2011 Legislative Session: Fourth 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)

Thursday, March 29, 2012

Morning Sitting

Volume 33, Number 6

ISSN 0709-1281 (Print)
ISSN 1499-2175 (Online)

THURSDAY, MARCH 29, 2012

The House met at 10:02 a.m.

[Mr. Speaker in the chair.]

Prayers.

Introductions by Members

L. Krog: I'm surprised to be doing this myself, but I'm doing it on behalf of the member for Saanich South this morning. Joining us in the gallery today are 14 students from St. Margaret's School, accompanied by their teacher Gregor Campbell. They're a class of law 12 students here for this morning to learn about democracy, and they'll have the pleasure of meeting with the member later this morning. Would the House please make them welcome.

Motions Without Notice

MEMBERSHIP OF SELECT STANDING
AND SPECIAL COMMITTEES

Hon. R. Coleman: By leave, I move:

[That the following changes to parliamentary committee membership be adopted:

• Eric Foster replace John van Dongen on the Select Standing Committee on Public Accounts and,

• Kash Heed replace Hon. John Yap on the Select Standing Committee on Public Accounts;

• Doug Horne replace Hon. John Yap on the Special Committee on Cosmetic Pesticides.]

Leave granted.

Motion approved.

Orders of the Day

Hon. R. Coleman: In this House we will continue committee stage debate on Bill 18, intituled the Advanced Education Statutes Amendment Act, 2011, and in Section A we will be doing the estimates of the Ministry of Environment, continued. If that should complete, we would move to the Ministry of Jobs, Tourism and Innovation.

[1005]

Tabling Documents

Mr. Speaker: Hon. Members, before we start committee stage, I do have a report that has to be tabled. I have the honour to present the Representative for Children and Youth special report, The Impact of Criminal Justice Funding Decisions on Children in B.C.

Committee of the Whole House

BILL 18 — ADVANCED EDUCATION
STATUTES AMENDMENT ACT, 2011

(continued)

The House in Committee of the Whole (Section B) on Bill 18; D. Black in the chair.

The committee met at 10:07 a.m.

On section 20 (continued).

M. Mungall: In section 20 we're looking at provisions that change who can represent staff and faculty on the board of governors. My questions were starting along the lines yesterday of how this breaks with a longstanding practice at many colleges and institutes where the representative for faculty or staff to the board of governors also has a position on the elected executive of that association to ensure that there is strong communication and a liaison role between the elected executive and therefore the members and the board of governors.

My question I don't feel was answered, so I will ask it again. Why has the ministry decided to break with that longstanding convention?

[1010]

Hon. N. Yamamoto: As we discussed yesterday, this provision guards against the conflict of interest that results if a faculty or staff member of the board is effectively representing both the institution and the union at the same time. As a participating member of the board, a faculty or staff member of the board is, effectively, representing both the institution and the union at the same time. As a participating member of the board, a faculty or a staff member would be in a position to be privy to information that may be a benefit to them personally and could in turn be used against the institution during negotiations concerning terms and conditions of service, salary and benefits.

Again, I remind the member opposite that we absolutely value the participation of faculty, staff and students on our board. All we are doing with this specific change is to make certain individuals of those groups — in this case, faculty and staff — ineligible to serve as chair.

M. Mungall: I'm wondering why the minister does not feel that existing codes of conduct and conflict-of-interest policies and bylaws are sufficient to address the conflict of interest. They are longstanding policies. They have done their job, unless the minister has an example of where they haven't. If she can either explain to this House…. Actually, if she could both explain to this House why the ministry does not feel that existing conflict-of-interest policies are sufficient, and could she provide an example
[ Page 10542 ]
of where that has been the case?

The Chair: I'd just ask members…. Some members are indicating they're having difficulty hearing the speaker, so I would ask people who are visiting to maybe take their visiting outside the chamber.

Hon. N. Yamamoto: I should actually correct for the record that in my previous response I was indicating eligibility to sit as chair, and we've passed that section. We're now talking about the ineligibility of members to sit on the board. I'm sorry for that confusion.

Again, I believe that the member opposite has heard yesterday the differences of opinions that we both have, and regrettably, I don't think that we will agree. We are looking at just a few individuals that represent either faculty or staff, who have responsibility as part of their voting executive and who may be in a situation where they are determining either a disciplinary action or terms of their employment with the institution.

I believe we fundamentally don't agree that a person who is in those positions can serve in the best interests of the institution.

M. Mungall: My question isn't whether or not we agree. I mean, clearly we don't. I'm wondering why the minister has come to the position that she has, to result in this disagreement. Again my question is if she can allude or enlighten this House of why she thinks that the codes of conduct and the conflict-of-interest policies and bylaws that exist at Camosun College, College of New Caledonia, College of the Rockies, Selkirk College, North Island College, Northwest Community College, Northern Lights College, BCIT, the Justice Institute, the Nicola Valley Institute of Technology…. The list goes on.

I apologize to anybody who's watching if I've left out their institution. The point is that all of these institutions have codes of conduct, and they have conflict-of-interest policies. The minister says that she's trying to address those issues. My question, then, is: why does she think those policies and bylaws are not sufficient, and can she provide an example that highlights her rationale?

[1015]

Hon. N. Yamamoto: The member opposite is correct. There are codes of conduct and conflict-of-interest guidelines at some of our institutions — in fact, probably most of them. They do vary from institution to institution. Regrettably, there have been cases where there have been breaches of codes of conduct or conflicts of interest and there hasn't been a removal or a recognition of that member from discussions of the board.

However, what this change is attempting to do is to really prevent a clear conflict of interest from arising at the outset — in the situation where a board member is already inherently in a conflict of interest, to prevent them from actually being put into that position. What we are doing is considered to be a best practice and good governance.

M. Mungall: I'm just wondering, then, if the minister can provide a clear example of where someone who is in a negotiating position on a union has ignored the conflict-of-interest bylaws or policies at an institution and of what was done within that institution to rectify that that shows that it was insufficient and that something like this would be necessary.

[1020]

Hon. N. Yamamoto: We have received concerns from boards from time to time — frankly, not that often. But because these issues involve individuals and, in some cases, these situations haven't been resolved, I don't really think it's appropriate to bring up specific examples in the House.

V. Huntington: I'm really disappointed to hear that reply. I have a great deal of difficulty with this section and sections to follow that are similar.

I believe that this is a discriminatory section. It prevents entire classes of individuals from running for or being appointed to boards on their institutions. It pronounces guilt before somebody is even asked to prove their innocence. I just feel that the government is making a serious and grave error and perhaps putting itself in jeopardy in terms of a discriminatory piece of legislation.

Boards are governed properly by certain governance principles that that board is trained and taught to understand. There are many, many rules, associations, consultants who will train boards and develop terms of governance for boards. If the government really wants to ensure that a board is operating effectively, then it will ensure that those governance principles are in place. It will not discriminate against entire classes of people.

Why wouldn't the minister, instead of the discriminatory provisions in section 59, ensure that in this piece of legislation strong governance principles are put in place that require boards to operate in certain manners? If conflict-of-interest guidelines are not present in certain boards, then they ought to be, and that's what the minister should be going after — not people who have no opportunity to serve their institution because they've already been deemed guilty of a conflict.

I would have suggested that under section 9.1 the chair should perhaps be appointed by the government if it is, in fact, afraid that a chair elected by members of the board that are appointed already by the government isn't able to control his own board. There are other ways of doing this without discriminating against a class of citizen, and I would like a response from the minister on whether or not the government has considered those other provisions and whether they have looked at the discrimina-
[ Page 10543 ]
tory provision.

[1025]

Hon. N. Yamamoto: The member opposite may not have been listening to the riveting discussion yesterday, so I'll just remind the member opposite that there are actually many other jurisdictions in Canada that also provide for these criteria for eligibility on boards of post-secondary institutions. This is not unusual, and in fact it does not discriminate against an entire class of people, as the member opposite suggested.

This only affects a few individuals who have a position on the executive and are involved with bargaining terms of their employment or are members who adjudicate disputes of their own membership. Again, it does not discriminate against an entire class of people. In fact, I'll say it again: the faculty and staff are very valuable participants on boards.

For the member opposite, to put this in context, at perhaps a university like SFU where they've got over a thousand faculty, there would probably be less than half a dozen faculty members that would in fact be excluded or made ineligible to sit on the board with this amendment.

V. Huntington: I wonder if the minister could tell us why they didn't choose to strengthen the governance provisions rather than take what I think is a pretty heavy step in terms of denying opportunity to serve on a board.

Hon. N. Yamamoto: This section is intended to prevent a clear conflict of interest from occurring at the outset.

V. Huntington: How could one determine a conflict of interest at the outset if you don't give somebody an opportunity to withdraw themselves during issues that are clearly a conflict?

Hon. N. Yamamoto: I have served on a post-secondary institution board, and I can tell you that a lot of the discussion, if not most of the discussion, is financial in nature and in fact would have direct consequences to the employment circumstances of an individual.

Members of the faculty who would like to serve on the board have a choice of whether or not they would like to give up their responsibilities, perhaps on the bargaining team of their union association, if that is something they wish to pursue. What we're doing here is identifying from the outset inherent conflict of interest that currently exists.

[1030]

M. Mungall: I think it's very interesting, because there's a little bit of jurisprudence on a similar issue around students being able to be a part of board decisions around tuition. Students are able to sit on the board, and they're not considered in a conflict of interest to address a myriad of financial issues, including setting tuition rates. Why does that logic, therefore, not apply to staff or faculty representatives sitting on the board?

Hon. N. Yamamoto: This specific section deals with the conflict of interest that a board member may have, but it is really dealing with the fact that it would be a member of the faculty who is actively involved in negotiating the terms of their employment. That condition does not exist for students.

M. Mungall: The thing is that there's jurisprudence that shows that students are not in conflict of interest to sit on the board and discuss any financial issue, including that of setting tuition rates, even though they are directly impacted financially by those tuition rates. They are the ones that have to pay them. It has been determined within the legal framework of our society that that is perfectly acceptable — for them to sit on the board and be involved in that decision-making.

When it comes to staff and faculty, the minister said that this is about conflict of interest and that this is to ensure that the staff and faculty are not involved in any financial decision, because any of those financial decisions will impact the bargaining decisions that may be made.

I just see two parallels here, where case law has determined that students are allowed to sit on the board and be involved in decisions that are financial in nature. It will, ultimately, impact…. Any one of those can impact their tuition rates.

Here we have faculty and staff sitting on the board, addressing financial matters, any one of which may impact decisions that might happen at the bargaining table. But somehow the minister has decided that this one with faculty and staff members is not acceptable.

Now, no one is suggesting that board members who are faculty and staff representatives and who are on the bargaining team play a dual role in that bargaining. There are conflict-of-interest policies that are already in place at every single institution that address that very thing. Perhaps that's why the minister hasn't gone there in terms of her arguments.

She mentioned all of these financial issues, and there's just no logic behind that. I'm wondering where she's pulling this from.

[1035]

Hon. N. Yamamoto: I guess where we perhaps disagree and may not ever see eye to eye on this…. A key responsibility of a board is to manage the employment contract of the faculty and staff. That's what this section is dealing with. It's not parallel to a condition with the involvement of students on a board.

Again, I would remind the member opposite that faculty and staff are absolutely valued on boards of our
[ Page 10544 ]
post-secondary institutions. We are simply eliminating the inherent conflict of interest for those faculty or staff members who are in a bargaining position — bargaining or negotiating the terms of their contract, actively doing that — and serving on the board.

M. Mungall: First, I would like to address the statement where the minister is saying that students, staff and faculty — particularly, with this clause, staff and faculty — are valued members of the board. They certainly do not feel that the government considers them valued at all. That has been clear in the various public statements and press releases and meetings that they've had with both the minister and me. They do not feel valued by this direction that the minister has chosen to take. Rather, they feel quite discriminated against.

Words are one thing; actions are another. We've already identified that the staff and faculty, as well as students, have every right to feel justified in that way, because we know from this back-and-forth here….

It's not about trying to make the minister agree. This is about accountability and ensuring that we understand, that the public understands, what the rationale for each one of these clauses is. What we've learned is that the rationale for these clauses does not include any specific concerns with conflict-of-interest policies or code-of-conduct policies at institutions.

The minister even said that there might be examples. She doesn't want to speak to them. She did say, however, that those examples where those policies have not been respected had been resolved in some way, so clearly, those policies actually are working.

We have working policies that already exist, that already address the so-called problems that the minister is trying to address with this. We have identified that several of the things in this bill are redundant, when we go back to section 18 and we talk about the best interests of the institutes and that people must work in those best interests.

What we have here is something that targets a very specific group of people to not participate on the board of governors. This breaks a longstanding convention not just in this province but in this country. The only conclusion — and I'll ask the minister if she agrees with this conclusion — that can be made here is that this is a direct attack on people who happen to be in a union.

Section 20 approved on division.

The Chair: Yesterday section 19 was stood down, and I understand that members of the committee are prepared to proceed now with section 19.

On section 19 (continued).

Hon. N. Yamamoto: Hon. Chair, I move the amendment to section 19 that is in the possession of the Clerk.

[SECTION 19, by deleting the text shown as struck out and adding the text shown as underlined:

19 Section 11 is amended by adding the following subsection:

(3) Despite subsections (1) and (2), the The Lieutenant Governor in Council may, on a resolution passed by the vote of at least a 2/3 majority of the members of the board,

(a) despite subsections (1) and (2), remove from office a member of the board elected under section 9 (1) (b), (c) or (d),

(b) remove from office a member of the board appointed under section 9 (1) (a), and

(c) remove from office a member of the board of the Justice Institute of British Columbia appointed under section 9 (2) (a)

if the board or the board of the Justice Institute of British Columbia, as applicable, is satisfied that the person should be removed for cause.]

[1040]

On the amendment.

M. Mungall: The minister has changed section 19 to only allow those who are elected to the board to be removed by a two-thirds majority, to now include all members of the board, including those that are appointed by government, to be removed by a two-thirds majority. If she can please just explain for the record why the ministry has chosen to expand those who can be removed from the board.

Hon. N. Yamamoto: Prior to this amendment there was always an ability to remove an appointed member from the board. The amendment now, the original amendment, was presented to allow the provision for an elected member to be removed by a two-thirds vote of the board. That is still actually only a recommendation. It will still have to go to the minister.

What we are doing is making it consistent so that the appointed members now, as well, can be removed by the same majority. This was actually done in consultation with some organizations that felt this would level the playing field and make things more consistent.

Amendment approved.

On section 19 as amended.

M. Mungall: This section continues to say that the board can remove, by two-thirds majority vote, any of its members now "for cause." I am wondering if the minister can elaborate on what cause would be.

Hon. N. Yamamoto: I'll just correct for the record. The member opposite said that this provision allows a board to remove a member. In fact, that's not what occurs. It's a recommendation to remove. The board does not have that authority, but they can recommend.
[ Page 10545 ]

They can be recommended for removal because of their conduct, such as a conviction for a criminal offence or by reason of a conflict of interest that compromises the member's ability to put the interests of the institution foremost.

M. Mungall: I'm just wondering if the minister has taken note that two-thirds majority of the board who recommends removal…. It very rare that the Lieutenant-Governor-in-Council would not follow that recommendation. Is she aware that the two-thirds majority, in almost all cases of the colleges and institutes that are regulated by this act, are appointed by the government?

[1045]

Hon. N. Yamamoto: It is possible that the Lieutenant-Governor-in-Council may not agree with the majority of the board, in which case the member would not be removed from the board. Having said that, the board would act, I'm sure, collectively to make this decision, regardless of whether or not they are appointed or elected members and in fact would expect that there is some independence and critical thinking and responsibility that each board member would have to make this decision.

M. Mungall: The minister speaks of an ideal situation, but there are all kinds of possibilities in life. One of them is the fact that in most colleges and institutes — I think actually all — a two-thirds majority of the board is appointed by government. The concern could be that in any situation….

What, for instance, the Federation of Post-Secondary Educators is worried about, which is directly impacted by this section…. They are worried that any one of their members who is representing their organization on the board might be bullied by those members who have been appointed — by a Liberal government, for example — and then essentially thrown off of the board and that recommended to the Lieutenant-Governor-Council.

If the minister has an example where the Lieutenant-Governor-in-Council has not followed one of these recommendations, I would be very interested to hear that. More importantly, how does the minister not see the fact that two-thirds majority of the board are her government's appointees? It gives them a greater deal of power in terms of controlling the board. They always will have a threatening card of saying, "Well, we'll kick you off if you don't agree with us," to those who have been elected. How does she not see that?

Hon. N. Yamamoto: There has been no example where a board has recommended a removal of a board member. That situation has not ever occurred because we have never had that provision. To answer that question, I think that's clear.

[1050]

I would remind the member — and we discussed this in a previous section when we spoke about the best interests of the institution — that when a board member is selected for the board, whether they're appointed or whether they're elected to the board, they are there to act in the best interests of the institution. This is fundamental to the section on the best-interests clause.

That's one of the reasons why we put that clause in there — to strengthen the board members and the behaviour that is expected of them in terms of good governance. A member cannot be removed by two-thirds of the board for just any reason.

M. Mungall: The minister says that a member cannot be removed for just any reason, yet we have the situation in this section that all we have is "removed for cause." The minister gave an example of cause, but that's not going to be an exhaustive list — those examples. Of course, the situation is that anybody, the two-thirds majority….

If a terrible situation should arise where the collegial relationship that has existed at institutions for several decades somehow dissolves and the elected members are perhaps in disagreement with those who are appointed by government…. Those who are appointed by government are in the majority. They can determine, for whatever cause they find sufficient, to remove those elected members.

The concern here is that that ability will be used in an inappropriate manner, and there is no way to address that possible situation within the legislation that the minister has put forward. How can the minister not see this?

Hon. N. Yamamoto: To guard against this being used inappropriately, this provision has the ultimate decision that is made with respect to the removal of a board member that is not acting in the best interests of the institution. That authority is left with the Lieutenant-Governor-in-Council. That position has the authority to make the final decision.

If the member opposite is questioning the integrity of that position, then I don't know what I can do to convince the member opposite that we have, on this side of the House, ultimate respect for the decision-making of this position and, in fact, a position of the Crown.

M. Mungall: Madam Chair, please let me clarify for the record that I am in no way questioning the integrity of the Lieutenant-Governor-in-Council — in no way whatsoever. What I am questioning is process. What I am questioning is how things actually happen in practice, in real life.

If the minister could then alleviate any concerns in this House that the Lieutenant-Governor will ensure that no member is removed from a board of governors without a fair cause, I would happily accept any examples she can provide of all the boards where there are govern-
[ Page 10546 ]
ment appointees where there has been an example of the Lieutenant-Governor refusing to remove or perhaps appoint an individual because they didn't feel that it was in the best interests of the public.

Hon. N. Yamamoto: I missed the question, or I didn't quite capture the intent of the member opposite's question. If she could repeat.

[1055]

M. Mungall: Just to clarify, the Lieutenant-Governor-in-Council is cabinet, and I do not want to question the integrity of the institution of cabinet. That is an important institution that exists in our political system. However, it is made up of people, and in our system they are partisan.

I am wondering if the minister has an example where the Lieutenant-Governor-in-Council — i.e., cabinet — has objected to a recommendation from a board to which it appoints members.

Hon. N. Yamamoto: I'm not sure that this line of questioning is applicable to this section. I'm at a loss to respond to the member's question.

The Chair: Member for Nelson-Creston on 19 as amended.

M. Mungall: Yes. In 19 as amended it's saying that the Lieutenant-Governor-in-Council, on a resolution passed by the vote of at least a two-thirds majority of the members of the board, can remove any of the board members.

My question. The minister said that the Lieutenant-Governor-in-Council, cabinet, will always make sure that, for whatever reason an individual might have been removed from a board, it is a just reason and it is done in the public interest and it is done in the best interests of the institution.

But we have to look at practice. Has cabinet, the Lieutenant-Governor-in-Council, ever rejected a recommendation coming from a board where that recommendation is to remove a member of the board that's been appointed by government?

Hon. N. Yamamoto: Currently there aren't any provisions to allow for a board to make a recommendation to the Lieutenant-Governor-in-Council. There isn't a provision for boards to recommend a removal to the Lieutenant-Governor-in-Council. Is that what I said the first time? Yeah.

M. Mungall: Just to be sure that I heard the minister right. If there is a provision for the Lieutenant-Governor-in-Council to remove board members, has there been an instance where the Lieutenant-Governor-in-Council has done so based on the recommendation of that board?

[1100]

[L. Reid in the chair.]

Hon. N. Yamamoto: I'm not aware of any situations where that may have occurred.

Section 19 as amended approved on division.

Sections 21 to 32 inclusive approved.

On section 33.

Hon. N. Yamamoto: I move the amendment to section 33 that is in the possession of the Clerk.

The Chair: Hon. Members, for clarification, the practice is to vote against the section when the amendment is to delete the section.

Section 33 negatived.

On section 34.

Hon. N. Yamamoto: I move the amendment to section 34 that is in the possession of the Clerk.

[SECTION 34, by adding the text shown as underlined:

34 Section 7 is amended by adding the following subsection:

(4) Despite section 6, the Lieutenant Governor in Council may, on a resolution passed by the vote of at least a 2/3 majority of the members of the board, remove from office a member of the board

(a) elected under section 5 (b), (d) or (e), or

(b) appointed under section 5 (c)

if the board is satisfied that the person should be removed for cause.]

On the amendment.

M. Mungall: This amendment changes…. Similar to what we were just discussing for colleges and institutes, it does this for Royal Roads University. If the minister can just explain the rationale, again, for making this change so that a board under a two-thirds majority vote is able to recommend removal of any one of its members.

Hon. N. Yamamoto: This is really for consistency. It's the same rationale with respect to a previous section that we discussed. It extends the application of the removal clause to members of the Royal Roads University board appointed by the Lieutenant-Governor-in-Council in addition to the elected members of the board who were already addressed in section 34.

Amendment approved.

On section 34 as amended.
[ Page 10547 ]

M. Mungall: I want to make sure that there are a few questions on the record about this. We have canvassed this type of issue for colleges and institutes, but here we have it again for Royal Roads University.

What we have is a change that the minister has acknowledged has not existed previously for Royal Roads University and that gives the power to a two-thirds majority of the members of the board to vote any of the members off in terms of recommending it to the Lieutenant-Governor-in-Council, which is the cabinet.

[1105]

Again, I will ask the minister if she is aware that a two-thirds majority of the board are the appointed members. Does she not see that this could create a considerable problem in the future should there ever be a conflict between those members who are appointed by government and those who are elected by students, staff and faculty?

That, as faculty associations, staff associations and student associations have pointed out, puts them in a position of a minority and, therefore, open to possible bullying or some type of mechanism where they can be threatened to vote a particular way, as otherwise they will be removed for whatever cause that board might define as justifiable.

Hon. N. Yamamoto: Again, I'll remind the member opposite that we expect board members to act in the best interests of the institution. Regardless of whether they're appointed or elected members, good governance would suggest that we have a provision for removing a board member who is simply not able to act in the best interests of the institution. This provision allows for board members, regardless of whether they're appointed or elected, to pass a resolution to remove a board member with cause.

Section 34 as amended approved on division.

Sections 35 to 45 inclusive approved.

On section 45.1.

Hon. N. Yamamoto: I move the amendment section 45.1 that is in the possession of the Clerk.

[SECTION 45.1, by adding the following heading and section:

Thompson Rivers University Act

45.1 Section 4 (1) of the Thompson Rivers University Act, S.B.C. 2005, c. 17, is amended by striking out "19, 20" and substituting "19, 19.1, 19.2, 20".]

On the amendment.

Hon. N. Yamamoto: This corrects an unintentional drafting oversight due to the section numbering applied to the best-interests clause.

Amendment approved.

Section 45.1 approved.

Section 46 approved.

On section 47.

Hon. N. Yamamoto: I move the amendment to section 47 that is in the possession of the Clerk.

[SECTION 47, by adding the text shown as underlined:

47 The University Act, R.S.B.C. 1996, c. 468, is amended by adding the following sections:

Best interests of university

19.1 The members of the board of a university must act in the best interests of the university.

Board chair

19.2 (1) The members of the board of a university, other than the University of British Columbia, must elect a chair from among the 8 members of the board appointed under section 19 (1) (d).

(2) The members of the board of the University of British Columbia must elect a chair from among the 11 members of the board appointed under section 19 (2) (e).]

On the amendment.

M. Mungall: My understanding is that universities already have policies which determine that the chair of the board of governors must be elected from those members who serve from the public so, therefore, are appointed by government. Is that correct?

[1110]

Hon. N. Yamamoto: This has been more of a practice at our universities that has been adopted over the years. What we're doing is applying some consistency to the act so that the University Act is consistent with the College and Institute Act. I'll suggest that this has been more of a practice, and a good practice, amongst our universities because they recognize that this is, in fact, good governance.

M. Mungall: The situation here, though, is that whether it's a practice or not.... So if they don't have policies…. Perhaps the reason that they don't have policies on this is because a situation may arise in the future where the best person to chair the board might be the representative on the board of governors from students, staff or faculty. They have left themselves open to that possibility.

If they do not have a specific policy, then it leads me to believe that there's a reason why they do not have that policy. I'm wondering why the minister, then, has decided to go this route in terms of again excluding certain members from sitting as chair of the board.

Hon. N. Yamamoto: Again, this is the same discussion that we had previously when we discussed the amendments to the College and Institute Act. It is the same rationale. We believe that the chair should be se-
[ Page 10548 ]
lected from a community and not a specific faculty, staff or student group.

M. Mungall: Why is the minister choosing to discriminate against students, staff and faculty, determining that they are not able to serve in the best interests of the university as a chair?

Hon. N. Yamamoto: This section is included in the act in order to make clear that the board members must individually and collectively uphold the best interests of the university at all times and that members' personal interests and the interests of any other community that it may be affiliated with cannot override the interests of the institution. Such provisions are commonplace in the legislation applicable to post-secondary boards elsewhere in Canada and, again, are reflective of the good governance and accountability that's expected.

M. Mungall: Well, yesterday I did ask many times, when it came to colleges and institutes in a previous section of this bill, how it is that it has been determined that this is a best practice — to specifically, definitively exclude specific people from sitting as chair of the board. How has the minister come to this conclusion that that is a best practice?

[1115]

The Chair: Hon. Members, with your indulgence I'd like to take this moment to welcome to the gallery a young man, Deacon Jones, studying political science. He has joined us. Thank you so very much. Please welcome him.

Hon. N. Yamamoto: Universities have obviously come to that same conclusion, our conclusion, on their own. As the member opposite has already indicated, their chairs have always come from the broader community.

There are examples of other jurisdictions in Canada that have legislation that mirrors this. That would include Alberta, Saskatchewan, I believe Manitoba and a couple of other provinces.

M. Mungall: I started this line of questioning by asking whether or not universities already have policies in place for this type of provision that excludes certain people from sitting as chair on their board. The minister said: "No, it's a practice."

If it's only a practice, then I'm left to conclude and the public is left to conclude that universities for some reason have identified that they need to be left open to the possibility that a student, staff or faculty member from their board may be the right person for the chair position. If they have left themselves open and here we have a minister saying, "Oh no, the best practice is to specifically exclude, definitively exclude via legislation," I want to know and the public wants to know how she has come to that conclusion.

Hon. N. Yamamoto: I beg to disagree. I believe that the universities, because of their common practice to select chairs from the broader community as opposed to specific groups with specific interests within the university such as faculty, staff and students…. It has been a practice because, in fact, it's good governance to do so.

M. Mungall: I am talking about specifically, via legislation in writing or via a policy in writing, excluding a group of people who sit on the board from being able to sit in the chair position on that board.

The minister has come to the conclusion that it is a best practice. Clearly, she either has evidence to show that's the case, or she does not. I'm of the belief, at this point, that she does not have any evidence whatsoever to have come to this conclusion that this is the best practice in good governance.

What we have is a longstanding tradition at universities that the chair — and this is the same for colleges and institutes, and you have to admit that — does come from one of the appointed members, a member of the public. Fair enough. But they have never gone to the step that this government is taking, which is to specifically discriminate against students, staff and faculty — to have come to the conclusion that if they are in the chair role, they are completely unable to act in the best interest of the institution.

The institutions haven't come to this conclusion. The minister, however, has. She has not shared with this House how she came to that conclusion. She goes to tradition in her argument. I've also asked her that if she's not willing to break this tradition, in terms of ensuring that it's always a member of the public, then why is she willing to break a tradition of ensuring that the person who is representing staff and faculty on a board of governors cannot also be on the elected executive of the staff and faculty association.

[1120]

She's breaking tradition there. Here, rather, she's putting a tradition explicitly into legislation so that there is no possibility to ever do differently in case that possibility arises, and that's what institutions have left themselves open to, for whatever reason.

If the minister can't say how she has come to this conclusion — that this is a best practice, that what she's proposing is a best practice — can she say who has asked her to do this?

Hon. N. Yamamoto: I'll remind the member opposite that this best practice of selecting a chair from appointed members from the broader community is one of a suite of improvements that we are changing, suggesting to be changed, to improve governance.
[ Page 10549 ]

Perhaps I'll remind the member opposite of a report that was commissioned by the former NDP government that recommended that faculty and staff and students should be part of boards. It did go on to conclude, however, that they did not recommend that the chair be elected from that group of people but rather from just the appointed people to, again, follow a good governance practice that is recognized in many other areas in Canada.

M. Mungall: Again on the amendment, I'm well aware of the report that the minister has brought up here. She brought it up in the past. I think it's important to note that the government of the day chose not to go with that recommendation because it didn't fall in line with practices. It excluded a very specific group of people from serving as chair, and that might not be in the best interests of the university at some point into the future.

That's what we have to do. We have to think long term when we're putting forward legislation. That is what they did in 1994, and I applaud the government of the day who did that. I wasn't even in university yet at that time. Good on them for doing that.

Here we have a minister who is changing an existing practice, who is changing the way things are being done. She keeps saying that there's a best practice, has not given us any evidence to why we should call this a best practice other than that it's done in other jurisdictions. Well, if your friend jumped off a bridge, Madam Chair, would you as well? No. I mean, this is an age-old thing that your mom asks you.

Here we are in this same type of logical framework. Just because Alberta and Saskatchewan are doing it is not sufficient to say that we should do it here in British Columbia. Rather, we need to have evidence as to why this is the way to go; why this is somehow deemed good governance by this government; why this is somehow deemed a best practice, even though universities do not have a written policy that specifically excludes three groups of people from acting as chair on their board. Universities clearly are not of the opinion that just because a student, staff or faculty is serving as chair, they're no longer able to serve in the best interests of the university.

Does the minister not see this as discrimination?

Hon. N. Yamamoto: No.

Amendment approved on division.

Section 47 as amended approved on division.

On section 48.

[1125]

Hon. N. Yamamoto: Hon. Chair, I move the amendment to section 48 that is in the possession of the Clerk.

The Chair: Hon. Members, this is a deletion, so the practice in this House is that we vote against that section.

Section 48 negatived.

On section 49.

Hon. N. Yamamoto: I move the amendment to section 49 that's in the possession of the Clerk.

[SECTION 49, by adding the text shown as underlined:

49 Section 22 is amended by adding the following subsection:

(1.1) Despite section 19, the Lieutenant Governor in Council may, on a resolution passed by the vote of at least a 2/3 majority of the members of the board, remove from office a member of the board

(a) elected under section 19 (1) (c), (e) or (f) or (2) (c), (d), (f), (g), (h) or (i), or

(b) appointed under section 19 (1) (d) or (2) (e)

if the board is satisfied that the person should be removed for cause.]

On the amendment.

M. Mungall: Again, this amendment seeks to broaden the powers of the board of governors at universities to, by two-thirds majority vote, recommend removal of any of the members, not just those who have been elected to the board of governors. I'm wondering if the minister, just for the record, can again explain why they have chosen to include all members of the board to be under this possibility of recommended removal.

Hon. N. Yamamoto: The amendment to section 22 of the University Act here introduced extends the application of the removal clause to members of the board appointed by the Lieutenant-Governor-in-Council, in addition to the elected members of the board who are already addressed in section 22. Again, what we are attempting to do here is to ensure that the appointed members and the elected members are treated consistently.

Amendment approved.

On section 49 as amended.

M. Mungall: Again, we have a similar situation. We've canvassed this previously, but I will ask the minister again: does she not see this as a possible opportunity for a majority of the board, which is all of the appointed members of the board, to hold a position of undue authority over those who are elected, because they by definition have a two-thirds majority of the board and could work together to recommend removal of any one of the elected members for any cause that they deemed fit?

Hon. N. Yamamoto: That is exactly why we added a best-interests clause into these amendments. When a member is appointed or elected, we expect the members
[ Page 10550 ]
to act in the best interests of the institution. This is fundamental to these changes in this legislation, and we also expect that each individual board member will have the ability to critically think, analyze and act independently — not, as the member suggests, as a group.

M. Mungall: Well, I've already stated my views on whether or not the minister's ideal situation is applicable to every situation, and in fact I'm not alone in that view. The Confederation of University Faculty Associations of B.C. this morning at 10 a.m. put this up on their website. This is what they have to say about this entire bill, including this section: "Bill 18 provides the government appointees on the boards with the tools to bully and intimidate the elected members of boards who stand up for high-quality education in the face of administrative and fiscal expediency."

That's what they have to say about this amendment. What does the minister think about what the Confederation of University Faculty Associations has to say?

[1130]

Hon. N. Yamamoto: When the Lieutenant-Governor-in-Council makes appointments to boards, we expect, the public expects, that these individuals will conduct themselves in a manner reflecting the highest standards of integrity and conduct. We expect no less.

M. Mungall: The key here, though, is that we expect people to act with the highest integrity, we expect people to always act within the best interests of the university, and we expect people to always have a strong collegial relationship when they serve on the board. For the most part, probably 99 percent of the time, those expectations are met. Sometimes they are not.

That's why in our society we have a variety of laws to address situations when those expectations are not met. That's why, for example, many organizations have sexual harassment policies or harassment policies, codes of conduct and conflict of interest. Universities have all of these. We've addressed — and likely will again in the next section — why those policies have done a sufficient job in the past.

But the provision in this situation that would result from section 49 of this bill puts the elected members on a board…. It changes how things have operated in the past, and it puts them in a vulnerable position should they happen to disagree with all those who have been appointed. It puts them in a highly vulnerable position. Does the minister not see this?

Hon. N. Yamamoto: I'll repeat for the member opposite again. Our expectation for board members, whether they're appointed or elected, is that they conduct themselves with the highest standards and act with integrity. What this amendment is doing, what the changes in our legislation are doing, is to increase the standards, to raise overall the governance standards in our institutions. In this respect it's the universities. What we are doing is enabling the boards to function well, and that's what the public expects us to do.

Section 49 as amended approved on division.

[1135]

On section 50.

Hon. N. Yamamoto: I move the amendment to section 50.1 that is in the possession of the Clerk.

M. Mungall: Just a point of clarification. If the minister can just…. I had a briefing this morning, and I just want to be sure that it was correct — as, again, lots of paper in front of me here.

Section 50. The amendment is looking to ensure that the chair be selected from members who have been appointed by government. Is that what this amendment is specifically doing? Because it's been addressed in another amendment.

The Chair: Hon. Members, for clarification. If we were to pass section 50, then we will take as a separate vote section 50.1.

M. Mungall: Section 50 is doing what section 20 of this bill did, and that is to specifically exclude certain members of the elected executive of a staff or faculty association from sitting on the board. Again, I ask the minister: does she not see this as particularly discriminatory, where she is targeting specific people and saying to the staff and faculty associations that they are not allowed to elect those people as their representatives to the board of governors?

Hon. N. Yamamoto: No.

M. Mungall: Why has the minister decided to target these specific individuals as not able to work in the best interests of a university?

Hon. N. Yamamoto: This provision addresses the ineligibility of an elected board member to serve on the board of an institution while they are simultaneously active as a voting member of the executive body or an officer of an instructional faculty or administrative staff or other staff association of the institution that has a responsibility or shared responsibility with others to negotiate the terms and conditions of service for members of the association with the board of the institution.

Again, we are not excluding the participation of faculty and staff from the board. We are excluding a few mem-
[ Page 10551 ]
bers, a few individuals of the faculty and staff who are actively involved in engaging in negotiating the terms of their contract with the university.

M. Mungall: I'm wondering if the minister can then answer why she feels that the codes of conduct and the conflict-of-interest policies at universities are not sufficient to address the conflict of interest of anybody who sits on the bargaining unit for a staff or faculty association, and for having them step down from the board of governors around those types of decisions.

Hon. N. Yamamoto: This goes back to our earlier discussion. One of the primary roles of a board of directors is to look at the financial matters of an institution. The majority of that does deal with the financial aspects, which includes, obviously, the bargaining with the faculty and staff associations.

[1140]

What we're doing with this amendment is to make ineligible someone who is actively involved in their faculty or staff negotiations to be also sitting on the board. This section is intended to prevent a clear conflict of interest arising from the outset.

M. Mungall: I'm just wondering if the minister has an example where there is a member who is of the board of governors who is also a member of the bargaining unit for a staff or faculty association — if she has an example of when such a member may have not acted in the best interests of the university, as already prescribed in this bill and is typically the case in practice around B.C.?

Hon. N. Yamamoto: As was canvassed earlier when the member opposite asked me a similar question, I did respond that from time to time we hear of some incidents that…. There were some issues at some institutions, but I don't think it's appropriate, because they involve individuals, to bring up specific examples in the House. Again, what we're doing is attempting to prevent an inherent conflict of interest from actually occurring in the first place.

M. Mungall: It's particularly difficult to gather an understanding of whether this type of legislation would address any possible problems that have arisen in the past if we don't know the details of those problems. The minister asserts that she needs to not share those because they involve specific individuals. Can she, then, maybe just speak to the incident without naming any of the individuals involved or the institution that they were at?

Hon. N. Yamamoto: Again, I will not talk specifically about a person or a specific incident. I don't believe that's appropriate.

This provision guards against the conflict of interest that results if a faculty or staff member of the board is effectively representing both the institution and the union at the same time. As a participating member of the board, a faculty or a staff member would be in a position to be privy to information that may be of benefit to them personally and could in turn be used against the institution during negotiations concerning their terms and conditions of service, salary and benefits.

M. Mungall: Like I said, it's very difficult to ascertain whether or not this type of legislation will address the problems that the minister asserts exist when we don't have an example of what kinds of problems are actually out there.

[1145]

Not only that, but if the problem did arise, then of course the next question is: did the existing conflict-of-interest or code-of-conduct policy at that institution actually work to resolve the problem, therefore concluding that this section is completely unnecessary? Unless the government's objective is to target specific individuals to discriminate against them for participating on boards of governors and to suggest that faculty and staff associations must elect only those that they defined as acceptable to sit on public institutions' boards of governors….

Does the minister acknowledge that…? I'm going to go back to this question first. Whatever incident that she might be saying exists, was it addressed and dealt with via the internal code-of-conduct and conflict-of-interest policies at that institution, if there is indeed a situation that happened?

The Chair: Members, the Chair will caution that indeed there are elements of this bill which repeat themselves, but this subject has been well canvassed.

Hon. N. Yamamoto: The intent of this provision is to avoid the situation that we've generalized from actually happening.

Section 50 approved on division.

On section 50.1.

The Chair: Minister, please reintroduce the amendment.

Hon. N. Yamamoto: I move the amendment to section 50.1 that is in the possession of the Clerk.

[SECTION 50.1, by adding the following section:

50.1 Section 27 (2) (b) is amended by adding "appointed by the Lieutenant Governor in Council" after "among its members".]

On the amendment.

M. Mungall: I renew my question on this bill. My understanding from my briefing — the note I made — this morning was that ultimately what this would do is ensure that the chair to a board of governors would have
[ Page 10552 ]
to be a member that is appointed by government. I just want to seek clarification if that is indeed the case.

Hon. N. Yamamoto: Yes, that is correct.

Amendment approved on division.

Section 50.1 approved.

Sections 51 and 52 approved.

On section 53.

M. Mungall: This section seeks to create personal education numbers for the World Trade University Canada. I just want to seek clarification that this World Trade University is indeed the university that does not actually presently exist — that it was in fact the university that resulted from a private member's bill put forward in this House by the MLA for Abbotsford-Mission. That university never established itself, currently doesn't exist, and the likelihood is that it will never exist because the proponent has been found out to have conducted himself fraudulently, and he is no longer seeking to establish this university.

[1150]

Hon. N. Yamamoto: The World Trade University Canada Establishment Act remains an act that is in force, and as such, it's necessary to enact amendments to add provisions relating to personal education numbers, similar to those provisions that are being added to the other acts governing private post-secondary institutions, until such time that the act is repealed.

M. Mungall: I'm just wondering, then, why the government hasn't taken the opportunity to repeal this act. I'm looking here at an article done in the Vancouver Sun dating back to August 2008. There are a considerable number of articles dating back to 2007 as well. The opposition here has also put on the books a private member's bill to repeal that act, and they did that in 2008 before the last election.

I'm wondering why the minister has then decided to not go that route in this amendment act and why she has chosen to cause staff to do some work around personal education numbers for a university that doesn't exist.

The Chair: The member will be aware that the comments are beyond the scope of this particular section.

Hon. N. Yamamoto: We are simply making the changes that we're making to all of the other acts, the private acts, and to include this one as well.

Section 53 approved on division.

Sections 54 and 55 approved.

The Chair: On section 56, consequential amendment.

Section 56 as amended approved.

Title approved on division.

Hon. N. Yamamoto: I move that the committee rise and report the bill complete with amendments.

Motion approved on division.

The committee rose at 11:53 a.m.

The House resumed; Mr. Speaker in the chair.

Reporting of Bills

BILL 18 — ADVANCED EDUCATION
STATUTES AMENDMENT ACT, 2011

Bill 18, Advanced Education Statutes Amendment Act, 2011, reported complete with amendments.

Mr. Speaker: When shall the bill be reported as read, Minister?

Hon. N. Yamamoto: With leave, now.
[ Page 10553 ]

Leave granted.

Third Reading of Bills

BILL 18 — ADVANCED EDUCATION
STATUTES AMENDMENT ACT, 2011

Bill 18, Advanced Education Statutes Amendment Act, 2011, read a third time and passed on division.

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

Hon. G. Abbott moved adjournment of the House.

Motion approved.

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

The House adjourned at 11:54 a.m.

PROCEEDINGS IN THE
DOUGLAS FIR ROOM

Committee of Supply

ESTIMATES: MINISTRY OF ENVIRONMENT

(continued)

The House in Committee of Supply (Section A); J. McIntyre in the chair.

The committee met at 10:09 a.m.

On Vote 22: ministry operations, $99,366,000 (continued).

R. Fleming: We were talking about areas around climate action and various programs and agencies in government yesterday, and I'd like to continue on that this morning.

One of the lines of questioning yesterday was with regards to the Pacific Carbon Trust, the two-track system we now have in British Columbia that has a different set of rules for sourcing offsets and achieving carbon neutrality for health authorities, school boards and other public sector organizations — and the one that has just come into being for local government.

[1010]

Local government will have much more freedom, as the minister confirmed yesterday, to purchase and secure offsets and create projects that can essentially bid back in for the moneys they pay.

I wanted to ask further to the minister about the administration of carbon-neutral local government what role, if any, the province will have in verifying compliance and any oversight to verify the quality of the offsets that will be purchased by local governments.

Hon. T. Lake: We're referring to the climate action charter that 180 communities around the province have signed and committed, under a voluntary basis, to work towards carbon-neutral government. While we don't have a statutory authority to force local governments to be carbon neutral, they've made a voluntary commitment. In fact, although this is under another ministry, the Ministry of Community Development, the Local Government (Green Communities) Statutes Amendment Act, Bill 27, states that local governments are required to include greenhouse gas emission targets, policies and actions in their regional growth strategies and official community plans.

One way in which the local governments that are taking action on climate change can demonstrate what they are doing is through their regional growth strategies and OCPs.

R. Fleming: I'm curious about why the reporting that will be required of local government, if they wish to apply for a carbon tax reimbursement, is within the Ministry of Community, Sport and Cultural Development.

I want to ask the minister what role his ministry and the climate action secretariat or the Pacific Carbon Trust — areas where there is expertise looking at securing and assessing the quality of offset projects…. Will they have any role to assist and oversee and examine the reports that local governments file as part of their carbon tax reimbursement? I mean, I think that is pretty important if the definition of carbon neutrality is going to mean anything. There has to be some oversight here in order to hand back money to local governments.

I wonder if the minister could explain what role his ministry will be playing in that new reporting regime.

[1015]

Hon. T. Lake: The Ministry of Environment and our ministry's climate action secretariat play a large role in helping to work with local governments through Community, Sport and Cultural Development and through UBCM Green Communities Committee.

It's of note, then, that the province has outlined steps to demonstrating a commitment to becoming carbon neutral. Those are, first of all, to measure corporate greenhouse gas emissions, take steps to reduce those emissions, offset remaining emissions or undertake community-wide emission reduction projects as outlined by the Green Communities Committee, and then report out publicly.

By having them report out, the province can then have the reimbursement of the carbon tax. We can have a picture of the corporate GHG emissions of local government and also what measurable GHG reduction projects the local government undertook and what, if any, offsets were purchased. The Pacific Carbon Trust certainly can act to help
[ Page 10554 ]
verify those. There are other companies, like Offsetters, for instance, that can help local governments with that.

Again, important to note, the local governments have voluntarily signed the B.C. climate action charter. For spring 2013, for instance, a carbon-neutral reporting component will be required in the 2012 carbon tax reimbursement reports. Those reports, as I mention, will include corporate greenhouse gas emissions, listed offsets, a list of measurable community-wide reduction projects and any offset projects that are used to balance against the corporation of the local government achieving carbon neutrality.

All of those projects are defined in the Green Communities Committee Becoming Carbon Neutral guidance document and framework, again through the Ministry of Community, Sport and Cultural Development.

R. Fleming: I think, from the minister's description, my understanding of what we're hearing is that this is really a file-and-receive type of reporting relationship that is being set up to measure carbon neutrality of local governments. And I think, from what he has said, that there is really no compliance activity going on. That's a concern.

I think some local governments are going to flourish very well under the system and have taken steps even before the legislation came into effect. But there is an incentive here that can cause problems when you report tonnage reductions and those numbers aren't real and they're worth cash money.

This has been discussed at the national and international level as one of the major areas for potential fraud in the world. Ernst and Young reported to the United Nations about this: that compliance activity for offsets, if these markets are to have any integrity, has to be secure.

I'm just a bit concerned about how light the reporting regime is here in British Columbia. We certainly have qualified agencies. Yes, it would cost them some time and money to have an audit function or to have a compliance function on these offsets, but I think it would go a long way to give some kind of assurance that the quality of these offsets is, in fact, true.

[1020]

Hon. T. Lake: The member was arguing yesterday, I think, about carbon-neutral government and how it wasn't a good idea. Now the member is arguing today that we're not enforcing carbon neutrality on local governments enough. I guess I'm a little confused by that.

What I would say is that we've tried to be flexible with local governments, recognizing that they are not under the direct purview of the provincial government, that they have voluntarily signed agreements to work towards carbon neutrality. We've worked closely with local governments to provide a framework for them to reach those targets of getting towards carbon neutrality.

We haven't taken a heavy-handed approach with local governments. As I say, they are not directly under the purview of the provincial government, so we've taken a different approach. That's from consultation with local governments, some of the concerns that have been expressed. Some local governments simply don't have the capacity to implement some of the strategies that are more easily implemented by the provincial government.

I think it's also worthy of note that local governments don't benefit from tax reductions due to the carbon tax. Part of the reason to reimburse local governments for carbon tax payments was because they're not benefiting from any reduction in the taxes that come with a revenue-neutral carbon tax.

We are seeing some great leadership, as I mentioned yesterday, with local governments like Dawson Creek, the city of Vancouver, the city of Surrey and many others that are implementing greenhouse gas reduction policies and that are working on different kinds of projects to demonstrate greenhouse gas reductions. Many of those projects, I'm sure, will provide inspiration for the private sector and for provincial public sector organizations as well.

R. Fleming: No, I think the minister misheard our discussion yesterday afternoon. We were talking about how there are two different systems now in British Columbia of what carbon-neutral government is defined as.

One has caused the minister all kinds of problems with the spectacle of cash-starved schools and hospitals sending tax dollars to major polluters in British Columbia like EnCana. Local government, obviously, was not going to put up with that, and they have received a concession that has given them flexibility to source offsets in their own jurisdiction.

I think that's what they wanted. They can do it within their own corporate emissions profile; they can do it within their own jurisdictional boundaries; or they can purchase offsets, really, from any vendor. That's the flexibility that I think school administrators and hospital administrators would like to have. Hopefully, after the review that the minister talked about yesterday, that's the one we're going to have in British Columbia.

The point remains that even under this local government system that has been in operation for eight weeks now, there has to be third-party verification for offsets. Government is apparently taking no role in overseeing those, even though there is a reporting relationship to his counterpart, the Ministry of Community, Sport and Cultural Development.

My question was, really: what is the Ministry of Environment going to do to make sure that the integrity is there so that there isn't any cynicism or problems that could emerge from reporting abuses?

Hon. T. Lake: As I mentioned, we are providing flexibility to local governments. Within the reporting requirements, they have to demonstrate the projects that
[ Page 10555 ]
they are working on and, as part of that reporting, have to talk about the verification process, whether it's purchased through Pacific Carbon Trust, for instance, or another third-party offsetter. Then that would be included in the reports.

[1025]

We've canvassed this quite extensively now, Madam Chair. I guess I would like to draw back the conversation to the actual estimates of the ministry, because I'm increasingly seeing the discussion stray away from the actual budget that we are discussing here and more into all of the policies around it. If the question were directed more to the way we are spending the funds of the Ministry of Environment, I'd be happy to answer more of those questions.

R. Fleming: I want to move on to the Western Climate Initiative, of which British Columbia had been a signatory. Prior to that formalization the then governor of California, Arnold Schwarzenegger, and the former Premier of British Columbia signed a memorandum to work together on various climate initiatives. That included a cap-and-trade regional system under the Western Climate Initiative.

I want to understand B.C.'s position and ask the minister…. He has said two very different things, even just in the last eight months, about B.C.'s participation. He said that British Columbia will be participating in the cap-and-trade system, and he has said that he does not believe that for the time being it is possible for British Columbia to participate.

I just would maybe ask him to state what British Columbia's current status is listed as in the Western Climate Initiative. I know that a number of states that now have Republican governments in the U.S. have walked away from the table. There are some provinces like Ontario that have changed their implementation timelines. Which camp is British Columbia in? Are they out? Or are they on a timeline that has yet to be published and shared with the public in British Columbia?

Hon. T. Lake: Well, I know I've always said that our initial plans were to implement a cap-and-trade system based on the Western Climate Initiative. That was part of the climate action plan of 2008. But of course, the right criteria had to be there for B.C. to make that decision.

I talked yesterday about the risk to our very successful carbon tax policy, a risk that none of the other jurisdictions have. I've had those discussions with the minister of Quebec, for instance, and our counterparts in California. While we commend them for moving forward with a carbon pricing system and we continue to engage with them in terms of what the system is and what the rules will be, they don't have the same policy in place that we do — which was, by the way, outlined as a world leader in The Economist earlier in the year. Actually, the title of the article was: "We Have a Winner: British Columbia's Carbon Tax Woos Skeptics."

Internationally this policy has been receiving accolades, and we don't want to put that at risk by entering into a system that is in the early stages of development and provides uncertainty in terms of success at this point in time.

While the plan has always been to consider going into a cap-and-trade system with our Western Climate Initiative partners and, hopefully, to integrate with the regional greenhouse gas reduction initiative in the eastern States and with other jurisdictions around the world…. In fact, when I was at the U.N. Climate Change Conference in Durban, we talked to other jurisdictions and talked about how we might be able to interface our carbon pricing mechanisms in the future.

British Columbia's position is that we will make a decision on moving forward on a cap-and-trade system when it makes sense for British Columbia. And as I mentioned yesterday, there are some climate change economists that have urged us to move with caution, because we do not want to put at risk the very successful carbon pricing policy that we have in place at the moment.

R. Fleming: Quebec has a carbon levy. It's put on large emitters, raises hundreds of millions of dollars in their economy and has existed since 2007. And they are proceeding with cap-and-trade.

[1030]

My question to the minister was about the timeline. British Columbia was a signatory and was to enter into the WCI cap-and-trade scheme beginning January 1, 2012. That is not happening. I've heard the minister say that. I've asked him for a fuller explanation of what is happening in relation to B.C.'s continued participation in the WCI, and I have heard that maybe we'll leave, maybe we'll join the RGGI with New England states that have a limited coal-fired electricity cap-and-trade scheme there.

It sounds to me like we're just completely adrift and haven't landed with any clarity on what role British Columbia is going to have with the WCI. In the meantime, Quebec has proceeded with clarity. They are working with California, which is the eighth-largest economy in the world, and they will have a cap-and-trade scheme. According to their timelines, auction of permits will begin in August 2012. That is happening.

British Columbia is not going to participate in that auction of permits and may not participate in the WCI at all. So I'm just wondering and asking the minister for clarity on what our relationship is and will continue to be with the Western Climate Initiative.

Has he received any information from his experts in his ministry to look at…? He's mentioned economic risks for proceeding with caution. Has he looked at some of the risks for not being there when the train leaves the station, for example, with the auction of permits that is coming
[ Page 10556 ]
down the track pretty quickly?

Hon. T. Lake: To say that we are adrift when this government took such bold steps on climate change, has been a leader, recognized in The Economist, recognized in the Los Angeles Times, recognized around the world…. To call our climate change policies "adrift," I think, does a real disservice to all British Columbians that participate and have made this policy successful.

To suggest that we would merely give up all that success or put all that success at risk just so the member can have an answer to the question of when we will do something is ludicrous. So I won't be tempted into saying that we will hit a certain date and then make a decision. We will make a decision that's in the best interests of British Columbia — British Columbian citizens, British Columbia industries and, in fact, the climate change policies that we have all worked so hard to implement and to be successful with.

We talked a lot yesterday about the carbon tax review that's going to be begun this year by the Finance Minister. That is an important conversation to have before we make any long-term commitments to a cap-and-trade system or any other carbon-pricing system that may be available to us.

A lot of things change in a few short months. We've seen in the United States, for instance, a decision not to go with cap-and-trade, a decision by the government of Canada not to go with cap-and-trade, even though they were all ready in 2009 to move forward with an integrated cap-and-trade program with the United States. Things could change again. Certainly, we want the option to be able to be nimble enough to implement policies that make sense for British Columbia.

We are working very closely with our Western Climate Initiative partners. I just recently met at GLOBE with Minister Arcand from Quebec to discuss how they're moving forward with California. I met with a senior member of the California resources board in Vancouver at that same time and talked about what California is doing.

We will certainly watch with great interest what is happening with any regional cap-and-trade system. Once we have done a review of the carbon tax policy and we see the way in which that system is moving forward, we will then make decisions based on information, rather than speculation, in the best interests of British Columbians.

The Chair: Member, maybe a gentle reminder for the relevance to the budget estimates.

R. Fleming: Thank you, Chair.

Yesterday we talked about those portions of emissions that aren't captured by the carbon tax. I don't want to go back there in too much detail. We were discussing process emissions — a huge volume of them and also projected to increase very significantly in the coming years with the expansion in the natural gas sector.

[1035]

One of the carbon-pricing pillars of the government's 2008 climate action plan was to have cap-and-trade deal with that scope of emissions that weren't covered by the carbon tax, which was primarily put on consumers and combustion sources. That is now removed, for the time being, as the minister has said in so many words — many more words. That is not happening, going forward.

Has he received advice from within government that has updated the climate modelling that was used to make those original GHG reduction assumptions, and is it going to have any impact in amending the climate action plan of government?

Hon. T. Lake: I answered that question yesterday.

R. Fleming: I wonder if the minister can confirm how underperforming the revenue-neutral carbon tax is. We asked the minister this yesterday. We didn't get a precise number. Perhaps he's had time overnight to get a number about what contribution to the overall provincial deficit is being made by the carbon tax — essentially advancing more tax cuts than revenue being achieved in the current fiscal year — and how that will be treated over the three-year service plan.

Hon. T. Lake: That is under the purview of the Minister of Finance.

R. Fleming: I would think that the minister would have an interest in that because the carbon tax is supposed to be revenue-neutral. It is not. Presumably the minister would be having discussions about why the promise of that in several budgets ago has not been achieved in the current service plan of the government, which includes his ministry.

It is not a revenue-neutral carbon tax. It's revenue-negative to the treasury of B.C., and I want to ask the minister how that current situation, which has not been addressed in this budget, is helping or hurting the ability of his ministry to achieve the legislated greenhouse gas reduction targets.

Hon. T. Lake: We discussed this yesterday quite extensively, and I mentioned that the member opposite is obviously advocating for a tax increase. I wasn't clear what tax he would like to increase — if he would like to increase the carbon tax or personal income tax, corporate taxes, small businesses taxes — to make up the difference.

But that is a question, as I have mentioned, for the Minister of Finance. It does not impact the estimates of the Ministry of Environment.

R. Fleming: I'm a little disappointed that the minis-
[ Page 10557 ]
ter couldn't clear more up about the Western Climate Initiative and about the carbon tax and how it's linking and supporting government goals and performance targets in his own service plan this morning. You know, we have press articles — he points to the positive ones from several years ago — asking the question of why B.C. has become a straggler in the battle against greenhouse gases, and that wasn't answered this morning.

I want to move now to ask some questions about the environmental assessment office. Perhaps that might take a couple of minutes for the minister to have the right advisers behind him.

[1040]

Hon. T. Lake: We are moving on to discuss the environmental assessment office, so we have some new staff members here. I just would like to introduce Derek Sturko, who is the assistant deputy minister for the environmental assessment office; John Mazure, who is the executive project assessment director; and Michelle Carr, who is a director, along with Shelley Murphy, another director of the environmental assessment office. Shauna Brouwer continues to provide expert advice on finance as our ADM for finance for the ministry.

R. Fleming: The first question I wanted to ask the minister is the estimated number of assessments or the actual number of assessments that have active applications or are in the pre-application stage at the EAO for the coming year, for the current year, and how that compares to the year previous.

Hon. T. Lake: Last year there were 76 total projects that were engaged in the environmental assessment process. What we consider active projects are generally defined as having required environmental assessment office staff time within the last six months.

You will get some interest from a proponent, for instance. They will contact the office. They will go away and do some work, and really, it may be a couple of years before they come back into contact with the office as they do their due diligence, look at financing and whether or not a project seems feasible to them.

The active projects, those that the environmental assessment office has been active on in the last six months, total 69 projects. I can break that down into different sectors for the member, if he likes. So 51 percent of those are energy projects; 19 percent, or 13 projects, are mining, coal and aggregates; 12, or 17 percent, are metal mines; 4 percent are oil and gas; 3 percent are tourism destination resorts; 6 percent are industrial waste disposal, shoreline modification, transportation and water management projects.

R. Fleming: The environmental assessment office has been the subject of an Auditor General report which is one of the most critical audits of any government activity that I think we've seen in years in this government. We'll get to some of the recommendations in that report in a little while.

Industry groups, communities, applicants have all argued that the EAO's capacity needs to be increased. We have seen the environmental assessment office's budget drop from $10.5 million to $8.75 million.

[1045]

We have a budget before us that freezes that amount for the next three years, and yet government released a "jobs plan" just a few months ago that promised, as one of its central planks, to turn around time for permits and current backlogs for investment. It just seems that the jobs plan is completely unaligned with the Ministry of Environment and the budget for the environmental assessment office.

There's a role for the EAO to help fulfil that goal, if it is in fact an actual goal and pillar of the jobs plan. There is concern about the capacity of the EAO to do that without any new funds and with the continuation of decreased funding that is something like 16 percent less than it was just a couple of years ago.

I would ask the minister if he had discussions, in preparing this budget, to align the government's goals around the jobs plan to increase the capacity of the ability to provide environmental assessments and, with it, permits and approvals in this budget.

Hon. T. Lake: With respect to a reduction over the last…. Our budget for the environmental assessment office has not been reduced this year versus last year.

A previous reduction was due to the movement of shared services from the budget of particular parts of the ministry to Shared Services, and that happens across all ministries. That's things like office space, information technology. That part of the operation was moved to a shared services model. Even though the money doesn't appear in the budget of the environmental assessment office, the operations and the operating budget of the environmental assessment office did not change.

Further to that, we saw earlier this year $24 million that was accessed from contingencies for other ministries in the natural resource sector to help deal with some of the permitting backlogs. So when we talk about environmental assessment, it's one part of accessing natural resources in the province of British Columbia.

As the member knows, there are some projects that don't need to come into the environmental assessment. They don't trigger the threshold. So they would be approved through other line ministries, and then the permits would be issued there.

Those that do come into the environmental assessment process are issued a conditional certificate. Then they will go and get the permits from the different line ministries. You can see the environmental assessment office works
[ Page 10558 ]
very closely with those other line ministries. Providing contingency dollars to those other ministries has helped with the flow of these projects.

The nature of accessing resource development in the province of British Columbia is, of course, very much tied to commodity markets and the economies around the world and the ability for industry to invest. So it's not necessarily the same from one year to another.

We only have to look at the price of copper, for instance. When I first moved to the wonderful metropolis of Kamloops in 1997, copper was trading at 60 cents a pound, and now it's, I think — the last time I checked — about $3 or getting close to $4 at one point. So that changes the investment climate and the need for the environmental assessment office to be activated.

[1050]

The government, of course, has contingencies each year in the global budget, so when the level of activity increases, the environmental assessment office has the opportunity to go to government to say: "Due to the increased level of activity we are seeing, we would like to access some of those contingencies to help us deal with that pressure." So that, I think, is the flexible way that governments react to the changing circumstances of different ministries, whether they be Social Development, where we see, of course, the demand change when the economy is not doing as well…. It's the same here when the demand changes, when the resource sector becomes more active.

R. Fleming: I think the minister concluded on the point that I wanted to ask him about, which is that when the demand changes, the resources for the environmental assessment office presumably change too, but it hasn't in this budget, although the major projects office expects something like $35 billion in potential projects to be reviewed. That's up from previous estimates.

There has been no change in the environmental assessment office. We have the Premier out making promises that there will be eight new mines. How is that going to happen if those mines aren't assessed in a comprehensive manner that respects all of the laws and the scope of the project properly and adheres to the values that are in the minister's own service plan, which talks about protecting the environmental values that citizens hold dear?

I would ask him again: how does the environmental assessment office's frozen budget for the next three years square with an investment cycle that is painted in much more rosy and optimistic terms and suggests that demand on the EAO services is going to increase?

Hon. T. Lake: While we do expect to see increased activity based on the interest that we see out there in the natural resource sector, the statements that I made earlier are still apropos. When those projects come forward, when we see the pressure develop on the environmental assessment office, we have the opportunity to access government contingencies.

I think that as a responsible government that is trying to control spending, it's important that when we make application to access those contingencies, we actually have to show the metrics and justify to the treasury that it is absolutely necessary, rather than put money into a budget without knowing precisely if it will be needed or not. I think it is a much more responsible system to access contingencies and demonstrate the need based on real metrics.

While we anticipate that we will have more activity, we will obviously react to that in the way that I have discussed in accessing contingencies. Of course, there are other ways to achieve outcomes rather than just spending more money. This side of the House believes that we always want to look at processes and make sure that we are efficient in our processes, that we are continuing to improve our processes to squeeze every last value from every dollar that the taxpayers of British Columbia spend here to support the services that we provide.

I would say there is a combination of things that can be done, including streamlining and continuing to improve government services — in this case, the environmental assessment office — but also the ability, when the demand is there, when it can be demonstrated through metrics, to apply for contingency funds from government.

R. Fleming: Well, I think the answer doesn't address the point that I'm asking the minister about, which is: you have a jobs plan that anticipates significantly more work and responsibility for the environmental assessment office, and you have a budget that doesn't give them the resources to do it. One of the two documents is wrong. Either the jobs plan has false assumptions, or the budgeting for the environmental assessment office is hopelessly unrealistic.

The minister is already talking about how he'll dip into contingency. It doesn't even seem like there was any budget-making that actually went into this process. I want to ask him…. He said that the EAO will manage this increase of demand by continuing to ask for more efficiencies and streamlining within the environmental assessment office.

[1055]

Well, the Auditor General did an audit of his agency. He knows that. He knows what the recommendations were. They were very difficult to hear, no doubt. I think that the environmental assessment office, to their credit, has taken them very seriously and is trying to respond to them.

One of them was that the EAO was not doing its job adequately when it comes to post-certificate compliance. So in actual fact, the environmental assessment office's major strategic focus right now is trying to do more at recognizing that there were responsibilities that they
[ Page 10559 ]
were not fulfilling adequately which were discovered by the Auditor General.

We have two things going on here. We have, apparently, more projects coming down the track for the EAO, more work for the agency to process within the timelines that government has set. And internally, we have an organization that is trying to right where it has been falling down on its responsibilities.

So I don't understand how the minister can say that we will streamline internally to both manage more work that's coming from the investment cycle that we're in and to respond to deficiencies and responsibilities that were not being met by that agency. It seems he's being squeezed from both ends, and he has provided a budget here that is inadequate to accomplish the job.

Interjection.

R. Fleming: How is the minister going to manage these two demand curves that are on his ministry? One is to fulfil the responsibilities and the recommendations from the Auditor General, which he said he will do, and align with the jobs plan, which says that his environmental assessment office is going to have a lot more work to do and a lot more applications to process.

When the Premier goes out and promises eight new mines…. Well, the minister knows how long a mine application can take and how complicated some of these applications are. He especially knows about the one that's in his backyard. We're just at the beginning stages of the Ajax mine.

These are complicated mine applications. The Premier has gone out and told the investment community there will be eight new mines in British Columbia. Well, the environmental assessment office has a major role in saying whether that is in fact going to be the case. The work falls to them. This budget here does not increase their capacity to be able to respond to what the Premier is saying and what the Auditor General has said about the internal organization of the EAO.

Hon. T. Lake: The Auditor General provided a report that pointed out some, in his view, weaknesses in the environmental assessment post-certificate process. I met with the Auditor General, had a good discussion about that. I think one of the issues that we discussed was whether the Auditor General went past the environmental assessment to the line ministries, which I mentioned are often the responsible ministries for compliance and enforcement over the permits.

I think it was fair to say that there was, maybe, a lack of adequate coordination between the environmental assessment post certificate and what was happening as follow-up with the line ministries. It doesn't require a lot of extra funds to ensure that that coordination is complete.

In fact, we did mention that $24 million was accessed from the climate action clean energy fund to help with other line ministries. Part of that is to assist those ministries in coordinating with the environmental assessment office.

The expectation for me as a minister, but I think the expectation for British Columbians, is that any project should be able to be followed on the government website, the environmental assessment office website, so that anyone that's interested in a particular proposal — whether it's the Ajax mine in Kamloops or any other — will be able to go to that website and determine where the project is in terms of the process; see the public comments that have been posted and the proponents' response to those comments; see where it is as the timeline progresses through the environmental assessment; post, if it is issued a certificate, what the conditions are on that certificate.

Then six months later, perhaps, the same citizen should be able to go to that website and find out where the company is in terms of meeting those conditions attached to the certificate. Then six years later, when the proposal is up and running and there is an operation in place, that citizen should be able to go and check and see what compliance and enforcement mechanisms were implemented to ensure that not only the conditions of the certificate were met but all of the conditions around the permitting that come from the line ministries.

[1100]

That's the goal. There are ways of getting there. Most of that will come through coordination, realignment of our staff. We have a strategic and compliance director now that manages that improvement we're starting to work towards for compliance and enforcement. We have the ability to interact with our neighbouring ministries, if you like, in Energy, in Natural Resource Operations, in the actual Ministry of Environment itself.

These are all the various ways that we are going to manage the pressures that come from the reaction to the Auditor General's report as well as the anticipated increase in activity.

When the member says that the jobs plan doesn't square with the budget for the environmental assessment office, the jobs plan is a plan that anticipates increased economic activity on the land base. As we see that happen, we have the flexibility to access government contingency funds if that is necessary — if the work pressure on the environmental assessment office results in slowdowns of the processes that will produce the economic activity.

It's much like running any kind of a business or household. You have a budget, but if you're wise, you have a bit of a savings account that you can access when the metrics show there is a need to do that.

I certainly don't have any problem with that. I think that's a very responsible way to handle the taxpayers' dollars in B.C.
[ Page 10560 ]

R. Fleming: I think what is going to probably happen, because the budget-making here has just been insert some numbers that were the same as the year before and isn't really budget-making at all…. Don't look at the demand curve and the problems within the EAO, which in this case were examined and exposed by the Auditor General.

We're going to end up going back and doing something that happened in 2006. That is when, again, government tried to squeeze money out of the environmental assessment office and not adequately support what was anticipated to be its needs to do its job. They ended up going back and adding $6 million over three years, because a backlog developed. There is a very real danger that the same thing is going to happen here. History will repeat itself, and this only happened a few short years ago.

That'll be unfortunate. What is budget-making if it's going to be fictitious and it's not going to be aligned with information that government has in other ministries that are expected to increase pressure on, in this case, the environmental assessment office?

I want to ask the minister about the Auditor General report. On the oversight of certified projects, there were some very, I think, illustrative findings there by the Auditor.

First of all, the main conclusion, which I think is alarming to British Columbians, was that all of the mitigation efforts that government requires of project proponents depend on a belief and a follow-through from the environmental assessment office, from the government, to inspect that various agreements and conditions of permit are being met on an annual basis, on an ongoing basis — during a construction phase, during a post-completion phase.

Of course, the discovery was that none of that is happening, or very little of it. I think that this has caused government to have to respond to this. The recommendations were so strong that, I think, government had to immediately say they agreed with them and would work on them. I want to ask some questions about how that effort is going here this morning.

One of the things the Auditor General pointed to as a source of false assurance that there were compliance activities going on is that there is a reliance on self-reporting from the project owner. So if they say that the water flow agreements are being honoured, it's because they're telling the government that that's happening. Government is not going to actually examine that themselves.

Self-reporting obviously has a role to play, but government oversight can't be entirely reliant on industry saying that they're adhering to the things they committed to.

That's what needs to change. Government has to rebalance its ability to have its own roles, its own set of eyes and ears on the ground, ensuring that compliance reporting is real and that it's happening.

[1105]

Could the minister tell me how they are going to move from a model that was almost entirely dependent on self-reporting by industry to something that is more balanced and is going to no doubt require staff resources to incorporate compliance activity that involves EAO staff being able to get out in the field and look at the projects themselves?

Hon. T. Lake: There were six recommendations that the Auditor General had for the environmental assessment office. I think the member is asking specifically about the fourth recommendation. I have quite a list of actions that are started or in progress or completed.

The recommendation and response was to develop and implement a comprehensive compliance and enforcement program that includes an integrated information management system to monitor project progress and ensure compliance.

This is what we have done. We have established a strategy and quality assurance unit to lead the development of EAO's comprehensive compliance management program. I introduced Michelle earlier, who is responsible for that.

A strategy for a comprehensive compliance and enforcement program has been developed. That strategy was developed by EAO with input from a third-party consultant and other government agencies and leading practices in other jurisdictions such as Australia. Key elements address all of the Auditor General's recommendations, including interagency coordination, drafting, enforceable certificate conditions, compliance inspections, compliance audits, investigations, enforcement and making outcome information available to the public.

In terms of boots on the ground, FLNRO compliance and enforcement staff and EAO staff designated under section 33 of the B.C. Environmental Assessment Act are to conduct inspections. Compliance inspections are underway. Additionally, EAO is hiring two additional dedicated compliance staff to coordinate and implement compliance inspections, investigations and enforcement measures for EA projects.

There are a number of other things here that are responding to the Auditor General's report, but I have to say that I am extremely pleased with the environmental assessment office and the work they have done to address the concerns of the Auditor General. I think what we have done is improve a government process, not just in the environmental assessment office but in the other line ministries that are responsible for permitting.

As we have reorganized government over the last few years around the natural resource ministries, I think we have a model now that works better in terms of integration and cooperation to ensure that we have a smoother flow of permitting, environmental assessment, compliance and enforcement once those proponents are up and running.

R. Fleming: I wanted to ask the minister about the new inspection regime that he says his ministry is working on. The environmental assessment office has set a target for ten project compliance inspections in 2012-2013, which is a good thing — up from zero. I want to ask how many projects fall into a category where they need post-compliance, post-certificate inspections.

[1110]

Hon. T. Lake: We are in the process of developing a risk-based framework to look at where a project would fall based on the level of potential risk. You could look at a major mine versus a wind farm — two different types of projects, two different types of potential adverse effects that would be mitigated through the conditions on the certificate and the conditions attached to permits that are issued later.

We're in the process of developing that risk-based framework. Obviously, those that pose a greater risk would have a different level of compliance and enforcement activities than those that pose a lower risk. That's something that's done in other jurisdictions that we look to for best practices, so that's what we're developing at the moment.

R. Fleming: We've talked this morning a little bit about the pressures on the environmental assessment office. One is the major project review and those estimates of what kind of work may come down, as well as the words of the Premier about the mines that she says will definitely happen. We've talked about the internal issues that need to be addressed from this audit.

There's another source of pressure on the environmental assessment office's capacity and ability to do its work — that is, the new requirements to expand how environmental assessments are done to factor in the cumulative impacts in various projects. This is something that the Auditor General, in a separate audit around the Oil and Gas Commission, identified major deficiencies in. It suggested that government has put this into legislation and has put this on the table of activity the government must do, but it is not, in fact, being done.

I wanted to ask the minister what the requirements and the direction to moving towards cumulative impact environmental assessments means, again, for the work of his office. It seems to me that it requires more technical expertise, more land base studies, more ecosystem studies of the interconnectivity where major project applications are sited — not less work, not a frozen three-year budget that has been reduced by this government.

I look forward to the minister's response.

Hon. T. Lake: First of all, I want to correct the member, who says we're not assessing cumulative effects through the environmental assessment office. That is simply not correct. We do assess valued components and the cumulative effects. In fact, having read through binders and binders of environmental assessment reports, I can attest to that, because I've read them.

What happens is that through the process, the working group — and through the public input — will identify valued components. Again, they would differ, depending on the project — if it's a mine versus a wind farm versus a run-of-river project. Those value components will differ.

Value components are looked at, and then the analysis of the significance of potential adverse effects are taken into account. A lot of that work is borne by the proponent, who will have to find qualified professionals to analyze some of these. Then that report will be evaluated by the working group as to those valued components.

[1115]

I can recall projects in which instream flow requirements, for instance, that were put forward by the proponent were deemed inadequate by the working group They had to go back and, with their qualified professional, look at ways of meeting a higher standard for those instream flow requirements to make sure that the habitat for the returning fish was adequate to support their life-cycle needs.

Each value component is subjected to different factors. The first one is probability. In other words, what's the likelihood of an effect occurring? That's kind of a risk-based concern. What's the likelihood of it happening?

What's the magnitude? That's the second factor, and it measures the degree of a perceived effect — so characterizing the effect by means of quantitative or qualitative data and analyses. Examples of magnitude considerations relating to valued components are the predicted concentrations of metals in water, the amount of fish habitat lost, how effects to an at-risk wildlife population relate to a minimum viable population threshold.

Another factor that is examined is the geographic extent — again, the spatial extent — of an effect. Again, this is site-specific. A large metal mine will have a much bigger geographic impact than would a wind farm.

Other factors include duration and frequency; reversibility — in other words if the effect on the environment is reversible once that project is up and running or when it's decommissioned at the end of the day. Then context, and that describes the characteristics of a setting in which an effect could occur. That might include considerations of ecological, environmental, social, health, heritage, economic, cultural and regulatory settings — things like ecological resilience, regulatory and policy regimes such as water quality guidelines and species-at-risk management.

We carry out cumulative effects analysis not just on environmental assessment projects but on all projects on the land base. We're continuing to develop our cumulative effects framework, and it is, I think, very important to do so.

Again, if you look back at the way things were done ten, 20, 30 years ago to the way things are done today, you'll
[ Page 10562 ]
see a continuous improvement in the way we look at the environment, in the way that we make decisions on the land base. I'm very proud of the work that we've done in cumulative effects. To say that we are not examining cumulative effects in the environmental assessment process is simply not true.

R. Fleming: I wanted to ask the minister about how the ministry is making efforts to address some of the findings around oil and gas contamination risks in the new oil and gas fields in British Columbia. There was another audit which also pointed to serious oversight deficiencies in government. It was focused on the Oil and Gas Commission and also the Ministry of Environment because of its responsibilities under the Environmental Management Act.

The findings were that there was insufficient oversight in British Columbia about upstream contamination risks which come from exploration and well completion and production. There are human and environmental health risks from this contamination.

It was quite a comprehensive audit that was done. The Auditor General found that the Oil and Gas Commission does not report adequately to the Legislative Assembly and to the public about how contamination risks are being managed.

The Ministry of Environment responded by working on the classification guidelines to identify the priorities of risk in this area. One of the recommendations that fell to the Ministry of Environment from this audit was that it create and implement an independent audit program in the oil and gas fields — the orphaned wells and wells that have completed production.

I want to ask the minister about how that recommendation has been treated and what new activities are being done now, which were found to be deficient in that audit report.

[1120]

The Chair: Through the Chair, please.

Hon. T. Lake: I can't speak for the Minister of Energy, who has responsibility for the Oil and Gas Commission. I can say that my understanding is that the Oil and Gas Commission has responsibility for compliance for contaminated sites and issues a certificate of restoration when those sites have been remediated.

However, if there are high-risk contaminated sites, they do refer those to the Ministry of Environment, and then they go through our contaminated sites regulation under the Environmental Management Act. We would have the high-risk sites referred to us, and then they would undergo the same process that any other contaminated site throughout the province would undergo through the regulations under the Environmental Management Act.

B. Simpson: Just a few quick questions. I have a bit of an oddball question for the minister, but I think the minister will be able to answer this question. Then I wanted to ask a couple of questions about cumulative impact, very briefly.

It's not really oddball in the question, just in terms of where it's being placed. It is about the ag waste intentions paper — just to get on the record what the minister understands is the adjustment that's being made there. The government's webpage still indicates that the ag intentions paper is still the one that's going to be used, and March 31 is still the end date for giving feedback on that.

I wonder if the minister could speak to changes to that process, because I understand that it is going to be changed. I see that the minister may not have the information.

Hon. T. Lake: I can speak to it.

B. Simpson: Okay, if the minister could speak to that, then I have a quick follow-up question on it.

Hon. T. Lake: I do apologize. I approved a letter, actually, last night or this morning. I can't remember, because I have been a little busy.

I'm glad the member brought this up, because I think it's an example of reacting to concerns with a government process. The ministry is trying to deal with the issue of agricultural waste. We know that handling of manure, in particular, is a concern not just to the natural environment but to human health.

We usually develop codes of practice by a process known as an intentions paper. An intentions paper basically says: "Here's our problem. We're thinking about doing this." Usually it's preceded by some signals out to the sector involved to say: "Hey, we've got a problem here. We're working on it." There is some dialogue back and forth with other ministries that may be involved — in this case, the Ministry of Agriculture. Then an intentions paper is put out to various stakeholders to say, "This is what we're thinking about doing to deal with this particular problem that we've identified" — in this case, agricultural waste.

I was at home one Saturday morning and got calls from people I know in the agricultural community who were concerned that the deadline for comments on this intentions paper was coming up at the end of March. We had a very good discussion. I immediately called my assistant deputy minister of environmental protection and had a discussion about it, talked to the executive director for the B.C. Cattlemen's that day, talked to another member of the agricultural community in Westwold who is very involved in this process, and realized that there was a concern in the agricultural community.

[1125]

I went back to staff and said that when I read the in-
[ Page 10563 ]
tentions paper, I got the impression it was overly prescriptive in terms of what we were trying to accomplish. While that may work for some sectors, when you have a more disparate sector like the agricultural sector — where you've got over 200 different commodities, you've got very independent-minded people throughout many rural parts of the province that may not have the same access to information that people in major centres do — I think you need a slightly different approach.

That's what we've recognized. What we've done is we've pulled back the date. I believe it's the end of June, but I could be corrected on that. Regardless, what we want to do is work with B.C. Ag Council and with other stakeholders, both at the provincial and the regional level, to get more input on this process and come up with something that makes sense in terms of achieving the outcomes. I think we all want the outcomes, which are a safe environment and safe water for community health purposes.

We are taking another look at that. The letter to stakeholders and anyone that is inquiring with the ministry has been approved and will be going out shortly. The website will be changed as well with that letter.

B. Simpson: Thanks to the minister. I had an agriculture tele-town hall last night where this issue was one of the issues. As the minister indicates, there is quite a strong reaction to this, but in part it's also because the industry doesn't believe a one-size-fits-all works here. There are some issues that they feel the government is trying to address but is putting regulations on the entire issue.

I'm heartened to hear that there is going to be a change. I had committed to folks at home to try and get back to them what the exact time frame was. They also wanted to know how they…. My understanding is it's going to be some kind of round-table process. Groups will be invited to work through this. But the individual operators wanted to know how they will be able to give feedback to this process between now and the end date, which I think is the end of May.

If the minister could just clarify how people can engage in the process and what the actual end date is, that would be helpful.

Hon. T. Lake: I just would like to correct…. The comments will be accepted until May 31, 2012. So that's going from March 31 to May 31. That is to allow stakeholders who have requested additional time to respond and provide comments. We're working with the B.C. Ag Council to organize further detailed consultation with the sector. It'll be an opportunity to discuss the environmental concerns that we're trying to get at and to look at the different possible responses.

I think the comment the member made about one size doesn't fit all is true. If you're looking at the amount of rain in one part of the province versus another, the type of runoff you're going to get over a field or an area where agricultural waste is handled will be quite different.

That will be an opportunity for stakeholders to have input, either through organized groups like the B.C. Ag Council or B.C. Cattlemen's but also individually through the website up until May 31.

B. Simpson: For those millions of people that are listening, this is one of those examples — I agree with the minister — where people act early enough to get their voices heard, actually engage in the process early enough, then, I do think, it gives the government the opportunity to rethink and sit down with stakeholders.

I had attempted to do this with the meat inspection regulation. I don't think people engaged early enough in that to have their voices considered. As a consequence, we've been trying to fix that now for three or four years — right? The commitment was already made, regulations already passed, and people engaged a bit late in the process. So it's heartening for folks, and I think that people will appreciate the fact that the government has adjusted the time frame.

I don't want to take up the Environment critic's time here. I may follow up with the minister on this other issue. I want to go back to the cumulative impacts. What I may do is look to have a conversation with the minister once estimates are out of the way and so on.

But the issue that the member for Delta South and I encountered up in the Peace region, having spent a week up there…. We spent nine hours with the Oil and Gas Commission. We spent two or three hours at the B.C. Hydro consultation office around Site C, etc., and then we spent a lot of time on the ground.

[1130]

It struck us that while the environmental assessment process is looking at a project-by-project basis and what's happening on the projects, and the OGC is project by project, there is a planning function that's missing, and there's a cumulative impact function across all projects that's missing.

My question to the minister is this. Again, it's sort of a straightforward question, but I will follow up. When the government, for example, issues the job strategy and targets expansion of the oil and gas industry, from a planning and cumulative impacts perspective, does the Ministry of Environment sit back and do some projections over, say, the next five years of what this strategy means in terms of overall water demand? Not one-offs, but there's got to be some idea that if we're going to expand this industry 30 or 40 percent, then water demand is going to look like X in what watersheds. What will be the cumulative loading and demand on those watersheds?

GHG impacts. We asked the Oil and Gas Commission straight up: "What are the GHG implications of ex-
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panding oil and gas?" They couldn't answer the question. They said, quite frankly, that it's not their responsibility to look at overall accumulating GHG impacts from there.

Then, of course, land base impacts. We experienced that when we went into a small farming community. Because they have four different companies with multiple projects, all of a sudden that farming community is industrialized. The roads now become industrial highways. They have pipelines criss-crossing everywhere. They have all kinds of implications for air quality, etc.

Does the Ministry of Environment do any kind of comprehensive on-the-ground planning with a forward look that then helps them to understand the true accumulating effects of development in that particular area? Let's use the Peace as an example. Is that a function of the Ministry of Environment?

Hon. T. Lake: The member brings up, I think, an issue that has been a concern for government, for residents of British Columbia and certainly for First Nations.

We have been doing a lot of work on cumulative effects. Our ministry, along with Forests, Lands and Natural Resource Operations and the Ministry of Energy and Mines, are working with Treaty 8 nations in the northeast sector of the province, where the member recently visited, to develop a pilot project on cumulative effects.

We've got a framework that we're looking at. I mentioned some of the ways that value components are being examined in the environmental assessment process, and some of those same processes are at play here. The Oil and Gas Commission also has a cumulative effects framework which is actually called a tactical basin management, but the value components are the same as we are using in our pilot projects.

[1135]

We also have a pilot project that will be undergoing in the northwest part of the province, where we will see a lot of activity occurring, as well as the West Okanagan–Nicola area, where we have some pressures, especially around water use.

The Treasury Board did release some contingency funds through the climate action clean energy fund reallocation. That will help to support these projects. So we have been given the fiscal capacity to handle this kind of work.

Also, as the member knows, the Water Act is going through a modernization process, and we understand that water pressures are different in different parts of the province. Up in the northeast there was concern a couple of years ago about the number of creeks that were under pressure. Parts of the province around the Okanagan have experienced that kind of pressure. The way we're working through this is sort of an area-based approach. Again, one size doesn't fit all.

I just want to mention a couple of things. I did have the opportunity to go up to Fort St. John last year and did, essentially, what the member did — look at the operations, fly over the area of the Williston reservoir and talk about water use. There are some very creative things being used. The Debolt treatment plant to access deep saline, for instance, means that we're not putting pressures on the aquifers. There is a lot of reuse of water, and in fact, grey water from the city of Dawson Creek can be used by the oil and gas companies as well.

Again, creative ways to make sure that we are using water, which is obviously our most precious resource, in a way that makes sense, in a way that looks at the sustainability.

We've heard a lot about the amount of water being used. The permits that are issued versus the actual amount of water being used — quite different. The actual amount of water is quite small. But through the water sustainability act and other processes that we're putting in place, I think the right thing to do is put better metrics on the amount of water being used so that we can…. Again, you can go and find out exactly what's happening in different parts of the province in terms of those kinds of resources that we value.

V. Huntington: I get a sense from the minister's answer to the member for Cariboo North's question…. We had a very significant sense that cumulative impacts were not fully understood, were not even being really considered. The Oil and Gas Commission didn't think it was its problem. Yes, they said there was some profile system. Maybe that's the risk management system that you're talking about. But there was something going on within the ministries that we weren't aware of.

I would suggest to the minister that the impacts are enormous up there and that if his ministry doesn't get on top of them quickly, it's going to be a runaway problem for this province and its environment and the issues surrounding what is a very critical industry to the province. There is no way that industry is being properly managed from a cumulative point of view, and I really hope the ministry is sincere in working through those issues with the Oil and Gas Commission and the other relative ministries.

I want to go back to a comment the minister made with regard to emergency responses and high-risk environmental emergencies. The member for Cariboo North and I were briefed on an issue up there that involved a fairly significant pipeline break of contaminated toxic waters from an unregistered pipeline. Our information is that neither the Ministry of Environment nor PEP were advised.

This was a significant cleanup. It killed cattle. There is no follow-up from the ministry. This individual was basically left on his own to deal with a company that wasn't particularly proud. They didn't even know in the initial…. The landowner didn't even know the pipeline existed.

[1140]

I wondered what the reporting systems are within the Ministry of Environment and how you are able to stay on top of these types of issues that are occurring. Just take the oil and gas sector. How do you manage and follow-up on sites that have been significantly contaminated?

Hon. T. Lake: I can't comment on this specific incident that you are referring to. If there is information that you would like us to act upon, we would be happy to do that. What should happen is that when a spill occurs, it would be subject to the spill reporting regulations of the Environmental Management Act. Obviously, if a spill is not reported, we don't know about it. If we hear about it, then we act, but typically these are reported right away, in most cases.

We have a risk-based response. We have environmental emergency response officers throughout the province, so I'll be at home or on the soccer field and get an e-mail that we have got a response going on and it is this level of response due to this. For instance, we had a sewage line break in Trail earlier this week. So I'm updated as to the level of risk, the response and the anticipated time of a fix, in some cases.

We can talk about the Goldstream tanker spill, which is just about one year ago now, and the extensive response that occurred there. There is a responsible party. In the case of the spill in Goldstream, it was the fuel company that was responsible. They would then go into the contaminated sites regulation and be responsible for cleanup.

Our ministry would serve to act in terms of compliance and enforcement to make sure that the cleanup occurred. The responsible party is responsible for all costs and, in fact, our costs as well. If it is on private land, for instance, and there is a minor spill, then we go in and make sure that the landowner is dealing with it. If there is no threat to human health or a threat to the environment, then that's a lower risk and it's handled a little bit differently than if there is potential of a stream contamination or a threat to human health, in which case it would be a higher risk and a higher level of responsibility in terms of the landowner to clean up.

[1145]

V. Huntington: In view of time, I won't pursue the issues. I could only suggest that the ministry review its protocols with the Oil and Gas Commission, because there is some gap here that needs to be looked into.

I want to go and talk a little bit about cumulative impact assessment also. I personally feel there seems to be a change in definition of words happening here. The public look at a cumulative impact assessment as the actual accumulated impacts of all of the different projects, all the different sections of a project — the accumulated impacts of the varying projects that make up a single whole.

If I use Delta as an example, all of the projects that are taking place in Delta that relate to Deltaport and the construction of Deltaport and the management of the Pacific gateway project…. When the minister says the province is doing a good job and a much better job in issues of cumulative impact assessments, I would suggest to him that they are not.

Does the minister know that often projects are broken up into sections that fall under the thresholds for cumulative impact assessment? So the South Fraser perimeter road contracts would be let in 19-kilometre sections so that they didn't hit the 20 kilometre section threshold that enabled a cumulative impact of the entire project. The same happened on the Malahat highway.

We have documents, Minister, that show the Department of Fisheries and Oceans, for instance, helping the Port of Vancouver avoid a cumulative impact assessment process and a panel review by showing them how to remove terminal 2 from the construction of the third berth out there.

There is a real problem here in obeying the law by avoiding the law. I think this is something that the minister has got to start looking at, and I would like him to tell us what his understanding of a cumulative impact assessment actually is.

The Chair: Minister, and noting the hour.

Hon. T. Lake: Thank you, Madam Chair. I wondered why I was getting signals from my stomach.

First of all, I won't answer for the Department of Fisheries and Oceans. So I won't comment on that.

The South Fraser perimeter road was a reviewable project. It was reviewable because it was more than 20 kilometres of paved highway. I'm not quite sure…. There is no indication from the information I have that it was broken into smaller components so that it would not be reviewable.

The member is correct in that you have to reach a certain threshold to be reviewable. Some proponents, even though they don't meet that threshold, voluntarily come into the process. Since I have been minister in the last year, I know of no projects that have been altered or rejigged to try and avoid an environmental assessment. As I say, some have voluntarily come into the process, because I think it provides them with a better project.

In terms of cumulative effects, these are the likely impacts from a reviewable project combined with the impacts from prior development, existing activities and reasonably foreseeable future development. So we don't just look at the project. We look at all the activity that's going around.

[1150]

We do comprehensive baseline studies, which set out the current conditions and thereby factor in effects of
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prior development, potential overlapping impacts due to other developments….

For instance, if there's a wind farm and a potential mine in an area, you would look at the potential overlap in effects, potential future overlapping impacts that are reasonably foreseeable. Obviously, we can't predict for certain what projects may or may not happen in a particular area, but you can get an indication from mineral exploration tenures that are out there about what may happen.

I'm not sure if the member was present when I went through the way in which each valued component is assessed, but I certainly can provide that information to her. I can tell the member that through the environmental assessment process, those value components are assessed for cumulative impacts.

With that, I move that the committee rise, report progress on the Ministry of Environment and seek leave to sit again.

Motion approved.

The committee rose at 11:51 a.m.

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