatever he is. I forgot what he is minister for over there, but the minister from North Thompson. He or someone was talking about all these businesses and how they're in favour. We hear this refrain on and on.

Of course, if you're a restaurant owner, there's a good reason. Not only is it a new tax for you and your customers that you didn't have to face before, but restaurant owners' costs primarily are buying food and paying their staff. Neither of those…. You're not going to get any input tax credit for those. It's a dead loss for them.

[1600]

I was talking to one of them about the petition the other day, and he's livid. He's absolutely livid. I was talking to him on Friday. He's got a good business going there. It's been open a couple of years now. You know, he's just expanded it. He's worried. He's worried about what's going to happen, and the people that are working for a living doing the serving are worried too.

They tell me they're concerned about…. They depend on their tips. Of course the wage is not that high, so they depend on their tips. They're very concerned that people are…. People do look at the bottom line. Looking at the gas prices, people check them very carefully.

People are very price-sensitive. They are. They look at every penny when the gas price goes up. They're going to look at that HST on their restaurant bill over and over and over, and they're likely to be less generous on their tips. That hurts. That's going to hurt the people that are working very hard to serve us in those restaurants, to serve the people of British Columbia, who need those tips. So they're also very concerned about what effect this is going to have on them — this tax, which is really nothing if you listen to the government.

If the people only understood it more carefully and if the opposition wasn't so obtuse, it could easily be explained away as being the most wonderful thing. But it's unfortunate for them, as they see it, that the people of British Columbia just don't get it. They just don't get it about the HST. They should be embracing it, according to the members opposite, but they're not. They're not about to.

I don't know how much money — millions maybe — the Minister of Finance is going to spend to try to convince them that, in fact, they're misled, which I think is only going to tick them off more and more. "Now the government is wasting more of my money. First they're going to take it away with one hand. Then they're taking it away with the other hand. No give-and-take. All take."

It's not going to be an effective tool. I don't even know if it's legal. I guess the government has checked that out, perhaps, or not. They go ahead and do these things, have done it in the past, and then they wait and see what the courts rule, because by that time they figure…. They've done pre-election manoeuvres like this before. By the time the courts get around to it, it will be too late. But it's not going to be too late.

D. Horne: I'm always amused as to some of the theories of those opposite. Obviously, in speaking to the
[ Page 4825 ]
amendment today…. Obviously, I am opposed to the amendment.

One must ask why it would be appropriate to refer the bill to the Finance Committee. What actually would be gained by referring the bill to the Finance Committee? I spent quite a bit of time thinking about this and why the members opposite would think this was such a good idea.

One of the things that seemed to always come back to the possibility of why they'd want to do this is that their leader, Mr. Vander Zalm, has no standing in this place. By referring it to the Finance Committee, their leader, Mr. Vander Zalm, would then be able to come before the committee as a witness, and he would be able to explain to us all why this is such an absolutely horrible tax. Obviously, with all of the debate that we've had in this place and that continues to go on, no one on the other side seems to be able to articulate in any real sense other than a procedural basis why, from a substantive base, the PST is so much better than the HST.

We go on, and we have speaker after speaker after speaker who talks about the procedure, how we got to where we are today. But the fact of the matter is that this bill has to do with removing the PST. This bill has to do with making way and removing the PST that's been in existence for many, many years and, obviously, moving to an HST.

[1605]

From a substantive standpoint, one would think that if you were in favour of the PST and didn't want to move to the HST, you'd have some substantive arguments as to why the PST was so much better than the HST. Speaker after speaker after speaker on the other side talks about all of the procedural issues, but nothing of substance — nothing of substance whatsoever.

The fact of the matter is that when it comes to studying the HST and why it's good and why it's better for British Columbians, we look to the 130 OECD countries that currently have a value-added tax. We sort of say to ourselves: "Is that not study? Is that not some indication that moving to a value-added tax, moving to an HST, is better than the current regressive PST that we have?"

Many of the members opposite talk about listening to our constituents. They talk about how we need to hear what our constituents have been saying. I've been getting many, many e-mails over the past couple of weeks — many more than I got, I can tell you, a month ago. To them I say one simple thing, because all of them are extremely emotional, and all of them lack any substance whatsoever. All they say is: "I don't like this tax."

What I say to them is: "Well, I'm interested in your point of view. In listening to your point of view, this argument, the substantive portion of this argument, has to do with replacing the PST with the HST." I'm interested in their standpoint as to why the PST is so much better than the HST.

One of the members opposite made the point that businesses perhaps don't pass all of the cost of the PST on to consumers. He talked about the fact that there's this $1.9 billion of the PST currently paid by businesses and that perhaps they're not passing that on. I'm not certain exactly why they wouldn't be passing that on, because a business that doesn't pass on its input costs is called one thing. It's called bankrupt. Obviously, what he's saying is that perhaps in a market society, which we live in, basic supply and demand doesn't allow them to charge enough in order to recoup all of their costs and also to make a profit.

But I look at that, and what I say is these businesses do drive to make profits. So if they cannot recoup their PST, it's not that they don't continue to recoup it. What they do is do things to look at what their overall costs are. The PST unfortunately right now is a cost that they must pay. So what do they do? They look at things like staffing because they can reduce their staff. Oh, that's called employment. When they reduce their staff and have less staff, that decreases employment.

M. Sather: What does that have to do with the HST?

D. Horne: The member opposite asks me what that has to do with the HST. It has to do with the fact, Member, that under the current PST, which businesses are passing on to consumers, basically they have no choice and that they don't get it back. To say that consumers aren't currently covering the entire cost of the PST is absolute and utter silliness.

The fact of the matter is that with the HST, they get all of their inputs back. Therefore, they have additional money to invest in their business and to hire additional staff, to basically buy new plant and equipment, to do many, many things to expand their business. When one expands their business, what do they do? Oh, they employ more people.

But that would be a bad thing. We wouldn't want to employ more people. We wouldn't want to have more people working in British Columbia, because that might stimulate our economy, and more people might actually want to come and live here.

That's just typical of NDP math, and we've heard it time and time again. I speak to many of my constituents. Many of my constituents write me e-mails. The funny thing is that many of them who send me e-mails that are on the most emotional level when it comes to the HST…. What most of them do is limit the amount of their name that they actually put at the bottom, because they're kind of scared of the fact that I might want to find out who they are.

[1610]

So they'll write, and it gets down to "G" or Greg. They try to basically hide who they are. The ones that do write me e-mails that I can find out who they are, who write
[ Page 4826 ]
their full name, I call them, and I say: "I just got this e-mail from you on the HST. I understand you have some concerns." They go: "Oh yes. I have heard from Mr. Vander Zalm and his crew that this is going to cost me thousands of dollars a month."

I say: "Well, perhaps we don't need to talk, because if it's costing you thousands of dollars a month, that means that you make, after taxes, 14,200-and-some dollars after you've paid your rent or mortgage, after you've paid for all of the other items that are currently not subject to HST or PST, all of these things that will not be subject to HST. After you have paid all these items, you have a huge amount of disposable income.

"To pay a thousand dollars a month would mean that your disposable income would have to be somewhere like $25,000 or $30,000. So if your disposable income is, indeed, $25,000 or $30,000 a month, why is this…? Quite frankly, why do you actually have the time to call and engage me on this? If you're making so much money, obviously you should be busy making money."

Then we go into the details of it. We go into the details, and they say: "Oh, I got this note." This note that keeps going out to all of the seniors and everyone else, this note that I've talked about before which is the boogeyman in the closet saying: "Oh my gosh, there's all of this. You're going to get hit with this. This is going to be horrible."

The sad part of this, as I've said before, is that on July 1 the lights come on, the closet door opens and, surprisingly enough for all of these people who have been sending all those notes around, the boogeyman won't be there.

The difficulty is that you go to these websites. You read the things that the people are saying will be subject to the HST. The number one item that keeps coming up is groceries. Then what they do is they say "some groceries." Well, not the food groceries, but the toilet paper. Yes, you're right. Toilet paper will be subject to HST, but unless you buy an awful lot of toilet paper and toothpaste, I don't think it's going to be the hundreds and thousands of dollars that those opposite would say it would be.

Then they go on: "Well, how much it costs to heat my house — my electricity, my gas bill." Well, surprisingly enough, those, too, are not subject to HST. They go: "Oh, oh, we're in big trouble now. We've already taken about 80 percent of our household budget and removed it from the equation. So it's really hard for us to come up to this thousand dollar number that has so wonderfully just spread throughout the province, that this is going to cost us a thousand dollars a month."

Then you go down into the others. The telephone bill. Oh well, the fact of this, the difficulty with this, which just makes the argument more difficult, is that you have to explain that it's only a part of the phone bill. So it's great for them to throw this out, because basically less than half of a current phone bill right now is not subject to PST. But when you have to get down to explaining that and you have to do the same thing on the cable bill, that only a very small fraction of your cable bill is currently not subject to PST, then you have to go on the whole thing.

This is the problem. When you start getting into all these half-truths that you have to basically go down and explain, what you have to say to people is: "Look at the bill. Does it have a little item on it that says PST? If it currently has a little item on it that says PST, well, surprisingly enough, that's going to become the HST, and you're already paying it."

All of this fearmongering, all of this boogeyman in the closet is just wrong.

Recently one of the members was talking to a senior. The local hardware store in the area had sent a note to the senior that said she should really get some work done. She should really buy these goods and have them, because the HST was coming in. She was going to save the HST by moving now and going and getting all of these things that she would need for her house. They pitched it this way, and because of all the things she'd heard, she'd said: "Oh yes. No, I need to save that HST. I don't have the extra money to be able to pay that HST when it comes in on July 1."

[1615]

The member talked to her, and he said: "Do you have the bill?" She said, "Yes, I have the bill. Here it is. Here are the materials and the things that I bought from the hardware store," and some of them actually hadn't even been delivered yet. Some of them were going to be delivered over time, but she had bought them. He went through the bill. Basically, all of the items — and I'm not talking about a portion of the items — on this bill were subject to PST, so the grand total of her savings by buying them now was zero. She wasn't saving anything by buying them now.

Then it gets even worse, because not only was she not saving one dime by buying these articles now with this hysteria that's going throughout the province, but basically, she actually couldn't afford all of these items, so the hardware store had put them on her account and was wonderfully charging her interest at a rate of 2 percent per month. What wonderful, wonderful individuals these were that they could save her on the HST and then charge her 2 percent a month and, even better, on items that she hadn't even received, items that she would receive later. But she'd saved the HST.

This is the difficulty we face on so many things. This is the difficulty when people don't understand that obviously, from a communications standpoint, we need to go out, and we need to talk to people more. We need to tell them that all of these things that they think the HST will now apply to and all of these horrible, horrible apocalyptic predictions that have happened from those opposite just won't come true.
[ Page 4827 ]

This is much like Y2K, when basically everyone says the sky will fall when it comes to January 1. It's just not the case.

I heard one of the members a couple of weeks ago, and they were talking about swim clubs and hockey teams and these types of groups and the fact that for their ice time and their pool time this was going to be a significant cost. Quite frankly, I heard one person say to me that they didn't think their child was going to be able to participate anymore because these costs from the HST were just going to be unbearable.

My daughter swam. I started looking into this because, obviously, the HST will be charged on some pool fees and on some arena fees for hockey players, and this type of thing. When you take a look at the gross numbers, they can be large, and this is the difficulty in many of these things. Because the gross numbers are large and people don't understand it, they get scared.

For my swim club we paid about $60,000 for pool time, and $60,000 is quite a bit of money. You start charging the HST on $60,000, and we're talking about $4,200. Again, it's a substantial amount of money, but that being said, when you divide it by the amount of families that are paying it, we're talking about $20 a family, and since they charge their fees over ten months, we're talking about $2 a month. I went to the person. I said: "Are you going to take your daughter out of the swim club over $2 a month?"

Quite frankly, the swim club, over the last two or three years, has upped their fees by $20 or $30 a month every single year. "You didn't do anything that time, but this $2 a month is the straw that's going to break the back. That's the one that you're going to say: 'Enough is enough. That $20 a month last year, that really was bad, but I lived through it. But the $2 now, I can't stand for that, and I'm going to take my daughter out of swimming because of it.'" These arguments are just silly, and they're just wrong, and there's no substance to them.

I go back to the issue that I mentioned at the beginning. One of the things that's come to light this week and one of the things that we'll be hearing an awful lot about all this week is the fact that we're not fulsomely debating the HST bill. Well, we've been debating it for quite some time now. This is my second time to get up. Many of the people on the other side have spoken twice. Most members of this House have spoken at least once. I don't think there are too many that haven't spoken at least once.

[1620]

You know, I say: "What is there left that we haven't said already?" What do we have to explore more? What little tidbit by everyone who stood up in this place, spoke and said what they believe, said what they truly think is the right thing as we move this province forward — what hasn't been said?

I challenged the members opposite when I got up the last time, speaking to the actual bill and not the amendment, as I now am. I said: "What is it about the PST that's such an admirable quality that you think that we should keep it?" What about the PST is there that just drives our economy? What about the PST is there that just makes it such a better tax as we move forward?

One of the things that was said at the beginning was that this was a tax grab. While I still, every once in a while, get a note like that, most people in British Columbia realize that the revenues from the HST will be approximately the same as the revenues from the PST. Actually, this year in our budget those revenues are a couple of hundred million dollars less than they would have been under the PST.

One of the things that we have to look at, then, is that if this isn't a way for government to generate additional revenues, if this isn't — like many who were basically propagating the boogeyman theory at the beginning — the tax grab, like they all would have wished it to be at the beginning….

Obviously, both the PST and the HST are a way of collecting taxes, and quite frankly, none of us like taxes. But the fact of the matter is, obviously, that in order to provide health care, to provide education, to provide all of the services that we as government, that we as citizens in British Columbia have come to count on and require to a great extent from our government — to provide those services — we have to collect taxes.

I ask the members opposite, and I've asked before: which is better? This bill has to do with repealing the PST. This bill has to do with removing one tax so that we move to another tax. In moving from one tax to another, one would assume that the debate would be: which is better? One would assume that the members opposite would stand in their place and say: "I believe that the PST is so much better because of blank" or "I believe that the PST is better for the economy, will create more jobs, will allow businesses to flourish more than the HST." You know, we just haven't heard that.

We haven't heard that because there's simply no one in this House, either on this side or the other side, who believes that. While it's wonderful political theatre to stand up and talk about the process of how we got to where we got to right now, as I pointed out during my first speech, I heard about the HST the same week as those opposite did.

The difference between the way I've approached it and the way it appears that most of the members opposite have approached it is that I actually looked into the issue of which tax is better: if this is the way we're moving, is this the right thing to do? Is the HST, in the long run for our economy, for creating jobs, for making sure that this province prospers and is successful, the right thing to do? Resoundingly.

If you ask anyone to get outside of the political theatre, if you ask anyone that basically takes a look at the economy, that takes a look at creating jobs, that takes
[ Page 4828 ]
a look at all of the benefits that this creates, "Is this the right thing to do?" you'll hear time and time again that the answer is yes.

[1625]

The answer is yes from the B.C. Agriculture Council. The answer is yes from the B.C. Business Council. The answer is yes from the B.C. Chamber of Commerce; the B.C. Lumber Trade Council; the Canada West Foundation; the Coast Forest Products Association; the Conference Board of Canada; the Chartered Accountants of British Columbia; the Canadian Manufacturers and Exporters; the Certified General Accountants; the Mining Association of B.C.; the Retail Council of Canada; the B.C. Trucking Association; the B.C. Road Builders and Heavy Construction Association; the New Car Dealers Association of British Columbia; the British Columbia Construction Association; the B.C. Pulp and Paper Steering Committee; the Truck Loggers Association; the Motion Picture Industry Association of B.C.; the Greater Vancouver Gateway Council; the Railway Association of Canada; the Independent Contractors of B.C.; Initiatives Prince George; the Canadian Association of Petroleum Producers; the Association for Mineral Exploration B.C.; New Media B.C. — Ken Low, who I know very, very well; the B.C. Shellfish Growers Association.

This is a list of people who have all said yes. This is a list that represents a huge cross-section of the economy in British Columbia. This is a list that represents many, many, many employers in British Columbia — small businesses, people that make sure that we have the things, that we are employed, that we enjoy the standard of living and that we continue to flourish and prosper.

The other group that all says yes are the economists. Well, one of the members on our side was a very distinguished member of that profession in his past. Some might say that if you take a look at the recession last year, perhaps economists aren't always right. The fact of the matter is that if you're going to look to any group as to what is best for the economy, no one has a crystal ball. No one can say: "This is what's going to happen in the future, and I stake my life on it."

The fact of the matter is that anyone that knows what's truly going to happen in the future should buy a few lottery tickets and then not worry about anything from now on. Obviously, they're going to be very, very well off and not have many concerns. The fact of the matter is that that's simply not reality.

Basically, people look at certain factors. They look at certain ways that the economy will adjust, that the economy will react to certain items. They take those factors, and they make predictions. In coming to those predictions, one of the factors that they look at is taxation policy and how that will affect our country and our province.

When the economists are saying, one after another after another, that this is a good thing for British Columbia, that this is a good thing for our province to create jobs, to build on the success that we've had in the past, to build for our children, then this is not a prediction as to what may happen. This is basically an opinion as to what is better than something else, and the HST is indeed better than the PST.

One of the things that this amendment does is it talks about — and I talked about it at the beginning — sending this bill to the Finance Committee, allowing the Finance Committee to take a look at it and to invite witnesses.

One of the things that I am interested in is that, of those witnesses, would you not have all of the economists come to the committee — the economists who have already stated their position, the economists who have said that they are in favour of the HST and that they endorse the HST, and who say it's a good thing for our province? Would you not have all of the employers, all of the long list of the group that I just read, come to the committee and say that the HST is a great thing for our province, something that we all will do very, very well from and that our province will prosper from?

[1630]

Obviously, you'd have those two groups. Then you would have another group. You'd have the leader of those opposite, Mr. Vander Zalm, who would come and talk about the boogeyman. He would basically tell you how terrible this is based upon his strong economic knowledge and wonderful track record in business.

He would tell you that this process was a bad one. The thing he wouldn't tell you is that the substance of this is wrong. He wouldn't tell you that the PST is a better tax than the HST. He wouldn't tell you that the province will prosper more under the PST.

We go back to the overall process of this. Some have said that we don't have a mandate. I tend to differ on that subject, and I have resoundingly said to many, many people within my riding that the ballot question in the last election was: who is best to lead our economy through these difficult times? That resoundingly continues to be the government and the B.C. Liberal Party.

The B.C. Liberal Party has worked hard over many, many years to reduce taxes in all of the things that this government has done over the many years it's been in office, has worked to ensure that we have the economic foundation in order for our economy and our province to prosper in the long run.

I say that the HST is just one more step forward in order to make sure that in the long run our businesses continue to prosper, that British Columbians continue to be employed, that we as British Columbians continue to be successful in the long term and that our children continue from a wonderful foundation that we've all set for them. That's why I'm opposed to this amendment, and that's why I'll be voting against it.

H. Bains: I'm rising to speak in favour of this amendment and for a number of good reasons why we need to
[ Page 4829 ]
send this back to the Standing Committee on Finance and Government Services.

For the record, let me read this amendment. "Be it resolved that Bill 9 not be read a second time now but that the subject matter be forwarded to the Select Standing Committee on Finance and Government Services and further that the committee be empowered to invite witnesses to appear before it to assist in its deliberation."

I say that this is one of the better ways of dealing with this issue. On the original bill, people were standing up on one side of the House in favour of the HST, and on this side of the House, for good reason, we are standing up against the implementation of the HST.

This amendment actually will do a service to the Liberals on the other side. It will give them an opportunity to go back to those people who have been offended by the way the HST was brought in. They will have an opportunity to go back to them and listen to their concerns.

All the reasons that the Liberal members stand up here — why HST is good…. It will give them an opportunity to go and talk to those folks and let them hear directly from those folks why they don't believe the HST is good for them.

Before I go into the real reasons why I think this is a good amendment, I just want to comment on the previous speaker, the member for Coquitlam–Burke Mountain. What a display of typical Liberal arrogance was displayed here in the last half an hour. First, the member said that he has received numerous e-mails and phone calls, and that he picked up a phone…. Anywhere he could find a phone for those people, he phoned them and talked to them.

[1635]

He's saying, here in this House, that all those folks who are concerned about the HST are emotional, that it's only emotional — that it's emotions that are getting in the way, nothing else. "They don't know exactly what they are talking about" is what this member was saying.

That's what you hear from member after member after member from that side of the House. I have seen in the last five years that they haven't changed a bit. They haven't changed a bit. In fact, they've got worse. They've got worse when it comes to showing arrogance towards the voters, the very voters who actually elected them and put them in those chairs, who pay their salaries, who pay their expenses. These are the folks they thought would be coming in here and representing them and their concerns in this House, not the other way around, as you hear on a daily basis here.

The last member was no different. He, in fact, was taking a message from the Premier and the lines that have been written down by the PAB. What is it? Some 200 of them are out there working right now so that they could write these lines, so that they could spin-doctor their way out and go back and tell those voters who elected them, who pay their salaries, that they're wrong.

The only reason and what they should be worried about is not getting emotional about the issues they are worried about. That's not what democracy is all about. That's not what representation is all about in a true democracy. But that's what you see and hear from those folks on the other side.

The second lesson. The member went on and lectured all of the businesses, the businesses that he believes don't know how to calculate their expenses. There was a lecture for all those business people who are writing him and actually phoning him, and he is lecturing them on how to run their businesses.

I will ask that member or any of the other members from the cabinet or any of the backbenchers out there to come to my neighbourhood. I'll take you to Naida's pizza in a shopping mall where my office is. Go speak to her on how it is going to affect her business.

I'll take you to the ABC restaurant in the same complex, where one of the members from that side used to have his meetings. He will tell this member how his business is going to be affected by this HST. That's what these folks are good at — just simply ignoring what's coming to them from their constituents.

Just tell them how wrong they are. Just tell them how the Premier is right, because it's coming from the Premier's office down through the PAB. They are writing those lines, and they stand up one after the other, and they repeat those lines here.

No wonder somebody here, during question period, called them — what was it? — lambs. Lambs — right? That's the kind of stuff that is happening. One stands up, and the rest of them just follow. They don't need any reasoning on their own.

They were sent here to think on their own, to think based on the information that is brought to them by their constituents and to bring those issues here. But do they do that here? No, they don't. They, in fact, are too busy. Actually, they're tripping over each other trying to please the Premier so that they can get closer and closer to the Premier, and maybe one day they will be in the cabinet. That's what all those backbenchers are doing.

That's not how to succeed in politics, in a real democracy. You stand up for the people who voted you in. You bring those issues here. Then let's have a debate. That's what we need to be doing. But no, the way these folks are doing it…. They are simply listening to their leader, and whatever the leader says goes.

That's what we heard from the member before me. He talks about half-truths. When he looked at the information that is available — whatever information is available out there — he talked with half-truths in there.

[1640]

You want to talk about half-truths? Let's go back to prior to the election. Let's go back to that time. What
[ Page 4830 ]
was a half-truth? There was no truth at all, never mind half-truths. No truth at all in the debate that we had leading up to the election.

When the restaurant industry actually, in writing, asked the Liberal Party, "What are your intentions about bringing in HST," what did they say? They're not contemplating it, because it is not good for the economy. That's what they said at that time. But what happened after the election? Within 72 hours — we just found out now through freedom of information — they were talking to their counterparts in Ottawa. Talk about half-truths.

The same minister talked about: "Why don't we have a debate whether PST is good or HST is good?" He's challenging these members in this House that we should be having a debate on that. But the time to have that debate was, again, before the last election.

Not one of them will stand up. I challenge any one of them to stand up. Let's talk about that particular issue — why this issue was not discussed during the election and, in fact, why it was told to the restaurant industry that they were not contemplating HST because it's not good for you, not good for the consumers. That's what I challenge any one of them: to stand up and explain to the voters why they didn't do that.

That's the kind of debate…. The debate that we need to have here is in the first part when we are talking about this amendment, a reason to go back to the people who are really concerned. Listen to them. Listen to them on why they are concerned.

I had those two very basic reasons why I want to speak in favour of this amendment. One, it will give you an opportunity to explain to the voters why this issue was not discussed before the election. Why, in fact, do the homebuilders, in addition to the restaurant industry…?

The Liberal Party said they're not contemplating bringing in HST. That's what you will be discussing — and listening to those folks who elected you to put you in these chairs. Give them an opportunity so that they can tell you. They can tell you that you're there to represent us, the voters.…

Deputy Speaker: Through the Speaker, Member.

H. Bains: Through the Speaker: it's not the other way around.

That's really the basic, fundamental argument that I think we need to have in a debate, that we need to have before the public out there, and this amendment will allow the Liberals and all these folks here to do that.

You know, I've been in negotiations most of my working life. Many times people are stuck on their positions. A lot of the time they know that they need to move on, but many times they need face-saving. Face-saving — this amendment will do that. It will allow you to save face before the very voters that you misled. This is what they need to hear from the Liberals, from the cabinet and the Premier: why were they misled?

I want to go by some of the timelines, how it happened. This is what happened. On CKNW, The World Today, on August 7, 2009, the Premier was speaking. He said: "After the election, as I mentioned, the Deputy Minister of Finance came and said: 'Look, let's find out what's going on in Ontario and how that is working.' We said: 'Yes, go and have a look.' We had a look and came back and reported to us."

[1645]

Here's another quote, from Barbara Yaffe from the Vancouver Sun. She mentioned the Finance Minister's name. I will not do that.

"If he" — and she used the name of the Finance Minister — "indeed was oblivious to Ontario's actions for more than a month, campaign or no campaign, British Columbians have good reason to question his fitness as Finance Minister."

She goes on:

"It's a minimum responsibility of Finance ministers to be up to the minute on Canadian policies that threaten to impact their own jurisdiction's competitiveness."

That's what all those folks who pay attention to politics are talking about.

Here's another one, Vaughn Palmer, a renowned House reporter here: "Well, if the HST idea is such a humdinger for the future of the economy, why didn't they do it before the election?" Good question. Very good question. That is exactly the question that voters are asking out there today, and this amendment would allow the Liberals to do that and do the explanation, if they have any explanation.

Let's talk about the timing. They talked about Ontario and why they went after Ontario to figure it out. Actually, in January 2009, which is about four or five months before the election here, Ontario Premier Dalton McGuinty said that his government is considering adopting the HST. So this is January 2009. He's already out; he's already talking about bringing it in. By March, two months later, March 26, 2009, in his annual budget, Ontario announces it will adopt HST.

They had a full — what is it? — two months. They had two months. Ontario announced two months before the election that they were bringing in HST. This government says, "Oh well, we just started talking about it after the election, and we said: 'Well, why don't we go?'" But that's not what they said.

We found out later that it was three days. Within three days they were talking to the federal government, but officially what the Liberals are saying is: "Oh well, you know, it was about seven weeks or four weeks or three weeks." Whatever timeline they want to pick, they can pick. "'Well,' we thought, 'let's go find out what's going on in Ontario.'"

They knew two months before the election that they had introduced HST in Ontario in their budget. So much for Ontario and Ontario's influence on this government
[ Page 4831 ]
and on why they brought in HST. This government then announced on June 23. That would be about six or seven weeks right after the election that the HST was announced by the Premier and the Finance Minister — just six weeks after the election.

Madam Speaker, those are serious issues, and that's why we need to go back to the public and let them have their say. Let them have their say to these folks here — the Liberal Premier, the cabinet, all of the rest of the backbenchers. Listen to those folks. This amendment would allow you to do that.

The second good reason why they should be doing this: let them tell you — let the public, the voters tell you — that it is a wrong tax, anyway. It is a wrong tax and at a time, especially, when you are bringing it in…. It is not a good tax, anyway. That, again, will allow you to go back through this amendment, listen to the public so that we can have this dialogue. We can have this dialogue as to why people feel that they are not going to benefit from this tax. That's what they will hear.

But I have my doubts. I have my doubts, even if this amendment passes. I think that some of those Liberal MLAs out there might be thinking, because they are going to go before the same voters in three years' time, anyway…

[1650]

Interjection.

H. Bains: …or less. The member said: "Or less." You know, if the public anger continues the way it is, which I believe it will because the Liberals haven't learned any lesson — they continue on with their intention to implement the HST — I think the anger will grow, never mind talking about lessening the anger.

During a time when the economy is already under pressure…. You look around you. The member before me talked about economists. All economists basically agree on one thing. When the economy is bad, you put more money in people's pockets, in consumers' pockets so that they spend money in their neighbourhoods. That will create jobs, and the economy will start or restart again. It will benefit the economy.

This government is doing quite the opposite. Why do we have all these stimulus packages? In the United States, in Canada, all over the place, they believe that we need to put that money in the local economy or into the pockets of the consumers, who will invest in purchasing certain items or go buy groceries or spend in their communities, and that will create jobs. But this government is taking that money out of their pockets — quite the opposite. How is that going to help the economy?

They can stand up. Each one of them can stand up and continue to read from the box, the message box, but that does not do a thing, not a thing, to convince the voters that this HST will do anything good for them. We're talking about not just chump change. We're talking about a $2 billion tax shift onto the consumers — a $2 billion extra burden on the consumers at a time they can least afford it.

When people are losing their jobs, are worried about their pensions and their children's education, they're taking money out of their pockets — $2 billion. How does that help communities? How does that help revitalize the economy? It doesn't.

Here is a progressive government, people who actually think that what we really need to do as far as the harmonized sales tax…. The Manitoba government went ahead and did do a thorough study. They came back with a report. They came back and said: "Yes, it will generate more revenue for the government." They admit that. They also said that it will benefit certain businesses, but at the same time, they said that all of that would be at the cost of the consumers.

Studies there…. They've done the study. This is exactly what this amendment will do, if they could go back and do a similar type of study so that people will know exactly how it would impact them individually and how small businesses will be impacted. Then you can have a debate over it. Because I can tell you that if you do a thorough, proper study, the recommendation will come back: "Do not implement the HST here."

That's what these folks are afraid of, because they don't want to go back and face the voters. Member after member stands up here and says how good it's going to be for the economy, how good it's going to be for the businesses. But if it's such a great idea, why don't you put it up for referendum?

Put it up for referendum, and let's have a debate out there. You'll have your say, we will have our say, and the consumers and the businesses will have their say. Then we will have a vote on it. But that's too much for these Liberals, who have shown nothing but arrogance towards the voters, because that actually is democracy — which we have seen no sign of, coming from this bunch here, representing or hoping to represent their community.

[1655]

I want to talk about how wide-ranging an effect it will have. I was speaking, at the Vaisakhi parade, to the president of the Greater Vancouver Home Builders Association, Peter Simpson. I asked him: "Have you done any study on a new home of $800,000? How will this HST affect that particular home?" Here's what their study is. They sent me this back. They said they'd go back and do it.

They came back. The easy explanation is $69,500. They said that it's $800,000 times 12 percent HST minus $26,500 for the new-housing rebate. Then they went on to do a little further breakdown. They said that it's $800,000 times 5 percent GST, which is the federal portion of the HST, which is $40,000. No GST on the new-housing rebate is available at this price. So $800,000
[ Page 4832 ]
times 7 percent PST, the provincial portion of HST, is equal to $22,500, so $56,000 minus $26,500 for the new-housing rebate minus $7,000 PST savings on materials.

Many of the members stand up and say that the savings will be passed on to consumers. They have calculated all that in here. The end result is $62,500.

I know somebody's going to stand up and lecture these folks as well. "They don't know what they're doing. They don't know how to run their businesses," as we heard from the previous member.

You talk about….

Interjection.

H. Bains: I'll take lower numbers.

Let's cut that by, say, 75 percent, to $40,000. Everyone isn't carrying around $40,000 in their pocket and saying: "Well, yes, you're charging me HST. Here's my $40,000." They need to go to the bank and finance that. Try financing $40,000 for 25 years.

This is how much they will be paying — a $40,000 extra mortgage on their home for the next 25 years. That's the money they will not have if they want to replace a car, buy a new sofa, buy a new bedroom suite or upgrade their house. That money is no longer available to them. That's how devastating the effect is.

The member before me was talking about $2 here, $1.50 there, $5 there. "Well, what's the big deal?" The member said: "What is the big deal about that?" When you add all that up…. When you've been burdening the consumers and the working people for the last nine years by tax shift after tax shift, this adds up. They don't have any more capacity to pay you anymore.

People want to pay tax, despite what people think. They know that without taxes those services will not be there. All they're looking for is fairness in paying taxes — fairness.

This government is all about moving from progressive taxation over to regressive taxation. Whether you're a CEO or a janitor at the Royal Bank, in their world they both should be paying the same tax. That's exactly the direction they're going.

If you add up all the tax shifts that they have done in the last nine years, it'll be billions of dollars in extra costs — the tuition fee increases, the driver's licence fee increases, the MSP premiums. The list goes on and on and on.

The Greater Vancouver Builders Association can't be wrong. The restaurant industry can't be wrong. The consumers can't be wrong. The tourism industry can't be wrong.

People know how much room they have in their pockets. They don't have any more room. They are hoping to buy those extra things that they wanted to have for their children or for themselves. They don't have that anymore because this government continues to go deeper and deeper into their pockets. That's what I've seen in the last nine years.

Why don't you do what the Manitoba government has done? Do a proper study. Don't bring in these changes at the cost of the consumers. The Manitoba government said no, they will not do that. They said they would help the businesses in different ways — by lowering their taxes. They've done that. There are ways to do that.

[1700]

I've got a number of folks who actually wrote me and e-mailed me and said how they will be hurt by this new tax. Here's the government-owned B.C. Transit plan. I was looking at the government's B.C. Transit service plan. This is what they're saying. With all the different challenges they have, this is what they're worried about: "Changes in taxation legislation and interpretation may have a financial impact."

What's going to happen — higher fares yet again? That's what you're pushing these government entities to. I think it is a really, really good opportunity for this government to save face through this amendment. All they need to do is listen and have what they call sober second thought. Go back and listen to the consumers, listen to the businesses, and listen to all those people who are really worried about this HST legislation. Listen to their concerns and do what the Manitoba government has done.

Let's look at all the pluses and minuses — how the consumers will be affected, how the businesses will be affected, how the government treasury will be affected — and then make a decision at the end of the day. But that, I think, is too much to ask from these folks, because they've already made up their mind. They stand up one after another like a flock of sheep. They will stand up and just repeat exactly what the minister has said.

But show some backbone, Members out there. Show some courage. Stand up for your constituents, stand up for your businesses, and don't be afraid of the Premier, because he'll be gone pretty soon in the next few months or a year. He'll be gone. Don't go with him. Save your future, if you want to, by choosing to stand up against the HST and vote for this amendment.

J. Rustad: It's a pleasure to stand and speak to the amendment on Bill 9, which is intituled the Consumption Tax Rebate and Transition Act.

I've listened to a fair bit of this debate on the bill plus on the amendment. I've listened to many of the arguments that have been brought forward on both sides of the House, and I have to tell you we often joke about NDP math and how the NDP does things. I just wanted to comment in particular on the member for Surrey-Newton, who just spoke. He talked about how there would be $62,000 more on an $800,000 house in costs. Now, 7 percent on $800,000 is $56,000. I don't know how you get to $62,000. But you know what? That's okay. It's their math.
[ Page 4833 ]

You know what else? They also don't understand that there's a more than $26,000 rebate, bringing that cost down. You know what? I understand that they have challenges with math, so that's fine.

So we're talking here about what…. The NDP have brought forward an amendment which is an amendment to basically hoist Bill 9. They have….

Interjection.

Deputy Speaker: Member.

J. Rustad: I hear the member talking about getting those numbers from another source. Maybe they've got a hearing challenge, too, in terms of how they figured out the math, but that's okay.

Bill 9. Their amendment to Bill 9 talks about wanting to postpone this bill. They actually are talking about wanting to send this to a committee. So what does this bill actually do that they want to send to a committee? Well, first of all, it's going to eliminate the PST. They don't want to do that, and I understand their position on that.

[1705]

The second thing is it's going to implement a whole bunch of rebates. That means such things as electricity, home heating and a host of other things that are rebated under HST, they don't want to see happen.

I can understand from a political perspective why they wouldn't want to see this happen because, obviously, HST is being implemented on July 1. The federal government passed the legislation back in November. If we don't eliminate PST, if we don't bring in these rebates, if we don't bring these things in, who's going to take it? And I can tell you who would take it. It would be government because now suddenly, instead of having one tax, it would be two taxes.

I understand for a political reason why they're doing this, but quite frankly, they cannot make a single argument as to why you would want to actually prevent these things from coming forward and why you would want to see it go to a committee.

And that's fine because — you know what, Madam Speaker? — their movement to amend this falls along the same lines as everything else that they've come out and opposed.

When you're talking about wanting to build an economy, in particular when you're talking about wanting to build rural B.C. and northern B.C., what do you need to do? We've got an economic recession that we're just coming out of. Things are starting to pick up, and companies are looking to invest, which will create jobs. They're looking to take advantage of opportunities that they see coming. They need certainty, but they also want to have a competitive tax regime to be able to make those investments in.

What are they opposed to? So far they've been opposed to anything that's called streamlining the environmental process. We're going to still meet the same standards, but they're opposed to that, which means they want to throw delays on those companies having investment. They're opposed to the idea of independent power projects. Apparently they're opposed to Site C and the idea that…. When you're talking about these companies wanting to invest, they need to have power. We need to be able to have that within the province. So they're opposed to those sorts of things as well.

They're opposed to virtually everything we've tried to do on a tax front to encourage investment, including the flow-through mining tax shares. They voted against that in terms of the budget. They voted against many other initiatives that have tried to encourage investment.

So here they are again. Under this amendment, they're trying to oppose the elimination of the 7 percent PST. They're trying to eliminate the rebates. They're trying to actually put more brakes on us trying to do things and drive an economy in northern B.C.

Let me give you some examples in mining. We've got a project that's on the edge of my riding called Mount Milligan. It's a project that has come forward by Terrane Metals, and it's a new copper-gold project. It's going to cost them about $900 million to build this project.

HST will likely save them, and these are still estimates. They're actually working through right now to see what the full cost would be. But an estimate at this stage is that it's going to save them $20 million — one mine, one project. That's $20 million that they don't have to raise from investors. That's $20 million that they don't have to go to the bank for, and that's $20 million reduced off that cost, which lowers their overall operating structure. That's what happens under HST.

But now here's the thing. They want to delay this process and send it to committee. They're ready to start construction July 1. That means they actually want to delay the opportunity for them to start realizing those savings, which ultimately is going to drive over 700 construction jobs and 400 permanent jobs in communities that really need it in northern B.C. That's what they're talking about wanting to do.

Another example, in the forest industry. Apollo Forest Products is right now going through a review, and they're looking at the opportunity to try to expand their mill facilities. They want to put on a smallwood line.

[L. Reid in the chair.]

Now they still have to get to a decision on this and work through this process, but that represents a huge capital investment. And not just that, but they would actually end up processing almost double what they do today.
[ Page 4834 ]

Do you think it's any wonder that they're wondering how HST is going to impact on that investment in terms of what they can drive? If we delay this, does that mean a company like Apollo is going to say: "Well, maybe we should hold off and wait to see what the response is"?

[1710]

This is an opportunity to create jobs. It's an opportunity to drive investment. That's what this is really all about. But once again, you know, the opposition doesn't understand rural B.C. They don't understand how this can benefit and what we need to do to drive investment.

Interjection.

J. Rustad: The member for Nelson-Creston once challenged me and said she'd like to debate what would be good for rural B.C. I hear her right now commenting and heckling, as well, about this. And do you know what? I would love to have that discussion. Let's have it. Stand up, put a motion forward on Monday morning, and let's have it. Because the idea of driving investment…. You have to reduce cost structures, you have to be competitive in terms of regime, and you have to be able to set the environment. That's what HST is doing.

The amendment to postpone this and send it to committee flies in the face of many old things. We talk about this petition, and we talk about the opposition. I can tell you right now, Madam Speaker, that if I went out today and asked people to sign a petition to eliminate the PST, and I went around…. I would think that if I spent a weekend or a couple weekends going around, I could get a thousand signatures from my riding just like that — guaranteed.

People would love to eliminate the PST. It's easy to say. You start talking about bringing in taxes, and it's very easy to say that. You know, there's a common adage that an old tax is a good tax.

There's an article here from April 21, 2010, by Jon Kesselman in the Vancouver Sun. He went on to say — this is about the old PST: "B.C.'s PST is not only an old tax but an antiquated and outmoded tax. The format is used in only five Canadian provinces" — just three, of course, after Ontario and B.C. — "and 45 out of 50 states. Almost every other country has long since abandoned retail sales taxes and adopted a value-added tax format like Canada's GST."

I wonder why they've all done that. I can tell you, Madam Speaker, why they've all done that. They've all done that because it helps to drive investment, and it creates jobs and opportunities. The amendment that's brought forward to simply defer this and put it to committee clearly shows that they do not understand how we need to structure our economy to actually drive investment.

The article I was earlier quoting goes on to say:

"Moreover, no country besides Canada simultaneously employs two such divergent forms of sales tax at the national and subnational levels. Retention of the PST in B.C. would leave the province's businesses with an unnecessary $150 million of tax compliance costs each year, which pushes up the product prices for all consumers. Retaining the PST would also leave the provincial government burdened with an additional annual cost of $30 million for administration plus $50 million for vendor compensation."

We're talking about them wanting to increase the costs of government. Now, I don't know if they want to do it because they want to save some jobs or potential impact on jobs for those that are working for the government on the PST. I'm hopeful that as we transition, they'll find other opportunities to be able to do things. But what exactly is it they're trying to do?

Back to that article again: "These operational costs will be eliminated with the move to an HST, thus helping to preserve public services and/or resist pressures for tax hikes." Now, that's a point that I think is somewhat lost in this discussion.

Every single day you will hear the opposition stand up and say they'd like to see more money spent on health care. They'd like to see more money spent on education. They'd like to see more money spent on services. As a matter of fact, they want to see more money spent on just about everything.

Well, where is that money going to come from? Are they going to take the approach that Nova Scotia has done, the NDP government in Nova Scotia, and raise their sales tax by 2 percent? That would be more than a $2 billion hit on the taxpayers of this province so they could put more money into everything. Is that what they stand for? Certainly, they keep talking about wanting to spend more dollars.

The NDP have a record of raising taxes. That's what they've done in other provinces. We are resisting that. What we are doing is trying to set the tax environment correctly so that we can drive investment, so that investment will create jobs. Through all of that additional economic activity, government revenues will increase, and we'll be able to provide additional services. That's the approach for building an economy, not raising taxes and choking off your economy.

[1715]

Back to this article again, it says that these application costs would be eliminated, as I mentioned before. Once again quoting from the article: "In addition, repealing the HST would deprive the B.C. treasury of $1.6 billion in federal transfers made to facilitate harmonization." So $1.6 billion — that's not a small amount of money; that's huge. Where would that money come from? Where would we find those dollars for a budget? Do you want to borrow that from your children and run a deficit? Are you going to raise taxes? Where would that come from?

Yet not a single one of them has mentioned that, and like this article says: "Opponents of the HST have not told us how they would make up those lost revenues. Raising taxes? And if so, which ones? Cut public spending as opposed to which services?"
[ Page 4835 ]

It's interesting that the amendment comes forward to study HST, to study the impacts, and yet clearly there is no thought whatsoever of the consequences of their actions. That's sad, because when you're sitting down here, when you're working for your constituents, when you're trying to do the best you can to be able to provide your constituents with opportunities for employment, trying to provide the kind of economy that can drive and support rural communities and small communities and help families to be able to support their children, to be able to afford….

You need to have a strong economy. You need to be able to drive that. When you think about policy, you cannot miss key components like the ones I've just mentioned. How would the NDP manage to handle that issue? Where would those dollars come from? You know what? If you want to make a good argument as to doing something, you've got to be able to answer those questions. You can't just stand up here and spout rhetoric. You actually have to be able to put forward solutions, put forward ideas, put forward things that people can understand and say: "That's how you're going to proceed."

I haven't heard any of that from these guys. It's been three weeks now, going on the fourth week of debate on this bill. That's very unfortunate, because it is an opportunity right now for them to be able to stand up, put some policy in place, put some thoughts in place and show the difference. But the fact that there's a lack of that clearly states that those guys are in opposition for a reason.

There was an interesting article that was written just recently by Tom Fletcher with Black Press, and I'll quote from that. I'll skip a little bit of the quote here, but it goes on to say: "…not even 20 years ago. The GST replaced the 14 percent manufacturing sales tax that was imposed on our own business but not on imports. Then we stood around in our dirt-glazed lumberjack shirts, Molson stubbies in hand, and wondered why we were still hewing wood and drawing water for the world."

That was a quote. Those aren't my words. The bottom line is simple. You need to be able to create the right environment to drive those investments, to drive those dollars.

You know, Madam Speaker, over the course of this debate and over the course of this amendment that we're speaking to, I've heard many statements, and I've heard many, many words used by the opposition. For example, the member for Surrey-Whalley…. I actually heard these words. He said: "I support HST." I heard those words. As a matter of fact, I can go back to Hansard, and anybody can go back to Hansard and pull out those exact words and show that. And do you know what? If you went through every other speech, virtually every other speech of the NDP, you could find those same three words in their speeches.

Now, I'm playing a little bit here with the opposition, because clearly they haven't come out and said those words altogether in one sentence, but they have said those three words in their thing. The key there is context, how those words were said. The reason why I'm saying that is, of course, the NDP have taken my words out of context as well, as they have many other things. It's funny how you can play with words, if that's the direction you really want to go, rather than debating the issue, rather than debating what's important.

What is important here is that this amendment will implement additional costs on consumers. It'll actually implement additional costs on businesses.

[1720]

For an uncertain period of time…. If you wanted to go forward and take this to the Finance Committee…. I've sat on the Finance Committee for the last two years, and I can tell you something, Madam Speaker. I have heard hundreds of submissions over the last two years, and I have read thousands of submissions over the last two years in the Finance Committee. And do you know what? There are a couple of common themes in those submissions. One, the PST system is antiquated. It is challenging. It's hard for business. It adds cost. You need to fix this. You need to exempt that. You need to do a whole host of things on PST.

You can go back and look at them. I know that many of the members opposite have been on the Finance Committee, and they've heard those same words.

Do you know what else I heard in the last two years that I was on the Finance Committee? I heard significant presentations saying: "Implement HST. We've got to get rid of PST. Go to HST. It's the right thing to do to build your economy. It's the right thing to do to support jobs. It's the right thing to do to be able to help build your profits." That's what the Finance Committee heard.

Yet they want this bill — which actually is simply to eliminate the PST, which is what people had been asking for, to put in the rebates that need to be put in place — to go back to the Finance Committee and go through a delay in the process. I don't understand the logic. Maybe the next speaker for the NDP will have the opportunity to stand up and actually straighten out that record, what that logic is for not eliminating the PST, not implementing the rebates.

Economic activity can be a very delicate thing. You have only certain windows to be able to drive investment and opportunities. You have to have the right environment where the capital is available. You have to have the right environment where your commodity prices…. The underlying prices for the goods or services that you're going to create and offer have to be in a situation where there's an opportunity, there's demand and there's some market share that you can go into. You have to have the right policies to be able to help drive that investment.
[ Page 4836 ]

We have a window of opportunity. We have a window of opportunity now to do some great things in this province, to be able to build this province like we haven't seen in a generation, to be able to drive investment, to drive opportunities in forestry, in mining, in virtually every single sector. We have that opportunity today, and one of the things we are doing is that we recognize that, and we want to try to capitalize on that opportunity.

Governments don't create an economy. What governments can do is set the stage so that as economic activity happens, you can actually exceed or, in the case of the 1990s, hinder economic activity compared to world activity and compared to activity in the rest of Canada.

We have that window today. We have that opportunity to have confidence and stability, to be able to drive that investment and what that brings. This isn't about companies and investment. This is about jobs. This is about the opportunity to create employment. Delaying Bill 9 — that's what the amendment does — delays that opportunity.

I'll tell you, Madam Speaker, that back in the 1970s we saw a similar window. Just at the critical time, just in that component, we saw an NDP government come into power. The amount of lost opportunity under their policies, under their thoughts and what they did, was unbelievable. We had an opportunity to do something great, and it was tempered because of policy, just like we have today.

Madam Speaker, as you can tell, I'm very much opposed to this whole idea of the amendment. I understand the principles. I understand they want to have public input. I understand that they want to be able to take it out to flesh out issues. But the issue is that we're elected to make decisions, and sometimes you have to make tough decisions.

As I said in my previous speech — which was misquoted — when I ran, I heard three main themes from my constituents. I knocked on doors, town hall meetings, everything that I went to…. The three main themes were clear.

You've got to find ways to support the forest industry. Support means taking tax dollars and using them in a way that's going to help support the industry, to help make it competitive, to drive down costs, to create employment opportunities.

[1725]

You have to find ways to expand the number of jobs, and you have to find ways to be able to diversify the workforce, diversify the economy that you have in those particular areas.

Those are the three main things that people talk to me about. As I said before — which was taken out of context, and I'll say it again — I ran based on doing just that. I ran based on trying to help the forest industry, to help diversify our economy and to help support new job creation. HST does that.

The elimination of PST will help to do that. Bringing in the rebates will help to do that. The amendment, just like every other thing that the NDP have brought forward, is all designed to try to hinder that. It's a shame, because it shows a lack of understanding and a lack of conceptual ideas of how to build your economy and how to support families and communities and jobs.

I just want to close with one last comment. I read an article today, and I can't remember the exact article, so I'm going to have to paraphrase as opposed to quoting this directly. The leader of the anti-HST movement, Bill Vander Zalm, was out and asked about the PST….

Interjection.

J. Rustad: I know that it's the new leader for the NDP, and I'm sorry for offending you by doing that.

In any case, he suggested…. When the question was put to him, "Well, what would you do with the PST?" he said he would rework it and put it as maybe a 4 percent tax across the board. Okay, at least the guy has put up an idea. We haven't heard anything come from the other side of the House. It's no wonder why they're following Bill Vander Zalm as opposed to actually having leadership on their own side with any kinds of ideas.

Having said that, think about what Mr. Vander Zalm has just said. What would that do to gasoline prices, to electricity prices, to home heating? What would that do to restaurants and to everything else? You're talking about taking 4 percent on stuff that currently is not taxed and adding it on.

Anyway, the logic I don't see. Going to 7 percent with rebating all those things, but 4 percent is okay? I don't know. In any case, that's logic that he'll have to explain one day, and that's fine.

To me and to my constituents, moving forward with HST is a challenge. I can tell you right now that I've talked with many seniors. I've talked with many people in my riding, both in groups and individually. There's lots of concern; there's lots of misinformation. I sit down, and I'll explain what it means and how the process goes and what the impact is. For many people, they go: "Okay, I get it. I don't like it, but I get it."

But to go and approve this sort of amendment, bring in that uncertainty, leave those extra taxes in place and actually damage the economy is irresponsible — irresponsible at best. If that is the sign of what the NDP would want to do if they were in government, all I can say is that I am so thankful that they're in opposition, because coming out of this economic downturn, we need strong leadership to build a better B.C.

We need a government that has a vision and that is able to put together policy, put together investment and put together the tax regime that is going to drive those kinds of opportunities, because now is the time to take that advantage. Now is the opportunity to be able to
[ Page 4837 ]
build that northern decade, to be able to build B.C. as a province. Quite frankly, that's why I'm opposed to their amendment and why I'm supporting Bill 9.

M. Mungall: I rise to speak in favour of the amendment to move Bill 9 to be determined or consulted on via the Finance Committee. The reason why I'm in favour of this motion is, of course, that the Finance Committee does excellent work.

I don't know. I had the wonderful opportunity to be a member of the Select Standing Committee on Finance and Government Services this past fall. I find it amazing that the speaker before me, who has also been on the Finance Committee for several years, chooses not to afford the Finance Committee the incredible value that they give to this House.

[1730]

That, of course, is going out and getting public input into the financial decisions that this House makes. Of course, the Ministry of Finance…. The work that that ministry does gets input from the work of the Finance Committee.

It was started in 2000 to collect public input into the prebudget process, and like I said, since that time it has been doing fantastic work, going around the province, talking to people, allowing citizens of our province the opportunity to have their voices heard in the budgetary process. What a great way to really and truly gauge public opinion on the HST.

Is there a better way to do this than having the Finance Committee do its good work — go out throughout the province, talk to citizens and ask them what their perspective is on the HST and truly determine if this is the right course of action for British Columbia? That is what the Finance Committee would bring to this House: ten years of experience travelling around the province, synthesizing and analyzing thousands and thousands of submissions, compiling the data and putting it into recommendations so that we here can make a good decision.

That is what the Finance Committee offers us in this particular instance, and that is precisely why we should be putting this forward to the Finance Committee — so they could do that tremendous work and come back with some good, solid analysis, some good data synthesized into recommendations that are based on public input, one of the greatest things that exists in a democratic system. After all, that is what we have, or so I am told. We have a democratic system.

If we do have a democratic system, there should be no fear from any government to bring its proposal out to the public and hear feedback. There should be no fear. But that is not what we get from the other side. That's not what we get at all. We get tremendous fear, as a matter of fact — fear to go out and talk to people.

Some of the stories that I got to hear in the Finance Committee this fall came from students who are studying in our post-secondary system and what they had to say about tuition and about student aid. Of course, we also heard from arts groups, loud and clear, what they had to say about arts funding. From community to community to community, arts groups came out and had their voices heard.

In Kamloops one person, one citizen who submitted their voice and their perspective to the Finance Committee, talked about a fair tax commission. Let's have something like that in British Columbia, where we could really identify the best way to ensure fair taxation, progressive taxation, and create an equitable society using the taxation system. How do we determine that? There are a lot of questions. "So why not a fair tax commission?" she said.

This year alone 3,500 submissions is what the Finance Committee received. It's an increase from previous years. The reason why? The Finance Committee does excellent work. It looks at how it goes out and talks to people, finds the best way possible to increase participation. That's democracy.

We did that this year on the Finance Committee. We created an opportunity for people to submit on line directly and to also participate via video conferencing, not only because of tight budgets but because of a consciousness for the current situation with climate change and wanting to reduce our greenhouse gas emissions.

The Finance Committee said: "Let's do some video conferencing. We'll stay in one place. We'll reduce the amount of jet fuel we spew into the atmosphere, and we'll connect with people from all over B.C. with a simple tool — video conferencing." We did. We connected with people from Nanaimo, Courtenay, Comox Valley, from the north end of Vancouver Island to the Kootenays, from Cranbrook to Nelson to Creston. We connected with people north in the province, around Dawson Creek area, because of video conferencing.

[1735]

The Finance Committee has the tools. It has the expertise to go out and really hear from British Columbians about what they think regarding the HST, how it's going to be impacting them. Then they will be able to take that information, synthesize it and deliver it to this House with clear recommendations coming from the public. Wouldn't that be a beautiful thing in this democracy?

Like I said, the Finance Committee received 3,500 submissions this year, and many were opposed to the HST. Some were for it, and we've heard members opposite talk about those people who are for it. So I decided I'm going to do a little sampling. I'm going to do a little study. I'm going to put all those years of post-secondary education to use here and see how many people were in favour of the HST and how many people were opposed, of those who wrote in to the Finance Committee about the HST or spoke about it in their in-person presentations.
[ Page 4838 ]

I did a sampling of 10 percent of all the submissions. And what did I find? One out of seven was in favour of the HST. Seven were opposed to the HST. That's about a 70 percent ratio. That's even less than what we find in the general public. In the general public what we see is 82 percent, poll after poll after poll; 82 percent of the population says they are opposed to the HST.

You would think that with all this tremendous feedback coming from the public since July 23, when it was first announced that this government was going to move forward with an HST after not consulting with anybody except, of course, the federal Minister of Finance at a water cooler or coffee maker or whatever the heck it was…. Not consulting with the people who matter, the citizens in this province….

They were loud and clear. They have been speaking out. They have been demonstrating in every possible way how they are opposed to the HST and hoping, praying, pleading that members of the government will actually listen to them, will actually stop and listen.

Hon. Speaker, you would think that when 82 percent of the population is opposed to something, it would light a fire under the pants of any government. It would light them up to say: "Whoa, we've got to stop. We've got to slow down. We've got to slow down and figure what the heck we're doing here." Some 82 percent of the population opposed to something, vehemently opposed to it. Has this government stopped and slowed down and said: "Whoa, maybe we need to go and hear from the public"? No, they haven't done that at all. They have just steamrolled ahead.

But there's no shame in saying that we're going to put on the brakes. I'd like to convey that to the members opposite. There's no shame in putting on the brakes. No one is going to chastise you for that, not at all. In fact, British Columbians would likely say: "Thank you very much for finally, finally listening to us."

There is no shame, but they still don't do it. They still don't do it. They don't show leadership. They don't show a new direction after 82 percent of the population opposes this. They don't do something as simple as moving this on to the Finance Committee to really gauge that public opinion. That's not their aim. Their aim is to steamroll ahead.

[1740]

There's no fire lit under the pants of members opposite. The only fires being lit in their pants are those likely resulting from some serious anxiety-driven stomach aches. Yoga is one way to get rid of those stomach aches. I don't know. I come from a beautiful area, where there are probably more yoga studios than there are people.

Meditation. In fact, I invite any members opposite to come over to my constituency on the beautiful east shore of Kootenay Lake, to the ashram, and you can take a whole meditative retreat for a day. It's in silence, which would be hard, I know, for any politician, including members opposite.

But it would be great. It would give them the opportunity to really contemplate what they are doing here by steamrolling ahead with something that British Columbians are so cataclysmically opposed to. They could do that. They could do yoga. They could do a meditation retreat at the beautiful ashram on the east shore of Kootenay Lake. I'm not plugging that place at all right now. They could exercise, start riding their bikes every day to the Legislature. I recommend it. It's fantastic. They could start eating right. These are all things that they can do to get rid of that anxiety-driven stomach ache that's lighting a fire in their pants.

Another thing that members opposite could do to deal with those stomach aches, of course, is go talk to people. Go out and see what the citizens of this province have to say — the fine citizens whose opinions are valid, whose opinions are valuable, whose opinions we need to take into consideration in all that we do. It is not our job to be condescending, to be patronizing, to talk to people as though they're just emotional, which is a word I hear used often by members opposite to describe the 82 percent of the public who are opposed to the HST. It's not our job.

Our job is to go out and talk to people, to hear what they have to say, because that is a democracy — to go out and listen to what people have to say. I'll say it once more because I feel it's a message worth repeating that members opposite really do need to hear over and over and over again. In a democracy we go out and talk to people. We go out and listen to people. We go out and hear what they have to say. We do not chastise them for having an opinion. That is what we should be doing.

I hear my colleagues pointing out that that's a noble idea, a novel idea. Really, it's actually an 800-year-old idea — nothing new at all. But it seems to be new to the members opposite.

An ounce of prevention is worth a pound of cure. The pound of cure would be now going out and talking to people via the Finance Committee. But the ounce of prevention — and I think you probably know where I'm going with this — for those anxiety-driven stomach aches causing fires in their pants would have been to go and talk to people in the first place. Pretty simple. Pretty simple concept — go and talk to people in the first place.

They would not be chugging Pepto-Bismol the way they are doing right now if they had gone out and talked to people in the very first place. That's what they should have done before July 23 at 9:30 in the morning, when they announced that they were going to be instituting the HST. That's what they should have done — talked to people first.

Talking to people first is not a foreign concept to the Finance Committee. It's not even a foreign concept to
[ Page 4839 ]
this government, because we do it all the time, with the Finance Committee going out and talking to people first, before we make budgetary decisions, to get the public's input.

To say that it maybe didn't occur to them…. Well, that's just misleading. Of course it has occurred to them, but their priority was that conversation that the B.C. Minister of Finance had with the federal Minister of Finance near a water cooler, rather than hearing from the people of this province.

But you know what? At that water cooler the Finance Minister could have said a whole lot of things, and one of the things he could have said was: "I'm sorry, federal Finance Minister" — I say that because I don't know if I'm allowed to say his name in the House — "we can't commit to the HST right now. We're going to have to go out to the public and do a proper consultative process on this major tax decision, a $1.9 billion tax shift. We're going to have to go out on this major tax decision, and we're going to have to actually talk to people."

[1745]

That's what the Minister of Finance could have told the federal government. They could have said: "We're interested in the idea." In fact, previous Finance Committees have told us: "Go out and explore it. Just explore it." It doesn't mean we're committed to it. It doesn't even mean we're for it. It means that we should do our due diligence and explore it. They could have said, "We're going to our due diligence, and we're going to explore it. We're going to do some research. We need to talk to the people first," and at the very least, do it all to inform the decision that needs to be made here in B.C.

That's a long list of shoulda, coulda, woulda, but it's not the list of what did happen. But it did happen in Manitoba. The government of Manitoba did exactly that. They said: "Thanks very much, federal Minister of Finance. Thank you for the idea, but we owe it to our citizens of this province to go and do some research before we commit to shifting taxes, before we commit to a harmonized sales tax. We've got to go talk to people, and we've got to go and do our research to see if this is right for Manitoba."

So they did. They did go out and do their research. They did it before they made any commitment. This is good decision-making process here — going out, getting your facts straight and then making a decision. I did it all the time when I was a city councillor in Nelson.

This is what Manitoba found in all the research that they did. "An HST in Manitoba. Consumers would pay $405 million more in provincial sales tax." Consumers would pay $405 million more. That's what they found. They found that it was the wrong tax at the wrong time, simply put.

It was not the right tax for Manitoba at this time, so they said: "Thanks very much, federal government. Nice chatting with you over by this water cooler. We've now done our due diligence. We've gone out and done the research. We're not going to do this. It's not the right time. Maybe later, but for now we've done what we're supposed to do, made a good decision, and we're moving on."

That's what could have happened here, but I go back to that shoulda, coulda, woulda and didn't.

I already mentioned the copious amounts of Pepto-Bismol that the members opposite must be ingesting these days, and Pepto-Bismol is thanking them. They needed that little extra boost, I'm sure, in their bottom line. If they had gone out and done all that work that Manitoba did, Pepto-Bismol would be writing a letter and saying, "Gee, can't you put in something that's going to increase your stress so that you can buy more Pepto-Bismol?" and the members opposite would be able to say no.

Instead, that's not the letter that they're getting from the Pepto-Bismol company or from Maalox or Gaviscon or whatever preferential antacid they have across the way. Rolaids maybe — whatever their preference is. They're getting letters from all those pharmaceutical companies saying: "Thank you so much for putting in the HST, because our bottom line is just going up with your stress levels."

Had they done all the research that they should have done, like Manitoba, had they actually gone out and talked to people before they did this and maybe put this right onto the Finance Committee's lap before they committed to anything on July 23 at 9:30 in the morning, they wouldn't be getting those letters from Pepto-Bismol, Rolaids and all those other pharmaceutical companies.

Instead, they've ignored the public input, and now they're probably at a point of not just getting letters from Pepto-Bismol and so on; they're probably looking for those higher-end prescription antacids like Nexium and Pantoloc.

Well, good luck, guys. At $3 a pop minus…. It's $3 a pill for Nexium, but it would be $9 if they didn't have health benefits, like so many other people in this province. So Nexium says thank you to the Liberal caucus members for going forward with the HST and causing their bottom line to go up.

[1750]

The public is so dang angry because they were blindsided July 23. They were so dang angry, and who wouldn't be? Who wouldn't be that angry? To come out of an election not hearing one word about the HST, except what was put in writing, which said, "No, we're not going to be looking at the HST…." So it didn't become an election issue. Nobody was talking about it.

I've heard the member for Vernon-Monashee say to his constituents: "I didn't mislead the public. I never spoke about the HST." Well, that is misleading the public — to not even talk about it then to do it so close after the election. For him, that wasn't being completely up-
[ Page 4840 ]
front. For the entire Liberal caucus, the fact that they had it in writing that they weren't going to do it and they are doing it now is clearly not being upfront, so no wonder the public feels blindsided. No wonder they feel so incredibly angry.

The Liberals say that they are merely misinformed, that the public just doesn't have its facts straight. Well, I've alluded several times to the condescending attitude and the patronizing statements that come from members opposite, but I've really got to ask them. I really would like to know: how on earth would they know that members of the public are misinformed since they won't even go out and talk to them? How on earth could they come to a conclusion about four million people and their level of knowledge and understanding about the HST if they won't even go out and talk to them about it?

That's what this motion is all about. Let's go find out if the public's truly misinformed. I've talked to a lot of people, and I'll tell you that no one's misinformed about this one. But I'll give them a little leeway. They haven't gone out and talked to anybody yet, so they don't really realize the extent to which people are extremely informed about the HST.

Let's just send the Finance Committee out to do its good work and have them go out and talk to people and make sure that we really know in this House the extent to which people understand the HST, because I know they understand it crystal-clearly. It's a tax shift of $1.9 billion going from the big corporations onto their backs. They don't see that as fair, especially after eight long years of that kind of prescription for taxation in this province.

People feel like they're paying more and getting less, and their feelings are accurate. They are valid. They deserve to be heard by everyone in this House — not just members from the opposition but everyone. So the question is: is the government willing to actually listen to what people have to say in British Columbia when it comes to the HST? Is the government going to do its job in a democracy and go out and hear from the public? Is that what they're going to do? Well, they will if they have the courage to vote in favour of this amendment.

If they're not quite there yet, let me share with them some of the things that people are saying about the HST.

One gentleman from my constituency. His name is Am Naqvi, and he is a certified general accountant. He also says that he's a card-carrying Liberal member. You know what? He used to be in favour of the HST. He used to actually advocate for it, but the HST that this government is proposing right now and how that compares to what he used to be advocating for are two entirely different things.

[1755]

He says, referring to the HST, "This document that's coming out, this proposal — this is not that at all," the thing that he used to be advocating for. He says: "It's giving away everything, and we're going to pay more money."

Where did he say that? He said that when he marched down to go see former Premier Bill Vander Zalm speak in my community of Nelson. I didn't send him there. I didn't ask him to go there. He's a card-carrying member of the Liberal Party, and that's how he feels about the HST. He feels betrayed. He feels that he's been blindsided, and he wants to have nothing to do with it.

I have another example of the extent to which members opposite need to go out and hear people. It is words that were said in this House on April 12 by the member for Abbotsford-Mission when he was talking about realtors.

[Mr. Speaker in the chair.]

It's hard to know where exactly to start with his long comment, and noting the hour…. Basically, he says that realtors will just absorb the cost of the HST. They'll take less commission. It will be no problem. Realtors will have absolutely no concern with this.

I've never seen someone so desperately in need of speaking to the public, because I just met this afternoon with realtors from my part of British Columbia, and that's not what they had to say at all. What they talked about wasn't their own commissions. In fact, they were much more benevolent than that, because they were talking about the very people that they work for — their clients.

They talked about affordability and how the HST reduces affordability of housing in a market that is already quite unattainable for many, many people. That's what they said to the Finance Committee when they presented to us in the fall.

It's a shame that the member for Abbotsford-Mission had this to say, but it shows the desperate need for this Liberal government to go out and seek public input and to make sure they get to hear what British Columbians have to say.

That's what we do in a democracy. We go out and listen. That's what we do if we're going to be governing with integrity and honesty. We go out and hear what citizens have to say. We don't turn around and tell them that they are just misinformed because they have an opinion that disagrees with ours. We work with them. We listen.

That's what British Columbians want to see. They would welcome the opportunity to present their voice, their opinion, their concerns to the Select Standing Committee on Finance and Government Services and to truly feel heard on what is a major tax shift in tax policy for this province.

As a member of the Finance Committee, I tell you that I look forward to every opportunity to go out and hear from each British Columbian. If we had the time, it'd be
[ Page 4841 ]
awesome to do that. If we had the ability to speak to all four million, God, that'd be amazing.

But even if we could get 3,500 submissions, that's the best that we've ever had so far. To be able to get that number on this issue would be a clear indication of what British Columbians want with this, and we owe it to them. Members of this House owe it to British Columbians to hear what they have to say about this major tax policy, the HST.

With that, I resume my place in this debate, and I encourage all members opposite to hear very clearly.

Hon. G. Abbott: It is a pleasure for me to rise and rejoin the debate on the harmonized sales tax, the elimination of the provincial sales tax, and to speak to what is currently before the Legislature, which is a motion by the opposition that this bill be referred to the Legislature's Finance Committee for consideration. I will be opposing that.

[1800]

I want to take my time over the next little while here to talk about why I would be opposed to that reference to the Finance Committee.

This is an issue, actually, which the Finance Committee has talked about before. This is an issue which has been brought before it on a number of occasions. It's tempting to think, perhaps, that reference to the Finance Committee might actually lead the opposition to become proponents of a harmonized sales tax. I suppose that's at least theoretically possible, and therefore, the amendment becomes interesting for that reason.

Nevertheless, on the balance of things, I would oppose that — and I'll want to talk about why — because I think it is important for us to move forward with respect to harmonization for reasons which I'll articulate in the next little while.

I know that at the Finance Committee back on September 25, 2006…. This was something the Finance Minister mentioned today in response to a question from the member for Juan de Fuca, reminding the member that back on September 25, 2006, the member had this to say: "I want to go to the GST-PST harmonization, because a couple of witnesses earlier in the day were talking about that. I thought we had kind of spiked that here some time ago. I know my spouse is a small business person, and she has to deal with both sets of bureaucrats. That's the motivation for her for harmonization." That's from the NDP MLA for Juan de Fuca.

The member's spouse certainly was intuitive. I'm sure she must be of a most patient and understanding character as well. But there's no doubt about that, I guess, given the circumstance around her life. I'm sure she is intuitive, as well, because in fact, if the GST and PST are harmonized, small business people, like the member for Juan de Fuca's spouse, can look forward to a reduction in compliance costs of collectively about $150 million. That's hugely important in terms of productivity, in terms of competitiveness for all business, including small business in British Columbia.

It will also be a positive for British Columbia's taxpayers, as the harmonization of federal and provincial sales taxes will see about a $30 million reduction per year in the costs that government and, through government, the taxpayers face for these issues.

I should begin with this question, because this is really the question which is at the heart of the NDP's motion to refer to the Finance Committee, and that is: why not wait? Why not wait? Why not wait perhaps several months or a year, two years, three years? Let Ontario proceed on July 1 of 2010 to harmonization of their provincial sales tax, a retail sales tax with the federal goods and services tax, but have British Columbia hold back. What can be the harm in that?

Well, there's much harm in that, and I think I'm in good company in concluding that. I don't think I have yet heard from the opposition side of the House a cogent argument — or any argument, in fact — relayed from any kind of economist in Canada to suggest that the HST is a bad thing. I haven't heard that at all.

I've heard lots of rhetoric about how unpopular it is. That, I think, can be readily acknowledged. But is harmonization a poor idea from an economic perspective? No. There are very powerful arguments for it. To have Ontario move forward with harmonization on July 1 and to have us lag behind by at least one year and perhaps two or three years, I think, would be a very, very poor choice and an irresponsible choice on the part of this government and on the part of this House to do that. So I do not support the amendment for that reason.

[1805]

The harmonized sales tax ensures that British Columbia's products will remain competitive nationally. If we see Ontario move ahead with a harmonized sales tax and British Columbia does not, British Columbia's small manufacturers, British Columbia's businesses and industry will face a 7 percent barrier to competitiveness with Ontario and those several other jurisdictions in Canada that have also moved away from retail sales taxes and to the value-added tax or to the harmonized tax that is being proposed.

It's very important that there would be a 7 percent penalty against our small businesses, our medium-sized businesses, our large businesses, our industry, our manufacturers. All would have that 7 percent penalty, and I think that would be most unfortunate.

It will also make British Columbia's products more competitive internationally, and that's important. Many of us have the forest industry as one of the backbone industries in our constituency. I certainly do. That industry has been deeply troubled now for about three years, and we need to find every way we possibly can to ensure that our forest industry and all of our other
[ Page 4842 ]
industries have an opportunity to compete internationally. Again, that's 7 percent, and that 7 percent, which often cascades through the product lines, is something that is very destructive of our ability to be competitive internationally.

Of course — and I've noted this before in previous commentary in the Legislature here — some 130 jurisdictions across Canada and across the world have now adopted harmonized sales taxes or value-added taxes. For that reason, if we want to be productive, if we want to be competitive, it is very, very important that we have the economic advantages that will come with the harmonized sales taxes.

One of the things that has disappointed me in the debate to this point from some of the members opposite is this almost constant reference in some cases to capitalism and the big corporations and so on, as if somehow the political agenda and the political vocabulary hadn't advanced since the 1960s.

It is remarkable to hear some of the rhetoric. I do wonder about just how ready some of the members opposite are for government when I hear rhetoric like that, which I think clearly missed the entire Tony Blair era in Britain, where the social democrats managed to reconcile themselves to things like big corporations, refraining from phrases like "Eat the rich" or "Eat the capitalists," "Hang the capitalists" — those kinds of things.

Many, many social democrats during that Tony Blair period were able to move beyond that, but apparently, we're frozen in time, at least among some members in the opposition ranks in the Legislature with respect to that rhetoric.

If members opposite don't care about the big corporations, if they don't care about the capitalists, they should care about the jobs that are produced by those corporations and the investment that is so important to creating and maintaining those millions of jobs in British Columbia, and the taxes which are generated for government coffers, whether at the municipal level or the provincial level or the federal level, that maintain all of those services that have become central to the quality of our lives.

[1810]

Those jobs, that investment, the tax revenues provide us with the wonderful health care system we have, the wonderful education system we have, the social services which I think are ones that we can be very proud of.

When I was speaking last time in here, I did speak of some of the excellent publications which have been undertaken in British Columbia and Canada with respect to harmonized sales taxes. One recent addition to that collection was an article in the Vancouver Sun, which was also a longer piece that was composed for a journal, the Policy Perspectives publication, by Dr. Jon Kesselman. This is an article entitled "HST Critics Need to Take a Closer Look at Crumbling PST."

So who is Jon Kesselman? Was he someone that just randomly wandered down the street and expressed his view or sent an angry letter to the Vancouver Sun? No, Dr. Kesselman holds the Canada Research Chair in Public Finance with the graduate public policy program at Simon Fraser University. Dr. Kesselman has many, many fine works to his credit, and he is much esteemed as one would expect, given that he holds the Canada Research Chair in Public Finance.

Dr. Kesselman had a number of things to say which I think are very important in terms of understanding the HST and the need for the HST. I'll quote just briefly from the article. This is a very recent article, April 21, 2010, in the Vancouver Sun. I would encourage listeners or viewers to take the opportunity, if they haven't seen Dr. Kesselman's article, to have a look at it or have a look at Policy Perspectives, volume 17, No. 2, April 2010.

I'll quote just briefly. I know we have some other business we need to deal with in the House, so I'll try to wrap up in a few minutes. But I just quote briefly from Dr. Kesselman. "After all their publicly bandied criticism of the HST, much of it misinformed and misconceived, opponents of this tax reform need to justify retention of the PST. It's time for the public spotlight to be turned from the HST to the PST. In fact, B.C.'s PST is seriously flawed and economically damaging, and whatever its potential shortcomings, the HST will be superior in almost every respect."

This is the Canada Research Chair in Public Finance in the graduate public policy program at Simon Fraser University. The member opposite is indicating how impressed he is by that, and that's good. One can never be converted too late in life, so I'm pleased to hear that.

He's saying that life as we know it is not going to come to an end on July 2, 2010, or July 1, 2010, for that matter. In fact, we can fully expect that the HST will be superior.

So why? Among the very important points that Dr. Kesselman makes…. I'll just try to go to what I think is a very important point. I'll just quote this: "Non-partisan panels of economic experts have identified provincial retail sales taxes as one of the most damaging public policies in terms of productivity growth. In this context, harmonization's estimated one-time impact on the consumer price level of 0.7 of 1 percent will be a bargain in return for many years of increased growth in jobs and real wages."

This is actually consistent with other work that has been done on harmonized sales taxes. In particular, there's been some excellent economic analysis undertaken of the move by maritime provinces in the late 1990s to the….

Interjection.

[1815]

Hon. G. Abbott: The member says that no one cares. That's interesting that the member says no one cares. So the member is saying that we should just ignore the experience of the Maritimes. We should ignore the advice that comes from esteemed economists in Canada? We should always try to hatch public policy in the realm of ignorance? That's, again, an interesting observation being made.

The work that was done with respect to the economic analysis in the Maritimes suggests that, in fact, again the net cost is less than 1 percent. The reason for that is there is a conversion of retail sales taxes as bottom-line costs against the business product conversion to input tax credits.

It works to expand economies. It works to expand jobs. It works to expand investment. It works to expand tax revenues, and it works to expand the range and quality of services which we can provide in British Columbia and in Canada. So this is all enormously important, but I appreciate that there is also some important other business to be discussed here, so I'll move adjournment of debate.

Hon. G. Abbott moved adjournment of debate.

Motion approved.

Standing Order 81.1

SCHEDULE FOR DEBATE ON BILL 9

Hon. M. de Jong: I rise pursuant to Standing Order 81.1 to advise the House that, despite much debate thus far, regrettably, the government and opposition have been unable to reach an agreement pursuant to the provisions of section 1 of Standing Order 81.1 in relation to Bill 9 that is presently before the House and has been for the month of April.

Accordingly, I move the following:

[Pursuant to Standing Order 81.1 (2), all proceedings relating to the second reading of Bill (No. 9) intituled Consumption Tax Rebate and Transition Act shall be completed and disposed of on or before April 27th, 2010 at 6 p.m. At 5:45 p.m. on the date mentioned, the Speaker shall forthwith put all necessary questions for the completion of second reading stage of the said bill without amendment or debate. Any divisions called on the second reading of such bill may be taken in accordance with Standing Order 16 and all other divisions will be covered by Practice Recommendation No. 1. Proceedings under this motion shall not be subject to the provisions of Standing Order 81 or the Standing or Sessional Orders relating to times and days of the sittings of the House.

I further move that pursuant to Standing Order 81.1 (2), on or before 6 p.m., Thursday, April 29th, all remaining stages of Bill (No. 9) shall be completed and disposed of. At 5:00 p.m. on the date mentioned, the Speaker and the Chair of the Committee of the Whole will forthwith put all necessary questions for the disposal of all remaining stages of the said bill without amendment or debate and divisions called on sections of Bill (No. 9) shall be taken in accordance with Practice Recommendation No. 1. Any divisions called on the third reading of such bill may be taken in accordance with Standing Order 16 and all other divisions will be covered by Practice Recommendation No. 1. Proceedings under this motion shall not be subject to the provisions of Standing Order 81, or the Standing or Sessional Orders relating to times and days of the sittings of the House.]

[1820-1825]

Motion approved on the following division:

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

Hon. M. de Jong moved adjournment of the House.

Motion approved.

Mr. Speaker: This House stands adjourned until 10 a.m. tomorrow morning.

The House adjourned at 6:28 p.m.
[ Page 4844 ]

PROCEEDINGS IN THE
DOUGLAS FIR ROOM

Committee of Supply

ESTIMATES: MINISTRY OF FORESTS
AND RANGE

(continued)

The House in Committee of Supply (Section A); H. Bloy in the chair.

The committee met at 2:35 p.m.

On Vote 34: ministry operations, $380,357,000 (continued).

The Chair: Good afternoon, everybody, and welcome to the Douglas Fir Room. We're doing the budget estimates on the Ministry of Forests and Range.

N. Macdonald: Just a couple of questions on how to proceed here, and we can do it a couple of ways. Now, I understand that on the questions that came related to the harbour issue, there's going to be a separate briefing, and that will be provided.

The other outstanding issue that we have from the questions on Thursday was around the Farnham Glacier, and I don't know if you have any more information on that. Maybe I'll just turn it over. I gave you a series of questions. I think that you probably have the answers, and we can go from there.

Hon. P. Bell: We have followed up on that specific tenure. It was issued by the Ministry of Tourism, Culture and the Arts. I know that their estimates have already come and gone, so I'd just recommend that the member ask for a briefing from the ministry, and I'm sure they can provide the level of information he's looking for. I've already made the Minister of Tourism, Culture and the Arts aware of the issue.

N. Macdonald: Just to understand, then. I mean, perhaps I just don't completely understand how the integrated land management bureau works, but my understanding was that this was an organization that took all of these issues and dealt with them on behalf of the various tenure holders. So for instance, ILMB would be responsible for heli-skiing tenures, for the whole host of overlapping tenures — certainly when you go back and you read the explanation.

So is that a misunderstanding? The tenures are actually held by individual ministries, and ILMB has no role in the provision of these tenures. Is that the case?

Hon. P. Bell: The member quite accurately describes the role of the integrated land management bureau in terms of how it issues tenures and manages tenures. The member will recall that I often talk about small and medium-sized businesses. Generally speaking, resorts fall outside that category in terms of size. It's a larger business. Tenures that are in any way associated with those forms of relationships in resorts are managed by Tourism, Culture and the Arts, while local ski hills — you know, small ski hills, something of that nature — would be managed by the integrated land management bureau.

So that's where the point of difference is, and there are delegated authorities that come back and forth between different ministries. I think the member has described it correctly. The vast majority of tenures, certainly for small and medium-sized businesses, are managed within the integrated land management bureau. The larger ones, and this would be one of those, would fall to the ministry — in this particular situation, to the Ministry of Tourism, Culture and the Arts.

N. Macdonald: Just so I understand…. I mean, we aren't not talking about the Jumbo Glacier resort. We're not talking about the possibilities that exist around the government implementing whatever it is they choose to do there. What we're talking about is a fairly specific tenure that is not related to that, although the connection for most people is that it would be a proponent that, presumably, is the same as the proponent for the development.

But the area is actually a fairly straightforward expansion of an area that…. We had the Calgary Olympic Development Association. So it seems not directly connected. It seems, in 2007, a fairly straightforward application for a licence of occupation. It seems to fit with ILMB. I don't see how the minister distinguishes this from any other licence of occupation that we'd be talking about. It clearly is not something that the Ministry of Tourism would have responsibility for.

This is not the creation of a resort municipality, which would be their responsibility. This is just tenure, and it's for things like sightseeing. I mean, if you have in front of you the actual licence of occupation, it's for alpine skiing, some sightseeing and things like that — so a fairly straightforward application. It would be interesting to get more information.

[1440]

Like I say, there are all sorts of questions that people have about why there wasn't notification. All of these seem to be technical and attached to what ILMB does. That's where the expertise is supposed to sit. So if we could have some of those questions answered, I think that people in the area would appreciate it.

Hon. P. Bell: The member is getting a bit beyond my ability at this point to answer at that level of detail of
[ Page 4845 ]
question. I did pursue the tenure number that was provided to us on Thursday, but we discovered that it had, in fact, been issued by the Ministry of Tourism, Culture and the Arts, so we really didn't pursue it much beyond that point. It would be that ministry that would have the ability to respond. I'm not trying to be evasive in any way. I'm sure that the questions that the member opposite has, the Minister of Tourism, Culture and the Arts would be able to answer.

I was hopeful that their estimates hadn't occurred yet. Upon investigation of that, I discovered that Ministry of Tourism, Culture and the Arts actually has transpired. I think that the next best solution to respond to the questions that the member has would be to deal directly with the ministry. I'm not trying to be evasive; I just don't have any further information than what I've provided.

We could pursue that if the member wants me to, but again, I'd be answering on behalf of another minister. It is a delegated authority, and I am told that there's an integration with Jumbo Glacier resort, but that's all I really know at this point. I don't have any other information.

N. Macdonald: Okay. Just in the interest of time…. We are very limited in time, and there'd be really no point in me asking the same question. If the minister doesn't have the information, he doesn't. So what we'll do is…. I'll pursue it with the minister.

Like I say, I'm still a little confused why integrated land management wouldn't be in charge of this process. It seems that you would be, but perhaps…. Looking at the contract, it says "the minister responsible for the Land Act." I guess that the question to the minister, just very quickly…. The minister responsible for the Land Act, I would presume, is the minister of the ministry that you formerly held. Is that the case?

So it's the Ministry of Agriculture and Lands. Okay.

Let's move, then, to the reductions that are happening and the reorganization of the Ministry of Forests. I think that for many people in the ministry — and I'm sure for the minister and your senior staff — it's a very difficult process. We want to go through and understand what has taken place there.

I guess the first thing that would be of interest is just having the minister explain the role that he played in the decision to take approximately $320 million out of natural resource ministries. Just explain that process, maybe, to the public as to: is the participation in Treasury Board? What role, specifically, did the minister play in that decision?

Hon. P. Bell: Just to backtrack very briefly. The member did point out quite correctly that the minister responsible for the Land Act is the Minister of Agriculture and Lands. I have been provided with delegated authority from the Minister of Agriculture and Lands, as minister responsible for the Land Act, to perform the business that I do through the integrated land management bureau. The Minister of Tourism, Culture and the Arts has received some limited delegated authority as well. So that's how that all functions.

The member asked — to paraphrase, and this may not be a perfect paraphrase: "How did the government kind of come to the conclusion around budgets and the changes that were made to budgets?" There is a process in which ministries present their needs on a needs basis to Treasury Board staff. Staff review the information, consolidate it, bring it forward to Treasury Board, and then, of course, government makes the end, global decision, and the Minister of Finance ultimately makes those decisions.

[1445]

Every minister would present, through their staff, the details of what their needs were on a needs basis, and then decisions are made globally in the context of what moneys are available and where government priorities lie.

N. Macdonald: So the minister is saying that the cuts are a reflection of government priorities? Is that what the minister is saying?

Hon. P. Bell: Changes to any budgets in any direction are a reflection of the needs. As I pointed out in my remarks, each minister provides a detailed list, through their staff, of what the needs are in order to be able to deliver the services that are asked of them. Then government, on a cross-ministry basis through Treasury Board, looks at all of the requests and makes decisions on that basis — on a priority basis.

N. Macdonald: Now, why is Forestry bearing the brunt of two-thirds of these cuts?

Hon. P. Bell: As we looked at our priorities and at what we needed to accomplish, we did identify a number of areas where there were opportunities. Clearly, the harvest levels are off significantly — I know that the member opposite knows that — from a historic level of about 70 million cubic metres down to about 41 million cubic metres. The initial projections were for lower harvest levels going forward — under 50 million cubic metres for the next several years. Certainly we believed that we'd be able to deliver the services necessary within the budget that we've been allocated.

N. Macdonald: Just to understand: is this a sum that the minister conceded? Is this what the minister was in there arguing for, or is that not the case? The minister said that there's a rationale, but is it a rationale that the minister accepts and concedes as a reasonable direction for government?
[ Page 4846 ]

Hon. P. Bell: The budgetary process is an iterative process where, at a staff level and at a minister's level, we go back and forth in discussions to determine if each ministry can meet the expectations of that ministry. The budget that we were allocated in the end is one that we're comfortable with, that we're confident we can deliver the services with.

It's not a case of anyone conceding anything. It's about establishing cross-government priorities, doing it in a way that manages the corporate finances across government to meet the obligations that are expected of us and to do it in a prudent way so that we don't end up with a deficit that people are uncomfortable with.

A very difficult budget year this year. I did sit on Treasury Board for about five years or so, I think. I'm not on it anymore at this point, thank goodness, because it allows me to focus my attention on forestry, where we need to. But it is always challenging, and I know it is not something that folks on Treasury Board had a fun time with this year either. It was very difficult.

N. Macdonald: Just to understand the rationale that the minister has given for the cuts…. I presume that this is larger than his rationale. It's the rationale that the government is putting forward. The only explanation I've heard is that it's solely related to harvesting levels. Is that the government's central rationale for the cuts in the Ministry of Forests?

Hon. P. Bell: I wouldn't say that it is only a case of the way that the harvest levels…. That is certainly a component of it, but we also believe that we need to take the ministry in a new direction. The organizational structure that I think the member is aware of and the shift in the way that we're doing business also are parts of the equation here in terms of how we're reorganizing the ministry and how the budget looks different at this point.

N. Macdonald: Presumably, I think, most in the public would hope that a reorganization would be, you know, based upon some central idea.

[1450]

But I think that most in the public perceive this as: the funding is cut, and then there's a reactive process where, very quickly and without necessarily being tied to any central theme here, there is removal of positions. I think the public is in that place.

Now, the central rationale that the public has heard is that harvest levels are down, but presumably, when you have an institution like the Forest Service, you'd be thinking in the long term. Is it the minister's view…?

I've heard different things, because sometimes the minister is on the record — and I know that you have to be positive — that harvest levels are, presumably, going to be coming up fairly soon. Here, in the recent comments, it seems less enthusiastic about that possibility. But surely in the short term it wouldn't make sense to be making these cuts based on harvest levels that the minister thinks are about to jump up during the summer and things like that.

So maybe just a really clear idea of where you think harvesting levels are likely to go over the next number of years.

Hon. P. Bell: I can provide this information. I'll read it into the record, anyway. The harvest levels in '06-07, which was our last kind of big year…. In fact, the composite index price as of last Friday was exactly what it was in May of 2006. So we're starting to come back to that pricing level, and since then it's been under that level.

We were at 68.4 million cubic metres in 2006-07. In 2007-08 it went down to 60.4 million and in 2008-09 down to 49.8 million, and then we bottomed out — or we hope, I should say, that we bottomed out — in '09-10 at 41 million cubic metres.

On a go-forward basis the projections that we based our budget on, and the thinking at the time when the budget went together, was: in '10-11, 45 million cubic metres; in '11-12, 47 million cubic metres; in '12-13, 50 million cubic metres; and '13-14, 53 million cubic metres.

I think that certainly over the last six weeks or so there have been some strong indications that the industry is recovering more quickly than that. I think generally people feel that the American recovery is very tenuous at best and may go into another decline, so even a small amount of incremental timber coming on the market could be a challenge.

However, I do think that many are seeing China as being a significant improvement and moving into higher value — into two and better — lumber. I'm sure the member will recall that in 2009-10 we did about 1.6 billion board feet into China. As of the end of February, we're at 240 percent growth over last year — again, good numbers and significant.

When the budget went together…. I've provided the member with those numbers and the thinking in terms of the recovery. I would argue that we're seeing a faster recovery than that at this point. I think that's good news, but certainly of the analysts out there, many disagree with me today and think that the recovery will be slower.

[1455]

Only a very few are of the view that it is recovering at the pace that I think. If we rely on the analysts' information, certainly they would indicate that these numbers are probably still consistent. I'm hopeful that, in fact, we'll see a faster recovery.

N. Macdonald: Just to understand then, the scenario that the minister and the government thought would be
[ Page 4847 ]
the case and the scenario that the government presumably worked on is a scenario that now the minister is less sure of — right? And hopefully, we are going to get a rebound.

Doesn't that argue for a more consistent view to staffing levels? I mean, if you have a fluctuation that the government did not predict, then very clearly there could be fluctuations one way or another. That would be a constant in something like forestry. Doesn't it make sense, then, that there would be more consistent levels in all areas?

What are the minister's views on that? Based on a scenario that hasn't proven to play out, it seems to argue for a more consistent, more long-term view in terms of how you organize your staff.

Hon. P. Bell: The ministry, or the Forest Service, is over 3,000 employees, and the 204 employee reduction that we went through represents 6 or 7 percent of the total Forest Service staff.

As the member has pointed out on a number of occasions, I have been perhaps considered to be too optimistic from time to time, and if memory serves me correctly, the previous critic occasionally commented that I may be using glasses that have roses on them. But even in my most optimistic outlook, I would hope that we would get to 50 million cubic metres of harvest this year, which would be five million over the projection that we did three or four months ago.

That still represents a 30 percent reduction in the harvest levels from three or four years ago. So even in a very optimistic scenario, it will be some time before we see 70 million cubic metres again. A 6 or 7 percent reduction in staffing seems the reasonable thing to do, given those circumstances.

N. Macdonald: Just in terms of some of the public comments, just to understand that. In response to a report that was done by the International Wood Markets Group, the minister took exception to some of the conclusions. Certainly, I have no sense of the work that this group has done, but the minister very clearly pointed out a number of ways that harvesting levels would be kept up.

At least in March of this year, the minister was talking about harvesting going up and opportunities there for increasing harvesting. How does that link to the minister's sole stated reason for losing 204 employees having to do with a reduction in harvesting levels?

Hon. P. Bell: The report that the member opposite was referring to was a report done that was an analysis of the amount of dead mountain pine beetle timber available to the marketplace. It was predicting significant downfalls in overall available timber starting in 2018. My comments suggested that they were operating under older information and that the information we had at this point indicated 12 to 14 years prior to any significant downfall in the amount of fibre available, depending on the timber supply area. There were alternatives that the chief forester and others were looking at to maintain midterm timber supply.

The report that the member is referring to was indicating a downturn starting in 2018, and of course, that's eight years from now. This budget hasn't considered that far out in terms of staffing levels.

N. Macdonald: Maybe to divert for just one moment. Presumably when these reports come out, staff go through them and provide information to the minister. I guess one of the questions that we have is…? When we were trying to get this report, we couldn't get it from the Ministry of Forests. We had to go to the library and have them order it.

[1500]

Are these reports analyzed? Presumably this was analyzed by the ministry, and then it's something that would be available in the future to the opposition if we asked for it. I don't fully understand the process we went through to ask. But I guess, just as a sideline: is that how things will work in the future?

Hon. P. Bell: The International Wood Markets is a private, for-profit company that produces reports for industry and sells them on a for-profit basis. The fee for the particular report that the member refers to was $2,400 per copy, and the ministry purchased a single copy for its use. It was rapidly…. It was being utilized by individual members within the Forest Service and myself.

I didn't know that the member had asked for a copy, but the report is $2,400. There's an undertaking that you don't photocopy it and so on, so it's a very expensive report. But I'd be happy to work with the member if he wants to, in future, figure out how we can exchange that information so that we don't have incremental costs to the Legislative Library.

N. Macdonald: The vote we're working on — just more for the public…. Obviously, the minister is aware of this. When you look at the appropriation and you look at the long, long list of responsibilities that the appropriation is supposed to look after, clearly, a very small part of it is related to harvesting. I think that as we go through this, we'll be looking at where the actual layoffs are.

You have fire-preparedness, which the minister says was protected. But you also have a number of areas in the appropriation that are listed: forest health issues, adapting to climate change and managing forest carbon, forest stewardship, reforestation practices, timber supply planning and determination, research, forest gene resource conservation and management, reforestation
[ Page 4848 ]
of Crown land and resources, inventory, investments in Crown land.

There's a long list: restoring degraded range land, ecosystems, timber tenure administration, meeting obligations with First Nations. A long list of obligations that seem to be represented in the cuts far beyond harvesting.

The explanation from the minister around harvesting levels, although now he's saying that that was just a partial explanation…. Most of those things talk about a stewardship obligation on the public lands that are really unconnected to harvesting activity. That obligation remains.

The other thing that you hear from the public is that there is a refocusing of the Forest Service. I guess that one of the questions that I have is just around that refocusing and how the Forest Service is included in that. I guess the question I would have is: how much were district managers involved in what is presumed to be the first wave of cuts here?

[1505]

Hon. P. Bell: I was trying to get some specific detail for the member just to get a real flavour for the work and the involvement in the reorg of the ministry and the reprioritization of the ministry. Really, the process probably started, at least at the district manager level and on up, about last October with a conference call where the executive team laid out some of the early thinking to district managers on up throughout the province.

It continued into January, when all the senior managers came together and had a three-day session to continue to think about the reorg, how everything was restructuring within the ministry, what our priorities were and how we were trying to deliver on those priorities.

I just checked with senior staff because I was relatively certain that we actually had a couple of our district managers doing some special projects through this as well, specifically to do with how the ministry was starting to shift its priorities into different areas. They confirmed that in fact there have been at least two. One of them was the district manager for the Prince George forest district — very, very kind of engaged and involved through the whole process.

N. Macdonald: The presumption here is that the 204 are the first of stages of reductions. I mean, that's what everyone is talking about. So maybe that's the question. When is the next stage of cuts coming to this ministry in terms of personnel, and what is the scope? We've heard everything from 100 to 300. So what's the scope of that next stage, if it's coming? And if it is coming, when?

Hon. P. Bell: The deputy minister, on her blog, had identified that any further changes would occur before summer. At least for me, summer starts, I think, on January 22 or whatever that date is — give or take, around there. I'm going to say that that is the date. I guess once it gets into Hansard, then it becomes policy. So we're moving forward on that.

I just want to caution the member a little bit. We are certainly not in a position to talk about numbers today. But we have had a good response from staff across the Forest Service with things like offering to go to reduced workweeks and that type of thing. So we're hopeful that the numbers that the member referred to are not anything that we would be approaching in terms of any further reductions. I think they would fall under the types of numbers, but that work is still ongoing. We will have it complete prior to, as I guess I've just announced, June 22.

N. Macdonald: The minister said January but means June 22.

In the 204 cuts that came, there were eight jobs that were saved, presumably by the process that the minister talks about. Is it accurate to say that that is about the scope of the reorganization? Because what you hear from people, too, is that there has been a freezing on jobs. It's not that easy to go and find some of these solutions, but is it accurate to say that in the 204 positions that were cut, there was only a saving of an additional eight? Or is that a misunderstanding on my part?

[1510]

Hon. P. Bell: Just as I said that summer starts in January, I think that the member's wording…. He knew what he wanted to say, and he probably said something different. But it would have been eight more than 204, so 212. I think that's what the member was thinking. That work's ongoing.

We can't tell you at this point what the number is. I think we're feeling better about it today than we have up until now, in terms of…. The reductions will be smaller. The member said 100 to 300. Certainly, 300 is not a number I've ever heard. But I know…. It's a very uncomfortable time for people in the Forest Service, so that's why I think it's very important that we give people final decisions in the makeup of various offices as soon as we possibly can. And so if I said January, I was maybe just hoping that it was over with already, I guess, but it's not.

N. Macdonald: Maybe just to get back to the detail of this 204, I think that it sort of lays out what's going to happen in the future. On the specifics of the 204 positions that were eliminated: were district managers part of that discussion in the areas where the cuts were made?

Hon. P. Bell: The final decisions in terms of the changes and reductions that were implemented were made
[ Page 4849 ]
by the executive team. The executive team includes — I wanted to say up to, but I guess down to — the regional executive directors. What we would think of as the regional manager would be another title that the member opposite might be aware of. That's on the basis of all of the input that we received through the process. The actual physical decisions were made by the executive team, which includes the regional exec directors.

N. Macdonald: And just to understand that…. I don't, of course, have in front of me the various layers of how the Forest Service is organized. Can you give me an example of who from that lowest level, and just a position…? What are some of the positions that were at the lowest level participating in the decisions around which staff were going to be kept and which staff were going to go?

Hon. P. Bell: I'll try to maybe just…. I realize that it's a nuance in terms of description. The regional executive director is the…. I hate to put it this way, because they're very important individuals, but they are the lowest level of the executive team in the Forest Service. Those three individuals have offices in Prince George, in Kamloops and in Nanaimo — or where the three regional offices are located — and they are the senior individuals in each of those three offices.

N. Macdonald: So district managers did not participate in that decision at all?

Hon. P. Bell: I know this is a nuance, so I just want to try to be as clear as I can. The actual decision was made by the executive team. The advice and input was brought together from the district managers on up. But the physical decision was made by the executive team.

[1515]

N. Macdonald: A part of what I think the public wants to understand is, from my perspective, that the changes are driven not necessarily in a proactive way. I mean, they're driven in a reactive way. I think that most of the public would view it that way, which means that it sort of raises questions about some of the issues that the ministry was working on in past years.

If we go back, I think, to 2008-2009. The concern that the ministry actually had was around losing staff and around retention, and I think there was a program that a previous deputy minister was working on called the ministry's Road Ahead initiative. There was concern that as expertise, as institutional knowledge retires…. The report even produced a report that looked at the challenges with the workforce age distribution, saying that an awful lot of the expertise sat in age groups that were going to retire very, very quickly.

It seems that as you go through the process of this, you're forced to very quickly make changes and that part of the consideration would be what stage people are at in their careers and who are the essential people to keep. Even though the minister characterizes this as mainly harvesting, it really isn't. I mean, we know in our individual areas what the people who were being cut were doing, and it's a wide range of jobs. So it was across the board in terms of who was being cut. It's not related to just one area. It's an across-the-board cut.

Coming back to the district manager, I guess the question is: how have you managed the very clear problem that you identified — by you, I mean the ministry — two or three years ago about losing that expertise? How have you managed these cuts to make sure that some of the people you want to have there for the next 20 years are retained and don't move off into other careers?

How do you make sure that you're making the choices that you want to make in a thoughtful way if you don't include district managers in that decision? These are people who would know very clearly the positions that they want to retain and the positions that they don't.

There are a whole bunch of questions in there, but I think that the minister understands the direction that I'm going with this.

Hon. P. Bell: I want to touch on a few pieces here. The first one is that, as I mentioned earlier, the initial engagement with district managers on this was in October of 2009. Obviously, the executive had been working on it for some time before that, and then re-engagement in January — district managers physically working on the special projects to help the transformation of the Forest Service.

I'm very supportive and understand the importance of front-line people being engaged in the discussions around transformation, so I'm a big proponent of having decisions made as close to the local level as I can. But in the end, when there are difficult decisions of this nature where you're talking about 204 people and their lives and their careers, it is appropriate, in my view, for the executive team to shoulder that burden and that responsibility.

[1520]

On the advice that was provided to the executive team from each of the respective senior managers from around the province — that's how those decisions were made.

Also, just with regards to the report that the member referred to the Road Ahead, it actually helped guide many of the decisions in terms of changes that were necessary — if there were reductions, where they should occur and which people are important from a corporate knowledge perspective. Those were all components of those decisions, and the Road Ahead was part of the decision matrix that was included in the work that the
[ Page 4850 ]
executive team took on. The initial decision certainly, I think, reflects the priorities and the need to maintain corporate leadership, the need to maintain corporate knowledge.

One of the things that does occur because of the collective agreement that we have…. There are bumping provisions, and those are things that are outside of our control. It could be that even though an initial decision is made in terms of trying to maintain a specific individual because of a need that's been expressed, they could still be vulnerable from a bumping perspective. We don't have control over that piece.

In terms of timing, October forward — so a pretty significant amount of time went into this. In terms of some of the work that's gone on, we have included that. In terms of the level of decision, the executive team, I think, ultimately is the one that has to take on that decision, and it's one that they did with great professionalism. I think those at least touch on the majority of items that the member asked.

N. Macdonald: I appreciated very much that the minister provided the breakdown for me.

Of the 204 positions, how many of those positions were offered either bridging towards retirement or various plans that would make retirement possible? Presuming, from the reports that the deputy ministers have provided…. They point to a concern about the need to retain staff forward into the next ten and 20 years — retaining some of the younger expertise and not ending up with a Forest Service that was going to retire almost en masse within the next five to ten years. Of the 204, how many were offered bridging or some sort of incentive to help them into retirement?

[J. Thornthwaite in the chair.]

Hon. P. Bell: There was no early retirement package offered this time around. It's a corporate decision, a cross-government decision. You wouldn't do it ministry by ministry. It would be a decision that would be made corporately.

[1525]

Where we are today is in the early stages of a 90-day process, where the 204 individuals that received notification are going through a voluntary process. We're looking for other positions, or we're looking for opportunities for those individuals across government — not just in the Forest Service but across government.

Then after that 90-day period expires, depending on the individual, there's an additional between four- and six-week formal period of time. So it's give or take 120 to 140 days that we work with the individuals to try and find placements for them.

Historically it has varied, depending on the point in time. There have been times that we've been very, very successful in placements and been able to place the vast majority. There are other times that it's been more challenging.

Also, just so the member understands, the collective agreement actually requires us to eliminate positions, not individuals, so that constrains our ability in terms of how you make those changes.

N. Macdonald: Within the Ministry of Forests, though, there is a unique problem that the deputy minister was focusing on and had made, as an objective, plans to deal with the fact that you have a demographic that's going to be problematic in the long term. These aren't conclusions that I've reached. These are conclusions that the deputy minister had reached and was working to deal with.

Why did the minister, in this case, not specifically argue for doing things differently than other ministries to deal with a problem that is perhaps unique — but maybe not — but is certainly real in this ministry, which is that you have a demographic issue that needs to be dealt with? I guess the question is: why is an argument not being made for some sort of pensions or buyouts or some sort of a program that would work specifically for this ministry?

Hon. P. Bell: I am stretching my memory back here a bit to a meeting that I had some time ago. My recollection, confirmed by staff, is that the Forest Service is not unique in the age of the workforce. It is very average relative to other ministries in government. There is this large shift through to retirement in the majority of ministries.

It was and is a corporate decision in terms of whether you would go out with an early retirement package, and if you did it, to be fair in government, you would do it governmentwide or not at all. You wouldn't do it for any specific ministry.

N. Macdonald: Just to refer to one of the ministry documents, which is a response to the changing business environment. This is from December 3, 2009. The ministry is very clear here in saying that the age distribution's not balanced, which poses risks around knowledge transfer and succession.

I was suggesting earlier that the minister might make that argument to manage these cuts differently. Maybe it's something that the government as a whole needs to think about. Why not go with what the ministry knows is going to be a problem and at least deal with the cuts in a way that is going to be consistent with the goals that the ministry has?

[1530]

Hon. P. Bell: The document that the member is referring to, although it is from the Ministry of Forests and
[ Page 4851 ]
Range, could be from any ministry in government, and he would see a similar profile in terms of aging. That is really the reasoning behind…. If you're going to offer some sort of a retirement package or something, you would do it on a governmentwide basis as opposed to a ministry, to be fair. Otherwise, if I'm in the Ministry of Environment, I'm saying: "How come they get it and I don't get it?"

I think you have to either go governmentwide or not at all.

N. Macdonald: Just referring to slide 6, then, what it points out is…. It's actually a comparison. In building the case that the ministry at that time was building — that the age distribution wasn't balanced — it compares to the B.C. public service as a whole. What it points out is that in some of these key ranges…. In 50 to 54 there is a 7 percent higher level in the Ministry of Forests compared to the public service as a whole. It says that in the 45-to-49 range…. Just quickly, it looks like it's about 8 percent higher.

The minister would have had an opportunity to point out that disparity. When you look back, for instance, at the age group 25 to 29, it is a very small number that you have within the Ministry of Forests and Range compared to the B.C. public service as a whole.

I know statistics can mask all sorts of things and mean all sorts of things, but pretty clearly, there is a problem that the ministry needs to deal with. There would have been an opportunity to deal with that.

Just in looking at the 204 individuals, do we have an average age or an average level of experience that is being lost here? Does the minister have that sort of information?

Hon. P. Bell: The question that the member asks is not possible for me to answer because of the bumping process that we are currently in. The 204 individuals that could potentially be impacted…. Hopefully, there won't be 204. Hopefully, it'll be something less than that as we find other positions for them both within the Forest Service and in other agencies across government.

Because it is positions that have been eliminated, not individuals, those individuals…. Inside the BCGEU contract, obviously, it's different for exempted and unionized workforce. The processes are different. Until we get through that process, it's not possible to answer that question.

N. Macdonald: Then maybe I'll just ask the minister to comment anecdotally. Obviously, the MLAs that are in our rural caucus talk about their experience in their communities, so we have an anecdotal idea about what has happened in our areas.

Just what is the minister's sense? Are we losing mainly — especially with the union contracts, I would assume — the unionized staff? Are we losing mainly the younger members that the ministry was trying to retain?

I'll just go back to a previous deputy minister, where very specifically, in previous service plans — it was even in there in the ministry service plans — there was a recruitment issue and a human resource challenge, including knowledge transfer. The ministry was working to implement a comprehensive human resource strategy.

[1535]

All of those things aimed at what ministry documents have identified here as a demographic challenge for the ministry, yet it doesn't seem to be reflected in what I would characterize as sort of the reactive need to cut positions really quickly.

The question is: does the minister have a sense of who is being lost? Is it the young, new staff that, presumably, the ministry had as an objective to keep?

Hon. P. Bell: I just wanted to touch on a few things for the member opposite. The human resource plan is still in place and is updated annually, and knowledge transfer and succession planning are two key elements of the HR plan. Those continue to be priorities. Just because they don't necessarily appear in a service plan doesn't mean that they aren't priorities.

The service plan, largely, is a tool that we use to talk publicly about the priorities of the Forest Service, particularly if we're making a shift in terms of business attraction and trying to develop that end of the business. We understand that the 204 individuals…. It's a mix of people from one end of the spectrum to the other.

Where the real challenge comes here is that with the BCGEU contract, the bumping process inevitably disadvantages newer employees. These are oftentimes younger, but not always. We've had people that have left a company and joined the Forest Service, and they may be an older employee as well. Just because they're new to government doesn't necessarily mean that they're young, although that's often the case.

The other thing that's occurring as a backdrop behind all of this is ongoing retirements. I think there were a number of people who were waiting for a retirement package, and when it became obvious that that was not in the mix, people decided to go ahead and retire anyway. At that point they'd already qualified for their full retirement packages but were waiting. That then means you get an older demographic moving out of the Forest Service, and the opportunity for those younger people still exists.

I'm not in any way trying to be evasive. It's just that…. I could answer this question six months from now. I could answer this question and say: "Here's actually what happened." It's just that today, because of the bumping processes that are involved, I'm unable to accurately answer the member's question.
[ Page 4852 ]

N. Macdonald: Okay. One of the questions that comes up, too, is that there was a natural process that the ministry was anticipating in terms of people retiring. When you look at some of the numbers that we're talking about, we're talking about a four- or five-year period where there would have been an evolution of members out and there would have been an ability to retain. I often wonder why there is not a longer-term view taken with this sort of restructuring.

[1540]

Did the minister consider that? It's arguing that over a four- or five-year period the clear ministry need is to retain expertise that's going to be there for the next ten or 20 years. It just seems possibly a much more reasonable way to go. Is this something the minister put to his cabinet colleagues — about going forward in that way?

Hon. P. Bell: The member said it's important that we have a longer-term view of our human resource plan, and certainly, we agree with that. You have to have a longer-term view.

He also asks in terms of retirements, I think, to interpret the question he was asking. What is a typical number of retirements in any given year? We're expecting about 140 retirements this year. It's the best level of information that we have, and that's a fairly constant number going out into the future. We think it's about 140 per year. But the important thing for the member to know is that oftentimes those positions will end up being filled by some of the people who may have received their notice.

Although there are 140 people that we're expecting will retire — some of those clearly will be in the next few months — it could be that one of those 204 individuals who have received notice will end up filling some of those positions. Historically we have found varying degrees of success in terms of taking people that have received notices and moving them into other positions — sometimes very high degrees of success, other times very challenging.

We don't really know until we get into it what we're faced with. But the view of long-term planning — that's clearly in the human resource plan. The use of those retirement positions to keep young people in the Forest Service is clearly something that we work towards.

N. Macdonald: Okay, thank you. Maybe we'll start to then go to some of the specifics around the cuts, especially in local areas. Then we'll look at some of the cuts that have taken place in the capital region. This has been somewhat difficult to get our heads around. I'll just make a couple of comments and then give the minister an opportunity to respond.

One of them is in terms of talking to people within the community. I think there was an e-mail that was sent out. I don't know if this is common. I understand that with cuts, obviously, there's a sensitivity, but there was instruction not to talk to local MLAs. I just wonder how that makes sense. Is that common?

Certainly, it seems to me that it complicates rather than simplifies the issue. I'll just explain from my perspective. The minister is from a small community. Obviously, in a small community — and Prince George is relatively small; it'd be the same experience that the minister would have — you do hear everything. But it's just in this context of: "Well, we had an e-mail saying we couldn't talk to you." It just seems to complicate a great deal an understanding — and, I think, an appropriate understanding — from MLAs in terms of what's going on.

The second point I would make — and maybe I'm missing the point of why it went out — is just that it is a professional staff that is dealing with communication issues all the time. Therefore, the appropriateness of what is said…. I have consistently found, in dealing with the public service, a really clear idea of what is appropriate to say to an elected official and what is beyond the realm of what would be discussed with any public figure.

[1545]

Just a quick question around why that was done, if it was done. Is that common practice, or is that something that was particularly unique to this situation?

Hon. P. Bell: I'm just going to ask for a little clarity from the member, if I can. He suggested that there was an e-mail sent out — I gathered it was an e-mail; I'm not sure if it was an e-mail — that asked, I gather, Forest Service staff not to communicate with maybe just opposition or all….

If I could understand the timing around that, that would be helpful, because I know there was one that I…. Well, I shouldn't say I directed it, but I guess I kind of directed. I was aware that the opposition researchers were contacting all of the offices and asking for impacts, and as the member will recall, I provided him with a copy of that.

At that point we told the offices that it wasn't necessary to provide that information, that it had already been provided to the opposition. So it's just a little unclear if it was around that or if it was something else that I'm not aware of.

N. Macdonald: I guess we'll just work with the presumption that it would be around that. I think it's just more of a general comment that if it was to become a pattern, it's problematic, because I think we're both served….

The minister was forthcoming with the numbers, and I think that saved a lot of time. Let's assume that it was within that context and then just that if there are similar sorts of e-mails, we would avoid that sort of message
[ Page 4853 ]
being sent. The discussion wasn't something that was advantageous to all involved.

In terms of some of the specific cuts, a question that has come up was just around the…. Of course, in this sort of situation, where there are a number of cuts, people are asking us specific questions about areas that they see as expansions or money being spent where they think, even if it's simply symbolic, it shouldn't be spent.

Very often there are good reasons for why there's expansion, but one of them that people have asked about is the executive and support services, where there's a budget increase. As I say, very often there are good reasons for that, but maybe the minister can provide that explanation publicly for the increase there when so many other areas seem to be cut.

[1550]

Hon. P. Bell: I'll read this into the record for the member because it is a bit complicated. It's actually a significant reduction in exec services, but it's reflective of an accounting change that resulted in what appears to be a $1.7 million increase.

There was historically $7.8 million in recoveries for executive and support services. Those costs are now being borne by Citizens' Services, or the value of that goes back to Citizens' Services. We used to get a $7.8 million recovery there. That is now gone. Replacing that, we have an additional cost of $1.7 million in amortization for the air tanker base renovations that we've done over the last couple of years. So our amortization has gone up by $1.7 million.

The total of all that ends up with a net reduction in the executive and support services of $6.1 million for last year. It is largely a reflection of the historical $7.8 million in recoveries that the ministry would receive to offset expenses. That no longer exists.

N. Macdonald: Thank you for that.

The second area that comes up is around the ministers of state. There are two of them, and of course, the minister of state for silviculture I see at a lot of the places, so I know what he's up to. Nevertheless, it does come as a question. People wonder: why that expense? I realize it's very, very small, but when you have 204 people whose lives are being impacted, there's tremendous sensitivity.

Nothing to degrade the performance of the minister of silviculture and the many places he's spoken. In fact, quite the contrary. He had a very good speech where he acknowledged me, and I appreciated it very much.

The question, though, is: does the minister have a report of the meetings that the two ministers of state have attended, the service that they provide? It's not something you have to stand up and provide immediately, but is there documentation that you can provide on the two ministers of state — the rationale?

Well, here I'm including the…. I presume it's a minister of state, but it may be a parliamentary secretary for pine beetle. Is it a parliamentary secretary? If the minister's forgotten, that's not a….

Interjection.

N. Macdonald: Oh, it's not. Okay.

Nevertheless, in the public's mind, it's perceived as…. Like I say, this is something that could be in a written report or just in a letter that's provided. I'll just ask if the minister will undertake to do that.

Hon. P. Bell: Although it will come as an extreme disappointment to the member for Nechako Lakes, he's not a minister of state. He's a parliamentary secretary as well.

Both of the positions the member refers to are parliamentary secretaries. The parliamentary secretary for pine beetle reports to the Minister of Community Development, which is where the pine beetle economic recovery group works from.

The Parliamentary Secretary for Silviculture. There is a small stipend. I don't recall how much it is, but it's relatively nominal for that role, and there are no additional support services.

[1555]

While the ministry does provide the stipend, it is relatively nominal. I know it's in the Members' Handbook. I don't recall what it was. I seem to think $10,000, but I don't remember that — in that range, anyway.

But there aren't any other costs associated with that, and I would strongly argue that we're getting far greater value than that from the diligent, hard-working efforts of the member for Nechako Lakes, who travels far and wide to bring forward the message of a strong silviculture regime. He is very successful in doing that and is coming forward with tremendous recommendations — that, I'm sure, the opposition will eagerly and gleefully embrace — to move forward.

I mean, if the member wants some details around areas that the member has been speaking of, I'm sure we can talk to the parliamentary secretary. I think that, technically, the parliamentary secretary acts as a private member. FOI rules, I think, are a bit different. I'm not entirely sure. If the member just wants to specifically detail some of the information, we could see what's available and what isn't. But it's kind of beyond my scope of knowledge as to what could be provided at this point.

N. Macdonald: The next area that I want to look at is just the scope of the work that's involved. As I mentioned when we read through the list that the Ministry of Forests is responsible for, I think all of us that live in communities that are primarily forestry-dependent know that a ministry office represents not only people
[ Page 4854 ]
who are responsible for harvesting and being effective in terms of supporting the local businesses, the local logging that takes place.

The areas that I represent have been very well served. The turnaround time in Columbia district, as it would have formerly been, you know, would very often be 48 hours — very good turnaround times. This is anecdotal, again, but it's not anecdotal from ministry staff. It's anecdotal from people that are in the field and to whom that's important — concern about that not being maintained with the reorganization.

But there's also…. You go to the Ministry of Forests, very often, for things like heli-skiing, tenure issues. It's where people are snowmobiling. It's around caribou. It's around a whole host of issues, including where you go to get permission to get firewood. I mean, there's a whole host of things that staff are dealing with, and when you look at the particulars of the positions that are lost, a number of them, you wonder how the ministry's stated responsibilities for being stewards of the land is going to be maintained with those local positions.

Here we're talking about pretty well half of the positions coming from local communities, where their work is recognized as being far beyond simply related to the harvesting role. As the minister would know, beyond that, these are very often important local jobs in communities, presumably, like Burns Lake, Clearwater and certainly Invermere. They're important jobs, and we don't have a tremendous number.

I guess the question is: is there a recognition from the minister that that's the sort of expertise that is being lost? And the other question is: if not the Ministry of Forests, then who is going to do this? Who is going to provide the stewardship role on our public lands?

[1600]

Hon. P. Bell: I think the member asked two questions. The first one was around the importance of forest district offices in small communities and what were we thinking about services provided in those communities as we made our decisions around where reductions would take place. I think the second question was: who is going to do the stewardship on the land and how is that going to be done? I'm going to try and address those as separate questions.

First of all, when we looked through all of the decisions around where we would maintain full offices, where we'd move to kind of a secondary district office and in the case of Prince Rupert where we were closing offices, we looked at it through a number of lenses: certainly, the harvest levels but also the likely long-term harvest levels for that particular area — what the likelihood of harvest levels was — and what the next closest office would be.

Is there an office that's very close by that could provide the same services? Also, what other government offices are there in the area that could provide broad corporate services to people?

We looked at all of those different lenses. Obviously, the one decision that was very difficult was the decision in Prince Rupert that meant an office closure. I never like to have to make those decisions. Those are probably the most difficult ones, where you're physically closing an office, but it was one that we felt we had to make.

The other one that I'll note, although I shouldn't say this…. I mean, I could go through every office, I suppose. I feel strongly about all of them. But the other one that was really challenging was Castlegar, which was about 25 percent of the workforce in Castlegar, from 60 down to 45. That one was particularly challenging. Proximity issues suggested that that was probably the right decision there in terms of Nelson.

All of those things incorporated parts of the decision. I very much agree with the member opposite that in small rural communities, even a couple of positions can impact the local economy, so we're really careful to try and minimize that.

The second question, specifically with regard to stewardship. Again, we're confident that we can meet all of our obligations. I think that the member opposite knows about the regional management coordination project, where we're cross-training compliance enforcement officers in all ministries to be able to perform each other's duties. That's been helpful in terms of putting additional eyes and ears on the land and making sure that we're meeting all of our objectives and requirements. Certainly, we're comfortable that we're going to be able to fulfil all of our obligations in terms of stewardship.

B. Routley: I'd like to thank the minister for this opportunity to ask a few questions of my own.

I want to start out by following up on the compliance and enforcement issues. Basically, what I see here is that the minister has, effectively, taken a broad axe to 2004 positions. Including cuts announced in January, there are about 250 jobs that have been earmarked for elimination in the first four months of 2010, and now we hear of more cuts that are lying ahead.

These terminations come on the heels of cuts that have already stretched the ministry's compliance and enforcement resources far too thin. In November of 2004 there was a report done called Axing the Forest Service. The study, drawing on government employment data, found that between 2001 and 2004 the provincial government had eliminated 304 compliance and enforcement positions, so effectively, there's no department that's been hit harder.

[1605]

Back in 2003 we heard this government announce that they were going to be going from a regulatory model…. We had all kinds of regulations in the old Forest Practices Code. The government effectively went to a model that
[ Page 4855 ]
they said was going to be effectively run on compliance and enforcement.

Back in 2003…. And I'll just remind you that the government of the day at that time, which was the same government, was saying there'd be $1 million in terms of fines or jail time for people, effectively. What I see and the people of B.C. are concerned about is that we see a deterioration in the amount of compliance and enforcement.

My question to the minister is: is there a strategic plan attached to these cuts? Is this essentially just the government either relying on the fox looking after the chicken coop, or is this government contracting out their responsibility to third parties, as the minister has talked about, various other international bodies that are requiring certain things of forest companies?

That's the question to the minister. Have you got a strategic plan, and if so, could you give us an overview of what that strategic plan looks like, how many compliance officers are going to be there in the future — that kind of thing?

Hon. P. Bell: I'm going to walk the member opposite through a few numbers that I think are relevant.

Part of the report that the member is referring to, and some other reporting that's been out there, has indicated a reduction in the number of inspections going on. That actually, I think, masks what really is happening.

The way inspections have been counted has changed. The Forest Service used to count…. Just as an example, if they went out and inspected a road, they might inspect four, five, eight or ten different sites on a road, and each would count as a single inspection. We now just do a single road inspection, and all components of that would fall under the count, so that actually becomes one instead of four, five or six. The same holds true in terms of inspections that we do on blocks or on sites. We count those as a single inspection.

The RMCP, the regional management coordination project that I spoke of already, has also been very effective. For last year the total C and E inspections were just under 15,000 — 14,772. As I said, we are counting those differently now. That represents virtually a visit out to a site in most cases.

I would refer the member opposite to the Forest Practices Board, which is a very respected organization, an arm's-length organization within the province that monitors the Crown's performance and licensee performance and performs audits on an ongoing basis. In their March 2010 report…. I'm just taking a quote out of the report: "Ministry of Forests and Range has a mature C and E framework with no reportable weaknesses identified in the audit." So they were confident in the model that we are operating under.

Then finally, I think the other thing that's important…. The member spoke about third-party certification. While I don't necessarily think that third-party certification is a replacement for the province's responsibility, I think it is a testament as to the quality of work that goes on within the province.

I think that when you have an organization like the Forest Stewardship Council coming on board and supporting and saying that the operational standards in the Great Bear rain forest represent the highest environmental standards in the world, although it's not a replacement, it's a testament to the work that's going on.

I appreciate the member opposite's position. I understand his thinking on this, but I think that there is value to looking at what the rest of the world says about British Columbia's forest industry.

[1610]

Clearly, both the environmental community and the third-party certifiers have said that they believe B.C. is a world leader in terms of its operational standards. So I think we have lots to be proud of. We're a long way away from the days when people used to chain themselves up to trees until the police showed up, and even then I suppose they just stayed there for a while.

B. Routley: I just want to be certain that I have this correct. I understand that in about 2007 there were additional decisions required of C and E staff. For example, the Ministry of Environment passed on some of its work to C and E, as well as for energy, mines, even petroleum resources.

First of all, do I have that correct? And if so, what's the impact on all of those departments that you're also responsible for, for oversight and compliance and enforcement?

Hon. P. Bell: I mentioned earlier to the member the regional management coordination project or RMCP that was initiated in Terrace. I think that's what the member opposite is referring to. It is a shift in the model of compliance and enforcement, and I'll just walk him through the shift.

What we did was we brought all of the compliance and enforcement officers together from each of the respective ministries — Ministry of Environment; Ministry of Energy, Mines and Petroleum Resources; Ministry of Forests and Range; Ministry of Agriculture and Lands. Each one of those individuals was cross-trained.

Now, the member opposite, I know, worked in the sawmilling industry. I worked in the log-harvesting industry, so between the two of us we've got both sides of that covered off. What I can share with the member is that… Well, my personal experience was that you would have a number of different inspectors come out to look at your log-harvesting site.

You might have someone from Forests, clearly, that would come out. Environment might come out and look at a different aspect of the site. If you had a gravel
[ Page 4856 ]
pit, Energy and Mines would come out and look at the gravel pit. If you had maybe a land bog — a gravel pit typically involved a land tenure — Agriculture and Lands. You might have that individual. So you had four different people, not always but typically from the same community, as inspectors coming out. They might all show up on the same day, or more often than not they'd show up on a few days, because they were never talking to each other.

RMCP, regional management coordination project, brings all of those people together, although they're still hosted in each of their individual ministries. Each week they meet, and they come up with a plan as to how they're going to inspect the various sites. Then, instead of having two individuals going to a single site, performing two separate inspections, one of them will go to one site and one will go to another site and do each other's work. So a far more efficient way of delivering those services.

It allows us to do more inspections on a per-site basis. I shouldn't say it's more inspections. Maybe it's counted differently. But it allows us to be more effective in the work that we do by getting people out more frequently on to each of the sites.

I know, as someone who worked in the log-harvesting industry for a number of years, that from my perspective it's far more efficient. If I was able to deal with just one single individual and if he came out to the site and said, "Gee, I'd like you to do this and this and this," and then the next day if he was back, or three or four days later, you could point out to him that you'd accomplished all those things rather than having to walk through all those discussions with a new person.

I think it's a change in the way we are doing business. It's been very well received. It doesn't mean a lower level of compliance and enforcement at all. In fact, I would argue that it means more compliance and enforcement. It's been a pretty successful model, and I'm pretty sure that's what the member is referring to.

B. Routley: Well, that raises another question. If there are other activities going on other than the typical Forests and Range, are these efforts paid for out of other envelopes from other ministries? Or is all of the money coming…? Is it essentially reported under C and E, or are there other moneys from other ministries, that you're actually managing people who are funded in another way?

[1615]

Hon. P. Bell: As I said, each individual continues to be hosted by the ministry and funded through the ministry that they were originally employed by. It still is a Forest Service staff person driving a green Forest Service pickup showing up on site. However, that person has been trained to also do the work of the Ministry of Environment person and the Ministry of Energy, Mines and Petroleum Resources person and the Land Act individual.

While there is no across-accounting in terms of…. If the Forest Service staff person did a forestry-related inspection and maybe an environment-related inspection, we don't do an internal cost transfer or an internal accounting transfer from one ministry to the other. Conversely, if a Ministry of Environment staff person comes to the site and does a forestry inspection, they wouldn't bill through that cost.

These individuals typically meet weekly and establish their plan for the week in terms of what work needs to be done. Then they allocate each of their individual resources out into the various areas that are necessary. So it's not a consolidation of resources. The resources continue to be where they were originally located. It's just a more effective model of, first of all, communication and, then, the cross-training that took place in order to allow this to occur.

B. Routley: Could you give me the number of full-time-equivalents that would be assigned to various ministries that are under your managerial responsibility?

Hon. P. Bell: Maybe I didn't explain myself fully. Each of the compliance and enforcement individuals that are located in the other ministries continue to be the responsibility of that minister. I don't have those numbers here. I don't know how many individuals there are in Environment, as an example, or in Lands, but I can tell the member that once we are through the workforce adjustment process inside the Ministry of Forests and Range, there are 199 compliance and enforcement individuals.

B. Routley: Could you give us some indication of the level of fines that have been handed out in the last budget year as compared to, say, 2003-2004, when we first talked about the million-dollar fines? Of course, the public would be interested in how things have changed from, you know, how much was actually handed out in terms of compliance costs and fines back in 2003-2004, as compared to, say, last year.

Hon. P. Bell: We don't have that level of information, in particular. We do have some current '09-10 information. But going back to '03-04…. We don't have that level of information, but we will get it. I think that this is the first official…. We'll provide this information to the member as soon as we can, but it will take some time to get that level of information back.

[1620]

I will just add, though, for the member opposite…. I know that the member is relating the level of fines to the level of compliance and enforcement activity that's
[ Page 4857 ]
taking place on the land base. I'm not sure that's entirely fair, because our sense is that industry continues to do a much better job delivering on their responsibilities as they better understand the regulations they're working in.

I think that's demonstrated clearly through the third-party certification and audits that go on by both the Forest Practices Board and the third-party certifiers, which continue to support the standards that we have here in B.C. at an all-time high.

We will provide that information in writing back to the member.

B. Routley: Another important question is…. We know that there have been all these cuts. What skills have been lost, and what skills remain? It would be interesting to know what level of skills we're actually going to have left when you go through all this process and what kinds of skills we did have.

Are there any gaps between what we had in terms of skill levels as compared to what's going to be left? Has there been any overview in terms of planning? I'm actually looking at what you had in terms of skills as compared to what you have left today. As I say, are there any gaps in the skills necessary to do effective compliance and enforcement work?

Hon. P. Bell: Sometimes you, unfortunately in this format, tend to start asking for answers before the member opposite completes his question. I just thought I heard at the tail end of his question that it related specifically to the C and E workforce. I just wonder if the member could tell me whether it's specific to the C and E or if it's a broad question that he's asking.

B. Routley: Yes, Minister, it's C and E.

[1625]

Hon. P. Bell: The member asks a complex question, so it's hard to answer it.

I think the first thing the member should know is that one of the decisions we made was that instead of having a manager or a supervisor in each district for the compliance and enforcement team, of which there were 29 districts, we went down to a regional or subregional supervisor, of which there are eight.

The member opposite would immediately say that 29 minus eight is 21 positions, which is what I just did. It doesn't work out that way. They are partial positions. They are partial FTEs that have responsibility in those areas, so it doesn't add up to 21 individuals at all.

The breakout in terms of where the positions come from — I have that and certainly could provide it. The mix is a combination of individuals, but it represents 11 percent of the compliance and enforcement team that we had in place previously. It appears to be STOs, scientific tech officers, or resource technologists. There are three C and E foresters in the mix.

I think that there are no particular gaps that we should worry about, that there is sufficient coverage to meet all of our needs.

[J. Slater in the chair.]

N. Macdonald: I apologize if I missed certain parts of this, but to just continue along that line, just to understand compliance and enforcement…. I'm sure that my compatriot here sort of talked about initially, back to 2003, where there were pretty big promises around how tough the enforcement was going to be as the government moved into what was more of a self-regulation model. That hasn't been the case.

Now, the minister, I believe — in just talking to the member for Cowichan Valley — said that you really don't have numbers on the levels of fines. So okay here.

Hon. P. Bell: I have some of this year's. I just don't have 2003-04.

N. Macdonald: Oh, so for the comparison.

Just to understand how the fines work. Does the Ministry of Forests itself collect fines? And are you the responsible…? What's the mechanism for paying those fines, and is there an appeal process? Can you just run through how the Ministry of Forests runs the fine system?

[1630]

Hon. P. Bell: There are two elements to the question in terms of who collects the money and where the money goes. The second element is what the appeal process is in the event that someone feels that they have been treated unfairly in the process. So I'll just deal with those in the reverse order.

In terms of the appeal process, there are three levels of appeal. The first one is the opportunity to be heard, and that's typically done by the next level up from the compliance and enforcement officer. If someone is presented with a compliance and enforcement action that they feel is inappropriate, they can ask for the opportunity to be heard, and that's done at a local level.

The second level is through the Forest Appeals Commission. That's a provincial body that operates in a quasi-judicial fashion at arm's length and hears complaints of compliance, enforcement and other actions where perhaps an individual feels that they were not fairly treated. A final course of appeal would be a judicial review, which is, of course, in the B.C. Supreme Court. So that would be the third level.

In terms of the collection of fines, we issue a ticket or a fine. In terms of the collection of the fine, it is the old Ministry of Provincial Revenue which was wound up
[ Page 4858 ]
and brought into the Ministry of Finance. So that body of employees that used to be the Ministry of Provincial Revenue is all now in the Ministry of Finance. Those are the folks who are responsible for collecting the money once the fine has been laid. Finally, the funds from those fines go to general revenue, not to the ministry.

B. Routley: I don't think we got an answer as to how many are left working in compliance and enforcement. Now that there have been all these reductions, did we get a total number of who's left?

Hon. P. Bell: These questions have all been very complex, and I know I did provide the number on two occasions already, but it may have slipped through the process. It's 199.

B. Routley: Given the line of questioning that I was going through, Minister, I would be negligent if I didn't follow up on the question about…. There is compliance. The amount of money — I gather you're going to get us that amount, the amount from 2001 to today.

The other part of that was that back in 2003, there was talk about jail time. I would be remiss if I didn't ask exactly how many people have gone to jail. Has anybody had any kinds of serious actions, threats in terms of anything to do with compliance and enforcement issues?

I'm just not sure what that was about back in 2003, so I think the public needs to have an updated report on where we're at.

Hon. P. Bell: The member opposite has enhanced the scope of the initial question, but we'd be happy to enhance the scope of the answer that we'll provide him.

B. Routley: I'd like to move to safety right now.

[1635]

Just to give you a bit of context, Minister, I first started out in the forest industry back in 1970 and spent a number of years on safety and health committees before becoming chair of the safety committee. During that time I had to deal with several tragedies where there were fatalities in the industry. Those deaths still come to mind, and I know we've got the April 28 Day of Mourning coming up.

Turning to safety for a minute, I know that there have been several reports. The report from the Auditor General…. Recommendation No. 8 was that he recommended that "robust safety planning in all aspects of forest operations should be made mandatory" by the Ministry of Forests and Range. Could you tell me if you've taken any action on regard to that recommendation No. 8, and if not, why not?

Hon. P. Bell: The member opposite may have missed it, but in fact that recommendation was just followed up, I think it was two or maybe three weeks ago, in a news release. The Association of B.C. Forest Professionals now, inside their bylaws, requires safety to be included in all planning activities.

B. Routley: I'm not sure that that's action by the Ministry of Forests and Range. I don't know whether the Ministry of Forests and Range has actually taken any action in terms of this issue. In 2007 the chief coroner for the province recommended worker health and safety, for example, with road user safety being included as an objective in all forest stewardship plans.

More recently the chief coroner, as a result of a coroner's inquest into a skidder operator's death just a short time ago, said he recommended "that B.C. Timber Sales require, in their terms of reference and instructions to consultants who develop harvest plans, that steep slope hazards and safety of workers be considered in planning and development of cutblocks to ensure that there is clear understanding of safety as a priority over economic and environmental considerations."

Again, those are pretty clear recommendations from the chief coroner as well as from the Attorney General. While you talked about what foresters were going to do, what exactly is your ministry going to do in terms of compliance?

Hon. P. Bell: A few things to back up. I was probably remiss in telling the member opposite that about something over half — I think it's about two-thirds — of the members of the Association of B.C. Forest Professionals are also Forest Service employees. We're very actively involved in that particular association, and we're actively involved in the establishment of the standards that I spoke about a few minutes ago.

Also, the Ministry of Forests and Range is very involved with the Forest Safety Council and has been working with them and, I think, arguably has seen very good results. I was just looking at some numbers the other day provided to me by Reynold Hert, who's the CEO of the Forest Safety Council, showing that accidents per 100,000 cubic metres of timber harvested were about half of what they were three or four years ago.

[1640]

I think what's remarkable about that is that that's in a time where very, very difficult economic circumstances lay. Typically, you would expect that the industry would be looking to cut corners at that point. In fact, what we've seen is that that's not the case, that they are making significant headway.

That said, one accident is too many — absolutely. One death is too many, and that's why we're so focused on lots of initiatives around…. The member opposite will probably recall that we now have a speeding initiative underway, where we're working with radar guns, with the RCMP and with other enforcement officers on
[ Page 4859 ]
the back roads of British Columbia, issuing tickets for people speeding on back roads. That's why we've gone to standardized radio protocols on all of our forest service roads — to ensure that people are communicating effectively — and why B.C. Timber Sales requires all companies bidding on timber sale licences to be SAFE-certified companies.

Our silviculture contractors are moving that way. There's been tremendous headway, and I'm in no way suggesting that we are there yet. There's always more work to be done. I think probably the member is aware that one of the areas the Forest Safety Council is now turning its mind to is actually manufacturing. While they believe that there's been significant headway made in the bush in terms of the harvesting side, they think that one of the areas that they want to focus their attention on and make progress on is on the manufacturing side.

I know that's where the member opposite comes from. I'm sure — if he didn't already know that that was where they're turning their mind — that he's happy about that, because I'm sure he's had colleagues that he's had to deal with that have been injured and/or killed at one time or another in the industry.

Finally, I think just to round out the answer, the member asked if BCTS has modified their standards specifically for steep slope and generally around safety, and yes, they have, is the answer to that. So we've responded to all of those reports, I think, in a pretty effective way. I think we're seeing good results, and I will continue to place a high priority on forest worker safety.

B. Routley: It's clear that the ministry has responsibility for soil, for timber, for wildlife, fish, water, biodiversity, cultural heritage, resources, resource features, recreation resources, visual quality, forage and associated plant communities, just to name a few.

Can the minister tell me why the forest workers' health and safety is not included as an objective in the Forest and Range Practices Act? Why isn't something as important as the workers who are out there every day, not only in the field under your ministry but the other workers…? Why is it not a requirement and an objective of the Forest and Range Practices Act to have good forest worker health and safety rules and regulations?

Hon. P. Bell: When the member was reading out all the various items, I thought, "It's probably time to go and revise the act," because the responsibilities for recreation and heritage have been transferred to other ministries in government. So I appreciate the member flagging that for me. Maybe we'll have a look at that next year.

[1645]

But to answer the member's question fully, when government looked at who should be responsible for worker safety as the primary organization — not that everyone doesn't have a responsibility; everyone does have a responsibility — it was determined that WorkSafe is the primary agency that should have that responsibility. While we act to support all of that work, and we do take the lead in many areas, WorkSafe is the key organization within government for worker safety in all areas, so it was determined that it wouldn't be appropriate to have that inside the act.

B. Routley: Thank you, Minister, for the answer, although I have to say I'm disappointed that, as a follow-up…. Again, in the Auditor General's 2008 report entitled Preventing Fatalities and Serious Injuries in B.C. Forests, progress is needed, he said.

"Safety inspections by Forests and Range on cutblocks are rare, as is monitoring of speed on forest roads. Staffing is inadequate for undertaking broad and repeated intervention work. As well, the ministry's compliance and enforcement staff can only observe violations. They are not empowered to intervene."

So one of my first questions to the minister on that is: has the minister considered empowering the ministry's compliance and enforcement staff with the ability to intervene when they clearly see unsafe acts occurring? Are they empowered to intervene as ministry staff?

Hon. P. Bell: That, the member pointed out, is the 2008 report. In fact, we have in several situations now provided the ability for compliance and enforcement staff to intervene, including BCTS areas. Speeding, clearly, is another area where they have the ability to intervene and issue tickets. So we have actioned that item, and there are several examples of that.

B. Routley: Well, I'd be interested in when that occurred and how many of those incidents have been reported and what were the follow-up actions that were taken as a result of those reports. Could you tell me who they report to as a matter of process, if it's something within the ministry's jurisdiction now? Who would they report to, and what actions are they required to take?

Hon. P. Bell: Depending on the nature of the activity that needs to take place to intercede in something, this can range from something as simple as a compliance and enforcement officer noting a cutblock boundary that maybe shouldn't be where it is and just talking to the operator long before any infraction takes place — when there is the potential for an infraction, working with whoever the operator is to relocate it.

It could be something as simple as that, or it could be something far more complex, where there is a more serious violation. A speeding violation is an example, or if that individual then….

[1650]

Maybe there are other roadside inspection activities that take place at that point. There is a variety of things that could take place. There is an annual report that's issued that provides that level of information, and we'd be happy to provide the member opposite with those reports.

B. Routley: Back in 2007 there was a chief coroner who also talked about logging truck drivers and the issue of road safety and enforcement on forest roads. The minister just talked about speeding. I find that very interesting. I'd like to know if there have been any tickets handed out to speeding vehicles on forest roads by compliance officers. If so, how many tickets were handed out?

The other part of that is in terms of dollars to provide the resources necessary to do this safety work. Could you give us an idea of how much money has been allocated to safety in terms of the budget of compliance and enforcement?

Hon. P. Bell: The member asked a couple of questions there in terms of tickets. The member may recall that we announced that program last year, so last year was the first year that we were actually out actively having our compliance enforcement officers monitoring traffic speeds and issuing tickets.

I don't know the exact number of tickets that were issued. I do know that there were tickets issued because I was hounded by a relentless news reporter by the name of Angelo Iacobucci for that statistic and provided him some numbers for the Kamloops region last year in terms of the level of enforcement.

I do know there were tickets issued. I don't know how many. That report, we're expecting, will be out in the next relatively short while, and that will compile all of the compliance and enforcement actions for 2009-10. Last year was the first year for that.

Now, I'm thinking I missed one of the questions. I'll sit down, and maybe if I did miss it, the member opposite can refresh my memory.

N. Simons: My question is about mud-bogging and enforcement against mud-boggers. I know that in 2007, Bill 18 or 19 or something increased the fines for mud-bogging. I'm just wondering if I could get a list of fines issued, maybe comparative for 2008-2009, just to see specifically if there have been any changes in terms of enforcement. Yeah, that was the question — so thank you, Minister.

[1655]

Hon. P. Bell: Part of this answer will be helpful to the previous member's questions, I think, as well. The Ministry of Forests and Range recently acquired the regulatory authority to actively be engaged in compliance and enforcement activities around mud-bogging, just in the last six or eight months. I don't remember the exact date, but it's in that time range.

Our statistical evidence on year-over-year enforcement would probably not be all that helpful to the member because we've just started doing that work now. It was previously the responsibility of Ministry of Environment.

What I would suggest that the member do is canvass the Minister of Environment for that data. He'd be able to get that data more effectively through the Minister of Environment. I don't think the minister has had his estimates yet, although I'm not positive.

We do now have the authority. We've recently started engaging in that activity, one that we think we're well suited.

For the previous member as well, I should have added probably that the ministry did not have the legislative authority previously or the regulatory authority around speed enforcement. That was something that we took forward last year. That's why last year was the first year that we were actively engaged in enforcement of speeds on resource roads.

Again, year-over-year data on that particular issue may not be all that helpful in that we have just started participating in that at this point.

N. Simons: The press release I just was looking at is from March 2007. It's an announcement from your predecessor saying that changes to the Forest and Range Practices Act will allow for steeper fines, specifically for mud-bogging. It seems to me there's no mention in the press release of the Ministry of Environment whatsoever. It does talk about fines — maximum $100,000. I think they went up from $5,000 or $10,000.

I'm just perplexed a little bit about the response. I'm wondering if that's possibly due to confusion with roles and responsibilities. It's clearly a Ministry of Forests press release about changes to the Forest and Range Practices Act, specifically about mud-bogging.

Maybe to tweak the memory, it also addressed some things to deal with interface fires. It might have been an omnibus Forest Act change, but it specifically talks about Ministry of Forests enforcement.

Hon. P. Bell: Clearly, we're on a different page here. I didn't understand the question in the first place. I'm just going to ask for the member's tolerance, and we'll respond to the question, hopefully, before the day is done here — if not, tomorrow; if not, in writing. I suggest we move on while staff are working through the questions so that we can get the correct answer.

[1700]

B. Routley: First of all, I appreciate that there have been some incremental improvements in safety. From
[ Page 4861 ]
the report of the minister, there's been at least some move in that direction. That's good news. I'm happy to hear there's been some move in that direction.

But I am concerned. Given that there are all of these coroners' reports, Auditor General's reports, etc., that are concerned about safety…. As I said, it's a specific interest of mine, so if it's possible, could the minister…? Because there are some dollars allocated and some efforts made in terms of safety…. I see he's caught that I would be interested in how much was actually spent in terms of safety and compliance, if there's some idea of that.

I think it's important that we don't lose sight of the need to have consistency and continuity amongst all of the ministries. I don't know whether it's this minister's job to ensure that's the case, but certainly you're the Minister of Forests, and it's all these forest activities that we're talking about. Could the minister undertake to talk to WorkSafe and ensure that there is sufficient activity going on?

Could we, for the public, be able to report to them what level of staffing — the number of full-time-equivalents that are actually assigned the role — and the amount of dollars expended to inspection, monitoring, enforcement and compliance activities for safety? That's in this last year, as compared to where we were even in 2005 when we had the 43 fatalities in the forest industry.

I do appreciate that things have been getting better, but there's still…. You know, any fatality is a bad thing. The one thing I know from my years of being involved in safety committees is that as soon as you let your guard down, that's when things start to happen. When there's nobody ensuring that….

You know, anything as simple as wearing your hardhat and your vest to ensuring people are wearing safety belts and following up on all of the safety regulations. If there's nobody beating the drum on the safety message on a regular basis, things start to slip. That really concerns me as an individual, as a father and grandfather, and as a member of the community. And I'm sure that you, as well, are concerned about safety.

I would like the minister to follow up and to ensure that the number of full-time staff assigned, whether it's through the ministry or through WorkSafe…. If I could get some kind of report on how we're doing in terms of the level of…. Even when you look at the level of forest activity…. You know, you pointed out that the amount of activity in the forest is off. I think you said a third or thereabouts. If that's correct, then do we have a third less compliance and safety officers out in the field as compared to when we were at our highest level? I know that in 2005 we had our last banner year in the forest industry.

So just kind of a checkup to make sure we're doing things safely, if that's possible. I understand what I'm asking for is somewhat complex, so I'm not expecting an immediate answer. If you could take the time and effort to get back to me, I know all of the folks in the field that are concerned about safety and health would be interested in your response.

[1705]

Hon. P. Bell: There are four or five different elements that I want to touch on for the member opposite.

The first question he asked — and it was the one that I did miss in my previous response, now that he mentioned it — was about dollars allocated. We can do some work on that area. It's going to be challenging, because virtually everyone in the forest service has some responsibility for safety.

While there are senior managers that have specific responsibilities, particularly inside B.C. Timber Sales, virtually every employee has it built into their job description. It's physically in their job description that they have some level of responsibility at some point or other, depending on the nature of their job, for safety. I think that's important.

The member asked me to talk to WorkSafe and to ensure that they continue to prioritize that. We do that on a regular basis through the Forest Safety Council. The assistant deputy minister responsible for operations, which includes B.C. Timber Sales and WorkSafe, sits on the Forest Safety Council board formally. They're in constant communication and would do that work.

The member opposite referred to the level of activity. I think he asked a more in-depth question, and this will try and get a response for him. The level of activity, as I mentioned, is actually off about 35 or 36 percent, I think. The reduction in staffing in this go-round was 11 percent in C and E. That hopefully will give the member opposite some comfort.

I want to go back to something the member said that I think is particularly important — and very well said. He said that he was involved with different committees over the years on safety and that even when things are going well, you can't let your guard down. You have to be vigilant. You have to maintain a focus on safety, and if you don't, that's when an accident happens.

We very much agree with that philosophy, and that's why I continue to press staff internally on safety issues, why I continue to play an active role on the Forest Safety Council even though I don't technically have a role. I attend meetings both in person and by telephone.

I have a very good relationship with Reynold Hert. In fact, even just on Friday I was in Vernon for the Interior Logging Association annual convention and spent a portion of my time and comment on worker safety. In that particular circumstance, I was congratulating them for the good work they were doing, because it was reflected in the numbers.

I just want to finish off by saying…. The member asked about the level of activity versus the number of
[ Page 4862 ]
accidents. The statistic I provided the member earlier on was specific to that level. It was related directly to the level of activity.

[1710]

It was the number of accidents per 100,000 cubic metres harvested. That number has dropped from about eight-point-something accidents — a little over eight; I don't remember the exact — per 100,000 cubic metres harvested to about four. It is about half, just over a period of three or four years since the Forest Safety Council came into place.

I think it's a positive trend. It is only a trend, and that trend can go the wrong way in a heartbeat if people are not vigilant. That's why we as a Forest Service will continue to prioritize safety for certainly as long as I continue to hold this role.

N. Macdonald: I'm going to come back to the reorganization. I appreciate the minister jumping all over on these issues.

In terms of what we've covered so far, we have the demographic objectives that the ministry had laid out in the past. You know, it doesn't seem that the ministry was able to deal with those sorts of issues with the latest cuts. As well, the ministry in the past — and this goes back to 2008-2009 — just talked within its service plan about the importance of the decentralized organizational structure and how important it was for the ministry to be close to its clients and stakeholders throughout the province. Yet with the cuts, of course, over half of the 204 come from people who were on the ground, so that seems to be problematic.

What I want to turn to now is the stated objectives of the minister and just to see how that has reconciled with the cuts that have been made and perhaps also the lack of enhancement in terms of staffing that you might need to meet the objectives.

I just want to say that with the document, the premise I have with performance measures is that if I would go back to previous years and see the performance measures that you have and the goals, I think the understanding would be that that was an accountability piece for the ministry and for the minister.

It obviously begs the question of why almost all of the performance standards are changed. It probably is not worth taking the time to have that debate, but I just note for the minister that it undermines the stated value of performance standards when you change them from year to year. The goals that the minister talks about haven't changed, so it does sort of raise that concern about their value.

The minister says that of the four objectives that they have, one is improved utilization. Just with that, presumably the minister would be recognizing the incredible amount of good harvestable logs that are left on the forest floor and are not brought into a place where they can be used. I just refer again to a report that Ben Parfitt did. He used forestry info and arrived at a figure of 17.5 cubic metres left on the forest floor in the past five years.

As a starting point of the discussion, is that a figure that sounds right to the minister, or is it a figure that the minister disputes? The figure is 17.5 cubic metres over the past five years.

Hon. P. Bell: I'm tempted just to answer the immediate question that the member asked, and I will, but I want to just touch on one or two other things as well.

Certainly internally, within the ministry, we still prioritize our ability to provide services at the front line and to decentralize decision-making and have front-line decision-makers. Actually, when you do a comparison of job losses in kind of the head office — you know, Victoria, kind of large regional office versus district offices — it is actually weighted as a percentage to the corporate side of the business versus the front-line side of the business, so the reductions are heavier on that side.

The member asked…. Perhaps he didn't ask, but he suggested that the goals stayed the same, but the performance measures changed. I think that's just the reality of us feeling that the performance measures weren't necessarily providing the best measure.

[1715]

One that I'll use as an example for the member opposite is that historically we would measure the number of hectares lost due to fire, beetle — those sorts of things — that hadn't been restocked as a percentage of the total land base. This year we switched the performance measure to the number of cubic metres that we were growing for future harvestable volume.

The reason why that decision was made was that the other model measured…. A hectare was a hectare regardless of where it was. I'm sure the member opposite knows that hectares are not all created equal. There are hectares that are capable of being very, very high-quality growing sites. The member for Stikine has areas in his riding that are very poor-quality growing sites with very limited productivity, and he has sites that are very, very highly productive.

The member for Cariboo North, probably even more so, has sites that are very, very productive and sites that wouldn't grow any more wood than the hair that grows on the member for Cariboo North's head — or mine, for that matter, or the member for Peace River South, for that matter.

The shift in measure is the function of trying to better align our priorities in a way that really reflects the goals. I think people in the member for Cariboo North's riding 15 years from now aren't going to care whether or not every hectare is planted. What they're going to care about is that there are trees to harvest.

Our view of trying to help fill that midterm timber supply — I just wanted to highlight that. I think it's im-
[ Page 4863 ]
portant that the member understands we didn't just kind of willy-nilly go and say: "We're going to cover our butts because we didn't like this or that." It was a function of thinking there was a better way of measuring it.

One thing that I know about the Forest Service and all of government, for that matter, is that they take our measures very seriously. If we provide them with an effective measure, then they will aggressively pursue that measure. So it's important that we set those measures in a way that truly does accomplish the objectives that we're setting. For me, midterm timber supply is a huge one.

That's a long way around to answering a couple of the member's comments. That probably has little or nothing to do with the real question that he asked, which was…. The Ben Parfitt report suggested that over the last five years, I think it was, there was 17.5 million….

Interjection.

Hon. P. Bell: Yeah, I think it was. Anyway, I remember at the time saying that I think there's significant incremental volume left behind on the forest floor. It seems to me I'm on the record saying that I think the Parfitt report might even be light in terms of the recovered volume.

Our focus internally within the ministry is to recover much higher levels of volume. I'm sure we'll have an opportunity to canvass that. I'll just leave it at that point, and then we can continue to discuss it over the next little bit here.

N. Macdonald: In terms of performance measurement, I don't want to spend very much time with it other than to say that I have a different view than the minister. I guess we can leave it at that. I think the performance measures would be more useful if they were year to year. Certainly, the performance measures that are there — I think you could have a discussion as to how useful they are as a measurement. So my conclusion would obviously be the complete opposite of the minister's conclusion.

But the actual thing that interests me most is the utilization issue, so we'll focus on that. I think for the public to understand 17.5 million cubic metres…. As the minister knows and most would know, a cubic metre is the size of a telephone pole. So it is a massive amount of volume. If that was underestimated, as the minister alludes to, then that is a concern. These aren't branches or thin tops. These are actually harvestable logs that companies recognize as such.

[1720]

Now, I think it's fair to say that much of the problem was created by policy decisions in 2003. I presume that the minister is recognizing that…. And I'm not sure if it's the correct term — the take or pay, if that's the term that the minister would be familiar with. That take or pay did create a situation where vast volumes inevitably would be left on the forest floor. Is that something that the minister contests, or is that something that the minister recognizes in hindsight needs to be rectified?

Hon. P. Bell: I would certainly contest some of the member's points. One of the challenges, I think, about the significant increased amount of waste that was left behind up until last year — which, arguably, we've made significant progress on — was simply the very difficult circumstances the industry found itself in and this huge volume of grade 4 logs that were in our forest as a result of mountain pine beetle volumes. Those two circumstances certainly created a significant portion of the volume that was left behind.

But that all said, I've been in this role now for 22 months. One of the very first things I suggested and said was that I wanted to address the challenge of the volume of biomass stuff being left behind in our forests and to start getting additional value out of that. That comes from my personal background as someone that worked in the log-harvesting industry. I always found that to be a personal priority, and I always worked hard to capture as much volume out of any of the stands that I harvested out there. We were pretty successful, arguably, in doing that, and I wanted to try to bring that to the industry and to the portfolio.

My colleague the previous Minister of Forests did introduce some legislation that passed in the 2008 spring session, which allowed us to resell volume that was left behind on the forest floor. We actively participated in that and started to build that business, particularly with bioenergy companies, so there was some headway there.

We also at that point looked at other alternative ways of getting incremental value out of the forest. As a result of all that work, in about October of 2008 we started seeing a real effort on the part of new industries to move in and capture that incremental biomass.

In areas that are reasonably close to bioenergy producers — particularly pellet producers but also producers that can burn incremental hog fuel, and also post-and-rail manufacturers, those sorts of businesses — we saw a very active last 18 or so months for producers going out and capturing that value.

Because we resell it as kind of stand-as-a-whole, it's not necessarily measured in great detail — the amount of volume that's moving. You know, at the end of the day it's 25 cents a cubic metre for most of this material, so it's not something that we're particularly worried about what we get paid for as long as it's reasonably accurate. It's hard for us to know exactly how much moved, but our sense is that there were about three million cubic metres captured in incremental biomass last year, and that number continues to grow actively.
[ Page 4864 ]

Individuals in the member for Cariboo North's riding are utilizing some of that material in the MDF plant and bringing in residual piles and capturing value. In some of the other ridings that I've travelled around, including my own, they're using it for pellets. They're grinding it up in the bush, bringing it in and using it for pellets.

[1725]

In the member from Yale-Lillooet's riding, I think, there's a very aggressive company, Trace Resources, that is doing a lot of work in this area. They're doing everything from selling chips to pulp mills, to selling hog to pulp mills, to selling hog to greenhouse facilities, where they're burning it in their burners.

We introduced a new model of licence through B.C. Timber Sales a little over a year ago called the innovative timber sale licence or ITSLs, where instead of selling a stand of mountain pine beetle dead timber on a per-cubic-metre basis that required scaling and grading and all the efforts around it, we sold it stand-as-a-whole. We said: "Here's the block. Here's the estimated volume. Tell us how much you think it's worth. Here's the upset price." You put in a bonus bid, and then you write a cheque, and you've purchased all of that volume.

That's worked very, very well, and those sites have been particularly clean in terms of the biomass left behind, because the person that purchases it has 100 percent sum cost on the site, and so they're strongly motivated to capture as much value from that as they can. That really has been very helpful in providing fibre to some of the pulp mills like Domtar in Kamloops and Celgar in Castlegar, which were both fibre-starved. Those new ITSL models have worked very, very well.

In the early days of ITSLs, the first few ITSLs, people were uncomfortable. They didn't understand the bidding process. So it was a bit challenging, but once we got into the process, it worked very well. I've already talked about us implementing stand-as-a-whole pricing also with licensee volume, where it sold to licensees in areas, again, where the value of the timber is very consistent. It would be easy to price, largely impacted by mountain pine beetle.

There are a number of initiatives on their way. The member, I think, was briefed in the last few weeks or so on the receiving licence model, and that's another element that we think will really help. I really don't think there's much difference in the way the member, the critic, or I see the desire to try and capture more value.

I see it as a fifth band of timber in terms of an incremental volume of timber coming into the market. I think annually, if we're smart…. It isn't measured in the Parfitt report this way. When I say that I think it's actually more, I'm referring to the way I count it, not the way Mr. Parfitt counts it. The opportunity to capture substantial incremental volumes of tops of branches of all those pieces, I think, can measure ten million metres or more per year.

There's a huge opportunity. We're making good progress in this area. I think that when we look back five years from now, it'll be quite different on the landscape. It will be interesting, because I think there will be an argument some day from people saying that we are removing too much. In fact, I've already had this argument made to me — that we're removing too much coarse woody debris and that the little critters that rely on coarse woody debris for habitat…. The folks that have a better understanding of that would argue that we should leave more behind in the forests.

I actually have heard that submission already from a couple of organizations — that we've got to be careful that we don't go too far in this file. It is definitely a priority area for me, personally, and for us as a forest service, and we're going to continue to drive hard to accomplish that.

N. Macdonald: Just for the context: of course, in the past — and this goes back to 2003 — there was a requirement that essentially there was a first pass. So everything was taken out, and then there would be opportunities for entrepreneurs to come and get elements of the cut that the major licensee or whoever had the block didn't want. That was what was in place.

There was a change that in the end led to tremendous numbers of good, marketable wood left on the forest floor. The minister expresses the obvious public interest and public good in getting better utilization. Now, for me to understand some of the tools that the minister has talked about, it would be nice to have a context in terms of the amount of fuel that was removed either for pellets or for bioenergy.

If the minister could give sort of a percentage or a number compared to a total harvest, that would be useful, if that's something that's easily expressed. I won't hold the minister to an exact number, but just to give a sense. The minister has asserted that there have been improvements and there is success, so maybe some sort of idea of those figures as well.

[1730]

How much has been burnt by licensees on these various sites? What sort of figures are we talking there? From that context, maybe we can continue the discussion.

Hon. P. Bell: There are two things. Just a brief point I wanted to touch on first, and then I'll come back to the real theme of the question.

The member opposite said that in the earlier 2000 period there was a system where a licensee would go harvest the wood. Then someone else could come in and do a second pass and take whatever was…. I'm not sure if that's…. Anyways, I may not have heard that. I may have misunderstood it.

If that technically was possible, it didn't work. It wasn't something that was actively occurring, and that's
[ Page 4865 ]
why the change was made to allow us to sell the wood the second time. I may have misunderstood the point, and I'm happy to come back to that.

[H. Bloy in the chair.]

The member opposite asked me if I could give him a breakout of the percentage of the volume, the three million or so cubic metres that were captured last year, and where that might have gone to. He promised — and it's on the Hansard record, so I'll hold him to the promise — not to hold me to the number, which is a good thing. I'll explain why he couldn't hold me to it anyways. I'll explain that first.

One of the beauties of stand-as-a-whole pricing is that we actually physically sell it to the proponent on the site, on the landing. There are no scaling requirements for that material after that point in time occurs. Where that material goes is not something that we follow at that point.

In a normal sale right now, the harvest billing system tracks where each and every log goes. So we know if it went to a pulp mill, a bioenergy facility, a sawmill, a plywood plant, and we know which plywood plant, which sawmill. So we would know that under the harvest billing system.

Under stand-as-a-whole, because it's paid for at the site, they can manufacture it on site if they choose to. If it's a grinding, they could grind it on site. Technically, if they wanted to saw it, if it was a small sawmill, they could saw it on site. That's something that I know I've heard over my eight or nine years from small-scale salvagers — that they would like to be able to set up a small sawmill in the bush and saw. This model allows them to do that.

We don't track once the wood is paid for. We don't track where the biomass goes to. I'm calling it biomass just because it's a more general term as opposed to, specifically, a saw log, which only represents a small component of the total wood that we're referring to here.

But the member asked, and he promised that he wouldn't hold me to it. My sense is that, probably, something around 50 percent or a little less ends up in chips that go to a pulp mill of some kind. I think they're chipping down to about a two-inch top or so, trying to get some value out of the chips. That was particularly driven because of Domtar and Celgar. Both those mills were challenged by chip supply a couple of years ago. Well, when I first came into the role, they were both challenged.

[1735]

Of the remaining 50 percent, I would suggest it's probably a third that ends up in pellets. A third ends up in hog for the pulp industry that has electrical generating capacity. Some pulp mills, as the member opposite knows, have electrical generating capacity within the mill — most of them do, I guess, and maybe all. I don't know. There may be even a little more than a third in that.

Then the remaining third would go to a variety of sources, everything ranging from animal bedding to greenhouses. Again, I'm going back to trace resources now, but they even do a landscape product with it. They have another fine product that they're looking at doing, kind of a kitty litter thing or something. There are a variety of products.

One of the beauties of this industry right now is that there's this new band of fibre, the fifth band of fibre, that's become available as a result of some of the shifts in model that we have here, which is encouraging a lot of entrepreneuralism and people looking at what they can do with this incremental fibre.

It's one of the very interesting things right now. There are lots of new initiatives coming forward from people trying new product lines to see if they can make a go of it. I think it's a very interesting, exciting time.

N. Macdonald: As I said, the minister asserted that things were improving. We've agreed that there is a tremendous problem historically. What is the number? What is the amount of waste from last year or your most recent year? What is the total?

Hon. P. Bell: I think I understood the minister's question to be: how much improvement have we made year over year? The statistics I have are '08-09 over '07-08. While it is relevant, because it was about half of the year in '08-09 — the changes were in place, and we were starting to capture value — it wasn't a full year of incremental change. I would hope that we'll see a doubling of this reduction.

B.C. Timber Sales saw a reduction. So the volume of waste in B.C. Timber Sales saw a reduction of about 60,000 or so cubic metres, and major licensees' waste volumes were reduced by about 460,000 cubic metres. So between the two, a little over 500,000 or 600,000 cubic metres, which I think is about what I would have…. Just thinking back to that time, it was a slower start. We hadn't made the level of headway that I would think we'd make at this previous year.

Those numbers…. Now looking at them, and I hadn't looked at them through that lens before, but they're probably about right.

N. Macdonald: I apologize. I'm not following this. In terms of the measurement for waste, this is wood that the company has recognized is scalable. I'm going back to Parfitt's figures. They recognize that it's scalable, and they have paid to leave it in the woods.

The process that's in place now is that if the ministry thinks that that's not an accurate figure, then the ministry would send staff out to check that. If the company and the ministry didn't agree, then a contractor would
[ Page 4866 ]
be hired by the company to go in and manage the appeal process. That's what is in place.

[1740]

Now, what the minister describes as improvement using the new method…. I'm not completely sure what the minister is talking about. Are you talking about stands that have used a new system where they're basing it on cruising? Is that what the minister's referring to, or what other measures has the minister taken?

They haven't increased the number of compliance and enforcement. More recently, again, they've cut that, so it's not as if there's more enforcement going on. How does the minister arrive at the figures if you're now talking about cruising as a method? How do you arrive at those numbers?

Hon. P. Bell: The numbers that I just provided the member opposite with are the actual reduction in billed waste, year over year, '08-09 versus '07-08.

N. Macdonald: So the billed waste, then. These are all businesses that are using the old, established model. For his tools for reducing waste — the tool that the minister was using was a new cruising system in sites, I think, particularly in pine beetle areas. The minister was also talking about a system that I don't think is completely in place yet, of tenures that come into an existing tenure and go through and use, presumably, some of the waste that's left behind.

I'm just not clear on how the policy initiatives that the minister is talking about would have any impact on any improvements the minister's talking about, because presumably, he's still talking about wood that has been left behind by the company and that they have paid the stumpage on. Maybe the minister could just explain to me how that works.

Hon. P. Bell: I think I understand what the member is trying to get at. I had walked through a whole bunch of initiatives that the ministry had initiated at varying points in time, including as recently as in the last month or two. Then when the member asked me if I could provide him with some statistics around reduced waste as a result of those actions, I provided him with some data that is older. I think the question was: how can we claim that actions that hadn't taken place yet resulted in a reduction of waste? I didn't intend to do that. If I did, I apologize for that.

The reduction in waste that I referred to…. There were really mainly one primary action, perhaps two, that had taken place and maybe one minor action that had taken place at that point. The first action that had taken place, which was substantial, was the passing of the legislation that allowed for wood to be sold a second time, off the landing — or off the block.

[1745]

That legislation has always been seen as a hammer — not something that we would want to use if we don't have to use it but something that encourages licensees to go out and enter into business-to-business relationships with other individuals to utilize the remainder of the biomass that's left on the site. I'm informed that we've actually never had to issue one of those tenures, that it has met its objective.

Major licensees have voluntarily entered into those relationships. That has allowed us to capture incremental value from those stands. That was probably one of two key elements initially.

The second was, I think, just us establishing it as a priority. Certainly I stood on many stumps — meaning stump speeches, not stumps — saying that this was a personal priority of mine. I'm sure the member would just get bored if I talked about the other three because he's heard them so many times. He knows that I've been, for 22 months, advocating for reducing waste as one of four key areas of focus in the ministry.

You know, I guess it does serve to demonstrate that when a minister talks about a priority, people pay attention and they make a legitimate effort to try and accomplish that objective. So the second area was probably simply us — my talking about it and our focusing on trying to reduce waste.

Through that initial period of time when I took responsibility for the portfolio, I made a significant effort to get in as many of the district offices as I could around the province, and within five, six or seven months I'd been in the vast majority of them and talked to the district staff and managers about these priorities.

Those were probably the two key items that would have impacted the years that I just provided statistics to the member opposite for. Maybe one that isn't as significant but played a role, as well, was the implementation of the innovative timber sale licences — the ITSLs. That was first initiated in the fall of 2008, so some of those ITSLs would have applied statistically to the information that I provided to the member — not a lot. I don't know how many — half a dozen or ten maybe, not a huge number. But there would have been some impact.

The statistics that I provided the member were for '07-08 versus '08-09, not '08-09 versus '09-10, which I think are the statistics that the member is more interested in. We don't have that data yet. That data will come in the coming months, and when it's available, certainly I'm happy to share that with the member opposite. I think that kind of gets at the theme of what the member was looking for.

N. Macdonald: It does. Obviously it is an issue that the minister recognizes the importance of and is working on, and obviously we're going to try to test the minister over time as to how successful this is.
[ Page 4867 ]

I understand the complexity of the issue and the challenges that were there in the past, when licensees were obliged to bring everything to one sort area. I think that ultimately you want that one pass. I think that that's what you want to end up with. It's complex, especially in times when it's economically challenging for companies.

I just want to move on, and I want to pass over the second topic that the minister puts forward as his point just because I don't want to interrupt it. I know we're going to get into a place where we would interrupt.

I just want to spend a couple of minutes on what the minister talks a lot about — the third point, which is the increased exports to China — just again, so that the discussions we have on this are within a context that we both agree on. I was looking at the Canada Wood Group and just looking at the markets that they're talking about.

One of the things, I'll just get the minister to comment on. In the period of time that the minister often refers to, where we've had a dramatic increase in the sales to China, the minister uses the term of about a billion, a gain of about a billion board feet. But when I look at this, I see the Japanese market in the same time has come off a billion board feet. Am I misreading this, or is that something that the minister recognizes as a problem?

[1750]

And then, sort of to save time: what are some of the initiatives that the minister is taking related to the Japanese market? Is it possible for the minister to explain very quickly: why the drop-off? Is there opportunity to expand that market, or are there factors that don't allow that?

Hon. P. Bell: I just asked one of my staff people to print off the statistics. Actually, I have them on my BlackBerry, but we don't seem to have them in paper form here, and reading them on the BlackBerry is very hard. I'm sure it'll be up in five minutes or so, but in the meantime I'll just touch on the member's questions.

I just want to backtrack. The member opposite suggested that he believed that the best way of capturing full biomass is through a single-pass method, and I very much agree with the member. I think it's the most economic way of doing it. I think that'll change the harvesting sector somewhat, but that's okay. It'll create a new opportunity there.

Shifting over to the questions about China versus Japan, I think that, first of all, the sales volumes in calendar year 2008 were about 720 million board feet. In calendar 2009 it was about 1.6 billion board feet — a gain of maybe not quite a billion but about 900 million board feet. In that time, if memory serves me correctly, Japan might have been up just a bit or down just a bit but was basically flat to the previous year.

[1755]

So there was very little of shift of volumes going into Japan during that period of time. Japan did see a tail off — as did the United States, of course — during the initial period of the economic downturn. That appears to have stabilized now.

For the first two months of 2010, I can tell the member, exports to Japan are up 11 percent. Exports to China are up 240 percent. Now, that comes on relatively small numbers for the first two months against calendar 2009, so I'm not expecting us to hold that 240 percent to China for the full year. I don't think that's practical, but it does continue to show an increasing market demand into China.

I think the important thing for the member opposite — and for the audience at home, for that matter…. As Corky used to say, "For all you folks at home…." Actually, the member for Cariboo North likes to use that now as well. The thing that's important to know is it's a completely different product — complementary and not competitive. I think that's a very good-news story and not something that's necessarily been out there all that much.

Japan takes the very best of the best. They are looking for the best possible quality of wood that they can acquire, whether it's through hemlock baby squares or dimensional lumber that is flawless and meets a very, very high standard.

China is more interested in products that traditionally…. Early in the first years of our exports they were interested in the low of the low, the lowest-quality wood that we produce. That is now shifting, and we're seeing that the most rapid growth that is occurring is in the two-and-better phase into China. We're seeing good gains in that market.

But we're not getting any significant…. I shouldn't say any significant benefit. I've seen J grade on the floor of the warehouse in Beijing. There's a little bit that goes in there, but the vast majority of the volume that is going into China and the demand that is occurring is either in the two-and-better or in the low-grades. That makes for a very nice fit for our relationship with Japan.

In speaking to mill owners and managers, what they're finding is that the reduction in Japan, a lot of that was largely reflective of the overall reduction of capacity in the industry. There's only a certain percentage of J that is manufactured on a regular basis. The J that is manufactured is relative to the total production of the industry. It's not like you can ramp up on J grade and not have to ramp up on everything else. If you don't have a home for everything else, the J grade's not profitable.

Having China come on stream and start to add those big additional volumes has allowed the industry to start manufacturing more J grade as well, which has been a positive story.

As luck would have it, instantaneously staff have run downstairs and printed out a wonderful colour copy. So 2008-09…. Now, this is in cubic metres. The conversion
[ Page 4868 ]
from cubic metres of lumber to board feet of lumber is, I think, about 0.61, if memory serves me correct — 0.6 or 0.61. If you take the number of cubic metres, multiply it by 0.6…. The member, being a teacher, I'm sure will be able to just pop that off in his mind in no time.

N. Macdonald: A social studies teacher.

Hon. P. Bell: Even if he was a social studies teacher.

The member actually is closer to being correct than I was. The reduction in Japan from 2008 to 2009 was just over 700,000 cubic metres. Because I actually did study to become a math teacher, I would be pleased to let the member opposite know that that translates into about 420,000 board feet. My math skills are still, I guess, reasonable. So under a half a billion feet.

In the same period of time, China — and as I mentioned, that trend has reversed in 2010 — added about 1.35 million cubic metres, which is about 900 million board feet.

[1800]

I don't think the member should read anything into a reduction in Japan and relate it to China. It's simply a function of total lumber production year over year and the inability to provide that incremental volume.

That is reversing, and we're already seeing growth in the market. In fact, we're about at 2008 levels right now in 2010, for the first two months. We are at 346,000 cubic metres versus 281,000 cubic metres, 2010 over 2009. That's into the Japan market. As I said, with China we're currently at 470,000 cubic metres in 2010 versus 196,000 cubic metres in 2009.

Since I've been rambling, I might as well keep rambling for a second here. The other very interesting statistic, I think, is that as of the end of February, the shipments to…. Even though the U.S. is up by 6 percent over last year right now and, in total, lumber exports we're up 22 percent, one of the interesting statistics is that China now represents 24 percent of the volume that we're putting into the U.S. So almost a quarter of the total lumber going into the U.S. — we're sending that much into China, which I think is a really interesting statistic and showing good growth trends.

N. Macdonald: Okay. I think what the Canada Wood Group does is just over a longer period of time. That may explain some of the differences in terms of how the Japanese market has shrunk. I know that that tends to be high-grade. Now, the concern always with the Chinese market — and it's been expressed many times — is that it's low-grade. Very often, especially out of pine beetle areas, it's sold at a loss. It's still important but not really what you want to build the industry around, nor can you.

What the minister is hoping — and I think British Columbians are hoping — is that they'll move into some of our higher-valued products. To accomplish that, the minister's, and perhaps the federal government's, strategy has been a series of structures. I just would ask the minister to break down the provincial component of the various initiatives.

Here, like you say, you hope that it works, but I know that the minister and the federal government participated with the provincial government on initiatives to highlight the possibility of trusses. There was also a model home that was built, and we're in the midst of having a six-storey or more apartment block — I guess it is — built. Maybe just a total of the investment in trying to showcase some of the products that we have.

Hon. P. Bell: At the risk of starting to ramble again…. A whole bunch of questions there. This all started, really, in 2003 with my predecessor, who is now Attorney General. He initiated a project that I want to call Dream Home Canada. It gets called Dream Home China sometimes and Dream Home Canada sometimes.

This was a project in Shanghai, where we built two villas. The villas were like display homes or show homes out of stick-frame construction. It was a combination of a Chinese-style home with North American construction techniques, I guess would be fair to say.

One of those buildings continues to be used as our office today for FII China and Canada Wood Group. The other one now has a private sector operator who runs, as far as I know, a pub in the other venue.

[1805]

The member asked the question: how do we fund the marketplace? Generally speaking, it goes like this. FII China is 100 percent funded by the province of British Columbia. FII China represents about half of the work that goes on in China. Canada Wood Group China is funded 50 percent by the federal government, 40 percent by the provincial government and 10 percent by industry, and represents about the other half of the business that we do in China.

Each has its own responsibilities in terms of the type of work that it does, whether it be physical marketing of products and construction techniques or quality control or training programs that we do in China for Chinese builders — training people, carpenters, how to work with wood and how to develop wood businesses.

The two entities operate in the same building. They work collaboratively. The total funding envelope in China is about 70 percent B.C., about 20 percent federal government, about 10 percent industry. I might have those numbers out a little bit, but in that range.

The federal government does come to the table significantly on demonstration projects as well. They've worked with us on things like the reconstruction in the Wenchuan earthquake zone. They've contributed to those projects where we've built a school. We're in the process of building a retirement centre and a senior centre to demonstrate seismically stable construction techniques.
[ Page 4869 ]

But I'll go over just for a moment to the truss system that the member referred to. I know that there was an article in the media a few weeks ago about the six-storey walk-up building. The columnist that wrote the article didn't seem to think that there would be much value out of it. I want to demonstrate that I believe that's incorrect, through the analysis of the wood roof truss system.

Our head of FII China, as he was driving around Shanghai, noticed the reconstruction of roofs on six-storey walk-up apartment buildings, and they were doing it out of a relatively lightweight angle iron. They had hauled this angle iron up onto the roof, and they had cut it and welded it in place, and they'd put kind of a composite material on for roofing.

These buildings were built anywhere in the 1960s, '70s, '80s, '90s, and they're building them now. All flat roof, not built very well, so all leaky roofs. So they were looking for re-roofing and beautification, different ways of creating a more interesting-looking building that was functional and that would give additional life to these six-storey buildings.

So this fellow who works for us in China — Mike Hogan is his name — thought that there was a good opportunity for us to try and compete for that market with wood truss systems instead of the steel truss systems that they were building in place.

He talked to the Shanghai government and said: "I think there's a better way of doing this. We'd like to work with you on it. We're prepared to fund five replacement roofs. We'll build five replacement roofs for this at our cost. We'll show you how it works. If it works and if you're comfortable with it, then we hope that you take that and start re-roofing more projects with the wood roof truss system."

That was about 18 months ago that we initiated that. Today I'm told that there are about 7,500 Chinese households under wood roof truss systems, with us picking up those initial five projects.

What's interesting to me is that oftentimes now when I'm in China, I find that there are wood roof truss systems going up in places we had no idea they were going up anymore. The Chinese people have picked this up as a construction technique, and it's harder to actually find steel trusses anymore. Wood has really taken over that marketplace.

I think that it's a good demonstration of working with the Chinese to show them the viability of a product and how it can work. It's got to be efficient. You've got to be cost-effective. They are environmentally concerned. They want a better product. They want something that produces, that's easy to handle and that's quick to work with. So I think it's a real success story there.

I talked about the model home that the member asked about and the six-storey structure the member asked about. We're currently trying to conclude negotiations with the Ministry of Housing and Urban-Rural Development right now. I think we're down to one primary location for this. It will be a three-way partnership between a private sector developer in China — a Chinese private sector developer — the province of British Columbia and the federal government.

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The intent, the location that we're looking at, is in Beijing. It's in an area that is kind of an arts area. It's very similar to Granville Island in Vancouver, that type of area, so it's a great site for this particular type of building. We think it's really applicable and that it'll attract a lot of attention.

The intent would be to build the building, use it as a demonstration site for a period of time and then either perhaps use some of the space for our offices that we have in China right now or simply sell the units and recover as much of the cost as we can. Of course, it's a three-way partnership, so it would be divided up a number of different ways.

I don't expect that we'll have a groundbreaking in the next week or two, but we're working. That's really where we think the next major breakthrough is.

Just to put perspective on it for the audience at home and the member opposite, in China they're building about ten million new homes per year right now. In the U.S. a big year is two million homes. The average housing start in China is about 1,000 square feet. In the U.S. of course, it's larger than that, perhaps a couple of thousand square feet. So the homes are a bit smaller, but they're still substantial. Ten million homes versus what the U. S. will actually build this year, which is about half a million homes, is a huge number.

Of the ten million housing starts that they do in China each year, between six million and seven million are six-storey walk-up apartments — the type of building that we're actively promoting here and looking to develop. This really is a huge opportunity. I was once told that if you built the top two storeys on half of these apartment buildings out of wood, it would consume 25 billion board feet per year. The biggest year we've ever had is 15 billion board feet.

It's a really unique opportunity and something that I know the member opposite supports. I think this is kind of one of those areas where we just all want to make it work. It's a great initiative.

N. Macdonald: A question about the cost: what is the total cost? I think you gave me a percentage. Maybe I didn't hear it. What is the total investment from the province on these marketing initiatives? And it could be ballpark, by the way.

Hon. P. Bell: In 2010-11 total expenditures in China will be $13.3 million. The province's contribution to that is $8.3 million, NRCan is $4.7 million, and the remainder comes from the industry.
[ Page 4870 ]

S. Fraser: Thanks to the minister and staff for being here. I have two issues. I have very little time, so I wrote them down. I'll go with the first one and one of my favourite topics: the Martin Mars water bombers that are run by Coulson Group.

The director of fire management for the province — that's Brian Simpson, of course — made a presentation at a firefighting conference in March and talked about the B.C. Forest Service operations, resources and strategic goals. He spoke of the $397 million spent in 2009 on fire suppression, when the ministry budget for the operations was budgeted at $58 million, maybe, and direct fire was $56 million. So that's an overrun of $285 million or so, by my calculations.

As the minister has identified in the media, the 2009 weather conditions were extreme for fire danger. I am a fan of the Farmers' Almanac. I think that we'll see that again this year.

I have a contractor performance report from the U.S. Department of Agriculture on the Martin Mars water bombers. I have made a copy for the minister. If he's interested, I can get that to him. This is from the U.S. Department of Agriculture. They're reporting on the Martin Mars and the fire intelligence helicopter, the S-76 Firewatch, which was contracted by the Coulson Group to the U.S. Forest Service for the 2009 California fire season.

Now, in the report the USFS states that "the Coulson Group's commitment to excellence and their ability to make cost control one of their company standards makes this a world-class operation." The report noted that "both product and service delivered by Coulson Group was outstanding."

During the presentation Mr. Simpson identified the B.C. Forest Service shift from protecting forest values to protecting communities and noted that there were 685,000 hectares — I found that a scary number — of high-danger fire areas around B.C. communities.

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The question around that is: based on the fact that the B.C. Forest Service has identified 685,000 hectares of high-danger fire areas around B.C. communities; and the Martin Mars and S-76 Firewatch program is considered a world-class operation; and the Martin Mars is the only air tanker — the only one — approved to protect structures, why have the Martin Mars and the fire intelligence helicopter S-76 Firewatch not yet been secured by our government for the upcoming fire season?

Hon. P. Bell: I know there's one more question, so I'll just try and be really quick on this one, and I'm happy to provide more information. I can tell the member opposite that they had a protection branch. Mr. Simpson is actually meeting with Mr. Coulson on Thursday this week to further explore the opportunities around Martin Mars, and we've done extensive work on it already, but I just need to be really cautious.

Although the Martin Mars is a great piece of equipment — I'm not denying that, and Mr. Coulson spent a significant amount of money upgrading it, and there are interesting applications for it — it is not necessarily the plane to use in every application.

Just like for any given particular circumstance, you want the appropriate tool, Martin Mars absolutely has a role, but there are other tools that are more effective and particularly in interface zones. Interface zones are one of the more challenging things. So I think I'll just leave it at that, because I think that answers the basic part of the question.

S. Fraser: This is my last, and I'll just get this on the record, then, too, if that's all right with you, hon. Speaker.

Thanks for the answer to that, Minister. I would like a follow-up on that, because I understand various uses, but this is a great arrow to have in the quiver.

The second question. Again, switching to one of my other favourite subjects, Voith and their new technology, the hybrid technology for the paper industry. My understanding is that the technology is still available. I know in the last estimates we probed this, and the minister said that there was constant contact with Germany.

From the people I've talked to, I have not been made aware of any contact from the minister and ministry that's led to any significant developments with that. Considering that FPInnovations already did the work on this — so the minister knows this technology has great potential to make us the world leader again — I'd like to know what the progress is, who the minister has talked to and if we're going to lose this opportunity, or if we're going to maybe get a shot at getting it?

Hon. P. Bell: First of all, I need to tell the member opposite that there's been no interest expressed by Catalyst or any other private sector partner in the Voith technology since we last met. While we have had contact from Voith, expressing an interest in selling their technology to B.C., a key element would be to have a pulp mill that had done their due diligence that was interested in partnering on that, and we've not had that.

So at this point, if there's a barrier in terms of the development of the Voith technology — and clearly, we're not in a position to make those decisions — we'd need to have a private sector partner, but funding is still available. We haven't had a private sector partner, but that would be the key element.

With that, I would ask that we rise, report substantial progress and ask leave to sit for a little while again.

Motion approved.

The committee rose at 6:19 p.m.

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