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)

Tuesday, April 27, 2010

Morning Sitting

Volume 16, Number 1

[ Page 4871 ]

TUESDAY, APRIL 27, 2010

The House met at 10:03 a.m.

[Mr. Speaker in the chair.]

Prayers.

Introductions by Members

Hon. M. de Jong: I am pleased to introduce to all members of the House today a number of individuals who have travelled here from across British Columbia. In fact, some have travelled from across Canada. They have all dedicated themselves to the cause of improving road safety, and they are the following individuals.

Andy Murie is the CEO of MADD Canada. Laurel and Michael Middelaer are the parents of 4-year-old Alexa, who died tragically in a motor vehicle on a roadside just a couple of years ago. Denise Lodge is the mother of 21-year-old Corey Lodge, who died in a motorcycle accident just a day after purchasing his bike, and she is joined by Corey's grandmother, Sylvia Spoor. Insp. Mike Diack is from RCMP E division traffic services. Dr. Roy Purssell is head of emergency medicine at Vancouver General Hospital and serves on the board of MADD Canada.

[1005]

A number of municipal and RCMP officers join us from Victoria, Saanich, Oak Bay and Vancouver: Allan Lamb, BCAA's Traffic Safety Foundation head; Trace Acres from BCAA; Serge Corbeil from the Insurance Bureau of Canada; and Kathy Thomson from ICBC.

They are here in anticipation of legislation that will be presented to the House momentarily. I'd like to thank them for their commitment and their passion for the cause of road safety, sometimes in the aftermath of very tragic circumstances, and ask all members of the House to make all of these people feel very welcome today.

Introduction and
First Reading of Bills

Bill 14 — Motor vehicle
amendment act, 2010

Hon. M. de Jong presented a message from His Honour the Lieutenant-Governor: a bill intituled Motor Vehicle Amendment Act, 2010.

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

Motion approved.

Hon. M. de Jong: Bill 14 fulfils a throne speech commitment to introduce significant changes to reduce impaired driving and dangerous driving and improve public safety on our highways.

The amendments will address impaired driving by focusing on intervention and deterrence. They will also increase road safety for motorcyclists and drivers. Amendments will also improve the existing vehicle impoundment regime and driver fitness programs and will also allow seasonal agricultural workers to drive on the basis of their home licence for the duration of their work term.

Of late we are sadly seeing an escalation in incidents of impaired driving and all of the resulting tragedy that flows from that. The amendments to impaired driving provisions will give police more tools at the roadside to remove impaired and dangerous drivers from the road as a means of reducing the body count on B.C.'s highways.

Impaired drivers will face new, escalating administrative penalties and vehicle impoundment periods and will be required to attend provincial remedial programs. In short, if you drink and drive, you will lose your licence. You will lose your vehicle, and you will lose a lot of money.

The amendments to motorcycle provisions will improve road safety for motorcyclists in B.C. by requiring motorcycle helmets that meet recognized safety standards, protecting passenger safety and restricting the power of a motorcycle that an inexperienced rider may ride during the learner period.

These amendments will also provide new mandatory and discretionary reporting provisions for key health professionals, which will support B.C.'s approach to assessing medical fitness to drive. It will also eliminate an outdated provision that allows drivers to be exempt from wearing seatbelts due to medical reasons.

Finally, the amendments address a concern by the B.C. agricultural sector relating to visiting farmworkers.

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

Bill 14, Motor Vehicle 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.

Orders of the Day

Hon. M. de Jong: I call, in Committee A, Committee of Supply — for the information of members, the ongoing estimates of the Ministry of Forests and Range — and, in this chamber, continued second reading debate on Bill 9.
[ Page 4872 ]

Second Reading of Bills

Bill 9 — consumption tax rebate
and transition act

(continued)

On the amendment (continued).

G. Coons: I take my place to support the motion that's on the floor today. For those in the gallery, the motion is: "Be it resolved that Bill 9 not be read a second time now but 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."

[C. Trevena in the chair.]

What's so important about the motion before us is, especially after yesterday…. At this time yesterday, this motion would be continuing for the rest of the week with full debate, full obligations of the government to understand what's going on with the HST bill.

[1010]

But what has happened…. At the end of the day yesterday there was a closure motion, a procedure motion that forces an end to debate, a ramming through of this unpopular policy, this HST bill, without proper consideration.

That's why this motion today is so valuable for members in this House to support, especially when the members are on their way home in a few days, especially to those ridings — Cariboo-Chilcotin, Parksville-Qualicum, Peace River North, Shuswap, Fort Langley–Aldergrove, Langley, Abbotsford South, Chilliwack-Hope — where, as far as a petition going out there, those numbers have already exceeded the number. It's important that those members stand up in this House today and support this motion before us as they go back to their constituents and represent them.

Eighty-two percent of British Columbians are opposed to this HST. In Kamloops–North Thompson and Nanaimo there are over 300 signatures already gotten through this petition that's going throughout the province. I think it's incumbent upon all members in the House to respect their constituents and vote for this referral motion.

This motion is before us because this government, the Liberal government, failed to do their due diligence with the decision to adopt the HST. No cost-benefit analysis needs were done — no comprehensive cost-benefit analysis and no follow-up studies. British Columbians expect and deserve more from their elected officials.

Now, there are many groups that need to come and appear before the Select Standing Committee on Finance and Government Services. First Nations in the province are opposed. Seniors are opposed to the HST. Sports organizations, the real estate industry, restaurant industry and food services, small coffee shops throughout the province, tourism associations, municipal governments, condo owners, airlines, seaplane businesses, funeral directors, cycle shops, small business owners, individuals, chambers of commerce.

I'd like to look at why we need to support this referral so some of these witnesses can come and put forth their arguments why this government needs a second, reflective thought on implementing the HST. We look at some chambers.

In Prince Rupert, Deb Stava, the president of the Prince Rupert Chamber of Commerce, says the tax "certainly will have a negative impact on some of the business sectors," and: "We will continue to lobby the government to expand on the exemptions to try to ease the burden." People like Deb Stava and other chambers need the opportunity to come to a standing committee to put forth their arguments on why this government needs to have a second, reflective thought. That's what this motion before us does.

Enderby: "There are no new announcements of the mitigation of HST, and the Greater Vernon Chamber of Commerce would prefer to have seen a funding program that assisted businesses." Saltspring chamber — John Cade: "Many details around HST have yet to be clearly outlined by the government." They haven't been informed of exactly how it will work.

In Victoria the Victoria chamber had specific concerns about mitigation of the tourism industry and B.C. Ferries, whose costs with the HST is going to increase by $6 million a year. They had many concerns and presented to the Finance Standing Committee in October 2009. They believe — as well as many other chambers — that there must be an opportunity for them to present their arguments.

The Kelowna Chamber of Commerce. Basically, in their survey…. Many of the respondents to their survey urged the provincial government not to implement tax harmonization. The predominant response to the question urged the Kelowna chamber to oppose the implementation of the tax harmonization.

[1015]

Even though we have the B.C. Chamber of Commerce going out there saying "We're in full support," there are many — dozens of chambers — throughout the province that need the opportunity to present to the select standing committee as this motion before us allows them.

We look at the Fort St. John chamber. They are putting forth to the B.C. chamber AGM this May. As of March 29, 2010, the Fort St. John chamber says that the government needs to host more public consultations before implementing changes — more public consultations. That's what this referral motion does. It gives that opportunity for more consultations so we get some answers from this
[ Page 4873 ]
government, who did not do their due diligence as far as forcing this HST upon British Columbians.

The North Van Chamber of Commerce. Nearly 80 percent of the members of the North Vancouver Chamber of Commerce who responded in a survey oppose the HST. "Overall," says Anne McMullin, the new president, "the North Van chamber has been supportive, but we certainly have heard from the membership it's not in support. There are a lot of unanswered questions. What's the impact going to be on my business? What will any mitigation strategies be? How much is it going to cost me as a business?"

This referral motion will answer those questions for the North Van chamber. It's interesting that the MLA for North Vancouver–Lonsdale says about her own chamber: "I don't think they get it." And I think they do get it. What we need is support from all MLAs in this House on this referral motion so that there is that opportunity.

The North Vancouver–Lonsdale MLA blames the media for spreading mistruths about the tax plan — the media. You know, here it is. We've been hearing it's Vander Zalm spreading mistruths or it's the opposition spreading mistruths about the HST. But the member for North Vancouver–Lonsdale blames the media. So we need to get down to the real truth about what's going on with this HST, and this referral motion puts us in the right direction.

Now, I just want to, for those in the gallery today, look at the motion that's before us and look at what a select standing committee is. It's one of the nine parliamentary committees or select standing committees appointed by the Legislative Assembly to do business on behalf of British Columbians. They derive their powers from this House, and they report their findings back.

The referral motion before us today will open up the door for consultation, for detailed examination of matters about the HST. It allows members of the public to have direct input and put in submissions, and the parliamentary committees may travel to obtain evidence.

Some of the select standing committees that are out there right now: Aboriginal Affairs; Children and Youth; Crown Corporations; Education; Health; Legislative Initiatives; Parliamentary Reform, Ethical Conduct; Public Accounts; and the Select Standing Committee on Finance and Government Services. The motion before us wants to open up the discussion, wants to open up the detailed examination so British Columbians and organizations have input into what this government is doing with the HST.

Now, over the last couple of days, especially last night, many e-mails have been sent to me about the HST and about the closure motion for debate and how it's an assault on openness, on transparency, on accountability. The e-mails I'm getting are concerned about the anti-democratic and unparliamentary measure of the closure motion that was presented in this House yesterday by the B.C. Liberal government.

This motion before us, this referral motion, is an out. It's an out for the government. They can vote for this referral motion and get that monkey off their back, that monkey that gets rid of that heinous motion that this government put before us yesterday.

One of my constituents sent me a quote from a very famous person that reminded her of what is happening in the Legislature with that closure motion that, if we do not vote for the referral motion, could be an attack on political democracy.

[1020]

I will read that, put this on record. "Once more let me remind you what fascism is. It need not wear a brown shirt or green shirt. It may not even wear a dress shirt. It begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege."

That was Tommy Douglas, the greatest Canadian of all time, who warned Canadians about situations that we're encountering in this Legislature, about the attack that's destroying political democracy.

As we move forward, 82 percent of British Columbians opposing this HST, members on the other side see their constituents line up in opposition to their beliefs. You would think that they would have a reflective second thought about this imposition of an HST that is going to be horrendous to British Columbians over the short term. The opportunity is this referral motion before us.

Look at some of the First Nations and aboriginal groups throughout the province who want reflective debate, who want to have input into what's going to happen. The Union of B.C. Indian Chiefs has sent out e-mails to every MLA to vote against the HST. They are imploring MLAs in this House to sit back — and this is their opportunity — and to support the referral motion before us.

They oppose the implementation of the HST. It's a regressive tax that will increase the financial burden of First Nations families who are living in poverty, including the working poor. They indicate they understand there's 82 percent opposition to the HST in this province. They get it. British Columbians get it. But this government on the other side does not get it, and that's shameful.

The Union of B.C. Indian Chiefs says that the proposed HST is of great importance because there's a high proportionate level of poverty among them. They've said they've repeatedly contacted both the provincial Ministers of Finance to address the impacts and lack of any consultation process. They've even encouraged their members to take a stance against the HST and to sign up as canvassers in this petition that's going around. Unheard of for First Nations to take that stance.

What Chief Stewart Phillip, who is head of the B.C. Union of Indian Chiefs, said is that they have been trying to engage both the province and the federal government through their Finance Ministers to talk about
[ Page 4874 ]
the impacts, but they've been rebuffed from both the federal government and from this Finance Minister for the B.C. Liberals.

They've written to them. The federal Finance Minister, Jim Flaherty, dismissed their request and urged Mr. Phillip to take the matter up with the B.C. Liberal Finance Minister, who sent a one-paragraph note telling him to go back to Mr. Flaherty. You can understand how this dismissive response just highlights the breakdown of the so-called new relationship between the B.C. Liberal government and B.C.'s native leadership.

This motion before us, this referral to a select standing committee, could be the out for the government and for those MLAs from those ridings where they have to go back and face their constituents, the 82 percent of those in British Columbia that oppose what they are doing.

[1025]

Another group who are concerned about the HST are seniors. You know, the seniors have been decimated by this government over the last eight or nine years, and again, they need the opportunity to come to the select standing committee and put on the table what their concerns are. But more importantly, this government needs to put on the table what the HST actually means to British Columbians. During the election they said it wasn't on their radar, and three days after, they're going back and forth figuring out the ins and outs of it — a total deception. It was an election by deception by this government.

Sylvia MacLeay, the president of the Council of Senior Citizens Organizations, COSCO, says: "I'm very disappointed…. Just three months after he promised he wouldn't do it. Many seniors worked for years, saved for their retirement, lost thousands of dollars in the market downturn. They're stretched to the limit. They don't have any money to spare." And the Premier will even take more money out of their pockets.

In their seniors report: "The HST will raise the cost of any taxed item at 12 percent. This will hurt seniors…. Everyone needs staple items…toothpaste, toilet paper, while the rich will scarcely notice the tax…. It won't be easy, but the future cannot be controlled by the interests of the small but hugely wealthy minority."

It's time for seniors to speak out on the HST, and they deserve the opportunity to come to a select standing committee and voice their concerns to this government, who, to this point, has failed to listen.

In the latest COSCO News, the Council of Senior Citizens Organizations of B.C., they acknowledge B.C. is the greatest place on earth. But why, they say, are people, especially the most vulnerable — like seniors — being treated so badly? Meanwhile, large corporations are granted tax breaks.

The Coalition to Build a Better B.C. is from all around British Columbia. They are going to wear signs and wear buttons, these seniors, that say "Down with the HST."

There was a survey done through the B.C. Retired Teachers Association. More than 600 people calculated in 21 expenditure categories that it's going to cost over $800 per senior. That's shameful. This motion before us will allow these seniors to come and put forth a case so that the standing committee can listen to their concerns.

But more importantly, it's what's going to happen not only to seniors but to all British Columbians who are trying to save for retirement. The investment counsellors — the Investment Counsel Association of Canada warned that the harmonized sales tax in British Columbia is going to raise the cost of investment counselling fees from 5 to 12 percent. They need that opportunity to put forth their case. This motion before us opens the door for the Liberal MLAs on that side of the House to sit back and say: "Perhaps this is a good referral motion, and we should move forward."

The looming HST will affect nest eggs. It will make it tougher for pensioners, mutual fund buyers and those using investment counsellors to properly save for retirement. There's an uneven playing field when it comes to the GST, and soon the HST, to financial services. This is from the Investment Counsel Association of Canada, and it's going to cost more and more and more.

Bob Hill of Coleford Investment Management said — and he's the Investment Counsel Association's chairperson — "These are complex issues, with financial products and services being offered across Canada in different provinces…. Ultimately, we believe now is not the time to introduce an additional tax on Canada's pensions and retirement savings." They're urging the government to seek further consultation on the impact of the HST before moving forward.

[1030]

That's what this motion before us does. When this government looked at the HST, there was no input, no consultation, no assessments, no credible reports, no reviews, no analysis, no comprehensive cost-benefit analysis, no impact studies as far as how it's going to impact on tourism or the restaurant sector or British Columbians in general. No facts, no openness, no honest debate. This motion could give the opportunity not only for the MLAs on the government side but for British Columbians to have that honest debate, to have some openness, to have the facts put on the table.

Now, when we look at other areas that are being impacted, we look at kids' programs — whether it's arts, culture programs, sports, hockey — and we've seen and heard the concerns of the impacts of the HST. In Prince Rupert their ice time will now be 7 percent more, and hockey organizations across British Columbia will pay more for their ice rentals along with facility rentals for swimming or figure skating, basketball, dance, soccer, karate, judo, boxing. All of these are going up with the implementation of the HST, an attack not only on sports programs but on the ability for parents to put their kids into these programs.
[ Page 4875 ]

We look at some of the concerns — Andrew Mustard from the Pacific Coast Amateur Hockey Association: "The cities will be charging 12 percent instead of 5 percent on the rink time and hockey equipment, and it will be a higher cost. Parents will see ultimately that that cost gets passed back onto them." There'll be some parents who just don't put their kid in hockey.

When we see this in smaller communities where one of the key components of rural British Columbia is involvement in activities, whether it's sports or recreation or cultural activities, this will put a huge expense on the backs of parents and possibly eliminate kids' participation.

Now, Rick Stewart of the Abbotsford Minor Hockey Association: "I've got the weight of the world on my shoulders right now…. How many kids is this HST going to push out of our association? It's going to affect some families to the point where they're no longer able to afford hockey."

You know, this side believes and I truthfully believe that many British Columbians would agree with this motion to refer to a select standing committee so that we could have people present, so that we could have the facts put on the table. I referred to this bill before us as a truth-or-consequences bill when I spoke to it previously, and I think that this motion, this referral motion is the truth part of the truth-or-consequences bill.

The truth will come out. The truth will set us free. Hopefully that's what the Liberal MLAs are thinking on that side. When you have the presentations come before those members that are on the Select Standing Committee on Finance, they will finally hear the truth of it.

If this motion doesn't pass, and if today at the end of the day we see the hands go up in opposition to this referral motion, that's the consequences part of the truth-or-consequences bill, and the consequences, I think, will be significant for this government.

You know, it reminds me of an old '50s show, To Tell the Truth, and I think this referral motion is basically similar to that show, where you could have the people stand up and say, "I am the Finance Minister," and somebody else stand up and say, "No, I'm the Finance Minister" — I'm sure people in here remember that show — and somebody else stand up and say: "No, I'm the Finance Minister." What this referral motion would be would be to try to figure out who the real Finance Minister is, you know.

[1035]

They would stand up. All three or four contestants would stand up and say: "I'm the Finance Minister who never told voters before the 2009 election that we would bring in this HST and transfer $2 billion a year from big business to the backs of consumers." "And I'm the Finance Minister who told the restaurant and development industry in writing: 'We are not going to introduce the HST.'" "I'm the Finance Minister that claimed we had a $495 million deficit before the election, but then a few short weeks after, it was $2.8 billion." "I'm the Finance Minister that said that we weren't going to consider the HST before the election." But according to documents through freedom of information, three days after the election the calls were going to the federal government about the HST.

Again, when we have this referral motion, we can have some of those questions answered. British Columbians can ask questions. There can be reflective thought and debate about this.

Getting back to To Tell the Truth, then, all of a sudden, the panel tries to figure out which one is the real Finance Minister. They try to pick them, and then the other people introduce themselves. I can see the other people that might be in the lineup with the Finance Minister. There's probably Brian Mulroney, George Bush, you know, the Nixons of the world and then our Finance Minister.

This motion to refer will put the truth on the table, will set the record straight. Perhaps British Columbians would ask the select standing committee to maybe put out a comprehensive list of those items that are going to be taxed. On the government website they have a comprehensive list of four items that are going to be taxed.

If you want to look at sort of misleading the public — whether the B.C. Liberal MLAs believe that it's Bill Vander Zalm and his initiative misleading British Columbians or whether it's this side of the House misleading British Columbians or whether it's the media misleading British Columbians — British Columbians know who is misleading British Columbians, and it's this B.C. Liberal government that's misleading them.

Now, we met with the B.C. Real Estate Association, all of us, and they are opposed. They are another group that needs to respond to the select standing committee.

We look at all the groups and all of the mistruths, the misinformation coming from this B.C. Liberal government, and it reminds me of another sitcom, the I Love Lucy show. I Love Lucy, yes, and Ricky Ricardo had that famous line. He says: "Lucy, you got some 'splainin' to do." I believe that British Columbians expect this government to do some explaining, to be straightforward and to be honest about what they're doing. This motion before us will do that.

Hon. J. Yap: I'm honoured to take my place once again in this debate on Bill 9 or, actually, the amendment that's been proposed relative to Bill 9.

To start off, as I have in the past, always listening intently to the comments of the previous speaker on behalf of the opposition, I'd like to address a couple of points that the member for North Coast raised in his comments which he just concluded.

First of all, the member for North Coast talked about the fact that there's some ramming through going on here, when, in fact, Madam Speaker, as you know, as all
[ Page 4876 ]
members of the House know, we have been debating Bill 9 for pretty much all of the month of April. We have also been debating, in some form or other, or canvassing the harmonized sales tax basically this entire session.

It is disingenuous for the member for North Coast to say that there's not been enough time to canvass and debate the harmonized sales tax, in particular with respect to Bill 9.

[1040]

He also talks about lack of due diligence and no follow-up studies. The harmonized sales tax has been a topic of discussion and review and analysis for many, many years. In fact, the member well knows that the Finance and Government Services Committee, a bipartisan committee of both sides of the House, has recommended for some years that we look at harmonization because of the benefits of harmonization. So that's another comment that I wanted to set the record straight on, on the record.

Later on in his comments he talks about the impact on British Columbians who have lower income. Of course, he conveniently forgets to talk about how, under the proposed HST, there will be a tax credit to support low-income families and seniors — didn't hear anything about that. Low-income families and individuals will receive an annual B.C. HST credit of $230 for individuals with income up to $20,000 and $230 per family member for families with incomes up to $25,000, paid quarterly with the GST credit.

This will benefit 1.1 million British Columbians. I didn't hear that from the member opposite. But the HST, which will be in effect July 1 with some transition situations being in effect starting May 1, will ensure that vulnerable and low-income British Columbians are looked after.

The member also makes a comment that other members of the opposition during this debate repeat over and over again and that I feel I need to address. That is the transfer of $2 billion from big business to consumers. What we're talking about here is recognizing that the tax that we have, the PST — the old, antiquated provincial sales tax — already was reflected in the costs of products that British Columbians need and consume. It's the concept of embedded tax.

Embedded tax may sound like a technical term, but what it really refers to is the fact that when businesses — small, medium, and large businesses — incur costs, including PST, it's included in their costs, and businesses naturally will recognize that cost in their pricing. The fact is that embedded, included or however you want to call it, PST has been part of what consumers in British Columbia have been paying as consumers.

What this tax will do, what the HST will do as a value-added tax is recognize the fact that consumers will be paying the tax and provide the efficiency and the incentive for productivity and the increased competitiveness that we need to increase the investment, the job creation and the growth in our economy that all British Columbians seek for a great future.

Just a few thoughts relative to the comments by the previous speaker, the member for North Coast, and I will get back to a few other points that he had raised. For the benefit of those British Columbians who are following on Hansard, who are following the debate, it's worthwhile to recap where we are.

First of all, the harmonized sales tax is in place. I just wanted to get that out there because, listening to members of the opposition, they're trying to spin the debate to suggest that the harmonized sales tax is not in place. It is in place. It has been. The legislation enabling the combination of British Columbia's provincial sales tax with the GST to create the harmonized sales tax has been passed in the federal parliament, in the Parliament of Canada, and is in effect.

What we're talking about here, Madam Speaker, as you know, is Bill 9, which will allow British Columbia to, first of all, set aside the provincial sales tax and to put in place the transition to the harmonized sales tax.

[1045]

If we don't get on with the job of passing this legislation and setting aside the provincial sales tax and putting in place the transition rules — which really kick in May 1, in a few days — it would be an untenable situation. That is why, as many of my colleagues have expressed so eloquently these past few days, I cannot support this amendment and will spend the next few moments reinforcing why I don't support it.

It is, to be blunt, a tactic that the opposition are using to try to delay the passage of this legislation when, in fact, the legislation which we are all talking about — the harmonized sales tax — is in place, and Bill 9 is meant to ensure that we don't get double-taxed.

What do I mean by double-taxed? I mean that if we don't pass this legislation, if we don't pass Bill 9…. I know that the members of the opposition are doing everything they can to frustrate our legislative duty here to pass this legislation, because we've spent a lot of time canvassing the issue. We've spent a lot of time talking about the benefits of harmonized sales tax. But effectively, what will happen if we do not pass Bill 9 is that there will be double taxation.

Are the members of the opposition suggesting that we want to double-tax British Columbians to the extent of 19 percent, which is 12 percent plus the 7 percent PST? Is that what they're suggesting? That is simply untenable, and I just wanted to put that out there.

The harmonized sales tax will ensure that British Columbia becomes even more competitive. Since 2001 this government has made over 100 income tax, corporate income tax, small business tax and all kinds of tax reductions to make British Columbia one of the most competitive jurisdictions, most competitive tax structure
[ Page 4877 ]
economies, in North America. Going to a value-added tax will simply recognize that this is the most important thing we can do, quite frankly, to make our already competitive economy even more competitive.

Why do we say that? Well, more than 130 countries have some form of value-added tax, some form of HST, including — and this is an important statistic — 29 out of 30 OECD countries. These are the modern industrialized countries of which Canada, and British Columbia as a part of Canada, is a part of.

When we see that the majority of Canadian provinces are moving to HST, including Ontario, this is the right thing to do. We have heard of the benefits. I think it's worth canvassing again some of the benefits, which I've talked about and which the members of the opposition conveniently forget to talk about. It's important that we do that.

According to pretty much every credible and reputable economist and business leader in the country, this is the right thing to do because of the investment it'll attract, because of the jobs that will be created. So let's put some numbers to it.

Reports show that with harmonized sales tax we will see $11½ billion in incremental investment in the province of British Columbia. We'll also see a net increase of 113,000 jobs by the end of the coming decade. That's 113,000 additional British Columbians employed all around the province. We don't hear the members of the opposition talking about that when they seek to delay and delay the implementation of this important legislation.

[1050]

All industrial sectors in B.C. — all sectors will benefit from the sales tax harmonization. I do understand that there are some sectors that have concerns, and our government has worked with these sectors to show them how they will actually benefit.

I do get that there are some concerns about the harmonized sales tax, because it's a new system. Moving to something new brings anxiety, it brings concern, but it doesn't really merit the hysteria that some are trying to whip up, when what we're trying to do is make British Columbia more competitive through a harmonized sales tax, a value-added tax.

The HST will remove, as I've said, $1.9 billion in costs which are already there. That's the key. These are embedded costs, costs that already exist. Sectors of British Columbia, important industrial sectors, will benefit by very meaningful amounts.

For example, the forestry sector, so important to communities all around the province, especially in the interior and northern parts of B.C., $140 million. That's like a shot in the arm for investment, for job creation, for the companies in this business and in these communities. And $80 million will be removed from the embedded costs of the mining, oil and gas sector. We're not just talking about numbers and descriptions of sectors. We're talking about communities that will benefit from the investment in job creation.

In the transportation sector $210 million will be removed from the embedded costs, costs which were already, I emphasize, recognized in the pricing by these businesses. A major sector, the construction sector, one that is a major economic driver for our province, for communities around British Columbia, will benefit to the tune of $880 million.

Now, the opposition pretends that there are no economic benefits from moving to a harmonized sales tax, and it's important that we be very clear with British Columbians that there will be, as I've indicated, very meaningful, significant benefits to our economy.

The construction sector, as we know, is a sector that leads to spinoff and great benefits as people invest in probably their biggest purchase. Buying a home is the biggest investment for most British Columbians. To ensure that we keep the construction sector and the real estate sector vibrant and strong for communities, to allow British Columbians to achieve the dream of home ownership, we've put in place a rebate to ensure that for new homes up to $525,000, there would be no difference between the current system of PST and moving to HST. For homes over $525,000, a $26,250 rebate will apply to help to reduce the cost of a new home purchase. As before, there is no HST on existing real estate that will be sold under HST.

The member for North Coast talked about how the realtors are opposed to the HST. Members on this side of the House, including myself — as did members of the opposition — met with realtors yesterday. I had good meetings with the realtors who came to see me. It is simply not true to say that realtors are opposed. Realtors understand now and understand that this will be a shot in the arm for our economy, understand that there will be benefits from the harmonization of the sales tax and understand that this is the best thing that we can do to help our economy.

I know that some realtors had some anxiety when the HST was first announced, but the majority of realtors understand the benefits of HST and support the HST. I just wanted to clarify that, because the member for North Coast suggested, or actually he said, that realtors are opposed. Madam Speaker, the harmonized sales tax is the best thing that we can do for the economy of British Columbia.

[1055]

As I said earlier, every credible economist has looked at this and, through careful analysis of our economy and the benefits of harmonization, has concluded that this is the best thing that we can do. Very recently Dr. Kesselman, who is a very well regarded, highly respected economist, did a study. He confirmed that the PST, which we are talking about here and which the opposition wants to delay
[ Page 4878 ]
the removal of, the setting aside of, is antiquated — I think he used the word "crumbling" — and complicated and that we should get rid of it.

If I may, I'll just paraphrase a few of the thoughts from this highly respected professor, Dr. Jon Kesselman, who holds the Canada Research Chair in Public Finance with the graduate public policy program at Simon Fraser University. He's highly respected in the field. These are a few of the things that he's concluded, and this is very recent. This was published just in the last week.

To paraphrase Dr. Kesselman, a common adage is that an old tax is a good tax. "B.C.'s PST is not only an old tax but an antiquated and outmoded tax. Almost every other country has long since abandoned retail sales tax and adopted a value-added tax format like Canada's GST," and now HST.

One of the benefits he's talked about, which we've talked about but which the opposition conveniently does not talk about, is the fact that $150 million of tax compliance costs each year will be saved. The need for different accounting, different auditing and different reviews of the taxes is removed because we are harmonizing. That's $150 million, not to mention that on behalf of the public sector and the province, $30 million a year in having to run the tax system will be saved for administration costs and $50 million for what's referred to as vendor compensation, which is the savings from not having to pay vendors in the collection of PST.

These are just some of the points that Dr. Kesselman makes. This is very interesting. In his paper, which was published last week, he says: "The existing PST imposes a heavier burden on the poor and near-poor than the impending HST with its companion refundable tax credits." I don't hear that from the opposition. This is a highly regarded professor, and he gives an example here. This is Dr. Kesselman: "For example, a childless couple with income of $30,000 will gain by a couple of hundred dollars per year after netting their HST tax credits against their slightly higher living costs."

This is why it's important. I'm speaking against the amendment to delay the passage of this bill, Bill 9, because of the imperative of setting aside the PST, of getting on with the transition to the harmonized sales tax, which we know — and I believe that members of the opposition know — is the most important thing that we can do to help British Columbia's economy remain strong and continue to be strong.

In fact, let's talk a little bit about British Columbia's economy and how, under this government, we have ensured, as we go through these difficult economic times, the toughest recession in a generation, that B.C. will be strong, that we'll be well-positioned to come out of this recession. In fact, all economists are predicting that within Canada we are the best-positioned for a strong recovery this year and not just because of a very successful Winter Olympic Games, the 2010 games, the best Winter Olympic Games ever — which, by the way, members of the opposition opposed.

[1100]

We will this year, in 2010, have recovery. We all look forward to a strong recovery. We're well placed, not just because of the Olympic Games but because of the measures we've taken as government.

What are some of these measures? First of all, we've ensured that we're looking at our deficit. We are ensuring that our deficit, which we really don't want…. Because of the exceptional economic downturn, we have had to recognize that for a limited period of time we would have a deficit, and we have a plan to get back to surplus budgets within the next two years.

Relative to our economy, relative to our GDP, our deficit — even at $1.7 billion — is the lowest in Canada. Financial analysts around the world, people who rate the financial standing of jurisdictions, confirm over and over again that because of our prudent management, the fiscal prudence of our government, we've maintained the highest standing possible in terms of our credit rating, a triple A credit rating — the best credit rating that a province can have, right here in British Columbia. We've retained that rating, even through these challenging economic times, because of the fiscal and management leadership demonstrated by our government.

There were a number of reasons why harmonization was and is the right decision and the right move for British Columbia, and I've alluded to a number of them in my comments. The fact that Ontario was moving to HST. Another one, which I know members of the opposition want to downplay, is the fact that the federal government is prepared to provide more flexible conditions for the harmonization and the transition payment of $1.6 billion, which members of the opposition take every opportunity to belittle.

That's $1.6 billion that helps British Columbia through the transition, helps us through these difficult economic times when we want to maintain the important services that British Columbians depend on, whether it's health care or education or public safety or investments around the province.

One of the important changes that came forward from the federal government was flexibility in what we could include in terms of the items that we would be allowed to exempt under the proposed HST, under harmonized sales tax.

Members of the opposition and all those who are opposed to the HST don't talk about these exemptions, so that's led to some really quite unfortunate and unfounded fears amongst members of the general public who have not had the opportunity to look into the way that HST will work. Let me share with the Legislature some of the items that will be exempt, which the opposition doesn't talk about — right? They talk about a lot of other things. They don't talk about what will be exempt.
[ Page 4879 ]

[L. Reid in the chair.]

Just to be clear, the B.C. HST will include the following exemptions: books; children-sized clothing and footwear; children's car seats and car booster seats; diapers; feminine hygiene products; gasoline, ethanol, diesel and biodiesel when used in motor vehicles; locomotive fuel used for trains; marine diesel for boats; and aviation fuel and jet fuel used for aircraft. Basically, whatever was exempt from GST will continue to be exempt under HST. But we never hear that from members of the opposition.

[1105]

Another key exemption is the provincial credit for residential energy. You know, I can understand when British Columbians who are not aware that there would be this credit might feel some anxiety that, under HST, the costs to heat their homes would rise, but we don't hear the opposition talking about this. I just wanted to clarify that there will be a credit that is equal to the provincial portion of the HST, so there is no provincial HST on residential energy, only the 5 percent HST. We don't hear the opposition talking about that.

Another reason why it's important that we proceed with this legislation and why I'm against the amendment to delay this legislation is that when the HST is implemented, B.C. will provide rebates to ensure that schools will effectively not have to pay more under HST. Universities and colleges and also hospitals and health authorities will not have to pay more under HST. Again, we don't hear members of the opposition and others who are opposed to the HST talk about this.

We've talked about the benefits. We've talked about how HST will work. I'd like to highlight a few of the voices of support for HST. I've mentioned them in the past, but I think it's important to talk about them again. The Business Council of British Columbia, which is a group of some of the largest employers, wealth creators, job creators and investors in our province, has looked at this and is strongly in support of HST.

Just very quickly in the time that I have left, here are a few highlights from the Business Council of British Columbia. HST is superior to the current PST in terms of administration and compliance, as business can remit once. HST will provide these three efficiencies: economic efficiency of labour, capital and raw materials; economic efficiency of resources used to expand production and consumption; trade competitiveness — the ability of B.C. firms to compete in external, domestic and foreign markets.

In summary, the time for debate has gone on, and we have had ample opportunity. Members of the opposition have had ample opportunity this past month and, indeed, this whole session to talk about HST, to oppose HST. We get it that they're opposed.

Having said that, it's important that we get on with the passage of this piece of legislation, and therefore, I am to conclude speaking against the amendment. We should move on and pass this legislation to allow the implementation of HST, which is the most important thing we can do to keep British Columbia strong today and into the future.

K. Corrigan: I'm rising to speak in favour of the motion 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” for referral to the Finance Committee.

Well, we know that since this motion was first made, things have changed — certainly in the past 24 hours, as we have found out that debate is going to be curtailed, is going to be ended with the closure motion. Nevertheless, I think it's important for us on this side of the House to keep speaking in favour of that motion and to keep speaking in favour of democracy and public discourse.

I've heard speaker after speaker from the other side talking about how this is the greatest thing since sliced bread and how it'll be so wonderful for the economy, etc. They also knowingly speak in favour, so surely speak in favour of this bill, whereas a year ago, before the election, if you'd ask them the same question about what they thought of the HST, here is what they would have said. They would have said: "The B.C. Liberals are…mindful that a harmonized GST would reduce the provincial government's ability to unilaterally adjust sales tax rates."

[1110]

They would have said, just as knowingly, that the harmonized GST would make it harder for future provincial governments to lower or raise sales tax rates, which reduces flexibility. They would have said: "A harmonized GST is not something that we contemplate."

Of course, we know that they would have said that because that's what they put in writing before the election. So I find it quite incredible that so many members can stand up so knowingly now and speak for the HST, whereas we know that exactly those same members, if they had been asked to speak one year ago, would have said that there's no way that they could bring in the HST.

Interjection.

K. Corrigan: That's right. Not on their watch would that ever happen. Such a difference an election can make.

I wanted to start — in talking in favour of this motion for referral — just to address a couple of things that were said by the previous speaker. The previous speaker spoke about support and understanding that the realtors of this province have, an understanding that the HST is, again, the best thing since sliced bread. I'll tell
[ Page 4880 ]
you that we on this side of the House went for meetings with those realtors yesterday, and we got a very different story indeed.

I'd just like to read from the Vancouver Real Estate Board website. A very large proportion of the realtors are represented by the Vancouver Real Estate Board. Well, here's one of the things they say on their website. I believe it's still up there. They say: "The B.C. Liberal government broke their election promise." That's one of the comments that the Vancouver Real Estate Board has.

The Vancouver Real Estate Board also points out that the difference between the HST in the Maritimes is that when they introduced the HST, they reduced significantly the total amount of taxes. That's as opposed to, they point out, the B.C. HST, which "does not reduce the combined tax rate, as it is 12 percent" — i.e., 7 percent plus 5 percent, the PST and GST — "making consumer goods and services more expensive, as most items were not previously taxed the 7 percent PST."

The Vancouver Real Estate Board also said, comparing with the Ontario government: "The Ontario government never made an election promise regarding the harmonized tax. On the contrary, they told the public that they were determining the best course of action regarding the combined tax. The B.C. Liberal government," again, "broke their election promise not to implement a harmonized tax and not to increase taxes."

The B.C. Real Estate Association says, "The B.C. Real Estate Association and its members are concerned that home buyers and sellers, particularly buyers of new homes, will bear most of the burden associated with the proposed HST. The cost of real estate transactions will increase on July 1, 2010," and: "The people of B.C. will be particularly affected since our province has some of the highest-priced real estate in the country."

They go on to say:

"The effect of the HST will also be to introduce a new tax on most services provided by GST-HST registrants in B.C….The bottom line is that the proposed HST will increase the cost of buying and selling all property, and it will have a much greater impact on the purchase of newly built homes. Almost 60 percent of the average family's household income is required to cover home ownership costs. If the HST is implemented as planned, they'll be paying even more."

So I do not know how the member previous could talk about how the realtors of this province are supportive of the HST, when there you have what they really think of it.

Now, the member for Abbotsford-Mission said on April 12 that he was a realtor for some years, that he built condos and did development work. His suggestion was that this was no problem because all that realtors would do would be to adjust their commission to take into account the increased costs.

[1115]

We talked to some realtors yesterday who said: "Well, I'm really pleased to hear that the member is going to reduce my income and, on my behalf, says it's fine. The way that this will be dealt with is simply that my income is going to be reduced."

I really wanted to bring that up in the beginning to address the comments that the realtors of this province are in support of the HST. That is certainly not what they're saying in writing, and it was not what they were telling us yesterday when we met with them.

I want to address a couple of other statements that have been made in this House the last few days by members opposite. Yesterday, the Minister of Children and Family Development called our position deceptive. I would like to suggest that the members on the opposite side have forever lost the right to even use the word "deceptive" — to call anybody else deceptive. The biggest deception of all was getting elected on a promise that they would not implement the HST and then immediately breaking that promise.

It is also a deceptive and cynical shell game to try to then convince the people of this province that the HST was somehow wonderfully tied to the delivery of health care. It is deceptive to suggest with a straight face that we are just talking about getting rid of the PST when what we are doing is setting the table for the imposition of the HST. That's what this government has done.

But we're kind of getting our hands tied, and we are talking about it in this motion — this motion to refer. We're getting our hands tied. We've had our hands tied because we don't have an opportunity to talk about the HST. We don't get a chance to vote on it, just like the people of this province never got a chance to vote on the HST.

We heard from the member for Coquitlam–Burke Mountain — I thought it was quite funny, actually — that he heard about this at the same time as we did. I thought that was a pretty revealing statement. I think: "There you go. That just says a lot about the Liberal Party of British Columbia." No consultation; no discussion; no mention; giving a contrary position prior to the election; and apparently, not even letting members of their own caucus know.

I can imagine how those members must have felt when they had that sprung on them, and they were told that they were going to have to now spout out and speak in the Legislature, a completely different position. I can imagine how they must have felt about that.

The Minister of Children and Family Development also in this House decried those of us who even mention the polls. I guess that would be including the most recent public opinion poll that revealed that 82 percent of the people of this province are opposed to the HST — 82 percent. Well, I can certainly understand why the member wouldn't want this raised repeatedly in the House.

You know, what the members on the other side don't get is that it's not just that they're choked about the fact that there's a $1.9 billion corporate tax to be paid for
[ Page 4881 ]
on the backs of consumers. It's not just that — that that happened to them without them knowing it. It reflects the anger and the frustration that they are feeling about the fact that they were not told that this was going to happen.

So why do we think it's important to refer this matter to committee? Well, I think it would be a great opportunity for all of us to address the democratic deficit that's been created by the Liberals and to address that cynicism caused by that democratic deficit.

[1120]

Where did this deficit come from, and where does the cynicism come from? Well, part of it is that this is not a one-time performance. This is a repeat performance, saying one thing before the election and doing another afterwards.

Sending it to committee would be a wonderful opportunity to start to address that cynicism and that democratic deficit, but it's a pattern. Perhaps having more fulsome discussion and comment and input and consultation could have gone some way to reversing the pattern of saying one thing during an election and doing completely the opposite once you're elected.

They've done that repeatedly. "We won't tear up union contracts. Oops, we got elected, and now we did." "We won't sell B.C. Rail. You can count on us. We will not sell B.C. Rail," before the election. "Oops, we've had an election. Now we're elected, and we're going to sell B.C. Rail." "We are going to build 5,000 long-term beds." That one was so bad that they had to promise it twice, once in 2001 and once in 2005, and they didn't do it twice. So there's a promise that they broke twice.

Deputy Speaker: Member, can I draw you back to consideration of the amendment under debate.

K. Corrigan: Thank you, Madam Speaker.

Anyway, what they said in this case was that a harmonized GST is not something that is contemplated in the B.C. Liberal platform.

My point at this point — and I appreciate the caution — is that referring this matter to committee would be a great opportunity for this government to listen to what the people have to say about this, to address their concerns about the fact that 82 percent of them feel they have not been heard, 82 percent of them are opposed and 82 percent have a great deal of questions. Having full public discussion of this in committee would be a great way to address that.

Apparently there is a deficit that does need to be addressed in committee, because even the former Liberal Finance Minister, Carole Taylor, made comments in opposition to the HST when she said: "This particular tax takes the tax off of business. It takes $1.8 billion off of business and puts it on consumers, and that shift is ideological. But I think the bigger issue is that just before the election the Premier promised that they would not do the harmonization of the sales tax, and then right after the election they decided to do it."

Boy, that's got to hurt, to the members on the other side, to have your former Finance Minister making the same comments as so many other people in this province have.

Here we are a year later, getting this rammed down our throats without a word of regret or an apology to the people who believed what they were told before the election. Again, referring this to the committee would be a great opportunity, I would have thought, for the government to restore some of the faith of the people of this province and at the same time let them have a say about what they think and get questions answered.

Yesterday was another slap in the face of British Columbians as government forced through a vote that limits debate on this most important bill, which ends debate on this referral motion tonight and limits further debate and questioning during the committee stage to just two days. It's unfortunate that each and every Liberal on the other side of the House voted in favour of stifling debate, ignoring the 82 percent of British Columbians who are opposed to this tax and are disgusted by the deceit and betrayal of the way this government brought it in.

Here, with this motion, is the opportunity for the Liberals to at least start to apologize to the electorate of this province that they misled. Supporting this motion for referral will serve two good purposes.

[1125]

It would provide the Liberals the chance that they say they need to explain the HST to the people of this province. At the same time they can listen, finally, to what the people have to say about the HST. What an opportunity. What an opportunity to listen to what people, including experts, have to say about the HST. I can't understand why the members opposite would be opposed to that.

Instead, unfortunately, what we hear from the Minister of Finance is that government is revamping its website, its HST website, and preparing to mail pamphlets to every household in the province to help extol the tax's virtues. He said: "I think it's important that we engage in a conversation."

Conversation? I thought a conversation was supposed to have two sides. Conversation is exactly what could happen if this bill was referred to the Finance Committee. A conversation is supposed to involve the exchange of views or ideas or information. I could even understand the Minister of Finance using the word to describe the gathering of expert or public opinion, by referring it to the Finance Committee, but to call revamping the website and spending taxpayer money to send out Liberal propaganda about the HST a conversation shows just how insular this government has become.

You know, I know it's very overworked, and I almost wasn't going to say that, but the word "Orwellian…." I'm
[ Page 4882 ]
sorry, but it comes to mind as in a thought process in which ideas that are obviously self-contradictory are accepted as true, based on the fact that an authority figure is asserting them. So a one-sided conversation is, I would argue, entirely self-contradictory and may fit within the definition. Not as flagrant as some of the mantras in 1984 like "War is peace," but nevertheless quite a mind-boggling statement that sending out pamphlets and revamping a website would qualify as a conversation.

It's too bad that each and every one of the Liberal members is getting up and speaking against this motion. In effect, each of them is standing up and saying: "Let's have less discussion, not more. Let's have less discussion." Apparently they are opposed to any true conversation, any in-depth investigation. They would probably benefit. As I said earlier, I don't believe any of them, except perhaps the chosen few, were ever privy to or aware of the decision to bring in the HST before it actually happened. You know, you couldn't have that getting out during the election or just after the election — whatever it was — although I don't think anybody in the public believes this was not a decision that was made before the election. Maybe a few.

No, I think the members opposite were just as surprised as those of us on this side of the aisle and the public. So let's clear the air; let's send it to committee. What could happen at the Finance Committee? The motion is, as we said, 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 and assist in its deliberation" — to bring in expert witnesses. Not only that, but this presumably could be a forum to allow members of the public to have a direct input by making written submissions and participating in public hearings.

The referral of Bill 9 to the Finance Committee would allow for a more detailed examination of matters than would be possible here in the more formal environment of the House. A select committee can examine government policies, expenditure and administration and can question ministers and civil servants, interested bodies and individuals.

[1130]

This all sounds like a fine idea considering how many people are opposed to the HST in this province — how much of a huge issue it has been to the people of this province. It seems to me that some more public discussion, some opportunity for input through hearings and published reports, how much benefit that could be to this province, to a province that is feeling that it has not been heard.

These hearings and published reports that they bring before parliament and the public can have a lot of fact and a lot of information so that we in this House could vote on the basis of informed opinion. We could have witnesses with expertise and experience in the field of inquiry. There you go. Instead of a major tax policy change with absolutely no public discussion, no investigation, no facts before the decision was made, no research, this would be an opportunity to instead have an informed position.

Mind you, on the other hand, maybe not so popular for the members on the other side of the House, because committees can also play a role in scrutinizing government, and sometimes some of the evidence, the oral or written evidence, could perhaps lead to some of the members and ministers opposite squirming in their seats, and I don't think that the members opposite want that. But, you know, democracy can be messy.

The government got this all backwards. The whole process is backwards. The Finance Committee recommended in the fall of 2008 that a cost-benefit analysis needs to be conducted to determine whether a harmonized sales tax may be worth considering, and no such analysis was performed. It was only in March of 2010, eight months after the HST was announced — eight months — that a government study, after the fact, was released. It's backwards. It's an incompetent way to do things, frankly, and shows a flagrant disrespect for the taxpayers of this province.

First they make a decision to bring in the HST because somewhere behind closed doors a deal has been made that if B.C. brought in the HST, the federal government would pay $1.6 billion, which was very helpful and very necessary, given their fiscal situation. Then, about that time, before or after there's an election, an election in which they said there would be no HST, consumers rightfully complained that they had not been told about this during the election. Small businesses screamed that they had specifically been told there would be no HST.

Then months after the announcement was made, government gets a shoddy report thrown together to attempt to retroactively justify the decision that had been made months earlier. What an unbelievable way to do business and spend the money of the taxpayers of this province.

Well, Liberal members keep saying that it's the best thing that could happen to this province, but they have no evidence. They're putting together the evidence retrospectively, supposedly. If it's such a great thing, I would think that the government would welcome a fulsome discussion of the merits and drawbacks of the HST, and that is what this referral motion would do.

If it is, in fact, the best thing that we can do, why on earth not drag out the process? Heaven knows, the members opposite have certainly tried to do that with the Olympics. Heavens, we could have committee hearings and bring the report back to the House, and probably we could be moved to a spontaneous rendition of the national anthem.

I just don't know why this government wouldn't want this to happen if they're so confident that this is so good. Of course, I'm being facetious.
[ Page 4883 ]

Interjection.

K. Corrigan: Yes, I am, in case nobody caught that.

[1135]

The reality is that the members opposite don't want any further analysis or input because they know what they're going to hear. They are going to hear what the people of this province say — the businesses, the consumers, the 82 percent of British Columbians who are opposed to this tax — and they can't control that message.

This government does not like the messiness of democracy. They only want a message that they can control. And talk about control. I really do feel bad for the members opposite. I wonder how much input they had into this. They didn't have any. They had no idea, and they were told to go out and spout the party line. Boy, oh boy, it must be tough going back to your constituencies on the weekend.

I would have felt bad if any of you had stood up and opposed it instead of just following the party line, but you lost my sympathy there, because every single one of you has stood up and said what a great thing this is. So the sympathy vote is gone. Too bad. All we needed was seven MLAs to stand up for 82 percent of the people. And it's not just the 82 percent; it is what is right. You should be standing up and opposing this tax, and you know it.

I want to get back to this determination to control the message. Government doesn't want to send this to a committee; doesn't want to hear from the public; doesn't want to hear from experts who could provide some very beneficial, useful advice; doesn't want to hear the analysis. It just wants to control the analysis, wants to pay for its own analysis — that they knew what the answer was going to be, because the person who wrote that paper, Mr. Mintz, had already said what he thought. It had already made up its mind and doesn't want to hear anything inconsistent with this message.

If we sent this to committee, we could hear from people like Murray Martin, who wrote a letter to my local paper. He says: "It is true that they are against welfare for the poorest 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…."

Interjections.

Deputy Speaker: Member, excuse me.

Members having conversations across the floor will come to order.

Member, please continue.

K. Corrigan: I'll continue with Murray Martin's letter to the editor. He said: "The HST is a multi-billion-dollar tax break to corporations, with the burden shifted to the citizens of B.C. Essentially, Richard Lee's B.C. Liberal Party is promoting the welfare of the ones who need it least while ignoring the long-term welfare of B.C. citizens."

Deputy Speaker: Member, if you are using a name of a member of this House, it is by riding, as you know.

K. Corrigan: Thank you, hon. Chair. I was under the mistaken impression that if you were quoting a newspaper story…. I will not make that mistake in the future. I continue to learn, and I will heed that. We learn from our mistakes. Some of us learn from our mistakes.

Going to committee would also be a place to consider what the member from Delta said earlier when she spoke on this matter. She expressed a real concern. I think it's a very legitimate one, and it's one that I've heard as well in my community. She expressed a concern that workers are going to go underground, that more and more small businesses will simply stop paying taxes at all.

J. McIntyre: I'm delighted to rise today and speak in my turn against the amendment that would like to defer second reading of Bill 9 and refer it to the Finance Committee. It's such a blatant delay tactic. I know we have to debate it, and I will, and I have comments about it. But it's a very obvious ploy, and I would like to make that point.

Before I do, I wanted to take a moment, because it was very difficult to actually sit through the member before me, from Burnaby–Deer Lake, with basically a holier-than-thou attitude defending a party, which after their decade in power, through their antics and their complete fiscal mismanagement of the province, was reduced to two seats. That's what the public thought about how they would like to run the province. I just want to remind people of that.

She was talking about things like flexibility and that our reason for not contemplating it a while ago was that we would lose flexibility. I don't know whether she's been following this or not, but one of the inducements the federal government gave us in May of last year after the election was the flexibility to go in at our rate, at 12 percent. Previously, we would have had to go in at 13 percent.

[1140]

Of course, I can see why others before us rejected it. We weren't interested in raising the sales tax. Now we have the flexibility to control the rate. We can change the rate after two years, and we could go in on July 1 at a rate of our choosing, at 12 percent. So she doesn't really know what she's talking about, obviously.

Anyway, I'll go back to this whole notion of referring to the Finance Committee. I went back, and I looked at that November 2008 Finance Committee report. I looked at the tax policy sections, and there were 14 recommendations. Of course, one of them, as much has been said on, was to look at an analysis of the harmonization of the
[ Page 4884 ]
provincial sales tax and the federal goods and services tax, which has been recommended before. This was not the first time. A number of multi-member committees…. Both parties were represented on this committee.

I want to talk about that, 2008, because there were four members of this Legislature now who were on that committee, who asked us to look at that very strongly. One of them would be the member for Surrey-Whalley, who's now the Finance critic. Others: the MLA for Skeena; the MLA for Malahat–Juan de Fuca, now MLA for Juan de Fuca; and the MLA for Coquitlam-Maillardville. Those four members of this very House were on that committee.

That committee did tour the province. That committee heard from people. That committee heard from small businesses all around the province. They were all asking us to get rid of the embedded, cascading PST because it was the single biggest impediment to economic growth in this province. Members of the other side of this House supported that, so it's a bit rich to hear all of this now going on and on and on and to look at them trying to delay implementation of Bill 9, to delay the second reading of Bill 9.

It was sort of fun looking back at some of those other recommendations too, because funnily enough, there were about three or four that were all about looking at PST exemptions — like rationalizing and simplifying the rules for PST exemptions; and reducing, in some cases, the PST for agriculture, for forestry and for the trucking industry.

They also looked at creating a PST exemption for the purchase of proven fuel-reducing technologies in the trucking sector. Oh, and they were looking at PST revenue on fees for legal services, and on and on — just further proof that the PST was a hodgepodge of regulations that were not clear, that were causing impediments to things like our natural resource sector and our trucking industry and things like that. There were already recognized problems with the PST.

In case some of the viewers and some people don't really realize that the NDP opposition to Bill 9 and their amendment to delay it…. It basically wants to support the PST — right? The flip side of all of this is that they like the PST. There's no other way to interpret it but that they want the PST, which has been recognized by experts as a problem in our economy.

The other thing that I thought was interesting in looking at these 14 recommendations is that we've actually brought some of them in. We've actually raised the small business corporate income tax threshold to $500,000 to match the threshold of the other provinces. We've also expanded the visual effects tax credit to include digital animation, audio effects and post-production activities and games. I was just speaking about that in the House the other day. We've also extended the B.C. mining flow-through share tax credit to stimulate minerals exploration.

So we take recommendations from the Finance Committee seriously. We've been acting on them, and acting on HST was just another example. We took a look at it, decided for the times, with the flexibility and the situation we found ourselves in May-June of last year, that this was an important step to take.

Just before I leave this thing, I thought it was very interesting — and our Finance Minister raised it in the House yesterday — that a very member of that Finance Committee, the member for Juan de Fuca, actually was speaking favourably at those hearings way back in '06, at the Finance and Government Services hearings, when he said: "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" — imagine that — "with both sets of bureaucrats. That's the motivation for her for harmonization."

That would be the member for Juan de Fuca, so I guess maybe he's changed his mind, just like, maybe, on Site C. Same way — he's sort of back and forth, a flip-flop. So that's interesting.

Interjections.

J. McIntyre: Now, if I can hear over the din here, I'd like to also speak, as others in my caucus have spoken, about Jon Kesselman's recent paper and then the article he actually wrote in the Vancouver Sun on April 21.

I thought it was interesting, because the member for Burnaby–Deer Lake kept sort of dissing, I guess, for lack of another word — dismissing, more politely — the reports. She said: "Shoddy reports and things." She was talking about…. I certainly hope she wasn't talking about Jon Kesselman, who holds the Canada Research Chair in Public Finance with the graduate public policy program at Simon Fraser University.

[1145]

Oh, lo and behold, that's the member for Burnaby–Deer Lake. Simon Fraser — I think it's in her community.

Interjections.

Deputy Speaker: Member.

I would ask members to come to order.

J. McIntyre: Thank you very much, Madam Speaker. It's a little hard to hear myself even think above the din.

So I do want to cite some of the important comments from Jon Kesselman's article, because he really, really underscores the whole idea. As he said: "HST critics need to take a closer look at crumbling PST."

To my comments earlier, when they're opposing and wanting to defer this Bill 9 to the Finance Committee, the NDP opposition and those who are out in the public
[ Page 4885 ]
opposing this are actually defending the PST. So this is what Dr. Kesselman has to say. "After all their publicly bandied criticism of the HST — much of it misinformed and misconceived — opponents of this tax reform need to justify the retention of the PST."

I haven't heard a word from the side of the opposition on the 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."

He goes on to say: "Almost every other country has long since abandoned retail sales taxes and adopted a value-added tax format like Canada's GST. Moreover, no country besides Canada simultaneously employs two such divergent forms of sales tax at the national and subnational levels."

I can just shout louder. "Retention of the PST in B.C." — oh, I'm sounding like the member from Cowichan, whatever — "would leave the province's businesses with an unnecessary $150 million of tax compliance costs each year, which push up product prices for all consumers." That would be consumers in British Columbia — surprise, surprise. "Retaining the PST would also leave the provincial government burdened with annual costs of $30 million for administration plus $50 million for vendor compensation."

He goes on to say: "The existing PST imposes a heavier burden on the poor and near poor than the impending HST with its companion refundable tax credits. For example, a childless couple with an income of $30,000 — above the poverty line — will gain by a couple hundred dollars per year after netting their HST tax credits against their slightly higher living costs."

Do we hear any of that? Do you hear members from the opposite ever talking about that? Do they actually say that with the protection we've built in for lower-income people, they could actually be slightly better off? No, because they're not telling the whole story. They are not telling the whole story to the public. They're defending an anachronistic, cascading, embedded tax. They're defending the PST as the way to go.

Interjections.

Deputy Speaker: Members.

Excuse me, Member. Please take your seat.

Members, it is not appropriate that the Chair has difficulty hearing the member who has the floor.

Please proceed.

J. McIntyre: I think that it's just very, very important that the public is engaged in this debate. They want to know what's going on, and we are trying to communicate to the public through business and through supporters the benefits of this tax.

What we are dealing with here is misinformation, disinformation, not telling the whole side of it and defending the PST which has been recognized…. That's what this bill does. Bill 9, that they want to defer, repeals PST, which has been recognized as — I'll say it again for the 18th time — the single biggest impediment to economic growth in this province. They are defending that.

It is just in line with the same kind of political opportunism that they've exhibited on just about every opportunity. I have no idea how the NDP can justify retaining the PST. They're not telling people. I've been in the House. I'm not hearing anybody….

I sat here through the member for Burnaby–Deer Lake. She didn't say one thing about why the PST was good for British Columbia. I didn't hear her say that. I never heard a word about the PST. Did anybody else? I never heard a word. I never heard a word about the PST. I never heard about why the PST is good for British Columbia. That's what you're defending.

[1150]

Interjection.

J. McIntyre: No, that's what you're defending.

Well, Jon Kesselman from SFU had some other words to say about that. They are not telling the whole story.

Madam Speaker, I would like to turn my comments to providing some context for some tax policy from the government and also for the HST, and some of the positive aspects and comments of the HST. But I was just noting the hour, and I wanted to reserve my right. I will not be finishing my remarks at this time — okay? So I will begin, then.

Let me begin with setting a context. I'd like to set a context for the tax policy in this province and where the HST fits in and why we should not be deferring the bill. The B.C. Liberal government has been working hard to build a more nationally and internationally competitive business environment since we were first elected in 2001. That's been nearly a decade.

Throughout the 1990s punitive personal and business tax policies drove people, companies and investments right out of this province, and we've been working every day consistently to fix that immediately, starting with significant personal and business tax cuts.

Interjections.

Deputy Speaker: Members. Members.

Columbia River–Revelstoke.

Proceed.

J. McIntyre: The tax cuts that we introduced immediately in 2001 have stimulated our economy by actually bringing investors back to British Columbia, despite howls from the opposition — howls like we've just been experiencing over the last half-hour.
[ Page 4886 ]

In context, the HST is the next step in building a stronger B.C. economy as we work to drive B.C. out of the worst recession since the Great Depression. So again, this NDP move to refer it to Finance Committee is just a delay tactic, and it's holding back recovery for the people of British Columbia.

Again, in talking about the table, the foundation, we laid in the early parts of this decade combined with more than 120 tax cuts that we'd introduced this decade, the proposed HST means that British Columbia will actually continue to pay the lowest taxes in Canada. The opposition doesn't tell the public any of that. They don't tell them that the HST is part of tax policy.

We've lowered the small business tax rate from 4.5 percent to 2.5 percent in '08, which is the second-lowest rate in Canada. By April of 2012 it's going down to zero. We're talking zero, the lowest level in Canada.

We just raised the small business corporate income threshold from the current $400,000 to $500,000. As I just mentioned, that was recommended by the same Finance Committee hearings in 2008 that actually recommended we look at harmonization of the taxes. That's interesting. We also lowered the corporate income tax from 16.5 percent in '01 to 11 percent in '08, and it will be at 10 percent by 2011. It's the lowest in Canada.

Interjections.

J. McIntyre: Maybe I'll just answer the members — the members who have been heckling throughout this whole conversation. It does help, because they obviously don't understand that lowering corporate tax rates here actually attracts investment, creates jobs — jobs that British Columbians want. They don't even understand that.

We eliminated the general corporate capital tax. It was the most hated tax in British Columbia. We removed it, and the province soared. They don't understand that a competitive tax regime actually attracts businesses and builds jobs, builds an economy, builds a healthy environment so that people can actually go out to restaurants, so that people can take a trip — right? They don't get it. They don't even get the basic economics. It's embarrassing.

Then it's not just business taxes. We've cut personal income taxes. They were reduced by 37 percent since 2001. So 325,000 lower-income British Columbians in this province don't pay a penny of provincial tax.

[1155]

Okay, noting the hour. Sorry. I'm mindful of the clock, and I know I'm sitting between a speech and lunch. Anyway, noting the hour, Madam Speaker, I'd like….

Interjections.

Deputy Speaker: Members, come to order.

J. McIntyre: Boy, it's difficult enough. They won't even accept a motion to adjourn debate.

I'd like to reserve my place to continue my remarks, Madam Speaker, and move adjournment of debate.

J. McIntyre moved adjournment of debate.

Motion approved.

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

Hon. B. Penner: I just want to seek clarification that we voted on adjournment of debate, and that was passed.

Deputy Speaker: That is correct.

Hon. B. Penner: And we've moved…

Deputy Speaker: …committee Chair.

Hon. B. Penner: …committee Chair — next sitting of the House, Madam Speaker, for the committee.

Hon. B. Penner moved adjournment of the House.

Deputy Speaker: This House stands adjourned until 1:30 this afternoon.

The House adjourned at 11:57 a.m.

PROCEEDINGS IN THE
DOUGLAS FIR ROOM

Committee of Supply

ESTIMATES: MINISTRY OF FORESTS
AND RANGE

(continued)

The House in Committee of Supply (Section A); L. Reid in the chair.

The committee met at 10:13 a.m.

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

N. Macdonald: We are going to focus on fires, so that will be the first area that we go to. But before that, I just want to say that I looked back at the debate that took place yesterday. I looked especially at the reorganization and tried to understand the case that was being made with the reorganization.
[ Page 4887 ]

It was a very polite discussion we had — as always, respectful of staff — but it was hard not to reach the conclusion that the Forest Service is being abandoned, that the changes that are taking place don't follow any logic that fits with the public good. The concerns that were raised around how, over a four- or five-year period, to sensibly move forward with the Forest Service didn't seem to be addressed in any way.

The premise that this was driven by harvesting did not make sense to me, and I don't think it makes sense to the public. I guess what I would leave with the minister is that, as the critic, you're hoping actually for the same thing that presumably the minister is — and we've had this discussion a lot — that the public lands are going to be looked after and that the people that do that work, the Forest Service, is going to be there to do that work.

The odd thing is that I actually know that the minister feels the same way, but I also feel it's remiss if I don't say that my expectation is that the minister is going to be at the table fighting for more than what we have here. These cuts are going to be damaging. These cuts do a disservice to a forest service that is going to be celebrating its centennial. When I was principal of a school, I would always go there and fight for my school, and it just….

[1015]

That's the challenge I have for the minister. If the minister comes back next year with more cuts instead of getting in there and getting the resources that we need to do this properly, I think the minister will have failed. He'll have his opportunity to stand up and rebut that.

I do want to move on to the fire issue. The question that I have for the minister is on the budget. We've canvassed this before. It's $52.821 million. That is the number I see here for "Direct Fire". Where does that number come from? It seems a number not at all related to the past experience we have with forest fires, so where does the number come from?

Hon. P. Bell: This is always a good discussion to have, because it is a very complex decision — how you manage fire budgets. I'll just relay to the member opposite that over the last ten years the range in terms of annual expenditures for "Direct Fire" is a range from a low of $21 million to a high, as we know last year, of about $400 million. I've seen two numbers between $397 million and $403 million, but for all purposes, let's say it's $403 million for now.

As you are contemplating how you define a budget, you have these massive swings from one end to the other. In the year that you are projecting, for the sake of argument, if you chose to establish a budget of $200 million, which is kind of roughly halfway between those two points, you'd still be $200 million short in the year that you spent $400 million, and you'd have $180 million more than you needed in the year you spent $20 million.

What we do is look for if there is a representative year or representative number of years where an expenditure seems to be a logical amount of money. We look for that and establish that. Then the statutory authority that the ministry has, that the minister has, to spend whatever is necessary in order to protect our forest — people's homes, people's lives — kicks in and draws funds out of the general contingency fund within government.

If you go back from starting in '99-2000 and going forward, the expenditures were $21 million, $51 million, $54 million, $37 million and then $371 million in 2003. The member, I'm sure, remembers that. It was $164 million or $165 million in 2004, and then back down to $47 million the next year, and then up to $159 million, and then down to $98 million and then at $82 million. So you get these massive fluctuations.

If you look through that period of time, what it appears is that in about half of those years the $52 million budget is about the right number, but once you go through that $52 million budget, all bets are off. It could be $400 million, or it could be $120 million. It's very, very hard to budget.

When the statutory budget was established — or the statutory authority to spend whatever is necessary — I'm sure that it was done…. I was here at the time that that was done. I think it was probably even in the '80s or the '70s — quite some time ago — that that decision was made. It was clearly made on the basis of the recognition that it was virtually impossible to try and determine budgets.

The preparedness budget of $52 million allows us to do the groundwork necessary to put resources in place, to hire staff, to have resources on the ground and ready to go. For one of those average years, it provides enough money to cover that. Even in years where fire could be more extreme, it may be enough, if they aren't interface fires, because as the member knows, it's the interface fires that get very, very expensive very quickly.

[1020]

It is a complex process to go through budgeting. Certainly, in the last few years we're starting to see less of the norm and more of the abnormal. We're paying attention to that and thinking about our budget application for 2011-12 from that perspective.

N. Macdonald: Well, it's actually not that complex. You have a central theme, a central rationale for arriving at a number, and there's no rationale that the minister can provide.

In the past the rationale has been some sort of an average. Well, this is not a five-year average, a ten-year average. The ten-year average on the ministry website is $115 million. Given that the minister has characterized the upcoming year as likely to be a season — and on into the future; nobody can predict — where there's more wildfire, to arbitrarily choose a number of $52 million
[ Page 4888 ]
does not seem to be an accurate representation of what is going to be spent. In the budget there should be an accurate representation.

I'll just give the minister an example of just how common it is for jurisdictions to budget for items where they're not clear, completely, on how much they're going to have to spend. When I was mayor of Golden, each year we had to set a budget for street cleaning. Now, if there were more storms, then we would have to move into contingencies. But we tried to put in an accurate number and have a central rationale.

I guess the question for the minister is: what is the central rationale? In the previous answer, I heard that it's complicated and everything like that. I don't think it is. You're driven by a central rationale. In the past it was a ten-year average or a five-year average. But it has to be a realistic number. Otherwise, why not $51 million? Why not $60 million? I mean, it's just picking a number out of the air. So what is the central rationale for the number that is in this budget?

Hon. P. Bell: I know that the member rejects the rationale that I have provided him, and I understand that. That's fine. But I'll reiterate, and I'll try and clarify, because perhaps I wasn't clear enough either.

The rationale for the establishment of the amount of money that we budget, $52 million, in fire preparedness is for exactly that — fire preparedness. It establishes the necessary funds to hire the human resources, put the contracts in place for equipment that is necessary to prepare for a fire season and to manage fire through that season if it is what would have occurred in about half of the years that we've seen over the last ten years.

The statutory account, which then allows me to access additional moneys, is based on if we get a fire season that doesn't fall within the half of the fire seasons in which the $52 million would represent an appropriate amount of money.

So to be clear, it's based on the amount of money that's required to prepare for the season. That's why it's called the preparedness budget. It puts the appropriate number of staff in place, allows for the staff training and assigns the helicopter and fixed-wing resources and the remainder of the equipment that is necessary for the season.

Much as the member opposite referred to snow removal…. I think it was snow removal costs in Golden and Prince George — certainly, the same thing. As I understand it, in municipalities they carry money forward into future years out of that account, and they have the accounting ability to do that. We don't have the ability to carry money forward in a fire account from year to year to offset bad years against good years. We don't have that ability, so we have to budget what makes sense to prepare for the fire season, and that is why it's called the preparedness budget.

N. Macdonald: Well, with local government, as well, if you didn't spend it, it would go into general revenue. Then you always had a contingency that you would draw from — right? So it's not dissimilar.

It seems to me to make sense that you would have an accurate number. Essentially, the minister is saying that this is for fire preparedness. You already have fires. I guess, to date, and this is only April, we have 135. I don't know how that compares to most years. According to what the minister has said, there is anticipation of the possibility of another intense wildfire season.

[1025]

Sensibly, if that is what the minister is anticipating, there would be a firefighting budget. If this is not the firefighting budget, then what is the projected budget that the minister has for firefighting? What are the projections, and why would those projections not be part of the minister's budget that he's presenting here?

Hon. P. Bell: A couple of pieces to the equation. First of all, I want to point out the timelines in which the budget is prepared. We actually start the work in kind of the late, late fall period, early winter period. The budget is largely locked down by the end of January. Predicting spring and summer weather in January is very challenging, so you base it on the best level of information that you have at that point in time.

For the weather, Environment Canada provides us with a long-range outlook. With those long-range outlooks, of course, the further out they get, the chances of them being accurate are certainly lower. Most recently we are feeling somewhat comfortable that May and June are, based on Environment Canada, likely to be warmer than normal and dryer than normal. July and August are showing that same trend, but that still falls in the category where it's really too far out to know if that's going to be accurate.

However, that all said, I'm not disagreeing with what the member said, which is that I'm very concerned about this fire season and the potential for it to be another bad one. That's why we chose to bring resources on early this year. The member will recall that last year there were some early-season fires in the 70 Mile House area, prior to us having aircraft on, so we've adjusted and brought aircraft on two weeks early this year and are ready to go.

The member asked about the number of fires. This is, again, where you have to have kind of all the information to really understand what's going on out on that landscape. It's dangerous to just take one element. As of last Thursday there had been 112 fires so far. So the numbers that the member has are probably the most current as of today, I'm guessing. I don't know where he got them from. But the historic average to that point normally would be 61 fires, so that's the historical.

Immediately that would lead you to the conclusion that we're already way ahead of pace and facing a very
[ Page 4889 ]
challenging year, where we've seen almost double the number of fires that we would normally see at this particular point. But if one looks further than that and looks at the cost of managing those fires…. Fires can be very, very small — a few metres in size — or very, very large, and the costs borne relative to each of those, of course, are significantly different.

Our current costs to date this year are $160,166. The historical average for this time of the year, for this date, would be $286,876, so we're not quite half of what a historic average would be. It's very dangerous to try and predict on that basis, but on the general comments that the member makes, I am supportive. I agree that we're looking at a very challenging fire season.

I've already been out in the media talking publicly about that. We have made decisions around bringing in resources and aircraft early and are preparing for what could potentially be a difficult season. That information we did not have when we prepared our budget. We based it on the best information that we had at that point in time. That's why the statutory account exists and allows me to go and access those resources when I need them.

N. Macdonald: Just to frame this. I think that in the past five or six years the budget has been overspent in most of those years — perhaps five of the last six or six of the last seven. So it has been an inaccurate budget consistently over the past number of years.

I agree with what the minister said last summer and has said since — that the intensity and the cost of fighting fires are going to increase. It does beg the question why you would not have an accurate number in the Ministry of Forests and Range for dealing with forest fires. It begs that question.

[1030]

The minister talks about the preparations that have taken place. The preparations that flowed from the Filmon report — and we had this debate last time — that were acted on paid dividends last fire season.

The area that is more complex but that still seems to be lacking is around the community wildfire plans. That's, again, where I want to go with the minister. Just to begin, what does the minister have in terms of statistics for the percentage of the community wildfire plans that have been completed, that have been prepared and presented to the Ministry of Forests and approved as valid community wildfire plans? What is the percentage of work that was identified by those plans that has been completed?

Here the focus would be mainly on the fuel management side. I realize that these plans have a number of areas, including bylaws and different things that communities are being asked to act upon, but I think the provincial interest would be primarily on the fuel management around the communities.

Hon. P. Bell: There are a whole bunch of numbers here. I'll provide them to the member, and then he may have some further questions as a result of that. Our numbers show that there are 189 non-aboriginal communities in the province.

The member asked how many wildfire management plans have been completed, and the answer to that question is 78. I have the names of all the communities if the member opposite would like them, but he'd be pleased to know that his hometown of Golden, British Columbia, is completed. I'm looking for Quesnel, British Columbia, noting that the member beside him may want to know whether or not…. I don't actually see that theirs is completed. Smithers — good news for the member — has been completed as well.

[1035]

Altogether, there are 78 completed. There's a total of 158 wildfire management plans that are either in process or completed, so that would lead one to believe that there are 80 that are incomplete at this point in time. That work is ongoing.

The member asked how many operational projects in terms of fuel treatment have been completed. I think that was the question. The answer to that is that 138 different operational projects have been completed.

I think I'll just leave it at that. I'm sure there are further questions, but I'll leave it at that at this point.

N. Macdonald: Just referring to the work by the Forest Practices Board, they used a figure of 685,000 hectares in B.C. that are considered at high risk of an interface fire. Now, I don't know how that compares to the hectares that have been identified by communities. It's possible that these are different numbers. I think last estimates — I was looking back — the minister used an estimate of 1.7 million hectares. When we're talking about these figures, it's really easy to mix up the various numbers.

The information that the Forest Practices Board has…. It may be dated. They say 35,000 hectares have been treated. So it leads you to…. If you're using the numbers from the Forest Practices Board, you say 5 percent of the work that needs to be done has been done. I doubt that that's a completely accurate representation of the comparison of the work that needs to be done with the work that has been done.

The ministry, obviously, will have been keeping track of this and will see that their responsibility lies with making sure that communities are protected from wildfires that come in from the Crown lands. What is the minister's assessment of the amount of work that has been completed compared to the amount of work that needs to be done?

Hon. P. Bell: A few things I want to touch on. The discrepancy of the numbers — 1.7 million versus 685,000. The 1.7 million comes from the Filmon report and was
[ Page 4890 ]
identified as potentially at-risk interface zones. The 685,000 was a refinement of that, and that's what we within the Ministry of Forests and Range and protection branch consider to be the higher-risk zones.

[1040]

So the 685,000 is a refinement of 1.7 million, which was just a large kind of brush-stroke number initially in the Filmon report.

The other thing that's important for the member to know is that that includes private land and municipal land as well as Crown land. So the 685,000 isn't necessarily just Crown land for Crown treatments. It includes other forms of land that we consider to be of a high risk, both private and municipal lands.

The member asked where we are at now. We're a little over 40,000 hectares. It's what we think has been treated at this point. But I want to add — and I know I've said this before publicly — that hard-digging, gritty reporter Sean Holman has been on this file for some time and is constantly questioning it.

There are two points that I always try and make about it. The first is that while fuel treatment is part of the equation, without a doubt, community planning is equally, if not more, important. We as a society have decided that we like to live in the forest. I am guilty of that. I live on a piece of property that likely would be considered at risk. It's in a forested area.

I've seen the maps in Prince George, and we're in the second-highest-at-risk area. But we choose to do that, and many others do in British Columbia. There are a wide variety of people that choose to live on small acreages, which typically become those areas where there is a higher level of risk.

So community planning is absolutely key. As a number of communities in this province, we've tended to plan our plans into where people like to live, which is in forests. When you move into forests, you inherit some of that risk just by nature. So community planning is absolutely key.

I didn't introduce Brian Simpson earlier, who is head of our wildfire branch. Brian and his team do an incredible job. I know that the member opposite agrees with that. They are constantly reminding me of the importance of community planning. Those are the things — like putting soccer fields on the outside of a community, on the edge of a community — that give Brian and his team a place where they can take a stand on a wildfire coming into a community. It's about placing a road on the outside of the outer limits — again, creating kind of a natural break that gives them a place where they can take a stand.

In the Glenrosa fire last year there were a number of orchards and vineyards in that particular area that created an opportunity for us to, again, take a stand. That was helpful. So there are a lot of those sorts of initiatives.

Another key one that we rarely talk about but that I think Brian and his team attribute a significant portion of success to is our structural protection units, which we acquired after the 2003 fire, as part of the Filmon report, distributed around the province and located in strategic locations and made available to places like the Glenrosa fire and many of the other interface fires that we had last year. The fact that we were able to go from 350 structures lost in 2003 down to just seven last year was a direct result of those structural protection units.

Although it's always tempting…. I know Sean Holman has been focusing very much just on the one element of protection of our communities. There are many different components. To satisfy some, they would tell us to focus all of our fiscal resources just on interface fuel reduction strategies. One of the key strategies that has yielded huge benefits is the structural protection units.

So community planning is key. Ongoing treatment is key, and we agree with that. We need to continue to do that work, but all of the other elements are important as well.

I think I'll just finish off by saying that this is not a project that you finish, that you complete. This is a project, in my view, that Forests Ministers 100 years from now are going to continue — when they're celebrating their 200th anniversary of the Forest Service — to stay focused on.

[1045]

We, unfortunately, as a result of lack of attention — and I'm not placing blame on anyone — historically, on fuel loading, have allowed this to creep up on us and have had an abundance of incremental fuel load on the forest floors. Now we're trying to get ahead of that and are having some success in that area, but this is going to be an ongoing issue, I believe, into the future.

N. Macdonald: Obviously, the things that were done well we're not talking about here, but certainly, I think, in the past I've acknowledged that the recommendations that were worked on and Mr. Simpson and all the work that they do is very, very much appreciated by everyone. There aren't very many journalists who pay close attention to this. I think there's essentially one, and I'm thankful for that, but the pieces that we're missing we have to start to get right.

The minister talks about things like how we organize our community. Well, all of those things should be considered in the community wildfire protection plans. Those are the things that the provincial government has as a tool to focus local governments on thinking about how they lay out their community. Hopefully, they've done that thinking.

It is only fairly recently that we're starting to get to a place where most communities have their community wildfire protection plans. Remember, this was something that was supposed to happen quickly after 2003. What I would say is that the minister turning his attention to it makes it happen pretty quickly.
[ Page 4891 ]

The bigger puzzle is the fuel management. That is complex. If you look at the report that was done by the Forest Practices Board, they lay out very clearly the complications for local government. And they lay out very clearly — it's fairly mild language, but it's very clear — the role that the province has to play in terms of dealing with that very complex issue of how you are going to have communities so that when we ask people to come in and protect those communities, the work that needs to be done has been done.

I would say — and this is anecdotal — that the minister has basically repeated the same things I have heard. The experience from Kelowna was where the work was done. It gave those people that we asked to deal with that very dangerous situation an opportunity to deal with it more effectively.

You go to Lillooet, where work was identified but not done — I hope I have my facts correct here — and it became more complex and more costly.

What we need to see…. It's 2003, seven years later, and 5 percent of the work is done. It speaks to the need for the minister and for the ministry to take more of a lead in making sure that we use the resources properly, identify the areas that need fuel management and get the work done so that next year we're not just at 6 percent; we're in a place that we feel comfortable as we go into what we expect to be increasingly challenging wildfire seasons.

I guess, to leave this issue, I would ask: when does the minister anticipate getting to a place where he feels that most communities have completed the fuel management work that they feel needs to be done? I guess I'll leave that. At what point does the minister think that we're going to be at a place where this fuel management work has been properly done?

[1050]

Hon. P. Bell: The member opposite used the number of 5 percent of the work was done. Again, I think he's using a very narrow view of what the work is. While one could spend hundreds and hundreds and perhaps billions, if not hundreds of millions of dollars, on fuel management reduction strategies, you could spend a few million dollars on structural protection units and get more benefit from those structural protection units than you would from $500 million worth of fuel management strategies.

It's important to spend the money in the right areas, and while fuel management is important, I don't believe that you can suggest that 5 percent of the work has been done, because things like structural protection units, I think we believe, are appropriately allocated at this point in time across the province.

Other things, like capital upgrades that we've done to fire bases, particularly for our fixed-wing fleet, have been important. It's allowed the cycle time for aircraft reloading and getting back out on site to be much shortened. So again, a few million dollars in a capital investment yields significant benefits in terms of the ability of our aircraft to get out.

Although the member…. I understand what he's pointing to in suggesting 5 percent of the fuel loading. I think that it's actually about 7 percent, according to my math. But he was a socials teacher, and I was a math teacher, so we'll let the audience decide whose numbers they want to use. I don't think that you can confine and suggest that 5 percent of Filmon has been complete. Not that the member said that. He didn't say that, but I think that's important.

The member asked me: when will I feel comfortable? Probably when I'm sitting on my sundeck having a beer, but I actually don't think you ever feel comfortable in this role when it comes to wildfire management. I don't think that you ever will feel comfortable, because even with a very good strategy around fuel-load reductions, you'll still have challenges.

The direction the member was going to…. I think there's some insight in looking into last year and answering the question: where did fuel reduction strategies help us, and where had fuel reduction strategies not taken place where it would have been helpful had they taken place? This is just anecdotal, in speaking with the head of the protection branch.

There were four fires in particular that we can point to where we think that there was a significant benefit as a result of the fuel reduction strategies. The Alexis Creek fire, clearly, was one of those. Glenrosa I've mentioned numerous times. There were two smaller fires. One was in Barnhartvale, which is near Kamloops. I lived in that area and know it well and know that that's a very challenging area from a firefighting perspective. And one was near Salmon Arm.

So there were four where there had been fuel-load reduction strategies implemented that were helpful to us, and we thought that it was easier to deal with those fires as a result. There were two in particular where fuel reduction strategies had not taken place, where had they taken place, it probably would have been helpful. Lillooet, the member pointed out already, was one of those, and the other was the Terrace Mountain fire.

[1055]

The Terrace Mountain fire is a little bit more complicated one, because the residences in that area are very spread out and very isolated. You have these large acreages, and that's where you get to the big numbers, around the 685,000 hectares, where you're maybe doing a fuel-load reduction strategy on a hundred hectares for a single residence. Not that you shouldn't do that. Maybe you should. I don't know. But again, it's where the numbers get a bit deceiving in terms of looking at very large numbers.

I will close off by saying that in Filmon…. Filmon was very clear that communities needed to establish, as a pri-
[ Page 4892 ]
ority, wildfire management protection and plans. It is a community-driven process that we definitely play a role in. We clearly play a role in it. We have presentations at UBCM every year. We assigned 16 staff this fall to go out and work with communities, specifically on the development of wildfire protection plans. So we have prioritized our work accordingly and had staff participate in that level of activity.

We've had some success. We had 20 communities complete wildfire protection plans this winter — so again, I think, some positive numbers. But as I mentioned to the member earlier, I think about 93 local governments have chosen not to even initiate a wildfire protection plan at this point. I don't know why they wouldn't want to do that — I just don't — because we have staff that will support that work. They don't need to do it off the side of their desk. The member opposite feels strongly about it, I feel strongly about it, and we all — everyone in this room, I'm sure — feel strongly about it. Yet there are 93 local communities that have chosen to not even start the development of a wildfire protection plan.

As we continue to see the impacts of climate change, even though a community may have felt safe historically, they may not feel safe in a very dry year. So Filmon, I think, made an effective point. This needs to be a locally driven initiative. The provincial government continues to fund, as the member opposite knows…. About $6 million remains in the fund for fuel reduction strategies for this year — in the UBCM fund. I suspect that will be exhausted this year, and we'll have to revisit that and decide what we need to do going forward on it. The fact that there remains $6 million in that fund says that it has been funded appropriately, at least to this point in time.

N. Macdonald: Just to wrap up on this. I know it's a piece that will continue to have our attention and have staff's attention. Much of what the minister says, I think, makes the case for more political leadership from the ministry in terms of…. You need the local involvement, but you obviously have a massive area that needs to be treated. That needs to be ongoing. Therefore, you need to prioritize communities rather than have the communities that organize themselves to access resources.

The minister has talked about many, many communities that likely need the work but haven't chosen to access any of the programs. So I think that there's a strong argument for the ministry taking the lead in terms of making sure that the communities are protected. Because after all, as a wildfire approaches, the province steps in and deals with the issue, and very often it is Crown land that we're talking about.

The member for Nechako Lakes had some interesting ideas around how community forests could be used. So I think it's a problem that still needs the attention of government, even if the wider public doesn't pay attention until it's in the midst of fire season.

I'm going to leave this topic because we're very limited for time. I'll turn it over to my colleague here, who is going to move into some First Nations issues.

B. Simpson: Just as a result of what little time we do have, I'm going to ask some specific questions about First Nations and then ask the minister to get a briefing on some of the others, because we are running out of time. Then I want to move into timber supply reviews that have occurred and canvass some mountain pine beetle issues before turning it back over to the critic. Again, if the minister can also be conscious of the time, I'll try hard to not pontificate on my side or ramble on my side, as the minister indicated yesterday.

FRAs and FROs — will they be renewed? I think that about half are coming up or are close to renewal, and this is a question out there. Is that a vehicle that the government is going to continue to use to give First Nations access to the land base?

[1100]

Hon. P. Bell: I'll try to not pontificate either, for the member opposite.

The member will recall that yesterday we introduced a piece of legislation that represents a new form of tenure opportunity for First Nations. We did consult with some First Nations groups in the province prior to introducing that. Obviously, not all 203 First Nations, but we did consult with some.

[H. Bloy in the chair.]

The feedback we got was positive from First Nations. The intent over time is to move First Nations away from the short-term, non-renewable FRO or FRA tenure into the renewable area-based tenure.

At the risk of pontificating for one moment, I will just say that that is likely to take quite some time. Some will be early adopters that hopefully we can move ahead very quickly on, but given that there are 203 First Nations around the province, many in areas where the timber supply is already oversubscribed, that will be challenging. But it is the priority of government, and as articulated yesterday in the legislation, I think we demonstrate that.

B. Simpson: As we've indicated over on this side on a number of occasions, we think there's a lot of work that the Ministry of Forests has on its plate, a lot of work that needs to be done. Some of this could be fast-tracked by actually retaining some of the staff and reassigning to work priorities — First Nations referrals. First Nations work, on moving them to a new licence, could be accelerated with more resources, and I think it's a fair use of resources, not withstanding the deficit.

For the folks at home — as the minister likes to say, as well, now — we are not allowed to discuss the legislation
[ Page 4893 ]
that will be in the big House when it comes up. We'll have our questions about that and look forward to that debate. Moving people to area-based tenure — we've had that discussion before — I think is the way we need to go. Even the ministry's own silviculture reports indicate that area-based tenures tend to be better managed, have more investment, and so on over time. So we're not opposed to that move, but it remains to be seen in the details of the bill.

First Nations Forestry Council — does that funding come from the Ministry of Forests and Range? I'm being told it won't be renewed this year.

Hon. P. Bell: The funding provided to the First Nations Forestry Council came from both the provincial government and the federal government at different times. We've been in discussions with the forestry council in terms of their role and working with us in the development of forest policy for, oh, probably getting close to a year now. I don't know if it's exactly a year but for quite some time.

We've not yet come to an agreement on what each party believes makes sense in terms of the First Nations Forestry Council role that would be played in provincial policy decisions, but we continue to do that work. There has been, I think, a coming together of views in the last number of months, so I'm hopeful that we will get to a positive conclusion there.

The First Nations Forestry Council had about $400,000 that was available to them that was carried over as part of their budget from the previous year. They had asked us to support them being allowed to spend that money as necessary for their ongoing work for the '10-11 budget year, and we did support that. My understanding is that they have sufficient funds to continue to operate for '10-11, and we continue to discuss what their role might look like into the future.

B. Simpson: I'd like to sit with the minister around the reconciliation agreements. I've spoken with the Minister of Aboriginal Relations, and I know there's going to be an announcement this week around those.

[1105]

One of the questions that's being asked — and the minister has already alluded to some of it — is the oversubscription of some land-based areas, and now you're going to layer First Nations access to more timber in the areas that may be constrained. I'd like to understand that a bit more, so I'd like to canvass the minister on that.

The final question just on First Nations — and this is the rapid-fire round in our discussions these days — is referrals. Will the Ministry of Forests offices continue to handle First Nations referrals and manage that? In particular, in areas where some of those offices are being closed, how will those referrals be managed? The minister must know that referrals are bogging down a lot of work — not just on forestry, on other areas — and more resources to facilitating the referral process are needed, not less. How will that be managed?

Hon. P. Bell: In an effort to keep things moving along in a speedy-like fashion, I will tell the member that, first of all, yes, the Ministry of Forests and Range will continue to do that work. The changes that were made in terms of staffing levels were done with that in mind, in terms of how that work has to be done and where it has to be done.

There is a cross-government strategy, the regional management coordination project, right now looking at how we can better manage referrals for all ministries instead, because oftentimes a First Nation may get a referral from three or four different ministries on a single project. That could involve a cutting permit, a gravel permit, a road permit, a water permit and maybe a lands permit. There are all of these different referrals that are about exactly the same issue. We think there are improvements to be made internally within our government that will allow those referrals to be done in a more efficient manner.

Additionally, the effort to engage in reconciliation agreements as well as strategic engagement agreements also establishes a different model of consultation and referrals. The Nanwakolas group would be an example of that. The Turning Point initiative and other initiatives are all examples of that, where governments and First Nations agree on a consultation framework and how those are managed. Which need to be just notifications for low-level decisions? Which need to have a full — and full engagement — around consultation and, potentially, accommodations if there are infringements? All of those things work together.

The notion of going to a strategic engagement agreement brings First Nations together in logical groups so that instead of issuing consultations to six or five or ten different First Nations, it's all done in a coordinated manner. All of those things come together. We acknowledge and recognize that we need to find better ways of doing business with First Nations, specifically around consultation and notifications, and that work is being done.

B. Simpson: I appreciate the minister clarifying that, and that's why I would like to understand reconciliation agreements a little bit more. There is a hierarchy, and it does appear that there's a bit of a clearinghouse there that may facilitate moving things forward. I know it's a high level of frustration among everybody, including not just the First Nations but including First Nations about the referrals process just now.

I need to move on in the continuation of rapid fire. One of the interesting things about the funding of the First Nations Forestry Council — and it may need to be
[ Page 4894 ]
nipped in the bud if the minister thinks that they're making some headway — is that it was happenstance that the First Nations Forestry Council used the Olympics as a platform to nail both the federal and provincial governments about the promise of money for mountain pine beetle. Now they're in negotiations for their funding, so some people are joining those two together and suggesting that you'd better not critique the government.

Two points of reference I want to put in front. I'm really gutting the questions around this, but one point of reference: is the First Nations Forestry Council reminding the government — particularly the federal government, in their case — of the billion-dollar promise for mountain pine beetle? It's a hundred million a year for ten years, and the best that we can track is that around $200 million of that came in some form to the province. Some of it was used, as I've argued in the House, to backfill Ministry of Forests line items that were cut previously, but they have made that claim.

[1110]

I also want to reference the mountain pine beetle action plan from 2006. It stated that for mountain pine beetle incremental silviculture activities alone — so that's not NSR, not satisfactorily restocked, accruing, not fire, not anything; it's just mountain pine beetle activities alone — the Ministry of Forests' own documentation pegged the advance silviculture measures that need to be undertaken at between $800 million and $1 billion for that work to be done.

So where are we at? Are there any discussions whatsoever with the federal government about a joint federal-provincial initiative, about some kind of renewal of the old forest range development agreements, something that will actually help us leverage dollars, utilize that promise that was out there and get the kind of order-of-magnitude response that we need to the mountain pine beetle issue alone?

Hon. P. Bell: There are, I think, two elements to the member's question. The first was the billion dollars from the federal government, and then the second was the number of hectares that needed to be treated and the activity in terms of incremental silviculture and the dead pine stands. Maybe they were combined together in the question, but for the purposes of the answer, I'm going to separate the answers into two elements.

In terms of the billion dollar fund, as the member may recall, the mountain pine beetle file was moved to the Ministry of Community Development a couple of years ago — maybe three years ago, I think, now. That is the lead ministry on the mountain pine beetle and the federal funding relationship that the member refers to.

I don't know whether the Community Development Ministry has had their estimates or not yet — I'm not sure — but if they haven't, then that would be a good opportunity for the member to bring those questions up. That minister would be much more capable of answering the question than I can.

In the second part of the question: "Okay, so there's this large area of mountain pine beetle that's been killed. What are you doing to bring those stands back into production, and what is the current prognosis?" The member points out that that report is a few years old now. Now, I can tell him that since 2005 there has been $160 million spent out of the Forests for Tomorrow program that included about 40 million seedlings this year.

[1115]

It continues to ramp up, and I think we're projecting about 18 million seedlings for this year. That's because we've shifted gears in terms of how we're managing that account. The gear, really, that we shifted was trying to get some value out of the stands that we're rehabilitating for biomass. Because of the expansion of the pellet industry and the bioenergy industry, we've been able to get some limited value out of those stands, reduce our overall costs and get more trees planted. That's been helpful.

Also, the member will recall — I think it was a little over a year ago or so — that we passed a regulation that allows us to direct licensees to assess secondary stand structure when they go into some of these stands that were killed by the mountain pine beetle.

What we're finding, and what wasn't taken into account in the report that the member refers to, is that there has been significant regeneration in stands that have not yet been harvested — mountain pine beetle stands. What we're finding in our assessment, depending on the location and the quality of the understorey, is that somewhere between 20 percent and 40 percent of the stands that have not yet been harvested have an understorey that would lead to a shorter end-rotation period for those hectares than if we went in and knocked that timber down and replanted the stands.

We've done a great deal of work through the chief forester's office on this particular analysis to determine where the point is where it makes sense for secondary stand structure to be left behind and to not harvest and damage, of course, the secondary stand structure, which is what would occur if you went into those stands.

I'm advised by the chief forester that, depending on the stand, in the member's area 20 percent to 40 percent of the stands have a secondary stand structure that would suggest you'll get a shorter rotation period and a better overall outcome by allowing that to continue to grow, as opposed to removing the dead wood, destroying this secondary stand structure that is there and replanting that stand.

B. Simpson: Well, the minister must know that of the $160 million that has been expended through Forests for Tomorrow, the vast majority of the first years of that work went to the Firestorm 2003 land base, not mountain pine beetle. I was asking about mountain pine beetle.
[ Page 4895 ]

Only a small amount of that started to make its way into mountain pine beetle stands and now some juvenile stand work. It's a minuscule amount relative to the order of magnitude that even the minister's own documentation says needs to be done. Second, community development has the project side of any residual federal money — building longer runways or hockey rinks.

I was asking about the land base. Surely the minister can't argue that we have a massive part of the forest, notwithstanding that there might be some immature…. There might be some secondary growth structure, but again, the chief forester indicates in his own report that there's a lot more work that we need to do in that. Relative to this year's cuts and budget cuts, there's more work that could be accelerated and that could be done, not cut, to make sure that we understand what's happening on that land base.

I'll take it as a "no" that we don't have, through the Ministry of Forests, discussions with the federal government about a further agreement of some kind where we're looking at an order of magnitude relative to the scale of the challenge that we have in front of us. The chief forester's own work points out that early intervention can shorten, across the board, our ability to get this forest back up into harvestable levels and that failure to intervene early will lengthen the time lag by 30 years. So an early intervention strategy, it seems to me, would be wise use of the public dollars in the largest public asset that we have.

I need to move on. In the timber supply reviews that just came out — I only have ten minutes left, so let me put something on the public record — I cannot understand the minister's response to the Wood Markets report. I have taken the timber supply reviews that have just been released for the Prince George area and for the Quesnel area, and I've lined it up with the wood products group. In some cases the timber supply — for example, in Quesnel — actually has a worse-case scenario than the wood products report does. In the case of the Prince George area it actually aligns quite reasonably. There's a time differential, but it's minuscule relative to what it is that we're actually addressing here.

[1120]

My question to the minister is this. Prior to the '09 election the minister was in the Quesnel area saying he was going to hold up the sky, that there was no need to worry in the Quesnel area, that we would actually have more mills, not less. We've had one mill virtually permanently closed since then. I'm expecting that announcement shortly. One mill that's down. The timber supply review indicates that we will only be able to sustain one sawmill.

Now that we have two new timber supply reviews for the core area of the mountain pine beetle, does the minister still contend that we're not going to lose any mills?

Hon. P. Bell: I just want to take a step back. I actually have a deal to make with the member. I will quit telling people that he suggests the sky is falling, and then I won't have to hold it up anymore. So if that's an acceptable end deal…. Perhaps that's an appropriate one for two people who share the same barber.

So some good questions. On the wood markets report, the member was asking to understand what my response was or why I suggested that the wood markets report took a narrow view of the array of outcomes that could take place in the coming couple of decades.

I guess it's based on a number of reasons. First of all, the wood markets report only presented one scenario of many scenarios that could take place going into the future. Certainly, the communication I've had with the chief forester has always been to say: "How do we mitigate the midterm timber supply risks that we have?" I will offer to the member that I do understand that Quesnel is the greatest at-risk area for all of the TSAs in the province.

[1125]

It is one of the areas where there isn't a quick, simple answer because of the 70 percent pine-leading stands that exist in the area and the level of attack that the pine beetle had through the Quesnel area.

There are many other areas in the province where the timber supply reviews indicate that we can mitigate a large portion of the midterm timber supply downfall. Quesnel is a priority area for us. That's why we've recently released the timber supply review and why we're looking for comment. But I need to add that even in the existing timber supply review, certainly, the thinking is that there are 12 years out in front of us before there is any significant risk to the TSA, so it does give us time to work through those challenges.

It is one of the ones that I take very seriously, and I want to assure the member that if he has thoughts or suggestions around the mitigation of that midterm timber supply that help to complement the opportunity for those mills through the midterm, I know that I and our chief forester would be eager to hear those.

Some of those things just even come out to: how do you portion out the non-pine stands over what period of time? What is the rotation period? Is there an opportunity…?

Earlier the member commented on the area-based tenures that we are considering for First Nations that will be debated in front of the Legislature and made the comment that in his experience the advanced silviculture practices are more likely to take place in area-based tenures than in volume-based tenures. Certainly, we agree with that suggestion and see that as an opportunity to help mitigate the midterm timber supply falldown.

Also, I think, as the wood markets report points out, it's a bit of a good-news, bad-news scenario. It also suggests that as the midterm timber supply starts to be
[ Page 4896 ]
impacted, which they're suggesting would take place in a much shorter period than we believe it will take place….

As that occurs, they're suggesting a significant increase in lumber prices globally as a result of that, being that the centre of the breadbasket, really, or a large portion of the lumber is shipped from mills in the mountain pine beetle–impacted areas. But as that happens, it will drive licensees to go further to acquire their timber, and they'll go into stands that currently we don't assess as viable for operations because of the lower levels of volume per hectare.

There are a whole bunch of things that take place, and I think that it's in everyone's best interest to ignore the sky altogether and stay focused on the trees. If we don't worry about the sky, then we can pay all of our attention to the trees that are on the ground.

The last thing I just wanted to respond to at this point for the member is…. The member asked about a FRDA-type program or something like that. Again, it would be the Ministry of Community Development that would lead those negotiations with the federal government, so it is something better canvassed under that ministry.

But I think lots of work needs to go on, and I think that we're all on the same page in terms of mitigating the midterm timber supply risks. We all acknowledge that Quesnel is the most at risk and needs the most work. Certainly, I think that our collective goal should be to do everything we can to mitigate those risks.

B. Simpson: The critic is reminding me I need to constrain my Glaswegian small-man syndrome here, because I am concerned about my community. The minister didn't answer the question about mill closures. I know that there are all kinds of mitigating factors, etc., but one of the things that the Wood Markets Group points out — one of the things that we're living with — and one thing that the timber supply analysis points out is that we cannot sustain the current infrastructure.

It takes time to change. I know that the minister is having some fun with the sky is falling thing, but it is a fundamental difference in approach to leadership.

I believe fundamentally that you embrace the reality, you get other people to embrace the reality, and then that unleashes the creativity that you need to resolve the problem. Avoiding the reality, boostering around the reality does not marshal the resources or the wherewithal or the creativity to actually go after the problem.

I am going to make a couple of comments here because I have to turn it back over to the critic. Here are some examples. I've had a discussion with the chief forester, and I appreciate the minister giving me access to some of the resources there. That has never been a problem, and I do appreciate that. But the fact is that we've got timber supply reviews out in the Prince George and Quesnel area with no juvenile stand impact factored in.

[1130]

It doesn't matter if the chief forester's got some modelling. Those are the public documents that are going out to the public, and they don't have juvenile impact factored in. They don't have other pests and diseases factored in. They don't have incremental fire factored in. All they have is modelling based on 80 percent or so impact of mature pine. It's a fallacy. The situation is actually worse than what the ministry is projecting, yet we've still got this referral to Community Development.

I'd sooner have a bunch of foresters in the Forest Service, who are charged with the responsibility to manage the public forest, talking to the federal government about what we need to do on the land base, not a bunch of people in Community Development.

That's the kind of stuff that we need to see in this budget. That's the kind of forward look that we need to see — not $161 million, of which 40 percent or 50 percent ended up in the hands of PricewaterhouseCoopers for administrative costs while they were cutting cheques to the Ministry of Forests and cutting cheques to the Ministry of Environment.

What the heck was that all about? Now it's going to be pulled back into the ministry. Well, it should have never gone out of the ministry in the first place. That's where there are fundamental disagreements. To put that all aside — I'm happy to do that, if we're going to embrace reality.

My challenge back to the minister, aside from going to get haircuts together — I do my own, by the way, as you can tell — and I've sort of personally done this, and I'll publicly do it to the minister, is let's get into Quesnel. Let's get some resources in front of that community and say: "Here's the reality we're dealing with. Here's what we know. Here's what we don't know. Here are some of the questions that we're going to have to grapple with. And here are some of the options available to us above and beyond the current discussion paper."

I'd like to sit with the minister and figure out what that looks like. I believe I'm elected to represent those people independent of political stripe, and wouldn't this be a good way to go and approach that community and try and figure out how we can actually get this in front of them in a way that they can embrace that reality and try and figure out what to do in the future? So I'll put that challenge in front of the minister.

One of the things that's really disappointing — again, the Ministry of Forests gave it up — is that they used to have a performance measure on community preparedness. That community preparedness performance measure was supposed to be 100 percent this year. It was supposed to be that 100 percent of the communities impacted by mountain pine beetle had community preparedness plans this year. Guess what. The performance measures disappeared. As far as I'm concerned, that's shameful.

I'm speaking as an MLA here for my own constituency. Would the minister agree to let's try and figure out
[ Page 4897 ]
how to use Quesnel — he's admitted that it's the worst-case scenario — to have some kind of futures forum there where we can engage people in a discussion of the future of that community?

Hon. P. Bell: I never really like to get into an argumentative thing in estimates, because I don't think it serves the purpose. However, I will exempt myself from the desire to avoid that in this particular situation.

[1135]

I will remind the member opposite that while he accuses me of being overly optimistic…. I accept that criticism. I acknowledge that there may be days I could be seen that way. However, I choose to live that way.

There's probably a happy balance between the two of us. Actually, I think I heard the member say something about a short man, and I'd just remind him that we're all the same height on TV anyway, so it's pretty well irrelevant. I use the same barber that the member opposite does — me. Well, he uses me on that side.

I will remind the member opposite of a statement he made on January 23, 2009, on CBC Daybreak, when he said: "The China strategy, when you look at the Chinese population and the potential that's there, at best will only take about 10 percent of B.C.'s productive capacity at its peak."

We've already exceeded that, as the member well knows, and it continues to grow at a very rapid pace. As well, on January 15, 2009, on the TLA progress panel discussion, the member opposite said: "I'm not sure that Mackenzie will be coming back." I would suggest to the member opposite that there's a somewhat different outlook, and now that the member….

Interjection.

Hon. P. Bell: I see I've touched a soft spot, and the member is starting to heckle now, which is always a good thing. It means that I've got his blood pressure moving back in the right direction.

However, all that said, the member asked a question, or a request, I should say, which was: will we engage actively in the community of Quesnel to look at all the options going forward in terms of timber supply, what might be available and what sorts of options are available? I am prepared to commit to that, and that will be done through the timber supply review, which is the current active work that's going on.

I've already had extensive discussions with the chief forester that I want exactly the type of work that the member opposite is describing, considering all of the options that are available and laying out all the potential scenarios. The community leaders like the member opposite and the mayor of Quesnel, who is very passionate about this, and the licensees in the area and individuals, workers — the United Steelworkers, who rely on these mills for their employment and their ability to stay in the community — can have their input and say that these are the things we think would be acceptable going forward, and these are the types of recommendations that we'd like to make.

I am certainly prepared to make that commitment to the member opposite, and I'm also prepared to commit to the member opposite that he will certainly have a key role to play in those discussions as one of the community leaders.

N. Macdonald: In the short time we have left, just to move into silviculture. Obviously, we've been talking about the mountain pine beetle. We've been talking about fire. Therefore, there's also the accumulated fire. What is the current non-satisfactorily restocked area, according to the Ministry of Forests?

Hon. P. Bell: Just a little bit of detail behind that, so the member understands the breakout of those numbers. The total NSR is 750,000 hectares. Of that, 510,000 hectares are considered operational NSR. That means ongoing stands that have been harvested, that are within the appropriate time window for restocking. They haven't hit the window where they are out of compliance. They're still in compliance. And 240,000 hectares of that is NSR that falls outside of that, that needs to be addressed in a different way.

[1140]

N. Macdonald: Just in the forest practices branch of the Forest Service, September 8, 2009, we have a figure that would include the small-scale salvage. It's a graph, so I think it's around 300,000, and then the mountain pine beetle is identified as a further 400,000. I think that works out to pretty close to 1.4 million hectares. Is that a number that the minister would contest, or is that an accurate representation of what needs to be done on the land?

Hon. P. Bell: The 700,000 hectares that the member is referring to have not been declared as NSR because they haven't been surveyed yet. We talked earlier about secondary structure in some of these stands, where we may or may not choose to go into those stands. Some of them are small-scale salvage stands. So while they are potentially NSR, they've not been declared that because they haven't been surveyed. Until we survey them, we don't know what percentage of those are actually sufficiently restocked as a result of whatever technique was used to harvest in the case of small-scale salvage.

I think the member knows that, generally, small-scale salvagers leave significant understorey behind. If he doesn't, I can tell him that they do, because I was one of them for a long time. Then the pine beetle volumes…. What we're not sure of is how many of those hectares have sufficient understorey.

The Chair: Member, and noting the hour.
[ Page 4898 ]

N. Macdonald: Okay, we've got a few minutes here. We'll try to stretch the time.

So you have this area. The question is: why would they not be surveyed? And how does it relate to the budgets available to the ministry?

Maybe just to pile in questions, has the ministry considered, as well, the fact that that NSR is likely growing? You have ongoing pest issues, disease issues. You have fire issues. It speaks to a massive gap in terms of the need. These are primarily, if not entirely, Crown obligations that we're talking about, so surely there'd be a curiosity about how much of the public lands sit not sufficiently restocked.

The Chair: Minister, noting the hour.

Hon. P. Bell: Thanks, Mr. Chair, and I'll need all of the budget votes, because I think…. Are we wrapping up at this point, or are we coming back this afternoon?

Interjection.

The Chair: They have to be quick.

Hon. P. Bell: Sure. I'll try and respond quickly to the two.

Why is the area not surveyed? A very large mountain pine beetle area. We do have a budget for a survey. We continue to do that survey.

Is it likely growing? Probably not in the central Interior — in the Quesnel, Williams Lake, Burns Lake areas. Perhaps in the south, with the exception of fire. So we don't know that, but certainly, the majority of the mountain pine beetle activity in the central Interior has run its course.

N. Macdonald: I'll put the two questions together. They're not linked. One of the points that we would make is…. Well, I believe strongly we should be investing far more heavily in the most valuable public asset that we have. Part of that is we're trying to understand the Forests for Tomorrow — the funding going forward. I know historically what the funding is. That's easy to find. But could the minister lay out the funding for Forests for Tomorrow into the years ahead?

[1145]

Then the next question is just a quick question I was asked to relate to the minister. Can the minister tell me how the ministry arrived at the figure of $20,000 given to the district of Kitimat to assist with their feasibility study, when other communities like Fort St. James and Mackenzie got upwards of $2 million in supports when their forest industry hit the crisis point? So those two questions, and I think that's likely as far as we get.

Hon. P. Bell: The budget on a go-forward basis is $42.4 million for Forests for Tomorrow, and it's not been reduced in future years.

Interjection.

Hon. P. Bell: Annually. That's the go-forward budget.

The second question — the $20,000 to Kitimat. It was $40,000, $20,000 from the Ministry of Forests and Range and $20,000 from Community Development. First of all, this is specific to an initiative in Kitimat around the employee purchase of the mill, so this is not a general broadcast.

The district of Kitimat-Stikine. I don't have the numbers right in front of me, and I don't want to take the time to pull them out because that'll dip into our time. If memory serves me correctly, about $5.5 million, through the same fund that Mackenzie got $2 million from, has gone to the district of Kitimat-Stikine, so it's been a substantial amount of money.

Mackenzie has self-administered the $2 million. The district of Kitimat-Stikine applied for individualized projects that have added up to $5½ million. So in actual fact, the district of Kitimat-Stikine has received a disproportionate share, relative, at least, to the Mackenzie scenario.

Also, Kitimat is a totally different issue than Mackenzie. It's a pulp mill versus an entire town. In Mackenzie there was nothing left in the community. Kitimat's got a large smelter that is still driving significant employment, so it's a totally different situation.

If the member wants to give me the….

The Chair: Please have a seat, Member. I'm going to call Vote 34.

Vote 34, ministry operations, $380,357,000 — approved.

Hon. P. Bell: I'll just remind the members opposite that it was the opposition that established the time frames for these discussions, not the government.

Vote 35, integrated land management bureau, $50,605,000 — approved.

Vote 36, direct fire, $51,720,000 — approved.

ESTIMATES:
OTHER APPROPRIATIONS

Vote 53: Forest Practices Board, $3,839,000 — approved.

Hon. P. Bell: I move that the committee rise and report completion of the Ministry of Forests and Range estimates.

Motion approved.

The committee rose at 11:49 a.m.

[ Return to: Legislative Assembly Home Page ]

Hansard Services publishes transcripts both in print and on the Internet.
Chamber debates are broadcast on television and webcast on the Internet.
Question Period podcasts are available on the Internet.

TV channel guide • Broadcast schedule

Copyright © 2010: British Columbia Hansard Services, Victoria, British Columbia, Canada

ISSN 1499-2175