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)

Wednesday, May 16, 2012

Afternoon Sitting

Volume 38, Number 5

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

WEDNESDAY, MAY 16, 2012

The House met at 1:33 p.m.

[Mr. Speaker in the chair.]

Routine Business

Prayers.

Introductions by Members

E. Foster: It gives me great pleasure today to introduce two guests that are visiting from the Okanagan. I was about to say they were both constituents of mine, but it just occurred to me that my guests, a mother and her daughter…. Kat Bruce is a constituent of mine, a resident of Lumby and a longtime friend, and her daughter, Kendra Rich, I believe is a constituent of the Minister of Forests, Lands and Natural Resource Operations.

They are here to have a look at how things work in the Legislature and visit Victoria. I ask the House to make them very welcome.

Hon. D. McRae: As many of you know, today is 2012 B.C. Beef Day. It was a great celebration back behind the Legislature.

In the gallery today we have a group of representatives, though, from the B.C. Cattlemen's Association. I would like to take this time to introduce them. They represent a huge number of individuals across this province who do great work.

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Today we have Judy Guichon, David Haywood-Farmer, Bonnie Haywood-Farmer, Kevin Boon, Mike McConnell, Rick Mumford, Larry Garrett, Martin Rossmann, Kirsten Halstead, Craig Park, Brooke Madley, Joe Gardiner, Samantha Gardiner and Fred Cave. Would the House please make them welcome.

J. van Dongen: I'm very pleased to introduce to the House today my cousin, a retired teacher, Dr. Adriana Zylmans from Richmond. Visiting with her is her cousin from Holland, Anya Zijlmans — the very young-at-heart Anya Zijlmans. With them, as well, are Joan and Rick Withers. Joan is a retired teacher, and Rick is retired from the Ministry of Education. I'd ask the House to please make them all very welcome. Joan and Rick are from Victoria.

R. Hawes: This is going to be a fairly long list. Today we had the Canadian Diabetes Association visit us in the Legislature. Today is diabetes day in the Legislature. Today in the gallery are a number of members of the staff of the Canadian Diabetes Association, and those who have diabetes and their parents.

We have Chuck Pusateri; Connie Abram; Donna Van Walleghem; Glenn Doucet; Heather Vandergeist; Janet Noden; Jenny Schmidt; Jessica Schmidt, one of the cutest little girls you'd ever want to see; Joshua Gates; Julia Holder; Laura Brandes; Leslie Lopez; Meg Stevens; Mike Cloutier; Patty Gates; Pilar Iglesias; Randi Garcha; Riki Lewald; Steven Lang; Tanyss Christie; and William Van Den Broeck, a young man who I am absolutely convinced will one day be sitting here in this Legislature. Could the House please make all of them welcome.

B. Simpson: I, too, had the opportunity to go outside and enjoy the beef as we celebrated Beef Day. I have to say that the Speaker looked very good in that black cowboy hat. It matched your outfit quite well.

In the gallery today, I think, is a constituent of mine that's down here with the B.C. Cattlemen's Association, Martin Rossmann. Martin is the president of the Quesnel Cattlemen's Association and has done a very good job of keeping my office informed about cattlemen's issues in our region. Welcome to Martin, and I ask the House to make him feel welcome.

R. Howard: I have two guests to introduce today. With us are George and Becky Chan of Victoria. George and Becky are the brand-new owners of Jonathan's Restaurant in Victoria, one of Victoria's best-kept secrets nestled in amongst the landscape there in the Royal Scott inn. Would the House please make them welcome.

Statements

BIKE TO WORK WEEK IN NANAIMO

D. Routley: Yesterday the Whip on this side of the House gave me the privilege of being able to drive to Nanaimo and back, which was a bit of a contradiction because it was for Bike to Work Week. I participated in a commuter challenge and won against the cars that I was competing against. It helped that one of those cars was stopped for speeding. I won't say who was driving it — Mayor John Ruttan of Nanaimo.

It was a great event that brought increased awareness to the role that bicycles play and an increased sense of respect both from car drivers to cyclists and from cyclists to drivers as well. I'd like the House to help me celebrate Bike to Work Week in Nanaimo.

Introductions by Members

D. Barnett: I, too, would like to recognize a member from the B.C. Cattlemen's Association — a very dedicated, hard worker in my riding, past president of the Cariboo regional hospital district and a director of the Cariboo regional district that did many, many wonderful things for my region — Rick Mumford. Would you
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please help me welcome him.

M. Dalton: In the gallery today is my wife, Marlene. I was going to say she's wearing fuchsia pink, but there are five ladies that are wearing fuchsia pink, and I don't want there to be any confusion. She's there, anyways, with a good friend of ours, Barry Pegg. This is his first time in the chamber since 1966, when he was part of the Youth Parliament. So would the House please make them feel welcome.

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J. Rustad: The Spirit of the North Health Care Foundation does a lot of great work throughout the north. My colleagues from Prince George–Valemount and Prince George–Mackenzie, along with myself, like to try to support it where we can. An item that was auctioned off was to have a lunch down here.

I'd like to introduce to the House Steve Pataki from Prince George as well as Norman McMillan and Irene Ohlson from Qualicum Beach. We had an opportunity to have lunch today to talk about the goings-on in the Legislature. We were also joined by the member for Parksville-Qualicum, who came and had lunch with us. Would the House please make them welcome.

Hon. T. Lake: I wanted to quickly join my colleagues in welcoming the B.C. cattlemen here today, a great organization located in Kamloops.

I also want to take the opportunity to talk about the SPCA City Challenge, Kamloops versus Prince George, which we win every single year. I want to remind my colleagues from the Prince George area that they should be helping out their SPCA, contributing, as should all members across the province, to support this great organization. I look forward to seeing my colleagues from Prince George wearing Kamloops Blazers shirts here in the Legislature.

Hon. S. Bond: I can assure you that one of the last things that my colleague from Prince George and I will be doing is wearing a Kamloops Blazers jersey.

I am very delighted today…. I know there is a tradition of announcing the birth of new babies in the chamber. I want to rush to admit that it is not a grandbaby, so it wasn't a big secret I was keeping.

Linsey Cole, who was the administrative coordinator for the Minister of Advanced Education before she left on her maternity leave, and Chris Tupper, who was my former ministerial assistant, welcomed their first baby yesterday. Alistair Cole Tupper weighed in at 9 pounds 4 ounces. From the first picture that I got, I can assure you that he looks like a mini-Tupper.

I know that many have worked with both Linsey and Chris. We are very, very excited for them. I know they are going to make wonderful parents. They are caring, thoughtful and fantastic people. So we want to welcome Alistair Cole Tupper.

L. Reid: I would ask the House to join me in welcoming two wonderful women to the gallery today. One is no stranger to this place, Sheila Orr, a former member, and one is attending question period for the first time, Anne Millar. I'd ask the House to please make them welcome.

Hon. B. Lekstrom: As well, joining us today representing the B.C. Cattlemen's is a friend of mine and a gentleman who has worked long and hard for the beef industry in this province. Will the House please join me in welcoming Mr. Mike McConnell.

D. Hayer: Joining us in the gallery are four exceptional students from the best school in Canada, Kwantlen Park Secondary School in Surrey. These students are Alliance Babunga, Leea Stott, Jasmin Ring and Faythe Lou. They are accompanied by their teacher, Ms. Neetu Dhaliwal, who is a former constituency assistant of mine. Her family is one of the very prominent pioneer families in Canada.

I'd like to recognize these amazing students, as they are winning finalists in the Rotary Club of Surrey citizenship development program. Each of them wrote a short speech about what being a Canadian citizen means to them and what contribution they have made to the community of Surrey. This competition and this trip are sponsored by the Rotary Club of Surrey and the Adventures in Citizenship program.

They are also joined here by the Rotary Club of Surrey volunteer supervisor and past president, Mr. Duane Buchanan. My wife, Isabelle Martinez, is here, who is also a past president of the Rotary Club of Surrey.

I have welcomed these from the Adventures in Citizenship program to Victoria for the last 11 years. I would appreciate if the House would please make them very welcome and thank them for the exceptional work they have done — the students as well as their teacher and all the volunteers — and for coming over here and learning about the government.

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Deputy Clerk: Introduction of bills.

S. Fraser: I'd like to introduce two Bills today: my colleague from the Cowichan Valley and the hon. Speaker. I've always wanted to do that.

Interjections.

Mr. Speaker: Members. Members.

Does the member for Kootenay East want to get up on a point of order? [Laughter.]
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Statements
(Standing Order 25B)

B.C. BEEF DAY

D. Barnett: Today is Beef Day, and for us here at the Legislature, it's about more than just enjoying a spring barbecue in the sun — though it was very delicious, I must say. Today we are joined by the B.C. Cattlemen's Association, the Ranching Task Force, representatives from the B.C. Food Processors Association, local government, industry representatives, and all kinds of others.

Beef Day is about appreciation, education and celebration. We appreciate the hard work of all B.C. ranchers, who are leaders in animal health, food safety and land stewardship. We educate people about the strong partnership between our government, the B.C. Cattleman's Association and the B.C. Association of Cattle Feeders. Because of this partnership, families thrive, our economy thrives, and we have more opportunities for tomorrow.

We celebrate our accomplishments, getting B.C. beef into the Chinese and Korean markets. Our government and B.C.'s cattlemen work hard together, so today we celebrate the progress we know we'll make in years to come. We celebrate those who enjoy it. Beef is a staple food item for most B.C. families, and it is a natural part of our culture and heritage. Of course, we celebrate those who are skilled in the fine arts of preparing and cooking beef.

I must thank the Freding family for their wonderful Angus beef from Oliver, the House of Q barbecue team and chef Brian Misko for showing us how it's done. On behalf of everyone here in the Legislature, happy Beef Day.

CHILD AND YOUTH IN CARE WEEK

C. Trevena: Designating a week of the year to a certain topic, issue or group is intended to focus society on that topic, and maybe sometimes we should keep that focus a little longer. The fourth week in May was last year designated as Child and Youth in Care Week. It's an opportunity to highlight the diversity of the population and its ability to survive through many vicissitudes. But our society should keep a focus a little longer than just one week.

Children and youth in care are, like all young people, unique. They have their own needs and their own accomplishments. As the Federation of Youth in Care Networks suggests, we should "encourage our communities to notice, listen to and respect them." That is fundamental.

Children and youth in care are not just statistics, not just the numbers of kids who have been removed from their families for whatever reason but living and breathing human beings and often very vulnerable; where parents are unable to take care of them and often where a family member can't help; kids who are differently abled and kids who have real problems.

Foster families are there, usually loving and hard-working families who provide extraordinary support. But then the kids age out. When they turn 19, they're deemed an adult, and they lose that care and that fragile support.

It's not easy finding your way in the world, and it's much more difficult when you're totally on your own, navigating everything from food bills to apartment rentals to post-secondary loans. No youth wants their hand held through everything, but on this Child and Youth in Care Week we should acknowledge that we can do better for young people as they move away from government care into the adult world.

This is perhaps the time to remember that we are signatories to the UN convention on the rights of the child, which comes with significant rights for young people and the responsibility for us to guarantee them.

We have a duty to both protect and nurture those children and young people, and that means providing stability, guaranteeing education. It means treating children and youth with dignity and respect, not just ensuring that their basic needs are met.

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We won't know how well we've done for many years, but if we have truly invested in our young people in care, if we've shown them respect, our whole society will benefit.

DIABETES

R. Hawes: Today is diabetes day in the Legislature. Today in British Columbia there are 360,000 people living with type 1 or type 2 diabetes. By 2032 that number is expected to grow to over 770,000, and about 5 percent of those have type 1 diabetes.

Unfortunately, statistics show that 57 percent of Canadians with diabetes cannot afford the medication, the devices and the supplies they need to effectively manage their disease. Not properly managed, diabetes can lead to kidney failure, blindness, heart attack, stroke and amputation of limbs. And 80 percent of the cost of diabetes to the health system relates to treating these complications.

Clearly, ensuring those with diabetes have the tools to manage their disease is critical. Any investment the government makes today to decrease the number that cannot afford to manage their diabetes will pay dividends in the longer term. Today the Canadian Diabetes Association released a report that shows that if every diabetic that could benefit from an insulin pump had a pump, the savings to government would be over $5 million annually by the year 2032.

At the same time, though, if we are able to reduce the epidemic of type 2 diabetes, which is largely preventable and is now more and more showing up in children, we would dramatically reduce the financial cost to taxpayers.
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But even more important is that we would greatly reduce the terrible toll these complications put on families if we all took the diet and exercise steps that delay or prevent type 2 diabetes.

The message is get assessed, get active, eat right, and invest in those with diabetes so that they can control their disease. We will all benefit.

CYCLING4DIVERSITY
MULTICULTURALISM INITIATIVE

D. Routley: I'd like to share with the House some information about a great event called Cycling4Diversity. This is a group of cyclists who are attempting to walk the talk, or cycle the cycle, of multiculturalism. We often talk about how we need to respect the differences in our community but then shrink back into comfortable settings after expressing those sentiments.

This is an event that is a mission to Victoria, a bicycle ride visiting nine cities. There have been eight proclamations, one by this House, which proclaimed May 20 to 26 Cycling4Diversity Week. They're building dialogue one city at a time.

Eight to 12 riders will be riding all the way. They stop at schools to promote diversity and awareness of issues regarding racism. They encourage us all to become more involved interculturally and to address the divisions and isolation that grow between communities.

As we become more diverse in this province, we face increased issues of diversity and division. This awareness and creation of a discussion will come to culmination here at the Legislature on the 25th. I'll be joining them in Sidney to ride into the Legislature. They will visit Vic High, a fire hall and one other school.

Ken Herar started this event because he was invited to a Christmas party but then wasn't allowed because they weren't inviting South Asians. He felt that rather than react to that negatively, he would do something positive. So as diversity columnist with the Abbotsford Times, he decided something had to be done.

We often talk about diversity and multiculturalism and the need to heal the divisions, but we don't often live it the way Ken Herar and these people who are supporting this ride do. Our existing communities must embrace each other without sacrificing our own cultures.

The ride will leave on the 22nd and end here on the 25th in Victoria. I'd like to congratulate all the people involved with Cycling4Diversity.

PROVINCIAL PARKS

J. Thornthwaite: Next weekend thousands of British Columbians will head out to B.C. parks for the Victoria Day long weekend, and for good reason. Our parks offer great value and the perfect opportunity for families to get outside and enjoy our beautiful province.

Reservations are up 13 percent this weekend, and B.C. Parks, when they opened for reservations in March, saw a 41 percent increase over the same period in 2011. Almost 20 million people visit our provincial parks every year, and it's not surprising that people are flocking to our parks. The visitor satisfaction rate is 80 percent, and we're always working to raise it even higher.

I consider myself very lucky to have Mount Seymour Provincial Park right in my own backyard.

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Last year I attended the announcement that you don't have to pay to park in parks, with the Premier and the Minister of Environment. Last month I joined the minister and my colleague from North Van–Lonsdale and volunteers from the Vancouver Korean Hiking Club to deactivate an unauthorized trail at Mount Seymour. We celebrated the work and commitment of all of our park volunteers.

British Columbia has 101,005 parks, and 15 percent of our province's total area is now protected, more than any other province in the country. Our park system is second in size only to the Canadian national park system. There are about 6,000 kilometres of hiking trails, almost 1,200 roads and 27,000 free parking spots.

More than 230 parks have facilities for those with disabilities. That's made our provincial parks even more accessible for everyone. I encourage everyone to get out and enjoy our B.C. parks.

MINING DEVELOPMENT PROCESS
IN CARIBOO AREA

B. Simpson: The Cariboo region has an abundance of opportunities to expand mineral exploration and extraction as a means to offset any falldown in the economic activity resulting from the mountain pine beetle. Along with the expansion of Gibraltar and Mount Polley mines, opportunities exist for both new and expanded hard-rock and placer operations. Every mineral opportunity realized will create jobs and bring additional economic benefits to Cariboo communities.

In order to realize this potential, however, mining must adhere to three basic principles: minimal ecological footprint, respect for First Nations rights and title, and maximum economic and social return to British Columbians, who at the end of the day are the true owners of B.C.'s mineral resources.

The evolving relationship between Mount Polley mine and the Williams Lake Indian Band serves as an example of how companies can have productive relationships with First Nations. Spanish Mountain Gold provides another example. The government has also recently taken a leadership role in addressing the First Nations referral backlog in the Cariboo region by assigning a specific staff person to this function for placer operations.

However, the mining community has informed me
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that they still have permitting angst — that the permitting process is still understaffed and that economic opportunities in both mineral exploration and extraction are being lost as a result. The industry also has concerns about a growing skilled labour shortage and fears that without a plan to address this, more temporary foreign workers will need to be used, limiting the social and economic benefits local communities will receive from mining activity.

A final concern expressed to me by the mining community in the Cariboo is the increasing regulation and fees imposed on mineral exploration and on small and medium-sized placer operations.

As we celebrate Mining Week, my hope is that the government will ensure the issues and concerns that may prevent us from realizing the full potential of mining in the Cariboo region will be addressed in partnership with miners, First Nations and local communities.

R. Lee: May I seek leave to introduce a group of students?

Mr. Speaker: Proceed.

Introductions by Members

R. Lee: It gives me great pleasure to introduce a group of 31 grade 5 students and nine adults from Holy Cross Elementary School, led by Mrs. Sabina McCloskey. The school is one of the best schools in B.C. Would the House please help me give them a very warm welcome.

Oral Questions

COSTS TO B.C. OF
FEDERAL ANTI-CRIME LEGISLATION

A. Dix: On November 2 of last year I asked the Premier, in fact, what the cost impacts of the federal crime bill, C-10, would be on British Columbia. At the time she responded: "I am concerned about the costs. We do need to be."

At that time the government had — we know this through freedom of information — assessments of the costs made by public servants, assessments that they have, since then, hidden from the public and the Legislature.

I wonder if the Minister of Justice today can tell us what her government's estimate of the cost impacts of Bill C-10 are.

Hon. S. Bond: As we discussed in the Legislature yesterday, certainly as a government we have been very clear about our support. In fact, this government lobbied for some of the sections that are included in that bill.

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One of the things that we did when we met with ministers and Minister Nicholson directly was that we asked him if he would contemplate looking at the implementation dates of various sections of the bill. In fact, the work continues. We do not have final estimates, as I have said repeatedly in this House.

We were successful in working with Minister Nicholson to look at how the bill might be implemented so that provinces and territories are better able to manage with any — if there are any — pressures as a result of that bill.

Mr. Speaker: The Leader of the Opposition has a supplemental.

A. Dix: The minister will know that there was no discussion of this in the budget tabled by her colleague the Minister of Finance, and the minister will know that she had prepared, for her and for her colleagues, a document on November 3 that lays out, presumably, the government's own view of what the cost of the bill would be to taxpayers in British Columbia.

Could the minister explain why she doesn't share that information? Just share the information, the briefing note that she has. It has been requested by the media. It has been requested by British Columbians. It has been requested by the opposition. Why doesn't she share her best information with the people of B.C.?

Interjection.

Mr. Speaker: Member.

Hon. S. Bond: One of the things that I've said…. And I'm not defensive about that at all. I think that before we raise numbers, we need to be very sure of the actual impacts. It's not as simple as saying: "Bill C-10 equals this." In fact, crime rates are down in British Columbia. What we've seen in corrections capacity is that actually, the number of people in incarceration.... That number is dropping.

We are being careful, and we are being thorough. The fact of the matter is that where there may be some pressures — and we recognize there may be — is in corrections capacity. What we've done is…. We have the most aggressive plan ever in the history of this province to add corrections capacity. We're going to continue to do that.

I'm not going to simply indicate numbers that I don't think we can actually get to the bottom of until we know when the bill will be implemented, the sections, when we analyze the crime statistics, and when we look at what the legitimate impact of Bill C-10 might be.

Mr. Speaker: The Leader of the Opposition has a further supplemental.

A. Dix: The government in general — even this government — doesn't generally function to wait until costs
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occur and then estimate them afterwards. The government has in fact produced information on this. Surely, the Minister of Justice will agree, because we've seen the notes. They've just taken out the information. We see the headings, but they've taken out the information — right?

It seems reasonable to us. Everybody knows you can't be exact in assessing costs in advance. We were all there in the 2009 election campaign. But the reality is, I think, that what we might reasonably expect is to get access to this information as legislators. I think that's a reasonable view. The Minister of Finance himself has acknowledged that these are legitimate questions for us to ask.

Surely, if they're legitimate questions to ask, they're legitimate questions to answer.

Interjections.

Mr. Speaker: Members.

A. Dix: The minister and I are not entirely in sync today, but that's okay, so I'll just ask her.

I think it's a reasonable question. I'm not asking the minister to entirely and accurately and precisely predict. I am asking the minister to provide the best information that the government has on an important public policy issue in British Columbia.

Hon. S. Bond: I think one of the things that we actually believe is important is to be accurate and to be precise about the work that we are doing. We know this. We can't predict the crime rate. We know it's going down. We know that the number of people in incarceration in our facilities is dropping.

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We also know this, and I know that firsthand. We cannot predict sentencing patterns. We have no way to accurately assume how Bill C-10 will be translated, either on the street or in the courts. We're doing our work. We're going to continue to look at how all of those factors are contemplated.

In fact, we made progress with the federal minister by saying we need to make sure that provinces and territories — and British Columbia led that discussion — have the ability to have some time.

Minister Nicholson agreed with that and, in fact, is looking at how the bill will be implemented and working constructively with provinces to allow them to manage any potential challenges we may face.

K. Corrigan: I think this province is in a pretty sorry state if the minister and the government cannot provide any estimate, like both Ontario and Quebec have done.

I'm going to go back. The minister now says it is impossible to do, but we know that there was an estimate that was done in November. I'm going to talk specifically about that.

On January 25 the opposition received an FOI package on the matter of the federal crime bill costs. The package…

Interjection.

Mr. Speaker: Member.

Continue, Member.

K. Corrigan: …included a very heavily censored briefing note from November 3. Several months later a media outlet received a package on the same matter, and it also included the same briefing note. However, their version included key headings that say "predicted costs" — costs, British Columbia costs.

To the Justice Minister: it's time to be up front and honest with British Columbians. Will you just release the briefing document uncensored and also tell us how much we're on the hook for?

Hon. S. Bond: Well, I think it's very interesting that the member opposite's interest in incarceration seems to stop at her own border. Clearly, the member opposite was on record suggesting that that wouldn't happen in her backyard, so it's very interesting that today there is a new-found interest in incarceration.

Here's what we've done. We've already seen new cells put in place in Prince George. We are going to add 104 cells at Alouette Correctional Centre for Women, which will open in 2012; 216 cells at Surrey Pretrial Services, which will open in 2013. In fact, we recently announced an additional over 300 cells in the Okanagan to deal with any capacity issues that may exist.

Mr. Speaker: The member has a supplemental.

K. Corrigan: The minister can divert all she wants, but it is very clear this government generated an analysis as far back as November 3. Quebec said the bill was going to cost hundreds of millions of dollars. Ontario said it's going to be a billion dollars. But the B.C. Justice Minister is hiding the cost from British Columbians.

Again to the minister — a very simple question: will she release the briefing document uncensored, and will she tell British Columbians how much they're on the hook for?

Hon. S. Bond: If the member opposite had done the complete homework…. When Ontario actually suggested their $1 billion number, we might want to point out that the primary cost, the vast majority of that, was for one correctional facility. We're adding cells at Alouette, we're adding new cells in Surrey, and we're adding a brand-new facility in the Okanagan.

I want to assure the member opposite of this. We want to make sure that people who behave inappropriately
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with children, who deal in human trafficking.... We're prepared to make sure that we can pay for whatever pressures there may be. We're going to make sure that Bill C-10 is effectively working in British Columbia to ensure that people who commit those kinds of crimes do the time.

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PRIVATIZATION OF
LIQUOR DISTRIBUTION

S. Simpson: No leading industry groups that we can find were consulted on this liquor privatization before the announcement. We also can't find any industry groups who asked for this change or support it as good for their sector. They all believe that this is heading for the Alberta model, and as we've been told by group after group, that will lead to increased costs. The craft breweries have said they pay double in Alberta what they pay in British Columbia.

Jay Chambers, the head of the Liquor Distribution Branch, at the one May 9 briefing for industry when industry raised their concerns about costs and whether or not they would have any more say on this, said, "We're on a very tight timeline," so as a consequence, any proposals by the successful bidder, they won't be consulted on.

No consultation before the fact. No consultation on any proposals that'll come back in the RFP. No business case at all. My question is to the minister. Why has the minister shut industry out of this issue that they don't support?

Hon. R. Coleman: As the member knows, we're currently exploring ways to better manage liquor distribution and warehousing in British Columbia. There is an RFP on the streets. That RFP is going to come in with some bids. There was consultation with industry. Industry people were talked to before. There was actually a consultation meeting that the member actually referred to in his own question.

I said the other day — and I say it again — I don't know what you're afraid of. Even the BCGEU is working with us on this one. As a matter of fact, this may be an opportunity to modernize a warehouse and a system at a benefit to the taxpayer without having to pay millions and millions of dollars of government capital to accomplish the fact.

Mr. Speaker: The member has a supplemental.

S. Simpson: Industry doesn't support this proposal. The BCGEU doesn't support this proposal. They went to a briefing on May 9 where industry group after industry group asked questions about pricing and about costs and got no answers at all. That's not consultation.

The only value here…. You've got an inventory that you're going to sell anyways. You've got a piece of real estate. Other than that, the government has provided no evidence of a benefit to British Columbia or to consumers. Instead, you have an industry telling us that they fear a model that will double their costs for distribution.

My question to the minister is this. What is the economic advantage to British Columbians? What is the advantage to industry? Can you produce one single report that supports this foolish, foolish idea to privatize?

Hon. R. Coleman: The louder you yell, the worse the question comes out, hon. Member, so you might try a different attack.

The reality is this. Why don't you wait and see what the results of the RFP are? Maybe you'll find out that we'll save millions of dollars in not having to build a brand-new warehouse, and we'll find efficiencies in the system that will benefit all consumers in British Columbia. You can actually….

I know the socialist-communist thinking is that everything should be nationalized and controlled. If you had your way, you probably would nationalize mining, nationalize natural gas. You would nationalize everything, because you don't believe in the private sector. But we believe that the private sector may have solutions to improve this and save us money in the future.

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COMMUNITY LIVING SERVICES
AND CLIENT INTERACTION
WITH CRIMINAL JUSTICE SYSTEM

N. Simons: This government has spent pretty much the last year denying that there's a problem with CLBC. They later admitted that maybe it has lost its way, but it still hasn't got it right.

Derek Wiebe-Rosch is a developmentally disabled young man in the care and supervision of CLBC. That care has been declining over the last three years, just as his ability to participate in the community has declined.

In April he was charged with armed robbery in Kamloops, and he's now facing an uncertain future, possibly in jail. This government has failed Derek. Isn't it both socially and economically inappropriate for CLBC to rely on the justice system to deal with its failures?

Hon. S. Cadieux: Well, perhaps the member has missed the comments I've made over the last six or more months, because I have been very clear that there were indeed issues and that we as a government are absolutely committed to finding solutions to those issues. That's why we did the comprehensive review.

In January we released the deputy minister working group's report, which had a 12-point plan that we are committed to working through and addressing all of the issues in the plan. In fact, that's exactly why this govern-
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ment committed an additional $179 million over the next three years to support people with developmental disabilities.

Mr. Speaker: The member has a supplemental.

N. Simons: When a child is born with developmental disabilities, MCFD supports that child. When they turn 19 and transition into CLBC, their needs do not decrease. But under this government, it's business as usual — under-resourcing and over-relying on the justice system.

Derek is not the only young man facing this. The Representative for Children and Youth has pointed to other cases. In his case it wasn't of his own making.

Wouldn't the minister agree that it is time to do something real? Why should the developmentally disabled continue to pay for this government's incompetence?

Hon. S. Cadieux: I am a little surprised by the question from the member, seeing as how we met just the other day to discuss the progress we're making on the 12-point plan.

We absolutely recognize that there are challenges in the system. Some of those challenges are exactly what the member references. We have acknowledged that in that we need to do a better job of working across government and having a one-government approach.

Since January a cross-ministry team, interministry team — including the Ministries of Social Development, Children and Families; Health; Education; and Community Living British Columbia — have been working and continuing to work diligently to develop an integrated service delivery model for the future.

ACCESS TO WASHROOMS IN
INCOME ASSISTANCE OFFICES

M. Sather: Income assistance clients can wait for hours for service. Many are young mothers who bring their children with them. Yet at the Maple Ridge office public access to the washrooms is not allowed to clients. It's not as though there aren't any washrooms there.

The B.C. building code requires that public service buildings provide washrooms, yet the washrooms at the Maple Ridge office have been closed to the clients for a year.

To the Minister of Social Development, can she explain why this office won't allow income assistance clients the basic dignity of being able to use the washroom while they wait hours for service?

Hon. S. Cadieux: To the member, I thank him for bringing that issue to my attention. I'll look into it.

Mr. Speaker: The member has a supplemental.

M. Sather: I have, then, a question for the minister about policy. Is it government policy to refuse washrooms in government offices?

Hon. S. Cadieux: I believe I just answered that question. I'll look into it.

[1420]

COASTAL RESPONSE PLAN
FOR JAPANESE TSUNAMI DEBRIS

G. Coons: With each passing day, more debris from the Japanese tsunami is beginning to wash up on the coast of B.C. Last January the minister said he would begin working with national and municipal officials to get ready. Well, it's four months later, and local communities are still waiting. Regional districts are concerned about landfill issues and what to do with the debris that is being collected.

The mayor of Masset has called for a broader coordinated effort involving all levels of government. Robert Mills, chief councillor of the Skidegate Band, says the Haida's first concern right now is the debris.

To the minister: when is this Liberal government finally going to step in and work with local governments and First Nations to put forward a real plan to deal with the growing tsunami debris on our shores?

Hon. T. Lake: We have formed a joint advisory committee with the federal government. We are working with local governments. We are working with First Nations. We are working with the National Oceanic and Atmospheric Administration in the United States, along with our west coast partners in Washington State, Oregon and Alaska.

There is no doubt that this will pose a challenge for all of us living on the west coast. But we are actively planning. We are working with volunteer groups. Anyone who finds any tsunami debris can go to our webpage, Ministry of Environment, and can register the material. We do ask people to handle it sensitively, because some of that may have real importance to the victims in Japan.

We are coordinating that response, and we will be ready when the majority of that debris arrives on our shores in 2013.

Mr. Speaker: The member has a supplemental.

G. Coons: It appears that the minister's Tsunami Debris Coordinating Committee has failed to do any coordinating as such. An estimated 25 million tonnes of debris is headed for our coast, and it's already hitting our shores. In Washington State all levels of government and the community are working together to respond. Yet here in B.C. the draft meeting minutes from the March 19 Japan Tsunami Debris Coordinating Committee, which the min-
[ Page 12029 ]
ister talks about, noted that neither the terms of reference or the proposed organization structure was ready yet.

On Haida Gwaii last night Masset and Old Massett held a joint council meeting. Ken Rea, chief councillor of Old Massett, asked why the province still hasn't provided any direction. He has a quote: "What's the holdup? Why hasn't the minister begun coordinating with First Nations and coastal communities to start the cleanup process and deal with landfill issues?"

To the minister, will he get on the phone and start coordinating?

Hon. T. Lake: Well, we certainly have started those efforts. At a joint cabinet meeting in Washington State the Premier and the governor discussed this issue. I discussed it with the director of ecology, Mr. Ted Sturdevant. We are working with our Pacific Coast Collaborative members, as I've mentioned. We're working closely with the federal government and First Nations. I've discussed this with the Environment Minister nationally.

Despite what the member opposite may believe, we are coordinating this effort. We are working very closely with all of the members of our team, and we do realize that this will take a huge effort on the part of government and on the part of volunteers up and down the coast. But the sky is definitely not falling. We have time to prepare properly and responsibly. Anyone who finds any debris — I invite them to visit the Ministry of Environment webpage. They can register that debris at that e-mail address.

GOVERNMENT RESPONSE TO
CHANGES TO FEDERAL LEGISLATION
ON FISH HABITAT PROTECTION

R. Fleming: The clock is ticking on major Fisheries Act changes hidden away in the federal government's budget bill, Bill C-38. Many of Canada's core environmental legal protections are about to be lost. These are far-reaching changes that will impact British Columbia's environmental reviews and our protection regime. Yet we have heard almost nothing from this government.

When I asked the minister on previous occasions about how he plans to address these issues, he said he hadn't been consulted and wasn't even aware of the existence of the legislation. The federal budget bill is about to be passed.

[1425]

My question to the minister is this. Does he think it's acceptable for his federal counterparts to make major changes to federal fisheries legislation without consulting the provinces, without consulting fisheries organization, the scientific community and marine industries? And if he doesn't think that's good enough, will he finally speak up for British Columbia before this bill becomes law?

Hon. T. Lake: Well, the federal Fisheries Act has not been updated since the 1970s, and while I remember the '70s fondly, I would say that it's probably about time the Fisheries Act was updated to recognize the changing environment that we have today.

Some of the rules that we have in place force farmers in the Abbotsford and the Mission region and out in Chilliwack to have to treat their irrigation ditches as if these were critical fish habitat. These changes take a risk-based approach to managing fish habitat — a responsible approach.

We will see in the regulations the details of these changes. The federal officials have advised us that we will have plenty of opportunity for input before those regulations are developed. I can assure the member opposite that here in British Columbia, British Columbians expect the highest level of protection for the environment. That's what we will ensure.

Mr. Speaker: The member has a supplemental.

R. Fleming: The minister's answer is completely inadequate, and for this reason. We are going to lose a modern fisheries management model….

Interjections.

Mr. Speaker: Members. Members.

Continue, Member.

R. Fleming: We are going to lose a modern fisheries management model in Canada and in British Columbia and go back 40 years, to a single-species management model — the very same one that led to the Atlantic cod stocks collapse. That is what is at stake in the debate, and we have heard nothing from this government.

Organizations across the province of British Columbia have spoken out against these changes. We have 625 scientists who wrote the Prime Minister and this government expressing concern that the weakening of habitat protections in section 35 of the Fisheries Act "will negatively impact water quality in fisheries across the country."

So before we go 40 years backwards, again to the minister: will he tell the people of British Columbia exactly how he plans to stand up for the interests of sustainability of B.C. fish and the thousands of jobs sustained by our fisheries in British Columbia?

Hon. T. Lake: As my friend the Minister of Finance is fond of saying, nothing should ever change in the NDP world. We understand that. But we actually believe that we should modernize our laws, and this is a modernization after 40 years — to take a risk-based approach, a commonsense-based approach to managing fish and fish habitat.

Interjections.

Mr. Speaker: Members. Members.

Continue, Minister.
[ Page 12030 ]

Hon. T. Lake: With the changes come greater compliance and enforcement activity. That's something we actually think is important.

We do have an opportunity for input. We also have the ability to regulate ourselves, in terms of fish and habitat. British Columbians expect the very highest level of environmental protection, but they also expect common sense. That's what they will get from this government.

[End of question period.]

Tabling Documents

Hon. J. Yap: In keeping with the Multiculturalism Act, it's my honour to table the 2010-2011 report on multiculturalism on behalf of the government of British Columbia.

Motions Without Notice

APPOINTMENT OF
SPECIAL COMMITTEE ON TIMBER SUPPLY

Hon. R. Coleman: Mr. Speaker, you'll notice the specs, because this is the font I'm getting on this one. It's rather lengthy. My age is showing through here.

[1430]

By leave, I move:

[that a Special Committee on Timber Supply be appointed to examine, inquire into and make recommendations with respect to mid-term timber supply for British Columbia resulting from the pine beetle epidemic-related loss of timber supply in the central interior, and to conduct consultations on this issue with the public and local governments, including communities and First Nations, by means the Special Committee considers appropriate, with a final report due August 15, 2012.

The Special Committee shall specifically consider:

1. Recommendations that could increase timber supply, including direction on the potential scope of changes to land use objectives, rate of cut and the conversion of volume based to area based tenures; and

2. Areas requiring change to legislation and/or other key implementation tools.

The above considerations should occur with due regard for the following:

•   Fiscal commitment of the province to balance the budget and maintain competitive electricity rates;

•   Maintaining high environmental standards and protection of critical habitat for species and key environmental values;

•   Optimal health of communities and as orderly a transition as possible to post beetle cut levels;

•   Maintaining a competitive forest industry;

•   The existence of First Nations rights and claims of title; and

•   The Softwood Lumber Agreement and other trade agreements.

The Special Committee so appointed shall have all the powers of a Select Standing Committee and is also empowered:

a. To appoint of their numbers, one or more subcommittees and to refer to such subcommittees any of the matters referred to the Committee;

b. To sit during a period in which the House is adjourned, during the recess after prorogation until the next following Session and during any sitting of the House;

c. To adjourn from place to place as may be convenient;

d. To retain Jim Snetsinger and Larry Pedersen as technical advisors, and any other personnel as required to assist the Committee;

The said Special Committee shall report to the House no later than August 15, 2012 and shall deposit the original of its reports with the Clerk of the Legislative Assembly during a period of adjournment and upon resumption of the sittings of the House, or at the next following session, the Chair shall present all reports to the Legislative Assembly.

The said Special Committee be composed of: Mr. Rustad (Convener); Ms. Barnett, Mr. Foster, Mr. Stewart, Mr. Bains, Mr. Macdonald, and Mr. B. Routley.]

Leave granted.

Motion approved.

APPOINTMENT OF SPECIAL COMMITTEE TO
APPOINT A CONFLICT OF INTEREST
COMMISSIONER AND MERIT COMMISSIONER

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

[That a Special Committee be appointed to unanimously recommend to the Legislative Assembly the appointment of:

(1) a Conflict of Interest Commissioner pursuant to section 14 of the Members' Conflict of Interest Act (RSBC 1996, c.287); and

(2) a Merit Commissioner pursuant to section 5.01 of the Public Service Act (RSBC 1996, c.385);

and that the said Special Committee shall have the powers of a Select Standing Committee and in addition is empowered:

a) to appoint of their number, one or more subcommittees and to refer to such subcommittees any of the matters referred to the Committee;

b) to sit during a period in which the House is adjourned, during the recess after prorogation until the next following Session and during any sitting of the House;

c) to adjourn from place to place as may be convenient; and

d) to retain such personnel as required to assist the Committee;

and shall report to the House as soon as possible, or following any adjournment, or at the next following Session, as the case may be; to deposit the original of its reports with the Clerk of the Legislative Assembly during a period of adjournment and upon resumption of the sittings of the House, the Chair shall present all reports to the Legislative Assembly. The Committee may consider and report on items (1) and (2) concurrently or sequentially.

The said Special Committee is to be composed of Colin Hansen (Convener), Ron Cantelon, Joan McIntyre, Mable Elmore and Leonard Krog]

Leave granted.

Motion approved.

M. Elmore: I seek leave to make an introduction.

Mr. Speaker: Proceed.

Introductions by Members

M. Elmore: I'd like to welcome to the House today students from St. Andrew's School — 30 grade 4 students
[ Page 12031 ]
— accompanied by six adults and Mr. Adam Quan. I just ask everyone to make them welcome.

Hon. M. de Jong: Leave for an introduction, Mr. Speaker.

Mr. Speaker: Proceed.

Hon. M. de Jong: Two UBC students, pursuing their doctor of pharmacy degrees at UBC. They are doing a rotation through the Ministry of Health. The students are Celia Culley, a former resident of Prince George who previously worked as a community pharmacist in La Ronge, Saskatchewan, and Michelle Hinch, who was most recently a pharmacist at Vancouver General Hospital. I hope that the House would make both of these ladies welcome.

[1435]

Orders of the Day

Hon. R. Coleman: In this chamber this afternoon we will start second reading of Bill 54, intituled the Provincial Sales Tax Act, and — in my scope of being the eternal optimist — should that complete, we would then go to second reading, continued, of Bill 51, intituled South Coast British Columbia Transportation Authority Amendment Act, 2012.

In the Birch Committee Room we will be doing the estimates of the Ministry of Health. When that completes, we would then move to the Ministry of Justice and Attorney General.

In the Douglas Fir Committee Room this afternoon we will be doing committee stage of Bill 41, intituled Miscellaneous Statutes Amendment Act (No. 2), followed by committee stage of Bill 36, intituled School Amendment Act, followed by Bill 37, intituled Animal Health Act, and Bill 39, intituled Emergency Intervention Act.

For the information of the House, one minister may be under the weather, and we may have to switch a couple bills around, but I would advise the House in advance of that.

I have been reminded by the Clerk. Just so members understand the operation, the Government House Leader and the Opposition House Leader have agreed that divisions taken in the committee rooms would then be deferred to the House of the Whole. The membership of the House would be able to vote at the end of the day. So when division is called, it will be deferred to the House, and all members would be advised.

One other thing that we've agreed to, Mr. Speaker, in the spirit of cooperation: when we sit evenings and late, we will be taking a dinner, a half-hour break, between 6:30 and seven.

Second Reading of Bills

BILL 54 — PROVINCIAL SALES TAX ACT

Hon. K. Falcon: I move that Bill 54, the Provincial Sales Tax Act, 2012, be read a second time.

Mr. Speaker: Proceed.

[L. Reid in the chair.]

Hon. K. Falcon: Bill 54 implements the provincial sales tax. I would like to take a few moments to speak about the events that led us here today.

In the summer of 2011 British Columbians had the opportunity to participate in a provincewide referendum on the harmonized sales tax and voted to eliminate the HST and return to the PST-plus-GST system.

Clearly, I, along with many others, was disappointed in that result and would have preferred a different outcome. I genuinely believed, and still believe, that the HST would have enhanced British Columbia's competitiveness and led to long-term economic growth — something that is in the best interests of all British Columbians.

However, we respect the decision that was made by British Columbians, and we committed to them to make the transition back to the PST as quickly as responsibly possible. Bill 54 meets that commitment, and subject to the approval of this Legislature, the new provincial sales tax will be implemented, effective April 1, 2013.

The new provincial sales tax, or PST, will tax the same goods and services that were previously taxed under the Social Service Tax Act, the old PST act, and the Hotel Room Tax Act. The general PST tax rate will be 7 percent, and as I promised on August 26, 2011, all permanent PST exemptions will return.

The reimplementation of the PST is a huge project. Countless hours have been spent over the last several months by staff in both the Ministries of Finance and Justice to work towards meeting government's commitment to reimplement the PST.

[1440]

You may recall, Madam Speaker, the independent panel that reviewed the HST — which was chaired by a former Alberta Finance Minister and included among its distinguished panel members the former Auditor General of British Columbia George Morfitt — concluded that it would take 18 to 24 months to reinstate the PST. I am pleased to say that we are on target to complete the reinstatement of the PST at the low end of this timeframe, at 19 months.

There is still very much work to be done, both on regulations and legislative amendments, and on the systems and many other critical steps required to begin administrating the PST.

Some have asked: "Why does it take so long to bring
[ Page 12032 ]
back the PST? Why can't it just be done right away, bringing back the old PST act as it was, and why does it take longer to reimplement the PST than it did to implement the HST?"

Well, let's start with the fact that the old PST act was originally introduced over 60 years ago, in 1948. That was back in the day when we had Prime Minister Mackenzie King and when President Harry Truman was the president of the United States. That was when the old PST act was introduced in British Columbia.

Over the years successive governments have made many, many changes to the act, adding or removing exemptions, changing how various goods and services are taxed, implementing tax on new items and so on and so on. There were also a number of amendments to respond to legal challenges and changing business practices over the years.

During that time there have been seismic changes in technology since the old PST act was introduced, changes which continue to this very day. Telecommunications and software, for example, look far different today than they did even five or ten years ago.

All of those things led to the old PST act being a complex compilation of rules, regulations and requirements from many different eras. It was deficient, unclear and unwieldy, and sometimes totally incomprehensible, even to tax professionals.

The on-the-ground application of the PST, in other words what people were actually paying, often had to be based on administrative interpretations, as the words in the legislation itself were not at all clear. Not being able to refer to the legislation and understand how it applied in their specific circumstances led to confusion and frustration for both taxpayers and businesses.

If we had reimplemented the old PST act without amendment, which certainly would have been a far less difficult and time-consuming task, at least from a legislative perspective, the confusion and the frustration would have continued. This is why I was so strongly in disagreement with the Leader of the Opposition, who advocated returning to the old PST as it was. Indeed, he wanted to have it implemented and said that he would have had it implemented by June 1 — in other words, a short two weeks from now.

Well, on this side of the House we believe that what people voted for was to go back to the PST they were paying, not to enact an outdated and archaic piece of legislation. So that's what we committed to do, and we are doing that with this new legislation.

The new PST Act implements a tax that applies to the same goods and services and provides for all the same permanent exemptions as the old PST and hotel room tax, but in a new, modern, clear and more comprehensive act. We also wanted to ensure that, to the extent possible within the time available, we made improvements to the new PST Act to reduce the overall compliance burden on business.

Changing a province's sales tax system isn't a quick or easy thing to do. It is very complex, perhaps the most complex undertaking for both business and government. There are a series of steps that need to be taken. In addition to rewriting provincial tax laws and regulations and developing and legislating the transitional rules, we need to rebuild our capacity to administer the PST.

Even when we implemented the HST, it took many, many months. With harmonization, British Columbia was really just eliminating one tax, the PST, and changing the rate of an existing tax that businesses were already familiar with. In most ways, the HST is just the GST at a higher rate, incorporating the PST. That was why for most people out there 80 percent of the purchases that they were involved in making did not change. It was still 12 percent — the 5 percent GST and the 7 percent PST.

[1445]

Reimplementing the PST, however, is much different. It is not just changing the rate of an existing tax. It is introducing a second, entirely separate tax for government to administer and for businesses to comply with.

Businesses, particularly small business, need time to prepare to comply with a second tax with its own set of rules and procedures that are separate from and, in fact, in addition to those that they have to follow under the GST. They have to readjust their accounting and administrative systems and prepare to collect a second sales tax.

By the time the transition is complete, about 30,000 new businesses in B.C. will have started up under the HST. They will have had had no prior experience dealing with the PST — ever. They will need time to learn to administer the PST and to understand what their obligations are with respect to the PST.

That is just a brief overview and explanation of some of the critical steps that have to be required to get to this point, and those that are still to come. But it is an important point, because as a government we have a responsibility — I would argue, a supreme responsibility — to act, not even in our collective political interest.

Many have pointed out how the April 1 introduction of the new PST may not be convenient for us politically, being as it is a couple of months away from an election. That is indeed true. But what this Finance Minister and this government will never do is put an artificial date in place that would mean we would risk the implementation being done in a smooth manner that would allow business the ability and the time to transition and government the ability to get back our administrative capacity to properly supervise, implement and administer the PST.

As I have mentioned, British Columbia's new provincial sales tax will be implemented effective April 1, 2013, and will tax the same goods and services that were taxed under the old PST. All of the permanent PST exemptions will also be implemented.

Madam Speaker, I would like to provide a brief overview of Bill 54, the Provincial Sales Tax Act, itself.
[ Page 12033 ]

Like the previous PST, the new PST is a retail sales tax that is payable when a taxable good or service is acquired for personal use or business use, unless a specific exemption applies. Bill 54 imposes tax on the purchase or lease of tangible personal property, or TPP, which is commonly referred to as goods. It also imposes a tax on goods brought, sent, delivered or used in B.C., on purchases of software and on certain services — accommodation; legal services; telecommunication services, including digital media, non-basic cable and non-residential telephone services; and services provided to goods.

This act also provides the legal authority for all exemptions from PST and refunds of PST. This is the case even where the specifics of an exemption or refund will be located in the regulations. Bill 54 also establishes the framework for the administration and enforcement of the PST and the appeal mechanisms that were generally in place under the previous Social Service Tax Act and the Hotel Room Tax Act and that are similar to administrative schemes established under other provincial taxation acts.

The Provincial Sales Tax Act also implements a number of taxes that were part of the old PST, including the $1.50-per-day passenger vehicle rental tax, the surtax of 1 to 3 percent on passenger vehicles with a purchase price of $55,000 and over, the multi-jurisdictional vehicle tax and the tax on energy products to raise revenue for the ICE fund.

In addition, Bill 54 makes consequential amendments to the Income Tax Act. With the elimination of the HST, the B.C. HST credit will also be eliminated. The final quarterly B.C. HST payment will be issued in January of 2013.

[1450]

Effective for 2013 and future tax years, the B.C. sales tax credit will be reimplemented and will have the same eligibility criteria and benefit calculation as existed prior to its replacement by the B.C. HST credit.

As part of the HST implementation, the basic personal amount tax credit was also increased. This enhancement will be reversed with the reimplementation of the PST on April 1, 2013, back to its original amount.

For the reasons I mentioned earlier, clarifying the legislation and improving administration for businesses, the format and structure of the Provincial Sales Tax Act is significantly different from the format and structure of the Social Service Tax Act. Among the clarifications are the updating and clarifying of the provisions for taxation of software and taxation of services performed to goods to reflect modern technology and provide greater certainty.

With the restructuring of the act, related provisions are now located together, to the extent possible, to improve readability by reducing the need for people to look at multiple sections of the act and regulations to determine the correct tax application — one of the great frustrations for small business, big business, all business under the previous PST.

I would also like to provide some information about the numerous regulations under the Provincial Sales Tax Act. While Bill 54 provides the legal authority for all exemptions from PST and refunds of PST, the regulations will contain the specifics and details of most PST exemptions and some refunds.

For example, as under the Social Service Tax Act, all specifics and details of the exemption for production machinery and equipment will be in regulations under the Provincial Sales Tax Act. Certain exemptions and refunds are included in the PST Act itself. The exemptions and refunds included in the PST Act are those which are generally more fundamental to the overall taxation system as a retail sales tax system — for example, exemptions for goods incorporated into goods for resale.

I would like to reiterate that all of the permanent PST exemptions and refunds will be implemented, regardless of where they were previously located in the old PST, in hotel room tax legislation and regulations.

Permanent exemptions include, among others, all food for human consumption — for example, basic groceries and prepared foods such as restaurant meals — most services, admissions and memberships, bicycles, books, newspapers and magazines, children's clothing and footwear, and all permanent PST exemptions for business.

The regulations will also contain many administrative and related requirements, including the requirements related to remittance and payment of tax, returns, commissions for businesses who collect and remit taxes required, documentation and recordkeeping requirements and others.

In addition to the PST legislation itself, returning to the PST system requires that we make numerous consequential and related amendments to other acts and regulations under various acts. The implementation of the new PST will require amendments to repeal the Hotel Room Tax Act and the Consumption Tax Rebate and Transition Act.

We will also be introducing consequential and related amendments to a number of other acts, including the Motor Fuel Tax Act, the Carbon Tax Act, the Tobacco Tax Act and many others. Amendments to treaty-related tax agreements with First Nations will also be required.

Bill 54 does not contain the consequential and related amendments to other acts, with the exception of the amendments to the Income Tax Act or the transitional rules. The housing transitional rules which were announced in February, with a detailed backgrounder, will be legislated in a separate, soon-to-be introduced act. As announced in Budget 2012, generally, PST will apply where a tax becomes payable on or after April 1, 2013. The general PST transition rules will include detailed rules for specific types of transactions, including goods brought, sent or delivered into B.C. and goods used in the improvement of real property.

In addition, we plan to make additional changes to
[ Page 12034 ]
the legislation to provide as much clarity and certainty to British Columbians as possible and to make further administrative improvements as time permits.

[1455]

The consequential amendments, transitional rules and other amendments will be legislated at a later date, prior to the implementation of the PST on April 1, 2013. To provide greater certainty for businesses preparing for the transition, we plan to publicly release a proposed final version of the PST legislation, which includes the transitional and other amendments, this fall.

While we are continuing to look at ways to improve the PST legislation and administration, I'm pleased to report that we are making a number of improvements to the PST with this bill. The intent of the improvements and changes we are making is to reduce the administrative and compliance burden on businesses by making it easier for businesses to collect and remit tax on sales and leases.

Compared to the old PST legislation, the new PST legislation provides greater certainty about what is taxable, when tax is payable, and when tax is to be levied and collected. The improvements will also help to streamline administration for both business and government.

Under the old PST system, accommodation was taxed under a separate tax statute, the Hotel Room Tax Act. Now the tax on short-term accommodation is included in the new PST Act, and the separate Hotel Room Tax Act will be repealed. The tax rate will remain at 8 percent, the same rate as prior to the HST.

The integration of the tax on accommodation into the new PST Act will reduce the compliance burden on the hotel operators who also had to collect the old PST. Therefore, they had to deal with two separate acts, two separate paperwork requirements, two separate remittance requirements, etc. This integration results in these businesses now having one registration requirement instead of two and one less return to file.

As announced in Budget 2012, the tax on private sales of vehicles, boats and aircraft will continue at a rate of 12 percent to ensure similar tax treatment between private sales and sales by GST-registered businesses. To simplify administration and compliance, similar to the tax on short-term accommodation, these transactions will be taxed under the new PST Act rather than under a separate act.

We also made changes and clarifications to close loopholes and address tax avoidance to ensure that taxpayers are treated fairly and equitably. One such change is that — to close the loophole which was unfair to those taxpayers who properly paid tax and to reduce the potential for significant tax avoidance — gifts of vehicles, boats and aircraft provided in B.C. will be treated the same as those from out of province.

Under the old PST, transfers of vehicles, boats and aircraft were subject to tax if any money or other consideration was provided. Unfortunately, to avoid paying tax, people often claimed that an item was provided as a gift rather than purchased.

There will be an exemption where the donor previously paid tax and the gift is from a family member or an inheritance, prize or donation to a registered charity. This is generally consistent with the treatment of gifts in other provinces across the country.

Another improvement to the PST Act is that it provides broad legal authority for businesses to refund or credit tax directly to their customers in a range of circumstances. Previously this ability was very limited. The new PST Act also provides authority for businesses to deduct refunds provided to their customers from their tax remittances, streamlining the process dramatically.

I'm not saying that the new PST Act is "simple" or that the legislation itself is short or even totally streamlined. Tax acts by their very nature are complex and detailed. However, significant efforts have been made to improve the readability, clarity and certainty provided by the new PST Act, especially when compared to the old PST act.

We also plan to provide further improvements with the regulations. One of these planned improvements is the extension of the due date for tax returns on sales and leases filed by businesses — from 23 days after the last day of the reporting period, which was the requirement under the old PST, to the last day of the month following the reporting period. This will provide increased consistency with the GST due dates, easing the compliance burden, again, for businesses.

[1500]

As I mentioned earlier, changing sales tax systems is an incredibly large and complex undertaking. While there is still much to be done, I would like to recognize the significant achievement this act represents and the incredible amount of work, time and expertise put into this project by staff at the ministries of both Finance and Justice.

It is truly a testament to the professionalism and competence of our professional public service that they have achieved so much in such a tight time frame, and I really want this House to understand and recognize that contribution.

Finally, I would like to put all this into perspective. We know that keeping taxes low is an essential part of maintaining a competitive tax environment that will attract investment, create jobs, and build confidence and certainty. In British Columbia, as you know, our general corporate income tax rate is among the lowest of the G7 group of countries. That is the largest group of trading economies that B.C. typically trades with. B.C. has one of the lowest small business corporate income tax rates in Canada.

We have provided reductions over the last decade of about 40 percent on average in our general corporate and small business tax rates in British Columbia. B.C. families and individuals generally have one of the lowest overall tax burdens in the country of Canada.
[ Page 12035 ]

While the return to the PST system does reduce revenues, and it does create challenges for governments — any government, this one and future governments — we remain committed to balancing the budget in 2013-14 through continued fiscal discipline.

If there is any message that we have seen from what is taking place around the world in this time of great global uncertainty, it is that those governments that have not paid attention to maintaining fiscal discipline, that have not had the fortitude to say no….

Whether it was to providing wage increases they couldn't afford to their public service or whether it was providing tax breaks that they couldn't afford to finance or whether it was making investments that they couldn't afford and were borrowing dollars to make all of those investments, all of that has created a situation where today around the world we see governments reaping the whirlwind for not having that kind of discipline.

Whether it's Italy or Spain or Greece or Portugal or Ireland or even some of the great nations, the United Kingdom and France, they still suffer under a major burden of 75 to 80 percent debt-to-GDP ratios, meaning that their debt in relation to the size of their overall economy is at a level that is extremely worrisome in terms of their ability to pay it.

Here in British Columbia we can be so proud of the fact that we have one of the lowest debt-to-GDP ratios in the world. We will peak at 18 percent. [Applause.] Thank you.

The three credit-rating agencies, the major credit-rating agencies, have recently reaffirmed B.C.'s triple-A credit rating. They reaffirmed it after providing us seven successive credit-rating upgrades over the last decade, reflecting and sending a powerful message to investors around the world who are looking for stability and certainty in an uncertain world. That is a great strength that we have as British Columbians, a great advantage that we have that so many other jurisdictions do not enjoy today.

New investment will be the key. It will be the key to protecting and creating jobs in every region of the province of British Columbia — which, in turn, supports the public services that all British Columbians expect and want to see.

While the PST, in all candour, doesn't come anywhere close to providing the same benefits as the HST with respect to B.C.'s economy and for B.C.'s business community, British Columbia continues to have a very competitive tax environment, and British Columbia continues to be a great place to live, to work, to build a business, to start a family, to raise a family and to build a future.

With that, I conclude my remarks.

[1505]

B. Ralston: I'd like to begin my remarks by reflecting a bit on some of the arguments and some of the history that have taken place during the course of the debate on the HST, which has really convulsed the province and introduced economic uncertainty since it first became public back in July of 2009.

I think it's important to do that. The sense one gets from the minister…. He expressed it very graphically the other day. In response to a reporter's question, and he was asked if the PST is still a stupid tax, he said: "Yes, but better stupid." I think that's a serious problem, and I think perhaps the minister might regret having said that, and here's why.

This debate took place over a number of years. There's very full debate. The government certainly deployed a lot of government resources, spent millions of dollars on advertising, rejigged the HST tax — or proposed to rejig it — and yet the result was a very decisive rejection by the citizens of British Columbia.

To use that kind of language…. I understand that the minister is committed to his position and doubtlessly frustrated — and I think he's pretty well said as much — that the electors of B.C. didn't agree with him. Be that as it may, I think it's important, in a democracy where this kind of huge sweeping public debate took place, to exhibit, as a quality of leadership, a respect for the verdict of the people of the province.

I'm not sure. Perhaps the minister's statement was inadvertent, perhaps off the cuff, but I'm not sure it exhibits the kind of respect that one would wish for. I think that's a bit troubling.

Let me take as my text for today the words of another Finance Minister, a different Finance Minister from this one, the former B.C. Liberal Finance Minister Carole Taylor, who presided over, as we are aware, a number of surplus budgets and who left shortly before the 2009 election. I think her last day as an MLA coincided with the end of the calendar year of 2008.

She was interviewed on April 22, 2010, as a guest on a CTV news program, and she said this about the HST.

"One is, of course, that no one likes new taxes. This particular tax takes the tax off of businesses — it takes $1.8 billion off of businesses — and puts it on consumers. That shift is a shift that is ideological as well as factual.

"So many people will be paying a 7 percent increase on a lot of services and consumer goods, so there's a really strong reaction against that. But I think the bigger issue is that just before the election he promised that they would not, that they would not" — she repeated it twice — "do the harmonization of the sales tax, then right after the election decided to do it."

The sense that we have from the debate is that somehow a brilliant policy initiative was thwarted by the failure of the public to understand that brilliance, that quality of tax policy that was being brought forward in the debate. I don't think that's the case at all. I think that is why it's useful to reflect upon the words of a former Finance Minister, a B.C. Liberal Finance Minister, who sat around the cabinet table with the present Finance Minister for a period of time. That was her considered judgment, offered publicly on a national television news program.
[ Page 12036 ]

Looking at what she said, "That shift is a shift that is ideological as well as factual," I think that is key. Doubtlessly, the minister, as the Minister of Finance and the person who led the campaign…. Although the Premier certainly supported it, but she did not take a leading role for reasons perhaps strategic, perhaps best known to herself. I'm not sure.

[1510]

This Minister of Finance led the campaign to convince the public of the wisdom of the HST, even the new recontoured HST. When we look back…. I think it's important to reflect on the referendum results. Notwithstanding all of the government firepower — the ads that were purchased, the campaign, the town halls, the effort to pressure and persuade people that was provincewide in a very intense way — the public in the referendum result announced on August 26, 2011, decisively rejected the HST.

The question, as many will recall, was: "Are you in favour of extinguishing the HST, harmonized sales tax, and reinstating the PST, provincial sales tax, in conjunction with the GST, goods and services tax?" Yes or no. The provincial results was yes, 54.73 percent, and no, 45.27 percent. That's a fairly clear rejection.

I think the media rounded that up to 55 percent to 45 percent. A ten-point margin in electoral terms is a huge chasm. That's a fairly decisive result, particularly in British Columbia, where historically general elections are often decided by a redistributed several thousand votes that might have made the difference.

It's also significant — and this is something that I think should be reflected upon and perhaps more contritely approached — that in a number of ridings held by Liberals, the result was a decisive rejection of the HST. I think that's important to note, just given the rationale that's being put forward and the reluctance to embrace the referendum result that has led to the bill that is before us, Bill 54, which will reinstate the PST in accordance with the direction given by the people of the province.

Let's look at a few of those results, just to emphasize the point that this was not a fracture that occurred along necessarily party lines in many ridings.

For example, in Boundary-Similkameen the vote in favour of getting rid of the HST was 59.48 percent; Burnaby-Lougheed, 58.77 percent; Burnaby North, 60.34 percent; Cariboo-Chilcotin, 56.9 percent; Coquitlam–Burke Mountain, 55.85 percent; Kamloops–North Thompson, 54.73 percent; Maple Ridge–Mission, 55.8 percent; Parksville-Qualicum, 51.57 percent; Peace River South, 58.82 percent. And it's significant there that the member who was a member of cabinet resigned at one point from cabinet to protest the imposition of the tax.

Prince George–Mackenzie, 56.92 percent; Prince George–Valemount, 58.73 percent; Vancouver-Langara, 61.65 percent; Surrey-Tynehead, 59.47 percent; Surrey-Panorama, 53.33 percent.

Interjection.

B. Ralston: Well, the minister asks about his own riding. I can give him the result for his riding — 47.55 percent in favour of extinguishing, 52.45 percent rejecting that. In my riding, Surrey-Whalley, another riding in Surrey, 68.88 percent in favour of rejecting it, going as high as in Surrey–Green Timbers, 75.51 percent; Surrey-Newton, 72.22 percent; and Surrey-Panorama, 53.33 percent.

Deputy Speaker: Member, if I might bring you back to the contents of the bill.

B. Ralston: Thank you. Well, I appreciate you bringing me to heel at this point, because I'd finished reciting those numbers. The reason I recited them, Madam Speaker, is that this debate that took place was not a debate that divided along the traditional party lines.

[1515]

Indeed, all the constituencies I've cited, with the exception of those in Surrey — just for context for the minister because he represents a Surrey riding, Surrey-Cloverdale — were Liberal seats. Not only was the HST rejected in NDP-held ridings; it was strongly rejected in a number of Liberal ridings.

I think the minister, at his peril, really fails to accept the verdict of the people on this referendum, an unusual seismic event in B.C. political history. Frankly, I don't think we're well served by that approach. But he's entitled to his opinion. I'm sure he's certainly rejected my advice on occasion before, and he continues to do that.

What we now see in the debate and the direction that the debate has evolved, which was reflected in the speech that the minister just made, is that what is attempted to be portrayed in recasting the political history of this is that it was a debate between the wisdom and brilliance of the tax policy that would have continued the HST and the much inferior PST. But in fact, that wasn't the motivation for introducing the HST at all.

The political arguments and the economic arguments in support of the HST were only constructed after the fact. I think it's important at this juncture — when we're discussing Bill 54 and reflecting on how we got here and why this bill is before the House and why the minister has characterized it in the way that he has — to think back and look at a little bit of the political history surrounding the events that led to this.

I was reviewing a speech in preparation for this one, a speech that I'd made previously upon the introduction of the HST legislation. I won't go into that level of detail, but I think it is worth reflecting upon, in a summary form at this point, the events that led to the HST in reality as opposed to the afterthoughts and the after-constructed economic arguments.

It was very clear, when you looked at it and questioned
[ Page 12037 ]
ministers and even the Minister of Finance of the day — not this minister, but a previous Minister of Finance — that little effort had been made to analyze the effects of the HST. In many respects its benefits were exaggerated or misunderstood.

Certainly, the introduction and the implementation of the policy was deeply flawed. I think all observers agree on that now in hindsight. But the motivation was to deal with the issue that arose during the election campaign in 2009 in dealing with the deficit.

The Premier famously said publicly that the deficit would be $495 million maximum. It became very apparent, if he didn't know it at the time…. Many suspect that he might well have reason to know it at the time, but that's probably not an issue worth pursuing now in hindsight. It was very clear immediately after the election that the deficit was going to be much greater.

One senses from listening to the members opposite on many issues that the neural channels were hard-wired back to their experience in opposition in the 1990s and remembered in a way that perhaps was very painful. They were acutely aware that they had made a very huge political issue out of alleged deficits in government finance in the 1990s, although in the year 2003 they presided over the biggest deficit in the history of the province and in 2004 the second-biggest deficit in the history of the province.

[1520]

Deputy Speaker: Member, you're returning to the contents of the bill.

B. Ralston: Yes, I am. Thank you, Madam Speaker.

The issue then became: how did we get to the point where this debate took place and this bill resulted, Bill 54, which is now before us? How did we get to that place?

What the introduction of the HST was in response to was not to improve the tax system, not to bring about the benefits of more competent administration or simpler administration. That could have been attempted in a way that…. Some of the changes that the minister spoke of — certainly, the administrative changes — were open to the government to bring to the PST at any point.

I'll reflect a little bit further in my remarks upon the administrative changes that I support, the new administrative changes that are bought about here, such as the on-line filing that the minister has referred to. There are some submissions by the B.C. Business Council, who have suggested some changes. Some of them look like they're reflected in the legislation; many are not, particularly in relation to audits and appeals.

Certainly, there were genuine issues in relation to the administration of the act, but those could have been dealt with as administrative changes at any point without the necessity of deep-sixing or shelving the PST and moving to the HST.

The real reason why, and the minister of the day essentially admitted it, was because of the concern about the deepening deficit that hadn't been disclosed during the election campaign. The $1.6 billion in transition money was essential to the budget planning in the years going forward.

The secondary consideration was the merit, the policy merit, of the HST system. That became very evident in the debate that followed in the fall of 2009 and into 2010.

So when the minister now attempts to cast, in his speech that he just gave in support of Bill 54, the alternative of an inferior PST and a superior HST, that wasn't the motivation for bringing the legislation forward in the first place, although it was the subsequent reason given for pursuing it in the face of the political firestorm that ensued. Most of that was constructed after the fact.

It's noteworthy, and the reason that I quoted the former Finance Minister, that the motivation was, as the former Finance Minister expressed, as much ideological as factual. In some cases the way in which it was pursued and the attempts to support that legislation were not supported by analytical studies of the legislation and, indeed, the economic detriment, notwithstanding some of the comments from some of the business community.

My sense is that much of the frustration that comes from the business community is less directed at the structure of the tax, although there are those who claim…. Certainly, the input tax credits were welcomed by some sectors of business. But much of the frustration with the PST was in the way in which it was administered, and it's become clear that it is possible to reform the PST in a much more sweeping way.

This political process has necessitated and given the opportunity for that necessary work to be done in a way that I think will go some way towards relieving some of the concern that particularly small business has had with the tax and administering it.

[1525]

Some of the arguments that were made to support, in the course of the campaign and the lengthy debate that ensued, simply weren't borne out by the facts. There was, I recall, a report by the C.D. Howe Institute, which one of the authors of the subsequent report authored — Mr. Mintz from University of Calgary.

What that report did was, using a simulation model of the Ontario economy, model the impact of an HST on the Ontario economy. What it said, what it found was that…. In the simulation model the usual inputs were put in and simulated the effect of that tax on the economy. The number of jobs created by the HST in Ontario in that model steadily diminished for five years and didn't recover to the same level as it was when the tax was initiated for ten full years.

Mr. Mintz later didn't want to follow that report when he was commissioned to do a report for the government of British Columbia, but an objective analysis of that re-
[ Page 12038 ]
port would have given, I think, a prudent Minister of Finance some pause before introducing it.

Certainly, there were very few, if any, studies done by the British Columbia government. Those were subject to freedom of information. Relatively, that was one of them that was cited, and another one by Michael Smart was cited.

So the intellectual arguments in favour of the HST were unresearched and weak, and that wasn't surprising, because the motivation for bringing the legislation forward was to deal with the issue of the deficit, which had arisen in the election campaign of 2009. That was the primary reason for agreeing to enter into an HST agreement with the federal government.

Indeed, Mr. Smart in his study looked at a study of what took place in the Maritimes and noted that that was accompanied by a reduction in retail sales tax in some provinces by three points and in one by four points. He said that the tax was mildly regressive, that the investment effects were temporary and transitory, and he wasn't able to assess the long-term impact of the benefits of the tax because that was outside of his ability and his range of terms of reference in the study. Yet that was a study that was used by the then Minister of Finance in support of his position.

I suppose what is significant here — and the minister, I think, has acknowledged this in part — is that while clearly the PST is not his preferred option, the economic effects on the province of British Columbia will not be as drastic nor as apocalyptic as perhaps some of the statements made during the referendum campaign were. That's probably not surprising, because in the course of a campaign one does tend to, I think, accentuate the difference, mount on rhetorical stallions and head out to do battle. The reality probably is somewhat less than that.

I'm sure the minister, when he has a chance to close debate, may want to respond. Maybe that wasn't what he was saying, but that's certainly what I took him to be saying, in particular.

I would say, just in defence of the return and perhaps to reduce the minister's concern about returning to the PST, there was a report done for Manitoba Finance back in 2009. There was a debate in Manitoba, because they were engaged in the same process to some extent, although they didn't have the same budgetary pressures, about whether to move to the HST. The federal government was offering these substantial cash inducements to encourage provinces to take part and transition to the HST.

[1530]

[D. Horne in the chair.]

Queen's University economist Robin Boadway, the David Chadwick Smith Chair in Economics, said that METRs — that is, marginally effective tax rate — analysis "captures the effect of taxation in one margin alone, and that is the decision to invest in some capital assets. They do not capture the incentive for firms to hire labour, including the substitution of labour for capital; to innovate; to invest in knowledge; to train workers; or to engage in risky enterprises…. METRs also do not differentiate among industries according to their capital intensity and, therefore, according to the magnitude of the distortions that might occur."

Certainly, part of the argument advanced by the minister and part of, perhaps, the frustration that led to his outburst is an acceptance of some of the arguments that the marginal effective rate of taxation is the measure, the only measure — the only effective measure — of taxation. What this very distinguished economist says is that it's important to look elsewhere.

In moving back in Bill 54 to a PST, I think it's appropriate to place some of the previous debate in context. The ultimate decision in Manitoba was not to move to an HST. Another reason they were concerned was that an introduction of an HST would have had a detrimental effect, a shock to consumer confidence, and they weren't prepared to run that risk.

They also looked at Michael Smart's, the same argument that was referred to repeatedly over the last several years, and agreed with the view that I put forward. "These results, though empirical, should be interpreted cautiously because the adoption of HST in Atlantic Canada entailed not only a shift in tax bases but a significant reduction in the average provincial sales tax from 12 percent to 8 percent."

Manitoba also looked at the KPMG annual survey that reports on tax competitiveness and found that virtually all Canadian cities, regardless of the tax regime, are very competitive in North America. Particularly, in Manitoba they looked at the tax competitiveness of their manufacturing industries, and they found that the introduction of an HST, in their analysis, would only improve their tax competitiveness by 1/10 of 1 percent and that the relative ranking would not change. The Manitoba report concludes that Manitoba and B.C. already enjoy very competitive tax rates as it is now without the implementation of the HST.

In response to what the minister has said about advancing the view that the tax regime of the PST is decidedly inferior, there is another climate of opinion that would tend to disagree. I think some very careful, considered arguments would suggest that the disadvantage that he speaks of is not the one that he suggests.

Perhaps, going forward, in order to better position British Columbia…. I think that's what he was doing in the conclusion of his speech, saying that with all of the advantages that British Columbia has — whether it's the advantages of its natural resources, its hard-working entrepreneurs, its skilled and trained labour….
[ Page 12039 ]

Interjection.

B. Ralston: I am the designated speaker, so I propose to continue along slightly further. We shall see how far I go, but I thank the Speaker for that acknowledgment.

[1535]

I think it's important to look forward in a more positive light — not back wistfully and with regret about a debate that has taken place and is now over — and, I think, recognize that, notwithstanding some of the elegant formulations of people like Mr. Mintz, the reality may be somewhat different in that we're in British Columbia and not in such a difficult position in terms of tax competitiveness.

I appreciate, in general, the arguments about tax competitiveness. The KPMG report, for example, compares the cost of doing business in Vancouver and, say, San Diego in California. What is significant in terms of hiring employees is that it's much more expensive to hire employees in the United States. One, because the statutory deductions, the equivalent of Canada Pension Plan and Unemployment Insurance in Canadian law, max out at a much lower salary than they do in the United States.

Secondly, the cost of private health care for ordinary people in the tax range of, say, $60,000 to $125,000 net annual income is dramatically more than here. Certainly, that's one of the clear economic advantages of public health care, notwithstanding the cost pressures on the public system here. Those are pressures.

So the KPMG study, in terms of tax competitiveness for hiring new employees, as a business that would be establishing itself in British Columbia, suggests that British Columbia, in contrast to most American jurisdictions, has a decided advantage.

I think that's the context that the minister was setting in terms of his comments about the tax environment. I think it's important to also look at those tax advantages that accrue to us as Canadian citizens, as British Columbian citizens, with a public health care system.

The other comments I want to make about the bill are perhaps a little bit more focused and less general. I do want to reflect upon a couple of measures that have been introduced in this bill, Bill 54. One aspect that's included in the bill is the intention in the legislation…. And we'll explore this in committee, should we get there. I'm not sure that in the five days or 5½ days that remain we will.

It's the issue of used vehicles. I've received representations, and I'm sure the minister has, from people who, for example, collect antique and vintage cars. That's a part of a market of used-car sales. People are now…. The 12 percent tax, the total of the combination of the GST and the PST on used vehicles, will be what it was under the previous tax regime. Those people are making representations to me that they see that as unfair. When the time comes, if we get to committee, certainly I'd like to explore that further with the minister and glean the explanation for continuing with that.

Certainly, there's another argument that would suggest that a level playing field with the purchase of new cars is an important one. I certainly understand the revenue implications of that tax. In continuing it on used cars, the revenue expectation is, I believe, $135 million a year. I'm not sure exactly of the number. So there is a revenue consequence to that.

I think that's an issue that the public is raising, at least with me, and I'm sure the minister is hearing the same thing. So I would be interested in exploring the rationale for doing it this way and, perhaps, any fine-tuning that might be done of the implementation of that particular aspect of the tax. I believe, if I have the section correctly, it's near the beginning of the bill. I don't have the exact section there. Nonetheless, that is the effect of the legislation.

[1540]

The second area that I want to address is that the minister has spoken of permanent exemptions being incorporated into the regulations that are to come, but temporary exemptions will not be incorporated into those regulations.

One recalls the great fanfare around the so-called green budget, which was one of the budgets steered through the House by the former Minister of Finance, Carole Taylor. There were a number of exemptions, obviously intended as incentives for citizens to purchase Energy Star appliances. Those all seem to have disappeared. That's a decision that the government has obviously made, and perhaps that reflects a revenue component because those exemptions do cost in terms of tax expenditure.

The only thing I would note is that the option under the PST regime is that in the future those options would be open again. What was very clear under the HST was that the list of exemptions was negotiated — a maximum of 5 percent of the tax base. There were a few exemptions agreed to — children's-sized clothes, I believe — but largely, it was consumed by gasoline.

Given that, I think the calculation was, the carbon tax had recently been imposed, the government was reluctant to impose yet another tax on gasoline. The total of those…. And that consumed most of the 5 percent, but the range for exemptions was a limited one.

Now, the argument is made that it's better to have a broad and lower tax rather than honeycomb it with a series of exemptions. Indeed, that's the suggestion that's made by those who oppose the PST. But I would say that, at least as a public policy alternative, if there is an exemption that seems very important — there's broad public support for it; the revenue consequences are manageable — then that option is at least open, whereas under the HST regime it was not. So that, I think, is an advantage to proceeding in this way.

Certainly, one of the exemptions — which dates back to the 1980s, I think, to Finance Minister Hugh Curtis
[ Page 12040 ]
— is the PST exemption on the purchase of bicycles. The minister has said that that, as a permanent exemption, will be reinstated. That is obviously welcome and good news for those who want to purchase bicycles without paying quite as much as they would otherwise.

That's an example of a public policy consideration that can be used. I know the minister is a keen bicyclist. I'm sure that that's not the motivation for this but rather the fact that it existed back from the 1980s forward. So this bill and this provincial sales tax regime do give that opportunity and that flexibility.

The other area that I wanted to look at, and the minister mentioned this, was the attempt to — and I've spoken of this briefly before — provide for better administration of the act. Certainly, the move to on-line submission of the returns is good.

I know in my business life, running my law firm years ago, the process of filing and mailing in those reports along with the required cheque was always something that had to be attended to fairly carefully. If you missed the deadline by one day, there was a penalty of 25 percent of the total tax that you hadn't paid. Certainly, it was an incentive to make sure you didn't miss the deadline. But submitting them electronically, I think — providing that the system is simple and accessible — will be an advantage.

[1545]

The B.C. Business Council also did make some suggestions. The minister and I have run through this list in estimates, but I think, just for the purposes of this debate, I'd like to speak a little bit more about it. The recommendations were…. I want to say that for the most part I support these recommendations. I think they are.… But not all of them are reflected in the legislation that's been tabled.

The B.C. Business…. This was their submission to the Select Standing Committee on Finance and Government Services October 14, 2011, so back last fall. They obviously have a point of view on the PST. But what they did say…. Given that it is coming back, they recommended the following administrative improvements.

"We recommend that the province clarify the rules for scope of application of the PST and eligibility for exemptions, with a view to minimizing future disputes over interpretation." Now, that seems to be the intention of what the minister has said, and that's the claim that he's made. Sometimes that's difficult to assess without looking at the individual sections, but I think if that's the intention, that's the right intention.

He suggests, to continue with the list here, a review: "Revise the statute of limitations for assessments for prior tax years, from four years to three." I'm not sure that that has been done, and there's an obvious reason.

Just as the House had a debate on reducing the ultimate limitation period for litigation — in other words, how long it is that, theoretically, someone could launch a lawsuit against you for doing something wrong — this would limit the number of years that the tax authority could reach back to reassess you. It's not that there would be no ability to reach back. But to limit that by one year — that was their suggestion.

Further continuing with the list: "Adopt risk-based approaches to audits, using sampling techniques, in order to improve returns on investment in terms of incremental revenue potential versus costs." I think the suggestion there is a much more targeted and businesslike approach to audits.

In other words, by using sampling, focused sampling, rather than going…. They would be scientific in terms of auditing purchases or in order to calculate what should have been remitted as opposed to what actually was. To sample, rather than audit every single sales receipt or sales transaction, might be a more effective way.

Also, I think by "risk-based approaches" they mean: to have some assessment of the industry or business that is being audited, given that there are different, I suppose, audit experiences and audit histories in different sectors of the economy. I suppose it's depending on the complexity of the business or the history of that sector in terms of compliance.

It also suggests — I'm continuing with the list: "Encourage negotiation in audits, as is done federally and in other provinces, to lessen the need for litigation." From what I've been told, and their observation is, the process that was in place in the past was a rigid process that encouraged litigation, not negotiation. And that, I think, is a welcome suggestion.

"Enact legislation prescribing maximum time frames for appeals to provide greater certainty as to when business can seek legal remedies." That is something that I think speaks for itself with the good timelines. Again, the direction that's suggested seems to agree with that, but I'm not sure of the specific section.

Certainly, the next section is something that I've confirmed doesn't appear in the legislation, and that's in section 211. If I might just confirm. Yes, that's the part 10, the appeals section. It is entitled "Appeal to minister."

[1550]

What the B.C. Business Council suggests is that the minister "remove the minister from the appeal process and direct appeals instead to a commission or appeals branch, as is done in Manitoba, Saskatchewan, P.E.I. and Ontario" — and there's a parenthesis — "prior to the latter's adoption of the HST in 2010."

Again, they're suggesting that as an administrative enhancement to the administration of the appeals process, if there's an appeal of an assessment. That doesn't appear to have been followed. This section, in my quick study of this over the last day or so, appears to simply repeat the process that was in the old Social Service Tax Act. Perhaps that's something that, upon consideration and if we have time for amendments, the minister might want to look at.
[ Page 12041 ]

Finally, in this section of suggestions from the Business Council, they say to "examine opportunities to avoid duplication with the federal government by determining whether it is feasible to devolve administration of the PST to the Canada Revenue Agency on B.C.'s behalf."

Indeed, that is in fact a position that I have publicly spoken about. In a strange combination, the member for Kamloops–South Thompson and I have both agreed on this and separately made representations, either publicly or to the Minister of Finance. The word that came back was that the Canada Revenue Agency and the federal government were not willing to accept this as a solution.

Canada Revenue Agency, for example, collects and administers British Columbia corporate tax, and they administer a number of other provincial programs. Given that under the HST they were already doing it, it seemed logical to the bipartisan informal committee, I suppose, of myself and the member for Kamloops–South Thompson to make that approach. But for its own reasons, the federal government decided that they don't wish to make that a possibility. That suggestion has been canvassed and rejected because it's not possible to do.

The other suggestion they make is to look at the administration of some of the exemptions which will be coming back, particularly the production machinery and equipment exemption. Early in 2001 the B.C. Liberals, near their first budget or perhaps their second, chose to relieve those purchasing machinery and equipment from paying the provincial sales tax.

I did ask the Minister of Finance about that — not this minister but the member for Vancouver-Quilchena. It was a $110-million-a-year tax expenditure, and I asked what studies had been done to confirm, or not, the efficacy of that relief in taxation. Generally, when you spend that amount of public money, you would want to know what the benefit might be.

Was there a concurrent increase in the purchase of machinery and equipment? Was there any assessment of whether that was a good step or not, besides perhaps being intuitively satisfying and ideologically consistent with the position of the government?

He said that no, there had been no study at all. I suppose close to $1 billion in tax expenditure was made up to 2011 without any analysis of whether it worked or not. It felt good, so it was done.

Given that those exemptions are coming back, I think there is some issue about whether they are effective. I note there is an article as recently as today's Vancouver Sun where the mining industry is acknowledging that they welcome the return of the exemption from PST for equipment involved in mineral exploration and mining.

[1555]

That is coming back. I think that's a good thing, although the impact in terms of investment, jobs — the analysis has not been made, and I don't suppose it will be. Nonetheless, given the commitment that was made by the government on bringing back the permanent exemptions, that's one that will come back. I think it's fair to say that it's easy to understand why industry welcomes that, because the tax on machinery and equipment, for the most part….

There was some interpretation problems at the edges, at the margins of that. For example, in the forest industry, any machinery used on the cutblock, any machinery purchased to run a sawmill operation, whether it was the computer systems or software, the chains, the production line, all the equipment that went into running the sawmill — none of that attracted the PST and hasn't for some time.

In some ways the debate about the impact of the PST on some aspects of business was a bit of a false one, because I don't think that was generally publicly realized. Notwithstanding that, those exemptions will be coming back, as I've said.

The other issue that I wanted to look at beyond administration is just the commitment to getting this process in place as quickly as possible. Certainly, the minister continues to defend the timeline, and no one doubts that this is a huge undertaking.

One might note parenthetically that that's entirely of the province's making. The B.C. Liberals, obviously, were forced into this by the way in which they conducted the HST introduction and by the referendum. Griping about it, I suppose, is not surprising, but it is a situation entirely of their making.

Many people are still of the view that this process could be accelerated. I know the minister continues to make a robust defence to the contrary, but I would say that in matters of public administration, these matters can be expedited. Certainly, I think the failing was probably not to get an early enough start on it.

It was obvious, at least as one possibility back in June or July of the year of the referendum, that the HST might not prevail. Perhaps it would have been prudent to have begun work at that point, giving at least a couple more months to the forming and writing of bringing back the legislation. That was perhaps a wish not to commit what many on the government side thought would be unnecessary work, but I think that was probably a similar failure in calculating the public mood on this issue that was reflected in a lot of other things they did in the process of this debate.

I'm going to be able to draw to a conclusion on this and give way to whoever the next speaker on the opposition side might be. I'm assuming there are no speakers on the government side.

I think it's important just to bear in mind that this bill reflects a substantial victory for democracy in the sense that it brings into effect a bill in the session following the referendum, as is required by the Referendum Act, implementing the bulk of the wish of the voters, which we've all debated here and publicly in so many ways since
[ Page 12042 ]
2009. This is, I think, an occasion for…. It is a tax statute, and not everyone is keen to celebrate taxes, although a famous American judge did say that taxes are the price of civilization.

[1600]

Certainly, if you look at places like Pakistan, where the revenue…. Only 5 percent of the population actually pays any taxes, and their public services reflect the fact that no one pays taxes. It is an occasion for celebration, notwithstanding the fact that it is a tax statute.

If this matter does get to committee…. It is a very lengthy bill. It's 160 pages and 250 sections. I've indicated very briefly some of the areas of concern that I have. But we'll see whether we get there. I fear that this important bill will go on closure — that is, debate will be ended on it — very much like the HST bill, which was not fully debated. But it's going to be done away with in any event.

With those concluding remarks, I would resume my place and give way to another member in the debate.

N. Macdonald: Well, this is one of those rare occasions of bipartisan celebration as we're all going to support this bill and move forward after three years of chaos. It's kind of interesting that we don't seem to have a long list of government members wanting to stand up and speak on this.

I think the member for Kootenay East, who is currently the B.C. Liberal 2013 co-chair, described it as the HST fiasco. I think that's a pretty good description of what we've seen, and the PST bill that's in front of us is just the latest chapter in what has been almost an endless story of chaos and incompetence. But throughout it all there are some interesting stories and some real accomplishments that I want to spend the time available to me talking about, because each of us here has a local story to tell.

What took place in British Columbia around this bill is an important part of this province's history. It has political impact far beyond just this taxation issue, although the taxation issue is not insignificant. Nevertheless, I would say that the implications are broader.

As we look at the PST bill, it's a huge bill. It has been brought in fairly late in the calendar for this session. Nevertheless, I hope that as we move through second reading, we have a good opportunity in committee stage to talk about it as well.

Let's just go back to the genesis of the need for this bill. One part of it, of course, is the referendum. I'm pleased to say that on the day that the HST referendum results were announced, I think many members were sitting and waiting for the results to come out. There was quite a lot of drama as we had members of the media tweeting the numbers being brought in, talking about the delay as everyone waited to get the results. It was actually pretty exciting.

I think most members that were very active on the issue looked very quickly at the results from their area. Having heard the provincial results, I think all of us went and looked at the results from our area. Certainly speaking for the NDP caucus, we as individuals were very active in making sure that we represented the people who elected us.

I know that it was gratifying — when you are standing up in this House, as we did many times speaking on this issue, and you are certain that you are representing your area accurately — to actually have it proven in a referendum that you do speak accurately for the majority of people that you represent.

[1605]

In my area it was 66 percent of those that voted, and it was a high voter turnout across the province. Sixty-six percent voted to remove the HST and go back to the PST. As we look at legislation that, however belatedly, puts us back to the system that people wanted, it is a time to look at what took place and acknowledge some of the people who put tremendous effort into making that happen.

The HST became a part of British Columbia folklore with a surprise announcement in the middle of the summer. When many of us heard it, we didn't immediately know where the announcement was coming from or what the motivation for it was. Certainly, it was not widely discussed in the election, since the two main parties agreed that the HST was not something that was being contemplated. When it was announced in the middle of the summer, I think it took a while for even the politicians who watch this very carefully to really understand the magnitude of what would follow.

What we did know, coming out of the 2009 election, is that the positions that the B.C. Liberals had put forward and were elected on were, post-election, going to be problematic. Some of the things that former Premier Campbell had guaranteed were simply proving to be inaccurate.

There can be a debate as to whether that was purposeful or whether the Premier should have known differently. Nevertheless, it was inevitable after the 2009 election that former Premier Campbell was going to have a problem. While the HST was not talked about very much because both the B.C. Liberals and the B.C. NDP were, pre-2009, against the HST, the projections for the deficit were talked about a lot.

I remember former Premier Campbell talking about a deficit of about $500 million. In fact, it was more precise than that. I think it was actually a guarantee that it would not be over $495 million. So there was a guarantee that it would not be over $495 million. Of course, post-election the news came out that the deficit was about six times that amount.

That's a significant credibility problem for a government that had made such a big deal when they were in opposition about miscalculations in the past. It was a serious credibility problem, and questions were being raised. An awful lot of people thought that the truth around the fiscal state of the province had been hidden. That's per-
[ Page 12043 ]
haps the genesis for what followed next, or perhaps not. We certainly don't know.

Nevertheless, in midsummer, with problems around the 2009 guarantee of a deficit number that was out of whack by almost six times, we got an announcement by the Premier and the then Minister of Finance that the HST was going to be introduced and with it a financial package from the federal government of about $1.6 billion, which may have been seen as a solution to the deficit problem for the Premier.

It was a surprise, I think, clearly to members of the NDP, as you would expect. I also think it was a surprise to many B.C. Liberal members. Just the way the Premier worked, it was pretty…. What we always saw was a very concentrated power sitting with the Premier, and I wouldn't be at all surprised if members weren't consulted. Certainly, the people of British Columbia weren't consulted, and they felt that they had been misled.

There is no question that much of what drives the HST fiasco is around that point. The B.C. Liberals were asked specifically for their position in the 2009 election, in writing, on an introduction of a harmonized sales tax.

[1610]

The B.C. Liberals answered in writing that they would not introduce a harmonized sales tax. To then turn around and do it after such a short period of time, on top of misrepresenting the true state of the province's books, made people, very correctly, angry.

They felt that the government, quite correctly, did not have a mandate to proceed. They felt, as they came to understand the tax and saw what the harmonized sales tax was doing, that there was a tax shift that was going on, and indeed, there was. There was a shift of taxation from corporations, from big business on to the backs of families and individuals, of about $2 billion per year.

It was a substantial shift that the party in power had not received a mandate to introduce. In fact, they had promised that the opposite would happen, and that's a political problem that resulted in many things, including the PST bill that is before us today.

Well, I can tell you that the first call I received on the issue was actually from a heli-ski company. We had talked on other issues. I knew them from a past life. But it was the first time that somebody had phoned to talk about a tax issue. They phoned, saying that the additional taxation that came with the HST was hugely problematic. It was a surprise. Packages had been sold based on expectations around taxation that now fundamentally changed. It threatened the business that the person had. It was a big problem.

From that initial phone call, we started to get more and more calls, particularly from businesses, who started to realize that what was happening with this tax was going to be hugely problematic.

Now, I should say to those that aren't familiar with Columbia River–Revelstoke, it's an area that is heavily impacted by its proximity to Alberta. With Revelstoke, even though it sits a good two hours drive from the Alberta border — maybe 2½ hours, and a pretty tough drive — it is an area that receives huge numbers of snowmobilers from Alberta every weekend in the season, and in the summer a massive number of Albertans come not only to Revelstoke, but they actually then go further on to Sicamous and to the lakes around there.

If you're on the Trans-Canada on a weekend in the summer or in the winter, it is packed with Albertans. Much of the economy that's set up, not only around Revelstoke, but even more so in Golden, Radium Hot Springs, Invermere, Fairmont, down towards Canal Flats and Kimberley…. Much of the tourist business is, of course, aimed at getting people from Alberta to travel through the mountain areas that are there in Alberta and come into British Columbia. So our whole tourist sector is set up for this sort of business.

With the HST, almost immediately we had certain impacts — the number of items that were going to be more costly in British Columbia as compared to Alberta or as compared to Montana. If you went to a ski hill, it would be increases on the ticket price, increases on food, increases on lessons, increases on rentals.

As you went through the list there was a substantial impact for people that had to drive past resorts like Lake Louise, Mount Norquay, Nakiska. There were choices that people had, and they had to drive past those in Alberta and come into an area that now…. With so many aspects of the ski business having to pay 7 percent more, it was a problem. So from Kimberley, from Canal Flats, from Radium, from Golden, from Revelstoke, we started to have businesses indicating that the changes that came with the HST were going to be a problem.

[1615]

We started to hold community meetings. Those first community meetings, I have to say, were relatively small — 25 to 30 people. They mainly came with questions. What we tried to do was provide the information as best as we could from the sources that we had. Because so much of what had been done was a surprise not only to us and to the people of British Columbia, but also to the government members and also to the government bureaucracy, it was difficult to get good, accurate information at the beginning. It took a while for it to get out.

I would say that those initial meetings in the summer were from a small number of businesses that were deeply concerned about how it would affect their business. Like I say, it was heightened by our proximity to Alberta.

I gave the example of a ski hill, but also attached to ski hills is a big part of their business, which is real estate. In communities such as Kimberley and Invermere there are a large number of second homes that Calgarians would come in and purchase.

There were a number of things that went on, but the addition of the HST on those second homes was a real
[ Page 12044 ]
problem. Now, it was difficult to judge how problematic it was because at the same time you had a collapse in real estate in the United States. It tended to exacerbate what we saw.

But I can tell you that real estate second-home purchases pretty well evaporated at the same time that the HST was brought in. That can either be extremely bad timing, or it can be a combination of factors, but certainly HST is something that came up with businesses that were trying to sell real estate — again and again.

The anger grew as we headed through the summer and into the winter, and it was on those themes — around betrayal and around the $2 billion tax shift.

I have to say that there were individuals that started to take on this fight. I mean, clearly the NDP stated a position very early on and organized to make sure that we represented the people that elected us.

I would also say that we would be wrong to speak about this without giving credit to other individuals — Bill Tieleman, Bill Vander Zalm, Chris Delaney. This is an eclectic group.

Bill Vander Zalm is somebody who brought me into politics, and not, in the way that you would think, as a supporter. I was a teacher, and he did some pretty crazy stuff for teachers. I thought that this couldn't be the best that British Columbia could do with a Premier.

I had a history with Bill Vander Zalm, but there was something quite appealing about a gentleman at that stage in his political career simply setting off and taking on this project. To say that he was outgunned is an understatement.

I remember when he first came to Golden. He didn't even have somebody who would write to the newspapers to let anybody know that he was coming. It was just word of mouth that 30 people showed up at a restaurant to hear him speak. He was being driven around by…. I think it was Chris Delaney. Chris never introduced himself. Basically, it was Bill Vander Zalm just showing up. Always an articulate speaker, he seemed to plant some seeds in community after community. It was an interesting process.

Like I say, there's something admirable when you see individuals that you would think must realize that they're up against tremendous odds still going out and pushing to make a change. Like I say, while there were not huge turnouts to see these individuals, or huge numbers of people in our area that might be reading Bill Tieleman's blog on the HST, nevertheless, seeds were planted.

[1620]

What we started to see were business people who had an interest in making sure that they could stop the HST, if possible, combined with NDP supporters who felt that there was something deeply undemocratic about the way this tax was imposed. You also had the individuals who felt, quite correctly, that there was a transfer of taxation burden from corporations onto the backs of individuals.

You started to see letters to the editor appearing in our local newspapers. You started to have individuals gathering and deciding to put in place petitions. You would see them at the 7-Eleven and at different stores, petitions that were to be sent to MLAs to deliver to the Legislature.

I see the Minister of Agriculture rushing around. I have no doubt that he wants to make an introduction, and I think that it's appropriate that he do so. He still has to gather the list, so I'll keep going, and he can signal me when he's ready to do it.

Are you ready to do it now? Then I'll stand aside for a second and allow the introduction, if that's the wish of the House.

Hon. D. McRae: I seek leave to make an introduction.

Leave granted.

Introductions by Members

Hon. D. McRae: Today in the House we have visitors from the Comox Valley, actually from G.P. Vanier high school, the high school that I taught at, I went to school at, and actually, I also attended daycare when I was five years old at. I also forgot to mention that I also had my father teach there for a long period of time — so a great school in the Comox Valley.

They are led by their teacher, a friend and former colleague of mine, Mrs. Heidi Zirkl, who teaches tourism 12 at G.P. Vanier. She has brought them down on this fantastic day.

Because it's a small group and for the sake of posterity, if I may, I'm just going to quickly read off the 11 names of the individual students who are also here and put them into the Hansard forever and ever.

So today, visiting us with Mrs. Heidi Zirkl, we have Sandra MacGregor, Chloe Klassen, Amberley Ferguson, Emily Eagle, Kandice Peterson, Layla Malcolm, Josh McCooey, Merle Therrian, Andreas Cortez, Rachel Honnesson Keil, Cody Cyr, Gabe Frost, MacKenzie Mortenson.

Would the House please make our guests welcome in the chamber.

Debate Continued

N. Macdonald: It's lovely to have people watching. For their information, we are debating the PST bill, which will get rid of the HST. That's what's going on here, and I think your MLA is going to join with the opposition in voting to get rid of the HST, which I think, actually, likely represents the views of the people that elected him — right? So that's all a good thing.

We had individuals taking on the role of writing letters to the editor, of putting together petitions, and then eventually what you saw was it starting to coalesce. Certainly,
[ Page 12045 ]
in our area and each of the communities that I represented, we started to work with groups of individuals that were going to try to work with individuals across the province to see if they could turn back the HST.

Again, it's a daunting undertaking that was being proposed here, and the NDP certainly played a leadership role in the next stage, which was to go through an official petition process. It was a process that had never been successful before, and I know the efforts that took place in Columbia River–Revelstoke.

You had some individuals who were used to campaign after campaign, were tremendously experienced, but as well individuals who had never felt the need to become involved in the political process before. They worked together to do jobs that are pretty difficult to do.

I can remember, in each of the communities that I represented, standing out front of grocery stores or standing in town squares collecting petitioners, making sure that it was being done properly, making sure that they were able to participate.

[1625]

In the end, as we all know, that petition process was successful. At that time, as soon as it was successful, former Premier Campbell, as people know, decided that the referendum that would eventually be held would be one where 50 percent plus 1 would be the deciding vote on the referendum that was to take place, which did take place.

As I said earlier, when the results were actually read out, it was something that we all watched really carefully. To have a success provincially, leading to the PST legislation that we have here, was gratifying. To have it so successful in our area was what I expected, but nevertheless, it was gratifying.

As I say, 66 percent of people in Columbia River–Revelstoke voted to get rid of it. It felt very much like that local effort, that willingness to stand up to not only the powers of government but the powers of major corporations, was something that I think is really historic.

The odds against success when all this started were huge, yet in the end we have been successful. We have been successful in changing tax policy and making it fair for the average British Columbian, which I think is what makes this not only an important taxation piece but also an important political piece.

The lesson that comes from this is an important lesson for any political party and for any group that believes they're going to become government. The lesson that was very clearly taught with this whole HST defeat process was that you need to get a mandate for change. If you intend to do something that's dramatic, you have to have properly informed the people that you expect to elect you as government.

I think that's a wonderful lesson to teach the political class. I think it's a wonderful lesson to teach politicians. I have to say that it was particularly wonderful to be on the right side of that debate. I wouldn't have enjoyed having made the mistake and being in the position that the B.C. Liberals are now — but properly so. Hubris has its price, and I think that's part of what we see today. Odds were definitely not on the side of individuals fighting to go back to the PST, but that success in the end is what we are looking at today — a victory for democracy.

The remaining concerns. The minister in his opening remarks addressed the things that I'm still hearing in the community, of course, about the length of time it takes to get rid of the harmonized sales tax. Even though this PST legislation will be passed, and it has the support of both sides of the House and the independent members…. Nevertheless, it's not until April 1 of next year that we go back to the system that is contemplated in the PST bill, which is essentially the old way of collecting sales tax.

That was the first thing that people would talk about when they still talk about the HST. Why is it taking so long? I'm sure the minister has heard that again and again. As I say, he addressed it in his opening remarks.

The second thing that we heard a lot was about the impact on the sale of second homes, especially once the referendum had taken place and the decision was to go back to the PST, where there is no PST applied to the second-home sales. Obviously, nobody was going to buy a house or a condominium as a recreational property as a second home during that period between the defeat of the HST and the return to the PST.

There was a period of time where there was a lot of pressure on government to come to a solution, and that was introduced some months ago as a temporary measure that would allow the sale of second homes to pick up. It was a good move. So that was the second thing that people were talking about.

[1630]

The third thing that I heard repeatedly from our area, in particular, was concern about the hotel tax related to the resort municipality initiative. When the HST was introduced, there was, I think, almost a lack of realization about what impact that would have on the hotel tax. The HST meant that 7 percent would now be applied to the rental of accommodations. Well, there already was, in many communities, 8 percent as a level of taxation for a hotel tax.

If the HST was applied on top of that, you ended up with a rate of taxation that was seen, quite correctly, as unreasonable. Therefore, the hotel tax was removed. But when they did that, they inadvertently undermined a very good initiative that the B.C. Liberals had put in place earlier on, which is the resort municipality initiative.

It was a new type of taxation for municipalities that allowed them to collect significant funds from a portion of the hotel tax as well as an additional amount that they were able to put in place. So when the return to the PST was contemplated, of course, the question I had was: are we going to go back to the hotel tax as it existed? Are we
[ Page 12046 ]
going to go back to the resort municipality initiative the way that it existed prior to the HST?

During the HST period, when the government recognized that the hotel tax was going to be wiped out, they had to make some dramatic changes. First, they got rid of the funding formula for Tourism B.C. and got rid of the award-winning Tourism B.C. That was a mistake. I think that's widely recognized. The minister at the time made an arbitrary decision, and if one was familiar with the minister at the time, it wouldn't surprise one to see that the mistake was made.

At the same time, the resort municipality initiative was also eliminated. Mayors met with government, and a grant system was put in place, but it was not nearly as effective as the system that had been eliminated with the HST.

If you look at this bill, in division 3, sections 122, 123, 124 and 125 seem to honour the intention of the voters. Anyway, that's a good part. With that, I'll take my seat. Thank you for the opportunity.

Deputy Speaker: I'll remind members in their remarks that we're speaking to Bill 54, and while background relevant to the bill is important, principally the remarks should be concerning the bill — the substance and the structure of the bill itself.

C. Trevena: Like many of my colleagues, I think, on both sides of the House, we're welcoming Bill 54, the Provincial Sales Tax Act. It's the act which will reinstate the provincial sales tax after, I think, the debacle of the harmonized sales tax. I don't think it can be called anything less.

I listened to the Minister of Finance's remarks. I'm hoping very much to hear from other members of the government side talking about this and how it is going to impact them. I know that the Minister of Finance has described this tax as a "better stupid" tax, which I think is really a little insulting to the many, many people in B.C. who came out and voted in a display of, I think, unprecedented grassroots democracy. They came out and voted to get rid of the HST, calling for a reintroduction of a provincial sales tax.

I'm very interested to hear whether other government members also feel that way or if they feel that it is something that is to be supported. I know that in many of the constituencies which government members represent, the harmonized sales tax, the all-too-long-lived harmonized sales tax — we are still dealing with it — was roundly defeated.

[1635]

I might say that it's about time that we had Bill 54 tabled in front of us. As I say, I think it's about 160 pages. It's a good, hefty bill with a lot of detail, as a tax bill is by necessity going to be. It's very detailed. There are a lot of parts for the implementation. I'll get onto this later on in my remarks.

A lot of the parts of the implementation are moved to regulation. I think section 246 on page 155 highlights some of that — in fact, going on, oh, many pages before that on all the regulations that will be brought in, which means some of the parts of the exemptions are not embedded in this piece of legislation. They're going to be brought in separately by cabinet and approved simply by cabinet. I'll talk about that momentarily.

This bill, I think, has been long awaited. It was back in August that the results from the HST referendum came in, and as I mentioned, it had overwhelming support to get rid of that tax. I think that it was, oh, approximately 55 percent of B.C.'ers who said that they had basically had it with the HST. They didn't like the tax. They didn't like the way it was brought in.

It is impossible to talk about this bill without having some reference to the recent history of B.C. because we wouldn't be talking about reintroducing provincial sales tax without having the fact that we had the real disaster of public policy and fiscal policy of the HST.

It was only in 2009. Here we are in 2012. It was literally three years ago, almost to the day, that we were having provincial elections where everyone went to the polls. We had a provincial sales tax at that point. It was an old act. It had been in the government binders for many years. It devolved, and various exemptions had been built in, and various parts of the taxation had been built in over the years.

But we went to the polls with a tax system there — with the GST, which the federal government had reduced over the years to 5 percent, and the PST, the sales tax, which was at 7 percent, and there were many, many exemptions on that.

During the election campaign, obviously, the debate on deficits came up, and we heard the government of the day…. I say government of the day. We had a different Premier — Gordon Campbell was the Premier — and a different Finance Minister saying very categorically that we would have a deficit of less than $500 million.

I believe $495 million was what it was going to be, and "not a penny more" is what we heard. We heard it time and again. It was almost a refrain, sort of "fifty-four-forty or die."

"It's $495 million and not a penny less. We're going to do this. We're going to fight for it, and don't worry about it, people of B.C. You can trust us." That was the thing. The arguments that were heard time and again were: "We are a government that can manage the economy. You can trust us."

In this debate there was discussion from some sectors of the economy who asked the government of the day: "Are you going to introduce harmonized sales tax?" The government said categorically no — and wrote, saying no they would not.

So people went to the polls thinking that after the election it would be as it was before the election. Everything
[ Page 12047 ]
would go on. We'd deal with this comparatively small deficit, small but…. In the greater scheme of things, as we learned later, it seemed comparatively small. The tax structure would be as it was. We could all…. All the people who voted for the B.C. Liberals felt that they could trust the B.C. Liberals with the economy.

I think there was a rude awakening straight after the election — I'd say a few weeks after the election — when suddenly it was discovered that it wasn't the deficit as heard before. It was over $1 billion, and we were going to go to a harmonized sales tax. This was within six weeks that we had that announcement.

[1640]

Immediately people got concerned. They got upset. They had been led to believe that we were going to be going on as before, that everything was going to be fine. We knew that there were problems. I mean, nobody could be aware that the world wasn't going through financial difficulties. Nobody could be aware that B.C. was not going to be isolated, that we were not on our own. But they had a certain amount of faith that they could believe what they'd been told in an election campaign.

Deputy Speaker: I'd remind the member….

C. Trevena: Absolutely, hon. Speaker. I am talking about Bill 54, the Provincial Sales Tax Act, which has been brought in 11 months after a referendum which got rid of the harmonized sales tax, a harmonized sales tax which was brought in without a mandate.

Really, it was fascinating in the way that it brought together a cross-section of people that you would not usually see working together. What drove people was what we now see in the Provincial Sales Tax Act.

What drove people, I would say, were two things. One, there was a sense of injustice and unfairness. They felt that they had been misled. Secondly, there was the real awareness that the provincial sales tax, for all its faults and all its failings, was designed in such a way that there was protection for people through the exemptions — and through the exemptions which we are seeing in this Provincial Sales Tax Act, Bill 54, and are coming in with the list of exemptions that we heard previously.

In the summer of 2009 people suddenly discovered — and it evolved through the months as they heard more and more — the fact that they were going to be faced with a tax that was going to increase the cost of many, many basic items. This provincial sales tax, the new one, will mean that they will no longer have to pay it. But they were faced with this tax. I have to say it's rare that you witness such a terrible policy decision as was made at that time — and such a striking blunder, I have to say. It was so misread.

A sales tax is, by its nature, regressive. By its nature, it is a flat tax. It imposes a flat amount on everybody who is purchasing products. With that, there is a certain level of acceptance. People know that they're going to be paying a tax. They know that if they're going to buy something, they're going to have to pay the tax.

The increase in tax — and now this Bill 54, which does rectify it — astounded people because it really did have a huge impact on both individuals and their small businesses and community economies — economies which rely largely on small business, on tourism and on the service industry. We rely heavily on the service industry across B.C. as well as the resource industry. These were all being impacted.

Now, I mentioned the background to this. The introduction of the harmonized sales tax, which the provincial sales tax replaces, was a terrible policy decision. I might quote from the Business Council of British Columbia at the time. They were, obviously, in favour of the harmonized sales tax. They cite the three key criteria for assessing tax policies — and cite back to Adam Smith and use this as analysis for taxation through the ages — which are efficiency, equity and simplicity.

The Finance Minister has talked many times about how efficient the tax that the provincial sales tax replaces was and for larger corporations and large businesses, how simple it was. But it doesn't really deal with the equity issue. The fact that on a sales tax the argument is: "Well, the more you spend the more you're going to pay, so it's going to impact higher earners because they spend more…." In reality, it does not do that, because the people who have a lower income — a higher proportion of their income goes on paying tax.

[1645]

Everybody needs to get their hair cut. Everybody is going to occasionally buy a cup of coffee out. People need to buy clothes for their kids, and if their kids are too tall or their feet are too big, they will end up having to pay adult prices. People do buy bikes and bike parts and vitamins, and they need to go to…. You know, as one of my colleagues said, it's from birth to death. It's the births, weddings and funerals — all impacted.

The harmonized sales tax and the provincial sales tax both are regressive taxes. Without the cushion of exemptions, the harmonized sales tax did not meet the test of equity.

It's very interesting. There has been a lot of discussion over the last few days. I mean this bill, Bill 54, is a good weighty bill — 160 pages — which, as I mentioned, was brought in just a couple of days ago. In fact, today is Wednesday; it was brought in on Monday, 11 months after…. The referendum results were in last April. This was brought in just this week in mid-May. A lot of work obviously had to go into it. There is a lot of detail to go through.

The commentary, in result of this, has been largely positive. People are pleased. They wonder why it took so long. When we're talking about the historical context and the recent historical context — which you can't ig-
[ Page 12048 ]
nore when talking about something as substantial as the Provincial Sales Tax Act and talking about fiscal policy — it's really redundant to have a debate without being able to put it in context of the economy as is.

There was surprise that it is taking so long. Yes, it's a weighty piece of legislation. It needs to be well thought out and put together. We hope that it is well thought out and put together, and we will hopefully have the chance to have that debate over the very few coming days and through the committee stage, if we get to committee stage, to see how well put together it is. I'm sure many, many people are analyzing it now.

But just in the last 48 hours since this bill was tabled, there has been discussion about that historical context — the length of time it's taken from…. We had the HST brought in, in ten months, that we have…. Still, this bill, the Provincial Sales Tax Act, will not come into effect for another 11 months.

This is why I think that on this side of the House there will be quite a lot of reference to that historical context of the HST, because it's also what we have now. It's what we're living with now, and it's what this is replacing.

I think the fact that we are debating it is good. The fact that it is taking so very long before it will come into force…. The fact that it's taken comparatively so very long from the time we had the election, the previous provincial sales tax…. The election and then the introduction of the tax which we are all working with now, the harmonized sales tax, was so quick. I think that really does astound people.

I'm not going to go too much into the history of the whole anti-HST campaign, the initiative and referendum. Leave it to say that no matter what you think of direct democracy and whether you think it is an appropriate way to approach any policy, let alone fiscal policy, it was extraordinary.

Absolutely extraordinary that this diverse group of people could mobilize so many people across the province in every constituency — because the barriers are very high; the targets are very high — that this group of people could mobilize people right across the province, both for the initiative to get the names on the petition and then to get people out to vote on the tax in what became quite complicated circumstances.

The date was changed. It was going to be a mail-in ballot. It wasn't going to be an in-person ballot. People got very confused, and yet we still got 55 percent of people in B.C. saying they didn't like the HST, they didn't like its regressive approach, they didn't like the way it was brought in, and they thought it was bad public policy brought in a way that was not acceptable and was not done in good faith. Suffice it to say, it was really a unique piece of citizen activity.

[1650]

I think it's very telling. I'm look forward to hear, as we debate this…. Again, I have mentioned this in previous second reading speeches. We are here to debate legislation and to have an honest understanding of our own communities, put our communities' voices into legislation and hear the pros and cons.

For us — for this side of the House, the opposition — it's obviously very positive to have this act here. It is a validation of all that hard work. It's a validation of this disparate group of people who pushed the grass-roots initiative and referendum through. But you can see, right across the province…. I have just literally, if I….

Hon. Speaker, indulge me. We have the votes in favour, and this is why I'm looking forward to hearing from members on the other side.

Parksville-Qualicum, 51.57 percent voted in favour. Peace River North, 50 percent voted in favour. Peace River South, 58 percent voted in favour. Penticton, 50.49 percent voted in favour. Port Coquitlam, 55.61. Port Moody–Coquitlam, 50.85. Powell River–Sunshine Coast, 58.24. Prince George–Mackenzie, 56.9. Prince George–Valemont, 58.7. Richmond Centre, 63.77. Richmond East, 65.58. Richmond-Steveston, 55.19. Saanich North and the Islands, 51.35. Saanich South, 52.52.

That's just, obviously, a few constituencies, a cross-section of constituents both government side and opposition side, that strongly said that they wanted to have the provincial sales tax reintroduced, did not want to see the continuation of the harmonized sales tax.

In my own constituency, the results: 57.97 percent of the votes. So 11,000 — almost 12,000 — people voted to get rid of the HST and to reintroduce the PST. These are 11,000 people who are going to be very, very happy come next April and already asked me why we're waiting till next April for this to come in.

We've already seen businesses close in my community because of the HST. We've seen the service industries — the small hairdressers, the small beauty salons, restaurants — really struggling. This is a community, North Island, which is a resource community. It's starting to shift its economic base, trying to build up its tourism service sector and working in areas that have been very badly affected by the HST, areas where there was an extra 7 percent tax which there wasn't before. So these businesses….

The bike shops are going to be very happy. The tourism operators, the kayak operators who, when they are trying to sell a trip…. For any tourism operator, you sell a trip. Yes, we have beautiful landscape, but you get somebody internationally, and they can see that it is so much cheaper to be in another province or even in another country than it is to be here because we have that extra 7 percent. These are going to be very, very important.

The other area where I know that it is undoubted that we're going to see an increase in business with the introduction of this Provincial Sales Tax Act when it comes into effect — not when it comes into royal assent…. As we all know, that is when the Lieutenant-Governor gives
[ Page 12049 ]
royal assent to it. This isn't going to come into effect until the end of April.

The building sector and the people who deal with home renovations, decoration, all the landscaping. This sector has been hugely impacted. People have been shocked by the increase in costs of doing any renovations with the HST, and this really had a very big impact in the community, where you're not building. You're renovating, because it's tight economic times. And then you can't even afford to do your renovations.

[1655]

The trouble with this is that they say it's not going to be enacted until April, and so we've still have got a whole season. I mean, we're in May. May, spring and summer building season, and into the fall building season. We've got a good season there, where I know there are going to be many people who still won't be able to get down to business and get working.

The government has been praised by the Canadian Restaurant and Foodservices Association. They welcome the legislation. They put out a release just a couple days ago saying that the 12,000 restaurants and 2.6 million guests they serve every day look forward to paying 7 percent less and that they are very pleased to see this, noting that the restaurant industry is an important economic force for the province. They're very happy to come out very positively.

Individual builders that I've been talking to, individual restaurateurs and individual tourism operators are also pleased to finally see this act, but are wanting to know…. They would like to see it come into force sooner rather than later. They don't want to have to wait until a month before the next provincial election for this to come in.

They've had since the last provincial election, where they felt misled and betrayed by the government, because they thought they could trust the government, and they had heard so much about the government's financial abilities. I think the proof was that really — I'm trying to think what the phrase is…. Effectively, people had their eyes opened on the financial abilities of the government and the financial prowess of the government compared to the government's ideology.

I hope their eyes remain open and they realize that while we have the provincial sales tax, this act is only in front of us because many, many people fought very hard and very publicly to use the tools they have through this Legislature and through the referendum process to voice their outrage and their contempt for what they thought was a fraudulent piece of legislation in the harmonized sales tax.

I'd like to go back. I mentioned at the start of my remarks that we have a very large bill. It's 160 pages of fiscal policy. I say from the start that I am definitely not a tax expert. I understand taxation, but going through line by line, I'm very pleased that we have people who can work with us. We have a very good critic here. The member for Surrey-Whalley is a very good critic, and other colleagues have worked very closely on the fiscal side of the agenda looking very closely at this.

What I think all of us, and I'm sure government members too, would really look forward to is to go through what this means — all the different sections. I mean, the pages of definitions go on from page 8 through to page 23. So we have 15 pages of definitions there. It's a lot of definitions; that's just definitions. We have the act itself, as I said, which is 160 pages. It is in 15 parts. That includes amendments to the other act, and then regulations, which I'll come back to.

This is a very substantial piece of legislation that is worthy of very thorough debate and discourse here. As I say, I look forward to that debate and discourse — very thorough debate and discourse about how it impacts individuals and how it's going to impact businesses and how it's going to impact our economy. That's what we're all looking out for.

Without a healthy economy, we aren't going to be able to support the communities in the way that we wish. We're not going to support the families in the way that they need to be supported. We're all looking to have a very healthy economy. This is fundamental.

Today is Wednesday afternoon. We have until a week after next Thursday. We don't sit on Fridays. We have effectively five more days to debate this and have that discussion about the impact and hear from different members of the Legislature about how it's going to impact their communities and how they believe it's going to impact the families in their communities, the businesses in their communities and the economy both locally and provincially.

[1700]

We also have that very important stage, committee stage. Again, I sometimes sound like a broken record. It's not as good a committee stage as it could be. It is not like the federal parliament and not like Westminster, where you actually have a committee stage where you can bring people in. You can bring experts in and have them describe and witness and participate in that explanatory and educative part of the bill.

Instead, we are in the B.C. Legislature — for those who are just turning on and maybe have never watched the B.C. Legislature before. We have committee stage. At the moment we have committees running at the same time as debates are running, which is very unusual for B.C. It hasn't happened for many, many years.

The committee stage here is the critics — our Finance critic, the member for Surrey-Whalley, mostly supported by the member for Stikine, who works closely with him — asking the Minister of Finance questions, going through, from their knowledge and what they've been able to glean from talking to people outside this precinct and outside the bubble that is Victoria. What they do is ask one question. The minister gets support from his staff, and then
[ Page 12050 ]
we go back to the questions. It isn't a healthy way of doing committees. We could be doing committees a lot better.

That being said, with this limited time, we may not even get to committee stage. Since we had such an appalling way of introducing the first piece of legislation, which has to be repealed to introduce this piece of legislation, with the HST, we would hope that the government would want to do this as transparently, openly and effectively as possible to ensure that the public has real confidence in the fiscal base in which they are expected to live and work.

I believe that without both a good and long debate here and an honest and open committee stage, people will start questioning it again. That is a real problem.

As it is, we have all the exemptions exactly the same as they were, and they're not in this legislation. They are going to be decided or approved by the cabinet — the Lieutenant-Governor-in-Council. They're being approved by the cabinet, which means that it is easier for them to be amended and changed.

If they're in legislation, they have to come back to this place to be changed. That is a protection for the people who have lost faith in the system and lost faith in the way that this government has acted on fiscal policy. I can quite see why they would lose faith. They had the opportunity to take part in a debate….

Deputy Speaker: Thank you, Member.

C. Trevena: I thank you, hon. Speaker. I will take my place in this debate and look forward to hearing from members on the government side and my colleagues in the opposition.

D. Donaldson: Hon. Speaker, thank you for the opportunity to take my place in this second reading of Bill 54, the Provincial Sales Tax Act, and address the bill in a general sense. That's what I'll be doing during my time in front of the Legislature here — talking to Bill 54, Provincial Sales Tax Act, in a general sense and the lead-up to this bill as well. Some of the specifics in the bill I will be addressing as well, some of the issues it raises.

[L. Reid in the chair.]

Then I hope that if we do get to committee stage on this bill, which I believe we should given the importance of the bill, there will be some more detailed questions I'll have of the Minister of Finance at that stage.

[1705]

The bill, in essence, is a step along the lines that came about as a result of the HST referendum. It's a step in the line to replace the HST and go back to the PST-GST system. I say it's a step in the process, because it's not the final step yet. We will still have, as this bill outlines, regulations that the Minister of Finance says are going to be coming in the fall of this year, 2012, to actually outline in detail the exemptions and other aspects of what the bill addresses — exemptions around the PST.

Although people have looked forward to the removal of the HST, this bill is not the end of the process yet. We're still going to be waiting on the regulations that flow from this legislation in the fall of 2012. That's unfortunate, because the theme I want to talk a little bit about today is uncertainty.

I was newly elected in 2009, in May, for the constituency of Stikine. For the last three years — that's about three years ago now — the HST has been a dominant topic in the Legislature and in the province. This bill, Bill 54, is in that pattern of the dominant conversation.

If I think back to the times I've risen in question period in this Legislature, the number of questions in the last three years I posed to the government side that related to the HST and the detrimental impacts of the HST dominated my time in question period.

I have been given the role within our official opposition caucus, one of the roles I play, of deputy Finance critic. This taxation topic has dominated my attention, as it has for the people of B.C., for the last three years.

Again, the theme of uncertainty. It was introduced in a way, and now it is taking a long time to rescind. Bill 54, the Provincial Sales Tax Act, is one of the final steps in that process. But it's created such an amazing amount of uncertainty in the province — uncertainty around investment, uncertainty for small business, uncertainty on all sorts of fronts.

It's really been a mess. In fact, it's being studied. From what I can gather reading newspapers in the last week or so, it's already being used as a test case in public policy development in universities because of the mess that it created.

The history of the process leading up to Bill 54 and some of the context that we need to understand around Bill 54 is that we've had a Premier having to step aside because of the enactment of the HST. We have a new Finance Minister since this issue originally arose. So it's of major consequence.

It's dominated our conversation here to the point that what I believe we are seeing with the government and the lack of time we have to debate not just this bill but others is a result of…. There are only so many resources. The resources on the government side and in the ministries that have gone into addressing the HST chaos have eaten up a lot of the time in the bureaucracy. That's a little bit of the context.

Again, Bill 54, the Provincial Sales Tax Act, I believe is the final bill that we'll see in the long history of HST in this province — the last three years of chaos. I say it's the last bill that I believe we'll see on the HST because this act addresses the reinstituting of the PST, the provincial sales tax.

It does not explicitly in this legislation bring back in
[ Page 12051 ]
the items that were exempted previous to the introduction of the HST. We're still going to have to wait for regulation on those, and the government has decided to do the majority of those exemptions through regulation. In other words, we'll have to wait and see. Again, that adds a bit of uncertainty, because we're not going to know for sure until the fall. That's what the Finance Minister says.

[1710]

Again, Bill 54 is the last piece of legislation we'll see from this government, I believe, that relates to rescinding the HST and reinstituting the PST. But we'll have to wait and see on that.

It's important to know a bit of the history leading up to Bill 54 and how we got to where we are today. I'm not going to dwell on that, because I think that's been canvassed a lot in the Legislature in the last three years. But it does have an impact on the debates we're going to have in the next few hours and few days and, hopefully, at committee stage on the Provincial Sales Tax Act.

Just to remind the Legislature and viewers, the current government maintains that the HST was not on their radar. That's a direct quote from the former Premier. The quote was, "The fact of the matter is it wasn't on our radar. We didn't engage in any discussions. I wasn't thinking about it until after the election" — "it" being the HST.

So we see that the long buildup to Bill 54, the Provincial Sales Tax Act, began before the last provincial election when the then Premier was maintaining that the HST was not on the radar. Shortly after the election, we saw that it was instituted despite that denial by the provincial government. There were many justifications for the institution of the HST. As I said, the result of that we're getting to today — Bill 54, the Provincial Sales Tax Act. That's the context of this act that we're debating today. That's how we're getting there.

However, the analysis from outside parties around how the HST was implemented was basically that there was $1.6 billion offered by the federal government to the provincial government to implement it. There was a large deficit facing the provincial government in 2009. Before the election they maintained it was a $495 million deficit, and they stuck to that. Afterwards we found out it was a $2.8 billion deficit, about six to seven times what was projected.

This bill we're addressing today, Bill 54…. Again, that's the context of how we got here. The uncertainty that's been caused over the last three years, I think, has really damaged the province. What we saw was an uprising by the people using the referendum process. There was an initiative. That initiative was challenged in the courts, and then we got to the referendum.

Bill 54, the Provincial Sales Tax Act, actually had its genesis in the fact that a referendum passed on August 26, 2011, in a confusing way. You had to vote yes, if people recall that, to get rid of the HST. Many people thought that was an impediment to people who wanted to get rid of it.

Basically, when you want to get rid of something, you usually say no. But despite that, people were not fooled by the question, and they voted yes on August 26, 2011, when 54.72 percent of the people voted yes. That was reflected in Stikine, almost exactly those numbers as well, in the constituency I represent.

Bill 54, the Provincial Sales Tax Act, is the end of a very long process — three years' worth — and more recently the effort by the people. I believe over 700,000 citizens or residents of the province voted to get rid of the HST. Consequently, the provincial government has had to decide how to deal with that, and Bill 54, the Provincial Sales Tax Act, is the last in a series of moves that the provincial government has had to implement because of failed public policy rejected by the people of the province. That's how we're getting to Bill 54 today.

[1715]

Many people might have remembered the efforts over the years to convince people in the province that the HST was good for them. But they didn't fall for those efforts, especially if people remembered June last year. The Canucks were still in the playoffs, and we saw Stickman ads coming up on the screen trying to convince people that the HST was good for them. They didn't fall for that government advertising, and now here we are with Bill 54, the Provincial Sales Tax Act.

Deputy Speaker: Member, if I can draw you back to the contents of the bill.

D. Donaldson: Certainly, hon. Speaker. I'll be happy to talk to the contents of the bill. Just had to put a little context there, but I'll get to the contents of the bill right now.

I listened carefully to the comments of the Finance Minister in introducing the second reading of this bill, Bill 54. He used the opportunity to discuss and to highlight how proud the government is of reforming some aspects of the PST that Bill 54 addresses.

I would say that this is a government that had from 2001 to 2009 to address elements of the PST that they did not feel were working well. So that pride that the Finance Minister describes is somewhat misplaced, in what he feels Bill 54 is addressing. The government had actually eight years leading up to the failed HST implementation, eight years to address what Bill 54 is now addressing in 2011 — and, I might add, only addressing because of a referendum by the people of the province who rejected the HST.

The introductory comments to Bill 54 by the Minister of Finance…. I take him at his word that he's proud of what he sees as some elements of Bill 54 that address what he believes are deficiencies in the PST. However, it's unfortunate that previous Finance Ministers and his influence at the cabinet table in 2001 to 2009 did not seem to pick up on these deficiencies. That's unfortunate, because if these deficiencies were there, as he claims, then this B.C.
[ Page 12052 ]
Liberal government sat on them for eight years.

I would think that's a fairly unacceptable record. To sit on something that you know is deficient for eight years and then only come to address it in Bill 54 in 2011, after being forced to by the people of the province through an HST referendum, is a sad indictment, I believe, of policy-making.

Some of the aspects of the bill I wanted to highlight. The first is an aspect that perhaps isn't highlighted very often. I highlighted it during the HST debate when the Union of B.C. Indian Chiefs pointed out that they weren't consulted about the implementation of the HST and had questions about how the First Nations goods and services tax — that's the FNGST — or the First Nations sales tax would be affected by the implementation of the HST.

There are many First Nations across B.C. who have put these taxes in place as part of their fiscal abilities under federal legislation. My question to the minister during committee stage will be: how have the Union of B.C. Indian Chiefs been consulted, then, around Bill 54 with the removal of the HST and the potential implications that has on those two taxes I mentioned — the First Nations goods and services tax and the First Nations sales tax?

What we see right now is that we're going to have to wait for regulation to know what exactly is exempt and if we are going back to exactly the system of PST and GST that we saw before, as far as exemptions go. We're going to have to wait for that.

[1720]

I'm sure the Union of B.C. Indian Chiefs, who were very disturbed by the lack of consultation around the implementation of the HST, would be equally wanting to be consulted about Bill 54 and the elements and clauses of Bill 54 that might have impact on their abilities and their jurisdiction under the First Nations goods and services tax and the First Nations sales tax.

It's unclear in the minister's opening remarks on this bill whether the Union of B.C. Indian Chiefs was consulted on the content of Bill 54, the Provincial Sales Tax Act, which we've seen at first reading and we see today, all 160 pages.

I would hope that the Finance Minister and government have learned their lessons around creating more uncertainty with legislation that actually does relate to the HST — it's Bill 54 — and that they've learned from the past and did some consultation with potentially impacted organizations and parties, like the Union of B.C. Indian Chiefs, in drafting this legislation and bringing it to the floor of the Legislature.

That's one item I wanted to highlight that was a deficiency in the original public policy, tax policy, that went into the creation of the HST that is now leading to Bill 54, the Provincial Sales Tax Act, which reimplements the PST and finally puts to rest the HST issue that the provincial government instituted.

Another aspect of the bill I wanted to speak to…. As I said, there are 160 pages of this bill, so there's a lot to consider and a lot to speak to. As I outlined before, this second reading is really to give a general overview of the opinion of official opposition MLAs around the introduction of this legislation. We are legislators here, and our focus is on legislation.

The second part that I've received letters about since the referendum results that defeated the HST and defeated the government's major and most prominent tax policy initiative in the last three years — and, I would argue, in their entire term, since 2001 — is the issue of private sales of vehicles.

Now, I've been the recipient of correspondence from various organizations, one of them being the antique car organization in the province. It's a national organization as well, the National Association of Automobile Clubs of Canada. They wrote with concerns around what happened when the HST was brought in.

What happened was the sale of private vehicles — the tax on that was 12 percent, the HST. Before the HST came in, there was only the 7 percent PST on the sale of private vehicles, from private individuals selling vehicles.

So if I went to somebody else in either Stikine or perhaps Vancouver, which I did a number of years ago, and found through the want ads a vehicle that I thought would meet the grade for where I live — needing four-wheel drive; needing fuel efficiency, because we drive long distances and highway driving — on that sale, previous to the implementation of the HST, only the 7 percent PST applied. There was no GST.

When HST legislation was brought in, however, there was separate sort of — what should I say? — partner legislation that was brought in. It's called a TDP, a tax on designated products. So at the same time the HST was brought in that put on 12 percent harmonized sales tax, a tax on designated products, a 12 percent tax, was brought in on the private sale of used vehicles. Used vehicles is the key here.

[1725]

The expectation when Bill 54 came out was — backed up by the Premier, backed up by the Finance Minister — we'd go back to the same regime of taxation that was in place in 2009 before the HST was implemented. The expectation from people who sell used vehicles privately through want ads or Buy and Sell or whatever was that we'd go back to 7 percent tax.

That did not happen under Bill 54. What happened is that the tax on designated products was not addressed in the exemptions. The Provincial Sales Tax Act did not implement what the Premier and Finance Minister said would happen — go back to that same list of exemptions as before.

This is a bit of a concern. It's hard to determine what that actual issue, the actual problem, is that the provincial government, the B.C. Liberals, are trying to address
[ Page 12053 ]
in keeping the 12 percent tax on the sale of used vehicles privately.

The justification at the time, when the HST was imposed by the then Finance Minister, was that it was a levelling of the playing field, apparently. This was the language that the then Finance Minister used: "the levelling of the playing field," meaning those companies that sell used vehicles as a business.

They sell, oftentimes, new vehicles and used vehicles. We've all seen them as we drive by car dealerships. They've got the new and then — what's the word now? — pre-owned. Anyway, used vehicles. They previously had to pay the 7 percent and the 5 percent GST, so 12 percent all together.

The then justification was: "Well, we have to bring this up to the same level, if private individuals are going to sell." There was this sort of term that was used, "curbers." I believe this was identified as people who…. Not like I did. I went to some fellow's house who didn't want his car anymore who gave me the….

Deputy Speaker: Minister, you're rising on a point of order.

Hon. M. Polak: I understand that there is wide latitude given for debate in second reading. However, the subject matter in Bill 54 does not, I believe, give the member latitude to discuss all manner of tax policy, and this particular tax policy has absolutely nothing to do with the HST.

Interjection.

Hon. M. Polak: No, it doesn't, actually. The member is incorrect. This is totally unrelated to Bill 54. It is another tax measure entirely.

Deputy Speaker: Please continue.

D. Donaldson: Thank you, and I appreciate that, Madam Speaker. I'm sorry that the member from the other side hasn't read the bill. Part 3, section 34, private sale of used vehicles is taxed at 12 percent. Seems pretty straightforward to me — right in the bill. So if the Minister of Aboriginal Relations and Reconciliation wants to flip through the act and find section 34, she'll then understand what her own Finance Minister is trying to implement in this bill.

Again, it just harkens to the increased uncertainty that this government has created around tax regimes with their original implementation of the HST in the three years that we've had to deal with that.

I believe I was talking about curbers. This was a term that at the time the then Finance Minister used to justify the 12 percent tax levy on selling private used cars. I think curbers were identified as people who were making a business of selling used cars, not just private individuals — like I explained, where I went to someone's house who had put a small ad in a newspaper.

[1730]

I was looking for that kind of vehicle and was scanning around the province and happened to be coming down to the Lower Mainland. It was in Surrey, actually, that I managed to find a good deal on the car. The fellow was looking to purchase a different kind of vehicle, and so we came to a good arrangement. He was definitely not a curber.

In the rationale for putting this tax in, it was never really described what the extent of this problem was. It was just thrown out there, as this government is wont to do. "Oh, there's a problem. They're called curbers, and we're going to put a 12 percent tax on used vehicles in private sales." Well, some analysis was done on this, and it turns out that the New Car Dealers Association was the main lobbying force behind wanting this tax. So we can see how, then, the stream of influence goes and they got this tax.

It's interesting. At the same time that this tax — which is addressed in Bill 54, as I pointed out — was brought in back in 2010, some of the justification for the HST at that time was that we were going to be using the HST to fund health care. Do you remember that — to fund health care?

Well, that's what the then Finance Minister said. The people didn't fall for that either. It was going to be revenue-neutral before that. So we're not sure how revenue-neutral and funding health care…. The people just didn't buy it.

Getting back to Bill 54, though, as you've directed me to do. The private sales of vehicles, as pointed out by the letter that I received from the car enthusiasts…. They buy vehicles back and forth from each other that are over 20 years old, 25 years old. So they're not competing at all with the new-car dealers, who have the used cars on their lots, who have lobbied the B.C. Liberals provincially in order to get the tax up to that level.

I also have to say that there are tax options open to new-car dealers who also sell used cars that enable them to offset some of the costs that are represented by that cost differential that they're claiming is a problem between a 7 percent PST — the way it used to be on the purchase of used vehicles, when I went to somebody's house and they sold me the car and we paid this 7 percent PST — versus the 7 percent and the 5 percent that, if I had gone to a used car lot, I would have had to pay.

Some of that difference is that the used car lot is oftentimes a corporation. It's a business. They're able to find tax credits and tax write-offs that are able to compensate for some of that 5 percent.

It's talking apples and oranges when we're talking about somebody who wants to sell their car. They don't need it anymore, or they want to upgrade, or they want to go to a different kind of car. You know, families are get-
[ Page 12054 ]
ting smaller. Lots of people want to move from the van to a smaller, compact kind of vehicle.

That's one area that we'll still see, whether it comes out in regulation or not. That's a big concern to those who are in the vintage car business as well as, I think, to just regular consumers who don't want to see another 5 percent when it doesn't need to be applied in this case. It goes against what the government sees as good tax policy.

Again, we're going to have to wait till the fall, I guess. Right now the minister is saying, "No way," but we'll see if, in the fall….

Deputy Speaker: Thank you, Member.

M. Sather: It's my pleasure to rise and join the debate on Bill 54, the Provincial Sales Tax Act.

It has been a long and tortured trail indeed, leading to this day. Many twists and turns the people of British Columbia have been subjected to on account of the ill-fated endeavour by this government to correct a problem that they ran into upon the event of the 2009 election.

[1735]

I must admit that the context with which I start my comments is somewhat different in respect of how the minister laid out his context, in view of how he sees the events. But as the world unfolded as it should, it came to be that the people of British Columbia did not buy the story that the government was providing to them. That led to this whole exercise that we're still in the midst of.

The bill is before the House now, at this late date. I can't imagine us being able to give it the thorough attention that it certainly deserves. As I think my colleague before me mentioned, it's probably the most significant tax legislation that this government brought in — that is, the HST and the transition from that to what we have now, which is the new PST. I guess we can call it the revised PST.

It's certainly one that bears a great deal of discussion. I know, on our side of the House, we're going to try to do our best to give it the full disclosure, the full discussion, that it requires. It appears that members opposite do not intend to do so, and that's their prerogative. But having said that, I know it's difficult, or I expect it's difficult. It's more what happens on the government side, but I expect it's difficult to listen to the discussion, which is obviously somewhat one-sided. It's coming from us.

But we have to look back at how we got here. Why did we have an HST in the first place? The government said that it was not contemplating an HST prior to the 2009 election. It was not on their radar, said the then Finance Minister. Yet shortly thereafter it came to be. It suddenly came to be.

It's not coincidence — certainly, it cannot be — that at the same time, prior and post the 2009 election, the government realized that they were not going to be able to make the grade that they set themselves up for. I think the Premier of the day said that the deficit was going to be — was it? — $495 million, not a penny more. Something of that nature. Of course, that wasn't going to be possible, so there was a bailout package provided — a handy bailout package, it seemed at the time, I'm sure, for a cash-strapped government — and that was the HST, which….

Deputy Speaker: Member, if I can draw you back to the contents of Bill 54.

M. Sather: Thank you, Madam Speaker.

You know, Bill 54 is bringing in, as I say, this new sales tax act, and it bears a great deal of scrutiny. We're going to give it that, and in the course of doing that….

I know that certainly in my constituency, my constituents spoke very strongly about their feelings around this whole issue, and they continue to speak strongly about it. In fact, there were some comments today in the local media about this very issue, wherein one individual said, for example: "Calling the PST stupid after the voters demanded the HST be dumped is really going to go over well with the public. The Liberals are in self-destruct mode." That has to be the case, and one has to wonder why on earth that all came about.

[1740]

The bill contains some so-called fundamental exemptions. For those listening, there are a lot of words used in discussion of financial affairs. Exemptions are where you're not having to pay tax, such as food, fuel, business inventories and manufacturing inputs.

I thought the manufacturing inputs one was particularly of interest and of note, Madam Speaker, because you will remember, I'm sure, that the input tax credits, as they were called under the HST, were lauded as being a huge deal. In many respects, I think they were for business but not for the consumer. Yet in fact, this bill will exempt manufacturing inputs.

That is the same as the old PST. Manufacturing inputs were exempt. They always were. That is something that this government never wanted to talk about very much. When they were talking about how wonderful the input tax credits of the HST were going to be, they didn't talk about the fact that a lot of that stuff — not all of it, by any means — was covered, certainly for manufacturers, with the input tax credits.

If the government feels that we are being a little bit hard on them, I think they have to bear with it. It comes with the territory, particularly when you look at the history of what has taken place here.

Having said that, of course we, the opposition party — as you will know, Madam Speaker, and as British Columbians will know — advocated for the elimination of the HST and the return to the PST.

We are certainly happy that the PST is being reinstated under Bill 54. However, it's not happening real soon. It's not happening until April 1, 2013. Now, that's the first day of the new fiscal year. I expect that's the reason it's being
[ Page 12055 ]
brought in on that particular day, but you can't help but note that it's April Fools' Day as well. The folly continues to follow this government.

It's not for no reason that this bill will not be in place until that date. The government is making more money under the HST than under the PST-GST. That is simply, in my view, why we are seeing….

The minister had all kinds of comments about how difficult it is to make the transition — complicated, and on and on — but the bald fact of the matter is that the government is making more money under the HST than under the PST-GST — notwithstanding the fact, you will recall, that the government insisted, when it brought in the HST, that it was revenue-neutral. We all remember that phrase, which was talked about a whole lot, but in fact, I think there's a lot more to it.

I think the finances are…. Remember, the government — the minister made this very clear in his opening remarks — is committed to a balanced budget in 2013. So it's kind of ironical, because the government needs more money to balance the budget in 2013. That is exactly the kind of story that they had in 2009 — to manage the deficit. It seems like the more this fated tale goes on, the more it seems to go around in circles.

So the government is committed to returning some exemptions under this act. Under the old PST, it was only a 7 percent PST on the private sale of used vehicles and no GST.

[1745]

The government created a new tax, which is called tax on designated property. There is section after section on this issue in the bill. It was to tax these transactions, when brought in. Now, keeping the 12 percent tax instead of the previous 7 percent tax — that's an additional 5 percent tax for taxpayers and about $40 million in new tax. So it hurts.

It hurts the consumer, and it's an example of how this is not exactly the old PST. In many regards, it is, but in some ways, it's not. In some significant ways, it's not. I'll have a chance to talk about that some more, with regard to some other issues of concern to me.

As I mentioned, the new PST comes into effect on April 1, 2013. One of the things of note in this bill, to me, is that the levy on car batteries for the sustainable environment fund was eliminated with the HST, and it's not being renewed. It's a really good thing to have that levy, because it's an important environmental issue. Car batteries are a real, significant source of pollution and toxic waste, and having that $5 was certainly an incentive to help people to deal with that issue.

I know that in Maple Ridge we have a recycling depot where folks can bring in their batteries, and they did so. I hope that they're not going to be discouraged by this or any similar kind of legislative moves that are contemplated and, in fact, implemented under this legislation, the Provincial Sales Tax Act.

Now, one of the other things that's of concern to me…. Well, maybe I should switch gears and bring forward some of the positive things about the bill. There are definitely some of those. Some of those were outlined in missives put forward by the Canadian Federation of Independent Business.

One of the things they talked about was on-line access to accounts, including making payments. The government, in fact, has said that that's the major improvement to the PST that this legislation brings forward. Obviously, it's significant to be able to go on line — everybody is going on line these days — to be able to access your accounts and to be able to make the payments on line. However, it seems to me that that could have been instituted prior to the implementation of the HST. Notwithstanding that, I think that's a positive thing, as the CFIB has alluded to.

They also talk about harmonizing the GST and PST remittance dates — so a lot less paperwork. I know that that has been one of the complaints in the past about the PST — the amount of paperwork. Certainly, it's going to be helpful, I think, to have that harmonization of those two taxes with regard to remittance dates.

Another thing that they mention is the ability to register using a federal business number. I must admit that I don't understand the full implication of that, but I certainly expect that it is a positive for some businesses, at least, and perhaps for most businesses.

[1750]

Those are some of the good things that the government has said, that businesses have agreed to about the new provincial sales tax being brought in under Bill 54 today. But one of the other things that bothers me about the legislation is around green products, which were previously exempt from the old PST. They are being taxed under the new PST.

There's a lengthy list of these things — for example, residential electricity and home heating fuel. Let me rephrase that. The time-limited exemptions that were in place that will not be returning — I'll correct my last statement there — are, for example, Energy Star refrigerators, clothes washers and freezers. By not reinstating these exemptions, of course, it brings in more revenue to the government, in this case $5 million.

We can't forget — and I've brought it up in this House before — that the previous Premier was pretty adamant about going green. It just seems to me that this is another example of how the current administration is turning away from going green. These are really good exemptions. These are the kinds of things that encourage people to go green, so having to pay more than they would have previously is not a good thing.

Also, Energy Star windows, doors and skylights. In our house we put in new windows that were far more energy-efficient than the old ones. We're not only saving money, but we're saving…. We burn natural gas in our house, as
[ Page 12056 ]
many homes do, and we're not burning as much natural gas because the heat isn't leaking out through those old windows. So those are the kinds of things….

In a world facing dramatic climate change, we need to make lots of changes, big and small, and those are others that are not going to be exempt, unfortunately. Also, Energy Star residential heating equipment, energy-efficient residential gas-fired water heaters, energy-efficient commercial boilers, and this one, devices which reduce idling by commercial vehicles.

I remember the debates that we had. It wasn't so much a debate but just a statement that the government made quite often about how important it was for us to build more roads and bridges because we were in fact greening by that — what they put forward — by not having cars and trucks idling so much. True enough. If you're stuck in traffic, it's not efficient. You're not going anywhere, but your car or your truck is still burning fuel. That's one that I don't think is the kind of thing we want to be cutting back on and getting rid of the exemptions.

Hybrid passenger vehicles — 100 percent PST exemption up to $2,000 provided. It was supposed to be extended into 2011. That's another one that is a green initiative, where we're trying to move towards more energy-efficient vehicles, or we certainly should be. The hybrid vehicle gives us one mechanism by which to do that, and yet it's one of the exemptions that's not going to be returning under the Provincial Sales Tax Act, Bill 54.

[1755]

Similarly, alternative fuel vehicles. Now, I heard government members talk earlier today about supporting biofuels, and that's all well and good. But if we're going to have alternative fuels, we need to have the vehicles to run them, and we want to encourage folks to buy those vehicles. Right now it's kind of a hard sell in some respects. If you take the electric vehicle, of course, it has some speed and mileage limitations. So we want to be sure that we're providing those exemptions, I think. That's my opinion.

Another one — conventional fuel-efficient vehicles. That rebate was based on fuel efficiency criteria set by the federal auto rebate program. The rebate was for 100 percent of PST, up to a maximum of $1,000, $1,500 or $2,000, depending on the vehicle tax. There again, a good green exemption that's not going to be there. It's going. It's gone, or it will be gone on April 1, 2013.

I just don't quite understand it. I know the government is hard-pressed for cash, but I don't understand the movement away from encouraging green technology. In some cases it's relatively small in terms of dollar figures, and others not so small, but it's the direction that I'm concerned about. I see it in other things, other than through Bill 54, which also concern me.

Electric power–assisted two- and three-wheel cycles, electric motorcycles and hydrogen fuel cell passenger buses. The hydrogen fuel cell is one of the prides of British Columbia. We have developed that technology in our province. Why wouldn't we do everything to encourage use of that technology? But instead, we're punishing the use of that technology by withdrawing the tax exemption.

So those are a whole list of green initiatives gone bad in my estimation. I guess we're not going to see any change in that anytime soon, if at all. It certainly gives me some concern about where the government is going with all of that.

The lost exemptions for all of this good, green stuff add up to about $50 million to $60 million in new taxes, so it's a double whammy. Not only are we losing the green advantage, but we're paying for it. We're paying for it big-time; $50 million to $60 million is still quite a bit of money, I think, by most people's estimation.

As other members have pointed out, many of the PST exemptions are coming in under regulation, and a number of those are residential electricity and home heating fuel, prescription drugs. Of course, we're not going to have a chance to debate regulations. The government says it's more efficient to bring in things by regulation because you can amend it more easily. Of course you can. The government can by order-in-council; i.e. the cabinet can amend regulations without going through debate of legislation.

On the other hand, it's the whole need to be transparent. That was the ground zero complaint that constituents across the province had about the HST — that there was a lack of transparency around the implementation of the HST.

Some of these other things that will be brought in by regulation, apparently, are non-prescription drugs and vitamins and certain other health care products and appliances; children's clothing and footwear; clothing patterns, fabrics and notions. I'm not sure exactly what notions are. It's an older word. That's what I remember. It's something good, I guess.

[1800]

School supplies; magazines, books and newspapers; basic telephone and cable service; 1-800 and equivalent telephone services; specified safety equipment; labour to repair major household appliances. That's an important one for the penny-conscious consumer.

When you have to bring in someone, as you don't have the expertise yourself to repair your dryer or your washer or whatever the case may be, the labour is oftentimes — not always — the major cost. So you want to be able to not have to pay that tax on labour, and that's going to come in, apparently, through regulation.

The problem again, though, is that this whole fiasco has resulted in such a lack of trust, particularly around this issue for this government. So people are a little bit concerned about what will happen once this House shuts down and we drift through the summer and the fall.

We don't know on this side of the House whether the
[ Page 12057 ]
government is going to call the House back in again or not. So who knows? Maybe before the next election — well, next spring at the latest — we're certainly going to be back to this House, but that is a long time from now.

Other permanent exemptions to be brought in by regulation are miscellaneous consumer exemptions — bicycles. The Madam Speaker will remember that there was quite a furor around HST being applied to bicycles and it costing folks more to buy a bicycle. There again, that was a non-green initiative. Certainly, the more we can get — I think it's Bike to Work Week this week or next week — more of us out on our bicycles, the better it is if we can get out of our cars more frequently.

Livestock for human consumption; feed, seed and fertilizer; production machinery and equipment; insulation to prevent heat or cold loss from hot water tanks — the list goes on.

Rental of passenger cars for eight hours or less — it's interesting about that one, the rental of passenger vehicles. I was surprised to find, under the HST regime, that when I rented a vehicle, there was HST applied to other tax. I questioned quite carefully when I bought that if that was in fact the case, which surprised me. I didn't think that was how the HST was supposed to work.

Anyway, we're moving on to a bright new future, despite the comments of the minister, which maybe weren't that well considered when he said that the new PST is a "better stupid" but still stupid, obviously. That was ill-considered. I just include one more small comment from a British Columbian, who said: "The minister can call me stupid today, but this time next year at least I will still have a job."

We won't know who is the stupidest amongst us, but that may have been just a misspoken phrase by the minister. In any event, when you're in government, when you're in politics….

Deputy Speaker: Thank you, Member.

[1805]

H. Bains: Again, it is always an honour and a privilege to stand here in this House to speak on issues that our constituents are looking forward to us raising on their behalf.

The issue before us today is Bill 54, which I will be speaking on, the Provincial Sales Tax Act. It is 160 pages, a thick bill, and it covers quite a bit of area on taxation.

I think that one might wonder: what are we doing? What is the need for Bill 54? And what are we trying to cover in this? I think the short version of that answer would be that it is the government's attempt to correct the mistakes that they made right after the 2009 election.

This bill speaks to the HST and the effects of HST and what needs to be done to correct that. Why are we correcting this under Bill 54? It is that, if you recall, when the HST bill was brought into the House, it was to combine the two taxes, provincial sales tax and GST. As we know, at that time the provincial sales tax was at 7 percent, and the federal GST was at 5 percent, so the combined tax that people were asked to pay under that bill was 12 percent. With this bill, we are separating them again — what and how those taxes were collected prior to 2009.

I think that one might wonder: "What is going on? You combined the two; now you're separating the two. Don't you have better things to do in this House that we have sent you to, to deal with the important issues that our constituents are faced with?"

I think this might shed a little light on why we have to do this. As the public who is listening would know, when we went into the 2009 election, we were promised that the government was not contemplating bringing in a harmonized sales tax. It was actually asked specifically by the housing industry and the restaurant industry. They took their word, and we went through the election.

Soon after the election we came here, and what did we get? Exactly what they said they would not do. They brought in the HST. And the outrage and the reaction of the public were understandably unprecedented, at least in my time in politics. How often was a government action reacted to in such a way by the public, where the government had to actually accept the verdict of the public and had to reverse what their action was? So that's why Bill 54 is before us. It is trying to clean up the mess that was created by this government when they brought in the HST.

I think that the public will remember. At least in my constituency, 72 percent of the people voted to reject the HST during the referendum, and that was, I believe, the third highest in the province. So I come and stand here and say Bill 54 is trying to address the voices of that 72 percent, plus those who didn't vote for reasons that they may have.

I think that this also, Bill 54, reminds us how to not do business in politics. We are talking about politicians, and politics is looked down on by many people. It's the actions such as what's before us that we're trying to fix under Bill 54.

It's that you better consult with the public, and you better do what's right for the public. You are not here to represent only one segment of the society; you are here to represent all British Columbians. What we are trying to correct with Bill 54 is the action of the government that actually looked after only one segment of the society, which were the corporations, at the expense of consumers, the working people and small business.

[1810]

Especially the housing industry will be happy that we are debating Bill 54 today. Once it's passed, they would be happy to reinvest in the housing industry again. I was just the other day in my constituency and talking to someone who develops and builds houses. I asked him: how is the business? He said: "You know what? I built a house, and I
[ Page 12058 ]
thought I was going to make a couple bucks on this." He said that the house is sitting there because they're waiting for Bill 54 to pass — and not only Bill 54 to pass. What they are suggesting is that with the implementation date, which is April 1, they can't just wait for that day to come.

[Mr. Speaker in the chair.]

I think many people who were actually hurt by the HST legislation are waiting and listening very keenly to the debate on Bill 54. Although the way it is presented…. I'm sure that the bill will be passed, as it's before us, but many people still would like to see the implementation date earlier than April 1 as is anticipated in Bill 54.

I think those are some of the concerns that people still have with Bill 54, although it addresses the issues that people brought forward during the referendum. We all understand how that came about. Over 700,000 British Columbians voted to get rid of the HST, and as a result, we went through the referendum. We all understand how the government spent millions of dollars after suggesting that it would be dealt with just like a general election. Then they went ahead and spent millions of taxpayers' dollars, and also their friends spent millions of dollars.

I think if you look at people who are waiting with great interest about the passing of this bill…. I think the one part that isn't being changed…. Although the minister promised that this bill will actually take us back to the pre-HST times and all the exemptions that were there will be again included in the exemptions list once Bill 54 is passed, those lists are not here listed. As the bill suggests here, the content of the bill will come under regulations, and those regulations will come later on, sometime during the fall, my understanding is.

They want to wait and see if those lists of items that will be brought in under regulations are exactly the same as they were before. But there's one area that will not change under Bill 54. It is a 12 percent tax on designated property. It will remain. What that means is that under the old PST, there was only 7 percent PST on the private sale of used vehicles, and there was no GST. But under this bill here, what we are talking about is that that will remain at 12 percent. So I think that when you look at the implications of this one particular area that is not being changed, not being brought back to the pre-HST time, it is about a $40 million hit.

Some people will call it a tax grab, and I think when you do some calculations, the 12 percent brings in an estimated $100 million. With just 7 percent, it would bring in about $60 million, so there's a gap of $40 million that these consumers will continue to pay extra under Bill 54, although it was promised by the minister and by the government that we will go back to the old system as far as the exemptions are concerned.

[1815]

The time-limited exemptions, mostly for energy-efficient products, are eliminated now — for example, Energy Star refrigerators, clothes washers, freezers. The value of these was about $50 million to $60 million per year. I think some of the issues remain that are not being addressed under Bill 54. I would certainly suggest that there are so many people who would be happy to see this Bill 54 being passed.

When you look at all of the new services that were brought in under the HST, now they will be no longer taxed at an additional 5 percent. I know the PST was 7 percent, so they will now be taxed at 7 percent.

I think what you're looking at is a $1.9 billion tax shift that occurred during the HST, which largely, when you do all the calculations, was a break for the large corporations, but it was an additional tax for consumers, for working people and for small business.

There were 117 items that now will follow, through regulations, I hope, after this bill is passed. That is the work of this bill. So 117 or so items recognized during the referendum debate that weren't taxed before were taxed under HST.

I think that those folks who are waiting for those items — whether they are restaurant meals or the recreational services like live theatre, movie tickets, amusement parks — will now be happy to see that they will be back on that exemption list under Bill 54 — also professional services, like veterinarian care, accounting, architecture, real estate, wedding planners, caterers, funerals.

I think that there are certain things listed, such as food items, in Bill 54 — but many are not — that will be brought in under regulations. I think that's why it is important…. I understand why people are saying: "Well, why April 1?" We're talking about, under Bill 54, how those items will once again be on the exempted list, effective March 31. I think that's something that they are still not happy about — that it is taking us 19 months from the time that the referendum was passed. This bill is the result of the referendum that was passed by the public of British Columbia.

The other area. I think many people who haven't been investing and want to invest now are waiting until April 1. Buying a house — they are waiting.

There are many builders, as I was saying earlier, that are saying that their houses are sitting there because people are waiting for April 1 to save extra money that otherwise they would be paying under the current legislation. For example, the payments to the contractors, landscapers, repairs to home appliances — those all add up. But thanks to Bill 54, I think that those items once again will be exempted.

Again, I think that the people also have another issue here. With the way that the HST was brought in, the people lost a lot of trust in this government. Now the government is saying: "Well, wait until the fall. We will come up with the exempt list through regulations."

[1820]

Fair enough. I accept that the list will be there and that the list will include every exempted item that was there before the HST was brought in, such as massage therapy, acupuncture, alternative medicine, classes for yoga, dance, cooking, martial arts — all of those.

I can tell you that my five-year-old granddaughter goes for ballet dance classes, so I'm not sure she will be happy. I know her mom and dad will be happy that they will not be paying the HST after next year, when she goes back to the classes. I think that there are many people who are waiting for this bill to pass, and I'm one of those.

I say that it took a long time for the government to bring this bill in. We've been sitting here since February. Now we have — what? — six days left. We have got a bill that is 160 pages long, and it does not even include the regulations. That part is what I think worries a lot of people.

In my own little strip mall where my office is, there are many of these services. Haircut shops and salons are there. Every time I go for a haircut, they ask me: "When are we going to get rid of the HST?" I would be happy to go back this Friday, next week. Whether I need a haircut or not, I'll go and talk to them and say: "Look, come April 1…. Now the bill is before us. We're debating it, and that list will hopefully be included, as far as the haircuts are concerned."

Haircuts and other personal care services, like beauty salons and spas; member fees for clubs and gyms; and player fees for team sports — I think those are all areas under HST that were prohibitive for many parents.

I think it is a good thing that we are debating Bill 54, and it does talk about many of the areas in here, in the legislation. I understand it's for logistic reasons that the exempted list is left out. According to what I have heard from the minister, it's in the event that later if you want to change the list, it's easier to change the regulations rather than coming here and bringing the entire bill in once again for debate. It perhaps makes sense, but again, like I said, the people would like to see what that list is.

I would hope that the minister could simply put a list out. "This was a list that we charged the HST, that people didn't pay PST before. Yes, Bill 54 is here. We cannot, for logistic reasons…. We don't want to put all of the list within the legislation here, but here's the list that we are talking about."

I think that will put a lot of people at ease, especially when you look at the trust level that exists between this government and the public right now. It would go a long ways to make sure that their trust is somehow restored to see the list, at least on this issue.

Mr. Speaker, you use it on a daily basis — well, not perhaps a daily basis but most of the time, at least once or twice a week — the taxi services. We all do.

I'm sure that the taxi drivers have started a conversation on the HST. On many occasions they have with me. They talk about: "Look, it is something that we need to change, and it's not good. It's not helping the business." The car washes, automobile towing and emergency roadside services — I think those are many of the issues that still are with us, and I hope that we will be able to address those.

I do want to say that I think the previous Minister of Finance…. When she was asked what she thought of the HST and whether we should be actually be sitting here now dealing with Bill 54, she said this:

[1825]

"Of course, no one likes new taxes. This particular tax takes the tax off business — it takes $1.8 billion off businesses — and puts it on consumers. That shift is a shift that is ideological as well as factual."

She went on to say:

"Many people will be paying a 7 percent increase on a lot of services and consumer goods, so there's a real strong reaction against that. But I think the bigger issue is that just before the election he promised that they would not, that they would not" — she repeated it — "do the harmonization of sales tax and then right after the election decided to do it."

The Finance Minister spoke with her heart. I thought that there's one person who knew what she was talking about, because she was the Minister of Finance here. She sat with the current Minister of Finance, and I'm sure that they shared many of the discussions.

The other part that I want to talk about is the economic argument that with the HST, I think the housing market suffered greatly. Mr. Peter Simpson, who represents Vancouver Home Builders Association, is on record as saying that it is not helping that industry. Once Bill 54 is passed, I'm sure that they would be happy to see that their industry at least could go back to where it was before the HST.

As a result, I think there will be strong economic activity, especially in the Lower Mainland. When you're looking at the economic downturn that everyone is facing out there, if we could do anything, if Bill 54 will do one thing, it will kick-start or give a little extra push to the housing industry, I'm sure that we all will benefit. It is good for the economy, good for people having more jobs, good-paying jobs. It also will bring back some affordability to housing, because they will not be paying an extra $20,000 or $30,000 on a house for $600,000.

Those are some of the benefits of Bill 54. There are so many items. The minister said that this is to modernize the sales tax system. As I recall, he said that the original tax started in 1948 — and it had additions and deletions, but it sat there as a 1948 tax — and that we needed to modernize it. I agree, until we see something different at the committee stage to see what that actually means. What is the intent behind each of the clauses that we will be debating at the committee stage?

Mr. Speaker: Hon. Member, by agreement, the House is going to stand down and be in recess until seven o'clock. You can continue on finishing your words at seven, when the House comes back after recess.
[ Page 12060 ]

The House stands in recess until seven o'clock.

The House recessed from 6:29 p.m. to 7:04 p.m.

[D. Black in the chair.]

H. Bains: I want to continue with my remarks on Bill 54. Before the break I was talking about many folks who would be happy to see this Bill 54. I made a list of those people who will be benefiting by going back to the old system: the restaurant industry, the housing industry, the people who go for haircuts. The list is a long one. And 117 items will be off the list again, but it is something that they are waiting for.

[1905]

I think one of the things that really is astounding…. After the referendum you would think that as politicians we would accept our mistakes and accept the verdict of the public, because that's what democracy calls for. The public will make the decision. They will make decisions on who is going to represent them in government — and what kind of issues there will be — on their behalf.

Once the referendum was passed, rather than accepting what the public's word was, the minister at that time called the PST tax a stupid tax. Now, on bringing this Bill 54, he was asked: "What do you think now? Is it still a stupid tax?" He said: "It's a better stupid tax."

I think it shows their arrogance and contempt towards the people, the 700,000 of those who wrote on those petitions and signed those petitions. That's arrogance at its height.

No wonder in today's Province…. I'm going to quote a few of those who really reacted to the minister's remarks on that. One of them said: "He can call me stupid today, but this time next year at least I will still have a job." I mean, this is the reaction you're getting from the public because of the arrogance of this government and the sense of governing, the sense of entitlement. I think it goes beyond saying that this is why people are so upset. Bill 54….

Deputy Speaker: Could you direct your remarks to the bill, please.

H. Bains: Bill 54, Madam Speaker. Thank you very much for reminding me.

It is a reaction to the content of the bill. Many people are happy that there are so many things in here where we will be going back to the exemptions that existed before. But again, when you don't accept the people's verdict, as this minister continued to ignore the verdict of the people, no wonder you get the reaction that you get, as I said earlier. It's something that we cannot do as politicians if we are to bring back integrity.

Here's another one. He said: "He called us stupid. Yep, he called us all stupid because we are stupid for rejecting the HST." The list is a long one. You know, I don't blame the public for reacting the way that they are reacting.

What I want to say in conclusion is that all those volunteers who came out and helped in Surrey-Newton, helped us sign those petitions trying to send a strong message to this government, said: "Look, you cannot mislead us during elections and hope to ignore that misleading approach by this government."

As a result, 72 percent of my constituents voted to reject HST — 72 percent. If I recall it correctly, that was the third highest in the province. Surrey–Green Timbers was first, and my own leader beat me by about a point, I believe it I was. I think it's a good thing that that happened, that I'm one behind the leader. This was the third-highest rejection rate. That just shows where my constituents are. They were so angry.

There were so many volunteers. My entire executive and so many people that I didn't even know — I never even met them before, during elections — came out, and they were so upset. They were so angry at the minister and this government, saying: "You can mislead us and win the election, but we will not forget what you have done to us." The message was loud and clear.

As a result, we have Bill 54 before us. I'm hoping people don't have any trust in this government, because what they are saying in this bill is that the list of all those exemptions will come later. I hope that they'll comply there. With those remarks, I'll take my seat now.

[1910]

C. James: I rise to speak on Bill 54, Provincial Sales Tax Act. I want to start my remarks by giving credit to the people of British Columbia, because that's really why this bill is here. It's really why we're in the Legislature talking about Bill 54. It's a bill that truly does belong to the people of British Columbia. They get the credit for the work that it took to have this bill come forward to get rid of the HST and to bring back the tax system that was here in British Columbia.

We wouldn't be here — and I know others have spoken about this — if it wasn't for the incredible effort of citizens. I spent some time with some of those citizens. There were people from all walks of life, from all ages, from all communities and from all political stripes.

I have to say, it's quite extraordinary in a province like British Columbia that we could see something that could unite people of different political stripes. As we all know, British Columbia can be a very partisan kind of place. It can be a very divided political place. But it certainly wasn't divided when it came to speaking out against the government on the HST, which is why we're here in this Legislature spending time on Bill 54 — because of exactly that, because of that incredible effort.

I think we can't underestimate the work that those people were up against. They were, in fact, up against a huge government campaign on the HST. They were up
[ Page 12061 ]
against a government that announced…. And I think it's important for us to spend a little time talking about the context of why we're here for Bill 54, because if it wasn't for this history, if it wasn't for this context, we wouldn't be debating this bill. We wouldn't be having this discussion.

The context was that the government decided that they were going to fight to support the HST. In May of 2011 they announced that they would spend $5 million on a campaign to support the HST — $5 million of taxpayer dollars on a television, print and on-line campaign to do the opposite of Bill 54, to actually support the HST that was in place then.

I'm sure the public — this is taking us back a little bit — will remember the stick figure ads that were out there during the time period of that campaign. The government put together a campaign that involved stick people. I'm sure much of the public have remembered those ads, which certainly didn't have the impact that, I think, the government had believed in spending their $5 million on.

The other thing we saw during that time period, as well, was a ten-page pamphlet that was put together by the government, again, to do the opposite of Bill 54 — to support the HST, which is where the government was at that stage. They were talking about supporting the HST. They put together a ten-page pamphlet that they were going to mail to all households. It was $780,000 to have them designed, to have them printed and then to have them shredded. That's right — $780,000 to shred pamphlets to support something that is now having to be undone by Bill 54. It was extraordinary.

When I think about $5 million on a campaign and $780,000 on pamphlets that were shredded…. And now here we are in 2012, in May, talking about Bill 54, which has to undo all of those tax dollars that were spent by government trying to support a tax that the people of British Columbia didn't ask for, didn't want and very clearly said no to. They said no to this government when it came to HST.

I think about the resources that were spent, the time and energy that were spent during that process. It's extraordinary. It really is an extraordinary time in history in our province — and probably looked at across our country — when despite all the odds, despite what they were up against, the citizens came together and spoke very clearly, delivered their public voice and said no to the HST.

[1915]

I come back to where I started, which is to give credit to the public and to say that Bill 54 really is the public's bill. We talk about the public not having involvement in the political system. We've had other discussions about the public being cynical, not believing that they can have an input when it comes to public process or that they can have a say or that their voice could be heard. I think there are a lot of people who are very disillusioned with the political system.

They can be proud, when they see Bill 54, to know that the public can make a difference, that their voices can be heard and that they can stand up and speak out against something and force this government to withdraw and to have to bring in something like Bill 54.

I think it's important to recognize that we also have this bill here not simply because the public spoke out. The reason that we had to have Bill 54 come forward is because we have a government that doesn't listen to the public. If the government took time to listen, if the government had taken time to be upfront in the beginning, we wouldn't be here with Bill 54. We wouldn't be in this Legislature debating Bill 54. It wouldn't be part of the discussion that we needed to have.

If government had lived up to their commitment, their word, what they actually put in writing — that they wouldn't implement the HST — then we wouldn't be here debating this bill. We wouldn't be spending the time and the energy that was needed to bring something in and then completely undo it again over the last number of years and cause all that uncertainty and all that difficulty, if the government had simply been upfront and had decided to listen to the public.

If we take a look at that time period, I think it's an important lesson. As we debate Bill 54 and as we talk about this piece of legislation, I think it's important for us to take the time to look at how we got here. I would certainly hope that this is a lesson to all politicians of all political stripes about how not to do things.

The HST was actually a point of discussion for years leading up to the 2009 election. During the 2009 election campaign we actually had a discussion about the HST. We actually had a discussion about just the part of this bill that we're undoing.

In fact, all parties during the 2009 election were asked their opinion on the HST. We were asked by an association. Madam Speaker, you'll know, as we all know, that during election campaigns we're all given surveys, and we're asked to fill out our opinions on those surveys. One of those surveys that came forward was regarding the HST. It was asking all parties what their opinion was on the HST. Let's remember that Bill 54 is actually undoing the HST.

The Liberals stated at that time that the HST wasn't on their radar, and we heard the former Premier, Gordon Campbell, say many, many times that the HST wasn't on their radar. The Liberals actually put in writing during the 2009 campaign that they had "no plans to formally engage the federal government in discussions about potential harmonization."

Now, this was during an election campaign when people were interested in finding out about exactly the issues that are in Bill 54. Are we going to stay with the PST and the GST? Are we going to look at the HST? So in good faith, groups and organizations asked that very
[ Page 12062 ]
question of the political parties running in the election. As I said, the very clear statement from the Liberals was that it wasn't on their radar and they weren't going to engage the federal government.

Well, I would think that most of the public, if they had read that and had heard those words…. Certainly, the Restaurant Association, the organization that actually sent that survey, believed that the Liberals weren't going to look at the HST, that it wasn't going to be part of any kind of discussion, because they'd put it in writing. I think most people would believe that. There it was in writing. They said it during the election campaign.

[1920]

The reason we're here debating Bill 54 is because the B.C. Liberals did just the opposite. The election campaign finished. The B.C. Liberals won the election in 2009. They came in, and then in the summertime, a time when most of the public believes that a lot of politics doesn't happen — we're not going to see a lot of legislation or big policy discussions occur — what did we see? We saw the HST announced by the B.C. Liberals in the summer.

I think the public would ask themselves, as they did then: why? Why would the B.C. Liberals decide to bring in the HST, the very reason we're discussing Bill 54? Why would they do that after they put in writing that it wasn't something that they were going to do? Well, I think it's important to remember that during that time period we also saw another big change. That was the number of the deficit that the government had brought forward.

The reason I'm raising these issues is because we wouldn't be here debating Bill 54 if it wasn't for the way the government brought in the HST. Bill 54 wouldn't have been needed if the government had had discussions with the public about taxation — PST, GST, HST — in an upfront, honest way. Yet we didn't see that.

What we saw was confrontation created. We saw communities wondering why the government had decided to change our tax system, the very tax system that Bill 54 relates to. We had the PST. We had the GST. We weren't hearing a lot of debate or a lot of discussion from the public around why that should be changed, yet the government decided they were going to bring in the HST.

That kind of confrontation takes an impact on a province. That kind of difficulty that we saw across our province caused by a government that was not upfront about what they were doing in taxation…. That caused them to have to bring forward Bill 54, pressed on because of the public.

What else did we see in our province besides the kind of anger? What happened when the HST was brought in? Let's remember it was the HST that actually created Bill 54. We wouldn't be having this discussion if it wasn't for the HST. So I think, again, it's important to look at what happened around our economy in our province when the HST came in.

It was a difficult economic time, not only in British Columbia but across the globe. Difficult financial time. When the HST came in, we saw a huge drop in consumer confidence in British Columbia. When you see a drop in consumer confidence, you also see a drop in consumer spending. That was a result of the HST — again, the very reason we are here debating this bill.

The HST didn't simply cause anger in the public and cynicism around the political process. It also caused real difficulty when it came to our economy.

We saw TD Bank economist Diana Petramala, who came out and stated that the introduction of the HST had a pronounced negative effect on the Canadian economy — a direct impact of the HST brought in by this government. She stated: "It's not at all surprising that the Canadian economic growth has started to unwind, given the introduction of the harmonized sales tax" — the reason we have Bill 54 — "in Ontario and British Columbia."

[1925]

So the context, the reason we're here discussing this bill, was because the government introduced the HST without discussion, without consultation, after saying they wouldn't, and in addition to that, they also added more difficulty at a difficult economic time to begin with in British Columbia.

Now, Jack Mintz is an economist that actually the government quoted often when they were taking a look at the HST, when they were bringing in the HST. Well, Jack Mintz, in a paper in 2008, focused in on Ontario, which was a province that was actually looking at introducing the HST.

I think it's interesting to take look at what happened in Ontario. They didn't have to bring in a Bill 54. They didn't have to bring in a bill that we're here debating right now that undoes the HST. Ontario still has the HST. But they had a different kind of discussion with their public. They had a conversation. Were people particularly happy about a new tax? No, they weren't particularly happy about a new tax, but there was much more understanding in the province of Ontario because that discussion had occurred.

The discussion around what kinds of exemptions should be looked at, what kinds of changes were going to occur, had occurred in the province of Ontario. They didn't spend time in their Legislature or time in their province having a referendum around whether the government should have done the HST or not. They didn't have to have a debate around a 200-section bill because they actually had a conversation with their public. As I said, although their public wasn't happy, they actually brought in the HST, and it's still there.

Well, in that paper that talked about Ontario, Jack Mintz stated that the province of Ontario would see a temporary job loss for a number of years after harmonization and they would actually see a smaller employment gain.

Well, here we have a bill, Bill 54. We've spent years in
[ Page 12063 ]
our province — since 2009, so 2010, 2011, and we're now in 2012 — debating, fighting, arguing and now undoing, through Bill 54, what the government brought in, causing difficult economic times when we already had difficult economic times in our province. We didn't need to do that. We could have used that time and that energy and those resources for so many other things in British Columbia.

We also saw a number of individual industries that were hurt. We certainly heard from the restaurant industry, loud and clear, about the impact of the HST. I know we'll see a difference now with the discussion around Bill 54 and with what I'm guessing will be the passage of Bill 54 by both sides of this Legislature, after the public referendum and public pressure. We will see some changes there for the restaurant industry, in Bill 54, with exemptions coming back again. But the restaurant industry was hurt.

These were difficult economic times in our province — again, remember. So you had an industry that in difficult economic times people already start cutting back on and already don't have a lot of extra money to spend, and then you add on the HST. It was a huge blow to the restaurant industry.

You also saw real changes — and again this is going to have a change with the passage of Bill 54 — in the construction industry, in the service industries — new homes, painting, renovations, gardening. All of those areas were impacted by the introduction of the HST, and all saw a huge negative impact on their businesses, with no notice, no discussion, no consultation, with no outcry from the public saying: "Let's move on this issue."

Then another area — and I speak about this issue because it's had a huge impact in my own community, and I heard in my own community the challenges — which was the tourism industry. That's an industry where people can make a choice around where they travel, and they actually look at the tax system. They'd be very interested in Bill 54. It would have an interest for them because they'd be looking to say: "What are the taxes going to be like if I'm going to visit that jurisdiction?"

[1930]

We know that we already have challenges here in British Columbia with our neighbours in Alberta, because having no sales tax makes it very difficult when we're trying to attract visitors. People are saying: "I'll go there where it has no tax."

Then we see the HST coming in, and we see the kind of impact that that has on a jurisdiction like Victoria, Vancouver, British Columbia, where people are making choices of where to go. The HST brought in — again, without discussion, without consultation — caused huge difficulties. I know those industries will be paying attention to Bill 54. They will be watching to see what our tax system will be like in British Columbia. They'll be watching to see what will happen.

The other people, of course — and these are the people who really spoke out, who really were impacted — were the public and families. Difficult economic times, and we saw a $2 billion tax shift with the HST and getting rid of the GST and the PST without discussion. Where does that tax burden come down on? It comes down on families — the people who can least manage, the people who have the most difficulties.

That is the backdrop that we saw that brings us to Bill 54. We had, here in our province, a tax that the public didn't want, the HST — a tax that was a challenge to our economy. We saw the public rise up and fight like you haven't seen in our province in an extraordinary period of time.

They brought together their resources, mainly individuals signing petitions and signing referendums — as I said earlier, a huge credit to the public for their extraordinary effort — and brought in a referendum and said to this government: "No to the HST." That was an extraordinary thing. Even getting to Bill 54, getting to this place in the Legislature today, was a huge, enormous challenge in our province.

Now, I think we all recognize — all of us in this Legislature recognize — that tax legislation is complex. It's not a quick, simple fix. I don't think there is anyone who would believe that. I think we all understand that it takes some time to put this together. But I have to say that in bringing forward Bill 54, the public can't help but feel that this government has dragged their feet.

You know what doesn't help? It doesn't help when you have…. I know other colleagues have mentioned this, but when you have the Minister of Finance's comments, when he presents this bill, that the PST and the GST, that bringing in Bill 54, was just a "better stupid." What kind of disdain can be shown to the public?

I think it is extraordinary that after all of this time period, after all of the issues that I outlined — the lack of consultation, the lack of discussion — that this Finance Minister and that this government, the B.C. Liberals, would continue to treat the public as though they didn't know what they were doing.

Well, the public did know what they were doing. They knew what they were doing when they spoke out against the HST. They knew what they were doing in forcing the government to bring forward Bill 54. I think it is really long past time that the Finance Minister and that all B.C. Liberals recognized that the public had their say and that it's time to get on with it.

Now, I understand that the government might be angry. I understand that they probably didn't want to bring in Bill 54. It certainly wasn't the Finance Minister's choice — nor, in fact, the Premier's choice. Let's remember that they spent 5 million of our tax dollars trying to fight to make it not happen, to not have to bring in Bill 54.

So I'm not surprised that they would be angry, and I'm not surprised that they wouldn't want to admit that
[ Page 12064 ]
they made a mess of the HST. Bill 54, in fact, is just that. It's the government having to admit that they made a mess — that they were wrong and that the public was right. I understand that that is probably difficult for the Liberals to do.

[1935]

They are not exactly known as the government that comes forward to apologize for things. But it has happened. We're here now. We have a bill in front of us, and it's time to get on with it.

Now, there are still some pieces that have to come, as we've heard. We've heard our Finance critic talk about the fact that the regulations still are due to come, with specifics around exemptions. I think there's concern from the public, still, about whether they can trust this government to truly put back in place all of the exemptions that were there before.

We've heard the minister's words — I heard the minister again when he stood up to table the bill and to speak on second reading on the bill — that the exemptions would all be there. That was a commitment that was made by this government when they said they would bring it back, when they were forced to bring Bill 54 in. They would ensure that the regulations were in place.

I have to say that those are pretty hollow words for the public after the way the HST was brought in. It's pretty tough for the public to take a look at Bill 54 and not see every specific exemption listed in there. Those are pieces that aren't in the bill, and I think that's very difficult for the public, because "Trust me" is pretty hollow with the public and the B.C. Liberals. They've heard that over and over again from this government. So I think it's unfortunate that we still see "regulations to come" and that we weren't able to see more specifics in the bill, because I think that would have reassured the public.

Certainly, we in the opposition — and, I'm sure, the public as well — will be watching very closely to make sure that those regulation are very specific, that they list all of those exemptions and that every piece is there.

Now, there are some pieces within here that I agree with. I agree with the efficiencies that the government has introduced in this bill. I agree with looking at on-line filing. I think those are all very positive moves. In fact, I think it's important to say that in the discussion around the HST — and it sometimes got lost when we are having a discussion around the PST, GST and HST — it is important to look at our tax system and it is important to look at fairness for businesses.

Small business owners carry a huge load. Small business owners don't see holidays or days off. Often family businesses are working long days, long evenings. There aren't such things as statutory holidays for business owners, for small business owners. They're working very hard.

We should be looking at how we can make things more efficient for those individuals, those entrepreneurs who've taken a big chance, who've stepped up to the plate. So I think it's a positive that we see in Bill 54 that we actually have some efficiencies around looking at on-line filing and giving businesses a chance to do that.

As we go ahead, I think it's also important for us to continue to look at the tax system. The discussion around the HST was not against looking for efficiencies in the tax system. It was against bringing in a tax change without any discussion with the public, without any discussion with businesses, without any discussions with families, and making a major tax shift like that without any kind of conversation.

As we get into committee stage on Bill 54, I know there'll be more questions about the specifics. I know there'll be questions about the exemptions, about how we're going to ensure that those are there. But I think this really is a bill….

I want to close the way I started, which is to say thank you to the people of British Columbia for making sure their voices were heard, for reminding this government that they are there to govern on behalf of the people of British Columbia — not on behalf of themselves and their friends but on behalf of the people of British Columbia. It was an extraordinary time in our history. I hope it's a lesson to all politicians about making sure that they speak to the public and listen to the public and respect the public, most importantly.

Deputy Speaker: Just to remind members that we are discussing Bill 54 and to keep their comments directed to the bill itself.

[1940]

M. Mungall: I'm very pleased to take my place in the debate here on Bill 54. No doubt, as we tell the story — as many of us have told the story — about how we came to this place, sometimes we venture a little bit outside of the usual parameters in speaking to a bill, because the history of what brought us here today is quite extensive. So as I put my contribution into this evening's debate, I look forward to you, Madam Chair, reminding me to come back to topic just in case I also stray a little bit too far off.

So here we are discussing Bill 54, which is the Provincial Sales Tax Act. This bill, in a nutshell, is one of the steps needed to reinstate the PST by April 1, 2013. So this is the beginning for this government to start enacting what the people of British Columbia have asked them to do, which was to scrap the HST and bring back the PST.

Madam Chair, because that is where we are…. Or Madam Speaker, sorry. Sometimes little House, big House and now we have the little-little House. I apologize in advance if I should happen to drop a Madam Chair again.

So Madam Speaker, what's brought us here today, of course, is this government listening to the people of British Columbia. I think the speaker before me, the
[ Page 12065 ]
member for Victoria–Beacon Hill, said it well when she thanked the people of British Columbia for bringing this forward.

They brought it forward through a referendum that was conducted last summer, and that referendum wasn't put forward benevolently by the Liberal government. Rather, it was fought for and hard won by the people of British Columbia through the Recall and Initiative Act. What happened is…. I'll go back to the beginning.

Just before the election, or during the election in 2009, political parties were asked about their position on a harmonized sales tax, and the Liberals said: "We're not interested in looking at that at this time." So people cast their ballots with that belief — that it was not going to be something that they would implement.

Then on July 23 at 9 a.m. we all woke up to a very different story. In fact, the Liberals decided to implement the HST just a couple of months after the election, after people had cast their ballots with the belief that that wouldn't happen, and then it did.

Who did they consult? No one. As a member of the Finance Committee, I even asked John Winter, the president of the B.C. Chamber of Commerce, if he was consulted, and he said that he found out the same day as everybody else that an HST was coming. You'd think, at the very least, that before putting forward this idea, you would consult with the B.C. Chamber of Commerce. That had not been done, according to what he told us at Finance Committee.

So no one was consulted, least of which the broad public. This was a major tax shift that impacted every single person's pocketbook, whether you're somebody who needs a haircut, rides a bike, goes to a restaurant, buys school supplies. I could probably spend the next 30 minutes alone just listing off all the things the HST was going to increase costs on, but I know that if I do that, I'll be told to speak to the bill.

So speaking to Bill 54, the HST was a major tax shift, increasing costs on a variety of items, and that was inevitably going to cost people more money, and they knew that. They also knew, in learning more about this tax, that while they were paying more, the big corporations would be paying less.

[1945]

It's a tax shift of $1.9 billion. It's a tax shift, so when that tax shift was going to take place and was going to take place on the backs of British Columbians, they started to speak out.

They started to speak out against the harmonized sales tax, and in doing so they went forward with an initiative to call on this government for a referendum. That was no easy task.

It was incredible the number of volunteers who participated in collecting signatures. It was incredible the number of people who signed that petition. They made history when they succeeded in forcing the Liberal government to hold a referendum on this issue.

So the Liberals had to announce that referendum. When they did, they used every trick in the book to attempt to suppress voters — a mail-in ballot, an obscure question that reversed the way people normally respond to the question. People were saying no to the HST, but to say no to the HST, you had to say yes on the referendum question — all this confusing information.

We cannot forget the huge attempt made by the Liberals and by the Premier to buy people into supporting their HST, when they announced that if people voted for it, they would reduce it from 12 percent to 10 percent.

Through all of that I remember talking to my constituents about whether they preferred the PST, which is exactly what Bill 54 is now bringing back, or whether they preferred the harmonized sales tax. Like the vast majority of British Columbians, Nelson-Creston residents were no different. They were no different than people from Boundary-Similkameen or people from Vancouver-Langara or people from Kamloops or people from Victoria and Esquimalt or people from Surrey or people from Terrace or Dawson Creek. They were no different.

They did not like this tax. They were not in favour. They knew what it was, and they knew that the HST and not the PST, to use a word used by the Minister of Finance, was in fact what was stupid.

People started to volunteer to get the word out, to inform people about how to vote. I did the very same thing, and many MLAs did — worked very hard to inform people about how to vote.

It was quite confusing. I was getting multiple people in my office: "How do I vote? I want to express my support for the PST, not the HST. How do I do that? I'm confused by the question. How do I make sure my ballot gets in?"

People didn't receive their ballot. How do they get their ballot? A wide variety of questions. People phoning my office, e-mailing, dropping by, and when that started to go on and on and increase, I decided it was necessary for me to get on the road, set up a shingle and a table, offer some lemonade — because it was summertime, and it was hot, and people would be standing in the sun — and talk to people about how to fill it out properly, how to request their ballot if they didn't get it and so on — when they had to get it in by, and there was an extension, and there was a lot of work that had to be done.

At that time, I'd like to add — because I know if my husband is watching this, he would like me to recognize — I was doing all of this while planning my wedding. He was always worried that all of this work would take away from that, but we had a wonderful day. It was beautiful, and everything went off without a hitch.

So the HST, while it cost my wedding more in terms of catering and planning and a wide variety of items that would not have had HST on them and would have actually…. If we had had the provincial sales tax at that time, it
[ Page 12066 ]
would have made my wedding less expensive.

[1950]

Nonetheless, the day was wonderful, and the HST, in terms of making sure that people were informed about how to vote in the referendum, did not interrupt wedding planning and did not result in less of a day than what we had. It was spectacular.

Definitely, I'm thinking my wedding is probably veering a little bit too far from Bill 54. So back to talking about why we're here and why we're talking about this bill today, and that is the referendum.

When I was out on the road talking to people, it was very clear to me that people were saying they wanted to see the HST gone and wanted to see the PST back. They wanted to see the PST come back with the same exemptions that it had before.

There were also some concerns expressed by some of the small businesses that I talked to. They were saying they'd also like to see the administration of the PST and GST done much easier. That is in Bill 54 for the most part, and I'll come back to that.

I'd like to just wrap up this story. When the counts were released, what we found in Nelson-Creston was that 64 percent of voters voted to scrap the HST and bring back the PST. Next door in Kootenay East, the same thing: 60 percent of voters voted to scrap the HST and bring back the PST.

I know the member for Kootenay East wrote several letters to the editor in my constituency, in my local papers, pushing people to vote for the HST, to vote no in the referendum and to keep the HST. His arguments obviously did not prevail in my constituency nor his own.

In fact, the majority of British Columbians were very clear. At the end of the day, when all votes were counted, the direction that British Columbians gave this House and gave the Liberal government was to bring back the provincial sales tax.

This was not an easy fight. It was not a short one. It was very lengthy. It required a tremendous amount of grass-roots dedication and involvement. Every British Columbian ought to give themselves a pat on the back for making democracy work, because that's exactly what they did. Here we are today speaking to Bill 54, which is the culmination of their voices being heard.

The Provincial Sales Tax Act is only the beginning. As I said earlier, it's one step that's needed to reinstate the PST for April 1, 2013, which is coincidentally a very interesting date right before the next election.

All in all, we'll have gone, within a four-year time frame, from the Liberals saying, "No, we don't want the HST" to "Yes, we're going to have the HST" to "Tough cookies, British Columbians. You're going to get it no matter what" and then British Columbians saying, "No, we're going to have a referendum," and then British Columbians saying: "We had our referendum. We said no. Scrap the HST, and bring us back the PST."

By the time the next election comes about, everything will be as it was, except there are two main differences in this piece of legislation compared to the old system of the provincial sales tax.

One of those differences, as one of my constituents said when I posted on Facebook what we would be doing here in the Legislature…. I often like to do that and keep my constituents updated on a daily basis on what's going on here in the Legislature. The wonderful thing about Facebook and Twitter is that with social media, you can do that.

I posted on Facebook that this is what we're going to be talking about, and somebody wrote back: "Well, look at the fine print. Make sure you look at the fine print and that they're bringing it back in the same way it existed before." I told that constituent: "You bet. You're bang on. That's exactly what you have to look at."

[1955]

That's exactly what I've looked at here. So in the very large bill…. I think it's about 200 pages. I believe this bill was just tabled on Monday.

An Hon. Member: It's 160 pages.

M. Mungall: So 160 pages. Thank you very much.

It's 160 pages, 40 pages shy of 200, but still quite a lot of pages nonetheless. We just received this bill, and here we are debating it already. It's always difficult to go out and just double-check with your constituents to make sure that they still feel the same way. According to what I've gotten on Facebook, they certainly do.

Reading the fine print in those 160 pages, we have two main differences in this legislation. Before I go to these two main differences, I also think it's important to note that most of the exemptions that people had under the previous PST — wow, that was a little bit of a tongue twister in there — are going to come later in regulation. This legislation doesn't deal with all of the exemptions, not even the majority of the exemptions.

In fact, some of the exemptions that it has left out…. For people who are watching at home, I did let constituents know that I'd be up around this time. You never know, Madam Speaker. Someone might have tuned in, maybe two.

For those who are watching at home, who have not been able to download all 160 pages and are wondering what's not in this bill, some of the things they might want to take note of are prescription drugs; children's clothing and footwear; school supplies; magazines, books and newspapers; basic telephone and cable service; residential electricity and home heating fuel; aerodynamic devices for commercial vehicles.

There are a lot of commercial vehicles in my area. For many people, that's how they make their living. People do not make their living off of this, though, in my constituency: equipment to produce energy from ocean currents,
[ Page 12067 ]
tides and waves. I live inland.

But many people are looking to use biodiesel fuel now, and that exemption is not in this piece of legislation. Neither is logging machinery and equipment, also mining, oil and gas, and exports as well. Logging machinery — I have many loggers in my area — is not covered in this legislation.

For me personally, neither are bicycles. I do commute by bike to and from the Legislature. I commute by bike, and in the summer during the mornings — you know, seven o'clock to nine o'clock — you can normally find me riding my bike around the trails in uphill Nelson. Bicycles are not covered in this legislation.

So what is covered here? Well, food, for one, is covered in this legislation. Now, if I had only highlighted that — right? Okay.

All sales or lease of tangible personal property are going to be taxed. Liquor is taxed at 10 percent, so this legislation does deal with that. The luxury car surtax, so to speak, is dealt with in this legislation.

The private sale of used vehicles is taxed, and here's where there is some change to what has gone on in the past under the previous PST system. These types of private vehicle sales — vehicles, automobiles, boats and aircraft — were taxed at 7 percent under the previous PST.

[2000]

Well, under this bill, Bill 54, this tax is going to remain at 12 percent. Had the government gone back to the old system, that would have been $60 million into the B.C. treasury. But under this system, with 12 percent, we have an extra $40 million coming to the B.C. treasury, to B.C. coffers, because this is one of the changes that the government is keeping, so to speak. They are not going back to the old PST system, but they are keeping at 12 percent.

I'm sure there are going to be several constituents who have an opinion on that that they would like to share with me. Perhaps they're already writing about it right now on Facebook or tweeting me on Twitter about it, or maybe doing the old-fashioned thing of sending me an e-mail or maybe leaving a voice mail, or maybe really old-school style and dropping by my office. We're open ten to four, Monday to Thursday.

What I think is interesting is that in contrast to car dealerships, for example, private sellers can't claim the tax credit for the sale. They're not able to claim that tax credit when they sell. They have to give it to the government.

Sure, there are people with opinions on this. Unfortunately, with everything being rushed through this Legislature so quickly, over a six-day period, it's very unfortunate that I'm not able to get hold of as many constituents as I like. I bet you that after I'm done speaking on this, I'll pop open my laptop and see several comments on Facebook about this very item. That is one of the changes.

Now, another one of the changes that is different than the older PST, the one we had before the last election and up until — the announcement was July 23, 2009 — July 1, 2010, was that we had time-limited exemptions. These will not be returning.

So for anybody who is looking to buy an Energy Star refrigerator, clothing washer and dryer or freezer; or who is looking to buy Energy Star windows, doors, skylights; or Energy Star residential heating equipment; or energy-efficient residential gas-fired water heaters — you're going to notice a theme here — energy-efficient commercial boilers; hybrid passenger vehicles and alternative fuel vehicles; electric-power-assisted two- and three-wheel cycles….

By the way, I'm thinking of getting myself an electric-powered bicycle just so I can get uphill better. Anybody who has been to Nelson…. You might have gone there a couple of times and noted that I live way uphill. So an electric bicycle would be very handy, but the exemptions for the PST that existed previously, and that was due to a time limitation, are not going to be coming back. Hydrogen fuel cell passenger buses….

You'll notice that everything I just listed off there for these time-limited exemptions that will not be returning are all things that are good for the environment. There is a theme in that.

In this day and age climate change is real. The jury is not out on this issue. It's real. It is happening. It is impacting every corner of our globe, and we as a society need to do as much as we possibly can, in a way that is still fair and just, to reduce our impact on global warming.

One of the ways has been to encourage people to purchase…. When they are going to buy a new refrigerator; when they are going to buy new windows; when they are going to install a new door; when they are going to get a new commercial boiler, for example; or if they're going to buy a new car — all of these things.... By making them less expensive, by reducing the PST on them, we were encouraging people to do the right thing and make these types of purchases. They are not inexpensive. Often the Energy Star appliances are a bit more expensive than the conventional appliances as it is, without the PST on it.

[2005]

So if we can take off the PST, then we're encouraging people to go that route. This bill is not doing that. It is not reinstating these time-limited exemptions.

Interjection.

M. Mungall: I'm sure the Minister of Environment has an opinion on that, and I look forward to him standing up in this debate and sharing his opinion on that and taking his turn to speak when he has the floor.

These are two of the things that are different from the past.

I think another important thing to note about this bill
[ Page 12068 ]
is in terms of its timing. When it was first announced, the referendum results, the public was told it was going to take 18 months to bring back the PST. I want to just put that in context, because it took 11 months to bring in the HST.

What I think is even more interesting is that it's taking 12 months to get rid of the penny. That's the federal government's move. They're wanting to get rid of the penny, and fair enough. There's a cost reason for that.

I know that Salmo is suddenly going to become a major tourist destination for its giant penny, because it'll be the last penny in Canada. I encourage all people to come out to Salmo and get your picture taken with the penny. I know that whenever one of my colleagues visits the constituency, we make a trip out there just to do that.

[L. Reid in the chair.]

It's 12 months to scrap the penny, and it takes 18 months to bring back the PST. Here we are talking about this, and we still have so much further to go on this issue. I think the people of British Columbia are a little bit dumbfounded by the fact that it takes 12 months to get rid of the penny, 11 months to bring in the HST, but 18 months to go back to the PST. It's a very interesting point.

Deputy Speaker: Member, can I bring you back to consideration of the contents of Bill 54?

M. Mungall: Thank you very much, Madam Speaker. I knew that was bound to happen at some point. It has happened so many times because, like I said at the beginning, it's such a big story — how we came to Bill 54. So it's easy to sometimes stray.

I think I want to just finish it off with this. The Minister of Finance refers to this bill as just nothing more than "better stupid." I think that is a very large disservice to the people of British Columbia. They're not stupid at all. They just didn't buy in to the rhetoric that the Liberals offered when they tried to sell them the HST. Instead, they put their feet to the ground, they made democracy happen, and at the end of the day they won.

This is a real testament to what it is to get out and participate and be involved and make a difference in your community. This is democracy in the works, and every single British Columbian should be absolutely proud of themselves for their contribution to where we are today, which is speaking to a bill that is the step to bringing back the provincial sales tax.

With that, I look forward to hearing the contributions from, hopefully, all members of the House on this very important issue. I've already issued my challenge to the Minister of Environment to offer his views and his thoughts on this. I hope that challenge goes out to all Liberal members of the House. I know that the opposition NDP is definitely getting up and taking every opportunity they can, and I enjoy listening to all of the comments.

M. Karagianis: I'm happy to take my place in the debate here on Bill 54, which perhaps in the years to come will forever and always be known as B.C.'s stupid tax, maybe the stupid provincial sales tax, the provincial stupid tax — I'm not sure. But certainly, the Minister of Finance has made it very clear at the beginning of this process, when we went from the PST to the HST to the present day. His feelings have been made very, very clear on this.

[2010]

Bill 54 has its genesis, really, in the 2009 election and the pre-election period when the B.C. government guaranteed British Columbians, promised British Columbians, that there was going to be a very fixed deficit, that it would go no higher. We went through the election of 2009 with that assurance and found out, merely days after the government had once more won its seat, that it was anything but what we had been told.

The reality is that with Bill 54, this is the culmination of a process that I think has had all kinds of twists and turns, not least of which the things that we were told were going to be accomplished by the original shift from the PST in 2009 to the HST. At the time, the government promised us that despite what was happening in the economy North America–wide — and then, consequentially, globally — somehow British Columbia was going to be protected from the consequences of a financial meltdown that was happening south of the border.

We saw, going into that last election, no discussion, really, about any kind of tax shift away from the PST. In fact, I believe a document that was circulated by the restaurant industry and other interested parties had a signatory saying there would be no shift to the harmonized sales tax. I know that at one point the Finance Minister for this….

Deputy Speaker: I know the member is coming back to the contents of Bill 54.

M. Karagianis: Absolutely, to Bill 54, Madam Speaker.

I do know that the Finance Minister, Carole Taylor, when she was here, was very clear on her feelings about the HST and really put that up against the PST, which had been in place for years here in this province and, I would argue, had not shown any inclination to destroy the economy, to collapse business profitability or in any way to contribute to the economic meltdown that cascaded us into the HST post–Election 2009.

It's interesting that in coming back to Bill 54, which the Finance Minister has said is a better version of a stupid tax…. In fact, if we look back to the promises that were made about the HST, it would seem to me that we were told that the PST was some demonized form of taxation
[ Page 12069 ]
that really was on the brink of destroying the economy of this province.

The experiences elsewhere in this country were, of course, different than what we were having here in British Columbia after the 2009 election.

It's interesting that if you set the context of the economy of the time, British Columbia, just prior to the 2000 election and in the year previous, had placed ninth out of ten provinces for economic growth. B.C.'s GDP per capita had actually fallen the year before that election. So we found ourselves in a precarious place even before we saw the economic meltdown that came consequentially out of the American mortgage crisis.

We were then told, just after the 2009 election, that really it was necessary for us to abandon the PST, which we're now returning to with Bill 54, and that we had to go to the HST because, in fact, our economy was dependent on it. We were at a critical moment in our financial and economic position here in British Columbia.

In reality, Manitoba had already done an extensive study on whether or not they should proceed to the HST. After thoughtful study and a thorough economic environment scan, their ultimate decision was not to proceed to the HST, because they felt that one of the key factors was that it was going to erode consumer confidence.

Now, under the PST, that hadn't been one of the significant threats here pre-2009 or even just post–2009 election. I don't remember any discussion taking place anywhere in this province about the fact that our consumer confidence was being eroded by the tax system.

In fact, it was one of the salient points that the government made on switching us to the HST — that combined, of course, with the $1.6 billion payoff that came from the federal government to help us make that transition.

[2015]

Coincidentally, it just happened to help pay off some of the massive, ballooning deficit that we found ourselves in because, of course, our $495 million deficit that we'd been promised in the 2009 election had suddenly and mysteriously blossomed into considerably and significantly more than that. So we were told that the HST needed to replace the PST, which we're now returning to with Bill 54, because our economic future was really dependent on that.

It didn't matter what other jurisdictions were experiencing or what their studies were telling them. We, in fact, adhered to this theory that somehow the HST was necessary for economic health.

It is really interesting because, of course, as the public opinion began to boil up and have a backlash against the government, at the loss of the PST that we're now returning to with Bill 54, and the implementation of the HST, the government looked for some way to validate their position.

They certainly couldn't find it in the Manitoba study, so they hired Mr. Jack Mintz to go out and put together a study for them. It is very interesting that in that same time frame, there is all kinds of evidence to show that much of what we were promised in the way of productivity growth, of economic security, of increase in investment in this province, were maybe being oversold.

Certainly, the C.D. Howe Institute report that came out talked about the fact that…. I'll quote here. "It is important to emphasize that the increase in investment caused by the HST reform is a short-run phenomenon, as firms have acted to adjust to the…higher-capital stock that is desired when taxes are lower." It goes on to say that the dramatic increase in investment over ten years perhaps was not supportable.

So we find ourselves in the environment of the HST. The facts — the economic and scientific-based facts — and the information that came to us from economists aside, public opinion, at the end, was the driving force that chased the government down the rabbit hole with HST and inevitably led us to this day, today, when we get to stand up and debate on Bill 54. Not before it is time, because I think most British Columbians are saying that it is about time that we got back to the PST.

We held, which I think everyone in this House…. I know it has been canvassed extensively and very well and thoroughly and compellingly by my colleagues. The historic referendum and public uprising against taxation in this province — really quite a phenomenon. I mean, we can think back to the times when voters have risen up, have banded together and have fought back against taxation with the government, and it is fairly rare.

Oddly enough, in all the years of the PST — and frankly, it was causing a certain amount of cost pressure on all kinds of businesses; over the history of the PST, it was frequently amended to try and ensure that the business climate was able to thrive under that provincial sales tax system — we didn't see the kind of uprising we did with the HST. I don't think it is understating it at all to say that that was a pivotal moment not just in tax reform and in voter democracy but in the political landscape of this province.

We know that since that time, in the years that we have seen go by since 2009, when the tax was instituted, to today, when we are now in the position of reinstating this provincial sales tax, it has caused enormous political wreckage within this province, from one end of the province to the other.

Often you see kind of political issues burble up in one or other area of the province. You might see serious political issues centred around, say, a pipeline in the north or infrastructure projects in the Lower Mainland.

There are places where political hotbeds occur, but this HST uprising by the people of British Columbia was from one border to another border to another border. From rural British Columbia to the Island to the Lower Mainland, it didn't matter where you went. People every-
[ Page 12070 ]
where spoke with a very strong voice. It was a phenomenon to be a participant in that.

[2020]

When I look at my constituents and talk about the fact we're finally getting back — unfortunately, in the last days of this sitting — to the provincial sales tax, under Bill 54…. It is with a certain sense of irony that we stand up here now to debate on this, to have our say, to support the return to the provincial sales tax. I'll talk a little bit more about some of the warts that it still wears and some of the problems that we may still encounter with this.

In reality, it's about time that we got back to delivering for British Columbians what they asked for some time ago in the HST referendum. Frankly, the public has wondered why it's taken so long to return to this point in time, when it seemed fairly simple. The HST outcome seemed quite simple and straightforward. The public wanted to return to the provincial sales tax in its previous form and would not be satisfied until that happened.

Sadly, although we are debating this here today, it still will not remove the HST — and if I may coin a phrase; the Finance Minister may call this the provincial stupid tax, but I would call the HST the very hated sales tax — from people's paycheques until next year, until April 2013.

We still have another year of paying HST on every single thing we purchase, from your telephone bill to your Hydro bill to items that you purchase anywhere in your life — children's clothing, all the things that families have felt so deeply attached to and had to pay this extra tax on — that have cost families the consumer confidence that we were warned about in studies some years ago. That's still going to be there.

So it's a reminder to the government over and over again. When people pay that HST on their telephone bill, on other bills, they are going to say: "Why did we not return to the provincial sales tax under Bill 54 immediately? Why, when this bill passes, are we not able to then go immediately back to provincial sales tax?" That's what people want.

Deputy Speaker: Member, I'm drawing you back to the contents of Bill 54.

M. Karagianis: Thank you very much, Madam Speaker.

I would like to just talk a little bit about some of the components here. This bill will reinstate the PST on March 31, 2013, as I have said. Until that time people will still be subject to the HST, and frankly, it'll continue to be a thorn in people's side every single day until that happens.

I'm not sure, politically, why the government would still continue to put themselves at risk that way, but that is their decision. So on March 31, 2013, the PST will be reinstated.

I will certainly say that much of what I heard from the Finance Minister in delivering this bill I do think is good. I think it's good to sort out some of the more archaic and convoluted pieces of amendments and regulations that had developed over the years of the PST. I think that's a very good move — that we are making a more streamlined version of this.

Now, the province said they will be drafting regulations, and pieces of this legislation are still to come. That, unfortunately, gives me a great deal of concern, because if we have learned anything in the last few years, it is that the devil is in the details.

I am certainly concerned, and I know British Columbians and my constituents are concerned, and I've heard about it in just the few opportunities I've had to consult with the public since this was tabled and now being debated. Not a lot of time to consult with the public, but luckily I live close to the Legislature, and I can talk to people every day about this.

I do know that there is a grave amount of concern about whether or not there's going to be some trickery in any of this. I sincerely hope not. I hope — and I will take the government at face value on this — that they are going to adhere to the promise the Premier made that this will be reinstated in exactly the same number of amendments and PST exemptions that previously existed before the HST debacle was undertaken.

[2025]

We will, I guess, see. As time goes on, we will see what kind of regulations are going to come out of this and what future legislation we'll see with consequential amendments to other statutes. Until we see those, I don't think we can pass absolute judgment on Bill 54, but I am certainly willing, at this point, to progress and support this.

Now, I do know immediately that there has been one shift. The tax on designated property will remain at 12 percent, which it's been under the HST, rather than returning to the 7 percent that it was previously. I'm sure we'll hear about that from constituents. People will know that. People will follow this piece of legislation probably more closely than anything else that goes through this House in this particular sitting of the Legislature.

We know there's a lot of legislation that has gone through, but I think this will be scrutinized — unfortunately, after the fact. There has not been a lot of consultation time here with the public.

Presumably, over the last year or whatever that the government has been working on this, there has been some consultation with the business community. So we would expect to anticipate that their needs have been considered. But we'll find out what some of the impacts are out there in communities where we live after this legislation has passed and as we see these regulations implemented.

Much of them, of course, will be outside of public scrutiny, but I suspect people will be watching pretty closely anyway. I know that the HST people, who were so successful in the referendum, will all be watching, because
[ Page 12071 ]
they do not want to be tricked one more time in what they have to pay in taxation.

It says here that the new legislation modernizes the old social services tax and the hotel room tax. I'm happy to see that as well. I would give thumbs-up to the government for doing that — for modernizing and streamlining some of these portions of the tax act.

I do think that the PST, over the years, has been amended and fine-tuned, as any legislation is, where it grows with the times and the needs of the community around it. Legislation that's written ten, 15, 20 or 30 years ago does always need to be amended and revised. So I'm glad to see that there has been an application there for that.

I know, in listening to the presentation from the Finance Minister, both the promotional sort of information that came out prior to this Bill 54 being tabled and subsequent remarks made by the government, that there has been much made about the fact the low-income HST credit will be gone.

Certainly, that reduces some of the payments that have gone to people to help offset the cost of the HST. The government has, I think, really sort of tried to promote that as being a real downside of the return to the PST.

Frankly, it would seem to me that most people were paying more every single day in their daily lives for the HST. I would love to see a study that says whether or not the money the government was returning to them in any way actually covered off what they were paying in HST. I know there was lots of theory about how the cheques that were being sent to British Columbians as a rebate more than offset what they were spending.

I'm not sure I believe that. Certainly, when I talk to people in my community, they're not convinced of that either. If you have a growing family, if you have people that work in your household, people that are out actively participating in the community every day, they're paying a lot more in HST than what they were getting back from the government.

Anybody raising kids knows how expensive it is and that HST is tagged onto everything you do. I've got to tell you myself that it just annoys the heck out of me to see it on my phone bill every month — right? — and to see that HST on many of the things I pay pop up. It is cumulative.

I'm certainly not raising children anymore, and I'm in a position where I can afford the extra $30, $40, $50, $60 a month that it might be costing me on some of my billings that I'm paying for or some of my other purchases. But it just annoys the living daylights out of me. I know that my neighbours feel the same way. I hear about it all the time. Nothing has annoyed people more than the HST.

[2030]

Even getting a cheque in the mail from the government to try and offset it has not in any way placated the people about how they have felt about the HST. So they're not going to be getting any more rebates under Bill 54. That has been very clear. That is going to drop dramatically back down to what the previous conditions were under the PST. We accept that, Madam Speaker. We accept that for what it is.

I do think at this point, though, that there probably will be analysis done after the fact to say that this entire exercise we went through for the last couple of years, from the PST to the HST, back to the PST…. I'm so glad to see the Minister of Finance here, because I think this will forever be labelled as "his stupid tax." I say that with the greatest of respect to the Finance Minister.

You have to ask yourself: "What's the whole exercise been about?" Did we see a catastrophic sort of collapse of our economy under the previous PST? No. Under the HST we did see a huge shift of tax burden away from big business and onto the backs of families and consumers. Yes, that occurred. The people of British Columbia rose up and said, "We're not putting up with this," and went through a referendum which was historic in its nature.

Now we find ourselves returning back to page 1. We're going back to Bill 54, the Provincial Sales Tax Act. Although I'm not going to debate whether or not, as the Minister of Finance has categorized this, it's a stupid tax, it has seemed to me to be a bit of a stupid process.

I would suggest that some of the things that we lost along the way it looks like we're not going to recapture either. Part of what happened in that whole process of transferring to the HST is that we lost a lot of green initiatives that were undertaken. I am glad to see that things like a luxury-car surtax are back. I'm sad to see that we're not going to gain back some of the incentives we had for energy-efficient products. I understand that these cost money, and all of these have huge impacts on the bottom line of government.

But it would just seem to me that every step of the way, from the 2009 election to this day — and sadly, for another year until the HST actually disappears — has been an exercise in really sort of battering the public opinion and pitting business against the average consumer.

Maybe the upside of that is that for the first time ever in British Columbia people are talking about taxation in a way they never have before. I mean, the HST certainly engaged people in a discussion about taxes. Usually, taxes have always been treated like a bit of a bad joke — right? Now we have people actually thinking about tax policy. So when we get into the PST, I will be interested to see what comes of many of the predictions that we saw in the past around what will happen in the future to our economy.

There has been much disagreement from financial experts on what the impact could have been, should have been, would have been under the HST. I haven't seen the same kinds of dire predictions that if we move back to the PST we're going to somehow collapse the economy of British Columbia. I have not seen any reports come out that tell us that the PST is good, bad or indifferent for us. So it's curious that all the hullabaloo we went through on the HST, touting what a great thing it was, and the money we spent….
[ Page 12072 ]

I think the member for Victoria–Beacon Hill, my good friend from Beacon Hill, outlined very clearly the kind of money that was squandered in the process of trying to promote the HST and legitimize the HST. Boy, when I think of where that money could have been better spent…. Again, eating through tax dollars, I think, has left really an unfair and sort of bitter taste in British Columbians' mouths.

Deputy Speaker: I'm directing you back to Bill 54, Member.

[2035]

M. Karagianis: Yeah. The whole concept, Madam Speaker, of returning to the PST I think is something that is well overdue, and so I'm happy to see us engage in this.

Now, it is 164 pages of legislation here. I confess I'm only partway through reading it, because some of it's pretty dry reading. So I have been using it at this point to kind of, you know, fight off insomnia. I'll continue to read this because there are a lot of details in this, many of them still yet to be fine-tuned.

I guess, as we move into this process of introducing and drafting regulations, we'll see exactly how much the government is prepared to really stay to the promise that this will adhere to the previous exemption regime. Perhaps we'll see if there is some kind of backlash, if our economy suddenly collapses, although I don't think it will. It didn't previously when we had the PST. I doubt that it's going to fall apart under the new PST.

It will be interesting to see what some of the modernization will do and how that will be interpreted. Many of the PST exemptions that we had were put in place after really thorough, laborious, year-after-year discussion with the manufacturing sector around productivity, making sure that we were exempting things like, you know, vital machinery that would help increase productivity.

We do suffer in British Columbia from a crisis of productivity, and I don't know whether we'll be able to recapture that. I don't think that has anything to do with our tax system. I think it has more to do with the way we have moved away from productivity and manufacturing in this province and become more and more reliant on our resource industry.

Will the PST have a huge and negative effect on that? I'm not entirely sure how I would understand it would because, frankly, the resources are there. They'll be extracted where they are. There's currently a debate going on here about the northern pipeline and tanker traffic and things and whether some of those profits will go offshore and not be left in this country, as with raw logs. All of those things are much more vital to the health of our economy than the shift in Bill 54 away from HST and back to PST.

The next year will be very telling as we watch the government implement each of these regulations and put the final touches on all of this, but, you know, the fact that the government has been so slow at reinstating the HST is just going to continue to annoy British Columbians for another year. I feel sad that the government is so cavalier about the public opinion on this that they don't see the importance of returning to the PST in a more timely fashion.

[Mr. Speaker in the chair.]

So with that, I will say that I am prepared to support this bill. I will be watching, of course, with great interest, as I'm sure will the public, what each step of the way will bring us in the way of the regulatory implementations and the details that will be put together.

I am happy to say I'll be supporting the bill. I look forward to hearing what others may have to say about this, and on behalf of the constituents of my riding, I'm really happy to have had a chance to stand up and speak on their behalf.

B. Routley: Bill 54 is certainly, in a lot of ways, a good day for democracy in British Columbia. We see that the people have been able to have their day and be heard, and the process, ultimately, has brought us to this day where the government has to acknowledge that the will of the people of British Columbia has spoken. Democracy has to mean something.

You know, after a decade of jiggery-pokery, where the government said one thing and did another, and not just once…. Over and over, we saw the same pattern. We saw the pattern with B.C. Rail. We had the government come to the table and assure the people of B.C.: "No, we're not going to be selling B.C. Rail. We will not sell B.C. Rail." Then they did. At the end of the day….

[2040]

Hon. K. Falcon: Get over it.

B. Routley: Oh, and the Minister of Finance says: "Get over it." Get over it.

It's just jiggery-pokery. It's just like some kind of "better stupid." What kind of a comment is that? That's a government that shows disrespect and contempt for the good people of British Columbia who, when they have their say, ought to be treated with the dignity and respect that they deserve. In a real democracy, that's what should happen. People should be saying: "All right." Furthermore, they should be getting on with the job of putting them back where they rightfully belong.

We were told in this House, and we heard this excuse over and over, "Oh well, it's so complicated" — this tax that business has been used to since 1948. You really want us to believe that a tax that's been in place since 1948…? "Oh me, oh my. It's going to be so difficult to explain to everybody. But we're going to plug in…. Oh, we're going to have to…. We've probably shredded all of the old documents, eh?"

Is that what happened? I believe that the Liberal government — along with their leaflet, their $800,000 leaflet
[ Page 12073 ]
— probably shredded all of the old things. They can't plug it back in. It is all gone. "Oops. Oh me, oh my. It's just gone." So we had this deception. At the end of the day, we were told….

Anybody else — anyone at all — could have said: "You know, these are difficult times." They could have said: "It's difficult times. We're planning on a deficit of $495 million." But no. No, that's not what we got. The good people of British Columbia were told: "It's going to be $495 million — and no more."

That was the statement over and over again. It was one of those deceptions. And what did we get? We had this government say: "We're not going to…. Oh, we're…." You know, they were asked by the good people from the restaurant association. We had a nice…. I had to go over for the novelty, to find out what a Happy Meal over at the….

Mr. Speaker: Member, could you please take your seat.

By agreement, we're moving into a voting procedure for committee stage, and we'll reserve the right for you for tomorrow morning. Member, could you adjourn debate.

B. Routley: Okay. Noting the time, I move adjournment of the debate.

B. Routley moved adjournment of debate.

Motion approved.

D. Black: Mr. Speaker, Committee of the Whole, Section A, reports progress on Bill 41, pending deferred divisions on sections 80, 84 and 85. The committee further reports Bill 36 complete without amendment and reports progress on Bill 37.

Report and
Third Reading of Bills

BILL 36 — SCHOOL AMENDMENT ACT, 2012

Bill 36, School Amendment Act, 2012, reported complete without amendment, read a third time and passed.

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

[2045]

Hon. R. Coleman: I call committee on Bill 41.

Committee of the Whole House

BILL 41 — MISCELLANEOUS STATUTES
AMENDMENT ACT (No. 2), 2012

(continued)

The House in Committee of the Whole (Section B) on Bill 41; L. Reid in the chair.

The committee met at 8:48 p.m.

[2050]

The Chair: Deferred divisions. Hon. Members, for your information, I believe that by agreement we are waiving the time.

Section 80 approved on the following division:

Section 84 approved on the following division:

[2055]

The Chair: Again, by agreement, we've assumed the time has been waived.

Section 85 approved on the following division:

The Chair: Hon. Members, section 80, section 84 and section 85 have now passed. Shall section 96 pass?

Section 96 approved.

Title approved.

Hon. S. Bond: I move that the committee rise and report the bill complete without amendment.

Motion approved.

The committee rose at 8:57 p.m.

The House resumed; Mr. Speaker in the chair.

Report and
Third Reading of Bills

BILL 41 — MISCELLANEOUS STATUTES
AMENDMENT ACT (No. 2), 2012

Bill 41, Miscellaneous Statutes Amendment Act (No. 2), 2012, reported complete without amendment, read a third time and passed.

Hon. T. Lake moved adjournment of the House.

Motion approved.

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

The House adjourned at 8:58 p.m.

PROCEEDINGS IN THE
DOUGLAS FIR ROOM

Committee of the Whole House

BILL 41 — MISCELLANEOUS STATUTES
AMENDMENT ACT (No. 2), 2012

(continued)

The House in Committee of the Whole (Section A) on Bill 41; D. Black in the chair.

The committee met at 2:44 p.m.
[ Page 12075 ]

On section 73 (continued).

L. Krog: It's always a pleasure to rise and speak to a forestry section of a miscellaneous statutes amendment act. A very straightforward question for the minister in these circumstances: could he explain the effect of section 73?

Hon. S. Thomson: Section 73 provides retroactivity for the earlier part of the statutes amendment act that we brought through. This was the situation where there was a gap identified on deposits that are made. If a person makes an application and provides us a deposit when they're making an application and if they don't follow through with that, then that deposit is forfeited.

[1445]

That was standard practice, but we had a gap in the legislation that we needed to fix. What this does is make it retroactive back to the time when the original amendment was put in place. The gap was there, so we fixed the gap. Now we just need to have the retroactive provision so that the deposits, which were standard business practice, that we forfeited are able to be kept by the province.

L. Krog: If the minister can confirm. My understanding of his answer is this. The government has collected the money. The government doesn't want to pay back the money. Unless we pass this section, then the government has to pay back the money, in fact, to those who made the deposits. Is that correct?

Hon. S. Thomson: Yes. If they were to challenge us, they would probably be successful in that because of the gap in the legislation.

L. Krog: Can the minister give the committee some idea of what amount of money is involved with respect to these deposits?

Hon. S. Thomson: I'm advised that on average there are six to seven deposits of that nature on an annual basis. They're application deposits, so they're generally of a lower amount because once the application is accepted, then they provide the performance deposits.

We could provide a specific number. We would need to do a little bit of research just to get you an exact quantum on those numbers. I'm advised that they are relatively minor in total. I think it's important to recognize that what we wanted to do was provide direct activity and fill the gap.

L. Krog: With respect to the minister's answer that they're a small number now…. We deal with the government of British Columbia — maybe $100 million isn't a big number compared to the total budget. Where I come from, $1,000 in your pocket might be a big number. I guess I'd appreciate if the minister would give me some idea of the range of moneys that we're actually talking about with respect to a "small amount" of money.

Hon. S. Thomson: Again, to reiterate. The situation here is that this has been standard practice. When people make the application to make the deposits, they know that if they don't follow through in the agreement, those deposits are forfeited. There are, as I said, five to six annually, in terms of the number of deposits.

What we will undertake to do is to provide the specific information on the number. I'm advised that they're relatively minor, because they are application deposits, not the actual completion of the agreement, where they're paying the higher rate of deposits on those.

Again, I'm advised this is standard practice. Everybody has accepted that this is the normal practice, the normal procedure. There's not an expectation that if they don't follow through on the agreement, they get their deposit back. We're just ensuring that we provide that retroactive provision for it back to 2008 when the original amendment was made.

L. Krog: I'm not trying to be difficult. I'm quite serious when I would cheekily suggest of the minister: what's the range of numbers? Are we talking a dollar to up to a $1 million? Are we talking a dollar up to $10,000? Are we talking a dollar up to $5,000? What's the likely range?

[1450]

I'm keeping in mind the minister doesn't have his figures in front of him. I appreciate that. I'm not asking to hold him to this. I'm simply asking the question generally. What's the range when we're talking about this "small number"?

Hon. S. Thomson: I'm advised that they're in the range — because this is generally on the smaller agreements; it doesn't happen on the larger deposits — of $1,000.

B. Routley: I'd like to thank the minister and his staff for their indulgence in going through some of these issues. I'd like to know what was special about the date December 9, 2008. What was in place prior to that date? Is that at all important to this particular date? Why that date and not some other date?

Hon. S. Thomson: That's the date that the amendment to section 151 was brought into force, so that's when the gap was inadvertently put in place at that point. That takes retroactivity back to the date when the original amendment was made.

B. Routley: Moving on to (2) of 73, it says: "All things done during the validation period that would have been validly done…." So the validation period — is that this new period from December 9, 2008, to the date that this becomes in force? What exactly is the validation period?
[ Page 12076 ]

Hon. S. Thomson: The date is from December 9 forward to the date when this amendment comes into force.

B. Routley: Just for greater clarity and certainty, the next part of (2), where it says, "…that would have been validly done had section 151 (11) of the Forest Act, as amended by this Bill, been in force on the day they were done are conclusively deemed to have been validly done" — what's the rationale for this particular verbiage?

Hon. S. Thomson: What this does is it makes this provision specific to what we're fixing here.

[1455]

It goes directly back to what the fix has put in, in putting applicant in place. So it only relates to the provisions of forfeiture of deposit. When an applicant didn't follow through on the awarding of the application, do we forfeit the deposit? It makes it specific to that event only and not to other processes or other mistakes that might have been made. It narrows the validation provisions specifically to the gap that we're fixing in the legislation.

B. Routley: Do you have any idea of the total sum of the amount of forfeitures of deposits that have taken place — where this legislation is trying to fill this gap? Do you have a number? Or is that a number that you're going to be able to get us in writing at some point?

Hon. S. Thomson: In response to the previous questions from the member for Nanaimo, we're advised that it's five or six applications per year in the range of $1,000 or so, in that range. If you look at that over the total time period from December 2008 to now, for roughly 20 or 25 deposits that have been forfeited, it's somewhere in the range of $25,000 to $30,000. As I indicated, we can undertake to provide that specific number.

B. Routley: Finally, in finishing up point No. 3…. Again, it does strike one as somewhat humorous. I mean, I found this…. I talked about it as either the ultimate in bafflegab or, certainly, kind of a jiggery-pokery language. I'm sure the minister will have a fulsome explanation for this next one.

"This section is retroactive to the extent necessary to give full force and effect to its provisions and must not be construed" — my, my, with emphasis — "as lacking retroactive effect in relation to any matter because it makes no specific reference to that matter."

The specific reference. Can we at least here be comforted that this "no specific reference to that matter…"? Is it limited? Is there any reason why we couldn't have actually talked about deposits? It does lead one to believe that it could be far-ranging, far beyond just deposits. Is there any reason why we couldn't use specific words like "as per the deposits"? That would give one comfort, knowing that you were dealing with a specific problem. But this language does seem to be fairly broad.

Hon. S. Thomson: I'm not a lawyer, in terms of the wording that has been used. But the way that it….

L. Krog: Is that a complaint or an admission?

Hon. S. Thomson: No, it's not. Neither.

Just to go back. Subsection (2) is the one that narrows it and makes it specific to the deposit process.

[1500]

Section (3) provides the overall protection that gives the scope where it is applied. While it's being applied specifically, it provides that there aren't any gaps or provisions that could be argued against the general retroactive nature of the provisions. It's consistent with the wording that is used in this purpose and other legislation.

For example, in Bill 50 in 1998, the miscellaneous statutes amendment act had that provision in section (4): "This section is retroactive to the extent necessary to give full force and effect to its provisions and must not be construed as lacking retroactive effect in relation to any matter because it makes no specific reference…." It's consistent wording that is used in legislation throughout, where the retroactive provisions are meant to be specific, but also to provide the overall, general application of the retroactive effect.

B. Routley: Just for greater certainty again. You referred to section (2) as being somehow related to the word "deposit." There's no such word "deposit." I assume what you're meaning there is the reference to section 151(11) of the Forest Act. Is that correct?

Hon. S. Thomson: That's correct.

Section 73 approved.

The Chair: We've passed sections 74 to 79, so we now move into the justice amendments, I believe on the Election Act, section 80. We'll just take a moment to switch ministers.

On section 80.

L. Krog: To the minister, if she can explain the effect of section 80 on the existing Election Act.

Hon. S. Bond: I'd like to thank my staff for being here today, Doug Eastwood and Neil Reimer, who are, I'm sure, familiar to most members of the House.

This section actually inserts a single definition of the term "pre-campaign period," which would be used consistently throughout the act. Probably the most significant change is that the pre-campaign period would be shortened from 60 days to 40 days. It also provides a
[ Page 12077 ]
legislated period of 21 days after the assembly stops sitting, during which the pre-campaign period would not be in effect for spending limits.

It's a direct response to some of the concerns expressed by the court. So there will be a 21-day, for lack of better term, what I call a buffer period between the rising of the Legislature and the beginning of the pre-campaign period restrictions.

L. Krog: Then I take it that it is possible that in fact it would be a 61-day period in total, depending on the date of the election being called. Or am I not hearing that correctly?

Hon. S. Bond: The maximum number of days where the restriction would be in place would be 40 days. So from whenever the House rises, there would be a 21-day period, and what would shorten would be the 40-day period.

[1505]

L. Krog: If I understand this correctly, then, it could be as little as 21 days with a maximum of 40, the period during which there would be limits on campaign spending by other groups.

Hon. S. Bond: There will always be a buffer period. What shrinks is the 40-day period. Let's say the House ran as long as it did, and there were only 21 days left between the House rising and the writ being dropped. That would be the buffer period.

L. Krog: I think that's what I was trying to say to the minister in my earlier question. It's a minimum of 21 days potentially.

Hon. S. Bond: It could be less.

L. Krog: Listening with my big ears that come from my Grandmother Clarke's side of the family and still function reasonably well….

K. Krueger: Almost too much information.

L. Krog: And too many comments from the member from Kamloops, but that's a story for another day.

So it could be less than 21 days. The period includes the election. It's a 28-day campaign period. There are limits. Then, is the minister saying, in fact, preceding the election, it could be less than 21 days — the commencement of the election period?

Hon. S. Bond: In fact, if the House rose late enough…. Because we have a fixed election date, which is why this whole matter is an issue for us, we know now when the writ will be dropped. So if the House were to sit until very close to the writ being dropped, there would be no pre-campaign period and no restrictions. You could actually advertise right up to the period where the writ is dropped.

The maximum pre-campaign period is 40 days, under this revision, and a 21-day buffer period, unless the House sits longer.

One of the concerns the court expressed was the concern about making sure that when the House is sitting, there needs to be the ability for people to advertise and to discuss those issues in front of the House. We then built in a 21-day buffer period so that when the House rises, there are still issues of importance where there should be general debate.

It could be that in fact the buffer moves right into the writ being dropped because the House stays in session long enough that there is no pre-campaign period.

K. Corrigan: Just to get it clear. I think I've got it. The shortest period that there could be between when the House ends and the election, in order to have the full 40 days, would be 61 days — right? I think that's probably what my colleague was getting at.

Hon. S. Bond: We think that's correct, in terms of the way the member opposite has described it. Ultimately, the maximum you would have is a 40-day pre-campaign period and a 21-day buffer period, meaning 61 days.

What triggers the beginning of the counting is the rising of the Legislature. All of it, all of the dates and the number of days, are triggered by the rising of the Legislature.

K. Corrigan: Just following up on that, then. If the period between the end of the Legislature and the dropping of the writ was 21 days, then there would be no days — correct?

[1510]

Hon. S. Bond: That's correct. There would be no pre-campaign restrictions because there would be no pre-campaign. The 21 days is the buffer period.

L. Krog: I wonder if the Attorney General could comment on the B.C. Court of Appeal ruling that upheld the court's earlier decision respecting this section. Exactly what was the real thrust of the court decision that led us to this change? Because right now this section, in theory, if you look at the books, still exists. If you were a stranger looking at the statutes of B.C., you'd see this existing section. You'd think that was the law. But in fact, there's a court decision that says: "No, it's not effective."

Hon. S. Bond: I'm advised by two very capable staff that the core concern was the overlapping of restrictions of advertising and the sitting of the Legislature. A good example of that would be that a budget would likely be,
[ Page 12078 ]
and is, brought down during that period of time, and because of the overlap, there would be no discussion, no ability to have that public discourse about the budget.

Because election advertising is broadly defined, there is the concern. The core concern was, certainly, I'm advised, that period that overlapped the Legislature sitting. Our revisions address that directly, so that while the House is sitting, there are no restrictions, and 21 days following the rising of the Legislature, there are no restrictions.

L. Krog: If we can sort of do some calculating back here. The election is May 14. The writ is dropped 28 days prior, so that takes us to, I think, April 16. I'll rely on your able staff to do this better than I. Someone's kindly provided a calendar to the minister.

If the House sits until April 1, as an example — rises on April 1 — what's the effect of this section on that period from April 1 to April 16?

Hon. S. Bond: There would be no pre-campaign period and no advertising restrictions.

L. Krog: In practical terms, what that means is if I've paid for advertising saying the government's budget is awful, then I'm not restricted whatsoever unless that advertising continues after April 16, the day the writ is dropped.

Hon. S. Bond: That would be correct. The restrictions during the campaign period were actually upheld by the court, so that would be true. Those restrictions would then be relevant.

J. Brar: My understanding is the 21 days is after, basically, the session is adjourned — right? — 21 days after that. I just wanted to ask the minister: on what basis did you arrive at 21 days as sufficient time for any stakeholders of any group to debate the issues, you know, that were part of the session?

Hon. S. Bond: As is the case with other rulings of the court, it's a judgment call. It's our best effort to interpret the concern expressed about the overlap with the House and a reasonable opportunity for people to respond to issues that are dealt with in the House.

This, we believe, is a reasonable response to the concerns. It's a reasonable period of time where people will still have the opportunity to express their views about whatever issues have been relevant for them in the House.

[1515]

J. Brar: Thanks to the minister for the response. So it's a judgment call. Basically, that's the bottom line when we talk about 21 days. It's not based on any kind of data or any kind of research that the majority of the issues just end up after or within 21 days.

At the same time, if you look at the HST example — right? — that was a piece of legislation passed during the session, for example, and it continued and will continue almost four years. We were there for signing the petitions. Then we went on to the referendum and all that.

Having said that, I would like to ask the minister as to how we now say 21 days are enough for any debate which comes out of the budget or out of the session at that time.

Hon. S. Bond: I'll answer the relevant part of that question, which was to the Election Act. That would be the part that talks about the 21 days. I said to the member that the best advice…. The legal team that looked at the revisions believed that was a reasonable period of time. The concern of the courts was primarily focused around the time the Legislature was sitting and the importance of having the ability to be able to respond to that with advertising.

In fact, this is the best advice we've received. The fact of the matter is it's our view that 21 days is a reasonable buffer between the House rising and the beginning of the pre-campaign period.

K. Corrigan: I'm wondering if the minister is aware of any suggestions that this change, this amended version of the gag law, is possibly going to be challenged in the court.

Hon. S. Bond: Well, in fact, our intent is to refer this to the courts.

L. Krog: I don't wish to be cheeky to the minister. She says that is the intent. But is that a commitment by government — that in fact this will be referred to the courts?

Hon. S. Bond: Yes, we are referring it to the court.

L. Krog: Just back to the court decision, was there anything in the judgment that indicated the courts were satisfied that trying to limit expenditures outside of the campaign period at all was, in fact, permitted under the constitution, the Charter of Rights and Freedoms?

Hon. S. Bond: I will read into the record a quote from Mr. Justice Cole of the Supreme Court. He said: "None of the other Canadian jurisdictions with fixed date elections impose restrictions on third-party advertising during the pre-campaign period. This alone, however, is not evidence that it is unreasonable to do so."

L. Krog: I take it, in fairness, that that is still the case as far as the other jurisdictions in this country — all of the other provinces and territories — are concerned when it comes to elections. There are, in fact, no legal restrictions on spending outside of the campaign period.

[1520]

Hon. S. Bond: To the best of our knowledge, that's correct. Not in Canada but certainly in other Commonwealth jurisdictions, there are restrictions.

L. Krog: I wonder if the minister could advise: what Commonwealth jurisdictions? And what's the range with respect to this legislation? I assume it's somewhat varied, because this is, frankly — as the minister well knows — a unique experience in Canada, as she has stated for the record and as I understand it. I'd be very intrigued to know what countries, quite specifically, have these pre-campaign-period spending restrictions. And what's the timing of those restrictions?

Hon. S. Bond: I'll just give the member the list, as best I can, in summary. In the United Kingdom limits apply 365 days retroactively, and the limit is $790,000. In Scotland, Wales and Northern Ireland the limits apply 120 days prior to the election. In Scotland the limit is $145,000; in Wales, $57,300; and in Northern Ireland, $29,233. In New Zealand limits apply between three months and one year — usually ten months, as elections occur predictably in the fall — and their limit is $85,000.

L. Krog: I appreciate the minister's answer. I'm quite struck by the term "retroactively" used here, and I'm trying to understand how that could possibly function in a jurisdiction where it's a parliamentary democracy and the government could fall at any time. I mean, how does that legislation effectively work there?

Hon. S. Bond: Well, our staff that are here today don't have the specifics of how it works. They just know that there's a long history. In fact, they've had a very significant set of restrictions in place for a significant period of time.

L. Krog: To clarify, given that some of the government's basis, if you will, for this legislation is the precedent of these other jurisdictions that the minister has mentioned in her responses, I'm intrigued to know — and I don't pretend to be an expert — do any of those jurisdictions have something equal to or to be equated with our Charter of Rights and Freedoms or our constitution?

Hon. S. Bond: I know the member opposite wasn't implying that, but I don't think it's accurate to describe this as being the reason or the model — that the reason we looked at this was because of the U.K. or Scotland and Wales. It is a balancing act, and it is unfair in some ways, I think, to characterize this as attempting to unfairly limit free speech. We don't believe that to be the case. We believe it is about balancing interests.

I'm fully aware and appreciative of the constitutionality of being able to speak your mind, but we do believe that there is a different set of circumstances under fixed election dates, and there does need to be a level playing field. We only have to look to our neighbour to the south to be able to actually see what people who have large amounts of money are actually able to do in a pre-campaign kind of way.

[1525]

This attempt is, you know, looking at being reasonable, and I think it is reasonable. The court will look at this and will look at that issue. In fact, Mr. Justice Cole left the door open, saying it isn't necessarily unreasonable to consider those limits. What the court is concerned about is the length of that time. I think it isn't about patterning ourselves after anyone else. It's about saying: "How do we make sure we balance those interests?" We believe this is a reasonable approach to doing that.

L. Krog: When the government initially introduced this legislation, it was a 120-day limit. Then, on its own amendment, as I recall, it was reduced to 60. That was, in fact, what was passed by the Legislature. I'm wondering: did the court comment in any way or give any hint as to what it thought of 120 days versus 60 days, as opposed to…? Obviously, clearly outside…. Did the court give any indication of what it thought of the possibility, with great respect, of simply dropping the number from 60 to 40?

Hon. S. Bond: The key concern — at least, the best advice I've been given — was less related to the number of days than it was about the overlap. When the House was sitting, that was a primary concern. That is why we made the decision to build in the 21-day period following the House rising. People do want to have their views about the budget. They want to have those kinds of important discussions. The court didn't narrow in the discussion around the number of days. The primary concern was the overlap of the restrictions with the House sitting.

L. Krog: Just so I'm clear, the concern was the House sitting generally. It wasn't just in relation to the budget. Is that fair to say?

Hon. S. Bond: That's correct. I used the example of the budget because I understand the importance of people having the ability to respond to that. The example of the budget was mine. The court spoke more generally about overlap.

L. Krog: With respect to this legislation, since the court case — the initial Supreme Court decision that struck down this particular provision relating to the pre-election-campaign spending limits — have any groups come forward to the minister or to the ministry, to the minister's knowledge, that have requested the imposition of these kinds of restrictions?
[ Page 12080 ]

Hon. S. Bond: My staff remind me that the appeal concluded in October of 2011 — not a long window of time. But certainly not to our knowledge and certainly not to my knowledge has anyone come and specifically requested that change.

L. Krog: Perhaps I should have been clearer to the minister. What I'm talking about…. When the Supreme Court struck this down, as opposed to the B.C. Court of Appeal hearing the appeal of the trial judge's decision…. From the date of the trial judge's decision, when it was made public, have any groups come forward and said: "We want to see the government try and reimpose pre-campaign spending limits"?

[1530]

Hon. S. Bond: My answer remains the same. To our knowledge, we can't articulate a specific group that said: "Come and do this for us." Certainly, informally, there have been conversations and even public debates about the importance of ensuring that the wealthy and those who have significant fiscal resources don't dominate the discussion prior to an election period.

We have no recollection, at least, or awareness — as the member opposite would know, I'm new to the file — of any specific requests, but there's certainly a general discussion, even publicly, that talks about the need potentially to make sure that the wealthy don't dominate the discussion.

L. Krog: I'm wondering if the ministry has any evidence of the expenditures that would have caused the government to consider this policy. I call it policy at this point because we don't have that law in British Columbia anymore.

I mean, what was the motivating factor for bringing forward this legislation? Again, were there other groups, prior to the introduction of the act, which came forward and said: "We really have to have this. This is important"?

In other words, I'm looking for some kind of justification or rationale for the government to do this in light of the Harper v. Canada decision, etc. Where was the public clamour for this? Where was the demand coming from?

One gets the usual concern that governments sometimes create the solution and then go looking for the problem. I suspect that this may be a case like that, particularly given the history of attempts by a previous government to do the same kind of thing.

Hon. S. Bond: As we've said, we're not aware of there being a group or two that came and asked. But I think there was a trigger for some of the discussion: that we made a decision to look at electoral reform. We looked at and led the country in talking about fixed election dates, and fixed election dates change the dynamics of elections.

One of the things that it certainly doesn't take a lot of research or study to note is that election advertising occurs earlier and earlier when you know when the date of the election is going to be.

This is an approach that looks at: what is a reasonable balance? Obviously, we've had to learn from the experience in the courts to talk about what a reasonable period is where there could be an overwhelming representation by those who have more wealth than others.

What's our motivation? Our motivation is to ensure there's a level playing field. The goal here is to find a balance between the ability to…. We respect and appreciate the right to have a person's say. That's exactly why it's important that that playing field be levelled.

Again, I use the example of our neighbours to the south. Those who have a lot of money have a lot of influence in the electoral process. Our motivation is to level the playing field.

K. Corrigan: Does the minister have any concerns about the perception, which I've heard in the public, that what the government essentially is doing here is trying to edge up as closely as it possibly can to being unconstitutional, that in doing this appeal it's just seeing where the line is and that — if this is referenced back to the court and the court again says it's unconstitutional — perhaps there'll be another try to bring this in? Is there any concern about that perception?

[1535]

Hon. S. Bond: That's not the intention at all. What the intention is, is to find a level playing field so that when British Columbians make choices about who they're going to vote for, the landscape isn't dominated by people who have more money than anyone else.

You know, I've listened on a number of pieces of legislation over the last few days about the government bringing in legislation that then needs to be corrected in the courts. Well, the last time I checked, I can't read the court's mind and neither can the legal team. What we can do is our best to protect the rights under the constitution. Sometimes we don't get it right completely. IRPs are a really good example of that.

I believe passionately and fervently in ensuring that people do not drink and drive in British Columbia. We had to go back, and I'm not embarrassed or upset by that by any stretch of the imagination. We led the country in our initiative to keep drunk drivers off the roads, and it meant we had to go back to make sure we got it right. At the end of the day, 40 people's lives were saved.

Of course it's a balance. It's a balance of protecting the constitutional rights of British Columbians but making change. We have other bills in front of the House that are looking at unique innovation. Do we get it right every time? We want to. We do our best to. But at some point there may be a need for revision. I'm actually proud of the fact that we have an aggressive, innovative agenda.
[ Page 12081 ]

K. Corrigan: While I appreciate the minister's defence of this, my concern remains that really, what is happening here is that the government is making the choice to bring in legislation that, presumably, government knew in the first iteration and now knows in the second iteration is either over the line or close to the line in terms of offending the Charter. My question was: is there a concern about that perception?

Hon. S. Bond: Government doesn't knowingly decide they're going to breach the constitution. In fact, we have exceptional people who work on the legal teams. Their job is to bring form and law to ideas and to innovation and to changes. Their job is to do the very best they can to ensure that we constitutionally create appropriate laws in British Columbia.

To suggest otherwise is unfortunate. That is not at all the attempt. But it does mean we're not going to be satisfied with the status quo. Yes, there are times when legislation is brought before the House — and, in fact, supported by both sides of the House, which would be the case with roadside prohibitions, for example — which occasionally needs additional guidance from the courts.

I don't think that should prevent governments from being innovative and looking at transformational legislation. I would be far more worried about the perception that we don't care enough about issues like that to actually take the risks necessary to make changes in our province.

K. Corrigan: The minister just, I think, said that government doesn't knowingly breach the constitution. Surely, government, both with the first form and now with the revised form of this section, must have received legal advice that there could be a constitutional challenge. I recall, I believe, that members from this side of the House suggested in the House that there might be.

Hon. S. Bond: Well, I think there's a difference between being realistic about the fact that anytime you make changes that potentially impact a right, there is the potential of a constitutional challenge, broadly speaking…. But if we didn't do the kinds of work that we're doing, British Columbia would sit stagnant, dealing with issues with the status quo.

[1540]

We have an exceptional legal team. Of course, they come, and they provide advice. Believe me, they are extremely conservative and, might I say, risk-averse. That would be an understatement. So it is about trying to find that balance and to make sure that we are respectful of the constitution, at the same time looking at how we make changes in British Columbia that are in the public interest.

K. Corrigan: Well, the minister says that the legal team, who I know…. I have certainly met in briefings and so on with some of your advisers and members of the legal team — very, very well qualified, I have absolutely no doubt. I've been very impressed with any contact I've had with those members.

However, the minister talks about risk adverseness, yet we have found in a number of cases that whatever that is, the error has been made, if we want to call it an error as opposed to a breach — however you want to term it. The fact is we have gone over the line. So is the minister saying that the legislation brought in previously and now was brought in despite legal advice or with advice saying: "Look, I think it's quite possible that you could be over the line"?

Hon. S. Bond: I think — and I'm going to be really clear about this — that there is a difference between having the pragmatic and realistic view that when you are making changes to law, there may potentially be a risk of infringing. So of course you pay attention to what lawyers say. We don't normally, and people don't, discuss legal advice, specifically. Of course we pay attention to that.

To suggest that we know we're crossing the line and we shouldn't actually be pursuing this…. Again, going back to the ruling that the court gave us: "I am not persuaded that there are not other ways of dealing with election advertising that do not interfere with political speech while the Legislature is in session."

The court encouraged us to turn our mind to looking at how…. In fact, my previous quote was about the fact that Justice Cole didn't necessarily say that it was unreasonable to seek limits.

So our team went away, did the work, came back and said: "We've paid attention to what the court said. Here are some possibilities."

K. Corrigan: The minister talked about wanting to create a level playing field and talked about big spenders — you know, people not being able to…. I guess the idea is not what we think of in the U.S. as essentially buying elections.

So could the minister tell me: with both the original act and this act, what type of big spenders was the minister thinking of when bringing in this legislation?

[1545]

Hon. S. Bond: Well, I think we have to go back to the principle of the bill. The principle of the bill is about ensuring that whoever has a large quantity of a resource, a fiscal resource…. We're simply saying that there should be a level playing field.

When you have a fixed election date, the dates are known and we're seeing the period of time that people engage in election-type advertising expand. There is a view — and we hold that view — that because the date is known and there are people and organizations that
[ Page 12082 ]
have large sums of money on either side of the equation — pro, con, whoever…. The fact of the matter is that they should not dominate the political landscape during that critical period of time. That's the principle on which the revisions are based.

K. Corrigan: Well, the minister just referred to pro, con — either side. I note that the groups that challenged the original legislation, which has led to this revision and amendment, were labour unions.

Did the ministry hear from somebody who might be on the other side? They would be large donors for, say, business — those that had made large donations in the past or had spent a lot in previous elections. Did the minister hear from any of those types of corporate individuals, perhaps, who complained about this act in the original form?

Hon. S. Bond: I answered that question previously. To our knowledge, we haven't had a lineup of people saying: "Put this back in place." We based it on the principle of a level playing field, and I have not had any specific directions or requests from anyone regarding the bill.

K. Corrigan: Yes, I did hear the minister say that there was nobody clamouring to bring it back. What I wondered about was: were there other groups, other than perhaps those that actually challenged the bill, that came to the minister and said, "We don't like this bill," even if they didn't actually mount a legal challenge?

Hon. S. Bond: I'm certain there has been a lot of public debate about this issue from a number of sides, organizations, whoever they are. I have not had any formal representations to me from organizations about bringing the bill back.

I base bringing the bill forward on my view and the government's view that in the dynamic that's created with a fixed election date, British Columbians deserve the opportunity to express their views but there needs to be a level playing field. That's what the revisions are based on.

K. Corrigan: I wasn't asking about whether there was any clamouring to bring the bill back. What I was asking was: prior to the legal challenge or prior to the decision were there other corporate organizations that came to the minister and complained about the bill? Not after the decision was made.

Hon. S. Bond: I can't speak to the period of time before I was the minister. I have said repetitively that no one has spoken to me about this issue. The revisions were brought based on the principle of levelling the playing field.

L. Krog: I'm assuming that the government had some evidentiary basis during the court process. Obviously, not having been there, I can't determine what the evidence was that the government may have led with respect to its response to the legal challenge brought by the BCTF to this.

But was there any evidence presented by the government that indicated that in fact, the money that groups spent — for instance, around the 2005 election — actually had an impact on voter attitudes?

[1550]

Hon. S. Bond: The gentlemen joining me today were not part of the legal team. We don't have the factum and the transcripts in front of us, but I am assured that the principle that was argued was the fact that there was increased election spending in that period of time prior to the campaign. The information and the principles would have been the same as we have shared here today.

L. Krog: I wonder if the minister can advise, without being referenced to the numbers specifically, whether there was any evidence that the side, so to speak, that presumably may have been opposed to the B.C. Liberal Party in fact spent more money.

We all know what the result of the election was. The NDP lost, and the Liberals won. So I'm just curious. Was there in fact even any evidence there that the party that spent the most money produced the desired result?

Hon. S. Bond: The principle that's being discussed and reflected in these revisions isn't related to the outcome of an election. If the member opposite's supposition were correct and we were concerned about others…. The B.C. Liberals actually won the election, despite those issues.

In fact, this is a principled discussion — from my perspective, at least. I can't comment on issues when I wasn't the minister. I can only comment on the revisions that I've brought to the House.

This is based on a principle that when you have a fixed election date and you have organizations, be they corporations or unions — or individuals, for that matter — who have an ability to use more fiscal resources than others, there is a concern about making sure there is a level playing field. At the end of the day, it's not about the outcome of the election; it's about the process that leads up to that election.

L. Krog: The minister grasps my point. The fact is that the B.C. Liberals won the election, notwithstanding all the money that was spent on the other side. So the principle here is free speech. I'm curious to understand. Given that the only evidence we have surrounding a fixed election date and expenditure…. Where's the evidence to support the proposition that we need this?

Again, I come back to my point. It's a solution looking for a problem. On the face of it, with the only evidence
[ Page 12083 ]
and fact pattern available in British Columbia's political experience indicating that in fact spending all the money doesn't make a hill of beans' worth of difference, why are we doing this?

Hon. S. Bond: Well, I guess the principle of free speech means free speech and not the ability for a particularly well-funded individual or organization being able to dominate the discussion. I actually believe that free speech means that everyone should have the opportunity to participate equally in a process.

So it is about a principle. It's not about the outcome. At the end of the day, despite all of the efforts and all of the issues related to an election, it wasn't about the outcomes. I believe that free speech means just that. It is a matter of finding balance, so our goal is to ensure that that principle is upheld and that those who have the deepest pockets don't dominate the discussion.

L. Krog: I appreciate the concern expressed around what has happened in the United States. The minister raised that earlier in the debate today. I understand that. It's kind of distasteful. It's not pretty to watch. You turn on an American TV station during an election campaign, and the vile things that are said back and forth and the allegations made and the basis on which some people seem to vote, having heard that information, is really quite distasteful.

[1555]

But that is not the Canadian situation. We have campaign disclosure laws with respect to political parties. We have a pretty good idea who funds parties, right down to, as I recall the Election Act, $200. I think a $200 or $250 donation requires disclosure of where it came from. So we have amazingly strict disclosure laws.

The concept that those who would support any political party or position…. The possibility that that's how it's covered seems to me a far more reasonable way to approach the problem than to say: "Look, you just don't get to spend any money, subject to $3,000" — $3,000, I believe, is the figure — "per electoral district and $150,000 overall." Putting those kinds of restrictions on it, again in light of the lack of evidence to support this proposition, doesn't seem reasonable.

I'm curious. Have any of the political parties in the province passed a resolution, sent a letter on to the government that indicates they support this legislation?

Hon. S. Bond: Again, I'm not aware of any specific letters, and neither are my staff. To the member's point, knowing who made the large donations doesn't change the fact that they still made the large advertising budgets. It doesn't change the fact that they still have the ability to dominate the landscape.

Disclosure is an issue. As the member rightly points out, we have very significant disclosure expectations. It doesn't change the fact that…. So you disclosed you spent a lot of money. At the end of the day, it still tips the playing field. Our view — and I will continue to reiterate this — is that if you do truly believe in the concept of free speech, is it truly free speech if the deep pockets dominate? That's the premise.

L. Krog: To give the minister an example of money trying to dominate an election campaign, I recall an election that Joy Leach won to be mayor of Nanaimo. It was an organized campaign, headed largely by one developer who wasn't happy with the way the city of Nanaimo was treating him. He actually sponsored a slate of candidates in the community.

Nanaimo, for the minister's information, is a community that historically has tended, I would say, based on my political judgment, to elect councils that tended to be centre-right as opposed to centre-left.

Every one of those candidates sponsored by that developer…. When it was known in the community and articulated in the press by comment that that campaign was spending a great deal of money on a municipal election, the mayoral candidate and all of the council candidates they ran were all soundly defeated.

My point — and I come back to it — is that it's not the amount of money; it's whether or not it's known. We have campaign contribution laws now that disclose pretty readily who's donating what to which party — indeed, down to the names of individuals, corporations, etc. Surely, that is the better approach to take, rather than attempt to limit what may be free speech.

There are lots of little organizations that may wish to express a view outside of the campaign period. It's not so much from the express interest of influencing a person to vote one way or the other — that's the judgment call that these organizations face — but simply trying to educate the public around an issue that they believe is important, whether it is genetically modified foods or smart meters or pesticides or protection of a particular environmentally and ecologically sensitive area — all of those things. Those are the concerns.

[1600]

Those organizations…. With great respect, some of them have indicated to me, as one of the co-critics for this ministry, that they are indeed concerned and have withdrawn from making comments at a time when they may wish to and think it appropriate to do so because they don't want to face the possibility that they are parties who should be registered under the act. Even though what they're saying within the traditional sense, the common understanding of the term…. They aren't making political comments. They're simply trying to raise an issue.

That is one of the concerns, and I'd like to hear the minister's response to that. If the effect of this is to diminish free speech, then surely that's not what the minister or the government's intent is with this legislation.
[ Page 12084 ]

I have heard repeatedly here today that the intent is to keep big money out of politics, to restrict it so that you can't buy or influence an election. I simply suggest to the minister that the evidence may well be that groups are being discouraged by this — particularly smaller groups, a local group, a small chapter of the B.C. Wildlife Federation or the Canadian naturalists, or whoever. I'd like to hear the minister's comments on that.

Hon. S. Bond: Thank you to the member opposite. We are going to, as we do respectfully many times, agree to disagree. I don't believe that disclosing who is spending something is the key determinant in influencing or providing the kinds of transparency and level playing field that we need to look at. It's not about who; it's about how much. It's about levelling the playing field.

To suggest that small organizations won't be able to have a role…. We actually think spending up to $150,000 is a pretty reasonable limit. And there are lots of other avenues. This is talking about paid advertising that is advocating a particular position. There are definitions of election advertising. I'm sure we're going to have that discussion too.

The bottom line is that there are lots of ways for people to express their views. What we're saying is that we believe that the key principle isn't about having to disclose how much you're spending. It's what role there is for people, organizations, individuals and corporations with deep pockets to be dominating the discussion.

Of course I'm concerned that small organizations have the ability to express their views. I do believe that with the limits that would be in place during a reasonable period of time, they would still very much have the ability to do that.

L. Krog: Let me try and give a bit of an example or an analogy. We have speed limits in the province of British Columbia. We have speed limits for a purpose. To drive over that speed, we have determined collectively as a society, is dangerous — not just to the driver but to other drivers on the road.

The effect of that, if it works well, is that you drive below the speed limit and thereby promote public safety. Anybody who has eyes to see and the ability to read can look at the sign, and it says: "80 kilometres an hour maximum." They get it. Everyone understands that. You don't require a lawyer or an adviser or an advocacy group or assistance in determining what the law is.

But if you're the little group in my community that is now trying to organize to encourage government to purchase lands to expand the Linley Valley protected area…. With great respect, if they want to put an advertisement in the paper that may or may not constitute election advertising, they're going to have to seek advice on that. They're not going to have the money or the resources or the likely access to someone who can say: "You know what? You're probably okay to put this in the paper" or "No, you're probably going to risk breaching the act."

[1605]

The reality is that the people with the least resources are going to be the ones most likely, in fact, to have their ability to promote an issue restricted, as opposed to the people who can spend $150,000, who will be in a position to say: "We'll get Fasken Martineau or McMillan LLP or whoever to give us a nice legal opinion for 15,000 or 20,000 or 30,000 bucks, and we'll go ahead and do it."

I'm looking for the minister's response. I used the speeding one because it's a nice simple one. But when it comes to these difficult questions, we can spend hours going through this act. The minister needs advice to determine exactly how to answer the questions. The legislation comes up through the ministry. With great respect, there aren't clear lines.

My question to the minister is: doesn't she agree that when you have this kind of restriction, you in fact are going to discourage the very free speech and ultimately the free choice that the minister claims is the intent of this legislation?

Hon. S. Bond: I think there is a clear and simple route. I hope that we won't engage in a sense of creating fear and anxiety in small organizations. There is a very simple and clear route to knowing what you should or can do, and that is call Elections B.C. They outline all the time the kinds of things that are permissible, what the limits are.

We certainly don't want to preclude people from having their say. Let's take another example. If you have a farm and you want to check to see about…. You may know that there are rules and regulations about the use of pesticides, not a simple topic to sort out. There is a route you follow to get that information.

Yes, the speeding example is a simple one, because the sign is on the side of the road. But if you run an organization or if you are an individual, yes, sometimes you do have to do some additional homework.

Elections B.C. — their job is to ensure that when people dial up their number, they can outline simply and clearly for them what is acceptable, what is appropriate, and it's pretty straightforward. If you spend less than $150,000 and follow the process, you're going to be okay. I have every confidence that Elections B.C. would work professionally and very aggressively to make sure that people know what they can do to express their views.

L. Krog: I'm not going to skip ahead to section 84, which includes a new definition of "election advertising," but I'm going to read a piece of it just so I can try and drive home the point to the minister.

The existing section 228 says that election advertising means "the transmission to the public by any means, during the period beginning 60 days before a campaign period and ending at the end of the campaign period, of an
[ Page 12085 ]
advertising message that promotes or opposes, directly or indirectly, a registered political party or the election of a candidate, including an advertising message that takes a position on an issue with which a registered political party or candidate is associated, but does not include." Then it goes on to talk about "the publication without charge of news, an editorial," etc.

The proposed section 228, which is section 84…

Interjection.

L. Krog: …which we're not on, but I'm leading to a point here, Minister, so bear with me, please:

"'election advertising' means the transmission to the public by any means, during the pre-campaign period and the campaign period, of an advertising message that promotes or opposes, directly or indirectly, a registered political party or the election of a candidate, including an advertising message that takes a position on an issue with which a registered political party or candidate is associated, but does not include."

Then it goes on to repeat the sections.

There's not a great deal of difference here, but the language of the act as it exists and the language that's proposed talks about an "advertising message." I think, obviously, that clearly includes putting a leaflet out, taking out a half page in the Nanaimo Daily News that promotes or opposes, directly or indirectly, a registered political party, including an advertising message that takes a position on an issue with which a candidate is associated.

[1610]

If I'm the only candidate that is supporting the purchase of public lands, or private lands for a public purpose, and this nice group of dedicated volunteers in a neighbourhood — those folks who want to preserve the land, so the squirrels can survive and the birds can fly and the bees can buzz around…. If those well-meaning, local, caring individuals put out an advertisement that says, "We think you should vote for the candidate that supports the purchases of these private lands," that, I think, is covered by this act. It is an indirect promotion, I would suggest, potentially, of a candidate.

Now, you've got to be a smart enough voter to figure out which candidate supports this, but I would suggest, with great respect, that is exactly what this act will cover with respect to what we're talking about, which is section 80, which is the new definition of the pre-campaign period. I'd love to hear the minister's comments.

Hon. S. Bond: Just to be clear, the half-page ad in the Nanaimo paper either directly or indirectly supporting or opposing — yes, that would be covered.

We should just go back here for a minute. The wording "directly or indirectly" has actually been in the act since the 1990s — in fact 1995, we think — so the whole issue of indirect or direct is not new.

The definition was changed in 2008, and that came about as the result of a recommendation from the Chief Electoral Officer which arrived in 2006. The definition is pretty much verbatim of the federal election advertising definition, and other jurisdictions that use the same language include, obviously, the federal government, Alberta, New Brunswick, Nova Scotia and P.E.I. Our language is virtually the same as those other jurisdictions.

L. Krog: I appreciate that, and the minister makes a very timely point. But the difference here is in section 80…. Unlike those other jurisdictions, section 80 will extend that to 40 days prior to an election. That's where the rub is. That's my point.

It means those well-meaning people who may have limited funds — who are, frankly, pursuing what I think would arguably be a public good — are going to have to raise the money to determine whether or not they are falling within the section. I suggest to the minister that those kinds of groups, well-meaning groups, are simply going to withdraw from the process and, instead of giving profile in a public way to issues that should be of concern to voters, are simply going to stay away from public comment because they're terrified of falling under the Elections Act and being charged or, alternatively, will simply not be in a position to participate.

Hon. S. Bond: Well, first of all, I think one of the key points is…. We're going to keep coming back to this. In previous government iterations, the government would drop the writ as a surprise. What opportunity would that group that the member opposite has been talking about have had to say anything? They wouldn't have. There's a different dynamic at play. There is a fixed election date.

[1615]

Previously, if you wanted to talk about how you look at outcomes, the government held all the cards, dropped the writ. Those very individuals that the member opposite is rightly bringing to the House floor would have had zero opportunity, other than during the actual campaign period.

In our view, it is not an onerous process. They call Elections B.C. for free advice about what fits and what doesn't. When we get to section 84….

The member opposite sort of went, "etc., etc., etc.," to the other lists. For example, "the publication without charge of news, an editorial, an interview, a column, a letter, a debate, a speech or a commentary in a...periodical...radio or television program" — all of those things are not included. So to suggest there are no venues for comment is not correct.

To suggest that there is not an accessible way of determining how you can participate in the process…. It's very clear how you can do that.

The significant issue here is that those individuals with that voice that's so important and the small budget will actually get the same amount of consideration as the
[ Page 12086 ]
people who typically could spend millions of dollars. I think that's a pretty important principle, and that's what we're trying to reflect and capture in these changes.

K. Corrigan: My colleague from Nanaimo earlier talked about the problem for small groups, and the minister is just referring to small groups as well. What is the difference….? My understanding is that for British Columbia, those small groups need to register and go through that process, which is intimidating and takes time and is not easy. The minister talked about getting advice.

No matter how much money those small groups spend, even if it's zero, if it falls within the definition of pre-election advertising, those people have to register. That's where the barrier is.

Hon. S. Bond: You do have to register. I'm not allowed to use a prop, but there's a one-page form. It's an application for registration, and it includes information like your name of the organization, address of the applicant, city, town, e-mail, name of the principal officer, signature and the date the application is being sent out.

I don't want to diminish an argument or debate about access and intimidation, because it is important that people feel like they can participate in this process. That's precisely why we want to limit the amount of money that organizations and individuals can spend.

Do we not assume that that is a barrier — if you're the little agricultural organization that wants to put your $200 ad in the Prince George Citizen and you're up against a half-million-dollar advertising campaign? Where is the legitimacy in that? I am concerned about small groups that want to participate. I'm concerned about individuals being able to participate.

There's a long list of ways they can participate without registering. But if they want to have their say in a way that includes a fiscal argument and talk about issues that are important to them, there's a one-page form; there's Elections B.C. That, to me, while it may be challenging, is a lot less challenging than lining up your advertising against a campaign that's going to invest half a million dollars.

K. Corrigan: Is the minister aware of whether other jurisdictions in Canada have a floor that is the minimum amount that has to be spent in order to have to register? It's my understanding that there is.

[1620]

Hon. S. Bond: As you can imagine, there's variation across the provinces. Yes, there are floors in place. For example, in Quebec everyone must register and get prior permission, so you register anyway. The limit is $300, but everyone who participates has to actually register and get permission to participate in the process.

In Canada for federal advertising, you register if you're over $500, but all ads must identify the sponsor, regardless of whether registered or not.

There are a number of restrictions regarding that. Those are the ones that we have, in terms of, specifically, registration and spending limits.

K. Corrigan: My understanding is that Ontario, the federal government and several other provinces do have floors. It's also my understanding that in its 2010 report Elections B.C. recommended that there be a threshold. Is that the minister's understanding as well?

Hon. S. Bond: The member is correct. There was a recommendation in the report which was done in April of 2010 that talked about a potential $500 limit — a floor, as the member would have described it.

There's also thinking, and it's not captured in the report but in discussions, that without registration and without the identification of a sponsor, it's pretty hard for Elections B.C. to actually track and monitor. It was a balance between a registration process which is relatively simple…. I know that for some it will still be intimidating, but it's a one-page piece of paper.

In essence, there was that recommendation, cited in the report. There is also the concern, though, that is expressed in Quebec's management, for example, where you register anyway. Part of that is so that tracking sponsors and looking at those things are easier for Elections B.C.

K. Corrigan: It's not just the registration. My understanding is there's also reporting — is there not? What is the threshold for reporting of any spending?

Hon. S. Bond: The requirement for disclosure is at $500.

K. Corrigan: Now, my understanding is that there are several other provinces that do have a threshold, though. I'm wondering. The minister said that there was one, I think, in Ontario, Nova Scotia and Alberta, and there are some other ones. Is that correct?

Hon. S. Bond: I did indicate that there were others. I just cited the two that I had there.

[1625]

L. Krog: I appreciate the minister's comments. She did say we may agree to disagree. But one of the issues in the examples she raised is the advertisement in the Prince George Citizen. I think she said that someone can spend a half million dollars.

Isn't the minister concerned that in fact the effect of this legislation will be fairly simple — that powerful organizations and corporations, without limits on cor-
[ Page 12087 ]
porate and union donations, as examples, or limits on personal donations, will simply then funnel their money to a political party? Isn't that, in fact, going to be the result of this — that that's really what they are going to do? They are going to see, in the pre-election period, that they have no ability to spend money, so they'll simply pass it on to the political party.

With no limits on donations — individual, corporate or union — then surely the effect will be the same. Big money will still get to talk, and people of less wealth and power will be in the same position as they were prior to this legislation being passed.

Hon. S. Bond: I don't have that concern. Political parties have limits. In fact, what I would be more concerned about is that if we have limits on political parties, we don't have the ability to limit third-party participation. Political parties could then divert their funding and set up opportunities for third parties to actually pick up the balance of that kind of advertising.

I think the member has brought very thoughtful questions to the floor. The issue for me has been, fundamentally, balance. How do you find a way to ensure that there are ways for ordinary British Columbians — corporations, unions, whoever they are — to participate in the electoral process in a reasonable way, recognizing their constitutional rights?

We believe that the amendments that are being tabled reflect the concern that the court expressed. We have tried to address those, but we have tried to find that appropriate balance.

K. Corrigan: I wanted to bring to the attention of the minister…. Referring back to a question my colleague from Nanaimo asked several minutes ago about whether or not just reporting of donations would be sufficient, the minister said that no, she did not believe that that would be sufficient.

I would quote the former Premier, Gordon Campbell, who on April 17, 2006, was quoted in the Times Colonist as saying…. Sorry, this is a paraphrase, but the story says: "'As long as donations are reported publicly once a year,' he said, 'then people can make sure big donors aren't getting special access or favours.'"

I'm wondering if the minister agrees or disagrees with what the former Premier said.

Hon. S. Bond: I can't see the article, and there are two issues at play here in terms of the commentary about where donations come from and the ability to actually publicly report those. What I can say is that our concern here is the unrestricted ability of third parties to dominate the political discourse between elections, which are held with a fixed election date.

[1630]

As I said previously, in previous iterations of election calls, while we would express concern in this room about individuals who don't get a chance to participate…. Although the limit is $150,000, when there is not a fixed election date, the government drops the writ, and people don't have the opportunity to have discourse in the same way.

All we're suggesting is that there needs to be a reasonable balance between the time the House rises and the ability to discuss important issues, and doing that in the context of a fixed election date.

K. Corrigan: I'm wondering. Either when the original bill was brought in — the minister was not the minister at that point, I understand, but perhaps staff can answer this — or when these amendments were being made, as part of the analysis to determine the effectiveness of the earlier provisions or these provisions, did the minister consider the ability to, if these provisions were to be in place, control how election donations came in, in other ways? In other words, where would the water try to fall to?

Let's say a large organization, like a corporation, said: "Okay, well here are the new rules. How can we get around that?" We know nobody wants to break the law, but they may want to make donations in a different way. Was there analysis done of those large donors in the past, or large advertisers — of who would be most likely to get around the new law once it was in effect?

Hon. S. Bond: I can simply assure the member opposite that the ministry staff absolutely did no sort of analysis along those lines.

K. Corrigan: I made it very clear that I wasn't talking about anybody, suggesting they're breaking the law. I'll just come right out with it and tell you what I've heard people speculating.

The Chair: Through the Chair.

K. Corrigan: Through the Chair — absolutely, Madam Chair. Thank you for the reminder.

What speculation I have heard is that those that challenge the bill, which were essentially unions, have enough scrutiny and enough regulatory framework so that if this law were to come into place in either form, they would be severely limited in terms of free speech, but that on the other hand, corporations do not have the level of oversight and as strict a regulatory framework and that there would be other ways.

The example that was given to me is: what would stop a company from paying a bonus or a payment for whatever — $1,000 or $2,000 or $5,000 — to an individual and that individual then funnelling it into a campaign as an individual donation? I'm wondering if any analysis along that line was done and whether the minister thinks that there is a concern in that regard.
[ Page 12088 ]

Hon. S. Bond: No. That would be an offence under the Election Act. I would actually prefer to believe that whether you belong to a union or whether you belong to an organization or a corporation, the intent is for you to obey the law. What the member opposite described would be an offence under the Election Act, and it has always been an offence.

[1635]

K. Corrigan: I appreciate that it would be an offence under the Election Act, but if there was such a scheme set up — and I think 99 percent of British Columbians are good British Columbians who would do nothing along that line — would it be harder to discern that through a corporate framework? Or would it make any difference whether it was, for example, a union?

Hon. S. Bond: I have absolutely no idea whether that would be the case, and I won't even speculate. The people that would determine that would be Elections B.C.

L. Krog: With respect to section 80 in the general sense, the minister has committed today to ensuring that the…. Assuming this legislation is passed — I wouldn't want to be too negative, speaking for the opposition, but given that the government still had a majority the last time I did a head count, it's likely to pass — it begs the question: why not put this to the courts for review before going through the process of trying to pass it through the Legislature?

Hon. S. Bond: I understand the concerns expressed by the member. We want to ensure that we have the legislative framework in place and have the opportunity to have this discussion. But I think the fact that the reference is being made is an important thing.

I can't control the timing of the court in terms of how long that will take. Our team have already indicated to the court that this is on its way to them because we need to make sure that there is adequate time to notify the parties who were party to the previous appeal. So from our perspective, it's important to have the legislative framework to have the debate we're having today.

To the member's point, I haven't waited to not indicate to the court that this is coming. As the member knows better than I, scheduling the courts, finding the time to do these things, is critical. What is key to me is that the parties who were part of the appeal receive the appropriate notice.

[1640]

L. Krog: I guess my concern is this. This matter gets referred to the court. There's a decision. The parties to it aren't happy with it, whether that's government or whoever. It's under appeal. We go through another election with this being the law, potentially, and people being unsure as to whether or not….

Well, perhaps it's been struck down and we are waiting for the Court of Appeal to make a decision. If the court reviews it and says, "You can't do this," what's the situation then? Pardon me. I'm thinking here. It's a little late in the afternoon.

It goes to the Court of Appeal for the reference, then in theory it could go on to the Supreme Court of Canada. Perhaps the minister can correct me if I'm wrong. That'll be the first question.

Hon. S. Bond: You'd have to seek leave to have it referred to the Supreme Court. The member knows, as I do, that scheduling is not my purview. It's the purview of the court. I've been reminded of that on numerous occasions over the last little while.

As I said, I have already indicated to the court that this is coming and that we are having this debate and we are at this stage, in order to make sure that there is appropriate time to notify the parties. That's important. And I think there is something to be said for that.

We aren't simply tabling this and then waiting for people to react to it. We're saying in advance that we understand the concerns that have been expressed through the last appeal process, so we will take this to the court and we will encourage and invite the parties. The court will make them aware of that, and they will have every opportunity.

I can't speculate on the timing, but I'm appreciative that we're having this debate today. In listening to the member last week, I understood his concern about needing the court to look at this. I've already indicated to the court that this is coming, that this debate is taking place, and I know that scheduling will be already something that the court is considering.

L. Krog: I appreciate the minister's comments, and I appreciate her earlier commitment that this would in fact be referred to the court. I fully accept her commitment. I'm wondering if she is prepared to make a commitment likewise that….

Assume for a moment that this court process leads to a decision that is favourable to the government and leave to appeal is sought and it hasn't been determined yet whether leave will be granted. What's the government's timetable, and/or will the minister make a commitment that this legislation, this particular aspect of Bill 41, will in fact not be proclaimed until after the court has made its ruling?

Hon. S. Bond: I'm not going to preclude. I'm not going to speculate today about where we will end up. I did, as I said, listen carefully to the member's comments and have in fact already indicated to the court that this is being referred to them for scheduling. I'm doing that in the hopes that a timely process will ensue that is fair to the
[ Page 12089 ]
parties. They will be contacted in due course by the court.

I'm not going to predict where we're going to end up. I think the member opposite can understand that. Government needs to contemplate what outcomes might eventually occur. But you know, I am hopeful and optimistic that this will meet the test of the courts and that we will see this dealt with in a timely way.

L. Krog: Again, my very specific question is: assuming this is still before the courts, for whatever reason, is the government prepared to commit to not proclaiming the legislation until the court has determined its constitutionality?

[1645]

Hon. S. Bond: We believe this is good policy. We believe that the work that we've done will meet the test of the courts. We believe that we will be successful, and if we are successful in the Court of Appeal, we certainly would proceed.

K. Corrigan: We were speaking earlier about the impact of section 80 — and the act generally but this pre-election period, which is what we're talking about with section 80 — on small organizations. I just want to read a little bit from an article that was a special to the Sun by Vincent Gogolek of the B.C. Freedom of Information and Privacy Association, Shannon Daub of the Canadian Centre for Policy Alternatives and Micheal Vonn of the B.C. Civil Liberties Association, who on May 7, 2012, said, among other things:

"Research we conducted with social movement groups after the 2009 provincial election found the prospect of being publicly labelled as a third-party advertising sponsor created anxiety for many non-profits, charities and other organizations that are careful to remain non-partisan, with some simply choosing to opt out of public engagement during the election entirely.

"One in four of the groups that participated in our study self-censored as a result of the rules. Six groups censored public communication activities specifically to avoid having to register as advertising sponsors. Others self-censored due to confusion and/or concerns about the risks of inadvertently breaking the rules.

"Most of the activities groups censored had little to do with commercial advertising. For example, nine groups did not post new material on their websites, four removed existing material from their websites, and four refrained from issuing or endorsing a call for changes to government policy.

"Particularly troubling is the revelation that five groups avoided commenting in the mainstream media due to confusion about the rules. Media commentary is one of the few exemptions, of course, from the definition of advertising."

One other section from this:

"Without a minimum threshold, in practice B.C.'s rules focus mainly on these small spenders. Of the 232 organizations registered as third-party sponsors during the 2009 B.C. election, more than half — 59 percent — spent less than $500 and three-quarters spent less than $3,000."

I just wanted to read that into the record to demonstrate that there was a chilling effect on small organizations because of the pre-election spending advertising rules that will again be reinstated for a shorter period of time.

Hon. S. Bond: I think we have actually had a requirement for election advertisers to register with Elections B.C. since 1995. It doesn't matter how much they spend. So I think we have to remember — and we've said this throughout the course of the discussion, and it's been thoughtful — that these rules are not in place to prevent average citizens from having their say. What we do know is that the requirement to register guarantees a degree of transparency.

One of the things we also can recognize is that in the Internet age, for example, you can do a fair bit of advertising for a relatively low monetary investment. So there are lots of ways. When we get to section 84, we can go over the long list of ways that people can actually have their say.

I think the member's point…. What I think it calls on all of us to do is make sure the Chief Electoral Officer ensures that there is a vigorous information and education process, where people are given the opportunity to understand that it's a one-page document, and you register so that people can actually know who the sponsor of whatever degree of advertising that is.

[1650]

I think that's a place where both sides of the House can work together to ensure that we are being very clear about our support for people having their say and that the Chief Electoral Officer's job is to provide the kinds of information that remove barriers or concerns that the gentleman — I believe it's a gentleman — in the article has written about.

The Chair: Shall section 80 pass?

L. Krog: Nay. Division.

The Chair: Division has been called. Pursuant to an agreement between the House Leaders, this division will be deferred and taken in the House later today.

On section 81.

L. Krog: I wonder if the minister could explain the effect of section 81.

Hon. S. Bond: The significance here is that the changes would use the standard definition for the act. It again shortens the pre-campaign period from 60 days to a maximum of 40 days. It also ensures that the rules respecting election expenses for political parties, candidates, constituency associations apply for the same period of time as the advertising limits apply to third parties.

L. Krog: Just to confirm, then, as this takes us back to
[ Page 12090 ]
the pre-campaign period. The campaign period is the 28 days of the campaign. The pre-campaign period — I will call it the moving target.

Hon. S. Bond: Sliding scale.

L. Krog: Sliding scale, the minister suggests. I think I like her definition better — the sliding scale, which was discussed previously with respect to section 80. In other words, it can be something substantially shorter than 40 days, potentially, and it could be, in theory, somewhat longer.

Hon. S. Bond: It can't be longer. It would only potentially be shorter, again depending upon the rising of the House — the date of that — the 21-day buffer period built in and then a maximum of 40 days. An important principle that, in thinking about it, I thought was critical was the ability to…. If the House has issues and they stay longer, the 40-day period shrinks.

Section 81 approved.

On section 82.

L. Krog: If the minister could explain the effect of section 82 as well.

Hon. S. Bond: We use the standard definition for the act. It ensures the pre-campaign period is a maximum of 40 days. Again, rules respecting election expenses, constituency associations and political parties apply for the same period of time as advertising spending limits.

L. Krog: If the minister could just confirm, with respect to sections 198(1)(a) and 199(1)(a) being amended by this. Those sections relate to what aspects of the Election Act?

Hon. S. Bond: They relate to election expenses limit for registered political parties in 198, and 199 is election expenses limit for candidates. The amounts contained do not change.

[1655]

L. Krog: Just to confirm. That in fact is, for a political party, an amount not exceeding $4.4 million, as I understand it.

Hon. S. Bond: The amount would be $1.1 million during the pre-campaign period, and during the campaign period that number would be correct, at $4.4 million. Those are not new amounts. Those remain the same.

L. Krog: Just to confirm, then. Again, the number, so to speak, each time will have to be determined with respect to section 198(1) and 199(1). In other words, we're going to have to look at the date of the rising of the House to determine whether or not the $1.1 million allowed during that period is in fact allowed and over what period of time it's going to be allowed.

Hon. S. Bond: The member opposite is correct. It would be during that sliding scale period of time, so a maximum of 40 days. That would be the amount that would be allowed to be spent, the $1.1 million, during that period of time. The Chief Electoral Officer, Elections B.C., would be monitoring those expenses.

L. Krog: In terms of monitoring those expenses, how are they, in a practical way, monitored?

Hon. S. Bond: That process would not change. It would be through disclosure reports — the similar process that there is in place today.

L. Krog: For practical purposes, then, there are no investigatory steps undertaken. In other words, it's not like…. Apart from the audit of the disclosure statements, there is no other mechanism presently employed by the Chief Electoral Officer to determine whether or not those limits are being met.

Hon. S. Bond: To the member opposite's question, there are residual powers of investigation, but that is outside the scope of this amendment. The Chief Electoral Officer does have residual powers, but the typical process would be disclosure, as it is today.

Section 82 approved.

On section 83.

L. Krog: If the minister can just explain the effect of section 83.

Hon. S. Bond: Not a significant change. It does refer to the standard definition of "pre-campaign period." What it does is require the CEO to establish the limits at the start of whatever that pre-campaign period would be, whether it's 40 days or sliding to a different day. The time right now that's in the existing provision would be 60 days prior to the start of the campaign period. This simply modifies this to reflect that the CEO has to change that depending upon the…. The change would be reflected on the date where the pre-campaign period starts.

[1700]

Section 83 approved.

On section 84.
[ Page 12091 ]

L. Krog: Section 84 is the provision relating to election advertising, which was the subject, if you will, of the court decision. I wonder if the minister can explain the difference between section 228 as it exists and the new proposed section 228 set out in section 84.

Hon. S. Bond: The only change is adding the phrase "during the pre-campaign period and the campaign period." That is the only change in section 228.

L. Krog: So that's the only change. Can the minister explain, then, what the actual effect of this change will be, vis-à-vis election practice?

Hon. S. Bond: While there was only that change, I understand the member opposite's question: why are we repealing an entire section and putting in this section then? In fact when the Supreme Court ruled, which was then upheld by the Court of Appeal, this section is of no force, because it relates to the pre-campaign period. We wanted to be sure there was absolutely no ambiguity regarding the section's status following the court rulings. What we did was re-enact the entire section with the amended text.

L. Krog: If I may confirm, did the court, in striking down this section, strike down this section because of the application of the petitioners, if you will, related to the entire section, or did the court in its reasons indicate it was specifically aimed at a portion of section 228 which it found offensive?

Hon. S. Bond: It didn't strike down the entire section. It struck down the definition of election advertising as it related to the pre-campaign period. In order to provide clarity and avoid ambiguity, our view was to repeal and substitute.

L. Krog: I think I have the minister's point around this.

With respect to section 228 as proposed, though, and looking back at section 228 as it exists, is there any case law around the issue of what constitutes "an advertising message that promotes or opposes, directly or indirectly"?

[1705]

[D. Horne in the chair.]

Hon. S. Bond: There was, I'm told and advised, argument about the breadth of the definition at the Supreme Court. But the section itself, the definition, was not struck down. What was the court's concern was the definition as it applied to the time period — the span of time, in particular the focus on the legislative period.

L. Krog: I appreciate that the section itself was struck down, and the concern was around the timing. But I'm wondering: was the court in fact asked by the applicants, if you will, the plaintiffs, respondents in the appeal — namely the B.C. Teachers Federation, Federation of Post-Secondary Educators of British Columbia, etc...? Was the court in fact asked by way of the claim to deal specifically with those definitions or those words, or was it just an application to strike down the whole section? In other words, I'm looking for something more specific.

Hon. S. Bond: I am advised that the plaintiffs did argue that the text was too broad, but the court did not find the language to be overly broad. That would have been based on a decision that was previously upheld in the Supreme Court of Canada in 2004, around this text.

L. Krog: Just so I can be clear from the minister, with respect to section 228 as it then was, the court considered very specifically the language of the section, and it came to a specific conclusion that directly and indirectly it was not, in and of itself, offensive in any way.

[1710]

Hon. S. Bond: These are actual quotes from the actual court case, and I quote from Mr. Justice Cole: "As the court noted in Harper, third-party advertising can directly support a particular candidate or political party. It can also indirectly support a candidate or political party by taking a position on an issue associated with that candidate or political party." Then there are several sentences in between, but the summary is: "In my view, it does not cause the impugned definition to differ materially from the federal definition in that respect." That would have been the reference to being upheld. "Any case for overbreadth must therefore rest upon the expanded duration of the restricted period."

L. Krog: I take it that what the judge was saying is he agreed with the decision of the Supreme Court of Canada. Is that something other than the Harper decision?

Hon. S. Bond: I'm advised that would be the Harper decision.

L. Krog: Again, with respect to the order of the court, which is confirmed by the Court of Appeal, were there any specific comments in the Court of Appeal decision that related back to Justice Cole's decision?

In other words, was there any further commentary or further direction from the court around the breadth of that definition, taking into account or commenting on the fact that we weren't talking about the election period; we were talking about the pre-election period?

Hon. S. Bond: Staff will continue to look through the actual transcript, but not that springs to mind.
[ Page 12092 ]

L. Krog: Now, dealing with section 84, the new proposed section 228, I'm wondering if the minister can advise what case law, if any, relates to the term "contribution," and it talks about a contribution of money — any definitions that have expanded or dealt with that particular provision.

Hon. S. Bond: That would be outside the scope of the act and the changes. The definition of "contribution" would continue to be as it has been in the past.

L. Krog: Just to confirm also with respect to the provision "election advertising." Apart from the change that relates to the pre-election period, there is no definitional change whatsoever between section 228 as it exists and section 228 as proposed in section 84.

Hon. S. Bond: That's correct.

L. Krog: With respect to the election period, during the questioning around section 80 earlier today the minister made reference to other jurisdictions that have this kind of restriction on pre-election advertising. Can the minister assist in advising whether or not their election advertising definitions are in fact similar to those that are in either our federal act, which has been the subject of judicial consideration impacting on the court decision in this case, or indeed similar to the provincial legislation as it has existed?

[1715]

Hon. S. Bond: We don't have that detailed information with us, but certainly, the staff and I would be happy to try to provide that for the member.

The Chair: Shall section 84 pass?

A Voice: Division.

The Chair: Pursuant to an agreement between the House Leaders, this division will be deferred and taken in the House later today.

On section 85.

L. Krog: With respect to section 85, again, the whole section is repealed. Is this because of the same reasoning that the minister advised of earlier with respect to section 228 as set out in 84? In other words, rather than fiddle with it and face further challenges, it was easier to repeal the whole section, notwithstanding how narrow the court's concern was with respect to section 235.1.

Hon. S. Bond: That's exactly correct.

L. Krog: Can the minister advise…? With respect to section 235.1 as it existed, which was the subject of the court decision, were there any specific comments about that section relating to portions of it as opposed to a general commentary on this section? In other words, what did the court specifically get at when it referred to 235.1?

Hon. S. Bond: There were arguments about the spending limits, about the time they apply and, certainly, the definition of election advertising. But the court did uphold the limits so far as they related to the campaign period itself.

L. Krog: Just to confirm, did the court…? The minister said, I think, that with respect to the campaign period, the court had no problem, but with respect to the pre-campaign period, they felt the limits were unjustified in terms of a monetary amount. Is that fair?

Hon. S. Bond: No, and I'm sorry. As soon as I sat down, I knew that wasn't a clear answer. All of the provisions were upheld during the campaign period, and the concern the courts had were related to the items that I mentioned previously — in particular, the definition of advertising relating to the time and the overlap, in particular, with the Legislature.

L. Krog: Just so I'm clear, the court struck down the section, but only because it related to the pre-campaign period, not because it related to the campaign period at all.

Hon. S. Bond: That's correct. The court said that it does not apply and that it has no force or effect, so long as it applies to the campaign period.

L. Krog: To confirm, apart from the change where it talks about the pre-campaign period, is there any other language change between section 235.1 as it exists now in the statute versus 235.1 as proposed in section 85?

[1720]

Hon. S. Bond: There's none.

The Chair: Shall section 85 pass?

A Voice: Division.

The Chair: Pursuant to an agreement between the House Leaders, this division will be deferred and taken in the House later today.

On section 86.

L. Krog: Again, if the minister could simply explain the effect of section 86.
[ Page 12093 ]

Hon. S. Bond: It uses the standard definition for the act and shortens the pre-campaign period from 60 days to a maximum of 40.

L. Krog: I take it there's no change. That section relates to "Independent sponsors must file disclosure reports." So an independent sponsor would be — if the minister will bear with me — a person "who is not a representative of a political party," etc. It talks about "independent" in the definition section. Who is an independent sponsor?

Hon. S. Bond: The definition would be anyone that is not a candidate or a political party.

Section 86 approved.

On section 87.

L. Krog: With respect to section 87, if the minister can just explain the effect of this section.

Hon. S. Bond: This would allow the Chief Electoral Officer to file a certificate in relation to a third party that has exceeded its election expense limits, and it would also assist in enforcing the election expense limits as they apply to third parties.

L. Krog: Just to confirm, this repeals and replaces…. Is there any other language difference between section 278(1) as it exists and the new proposed section, or is it just simply, as the explanatory note indicates, the addition of section 235.2?

Hon. S. Bond: The member is correct.

Section 87 approved.

On section 88.

L. Krog: Not having the time to take, we're going to have a quick look. What's the Family Law Act got to do with the Election Act? I'm just curious to know.

Hon. S. Bond: This a consequential amendment. Because we're making these changes related to the definition of "spouse" — in particular, that it refers to in the Family Law Act — what we want to do is just make sure that it points to the right act. If we don't change the…. There is a new definition of the pre-campaign period. It includes a certainty provision in the newly created sub 1(2). This requires renumbering of all the definitions within a newly created sub 1(1). What we have to do is make sure that…. This is a consequential amendment that points to the right section of the Family Law Act.

L. Krog: I wish the member for Cowichan Valley were here to use the term "jiggery-pokery" again. I'm being amusing when I say that. I take it that this is strictly a numbering thing. That's all. And yet it relates back to the Family Law Act.

[1725]

Hon. S. Bond: Okay. Obviously, the second half of my answer was better than the first half. To be clear, it is a numbering issue. It is a consequential change that's required, so it is strictly.... No jiggery-pokery, I can assure the member opposite. It's harder to explain than many of the other sections, but it's consequential, and it's a numbering issue.

Section 88 approved.

On section 89.

K. Corrigan: Not too long ago we were dealing with legislation changes to the Police Act as a result of the creation of the independent investigation office. Now we have some amendments, and I'm looking forward to going through them with the minister.

I have looked at old section 38.06, which deals with independent investigations office staff and investigators, and compared it with the amendment that we have here under section 89 of this act. I'm wondering…. I've looked at the two, and I can't quite see what the difference is. There are some ordering differences, but maybe it could be explained to me what problem there was there that needed to be addressed.

Hon. S. Bond: This is a matter of clarifying that the chief civilian director can appoint former members of a B.C. police force, provided they have not served as a member of a B.C. police force within the last five years preceding their appointment.

There were concerns that there wasn't enough specificity. This is not a policy change. It's a matter of clarifying what is a critical principle of the hiring of investigators for this office.

K. Corrigan: I'm just wondering if you could drill down a little bit on that. What part was unclear in terms of who could or couldn't be hired? It looks to me like it's the same. I'm just trying to figure out what part was not clear, maybe just specifically.

[1730]

Hon. S. Bond: The change — the word — may be appear to be simple, but it's a really a critical one in terms of moving forward.

The word used previously would have been "civilians" with investigative experience. The concern was that the definition didn't explicitly include municipal police officers. But they needed to be captured, and they're not
[ Page 12094 ]
civilian. So by changing the word to "person," what it does is it covers off. Because as the member opposite can see, there are other ways of describing police officers in the previous section.

This now clarifies that it is "persons," and it would be inclusive, clearly, of municipal police officers, with the same parameters that they had not served for five years previously in the province. That was the concern.

K. Corrigan: That does make sense. I have met recently with the chief civilian director, and I know they're in the hiring process. So did this come up as an issue during the hiring process — that there was a feeling that those individuals might not be allowed to be hired?

Hon. S. Bond: I was very privileged to be able to choose the chief civilian director. He's exceptional, and I think British Columbians will be very proud, I'm confident.

In reviewing the act explicitly, the concern of the chief civilian director was that he wanted to be absolutely within the legal framework — that the hiring fell within that. In fact, he reviewed the act and expressed concern about the fact that it may preclude municipal officers. It did not impede his hiring practices, but he wanted to be sure that there was clarity within the act that made it very clear that municipal officers who fit the criteria would certainly be candidates for working in the independent investigation office.

K. Corrigan: So the chief civilian director, then, was hiring people and may have felt constrained but did go ahead and hire, possibly, municipal police officers as long as they had not served recently. Is that correct?

Hon. S. Bond: I'm not privy to the backgrounds of the individuals that have been hired. We were assured that it did not hinder his hiring, but with an abundance of caution, he wanted to be sure that the legal framework was correctly in place. I'm certainly told that hiring is going very well. We expect to have the office up and running mid-summer, which is when we had anticipated. But we were assured that it did not impede his hiring.

K. Corrigan: Probably a final question in this section. From the minister's perspective, the intent in the old wording is consistent with the intent in the new wording, and the same rules are expected to be applied. It's just a matter of wording, essentially, then?

[1735]

Hon. S. Bond: That's correct. There is no policy change. It's a matter of just being abundantly clear and cautious so that as we move forward with this organization, there is no concern about who can be hired.

Section 89 approved.

On section 90.

K. Corrigan: This is a new section which deals with officers being required to cooperate with the independent investigations office. It says: "An officer must cooperate fully with (a) the chief civilian director in the chief civilian director's exercise of powers or performance of duties under this Act, and (b) an IIO investigator in the IIO investigator's exercise of powers or performance of duties under this Act." I'm wondering why this change has been made — or addition.

Hon. S. Bond: This is a new section, and again, it is related to the discussion that we've had with all of the parties, including police, the independent investigation office. In our initial work the assumption was made — and we would continue to have that assumption and expectation — that there would be a duty to cooperate.

When the new chief civilian director was hired and asked to review the legislative mandate, we asked that he look across the country for best practice at all of the expectations for police officers. What this builds in is assurance, I guess — the requirement for there to be a duty to cooperate.

You know, we very much believe that this is an important, new principle, independent investigation in the province, and what is critical is that during an investigation there must be a duty to cooperate. The police officers will be required to provide statements, for example.

So again, this is about having the chief civilian director look at the act, look at best practice, come back to us after discussion with all of the partners and make a recommendation that it be very clear and explicitly laid out that there is a duty to cooperate.

K. Corrigan: I have been in some really interesting discussions with police officers, both municipal and RCMP officers, as well as speaking to the civilian head of the new independent investigation office. It is going to be a very interesting rollout of this act, and we're supportive of it. We're highly supportive of it.

There are some pieces, when it was being put together, that we had concerns about, but overall, we're very supportive of this independent investigations office. But one of the really interesting things is going to be to see how it is that this new office fits into the existing law enforcement scheme.

[1740]

There are going to be all sorts of situations where the authority of the independent investigation office is really going to be put to the test. So I appreciate this section going in there, but I'm wondering if it's expected that there will be.…

There will be much more detailed protocols, I would
[ Page 12095 ]
assume. I know they're being developed now, about what the requirements are for sequestering officers and so on. I'm just wondering: is it expected that there will be further regulation in that regard, or would those be just operations manuals? What is the expectation?

Hon. S. Bond: I do appreciate the member's — both of the critics opposite — support for the work that's been done here. Again, all of these changes, I believe, have been vetted by Commissioner Braidwood in terms of the adjustments, because obviously, his recommendations led to this work. I met with him on a number of occasions to make sure we got it right.

The member is correct. The chief civilian director is currently working through extensive consultation with all of the partner groups, and he is finalizing those consultations. At the end of that there will be a very specific, agreed-upon protocol.

Again, I have to say, first of all, how impressed I am with the degree of cooperation and support that we've received from police organizations. Certainly, in talking to the new deputy commissioner of the RCMP…. As he reminded me, they've been asking for civilian oversight in our province. So there has been a very collaborative, constructive process here.

These changes reflect three principles: one that we've discussed, the general duty to cooperate, which is important; agreed-upon protocols, which are being established by the chief civilian director; and the final piece is also later in the amendments, and that would be the possibility for the director to actually create standards as well. So if we find that there are gaps that exist in the protocol, these amendments would allow the director to deal with those issues as well.

The member opposite has described it correctly. The fact is there is much consultation going on because we do need a well-established protocol so that everyone understands how this will operate. I can't say enough about the cooperation we've received from municipal and RCMP leaders in the province.

K. Corrigan: The protocols that are being developed — the minister has said there's a lot of consultation going on, and I believe that. Is that consultation going along…? Is that including the police, essentially, unions, I guess, the associations — the B.C. Police Association as well as the chiefs and the other representative organizations?

Hon. S. Bond: The answer is yes. There is much discussion going on. It does include the police union. I think that Tom Stamatakis certainly has had a great deal of involvement in this process.

[1745]

One of the things that I think will be a significant statement about this…. You know, they're working together, collaboratively, to agree upon the protocol. I very much appreciate the way the chief civilian director has engaged and has found consensus on the vast majority of items. I believe there are some other, additional items that are being finalized as we speak. Generally, an excellent consultation, well-done work by the chief civilian director and, yes, including the police union.

Mr. Chair, if I might. I should have introduced my staff, because they changed on this topic. I'm pleased to be joined by Clayton Pecknold and Jeremy Wood.

K. Corrigan: So that included RCMP — and representation from municipal police forces, the organization? Or going to the individual municipal police forces?

Hon. S. Bond: I don't have an explicit list. I don't believe it would be accurate to say they went to every specific police detachment or unit. So in essence, it's a representative group that would include the RCMP, municipal police forces and also the police union.

K. Corrigan: Are there any groups or organizations, since the act has been brought into place and while these discussions have been going on between the chief civilian director and various organizations, that have…? Is the minister or staff aware of any organizations that have expressed concern with not the original concept but the rollout and how this protocol and other implementation are being put into place?

Hon. S. Bond: Certainly, not that we are aware of and not that I'm specifically aware of. I should also comment, though, that the chief civilian director is independent and in fact I wouldn't be aware of all of the details.

He has an independent role, and that's incredibly important to this concept. I'm aware generally of the process that's been undertaken and, generally speaking, about the status of where we are at, but I don't know the specifics. He is an independent chief civilian director.

K. Corrigan: Just a last kind of general question on this section. Was it felt, in requiring this section to be added to the act — to be very clear of the duty to cooperate — that there was also a legal side to that? Perhaps it was necessary for legal reasons, other than just the spirit of the thing, to put this in place?

[1750]

Hon. S. Bond: I think the best way to answer that question is that it hasn't been added to fix a legal issue. It's not that there was an issue. I think that what this does is it does create a legal change. Now officers will be legally required to cooperate.

There wasn't a problem, but I think there is…. Again, as the chief civilian director reviewed the act, he very clearly wanted and requested the certainty that there would be a duty to cooperate.
[ Page 12096 ]

This is an expectation that is above and beyond what one would expect of an ordinary citizen like myself. We have decisions to make about that. In this case an officer would not have that option. They would be required now by law to provide statements, for example.

So not fixing a legal problem but certainly something that the chief civilian director indicated to us would be an important protection — that we would have that as a legal requirement.

K. Corrigan: What does this mean in terms of…? For example, there is an incident. Let's say there's a really serious incident. There's a shooting. The officer then immediately says…. The IIO is called in. Officers arrive to investigate. Say it's in the Lower Mainland, so it would be close and quick. Then the officer says: "I have the right to a lawyer. I'm not going to say anything until I have consulted a lawyer." How would that jell with this?

Hon. S. Bond: A very important distinction, so I appreciate the question. If there is potential criminal liability or if during the investigation or as the investigation occurs, there is a belief that an officer is potentially criminally liable, they retain all of the legal rights they have under the Charter. So yes, they would be able to have a lawyer, and they would go through that process.

This refers to witnesses. Again, the investigation determines that if anyone is potentially subject to criminal liability, there would be a circumstance where they would require a lawyer in order to protect their rights. This is about a statement or an interview of a witness officer, that they will be required to provide that statement in a timely and appropriate way.

K. Corrigan: It has been a while since I've seen the original definitions in the act. I don't think I brought…. I've got the Police Act with me, not the amendments that we dealt with last time.

The definition of "officer" — does it make it clear that we're talking about witnesses as opposed to the individual who may be being investigated?

[1755]

Hon. S. Bond: The definition of "officer" doesn't make that distinction. Obviously, one of the things that…. The protocol that's being worked on currently will clearly address that as well. Obviously, just under the general principles of law and criminal jeopardy, anyone who is in that position would be allowed to have legal counsel.

So the protocol will address it. The definition does not. Again, it's the independent investigation office that will determine, when they take over that investigation, whether or not the individuals involved have any criminal liability.

K. Corrigan: I appreciate that it'll be in the protocol, but I'm a little concerned. You say it's going to be in the protocol that's being developed. It is the chief civilian director who will determine…. I'm just wondering, if we're talking about witnesses and we're not talking about the officer who is subject to the investigation, why that would not have been clear in the act.

Hon. S. Bond: Because constitutional law or the Charter trumps these provisions. There is always the protection of one's legal rights if they face criminal liability.

K. Corrigan: Yes, I appreciate that, but I'm wondering if there is any concern, because the minister has said this applies to witnesses, that there could be a misinterpretation, either by an individual police officer or by anybody reading this act, that in fact it imposes some obligation, which can be trumped by the Charter, on that officer who is being investigated to cooperate fully. There's nothing the matter with that, but I'm a little troubled by it.

Hon. S. Bond: The independent investigations office would make a determination about whether or not there was criminal liability. Certainly, in the view of the drafters and others, there was no need to make that distinction, because once the IIO determines that any of the officers that were involved have criminal liability, the Charter trumps any other expectations. That's just constitutional law.

The drafters did not believe there was a concern. There was no need to define in advance, because the IIO will look, determine, and if there is someone who they believe has criminal liability, immediately they would have Charter rights.

K. Corrigan: Of course, we always have Charter rights. They are there as we walk through life. They guard us as we walk through life at all times.

I guess, just to tie this down: is the minister saying, then, that this section does not apply to somebody who potentially will have criminal charges or a criminal investigation?

[1800]

Hon. S. Bond: In fact, the independent investigations office is not going to compel a statement from a subject officer — in other words, someone who has been determined to have a potential criminal liability. That would be inadmissible because the Charter, obviously, protects their right to have legal representation. There is no need — certainly, from the drafters perspective — to define a principle that is enshrined in constitutional law.

The IIO would simply identify that officer as a subject officer, not a witness officer. That happens in policing all the time. That subject officer would immediately claim Charter rights. The witness officers, however, would be compelled to cooperate.
[ Page 12097 ]

K. Corrigan: The minister was saying earlier that Thomas Braidwood had approved of these changes. Was this issue that I've raised — the application of this section and who it applies to — discussed with anybody, with either Braidwood or any of the other stakeholders that have been consulted in the development of these sections?

Hon. S. Bond: Yes, there was extensive consultation, in fact. I should describe to you the process with Mr. Braidwood so that it's clear. We went to Commissioner Braidwood's policy adviser, who then went to Commissioner Braidwood, who then got back to us to say, yes, he agreed.

But there was discussion about the entire act line by line, I'm told, with the chiefs of police, B.C. Civil Liberties, the police association, the Office of the Police Complaint Commissioner, the Privacy Commissioner, the Union of B.C. Municipalities. There are probably others, but that's a pretty extensive list of who we discussed the act with.

K. Corrigan: On this specific issue that I have raised, whether or not this would in any way apply to the subject officer, as it's been described to me…. This issue that I have raised about the application of this section to the subject officer has not been raised? It's not a concern raised by anybody else?

Hon. S. Bond: I am advised that would be correct. There were no specific concerns raised about that issue.

K. Corrigan: I'd forgotten that there are a whole bunch more pieces, and I was thinking we're just talking about that very small subsection, 38.101. I have numerous other questions with regard to section 90.

Going on to section 38.102, which deals with the use of statements made by officers, subsection (1) says: "A statement provided or an answer given by an officer during an investigation under this Part is inadmissible in evidence in court in a civil proceeding for remedies against the officer in relation to the matter under investigation."

I'm wondering if the minister can explain. Is this true in other types of investigations? Previously, is this the history with investigations against police officers?

[1805]

Hon. S. Bond: There is a very similar provision in the Police Act, part 11, which deals with the police complaint process. This is certainly something, I am advised, that the police union, for example, would be very supportive of.

What this does is when you compel an officer to provide a statement…. If I were asked, I would have the ability to actually say: "No, I'm not going to do that." In this case we are compelling police officers, witness officers, to provide a statement, and they need to have some degree of protection. Obviously, they will then be compelled to give the statement, and it will not be able to be used in future actions. It really is an important protection for witness officers.

K. Corrigan: Now, I think I have the section of the Police Act. It may or may not be, because I haven't gone through it all. Is it section 102(1) of the Police Act that is similar?

Hon. S. Bond: The section would be 102(1).

K. Corrigan: The wording is different, but is the operation the same?

Hon. S. Bond: The intent would be the same.

K. Corrigan: Just for the sake of clarity, I'm wondering why different wording would be used, which, of course, could be subject to legal interpretation, and different legal interpretation, so you would have a different operation. When we have important cases before the law, every word will be parsed.

I'm wondering why it was decided that we would use a different description in this section as opposed to presently under the Police Act.

[1810]

Hon. S. Bond: As I said earlier, the intent is the same. The context is different. When you look at, related to the police complaint section…. It is related to conduct and discipline, basically an administrative process — a different context in terms of the independent investigations office.

This is a criminal investigation, so we took the best advice of drafters and legal advice to ensure that the context was clearly articulated. The intent is the same. It provides a degree of protection for a witness officer in the criminal context.

K. Corrigan: Prior to this act serious cases were investigated by different departments somewhere else in the province, or whatever. Would this provision apply in present investigations? Would that be consistent with the way things operate now?

Hon. S. Bond: No, this would not exist today. These are powers of the independent investigations office, so this would relate directly to that office.

K. Corrigan: I'm not quite clear, though. This would relate to that office, but what I'm asking is that if there was a serious incident under the regime that we're operating now that has other police departments investigating, and someone was to make a statement during that investigation, would it or would it not be admissible in evidence
[ Page 12098 ]
in court "in a civil proceeding for remedies against the officer in relation to the matter under investigation"?

Hon. S. Bond: This is a new provision, and it is attached to the new independent investigations office, so that would not occur at the present time.

K. Corrigan: Well, this is very significant, then. I mean, it's a real change to suggest that statements that are made in an investigation would not be admissible in a civil proceeding. What was the reason for making this change?

Hon. S. Bond: The difference would be that currently they can't be compelled to provide a witness statement or an interview. Under the independent investigations office a witness officer will not have that choice, as I said, unless there is criminal liability that is potential. Then, of course, they have all of the appropriate legal rights.

In fact, you now will be required and compelled to cooperate with the new independent investigations office. Again, I think it builds on the foundational principle that this will be an independent investigation, and all of the appropriate powers will be provided to the chief civilian director, including the ability now to compel witness officers to provide statements.

K. Corrigan: It again points back to the confusion about what it is you mean by an officer. I assume that it could be either the person who was the subject officer, as it's been described to me, or a witness. It is a little bit confusing to have that definition covering both of those areas.

I'm wondering if this particular section was canvassed with B.C. Civil Liberties or other organizations.

Hon. S. Bond: Yes, it's the same list of names that I gave the member opposite, including B.C. Civil Liberties, the Office of the Police Complaint Commissioner, the Union of B.C. Municipalities, police unions. All of that, the entire list, was provided with the act, and we were very transparent about the changes that needed to be made.

[1815]

I obviously could not sit in on all of those meetings, but I am advised that there is no specific concern expressed about this issue.

K. Corrigan: Frankly, I find it a little bit surprising. Was there any thought that perhaps this particular section could be challengeable under the Charter?

Hon. S. Bond: Again, I'm advised there were no specific constitutional concerns raised — lengthy consultation, very inclusive in the process. It is a balance. It's if you were going to compel someone to do something, then you need to balance that with protection as well. It has gone through appropriate constitutional legal review, legal advice and significant consultation.

Again, as I said to the member opposite, there is a distinction. If someone is facing criminal liability, which the IIO will determine when they take over that investigation, that immediately triggers their ability to have legal support, legal advice and all of the legal rights guaranteed to them under the constitution.

K. Corrigan: Well, I'm glad it's gone through all of that review. I'm a little surprised. I can imagine that lawyers, for those that may want to bring civil proceedings, may be concerned about that. But if the trial lawyers and so on were included…? Just check that. Was the Trial Lawyers Association consulted on this?

Hon. S. Bond: I think it's important to point out that this section…. The intent and, certainly, the practicality is it doesn't preclude civil action from taking place. What it precludes is that the statement that has been compelled may not be used and will not be able to be used directly in a civil proceeding.

We did not specifically speak to the trial lawyers. In fact, we spoke to all of the partners that I listed — a very long list. Again, it has had significant vetting in terms of the constitutional issues.

It's a pretty simple principle. If you're going to ask someone to give up their right to be able to deny an interview or a statement…. You know, I think most people understand that if you're a witness officer to something that occurred…. I think most people do want them to be compelled to actually have to participate in that process. I think this is providing the balance that says if you are compelled to do this, this particular statement that you make will not be admissible if there is a civil proceeding. But there can still be a civil proceeding.

K. Corrigan: I conclude from what the minister has just said that what is being said…. That statement is compellable, but there has to be a statement, because what we had previously was only that officers must cooperate fully. Is the minister saying, then, that that full cooperation includes the compellability of statements by those officers?

[1820]

Hon. S. Bond: Yes. The duty to cooperate may be something broader than an actual statement, but the details around what the duty to cooperate looks like are being discussed and consultation is taking place. Those will be outlined in the protocol and agreed to by the parties. The issue around the protection is related to a specific statement.

K. Corrigan: I think it's interesting, and I think we always have to be careful about, you know, having protocols that are going to determine things like compellability of witnesses. It seems that that is the plan. It does con-
[ Page 12099 ]
cern me a bit to suggest that this is going to be done as something separate than either in the act or a more visible process.

Hon. S. Bond: No, I'm sorry — I think the member might have misunderstood my previous statement. The duty to cooperate is right here in legislation. That is not being determined in a protocol.

What we do need to do, and what this is talking about, is how you cooperate with the independent investigations office. It's been a very successful consultation. People are agreeing to a protocol.

For example, when you arrive on the scene, who retains authority over that scene? There are very practical things that need to be determined in the protocol, but the legal ability to compel an officer is right there in section 38.101.

K. Corrigan: I think we're maybe not quite agreeing on terms — "must cooperate fully." I'm sorry we're going back, but it's in the context of admissibility in court that I am going back. So my understanding of "cooperating fully" wouldn't necessarily mean compellability of a witness. My understanding is…. I mean, maybe it does.

But it concerns me a little bit about the drafting, because compellability of a witness is a legal structure that is very important. It concerns me a bit to suggest that later, specifically whether or not there is going to be compellability of a witness and so on, is going to be decided in a protocol. If I misinterpreted that, then perhaps the minister could clarify?

Hon. S. Bond: The duty to cooperate includes the ability to compel a statement. That's what this says. That's what the principle is. If there is a different framework around compellability of a witness, what I'm referring to is what's in the act that I have brought here. This requires officers to cooperate fully and that means that they will be required to provide statements as part of their role as a witness.

K. Corrigan: In terms of this cooperation — and I appreciate it's going back, but again, I'm looking at it in relation to the section we're talking about now. Could the minister just give me two or three other things — and this is my last question in this area — that the minister might think would also be covered under that umbrella of an officer "must cooperate fully"?

Hon. S. Bond: A number of things, again, that would be common to any witness, but certainly in this case police officers that are witness officers would be required to answer questions. They may be asked to demonstrate something that they have seen. They may be asked to turn over items of equipment or clothing, their notes. They may be required to remain at the scene until the investigative team says that they are completely satisfied that they're able to leave.

[1825]

So basic principles of investigation, requiring those witness officers to fully cooperate so that those investigations can be as thorough and as appropriate as they should be.

K. Corrigan: Sorry, I have no more questions on this section. No. Again, I've done what I did before. Sorry. I forget that these are all part of one section.

So going on to section 38.121 — the new 38.121. I'm wondering if the minister can explain why this section was brought in and whether or not this is true presently under the Police Act with regard to other investigations.

Hon. S. Bond: This is an absolutely fundamental piece that I appreciate very much the chief civilian director talking to us about. I bring it because I completely agree with the choice that he has made. I support this, or it wouldn't be here.

This is about transparency and accountability. One of the things that we want to do with the independent investigations office is build confidence in police agencies in British Columbia after all of the challenges we've faced.

This is the ability for the chief civilian director to clearly outline in the results of his team's investigation if there is a finding of fault or not. He wants the ability, and rightly so, to clearly articulate to British Columbians why there was a finding of fault or why there was not.

I think one of the things that has frustrated British Columbians is that often there is a finding which finds no blame, and that's all the public is told. The IIO will operate differently than that. There will be a summary of the incident under investigation, the resources that were used to do the investigation, what the investigative steps were and a summary of the outcomes of the investigation where there is no report to Crown counsel.

So no charges laid? We're going to have an explanation as to why. In fact, the chief civilian director is going to be transparent and accountable, and we believe that will build confidence in policing in the province.

K. Corrigan: I actually will not ask any more questions about this section.

Section 90 approved.

On section 91.

K. Corrigan: I wonder if the minister could just give a brief explanation of this section.

Hon. S. Bond: I referenced this earlier. This is the ability to establish standards by the director of police services, relating to cooperation between police, law enforcement
[ Page 12100 ]
agencies and the IIO. Again, this is to cover if there are any gaps that exist as we move forward…. We want to ensure that there are consistent and uniform practices and procedures.

So in essence, we will have the expectations laid out in the act. There will be the protocol that is now being agreed upon amongst the stakeholders. This fills the gap. If there is a need to close or establish any standards to close the gap, the director of police services will have the ability to do that.

Sections 91 to 95 inclusive approved.

Hon. S. Bond: I move that the committee at its rising report progress on Bill 41, pending a deferred decision on sections 80, 84 and 85.

Motion approved.

The Chair: Pursuant to an agreement between the House Leaders, this committee shall be in recess until 7 p.m.

The committee recessed from 6:30 p.m. to 7:07 p.m.

[L. Reid in the chair.]

BILL 36 — SCHOOL AMENDMENT ACT, 2012

On section 1.

R. Austin: Could I just ask the minister to explain the change in the definitions from "day of instruction" to "standard educational program"? What's the purpose for that change?

Hon. G. Abbott: The term is no longer used in the School Act.

R. Austin: Thank you. That's fine.

Section 1 approved.

On section 2.

R. Austin: Could the minister just explain the purpose of this section. What's repealed in this section?

Hon. G. Abbott: It allows students in grades 10 to 12 to enrol with more than one board of education or independent school. The amended section 2 allows this flexibility to be extended to kindergarten-to-grade-9 students.

R. Austin: How would the funding work if a student is moving from one school district to another to do distributed learning — and also to an independent school? I'm not quite sure how that would work. Could he explain the mechanics of that?

Hon. G. Abbott: The funding is proportional. For example, if a student were to take three of five courses at one institution and two of five at the other, the funding division would reflect that split.

[1910]

R. Austin: That would also work if a child was to go and do part of their courses at a private school?

Hon. G. Abbott: Yes.

R. Austin: Prior to this change, distributed learning was available for students, I believe, in grades 9 to 12. Now you're making this available for students to do distributed learning all the way down to kindergarten and grade 1 and 2. Could the minister explain how he envisages a kindergarten kid or a grade 1 kid doing distributed learning on their own?

Hon. G. Abbott: The important distinction is not so much whether DL would be available for, say, kindergarten through grade 9, because that's already available to them. What this bill changes is their opportunity to be cross-enrolled between their participation in a bricks-and-mortar school plus have one or two courses, perhaps, that are taken through distributed learning.

Also, I'm advised that — and this probably would be seen most in a rural instance, but not always — there's a program called Elluminate whereby about 183,000 students participate on line, typically with involvement of parents in the very youngest years and perhaps less so in the older years, but involving a teacher, parents and the student.

R. Austin: I think, though, the difference is that while it was available from kindergarten, that was, I think, specifically for kids who were home-schooled. Doesn't this change mean that a kid in a bricks-and-mortar school who previously would not have been able to access distributed learning in, say, grade 1 or 2 is now able to do it in a bricks-and-mortar school, whereas prior to this the change was that from K-to-12 you could only be in distributed learning if you were being home-schooled and obviously had a parent there?

That is quite a fundamental change — to allow a kid in, say, grade 3 or 4 to be in class for the bulk of their day but go out of class for one class or for two classes and do distributed learning, presumably in the school. Is that correct?

[1915]

Hon. G. Abbott: I appreciate the member asking the
[ Page 12101 ]
question. Apparently, the distinction is very important because DL is different than home-schooling. Home-schooling, I'm advised, is not a form of distributed learning. With home-schooling, the responsibility for the child's education rests with the parents. It's their responsibility to ensure that they are faithfully undertaking the courses and presumably developing in an optimal way.

With distributed learning, the student may have direct support from the teacher in school, at home or elsewhere, and the responsibility rests with the school district, as opposed to the parent in the home-schooling case.

R. Austin: When kids are home-schooled, most of them, I think, get a program that comes from the distance education department of the school district they're with. So in that sense, it's distributed learning. I mean, I realize they're not necessarily on line and getting direct support from a teacher, but most of the curriculum is provided by the local distance education department of that school district. Isn't that correct?

Hon. G. Abbott: Both the critic and I are going to learn more about all of these intricacies than I ever dreamed of. But the answer to the member's question is no. If he can recall what the question was, the answer is an emphatic no.

In home-schooling the student may access distributed learning or the parents and the students may develop their own program. So I'm advised that when parents and students conclude that they, for whatever reason, don't wish to be involved with the school curriculum, they can register with the school district or with an independent school authority.

They don't have to follow the curriculum. They will not be awarded a Dogwood unless, obviously, they re-enter the system at some point, whereas kids on DL are registered with either their home school district or an independent authority in that area.

R. Austin: Thanks for that clarification. So let's get back to a bricks-and-mortar school.

A kid in grade 3 in a primary class has all of the instruction from the teacher, but the parents decide, for whatever reason, to take that child out of the primary class for one course and sign that child up for distributed learning. Where does that child go in the school system? They're in the school. Where does the child go to do the DL class, and who supervises that child? Presumably, they're not doing it in the same classroom.

Can you explain all of this to us? I'm not quite understanding how kids as young as kindergarten and grades 1, 2, 3 could possibly participate in distributed learning.

[1920]

Hon. G. Abbott: We'll use the example of the grade 3 student, where that grade 3 student, for one portion of the coursework, is taking it by DL, for whatever reason. In every case the teacher would be supporting the DL, whether the child was in school or the child was at home — perhaps had an extended illness, that kind of thing — or they were travelling internationally, along that line.

Apparently, I have prepared here a very good example, which I've not previously canvassed but which I'm certain will make the point very effectively. This is the new world of distributed learning, and I'm deeply touched that the example is drawn from my constituency in the beautiful community of Ashton Creek, and this is a six-year-old named Sarah.

Sarah, mom and a B.C.-certified teacher create a personal learning plan for Sarah through on-line consultation. Mom is informed of the curriculum and expectations for Sarah in science. Mom's role in supporting Sarah in meeting the outcomes of the plan is clarified, and she is supported in playing this role by the teacher.

Using materials and magnets from the home and borrowed from neighbours and the nearby Enderby school, Sarah experiments with different materials on how magnets affect them. Sarah draws a picture of what happens and labels the picture, posting the picture on the fridge. Mom or Sarah take a digital image of the posted picture and e-mail it to the teacher.

The teacher connects with mom and Sarah via software known as Elluminate, which I previously referenced, for a conference to assess Sarah's learning and to adjust the lesson as necessary. Mom and the teacher discuss Sarah's progress and the next steps in the learning plan.

The teacher plans a small group on-line meeting with eight six-year-olds from the southern interior of B.C. through Elluminate every two weeks. The students and their parents connect to tell each other about what they have learned since the last meeting.

Again, it is adding some choice and flexibility. With 600,000 students in the system, one gets all kinds of variables at play in terms of why they might want to do some piece of this work by DL versus do it in the bricks and mortar.

R. Austin: That makes perfect sense in that scenario, if Sarah is at home with mom, which to me is almost like home-schooling. What I'm asking is if Sarah was in the bricks-and-mortar school and wanted to beg out for one portion of the day, is the teacher, who has got the rest of the class to teach and the rest of the program to, the one who supports Sarah in the class, or does Sarah go home to spend time with mom for that section of the day?

I'm just trying to understand the logistics of how this will work within the school system, where you're taking kids and allowing kids to go and do a portion of it outside of their regular classroom. How would the teacher, who has still got the 20 kids to teach, be able to support one kid who's doing something separate in the corner, never mind the other kids that they have to deal with who
[ Page 12102 ]
might have an IEP, or whatever? Could you explain that?

[1925]

Hon. G. Abbott: I think it would probably be useful for me just to note the numbers for the critic. There are currently 300 grade 1s registered with DL in the province. That number, I'm advised, stays quite stable through till about grade 7. By grade 7, the number has moved up to about 550 across the province; and by grade 9, up to about 1,000. So obviously, the growth here happens as students rise through the school years.

The teacher would not be from the bricks-and-mortar school, though, for the distributed learning portion. The teacher would be from the DL school, not the bricks-and-mortar school.

So for those 300 grade 1s or grade 3s that we mentioned earlier, it could be an instance where the child can't leave the home for any number of reasons, and there are probably 300 different reasons for the 300 grade 1 students. They may have an illness which keeps them away from school for, let's say, two months. There may be climate issues in the area, where the parents aren't able to get the child to school on as regular a basis. They may be seasonal workers who spend a portion of the year in Europe or Mexico or something like that and want to do a portion of the work on line — that sort of thing. There are just many, many different reasons why they would exercise this opportunity.

R. Austin: My example, then, could never happen. You are not going to have kids who are in a bricks-and-mortar school leaving their classroom for a portion of the day to go and do this someplace else, then. Is that correct?

[1930]

Hon. G. Abbott: The answer to the member's question is no. It could happen that the child is out for just a portion of the day.

Again, it goes to this point. In a world of 600,000 K-to-12 students, there's going to be a great range of conditions and circumstances around that child. For example, the real-world kind of example where a child might be there for, say, half the day or three-quarters of the day or some portion of the day and then home for the other portion would be that they might have some physiological or psychological condition which made it possible for them to attend for only a portion of the day. Then they might do the balance of their work through DL.

There are just so many variables here that one could presume that any number of factors may enter into the decisions that the student and the parent make around that combination of bricks and mortar and DL.

R. Austin: But what you're telling me was apparently already available. Is that correct?

Hon. G. Abbott: Yes, for grades 10 to 12 it has been there. It has not been there for K to 9. That's the change that we're making — to allow that kind of combination of bricks and mortar and DL for a student in kindergarten to grade 9. Again, the instances where one will see that are quite low — 300 out of probably 30,000 at grade 1 — but growing as the student grows.

R. Austin: I'm not really very conversant with DL at the earlier grades. I know a little bit more about it at the higher grades. For example, in my local school district kids who are doing DL will sign on to the local school district website and then go on to Moodle, I think it's called. The courses are uploaded onto Moodle, and then they will, at their own pace, go through that. Then the marker goes in and marks it and sends them back comments.

Could you tell me…? You mentioned "illuminate." I've never heard of that before. Is this a company or a system? Is it like Moodle?

Hon. G. Abbott: I've been insufferably rude in not introducing the staff that have been here with me. That's perhaps characteristic but unfortunate nevertheless. Claire Avison, to my immediate left, Mary Shaw, to my immediate right, and Rick Davis in behind — all keenly supporting me here.

First of all, again, the education of an Education Minister is never complete. It is actually Elluminate, not "illuminate." Elluminate is a software program with a video voice connection. It would, at minimum, connect a teacher and a student. It could connect a teacher and a group of students potentially as well. With modern technological capacity, it is quite possible to do that.

[1935]

R. Austin: Obviously, a lot of this will take place in very rural communities. Who would cover the costs of the computer capacity that was needed at the home to do this?

Hon. G. Abbott: I'm advised that Elluminate is very user-friendly, that most home computers are capable of managing the program. The use is free by licensing with the province, and particularly given the satellite capacity now, it's available virtually everywhere in the province.

R. Austin: To access this kind of software, one would have to have high-speed Internet — correct?

Hon. G. Abbott: One would need Internet, but not necessarily high-speed Internet.

R. Austin: If, from what the minister talks about with this program…. To be able to see the other kids on the screen when there's a group activity or to be able to look at things that are being taught, like on a sort of black-
[ Page 12103 ]
board but within a computer system…. If you were trying do that with just telephone Internet, you would be there for an awful long time — wouldn't you?

Hon. G. Abbott: No, I am advised that over 183,000 sessions…. I think I said students at one point. It's actually 183,000 sessions where teachers have been connected up with students or groups of students. Apparently, it has worked very well across the province, so it seems to be fairly sensitive to the different kinds of connections one might have.

R. Austin: If there is a huge uptake in this and far more families decide that kids from very young grades are going to start to do this distributed learning….

We, of course, have quite strict class-size limits for the early grades in a bricks-and-mortar building to ensure that there's enough time for a teacher to spend with the kids in the earlier grades. We don't need to quote the numbers there, but they're very fixed. What guarantee is there that, with distributed learning, the teacher that supports the students isn't going to be overwhelmed with the number of students that he or she has to support, if there's a huge uptake in this?

[1940]

Hon. G. Abbott: We're not expecting, as a consequence of this added flexibility, to see any great increase in uptake in terms of grades 1 through 7, say, taking on DL or that combination of bricks and mortar and DL. We expect that with the numbers around 300, 400, 500 in the area from grade 1 to grade 7….

When one spreads that across, obviously, 60 school districts and 1,600 schools, there really isn't an issue there around class size, because the numbers are just not in the realm of what class-size limits are for the standard bricks-and-mortar school. Further, again, the teachers in this instance are distributed-learning teachers. They're not the classroom teacher doing extra.

R. Austin: With regards to distributed learning, is it possible, for example, for me to go on the website and see the outcomes for all of the kids who are currently in distributed learning — in terms of their success rate for the number of courses that they enter and pass?

Hon. G. Abbott: First, in response to the member's important question, I'll just note that this is an emerging area, so the data is not as full and comprehensive as one would have for bricks-and-mortar schools only. But we do have some.

[1945]

This is from the educational year 2009-2010. These are required exams, comparing the average marks for distributed-learning students versus the average provincially. For principles of math 10, there were 90 writers. The average exam mark was 62.7. For the province, there were 3,111 writers, and 62.1 was the average exam mark.

For foundations of math and precalculus 10, 272 writers from the distributed-learning sector, an average exam mark of 70.5. For the province, 38,593 writers, the average exam mark, 68.9. For apprenticeship and workplace math 10, 121 writers in DL, an average mark of 65.2 percent; 9,733 writers in the province, a 55 percent exam mark.

For science, 10,513 DL writers, 68.4 percent average exam and 50,953 provincially, with an exam mark of 67.8. English 10 writers, 579 DL, 72.2 percent average exam mark and writers across the province, 51,700, with 69.5 percent exam mark. Social studies 11, 511 DL writers, 69.9 average exam mark and for the province, 47,262 writers, 68.6 percent exam mark. English 12, 831 DL writers, 64.8 percent average exam mark and for the province, 44,967 exam writers, average mark 69.1. Communications 12, 99 DL writers, average exam mark 68.3 and for the province generally, 5,769 writers, 65.3.

Overall, with the exception of English 12, in all of the other exams tested, the DL students were comparable or marginally above the provincial average.

R. Austin: My understanding of this change really is that, to a large extent, if a child is in a bricks-and-mortar school but is taking part of the course via DL, they really are relying on the support of a parent to be there. It's not just in terms of who's responsible for that child in terms of safety — because obviously, the child has left the school — but the parent is largely responsible for supplying the support that would be there if that kid were in school and had a problem understanding something.

The teacher who's supplying the support on DL isn't one-on-one with that kid during the time when they're learning. It's the parent doing the teaching, with the support of a professional teacher telling them: "This is how you do this particular exercise" and "Here's what the learning outcome has to be" and "Here's the exercise that you give to your child." Would that be a fair assessment?

Hon. G. Abbott: I think the member's assertion is correct. The DL does require a broader parental role than would be necessary in an exclusively bricks-and-mortar situation. That's why we don't expect any huge uptake on this beyond the 300 to 500 that one would see today in grades 1 through probably 7 or 8.

Section 2 approved on division.

[1950]

On section 3.

R. Austin: One quick question. Could the minister just quickly explain this change? I think I understand it, but I'd like to just have it on the record.
[ Page 12104 ]

Hon. G. Abbott: I'm not sure what the member's understanding is, so I don't know if my explanation will be in accord with it or not.

Basically, this is saying that we are going to move away from what has been known as a standard school calendar, and that change will take place on June 30, 2013.

R. Austin: But school districts have always had the flexibility to alter the standard school calendar. Am I correct?

Am I correct in saying that all this does, really, is that instead of school districts having to get permission to have the consultation to change the school calendar, now they can just go out on their own and do that consultation and that if the community and the stakeholders decide that it's something they'd like to have — to alter the traditional calendar — they can go ahead and do it? So the main difference is they don't have to contact the minister and the minister's office first. Is that correct?

Hon. G. Abbott: Hopefully, this will be clear. Previously to this bill, school districts have been able to go out and consult about the school calendar. They didn't require the permission of the minister. After the passage of this — presuming that it is going to pass — the same situation will hold. They can go out and consult around the calendar, and no permission is required from the minister to do that.

The only difference here is that there will not be, effective June 30 of 2013, a thing called a standard school calendar — which some people, I guess, fortunately or unfortunately, have construed somehow as an appropriate educational calendar. That will no longer be there. There will not be a reference point to a thing called the standard school calendar. Districts will make those decisions around: should it be an eight-week break, seven-week break, six-week break? Should they have a balanced calendar? All of those things they can take to consultation and make their own decisions.

R. Austin: Then, really, when this bill was introduced and some parts of the mainstream media hailed this as a gigantic change, the reality is it's not really much of a change at all. School districts always had the flexibility to alter the traditional or standard school calendar, but you are now simply getting rid of, legally, the term "standard school calendar."

[1955]

The reality is that school districts will still, on their own, go out and do consultation in their communities, and depending on what they hear locally, they're free to make that decision — as they always were, even before this bill was brought in.

Hon. G. Abbott: I think the member's assessment is correct. I know certainly I was surprised at how much reaction there was around this. I thought it was a rather simpler change.

That having been said, we've been told now for a few years — particularly by school superintendents but by others as well in the system — that the existence of this standard school calendar as part of the School Act did represent a significant barrier in terms of some people being able to move their thinking around this to think in innovative terms about how to improve an educational calendar. There was always this thing of the standard school calendar standing, whether in real terms or other terms, in the way of greater innovation.

R. Austin: This isn't really a question but just a comment. I think that when school districts go out to have that consultation, they will find, once they start speaking to parents and to teachers and to other people in the educational community, that there is a certain attachment to the standard school calendar, whether it resides here in legislation or not. It's simply because people, it appears, seem to like the status quo for whatever reason.

I think in Maple Ridge there are three or four schools which a few years ago moved onto a year-round calendar where they go to school for three months, have a month off, three months, have a month off. So they have three one-month breaks a year. Even within that school district it never spread beyond those few schools.

I think it's fair to say that…. I mean, one can remove this, but I don't think there's going to be change at all — very little — and if there is change, I think it will be very incremental.

Sections 3 and 4 approved.

On section 5.

R. Austin: Can the minister just explain what the change of this definition means?

Hon. G. Abbott: This is purely a housekeeping amendment that moves the definition of "standard educational program" to section 1.

Section 5 approved.

On section 6.

R. Austin: I think this is quite an important section with regards to the International Baccalaureate program. Could the minister just give an overview of what this section does?

Hon. G. Abbott: This section provides explicit authority for boards of education to charge fees to defer the extra costs a board incurs in offering an International Baccalaureate or IB program. There have been a var-
[ Page 12105 ]
iety of experiences around this across the province and some different practices in different districts. This is just to clarify the point of whether they're able to charge fees.

R. Austin: Am I correct in saying that currently there is a lawsuit in one of the school districts around the ability of a school district to charge fees?

[2000]

Hon. G. Abbott: We believe that to be correct. We understand that there may be such an action in school district 44, North Vancouver. But the province is not a party to it, and it is not familiar with any detail around it.

R. Austin: Could the minister inform the House as to what the reasoning is in the decision to specifically allow fees for an IB program?

You know, we spend a huge amount of resources for children who are identified as having some learning challenge or a special need. The way that I would look at the International Baccalaureate program…. Because it is quite stringently academic to be able to qualify for this program, really this is a program for gifted children.

When you consider the amount of resources that we publicly spend to support kids who have challenges, why is the government now deciding to charge fees for a tiny proportion of students who are really gifted and are able to qualify for the International Baccalaureate program?

[R. Sultan in the chair.]

Hon. G. Abbott: First, in terms of the IB programs. The students who enter into an IB program may or may not be gifted students. Almost invariably, though, they are high-performing students who are looking for an extra academic challenge to keep them excited and engaged in their education. IB programs are designed to provide them with that kind of extra challenge in their academic life.

The province is not deciding here whether to add fees. We are clarifying that it is possible for school districts, if they choose, to add a fee. The current situation is that some school districts have fees; some don't. As the member has noted earlier, there is one district where there is a legal action around whether a fee should or should not be charged.

This will enable districts, should they choose, to charge fees, as some do now. But some may continue to offer this without fees.

[2005]

R. Austin: Could the minister tell us why the government didn't decide to go the other way and say that it wasn't appropriate for school districts to be able to charge fees and say no to it?

Hon. G. Abbott: To be clear, the school districts have requested this change in legislation. Some of them have advised that they would not be able to continue to offer IB programs in that case.

We believe this is an appropriate balance. In those cases they will be able to continue to offer those programs. But as we will discuss in the next section, we're also requiring hardship programs to be put in place to ensure that socioeconomic barriers don't get in the way — that those who wish to take it aren't being limited by economic circumstance from doing so.

R. Austin: My concern with this decision is what happens if school districts come to the minister next and say: "Well, there are several other programs that we deliver which are much more costly than the traditional program with just a teacher in the classroom teaching." For example, if a school district has a program, say, with a metalwork shop or a woodwork shop, it is hugely expensive to buy all that specialized equipment to provide that program.

By saying to the school districts, "Well, yeah, International Baccalaureate does have extra costs. We'll allow you to charge for them...." Presumably, if you follow that logic, the school districts will come back and say: "Well, here are some other programs." It will create a creep, and eventually we'll end up with a whole bunch of fees for programs that are considered to be not the average cost of delivering a school program. That's my concern. Can the minister comment on that?

Hon. G. Abbott: We don't see any possibility of this happening beyond International Baccalaureate. IB programs, as I mentioned in my initial answer, are incremental to Dogwood curriculum requirements. They are over and above that. They are put in place by some school districts as a way to provide an extra academic challenge to those who want to take it on.

To use the member's example of a woodwork or metalwork course, those are core parts or core entitlements of the Dogwood program, and they would never be in the same category as incremental to Dogwood, as is an IB program.

Section 6 approved on division.

On section 7.

[2010]

R. Austin: Could the minister just explain what section 7 is accomplishing?

Hon. G. Abbott: Section 7 would require that a board that charges fees for International Baccalaureate programs be required to establish a hardship policy to facilitate participation by students who would otherwise
[ Page 12106 ]
be excluded from participation due to financial hardship.

R. Austin: Well, seeing as we have not agreed to the fees, I would just make the comment that I think…. I understand where the government is coming from, which is saying: "We're going to allow school districts to charge fees, but for parents who can't afford it, they can go to the school district, express their concerns and have it paid for."

[D. Black in the chair.]

The challenge anytime you do this is that it's a little bit belittling to some parents to have to go through that process. I go back to my earlier comments that the International Baccalaureate program…. I don't know why we disagree on this, because when the minister was describing the kind of students that go into the International Baccalaureate program, his description sounded to me very much like gifted students. It is academically quite a tough, stringent program.

It's not the average child who would be entering the academic program — the International Baccalaureate program. It is, I think it's fair to say, a gifted child.

I think that within the broad scheme of the public education system, if we agree — and we do agree — to spend a large proportion of resources on kids who have challenges, that it's not unfair within a publicly funded public education system to also provide some opportunities for kids who want to extend themselves academically and who have the ability to do that.

So yeah, I would just make that comment.

Hon. G. Abbott: Just on this point — I think it's an important one — around the student who, because of financial circumstance, might be limited in their opportunity to participate. I'm advised that school districts have always been very sensitive around this point. Very often it will be a teacher or principal who will reach out to the parents, versus the parents reaching out to the teacher or the principal, to support the disadvantaged student's participation in the IB programs.

R. Austin: I would just comment on this to the minister that I'm pleased to hear that. I think that it's very difficult for families and for parents to be the ones who have to initiate this. In some respects there might be some aspects of shame involved in it.

[2015]

I'm glad to hear that the minister believes that it is teachers or principals who understand the situations of families that would initiate this, because I think that's certainly the best way to go.

Sections 7 to 11 inclusive approved.

On section 12.

R. Austin: Can the minister just explain what the purpose of this change is?

Hon. G. Abbott: I'm advised it's pure housekeeping. It's moving the same thing to a different section.

R. Austin: I don't quite understand, though. It refers to this thing or that thing? Maybe it's just because I don't have a law background, but I'm not understanding what that means. I'm hoping we're not bringing in Thing One and Thing Two into this.

The Chair: You're on section 12, Member.

R. Austin: Yes.

Hon. G. Abbott: One can often achieve great clarity by reading the explanatory note that's been prepared, which I shall do now, having in the first instance confused the critic more than clarified, in his mind, the answer to the important question which he raised.

Section 12 repeals section 168(2)(m), which authorizes the minister to designate the purpose of one or more non-instructional days or part days. This authority is being moved to section 168.02(h). So it remains but just moves to a different section.

R. Austin: Why did it have to move from one section to another?

Hon. G. Abbott: Because it makes more sense to move it into the section with the school calendar provisions.

Section 12 approved.

On section 13.

R. Austin: Could the minister, just for the public record, explain what are in the regulations that are proposed in section 13 around the school calendar?

[2020]

Hon. G. Abbott: As I mentioned earlier, the current regulations for school calendars will remain in place until June 30, 2013. As we move to the new regs, the issues that will comprise those regs will be, as an example…. I'll give several examples here and could provide more if the member wishes, but these are the key ones.

It would set the form for a school calendar. It will set procedures for the preparation of a school calendar, including for consultation with parents and employee representatives. It will prescribe the information that must be included in a school calendar. That would, for example, include things about days in session, instruction
[ Page 12107 ]
and non-instructional days and the number of hours of instruction to be offered to students in each grade.

It will also authorize the minister to prescribe the minimum number of hours of instruction to be provided for students. So 880 for primary students and 960 for secondary students is what is currently required.

R. Austin: Does this section also allow the minister to, by authority, give any specific purpose for non-instructional days, as to what teachers are to do on non-instructional days?

Hon. G. Abbott: That authority is already available. This will preserve that authority to designate the purpose for one or more of the non-instructional days or periods scheduled by the board. So yes, it is there, but it is already there.

R. Austin: Am I correct that some of this aspect is part of the discussions going on with the mediator in terms of what teachers do on their pro-D days? Is that correct?

Hon. G. Abbott: No.

Sections 13 to 18 inclusive approved.

Title approved.

Hon. G. Abbott: I move that the committee at its rising report the bill complete without amendment.

Motion approved.

The Chair: The committee will recess until we take the next bill.

The committee recessed from 8:24 p.m. to 8:28 p.m.

[D. Black in the chair.]

BILL 37 — ANIMAL HEALTH ACT

On section 1.

Hon. D. McRae: My apologies for asking for a recess. We were in a meeting, and for some reason, my phone did not ring. My apologies to my critic opposite, but I'm looking forward to the committee stage of this and looking forward to start today and take it into tomorrow. I'll pass it over to my critic, then.

L. Popham: I would like the minister, if he could, to explain what was driving the changes to the other acts that this bill changes. What was the driving force behind that, and what were the reasons why the ministry decided to take what I consider to be quite drastic action around freedom of information and privacy, possibly even violating some of the legislation that we've unanimously supported in this chamber around the freedom of information?

I'd like to understand what the consultation was or who the minister had conversations with around this bill.

Hon. D. McRae: I think you asked several questions there. I will do my best to answer the first one, go through the second one, and if there's a third one, I'll come back to that as well.

One of the reasons we're revisiting this act is that it hasn't really been visited since 1948 or, as I like to call it, back when I was minus 22. There were some shortcomings in the Animal Disease Control Act. I'll give you a quick run-through.

[2030]

First of all, there are few diseases that are referenced under the current act. The actions that can be taken to control disease were and are extremely limited. The actions that can be taken only apply to animals, not animal products or by-products. The powers assigned to inspectors, by all intents and purposes, were rather vague and not consistent with modern legislation, specifically with reference to the Charter of Rights and Freedoms.

Penalties are and were very low and do not serve as a deterrent to unsafe practices. Penalties may only be applied upon conviction. However, in reality, few social regulatory offences are prosecuted, making the penalty system ineffective except in the most serious cases.

There are few recordkeeping requirements. Those that exist were drafted prior to the Freedom of Information and Protection of Privacy Act. As a consequence, the records held by the Abbottsford Animal Health Centre may not be protected.

Also to that, the reality is that the world has changed so much since 1940. I know the members opposite definitely know that. With world travel, zoonotic diseases which have seen diseases that will transfer from animals to humans have become more of a reality.

Also, part of this legislation is about basically preparing for the disease that is yet to come. We don't revisit legislation very often. Obviously, this is the first time in 60-plus years that this piece has been revisited. For that reason, we are giving the flexibility to this government and to future governments to address concerns as they arise in our future, giving us the ability to be responsible both for animal health and for human health.

As for consultation, aside from public consultation, several other ministries and organizations have been contacted. We would include in those groups the provincial veterinarian and staff; obviously, Ministry of Agriculture staff; Ministry of Health; Ministry of Environment; Ministry of Forests, Lands and Natural Resource Operations; the statutory immunity committee; the office of the chief information officer; Justice and
[ Page 12108 ]
Attorney General; Canadian Food Inspection Agency.

We also talked with the trade policy and animal health care specialists in Alberta, Saskatchewan and Ontario. Lastly, through the general public, we had an on-line consultation, and various livestock sectors were consulted.

Furthermore, we had meetings with the B.C. Milk Producers, B.C. Milk Marketing Board, B.C. Cattlemen's Association, the B.C. Association of Cattle Feeders, B.C. Pork Producers, B.C. Poultry Association, B.C. Turkey Marketing Board…

Want me to keep going? I might as well. I'm on a list here.

Interjection.

Hon. D. McRae: On the record. You got it.

…B.C. Chicken Growers Association, B.C. Broiler Hatching Egg Producers Association, B.C. Broiler Hatching Egg Commission, Specialty Bird Producers, the Horse Council of British Columbia, B.C. Sheep, Agriculture and Agri-Food Canada, CFIA, which I mentioned earlier, and the College of Veterinarians of British Columbia.

I think that was mostly comprehensive. I can't remember if there was a third question for me to answer as well, but I'll find out in a second.

The Chair: I'll just remind the minister to put his remarks through the Chair, please.

L. Popham: Can the minister please tell me how long this legislation took to draft? What was the time period the minister was looking at?

Hon. D. McRae: Consultation began with industry and stakeholders in approximately early 2010. Drafting began in 2011, and we are here today.

M. Sather: I want to ask the minister a question vis-à-vis definitions. This is an amendment to the Animal Disease Control Act. The former act — i.e., the Animal Disease Control Act — has a definition for "aquatic animal," which is not contained in this bill. Could the minister explain why it is not contained in this bill?

[2035]

Hon. D. McRae: I'm sure the member opposite has looked at the definitions. You'll notice, under "animal," that animal is defined as "(a) a species of the animal kingdom, and (b) any organism prescribed as an animal." So fish, aquatic animals, would be captured under subsection (a).

M. Sather: Well, that's a novel suggestion by the minister. Let's pursue that a little bit.

Animal means, subject to the regulations, "a species of the animal kingdom" — which I get; that was (a), and — "(b) any organism prescribed as an animal." What, pray tell, is "any organism prescribed as an animal"?

Hon. D. McRae: Like I mentioned earlier in my statements, this act was last revisited in 1948. While I hope that future ministers may come back a little bit more, the reality is that we are, again, sort of pondering where we will be in the future and giving us some flexibility.

So when we're talking about — under "animal" — "any organism prescribed as an animal," an example could be, though nothing exists to this date, like a cultured beneficial bacteria. Again, it doesn't exist. We don't see it existing in the future, but again, we're not sure, as the world progresses in the next decades, what may or may not appear before us. We want to make sure this act will capture those potential possibilities.

M. Sather: The minister is obviously responsible, in his portfolio, for fisheries and fish. This being a very topical issue with regard to a whole range of issues — some of which I've canvassed with the minister previously, regarding viruses, etc. — which are very important to the future of British Columbia. I think I would like to get into one more question with the minister.

It seems to me, although he's come up with a somewhat arcane definition of "organism," being bacteria, etc…. You know, suddenly fish are nowhere to be seen in the definition — right? Fish are not included, aquatic vertebrate or aquatic invertebrate — invertebrates being fish food.

My concern is that the minister is shying away from the Fisheries Act just as he has shied away from answering questions in the House recently, in question period, about fish, deferring to the Minister of Environment. So I want assurances from the minister that fish are not being disregarded, as would seem to me to be the case from the definitions.

I look forward to the minister's comments on that, whether it'll be this evening or later. I'll give the minister time to respond to that.

[2040]

Hon. D. McRae: I think that university biologists and learned individuals would all agree that fish are a species of the animal kingdom, and it is a generally accepted definition. It does capture aquatic creatures by all means, though some people may argue that. We were just laughing about the backbones of certain creatures. Bees don't have backbones and neither do crabs, but they are also members of the animal kingdom.

I am always looking forward to the member opposite asking more questions in question period about fish. Perhaps tomorrow will be a good day. It is Thursday, and I always look forward to your very well-thought-out questions.
[ Page 12109 ]

That being said, noting the hour, I move the committee rise, report progress and seek leave to sit again.

Motion approved.

The committee rose at 8:41 p.m.

PROCEEDINGS IN THE
BIRCH ROOM

Committee of Supply

ESTIMATES: MINISTRY OF HEALTH

(continued)

The House in Committee of Supply (Section C); P. Pimm in the chair.

The committee met at 2:44 p.m.

On Vote 29: ministry operations, $16,032,867,000 (continued).

The Chair: Good afternoon. We're resuming the consideration of estimates of the Ministry of Health.

I just wanted to say that this is going to be the first time in the history of this parliament that we are actually going to be hosting these debates in Section C. The same rules are going to apply as would normally. The only difference is that if there is a division, it will be dealt with at the end of the day in the main House.

M. Farnworth: It's interesting to be participating in this historic moment. It's appropriate that the Minister of Health should be here. So perhaps he can answer a question before we begin.

[1445]

Given the rarified elevation that we are at in this committee room and that it's never been used for this kind of work before, can he tell us if bottled oxygen will be provided in case altitude sickness sets in?

Hon. M. de Jong: Well, two things come to mind. One is to assess whether or not that is a coverable benefit under MSP.

Secondly, though I have not shared this with the member, I have consulted the records of the gentleman who originally designed these buildings, and I am satisfied that this storied, historic Birch Room was designed and constructed with precisely this kind of proceeding in mind. For us to be the first to put it to its proper and appropriate use is, I confess, almost overwhelming, but I shall endeavour to go on.

M. Farnworth: I thank the minister for those assurances that we are operating in a healthy environment up here.

Yesterday when we adjourned debate, I think we'd dealt with issues around psychotherapy and registered clinical counsellors. The minister indicated at that time that he would get back to me with some further information. I wonder if he's got that at hand. It looks like he does.

Hon. M. de Jong: Just by way of context…. I anticipate the member will, I hope, be inclined to agree with most of these propositions, they being mostly statements of what I believe are accurate facts.

The B.C. Association of Clinical Counsellors is, at this point, a wholly private organization, established under the Society Act, which has a voluntary membership. To that extent, it would be incorrect to suggest that it is accountable to the government or even, necessarily, to the public for its professional activities. There is no linkage between the society and the government around the manner in which its professional activities are carried out.

I say this not as a way to slight the work of the society or the membership, but it would not be considered a regulatory body, in the sense that it is not a public body with a mandate from the state to regulate an area of activity in the public interest.

That, I think, makes it a bit challenging for myself or the government to make comments on the manner in which the association acts to discipline its members. I expect that in part, the member's question on this area derives from that fact, since it becomes an internal matter or remains an internal matter within the society.

At the same time, I should acknowledge that the association has made considerable effort over the years to develop recognition and acceptance by the public, health professionals, health authorities of the title that it has adopted for its members, "registered clinical counsellors," though that term does not necessarily apply in the way that it would to other health professionals.

[1450]

All that's by way of background to confirm that we do consider the issue, and the part of the issue that the member raised, still very much a live issue and a matter of public interest that is deserving of further attention.

I can't tell the member that I anticipate the formation or creation or sanctioning of a college in the immediate future, but I can tell the member that that is a question. The manner in which regulation of the members in a way that is cognizant of the public interest might develop or evolve in the future.

The dialogue, I am assured, is ongoing, but at the same time, I again don't want to create the impression that the formation of a college is due to occur in the immediate future.

M. Farnworth: I thank the minister for that response.

I'd like to move to a couple of topical issues which
[ Page 12110 ]
we've dealt with in question period but that the minister has also dealt with: a number of cases that have been referred to him around eating disorders as well as bariatric surgery.

I think one of the issues that sort of came to light early on in the session was around eating disorders and the real challenge that many people face in overcoming this terrible problem. The range of psychological and mental health issues associated with it is really quite remarkable in a very negative way.

There have been a number of issues raised around current eating disorder programs within the province of British Columbia. Much of it is dealt with by St. Paul's Hospital. There have been issues raised by people in remote or smaller communities in rural parts of British Columbia on the ability to access services. The minister has also stated that if people do need to be sent out of province, then the province is quite prepared to do that.

I've got a number of questions from people working in the eating disorder field and people suffering from eating disorders that I think, if the minister would be able to answer, would really help to clarify things in B.C.

I guess one of the questions is around the gaps that we have in eating disorder programs. The government apparently is working on or has a plan. Can the minister tell us when that plan is going to be released?

[1455]

Hon. M. de Jong: Since I think we're going to spend a bit of time on this, I'll provide a little bit of context around the nature of the services that are available now in terms of their breakdown. I'll try not to take too much time in that respect.

A challenging condition — and no less perplexing, in many ways. As the individuals who I have met with who suffer from the affliction point out, it is a mental health issue. I actually pointedly asked them that question, because I felt a bit odd asserting that someone with an eating disorder disease had a mental health issue. But the patients themselves say: "No, that's our problem. It is a mental health issue."

For people suffering from severe eating disorders, there are a number of options. The member has mentioned St. Paul's Hospital, where there are seven beds with a specialized eating disorder program.

Ten beds at St. Paul's Discovery, Vista programs, where adults can receive treatment for up to three months in a supportive home environment.

Ten beds at Woodstone, the residential care facility for medically stable patients, where the government committed some funding — $4.1 million for Woodstone, located on Galiano Island. In that case the program deals with women between the ages of 17 and 24.

Twenty beds to treat youth at B.C. Children's Hospital.

We'll undoubtedly deal with this in further detail in a few moments, but I will say this. The trend, and the emphasis that reveals itself in the approach that is being taken, is very much to try to identify the symptoms of eating disorder as early as possible, insofar as the success rate for treatment seems to be much greater the earlier treatment begins.

The member's specific question related to the planning. That planning and program redesign is taking place on two fronts. One is at St. Paul's itself, where there is work being undertaken.

The issues that arise relate to, in my view, a number of things — access to programming, the relationship between family physicians and the referral process from outside of Metro Vancouver into the programs. That work is being undertaken.

Then the logical second part is community-level supports. I would say there is also a marked bias in favour of, as part of the early intervention strategy, having resources in place in communities to assist in providing treatment with people in their own environment.

In both of those cases there is an active working group involved. Part of that working group, I can tell the member, is a group of young women that I, along with senior staff, met with in February, who laid out in very specific and compelling detail some of the challenges they face from an operational or from a practical point of view.

These were women who, because of their age, did not have the opportunity to access the Woodstone program, so they would have been relying on the other programs available. I'm happy to say and report to the committee that that engagement has been fruitful, regular and ongoing.

All of this is by way of indicating to the member and the committee that the results of that work are likely, I'm told, to reveal themselves in a detailed plan and a report inside of three to four months.

M. Farnworth: I thank the minister for that answer, particularly the last part, because I think that's one of the issues that…. When we've met with individuals suffering from eating disorders, a lot of those questions….

[1500]

There are a lot of resources, as we're told, for if you're 17 to 24 in the province. A lot of them are community-based, and they are accessible. The challenge becomes once you're past 24.

There is, as the minister stated, the Woodstone project. I think that's where we're seeing, particularly, some of the most, really, heart-wrenching cases. So the fact that the minister has got a group working on this issue, I'm pleased to hear. I think the same women that he met with, we also met with. So I think that is a positive step forward.

The minister has indicated that three to four months is when they're expecting their work to be completed. Can he also tell us, then: does that discussion or does some of that work look at what's happening in terms of St. Paul's and the Quest program which was in place there?
[ Page 12111 ]

There seems to have been a considerable amount of concern with the elimination of the funding for the Quest program. There was some real anxiety when it was done away with, so is that part of the ongoing discussions that are in place?

Hon. M. de Jong: The short answer is yes. It is very much a part of the conversation. Further, I can confirm for the member and the committee that as part of the discussions that have been ongoing, a very forceful case has been made by some of the patients and their families about the concerns that arose when Quest was reconfigured or, from their perspective, disappeared. The manner in which the Quest program, or elements of the Quest program, might be reintegrated into the new plan is, apparently, very much on the table.

M. Farnworth: Before I continue, I'd like to acknowledge on this historic day of the first committee meeting in the Birch Room the presence of the hon. Opposition House Leader — who, I might add, is also blocking the minister's and my camera angle. If we have to play off-Broadway, we at least want as much camera time as we can get.

I thank the minister for that answer, and I'm pleased to hear that the Quest issue is part of the discussions with the committee, because it did cause a lot of anxiety. I think that is one of the key issues that has certainly come to my attention in my discussions with individuals suffering from severe eating disorders.

These mental health issues are very much at play, and issues around anxiety and depression and all those things — and uncertainty. What's really needed is stability and a sense of certainty, so I appreciate the minister's response there.

Now, government policy is that, in certain circumstances, people can be sent out of province to other treatment facilities. I know that there is one, I think, in Ontario and another one in Alberta. Can the minister tell how many people have been approved for funding to attend programs outside of B.C. in the past fiscal year?

Hon. M. de Jong: I'll start while the number is obtained. It will, I expect, be a small number, because every effort is made to provide treatment in B.C., one, because we think that is more appropriate for people and, secondly, because of the cost involved in accessing programs outside of British Columbia.

[1505]

There are a couple of things I might take advantage of the question to point out. There is, certainly, the program in Ontario.

At an event recently held to celebrate the achievement that is Woodstone, I had the occasion to discuss the treatment of eating disorders generally with a very internationally recognized clinician. He did have this rather complimentary summary to offer, not just to me, but he made the point to the audience of some 200 or 300 that were gathered there to support Woodstone.

That is that in general terms, the approach he saw being taken by clinicians, health authorities in British Columbia and, to be fair, Woodstone in particular was something that he saw as leading edge and that he was desperately hopeful would be duplicated in Ontario. I could pretend otherwise. It generally feels good to hear someone come from abroad and in an unsolicited way say that what is taking place here is worthy of duplication elsewhere.

The process by which people secure a referral outside of the province is ultimately dependent upon the recommendations that are received from treating clinicians. That, in the past — even in the time that I have been Minister of Health — has revealed itself to create tension at times.

One of the topics that came up in the discussions I had with the group of women suffering from eating disorders…. I say parenthetically that it is interesting that there is a disproportionate amount of women who suffer from this ailment. I won't pretend to know or describe the reasons for that, but it was no accident, I'm told, that the group was comprised, I think, entirely of women.

In a couple of cases the frustration that was expressed during that meeting related to securing the recommendation from the clinician and then, secondly, the perception that there was difficulty or hesitancy in translating that recommendation through St. Paul's into an actual ministerial approval for placement outside of B.C. Some of the work that is taking place is designed to address that.

The member's question was: how many? I'll endeavour to get that now.

In the past year….

Interjection.

Hon. M. de Jong: Ah, that is an important distinction.

The numbers I'm about to give refer to referrals for residential care. Referrals for acute care would not come to the ministry, would follow a different route.

For placement in a residential facility outside of B.C., there were two — one to Alberta, one to Ontario. There is an additional one pending, and I'm not certain whether that is for Ontario or Alberta.

Interjection.

Hon. M. de Jong: Ontario, I'm advised.

M. Farnworth: I thank the minister for his answer.

I think the Woodstone site has a…. The model, I think, is a very positive one, and it's one that we want to encourage. The fact that the province is participating and is funding ten beds I think allows an expansion of service
[ Page 12112 ]
and a type of service that's needed.

[1510]

Given the minister's comments about being at Woodstone and some commentary from outside experts in the field, can the minister tell me a little bit about, then, the government's plans with regards to funding for Woodstone? I believe there was about $4 million that was approved for three years, and that expired for the beds at Woodstone. But that expires in October of 2013, I believe.

Is it the government's plan to continue the funding for Woodstone past the 2013 date so that those beds can continue to operate?

Hon. M. de Jong: Certainly the member is correct in terms of the funding commitment that has been made over the three years, the $4.1 million. There is an assessment process underway to track the results. A couple of other things, though, come to mind. They are of course approved for 20 beds. Ten of them are funded.

I think that the genesis for this came from, as I recall, a couple of very passionate mothers who saw the devastating impact this disease was having on their children and decided to take action. It is, from that point of view, a very remarkable story about what can be accomplished by people motivated by a desire to do societal good.

I have met with them relatively recently, and they have additional plans and would like to expand. The business model for this is built around the assumption that they will attract private business and generate revenue from that, from referrals from either British Columbia or outside of British Columbia, given the nature of the work that they do.

I should say to the member that I also, in the course of our discussions, have asked about the issue of age. My question, by the way, related to the fact that with all of the clinical evidence highlighting the importance of intervention — the earlier, the better — was there particular magic in the 17-year-old cutoff?

I think it's fair to say that the strongest concern I heard expressed related to the challenges that might result from having a 14-year-old in a residential setting with a 24-year-old. I have asked the society to examine whether or not, given the importance of early intervention, there is a way to accommodate younger residents.

[1515]

I don't presume to offer an opinion about the risk or the benefit, except to observe that all of the material I have read again highlights the importance of tackling this issue earlier — the earlier, the better. The model evolves. The assessment will be undertaken.

Anecdotally, from the point of view of patient benefit, I would say that there are some early positive indications. Like many of the endeavours that are launched, and in partnership with societies who intend good, and public dollars, the analysis and the assessment must look at the clinical accomplishments and also look at the fiscal side of the equation.

My sense at this point is that there is a strong belief in the project and the benefits that accrue. Again, I suppose the strongest endorsement I have heard is from the clinician who visited and headlined the night for the society, who made it clear to all that were gathered that this is precisely, in his view, the model for residential treatment that he hopes his home province of Ontario would adopt.

M. Farnworth: I thank the minister for that answer, because I do think it's important that we recognize that this is, I think, an ongoing issue and it's not going to disappear. I think it's one that is often sort of forgotten. It doesn't have as high a profile as many other illnesses or diseases that get the attention of our health care system. I'm glad to hear the minister's remarks.

Just one final question on this particular topic area, and then we can move to another one. That is: what's the total amount that we spend on an annual basis at the current time in terms of treating eating disorders?

Hon. M. de Jong: Direct programming dollars through the health authority and/or ministry would be $9.8 million. That would not capture the additional cost of any costs associated with MSP billing by physicians, nor would it include any PharmaCare-related costs. That would be direct programming funding.

M. Farnworth: I'd like to move on to another topic where there has been a fair degree of concern about government policy and the direction of government. That's on the issue of bariatric surgery. Bariatric surgery, as the minister is no doubt aware, is a method of controlling the size of the stomach and dealing with severe cases of obesity. It encourages the patient to eat smaller portions and, therefore, to lose weight.

[1520]

In 2009 funding for the surgery was cut by 60 percent. In 2010 the Provincial Health Services Authority began a review of weight-loss surgery in B.C., but as of April of this year, the review had still not been released.

There have been numerous studies that have shown that bariatric surgery can be an effective way to treat obesity amongst diabetics, for example. The cost of bariatric surgery can pay for itself within four years of placement and within two years for people with diabetes.

Ontario last year funded ten times more bariatric surgeries per capita than British Columbia. Alberta has an approach that provides pre and post services, and it seems to be using this procedure more than here in British Columbia.

Can the minister outline to me what the province's current policy is with regards to bariatric surgery? Also, when can we expect the review that was done by the Provincial Health Services Authority to be released?

[1525]

Hon. M. de Jong: Apologies for the delay. Again, maybe a little bit of background, and then — assuming I remember what it was — I'll endeavour to answer the hon. member's specific question around the review and what turned out to be a case study or a business case study.

We have, I'm advised, in B.C., five surgeons who perform publicly funded bariatric surgery. The number that may be of interest to the member and the committee is the number of publicly funded bariatric surgeries performed in Vancouver Island Health Authority and Vancouver Coastal Health Authority, which are the two health authorities in which the surgery is available. In '09-10 there were 91; in '10-11, 58; in '11-12 it went up to 141 bariatric surgeries. There was additional funding provided for that — 40 in VIHA and 36 in Vancouver Coastal.

[D. Hayer in the chair.]

As of the end of March, beginning of April of this year there are 363 people who have been identified as being eligible for the surgery and who are waiting for the surgery; 67 percent of those people have been waiting for more than a year. The median wait time is about 23 weeks.

As the member pointed out, the Provincial Health Services Authority conducted a review and submitted at our request a business case for a bariatric surgery strategy. That occurred in February-March. We're now reviewing it. What I would anticipate happening is, as we develop the response to that, we would release the two together so that the PHSA proposal and the ministry response to that would be released together. That likely will happen in the fall. It should happen in the fall, based on what I am advised. My guess is there will be a gap between what the requests are and what the abilities are.

This is sort of an interesting snapshot of the tension that exists as we talk about — and it's easy to talk about — the shift from prevention to treatment. I have observed, particularly over the last year and a half, that when we talk about prevention and how the emphasis needs to be on prevention, virtually everyone nods their head. What we tend to really be saying is: "Yes, let's keep doing everything we're doing now or more, and add a healthy layer of prevention."

[1530]

I don't know that we have that luxury from a fiscal point of view. It's troubling when — and I'm sure this happened when the hon. member was the minister — the Ministers of Health get together and they wring their hands in despair because the obesity rate in the country continues to climb.

We sort of chortle a little bit in B.C. and say: "Oh, look at us. We're the best. Our obesity rates are lowest." Last time I checked, our obesity rate was in the neighbourhood of 42 percent, making us the best of a very bad lot. So that shift needs to occur.

In the meantime, if you're one of the 363 people waiting on a list, for whom surgeons have said, "You can benefit from this surgical procedure," you're probably saying: "Well that's all well and good, but when am I going to get my surgery?" As I've indicated, we're working with the PHSA on the development and finalization of a strategy.

In the meantime, what I have seen around the projections for the number of people who would qualify and be in need of this kind of surgery only amplifies and enhances my resolve to do more and, as much as we can, to ensure that people have all the tools necessary to make healthy choices and prevent, where it is preventable — and there are circumstances where it's not — to take the steps necessary to avoid the onset of obesity.

M. Farnworth: I thank the minister for his response. I think he anticipated a number of questions that I'd be asking, and he's dealt with a number of them. So we'll be able to move on to the next topic. Actually, I think it's appropriate that he mentioned the issue around prevention, because I think that's where we'll be going to next, with my colleague from Delta North on the preventative side of health care for a bit.

I guess the issue is that when 67 percent are waiting more than a year, and the median wait time is 23 weeks, half the people, then, are getting it at less than 23 weeks and half of them are waiting a lot longer than 23 weeks. So it's my hope that this review is looking at ways to address that. I think that's crucial.

I'm happy with the minister's answer in terms of when the report's expected release date is. I think it's something that we will be looking forward to.

With that, I will turn it over to my colleague, who has got questions around preventative health.

G. Gentner: Let me begin on the obesity issue. The public health officer has noted quite an interesting dichotomy — that it's females with lower income that have the higher incidence, as opposed to the men, who seem to have more of a static relative occurrence of obesity.

I want to talk about the whooping cough immunization and the current epidemic, or potential of an epidemic. I know the ministry has been working hard on this one. Let me begin by saying I welcome this forum here today, in Committee C, because for the first time, unlike in Committee A, when the minister gets up to speak we can see on camera that he actually consults with his people around him, which is quite refreshing.

Hon. M. de Jong: Are you saying my brilliance has been undermined?

G. Gentner: Not at all. This is a very smart fellow we have for a minister, but it's worthy to note that he does have some high-priced and good-quality help.

I want to know, first of all, regarding the tetanus, diph-
[ Page 12114 ]
theria and pertussis booster: have all the health care workers in the province had their up-to-date immunization?

Hon. M. de Jong: For tetanus?

G. Gentner: Particularly for pertussis.

[1535]

Hon. M. de Jong: The public health officer, the chief medical health officer, Perry Kendall, is here. He advises that he can say with certainty that the public health workers in Vancouver and Fraser have received the relevant immunizations.

G. Gentner: Whooping cough is airborne. It doesn't know boundaries. From my understanding, the whooping cough situation is found beyond just Vancouver Coastal and Fraser. We know it's a huge problem now south of the border, of the 49th. Can the minister explain when all health care workers will have this booster shot?

Hon. M. de Jong: To be clear, I don't want to leave the impression that public health officers outside of those health authorities haven't received immunization. The provincial health officer was able to advise me with certainty that all public health officials within those two health authorities have received the immunizations, and we will endeavour, even while these proceedings are underway, to ascertain what the situation is in the other health regions.

G. Gentner: Has the ministry conducted any studies of the effectiveness of Adacel?

Hon. M. de Jong: As I understood the member's question, it was whether or not we had undertaken studies on the effectiveness of Adacel, a vaccine. The short answer to that is no. We are aware, I'm advised, that the product has been approved by Health Canada on the basis of some manufacturer-sponsored trials. But it would be incorrect to suggest that we have undertaken an independent assessment of its effectiveness.

G. Gentner: Has Fraser Health or Vancouver Coastal had any cases of a person who has been immunized and has contracted whooping cough?

Hon. M. de Jong: The answer that has been relayed to me from the provincial health officer is yes.

[1540]

G. Gentner: Can the minister explain? What is the success rate? Is it 85 percent who have Adacel, for example, and don't come back? How many people are we looking at percentage-wise who take Adacel and come back later positive with whooping cough?

Hon. M. de Jong: Again, I'm advised that we are operating on the basis of an 85 percent efficacy rate.

G. Gentner: I talked to the public health officer before about this, but for the record, I just want to know: is there any concern at all that there's a new strain that's evolving within this pertussis that maybe inoculation will not be able to address? Perhaps there's a genetic code that's shifting.

Hon. M. de Jong: This is a concern that has been raised. The provincial health officer has been in contact with the National Microbiology Laboratory in Winnipeg. At this point it is only a concern, and I'm advised that no data or empirical evidence has revealed itself to suggest that it is actually occurring.

G. Gentner: Can the minister advise how much vaccine is actually available at this time, where the public can obtain it and what the costs are? Is it from pharmacies? Is it from your doctor? Can school kids get it at schools? Can we break down how the distribution occurs?

Hon. M. de Jong: Here's a breakdown. If there are questions that flow from this, I'm happy to do my best to answer them. At the highest level 95,000 doses of the vaccine have been distributed throughout Fraser and Vancouver Coastal. That, I am told, is approximately twice the normal number.

[1545]

The vaccine is provided free of charge to children at two, four and six months of age; a booster at 18 months; at four to five years of age, a booster; and in grade 9, a final booster.

In the case of an outbreak the vaccine is made available free of charge to parents, to health workers who may come into contact and to people who may be in contact with young children. The vaccine is available at public health clinics, at doctors' offices and now, of course, also at pharmacies with pharmacists authorized to provide vaccinations.

G. Gentner: To be clear, within Vancouver Coastal and Fraser Health it's noted that it is classified as an outbreak right now — correct?

Hon. M. de Jong: I am happy to advise the committee that I have today learned the very technical and complex definition for what constitutes an outbreak. It is more cases than normal. By that standard, an outbreak has occurred in Fraser and in Vancouver Coastal. By that standard, the doctor advises me that for this particular disease an outbreak occurs about every three years.

I can provide the member with more complete up-to-
[ Page 12115 ]
date data about the status of the outbreak now.

Fraser peaked in March, and there has been a steady decline since then. There are now, and these are averages, presently about six cases per week identified in Fraser, though the provincial health officer cautions me that given the heightened awareness, some of that is probably attributable to more diligent diagnosis and the fact that physicians are paying particular attention to diagnosis.

[1550]

Vancouver Coastal presently, I am advised, is identifying about two to three cases per week.

H. Lali: I'm going to switch to rural health care and rural hospitals. I'd like to ask the minister why the B.C. Liberals are abandoning the health care needs of rural communities like Merritt, Ashcroft, Cache Creek, Lytton, Princeton, and all these small rural communities across the province.

Interjection.

H. Lali: For rural health care. I was wondering why it is that this government is not looking after the health care needs of small rural towns with small hospitals or health centres, and I named a few communities in my constituency like Merritt, Ashcroft, Cache Creek, Lytton, Lillooet, Logan Lake, Clinton and Princeton.

Hon. M. de Jong: The member will understand that I disagree and dispute the premise of the question and will endeavour, over the course of our discussion, to highlight the basis for that disagreement.

I'll begin by talking about one aspect, and admittedly one aspect, of rural health care. It is one that I'd suspect many rural British Columbia residents utilize as a benchmark for the provision of health services, and that is their access to a physician.

Let's go over some of the facts surrounding physician supply in rural B.C. The concern we had around this was revealed in the fact that we took seriously the observation that in order to attract physicians to rural British Columbia, to northern British Columbia, you probably had to take greater steps to ensure that there was some opportunity to train as a physician in that part of British Columbia.

That gave rise to the northern medical program to actually educate doctors in northern B.C. It's not, admittedly, a cheap or short-term solution but one that we thought particularly warranted, given some of the challenges that communities were facing and, of course, based on the premise that if you're a physician educated in a rural area, you're more likely to stay there.

We are beginning to see the benefits of that strategy. The first cohort of graduates is beginning to practise in B.C., and 40 percent of those who have graduated from the northern medical program and are practising have set up practice in northern B.C. Now, it is a modest start but one that I believe will reap huge benefits going forward.

The fact that we are training twice as many physicians in British Columbia today as was the case ten or 11 years ago…. I will ask, and I'm sure the member will want to offer an opinion. As someone who was there at the time, he is perhaps well-positioned to offer an opinion, at least, as to why the province chose during the 1990s not to expand by one the number of physicians we were training here.

[1555]

There's one thing about demographics. They don't sneak up on you. It was so abundantly clear as to what was going to be taking place. Yet it wasn't until 2002 that concrete steps were taken to address what was clearly emerging to be a physician supply problem.

Now, we took those steps, but the length of time it takes to train a physician, move them through residency programs and have them available to serve communities is lengthy. Only now are those physicians becoming available. Between 2003 and 2009 the number of doctors practising in rural areas has increased from 1,770 to 2,269 — an almost 30 percent increase.

Here's another interesting number. B.C. has 874 rural residents per GP, according to 2009 statistics from the Society of Rural Physicians of Canada. So 874 rural residents per GP, compared to the Canadian average, which is 1,153. We are dramatically below, in a positive way, the national average.

There are still issues, however. In fact, in some communities there are serious issues around the provision of medical services.

That's why we introduced the rural recruitment incentive fund, for up to $20,000; the rural recruitment contingency fund; a loan forgiveness program for nurses, nurse practitioners, medical residents, doctors. The province will forgive any outstanding B.C. student loan at the rate of 331/3 percent per year. After three years one of those medical professionals will have their student loans completely paid off or forgiven as an incentive to get people to practise.

There are, despite that, situations in which we experience shortages of specialists — ER physicians prepared to offer services and be on call for emergency room services. That's why we created an additional fund of $10 million to facilitate additional emergency room coverage in rural areas of British Columbia.

A community like Princeton, for example, can submit a plan to say: "With an extra $100,000, this is how we plan to expand" — or maintain, for that matter — "emergency room coverage." Communities across B.C. have availed themselves of that.

The last thing I'll say, by way of introduction to this matter, is the government a number of years ago introduced and passed legislation establishing the nurse practitioner, a graduate-level training program that pro-
[ Page 12116 ]
vides registered nurses with enhanced training. We now graduate upwards of, I think, 40 or 45 nurse practitioners per year.

The remaining challenge there, in my view, is to properly deploy those nurse practitioners to address the gaps that still exist in some rural communities where we have not enjoyed success in attracting physicians.

So in one single area — but I would suggest to the member and the committee an area that most people would use as an important benchmark for the attention that is paid to rural health care — I would suggest that the effort speaks for itself, the commitment speaks for itself, and ultimately, the results speak for themselves.

H. Lali: The results do speak for themselves. What we've seen is a wholesale abandonment of health care in rural British Columbia by this government for the last 11 years that they've been in office.

[1600]

I know the Liberals like to blame doctors and say: "It's not an issue of finances. It's an issue of doctors not wanting to come to small towns." They like to lay the blame on the NDP. There is not a shortage of doctors in B.C.

I mean, money has not been allocated to pay doctors for the ER services at the expense of rural communities like Princeton. Until a year and a half ago, Princeton had at least five locums to call upon for the operation of our ER. Now we have none. At that time, Interior Health Authority made a significant cut to their ER pay. Since that time we have had trouble getting doctors to work in our ER in Princeton. The situation repeats itself in those communities in my riding that I mentioned to the minister earlier.

I would also like to submit that in 2000 there were 22 hospital beds in Princeton. There are six beds there now. In the middle of the night the IHA came and took 14 away. Also, in 2000 we had an operating room in Princeton, a 24-7 emergency room, a nurse to assess your emergency, an intake nurse for registration, a maternity ward, four doctors covering ER, a full-time pharmacy, full-time health technicians — X-ray, blood work, etc.

Today in 2012, as I mentioned, there are only six beds; no OR, operating room, in Princeton; unreliable hours; frequent closures instead of a 24-7 emergency room; a pay phone outside the ER, a television monitor to a nurse in Kamloops; no maternity ward; 1.5 doctors; no pharmacy. And as far as full-time health technicians, it's now part-time and dwindling rapidly since the Liberals have taken office.

Initially this government closed the ER in Princeton on Christmas Eve without any consultation or notice. There were no nurses available. We had an inappropriate level of nursing staff. Then in February the Interior Health sent out a notice about temporary service changes at the Princeton General and said that due to limited physician availability, there would be times when only the most urgent cases would be seen by the physician on call. They said they were going to reduce the ER operating hours and close the ER on 22 days from midnight to 8 a.m. in February. About a week later it was increased to 25 days that it was closed.

It was suggested that.... I have the IHA communiqué with me. "Patients with less urgent matters will be assessed by our trained nurses but, depending on their condition, may be transferred to a nearby hospital for care or offered appropriate options. If this is the case, it's important to come prepared," it says here. This is the Liberal's IHA communiqué. It says that if this is the case, "it's important to come prepared. Bring your wallet, shoes, clothes and make arrangements for the return home" — when they ship you off to another hospital.

I mean, when people are having an emergency, if they're having a heart attack or folks are involved in a critical accident or they're working in the sawmill…. Weyerhaeuser has a sawmill in Princeton. If people are capable of either driving themselves to the hospital in the case of an emergency, or if they're totally incapable of doing that and people who are tending to them are going to drive their loved ones or their co-workers to the hospital, the last thing they're thinking is: "Let's grab the person's wallet, their shoes, their clothes and make arrangements for their return home."

This is the level to which the B.C. Liberals have reduced public health care in rural communities all throughout the province through their misguided centralization of services into regional hospitals.

Then, in April 2012, another communiqué from the IHA. Now it says: "We have developed an interim plan, to be put into place May 1, which we believe is the best option for Princeton area residents." So already now, as of May 1, 2012. "The emergency department will be closed between midnight and 8 a.m. four nights a week, Mondays to Thursdays" — for at least a year or more. It says right here: "…may need to be in place for approximately one year while longer-terms solutions are sought."

[1605]

Again, the Liberals intend to actually install — it's already been installed — a telephone at the hospital entrance, so anyone arriving at the hospital will have the ability to call 911. That's the situation that's there right now.

I'd like to ask the minister: is it true that the B.C. Liberals are now planning to close the Princeton ER five nights a week, instead of the four nights in the communiqué, at least for a year or more?

Hon. M. de Jong: Let's assess the situation in and around Princeton General Hospital — a hospital that services, I think, about roughly 5,000 people. Not all of them live in Princeton, of course, although I might point out that far more live in Princeton today than was the case 12 years ago, thanks to some additional economic activ-
[ Page 12117 ]
ity that is taking place, which of course is good news for the community.

Here is the situation that the health authority is confronted with. It is delightfully entertaining, as always, to hear the hon. member speak about these matters and decisions as if they were the product of some cold, calculated political level of deliberation. What's disappointing is that he knows that's not true. He knows that's not true, and yet he persists in what I can only surmise to be crass political reasons to suggest that.

The Ministry of Health — let alone the Minister of Health, let alone the cabinet — has made no such decisions, and it is incorrect for the member to suggest otherwise. What the Interior Health Authority has done is tried as best it can, in an entirely non-partisan way, to address some challenges that exist. Most of those challenges relate to physician recruitment issues.

There are three practising physicians in Princeton. Now, the member has taken some time highlighting to the committee how knowledgable he is about the circumstances in Princeton, and how that health care community is being, apparently, bled dry of resources. He didn't, by the way, disclose to the committee what those three physicians made in 2010-2011 on a fee-for-service basis. Presumably, if he is correct and the health care services in Princeton are being bled dry, that would reveal itself in a lack of funding for either that facility or the people that work there.

I can disclose this information to the committee because there's nothing private about it. It's set out in the public accounts. The three physicians working in Princeton in 2010-2011 earned $398,400, $476,420 and $430,800.

[1610]

So to suggest, somehow, that there is an issue around the funding of the primary caregiver in the guise of the doctor is simply inaccurate and untrue. In fact, the challenge has been to try and attract additional physicians to Princeton, because only two of the three I've mentioned are prepared to provide ER coverage.

In this forum, I would suggest this. It is fair, first of all, for the member to offer criticism of where he believes the government has come up short in its efforts to address the needs of his constituents and, in this case, the people of Princeton. But it sounds like the member has a magical solution that he is simply awaiting the opportunity to implement.

Maybe he does. Maybe in identifying the failure that he has characterized — the failure which, presumably, reveals itself in the inability to attract an additional ER physician to Princeton — he has an answer for that, and it is, he would submit, our failure for not having acted on it.

He has a choice. He has a choice today. He can share that solution with us, with me, and say: "But for the government's unwillingness to do this, we would have solved this problem." I'm interested to hear that. Apparently, the member has a solution to the physician recruitment challenge that has plagued Princeton. I'm certainly anxious to hear it. I suspect 5,300 residents in and around Princeton are anxious to hear it. So let's have it.

I may respond by explaining why I think that solution is of limited utility. I may dispute the solution. But the member's submission can only lead to the conclusion that he has the solution. The solution, apparently, does not involve the $200,000 in additional funding that was made available to retain additional ER coverage, the $200,000 that Princeton has decided to make available for additional locum coverage, electronic scheduling and, by the way, the rental of an apartment for $44,000 so that if a locum comes to Princeton, they've got a place to stay.

None of that, admittedly, has been enough to solve the challenge. But if the member wishes to be taken seriously in these deliberations…. Maybe he does; maybe he doesn't. If his purpose is to simply come in and cast some allegations and make some assertions, that's fine. But if he wants to be taken seriously and he has a proposal for what would be required to address a physician supply problem in Princeton that has admittedly led to some limited closures….

By the way, I don't know where he is getting this material about expanded nighttime closings of the ER. If he wants me to take that assertion seriously, he should tell me where he got that material from, because I am aware of no such plan. Let's have a productive conversation about where he feels some of the solutions lie. If it's just going to be an exercise in "the government is bad; we're good," then we can have that conversation too.

H. Lali: I think the minister just likes to hear the sound of his own voice. He's skirting issues in a typically Liberal fashion. He's talking about doctors' pay. I never asked the member about doctors' pay, first of all.

[1615]

Secondly, typical Liberal fashion is to blame others for the problems that they have created and to try to belittle anybody who asks questions on behalf of their constituents and patients that live in Princeton and area. To try to belittle and blame others — how typically Liberal it is for the minister to be able to do that.

But I will give the minister this much, and I'll use his own words that he's put out there. Princeton is "being bled dry." And the minister…. That's his job as minister — to help solve the problems for people in communities like Princeton and others in other small towns. That's his job. The highly paid folks at the IHA — it's their jobs to find solutions, not to turn around and say to the community, "You tell us how we're going to do this. You tell us," or to say to the member of the opposition: "You tell us how to do this."

That's what they like to do — blame others and throw the issue back at them. How typically Liberal that is, not taking any kind of responsibility for the problems that
[ Page 12118 ]
they have created and yet at the same time not providing any answers — when it is the minister's job.

All of the folks that are hired at the IHA — it's their job. They're getting paid $300,000 or $400,000 or $500,000 or $600,000 — whatever it is. It's their job to find those solutions. Otherwise, why are we paying them? Why is the public paying them that much money if they can't find those solutions?

He talks about doctor shortages. It's not just doctors not wanting to come to small communities, or health care professionals. There's a reason for that. Health care workers, professionals, the folks that provide health care — doctors included and nurses — spend a lot of money, tens of thousands of dollars, to go and get themselves a university education so they can come back to communities and practise what they've learned, what they've spent years learning at universities across this nation and across other countries as well.

When those services that they're supposed to deliver are deliberately pulled out by this Liberal government and centralized into the Kelownas, the Kamloopses, the Abbotsfords and the other regional hospitals in British Columbia…. One wonders why those folks want to come to a community where they can't practise what they've learned.

Instead of saying, "Well, it's a doctor shortage…." These problems are created by deliberate Liberal policy that the minister refuses to take responsibility for and instead tries to push back onto anybody that asks questions on behalf of the communities and to push back onto the communities. That's what the minister is doing.

When these changes were announced a couple of months ago, Princeton was actually given 28 days' notice of the ER closure. There was no consultation. It was an arbitrary decision made on the part of the IHA, and letters were presented in front of the community to sign off on. I mean, that's the kind of way that they do things.

I'm asking legitimate questions on behalf of my constituents. In a recent job posting Princeton General Hospital was called "Princeton health center." That's what it said in there. So I'd like to ask the minister: are the B.C. Liberals planning to further degrade health care services at Princeton General and downsize to a clinic — or even to close the hospital in Princeton?

Hon. M. de Jong: Just to cut to the chase on the member's question, and I'll try to say this slowly so that not only will the skilled personnel at Hansard be able to record it clearly but even the hon. member won't be able to misconstrue it.

There are no plans to close Princeton. None.

I regret more than the member could possibly know that my invitation to engage him in a constructive conversation about how he believes improvements might alleviate the challenges faced by the folks in Princeton and surrounding area somehow represents an abdication of my responsibility or some other nefarious pact.

[1620]

If the member believes that a particular service should be returned to Princeton, then presumably, this is the forum where he would make that assertion. He would, first of all, criticize the minister and the government for the change that has been made and then say: "In my view, the challenges that we face would be alleviated if you were to do the following. Will you?" That's advocacy. That's constructive advocacy on behalf of a constituent or constituents. That's not what the member has done.

I could go on at length, but I will say this. I don't know how the member construes my statement acknowledging that there are challenges at Princeton as somehow representing a blame game. It's an interesting employment of the dialectic on the member's part that when an individual stands up and acknowledges that there are challenges in a particular area somehow that represents a blame game. And I don't imagine there's anything I can say today to dissuade the member from that approach.

We are going to continue to work with the health authority and the folks in Princeton to ensure that the very best service possible is available, that we are attracting the professionals necessary, using all of the means at our disposal.

Again, I implore the member, if he believes that there are mechanisms or means available to government that have not been deployed to assist in that regard, make that case. Make that suggestion. I will undertake to provide as candid a response as possible. It might not be a response he likes, but then the people of Princeton will have the benefit of knowing that as well.

Instead, regrettably, what I've heard is a series of ill-thought-out allegations containing virtually nothing — no, that's an exaggeration — absolutely nothing in the way of constructive contribution to addressing the issue.

Now, I regret, hon. Chair, with the committee's indulgence, if we might stand down for….

H. Lali: I've got one quick question. That's it.

The Chair: Member.

H. Lali: Thank you. Well, you know the minister likes to play with words. The minister likes to put words in other people's mouths that they haven't said. The minister continues to belittle members asking legitimate questions on behalf of their constituents.

I'll make a quick question. I know that folks have asked for a break.

I know that there are figures that the minister cited in terms of pay for doctors in Princeton. I've got a question to the minister regarding administration. Could the minister tell me and tell this House how many people in administration in the IHA are…? I'm going to give him two benchmarks. How many people in administration
[ Page 12119 ]
in the IHA — and I'm not talking about doctors — are making $200,000 a year or more? And how many people are making $150,000 a year or more in administration?

I ask this question because I know there are facts readily available in terms of pay for doctors, and obviously, the minister ought to have that information available for all those highly paid folks that work in the administration, with the two benchmarks — $150,000 a year or more, $200,000 a year or more.

Hon. M. de Jong: The short answer is yes. It's publicly available now. If the member wants me to compile it for him, knowing as I do how busy he is, I will endeavour to do that for him.

I wonder if we might stand down for five minutes.

The Chair: The committee will have a short recess for five minutes.

The committee recessed from 4:25 p.m. to 4:38 p.m.

[J. Thornthwaite in the chair.]

L. Popham: I was encouraged to hear that the minister went on at quite a long length with the last member who was asking questions, that he doesn't want to just hear about problems, but he wants to hear solutions. I think the minister will be quite encouraged because I've brought forward solutions to problems.

I'm hoping that from the indication last year….. When we discussed the issue of Lyme disease, the minister showed compassion and I think authentic concern around the issues that I brought forward.

This is an issue that has been brought forward by myself, representing Saanich South, and the former MLA for Saanich South, David Cubberley. You might wonder why Saanich South comes in representing Lyme disease. One of the reasons is because we have constituents who are suffering from Lyme disease. Also, an area of Saanich South was identified as a hot zone for Lyme disease because of tick contact.

I think last year we went over the doctors' survey that was done in 2008 and the Schmidt report. The information that came from those reports was encouraging as far as moving forward with solutions for patients with Lyme disease.

[1640]

That's because there was a recognition that doctors didn't necessarily recognize the symptoms for Lyme disease — one of them being a bull's-eye rash. Even though a rash and other symptoms of Lyme disease would present themselves, the patients were still required to take a standard B.C. test for Lyme disease. In the year that we were looking at, 13 patients came back with positive results from this test for Lyme disease. In fact, doctors actually diagnosed 221 cases of Lyme.

The tests that are done in the United States are more reliable as far as testing and finding positive results. In B.C. the test is not working. The test is not working, and patients are now forced to go to the States to get proper testing and pay for antibiotic treatments to deal with their Lyme disease diagnosis.

But in a lot of cases these patients aren't going over to the States. They're staying in B.C., and they're developing chronic Lyme disease. I think the minister can agree that chronic diseases are costly for our health care system. We don't want to get to the chronic phase.

My solution that I'm bringing forward is a request, as it was last year, but it's almost a plea now that the minister would consider using a different type of test for diagnosing Lyme disease. Can the minister comment on that?

[1645]

Hon. M. de Jong: I say in all seriousness I do appreciate the fact that the member has come before the committee and said: "I have a concern, and here is what it is" — as she did last year — "and here is my view on what a possible solution to that is." I think that's a constructive manner in which to utilize the forum we have. It is, I understand, also appropriate for the member to point out her critical assessment of what the government has done, and that, too, is appropriate here.

I'm going to begin by re-emphasizing my view that the history associated with this is one where I think one can fairly say there has been a history of underdiagnosis. I wouldn't purport to be able to explain precisely why that is so, except to say that I am inclined to be satisfied that that is so. There have been, undoubtedly, impacts for anyone for which a condition has gone undiagnosed for a period of time.

One of the challenges today, as the member has highlighted, relates to test or diagnosis methodology. Now, in the few minutes I just took with the provincial health officer, he endeavoured to summarize for me where the tension exists between the methodologies employed by the Center for Disease Control in Atlanta and the one favoured by the national laboratory in Manitoba, and the U.S. testing methodology that the member has referred to.

If I endeavour to act as a conduit for that explanation, I will undoubtedly not do justice to it. So it's fine for me to say that the CDC, Center for Disease Control, and our national laboratory in Winnipeg believe that the methodology employed by the U.S., the testing approach that the member has referred to, in their view, for a complex set of scientific reasons, results in a disproportionate amount of false-positive testing. I am in no position to defend the scientific argument behind that assertion.

What I would like to do, if the member is prepared, is to arrange for a direct conversation between her and the provincial health officer so that they can have that discussion. Then she will at least have the benefit of the detailed explanation for where the differences lie. I'm not
[ Page 12120 ]
certain that will alter the member's view or her position on what the solutions going forward will be. But she will then have access to the same information that I have and that the government has in terms of influencing the test methodologies.

There are also the questions that we talked about, the last time we sat down in this forum, around the establishment of the chronic disease centre — the clinic and research centre at B.C. Women's Hospital that has now moved forward and now has a home — and the establishment of a community advisory committee which may also have a role to play in this. But I'll leave that, because the member may have something else to say about what we've just talked about.

L. Popham: Thank you for that answer. Of course, I would always appreciate the opportunity to sit and discuss this issue, but my understanding of the test I think is quite good. The test in B.C. doesn't have the same broad spectrum that the test in the U.S. has, and therefore, I believe that what the test in the U.S. picks up are other things that indicate that Lyme disease is most likely present.

[1650]

I think that's a good way to move forward when trying to treat a disease that is so debilitating to people and so costly for our health care system. I don't understand why we can't change our standards. It does seem to be a problem, because this is a conversation that's been ongoing. I understand there could be science against science. But the fact of the matter is that there were thousands of tests given, and 13 showed up positive. Yet doctors were diagnosing Lyme disease in greater quantities than that.

Unfortunately, when we have this month, which is Lyme Disease Awareness Month…. Those are the indicators that are put out as far as information releases around Lyme disease and how dangerous it can be to people living in British Columbia. VIHA, for example, put out an alert that it was Lyme Disease Awareness Month and how one might prevent Lyme disease, which is very good. But also in one of the lines it said it's very rare in B.C. I don't think that's something we can say anymore. I think there are doctors diagnosing it.

As far as doctors knowing what to diagnose, I think we're getting a little bit better there. But I think there could be a lot more information given to doctors so that they're more aware of it. In that case, you might even see a greater diagnosis. Of course, I'm always interested in sitting down and discussing it.

The clinic that the minister mentioned…. This was quite a big announcement, and I think it was an indication that Lyme disease was present in British Columbia, which was hopeful to people who are concerned about it and people who have Lyme disease. This is what my understanding is around the clinic right now, and the minister can certainly correct me if I'm wrong. I don't think there's a clinical director that's been hired at this point. That might be expected by late summer, but not at this point. So there are no timelines to which the clinic would be seeing patients.

This is a clinic that also deals with a lot of chronic diseases, so it's not specific to Lyme. I don't know where the focus on Lyme will be. Because the timeline has already been two years, we've missed our chance two years in a row to diagnose some of these patients who are possibly going to end up with a chronic disease. It stops their lives. It stops them from leading positive lives. It's a terrible disease to get.

I guess I would like to know how focused the minister could be on Lyme disease. Is it an annoyance? It's been brought up so many times. After the minister's response last year, I was so hopeful that we could have moved so much further ahead. I'd like to have a commitment from the minister that he will take this seriously and perhaps learn as much as he can about the two types of testing. I don't think we're at the point where we need to argue anymore about which test is better. It's clear that the B.C. test is substandard.

Hon. M. de Jong: To the final part of the member's submission…. Well, the final two parts. First of all, based on the reading material and having met with the individuals, I do have a great deal of sympathy and concern for people diagnosed with a chronic ailment that has suffered a bit of a dubious or mysterious evolution.

[1655]

The dilemma is this. The member, who I know has undertaken a great deal of work on her own volition, has concluded that the B.C. test is substandard to another test methodology — and it is, I'm sure, helpful to have come to that conclusion. That is not the advice that we are receiving.

The member can, and I know does so constructively, make that submission that, on the strength of the work that she has done, she is satisfied that the B.C. test is substandard as compared to another option.

That is not the conclusion of the Center for Disease Control. That is not the conclusion of the national laboratory in Winnipeg. That is not the conclusion of the office of the provincial health officer.

What I won't do is say that the member is wrong. What I have to say is that the government, the ministry and the minister get very contrary advice and information.

It's like the person — at the risk of mixing issues — who came to me, and maybe has come to the member, and made an impassioned plea around the ill effects of cell phones and cell phone towers. Look, they are not being mischievous. They believe it. They have read stuff, and there are terrible things that are going to happen.

I am obliged to say to them — not that they are wrong, because it wouldn't be the first time that science evolves, and 20 years from now there is an accepted level of….
[ Page 12121 ]
What I'm obliged to say to them is that the advice I as a layperson am receiving — from the clinicians and the health officers that we ask, on a non-partisan basis, to provide advice on these matters — is saying the following.

I am loath to substitute my opinion — or, in fairness, the member's opinion — for that advice, because I'm not sure how I would defend it to those who argue the other side of the equation.

Returning to the clinic. I just received confirmation of the information I had earlier that the process of recruiting the director is in the final stages. The hope is that the clinic will be up operating in July or August. That's taken longer than one had hoped it would, but on the positive side, the commencement of work there is now near.

I will say this. I think the member, I think her predecessor and I think the people that have made it their objective to raise the awareness of Lyme disease and the devastating impact it has on people have done a good job.

If this was at some point in time in Canada an annoyance or an issue that public health officers sort of dealt with as a…. It is no longer. They are fully seized of the issue and the argument around the methodologies by which we diagnose the disease.

Perhaps to my own detriment, I say to the member: "Don't give up." I know the passion with which she approaches this will facilitate the meeting.

[1700]

If the member is successful at causing a change of view or opinion on the part of the provincial health officer or any of the other agencies that I've mentioned, I'm sure I'll be the second to know. That will certainly impact our approach.

L. Popham: Thank you for that answer. I understand the position that the minister is taking. Fair enough.

If it is a science-against-science approach, I guess my request, with our new clinic that's starting up, is that perhaps a pilot project could be undertaken which compares both types of testing so that we can see science against science in real time. I think that's fair.

I think that if there are statistics coming to the minster from the authorities that are advising on the type of testing that we accept in B.C. and in Canada, then there shouldn't be any problem with doing a pilot project that compares both types of testing. Then, I think, that's a more fair and even playing field.

Hon. M. de Jong: Interesting question and suggestion. Maybe the positive feedback I can offer the member is that, in just speaking with Dr. Kendall, we hope to go beyond that.

I am reminded the scientific debate that lingers around the existing test methodologies…. Neither employs a reliance on genomics, which may yet prove to be the most reliable, or a far more reliable, way to diagnose.

Having made that statement, I'm in no position to suggest the accuracy of that statement, except to know that in a variety of other areas, I see the tremendous work being done in genome sequencing and what that has meant for diagnosis in other areas.

The centre as a place to assess testing methodologies, as the member has suggested — I think that's an entirely valid observation.

J. Kwan: I thank the member for Delta North for letting me butt in to ask my question of the minister. I think it's a relatively easy one for the minister to look into or have his staff look into and, hopefully, find resolution.

Before I do that, let me also just thank the minister and his staff for resolving the other case that I brought up the other day for my constituent. The minister's deputy has advised me that a solution has been found, and I appreciate that as well.

In this instance, this is a case that actually dates back to last year with a constituent who is under the provincial nominee program. This particular constituent's medical services coverage was interrupted for the period of May 1, 2011, to January 2012, where he then had to pay for that coverage.

We have raised the issue to the ministry staff in trying to attempt to resolve the issue. After much back-and-forth involving the federal government, with Citizenship and Immigration Canada, we discovered that the constituent was granted a work permit as part of the provincial nominee program in November of 2008 and had applied for a renewal of this permit prior to its expiration, in December of 2010.

[1705]

As a result, there was some sort of delay in the process of the application for the renewal due to an error that was made by Citizenship and Immigration Canada in processing the renewal application. Specifically, what happened was that the Citizenship and Immigration Canada agent who processed the application rejected the application on the grounds that it did not contain a labour market opinion.

A labour market opinion is not actually required to be submitted for provincial nominee applications in this instance. Because of that mistake, by the time he got his provincial nominee status, the paperwork that came back from Citizenship and Immigration Canada stamped it to say that his provincial nominee program was restored.

When that then got processed in the Health department, they deemed that because it was deemed to be restored, he's therefore not eligible for MSP coverage during that period.

In fact, he never had his work status revoked at any point in time. This is an ongoing mistake of lack of understanding around the situation or something. We've written to the ministry staff around it and attached all the various documents, along with the consent and so on.
[ Page 12122 ]

Recently, on April 16, I got a response back from the ministry basically saying that he could appeal the decision to have his MSP coverage if the constituent in fact incurred financially devastating medical costs during his wait period.

That didn't happen. It's just that he never should have been charged the MSP premium coverage cost. He should have been covered. The mistake was actually from Citizenship and Immigration Canada, which processed his application to say that he needed a labour market opinion with the application.

We have that information from Citizenship saying: "Sorry, we made a mistake. You don't need the labour market opinion." Therefore, we're asking the ministry to provide him the medical coverage that he should have gotten. The constituent has had to pay out of pocket to resolve this now, but he never should have had to.

I don't know where else to go with this, except to bring it to the minister's attention.

Hon. M. de Jong: I know the member will provide all the material, but I'm a bit curious about this. I tried to write down the dates. What is at stake? What has been the prejudice to the constituent? Is it the MSP premiums they paid during this period of time? I'm trying to get a sense….

Here's what will happen on occasion. Coverage will be discontinued by MSP. The individual will incur a catastrophic event requiring medical treatment and will be charged for that treatment thousands — sometimes tens of thousands — of dollars and will appeal on the basis either that they should have had coverage or that they seek relief from the policy that says they don't have coverage.

It doesn't sound like that's the case here. I'm just trying to get a better sense of what the prejudice has been to the individual. Was it the fact that they paid premiums at a time they didn't have coverage or that they paid premiums….? That's the part I don't understand.

J. Kwan: From the period of May 1, 2011, to December 31, 2011, he was charged MSP coverage. His coverage was ceased and stopped because he was deemed to be ineligible for the coverage. Of course, he also incurred medical costs in that period as well.

The point I want to say is that for that period, his coverage should have continued because in the processing of his application, a mistake was made by Citizenship and Immigration Canada. That mistake has now been identified. Therefore, for that period he should not have to pay for that coverage. That's what I'm trying to say to the minister.

[1710]

Hon. M. de Jong: Does that mean that what is at stake here are the premiums that he paid between May and December of 2011? That's what I'm finding curious. From the point of view of the Medical Services Plan, if someone was paying premiums, why wouldn't they be covered? Were they paying premiums and then being told that their expenses for medically covered services weren't being covered?

J. Kwan: He was charged to pay for the premiums because it was deemed that he was ineligible to get MSP premium coverage. So he had to pay for the medical coverage during that period.

Hon. M. de Jong: The premiums or the services?

J. Kwan: Both.

Hon. M. de Jong: We'll look at it. I will say this: I'm not sure it follows automatically that if you're on the provincial nominee program, you don't have to pay MSP premiums. There are the waiting periods for when you arrive and all of those things. I'm not certain about this, but if a provincial nominee arrives pursuant to that program, after a certain period of time they would be eligible to apply for MSP coverage. They would then begin paying for that coverage and would be covered.

Probably the best thing is to get the material. If I, or we, have additional questions about what the…. I'm still a little unclear on what the relief is. Is the individual looking for a refund of the premiums that were paid? What's the order of magnitude here? How much are we talking about?

J. Kwan: I'm sorry. I actually didn't bring that piece of the document, around the cost of it. I will bring that to the minister. I have six attachments around this to show the case, to indicate that he shouldn't have had to pay for the coverage. When he was under the provincial nominee program, before he had to have the renewal, he was covered — right? That should have continued for that period.

It's just that processing period where he wasn't covered, and then he had to pay out of pocket for that cost. That's the period which I'm trying to rectify here.

I will bring the documents to the minister on that. The issue is not so much around the financial hardship or anything like that. It's just that he was qualified all the way through, and because of that interruption and the mistake made, it was deemed that he was not qualified, and therefore he didn't get coverage.

Sorry. I'm getting the evil eye from my colleagues.

Hon. M. de Jong: And I won't add to that dilemma, except…. Actually, I won't. I'll happily receive the documentation.

G. Gentner: Quickly back to whooping cough. One last question I was trying to ask. I know that some of the
[ Page 12123 ]
problems have stemmed from up-valley, up by the Hope area, and we're now looking at the First Nations health authorities.

Can you explain to the House how your ministry monitors immunization within the new First Nations health authorities? What are the roles of the public nurses? Do they need permission to go? Do you have a percentage — for example, in the Fraser Health Authority — of how many First Nations children have been immunized?

[1715]

Hon. M. de Jong: I guess the first thing I would say in response to the member's question is that it is, for a variety of reasons, probably more appropriate to refer to a liaison relationship between the health authority and the First Nations than a monitoring role. We don't monitor or check up.

We're in an interesting time, because we're in the transition between a time when Health Canada was the primary delivery agent to where we are increasingly seeing the shift pursuant to the tripartite aboriginal health accord taking shape, where operational responsibility will shift to First Nations via the aboriginal health council and the aboriginal health authority.

So the liaison will occur at that level. Operationally, it exists. I will say we are still in the early days of the formation of the aboriginal health authority and the health council. The liaison work is ongoing, and it will, I think, represent a fascinating aspect of the landscape going forward.

I'm glad the member asked. This is a significant shift — the first of its kind in Canada. I can alert the member when I meet with colleagues at federal-provincial meetings. There's a great deal of interest nationally in what this shift represents.

G. Gentner: Well, we're all looking forward to it. That on-the-ground type of local involvement is, I think, welcoming. But we can liaise all we want. However, this is something that's airborne, and we need a rapid response once in a while. I hope we'll be able to work out those difficulties, in particular for the kids up the Fraser Valley.

Colorectal screening. I want to ask a few questions relative to that. My understanding is…. Correct me if I'm wrong. Can the minister describe…? Is there not a pilot project that the ministry is currently running to investigate this? Has the ministry done a comparative relative to the cost savings regarding early detection of this?

Hon. M. de Jong: A bit of an update, then, for the member and the committee. There was a pilot. I guess some context, by the way. The reason it's a particularly appropriate issue for us to be addressing here is that colorectal cancer represents the second-leading cause of cancer death for men in B.C., and we are advised that the prospects of survival are over 90 percent if detected at its earliest stages. So there does seem to be a strong case for some manner of screening.

[1720]

The pilot was commenced by the Provincial Health Services Authority. The objective was to assess a programmatic, population-based screening and how that could be delivered in the province. That took place in Penticton, Powell River and a small part of Vancouver — Penticton and Powell River since 2009 and a small part of Vancouver since 2010.

The B.C. Cancer Agency has completed its evaluation report on that pilot and has submitted that to the ministry. We are reviewing that report. The pilot is being maintained in three communities: Penticton, Powell River and Downtown Eastside of Vancouver.

What we are in the midst of doing, I'm advised, is working with the B.C. Cancer Agency and Provincial Health Services Authority to determine the most effective way to increase colorectal screening participation in B.C.

I'm told, as well, that there is, again, a healthy debate on some of the testing methodologies, and that will comprise part of the discussion that takes place leading to decisions about how screening would be conducted moving forward.

G. Gentner: For the record, is the minister suggesting that the ministry is looking at a provincewide screening program the likes of Ontario?

Hon. M. de Jong: We are looking at it. I don't know enough about the specifics of the methodology employed in Ontario to comment specifically on its similarities or dissimilarities from Ontario, but we are actively engaged in examining what a provincial screening program would look like. I rather suspect that the officials engaged in that are examining what is taking place in Ontario.

G. Gentner: One further question on this, if I may. The minister is correct about the second most common cancer in men. It's also the third most common cancer in women.

Can the minister tell the House when or if its findings from the B.C. Cancer Agency and, of course, the pilot project will be completed, and if they will be tabled in the House or will be available?

Hon. M. de Jong: To the member, I want to be as specific as I can be. The evaluation report completed by the B.C. Cancer Agency is a document that we will make available. I'm not sure I'll need to table it. I can make it available publicly.

[1725]

The other point that I am reminded I would want to emphasize in the course of this discussion is that the screening test is available to citizens now if they wish it — with a physician referral, available free of charge via…. Let me confirm that, before I say that again.
[ Page 12124 ]

With a physician referral, it is available to a citizen, free of charge.

G. Gentner: I would imagine that's got more to do with the physician believing that you're at risk.

On another matter, when does the ministry plan to publicly fund the availability of the HPV vaccine for males?

Hon. M. de Jong: What I can tell the member is that I'm advised there is a national group examining the question relating to coverage for the HPV vaccine generally and also with particular reference to males. That work has not been completed. I'm not in a position to offer a direct response to the member without first having had the benefit of the recommendation from that national group.

I think I heard the member advocating for that. I'm not in a position to confirm for him that that will happen. We'll need to await the recommendation from the national body studying the matter.

G. Gentner: Sexual health is an important part of our society, and the immunization of boys between the ages of nine and 13 has been proven to be effective as a preventive health strategy.

I'm asking the minister if he can tell us what mechanisms are in place for the ministry or other provincial health bodies to monitor the effectiveness of this vaccination program and if the ministry is involved in awareness programs so that all families understand the importance of this immunization.

[1730]

Hon. M. de Jong: The direct answer to the member is that British Columbia is, at the moment, in partnership with Quebec, leading an analysis of the effectiveness of the vaccine with respect to girls, women. We are not, at the moment, engaged in a similar analysis dealing with males and are relying to this point, for information in that respect, on the work being conducted by the National Advisory Committee on Immunization.

G. Gentner: Well, I'm just trying to find if there are some performance criteria that the ministry is using to see exactly the success of the program. It's been underway, I think…. It was provided for all girls of certain ages, as we've sort of been moving forward with this vaccination. Has the ministry set targets of how many girls should be vaccinated yearly, and if so, how are these targets measured?

Hon. M. de Jong: A target has been set. The target is 85 percent of girls. I'm advised by the provincial health officer that we are presently at approximately 66 percent, based on the best available data.

G. Gentner: I presume that's girls that are pre-puberty.

Hon. M. de Jong: That is so.

G. Gentner: Hepatitis B immunization. HealthLink B.C. has given proper notice that in some ethnic communities untreated hepatitis B is creating a chronic health issue, mainly because many come here and the children have not been inoculated. I'd like to know how the minister is dealing with this and if there is a program to target at-risk ethnic communities in the province.

[1735]

Hon. M. de Jong: A couple of different ways in which the government, the health authorities, the ministry engage to try and address the phenomenon that the member has described.

First of all, I'm reminded by the provincial health officer that all infants, of course, in B.C. receive the immunization. Then there is a grade 6 booster program, so any families arriving from elsewhere in the world into British Columbia in the intervening period would be captured at that stage — children entering grade 6. And there is provision for identifying young children in preschool and daycare settings.

In addition to that, however, some specific initiatives have been taken. This past April SUCCESS, which is an organization I believe the member is well familiar with, announced a renewed focus on addressing the impact of hepatitis B on ethnic communities in B.C. That involved a partnership with the B.C. hepatitis program and the department at UBC, and they have formed the Hepatitis B Medical Advisory Committee. They are launching a second hepatitis B awareness survey, and they are working with the government around the delivery of resources to educate around the hepatitis B virus.

I should also alert the member to the work being undertaken by iCON, the intercultural on-line network. I've participated in a couple of the seminars that are undertaken by that organization, again, with a specific reference and focus on educating ethnic communities within British Columbia as to chronic disease and the steps that can be taken to prevent chronic disease. That, too, is a forum where these matters are discussed.

G. Gentner: Does the minister plan to include hep B on the list of the chronic disease management program?

Hon. M. de Jong: Just to be clear, does the member have a particular program in mind or just generally?

G. Gentner: Generally.

[1740]

Hon. M. de Jong: I want to answer this as candidly as I can. The rate of new hepatitis B infections has, I am ad-
[ Page 12125 ]
vised, dropped from 5.7 cases per 100,000 in 1997 to 0.2 cases per 100,000 in 2010, meaning hepatitis B remains a feature on the landscape, but thanks to aggressive vaccination programs and education initiatives it is, by far and away, a reduced threat on the landscape. We want to keep it that way.

It will remain a feature in our conversation around chronic disease. At the same time, I don't want to suggest that it will lead the way. You will probably see us speak more about things like diabetes and heart disease whilst acknowledging that hepatitis B remains a reality against which we must guard and take precautionary steps, which the immunization program represents.

G. Gentner: Well, it's the season of the mosquito, and we know that we had this big fear years ago about West Nile coming about. We've only detected the virus, I think, once or twice in British Columbia.

Is there a sunset clause here? Are we not as concerned as we were before? How is the ministry addressing this potential fear and the West Nile virus?

[1745]

Hon. M. de Jong: I'm trying to summarize the relevant information for the member as best I can. It may provoke some additional questions.

B.C. Centre for Disease Control continues to work with the health authorities, with the Canadian Wildlife Service, Ministries of Agriculture and Environment, UBCM to implement control activities, surveillance activities during the mosquito season. There has been significant funding provided to UBCM for spray programs. Most recently, last summer an additional grant of $2 million was allocated to UBCM.

Here's the information that may be more pertinent to the assessment of where the risk lies. In general, West Nile virus activity in B.C. has been low. The B.C. Centre for Disease Control tells us that the first detection was in the late summer of 2009. There were two human cases of West Nile fever, what are termed "non-neurological." Subsequent testing found ten positive mosquito pools in the same area of the South Okanagan. Three horses tested positive that year — two from the Okanagan and one from the Fraser Valley.

In 2010 there was one human case in the Central Okanagan and five positive birds from the same area.

Of course, as summer arrives, as it appears it may actually do, we do try to provide informational material to the public to remind them of the precautionary steps they can take to lessen even that relatively remote risk.

G. Gentner: Hand hygiene. The Auditor General came out with a report way back in 2007. We're now waiting for a follow-up. We have a filed report, and there are still some outstanding issues relative to the infection prevention side.

I'm just wondering how the minister will deal with this, and are the points from the Auditor General's report being incorporated with these new approaches? Can the minister detail some of the ways the health authorities are going to work to improve hand hygiene, particularly in hospitals?

[1750]

Hon. M. de Jong: To the member, his question elicited an immediate and, I would say, positive reaction from the officials that are with me, because he has put his finger — pardon the pun — on an issue that is attracting far more attention than I think most people realize.

It seems odd to be talking about something as basic as handwashing in the context of an environment like a hospital, where one assumes that is a given. Our notion of surgeons scrubbing up is pretty deeply ingrained. The problem is that there is a history of the scrubbing stopping when they venture too far from the OR theatre.

A number of programs have been implemented in a general way, and we can talk about this in more detail if the member likes. A tremendous amount of institutional resource is being devoted to the auditing of handwashing. You can imagine interesting methodologies being developed about how to track that amongst doctors, nurses and support workers.

The results of those audits are now posted in hospitals. I don't think they're posted on line yet, but they are posted in hospitals. In some instances health authorities have contemplated the possibility of issuing temporary penalties, privilege penalties for people who fall short of the standard in terms of abiding by the handwashing protocols.

It's one of those things. You say it and sort of smile to yourself. But it is the single biggest contributor, I am told, to the transmission of bacterial-based disease. We've obviously talked a great deal over the last period of months around things like C. difficile.

The focus on this is no joke. The money being spent on promoting the protocols and tracking adherence to the protocols is very real, and it is being done because the benefits of this kind of a focus on hygiene have been quantified and the costs associated with not are also very real.

[1755]

G. Gentner: Can the minister tell us the costs of the enhanced cleans done at Burnaby Hospital, Royal Columbian Hospital, Surrey Memorial Hospital, Peace Arch Hospital and Langley Hospital.

Hon. M. de Jong: I presume the member's reference to the enhanced cleaning…. The term that I saw is the "deep clean." I think we're talking about the same procedure. They take place at the hospitals that the member has mentioned. They are an annual feature of the hygiene program.
[ Page 12126 ]

In the case of Burnaby Hospital, there was the specific recommendation from the Gardam report and the Cochrane follow-up. I don't have a number at my fingertips. Probably the most accurate number I can give, because it was an additional procedure, would be…. We do have access to a cost figure for the Burnaby deep clean that happened, I think, two months ago. I'm happy to try and…. Here it is. I'm told it was between $400,000 and $500,000.

G. Gentner: How much has been paid to Aramark in the form of bonuses since the company took over cleaning in the FHA? Were there any penalties applied, and if so, how much did that amount to?

[1800]

Hon. M. de Jong: The three things I need to verify before I can give the member a specific and meaningful answer are, one, to confirm that Aramark has the contract for all of the facilities that the member has mentioned. I think he referred to all of the facilities, hospitals, in Fraser Health. I believe that is the case, but I'd need to verify that.

I'm not familiar enough, off the top of my head, with the contract signed by Fraser Health to confirm whether or not there is a bonus provision included within. Nor can I tell the member with certainty in the past 12-month period, if there are bonus provisions, whether they have been met and satisfied or, if there are penalty provisions, whether they have been activated. I just don't have that information, but I will endeavour to obtain it.

G. Gentner: As the meter starts ticking away here, I did go to estimates regarding community and sport, and I was asking about this phenomena — I guess we're doing more diligence in the area — of prevention of concussions in sports and particularly minor league hockey. The minister referred me to the Ministry of Health. You are the lead on injury prevention. Of course, SportMedBC and ThinkFirst B.C. are involved, and the B.C. Concussion Advisory Network.

I would like to know: what is the funding towards this? Secondly, I'm more interested in what strategies — and they could be collaborative — is this ministry doing in the prevention of injuries in sport as opposed to basically treating it after the fact?

Just for the record, we do know that the member for Vancouver-Langara has put together a private member's bill on this issue as well, and it's still on the order paper.

Hon. M. de Jong: We have certainly seen public attention focused on this matter. It's interesting that that focus has derived largely from the fact that there has been this proliferation of concussion-type injuries, head injuries, in our national sport. That has drawn attention.

[1805]

Let me say a few things about that. We as a government were the first province to provide funding to the Canadian Standards Association, CSA, to perform work in helmet research and helmet standards. There is collaborative work taking place with the B.C. injury research and prevention unit of the B.C. Medical Association.

The member mentioned SportMedBC on the prevention of head injuries. We have provided significant funding to Rick Hansen's foundation. If the member has an opportunity — he may have already done this — drop by there and see the research that is taking place around the development of head protection, spinal cord protection to prevent compression injuries.

I am told that the single biggest contributor to those types of compression injuries now is mountain biking. On a far too regular basis we are seeing people fall prey to very, very serious injuries from that activity.

The good news is that people are doing stuff. I think it's important that we not get to a point where we are urging people back onto the couch. The fact that they are out there, engaged in activity, and physical activity, is a good thing. And I know the member agrees with that. But ensuring that there is protective gear in place and that organizations like the B.C. Amateur Hockey Association, BCAHA, are adopting policies around the rules of the game that protect against catastrophic injuries of the concussion and compression types are all part of the initiative.

Those research linkages exist. The collaboration exists. It is real, but I would still be remiss if I didn't say: "Take the proper precautions. Wear the proper equipment. Be cognizant of the necessity of safety, but don't let the risk dissuade you from engaging in the physical activity that is going to benefit you and provide you with a lifelong fulfilment."

B. Ralston: I want to address the case of Patrick Kelly. I gave notice in writing yesterday. I believe someone would have the file — correspondence between the minister's office and mine. I'll just give you a brief background. I simply have the one question. I just wanted to confirm the minister's response.

Mr. Kelly lives in my riding. He has severe right knee pain. It's a degenerative disease of his knee. Limited financial means due to his medical disabilities have left him on medical disability from the B.C. government. Both his family doctor and his orthopedic specialist have recommended that he needs something called Synvisc injection that would be injected into his knee — one, to relieve the pain and, two, to prevent or stop him from being required to use addictive painkillers.

His doctor says…. I'm quoting from a letter. Dr. Lakhbir Singh is his GP, family physician, a clinical instructor at UBC medical school, Fraser Street in Vancouver:

"Without the Synvisc injection, he's going to suffer irreparable harm to his body. First, the lubricating action of Synvisc will pre-
[ Page 12127 ]
vent further scraping and damage to his bone and knee cartilage. Secondly, the Synvisc will spare him the negative mental effects of chronic pain, which are depression and drug dependence on addictive painkillers. I support Mr. Kelly's appeal for a Synvisc injection to his knee, a $360 cost."

[1810]

The minister and I have corresponded — or, at least, his office — and the response directed by Mr. John Manning, who's an executive assistant, was in a memo dated March 22 of this year.

"Unfortunately, the injections in question are not eligible for PharmaCare coverage. This is not a comment on the value of the therapy but reflects our ability to cover such items within the limits of the available resources."

On behalf of Mr. Kelly, I'm just here to ask whether there has been any reconsideration of this position, or is that the final answer for Mr. Kelly?

Hon. M. de Jong: I do actually recall the correspondence. I may have seen a letter that I didn't sign, if the member didn't get a letter from me, but I do recall the matter in his letter regarding this individual. I also recall the release that was included, so I feel competent to discuss the matter here with the member.

The interesting feature about this is that the particular product — and I won't pretend to always understand the rationale for some of these matters — and these injections that I believe are the subject of the inquiry are licensed by Health Canada for sale as a medical device, not as a prescription medicine. The dilemma is that under our existing PharmaCare policies, that precludes it for eligibility for PharmaCare coverage.

Let me preface my remarks. I can't stand here and tell the member to relay to his constituent that that is all about to change. What I can tell him is that in the bill before the House that has passed second reading — I think, in fairness, with support from the opposition — the provisions of that bill would allow via regulation for the Lieutenant-Governor-in-Council, the government, if you will, to address these kinds of points in a way that is perhaps not presently the case.

There is a fairly expansive definition of "device" and a recognition that technology evolves. Now, that is not a guarantee that that discretionary authority would be exercised in this case. It does mean that there is an embedded statutory flexibility that would flow with that bill that does not presently exist and may allow for a reconsideration of where we presently find ourselves.

M. Farnworth: We are due to rise at 6:30, and that will be the completion of the estimates of Health. But there is one more topic that we would like to cover at this particular point, and that is the issue of international medical graduates.

As the minister is no doubt aware, if he or I attended medical school here in British Columbia, we would graduate, we would have our exams, residency, and then we would be able to get a position somewhere, hopefully.

If we are Canadian citizens and British Columbia residents and we did not go to UBC, for example, or to Prince George but instead studied at an accredited medical school in other jurisdictions — let's say Australia or Ireland, for example — we would not be treated the same way when we returned as someone who studied here who's a Canadian citizen. We would not receive the same treatment in our ability to obtain a residency.

[1815]

Recently a report was done by the member for Vancouver-Langara outlining a number of recommendations to change that policy so that graduates of accredited schools from overseas who are Canadian citizens — in this case, British Columbians — receive the same treatment and access to residencies as people from here.

Has the minister read the report, and is he planning on taking any action on this report? Is the government planning any changes so that British Columbians who have studied abroad are able to practise here in the same way that British Columbians born here are?

Hon. M. de Jong: Thanks to the member for raising the issue, because it is an important one for a variety of reasons. It is an important one from the perspective of British Columbia's communities, many of whom are plagued by being underserviced by the medical practitioners.

It is an important issue from the perspective of at least two other groups: the British Columbians who go abroad to obtain a medical education and return and find that they have difficulty putting those newly acquired skills and education to work; and people who have been trained and practised as doctors in countries around the world and choose to come here and make a new life in Canada and British Columbia and understandably want to work as doctors and find that they encounter all kinds of obstacles to fulfilling that wish and natural desire.

The member has correctly and generously recognized the work of my colleague the member for Vancouver-Langara, the now parliamentary secretary. I asked her to look at this. She has a specific interest, a historic interest, and I asked her to identify where some of these issues lay and what some possible steps might be to address them.

I have read the report in detail. I am very much engaged in attempting to address this. As I said to my colleague, the author of the report, my interest in this stems from the fact that, yes, there are people who have acquired a set of skills and education that, at a human level, you want to address. But the societal interest is that we have a gap. We have communities who need doctors and doctors who want to be doctors. Selfishly, the primary interest is addressing that gap, and along the way, hopefully, fulfilling the dreams of some people that have made an investment.

Let me say this first off, though, because as engaged
[ Page 12128 ]
as I am in that issue, there is something that is not often said that should be said. I say this anecdotally, so forgive me. When I did my undergraduate degree, I got an offer to go to a law school in Hawaii, if you can believe it, on a hockey scholarship — go figure, that hockey hotbed of Hawaii. I'm sure I would have found something to do. The problem was that I wanted to practise law in B.C. I knew that if I acquired a law degree in Hawaii that was going to be a problem.

So the first thing I would say to people is it's really tough to get into medical school in Canada. As a result of that, people who want to become physicians look elsewhere. At least inform yourself beforehand, because the investment is huge, in terms of time and money.

[1820]

Families will spend, in some cases, more than everything they own to facilitate a child getting into medical school somewhere in the world. At least inform yourself as to whether or not there is a reciprocal agreement in place between the Royal College, between the accrediting bodies, so that you're not surprised. That doesn't mean we shouldn't be addressing the issues that remain.

The worst thing I've seen is when a student goes away, puts in their years. Their family is ready to welcome them back and give them the white gown and the stethoscope, and they find out that none of that is going to happen absent a whole bunch of other things. People do need to inform themselves.

Having said all that, there is still this challenge that arises when people go to these schools — some of them very, very good schools; in fact, most of them very, very good schools. They come back, and they run into this issue about how to take the next step. So much of that, it seems to me, revolves around the manner in which residencies are allocated. The advantage that the students who study in Canada have is that they are essentially automatically placed in residency programs.

Now, ironically, the member for Surrey-Whalley is here. That's not the way law school worked. You had to go out and find your own articling position. But the students in medical schools have that advantage of knowing they're going to be placed in a residency program.

The challenge for the international medical graduates — and now I'm talking about the students from B.C. who have gone abroad to get an education and come back — is that there are far more residency positions available now than was the case — it's gone up from six in '03 to 26 — but there's still far more demand.

And there seem to be some systemic challenges. The one that we were made aware of by my colleague in her report is that in order to qualify for the residency, you have to write something called the OSCE. The timing around the OSCE is such that most international medical graduates can't write it.

There should be a way — in fact, I'm convinced there is a way — to address that. What I fear is…. What I want to know is this. I don't think access to the OSCE, that exam, should be used as a way of limiting the pool of people qualified for residencies. I think if people want to write that exam, we should find a way to allow them to do it in a timely way — including, I might add, asking them to cover part of the cost. The member should know that as well.

If making the OSCE exam more readily available — because there is a cost associated with it — involves asking the candidates to assume some of the costs of that, I actually think that's reasonable. Then what we'll have is a pool of candidates for residency that we know meet the criteria.

Now, that will increase the pressure on us to find residencies. But as I have said, we should be imaginative about that as well. I think there are communities out there who are prepared to enter into specific agreements with candidates — service agreements. We have programs in place now that will encourage people to locate in certain areas.

Residencies, though, are admittedly tricky things. You can't locate somebody in an isolated community. They've got to have access to colleagues who can give them training and mentorship.

[1825]

I hope what I've conveyed to the member in this summary is that: yeah, I've read the report. I think the work is important. We're engaged in the work, and I think the stakes are high. It troubles me that we have this reservoir of talent that we are getting better at tapping into but nowhere near as good as we should be at taking advantage of.

I haven't even spoken about that other group, which are physicians who have trained, lived and worked in a country all their lives and then choose to come here. Again, finding a way to verify that they are qualified and then put them to work or give them access to the work that needs to be done I think is also important.

B. Ralston: A couple of comments, because we don't have much time. The B.C. system is different from that of other provinces. The example I've been given is Manitoba. In B.C. if you are a Canadian graduate of a foreign medical school, you have to apply to complete the exam, and then you are required to complete a 12-week program at UBC for international medical graduates which begins in July and goes July, August, September.

What in effect happens is that even if you are accepted, you have to attend that course. This basically means that you can't enter a residency for a year, so it's delayed a year. The way in which the matching program works is if you do apply, you are obliged to accept what is given to you. You don't have a choice.

The argument that's sometimes made in defence of the B.C. program is that people don't apply. They don't apply because they know that their chance of getting a match
[ Page 12129 ]
that they consider acceptable or desirable is very remote.

What's being missed here, I'm told — for example, in the Manitoba system, where they have an open matching program, they take people without this requirement of the 12-week boot camp, if I can call it that, at UBC — is that there are international medical graduates who rank in the 99th percentile. Three examples were given to me: someone from Terrace, someone from Dawson Creek and someone from Merritt.

The three of them have all indicated a preference to do rural medicine, yet they weren't permitted to be successful in applying in British Columbia. They want to come to British Columbia, and this is known because they've spoken to this group of doctors. They want to come to British Columbia, but they're not able to. They go to Manitoba. There's a requirement in Manitoba of a reciprocal four years, I think, after you graduate from your residency to pay back the obligation, although that's not necessarily required for Canadian graduates of Canadian schools.

In effect, the likelihood that they will return to British Columbia to serve these rural communities is remote. At the same time, I am told, the ministry on occasion recruits physicians in South Africa. I'm familiar with northern British Columbia. I have a couple of relatives who are doctors in northern British Columbia, and the number of South African–trained physicians in northern British Columbia is quite well known.

It seems to me that the policy of UBC and the Ministry of Health is blocking access to residencies of these highly qualified — and I don't think there is any doubt about the qualifications, ranking in the 99th percentile — medical graduates who could assist in solving one of the problems we have here, which is attracting skilled and trained physicians to rural B.C. communities.

We're going to wrap here. I know the minister may not be able to address this question in full, but I'd like him, if he can, to indicate on the record his reaction to this problem and what commitment he might make to begin to resolve this problem. These are people in positions, some of them — in one case, a faculty member at UBC —who just find that the bureaucratic obstacles to bringing about change here seem to be immense for some peculiar reason. It's not serving the interests of British Columbia well at all.

[1830]

Hon. M. de Jong: I hope the member accepts, from my earlier remarks, that I endorse wholeheartedly the proposition that there is more that we must to do to tap into the talent that is represented in the international medical graduates. I am, and the ministry is, engaged. I am committed. I am personally interested in addressing the matter and take great personal interest.

Because we don't have time, I'm not going to quibble with their words — a couple of aspects of the characterization of the problem that I might not agree with wholeheartedly. I do agree that there are some lingering systemic obstacles that make it difficult — in some cases, impossible — for international medical graduates to demonstrate that they are qualified to enter the residency program.

There's a second part to that: providing them with the option, the ability, to do that does not eliminate the challenge we face in creating additional residency options for them. My interest is bridging that gap between the demand and the supply, and ensuring that British Columbians have access to the best. So there will undoubtedly always be a competitive element to this. But I'm not satisfied as long as there are systemic obstacles to allowing people to enter that competition, and that's the first step, I believe, in addressing this.

Vote 29: ministry operations, $16,032,867,000 — approved.

The Chair: The committee will recess until seven.

The committee recessed from 6:32 p.m. to 7:02 p.m.

[J. McIntyre in the chair.]

ESTIMATES: MINISTRY OF JUSTICE

On Vote 31: Attorney General operations, $368,337,000.

Hon. S. Bond: I just want to begin by introducing the staff that are with me at this point in time. I'm going to also ask the indulgence of the member opposite in a moment to help me with some staffing decisions here.

I'd like to introduce David Loukidelis, who is the Deputy Attorney General; Lori Wanamaker, who is the Deputy Solicitor General; Tara Faganello, who is the assistant deputy minister of management services branch and our executive financial officer; and David Hoadley, who is our executive director and chief financial officer.

I don't intend to make any opening remarks. I think the member and I speak with one another on a regular basis and ever so much more in the last few days. I'm wondering if the members opposite would mind providing me with some sense of the outline of where we may be going in the next couple of hours. I basically have an entire ministry executive team on hold in the basement. So if you happen to have a sense…. If there are no Solicitor General issues, out of courtesy to my staff, if you could assist me with that, that would be appreciated. If not, I'll just keep the entire team waiting.

L. Krog: I can't help but remark on record that it reminds me of the characters in a Victorian novel living in reduced circumstances here tonight in our tiny, cozy quarters.
[ Page 12130 ]

Having said that and appreciating that we don't wish to keep the ministry staff working any harder than they already do…. I might say for myself and my co-critic for the Ministry of Justice and Attorney General, we appreciate the good work they do.

Our intention tonight is to deal with the ministry as a new ministry and then to move to the Solicitor General's side of it, if you will. So that might provide the minister some assistance. And depending on how the questions are answered, that may provide assistance to her.

My friend said that in light of other changes, we're going to do Attorney General first. So if that's all right, we can let the Solicitor General go.

Interjection.

The Chair: Member, excuse me. You have to be recognized.

Member for Burnaby–Deer Lake.

[1905]

K. Corrigan: Yes, thank you, Chair.

Just in terms of that, my understanding was that it was through discussions with your office that the order was expected to be…. I think we were originally going to do Solicitor General first. My understanding was, because of some scheduling of staff…. We got an e-mail back saying the preference would be to do Attorney General first and then Solicitor General the following day. That's why we've got it in that order.

Hon. S. Bond: I have no idea who sent that e-mail or how that happened. At the end of the day, I have both sides of the ministry here. It is entirely your prerogative. You can choose whichever you'd like, and we will be here and very well supported to answer the questions.

L. Krog: That being the case and given what my friend's understanding is, let's let the Solicitor General's staff go home tonight and spend some time in the warm, salubrious climate of Victoria.

As indicated to the Attorney General, the first discussion is around the ministry as a new ministry, a merged ministry. I'm wondering if the Attorney General can advise what the cost of merging the ministries was.

Hon. S. Bond: There has been very little cost. I mean, obviously, there may have been some to change the title to Ministry of Justice. We've always been co-located, so there were very few physical changes. In fact, part of the rationale for the merging of the ministry was as a result of an internal audit that was done that looked at how we did business together.

What we discovered was that we didn't do it very well in independent silos. There is and there will be very much an emphasis on not only doing our work collaboratively but also at looking at how we find and look at savings that we can put into important front-line programs.

L. Krog: To the Attorney General: I'm wondering if she can advise what savings are anticipated, then, as a result of this new collaboration.

Hon. S. Bond: The internal audit was actually very informative. We welcomed the opportunity to review the ministry. I appreciate very much the leadership of my two deputy ministers, who embrace the opportunity to look internally and ask the questions about how we could do things in a better way and also look for savings.

The internal audit identified that we should be able to find savings of $10.7 million over three years, particularly looking at corporate services. We're not touching front-line services. In fact, our budget received an increase this year overall, but we're looking for $10.7 million over three years. Mainly, we're looking at how we do business in a more efficient way and, again, focusing on corporate services.

L. Krog: In terms of corporate services, perhaps the minister could be more specific. What is she thinking is going to produce these savings? Can she perhaps quantify whether the savings will be front-end-loaded, so to speak, or back-end-loaded?

[1910]

Hon. S. Bond: The savings that we're looking to achieve are spread out roughly evenly — $4.3 million in the first year, $3.2 million and $3.2 million, so $10.7 million cumulatively after three years. The areas of focus are finance, IT, strategic human resources, facilities and corporate planning. Basically, we're looking at how we work together more efficiently. The reductions are in those areas that support the ministry but not in front-line programs.

L. Krog: Our understanding is that ICBC and PSEC went to Finance, and responsibility for liquor and gaming went to the Government House Leader. What impact has that had on the budget?

Hon. S. Bond: ICBC and PSEC did move over to the Finance Minister — actually appropriate from my perspective; a bit of a relief in terms of workload, for sure. ICBC is a Crown, so obviously a stand-alone budget. PSEC also had a stand-alone budget. They were simply, basically unplugged and sent over. The same would be true for liquor and gaming. They had stand-alone, intact budgets, and they were shifted to the Ministry of Energy and Housing.

L. Krog: So when the minister makes reference to a bit of an increase in her budget, in fairness, that's in ref-
[ Page 12131 ]
erence to all of the things other than the items we've just been discussing: ICBC, PSEC, etc. In other words, it all remained in place and, in fact, got a modest increase.

Hon. S. Bond: The member is correct.

L. Krog: With respect to the merger of the ministries, my understanding is that most jurisdictions in Canada, in fact, are separate. You have both a Solicitor General and Attorney General. I understand that the provinces of British Columbia, Manitoba now, Newfoundland and Nova Scotia are the only provinces in Canada that have in fact merged ministries. I'm just wondering: before they were combined, were any studies undertaken, apart from the audit itself?

Hon. S. Bond: No formal studies were done. Certainly, in my attendance at meetings, there are a number of provinces that have a Ministry of Justice and Attorney General. In fact, Alberta has just newly named a Minister of Justice and Attorney General, exactly the same configuration that we have, so they could be added to that list.

L. Krog: Can the minister explain over what period of time the decision was made to merge these ministries? Did it result strictly from the audit? Was that — how shall I say? — the impetus for this, or has this been under consideration for a long period of time?

[1915]

Hon. S. Bond: Probably there wasn't a single trigger point. There had been a lot of discussion about justice reform and how we better brought the system to a place of a more collaborative approach, how we maximize the efficiencies. Certainly, the internal audit clearly outlined that from the view of those people who did the audit, and again, we were very pleased to collaborate and cooperate with that process. Ultimately, it pointed in the direction of how we do this differently.

I think — and I'm prepared to be corrected if I'm wrong — these ministries have had, in previous iterations, a combined ministry as well. So it wasn't necessarily new territory.

As we looked at reform and eventually produced a Green Paper, one of the things we talked about was looking at reinventing ourselves. If we expect the justice system to work as a more collaborative entity, it better start where the policy decisions are made. So we've certainly worked very hard with our staff to work through the evolution of the changes, and we're seeing some very positive results.

K. Corrigan: I'm wondering if the minister could go through those three things — the merger, the Green Paper and the audit — in terms of timelines. I know the minister has just partially addressed it, but it was certainly a question that I have. What was the timeline of the various things that were happening, and when was the decision made to merge?

Hon. S. Bond: As I said in my previous answer, there isn't a point in time that it was determined that the merger would take place. Ultimately, Madam Chair, probably a discussion about cabinet appointments and mergers needs to be discussed with the Premier as well. It's ultimately her decision, and she made that decision.

The audit work began — as I am trying to recall — I believe, in July. In the summer the audit team was assigned to the two ministries, and that work proceeded through the fall. We were made aware of results and outcomes throughout the course of the fall and released the audit publicly on February 8, when the merger was announced. So the audit played a critical role in informing both the ministries, the minister and, obviously, the Premier about how we could better support a justice reform agenda.

The work was done in the audit in the summer and published on February 8, when the merger was announced. Throughout the whole course of that discussion we recognized the importance of looking at justice reform and believed that an important step would be, after seeing the results of the audit, looking at a merger of the ministries to better serve the justice reform agenda that we were about to undertake.

K. Corrigan: The audit has a date signed by Chris Brown, of the internal audit and advisory services, dated September 2011. So I'm wondering why it is that it was decided to keep that document under wraps until February.

[1920]

Hon. S. Bond: It wasn't a matter of keeping it under wraps. We made a commitment to make it public. We did that. But in the meantime we began to contemplate what kinds of changes needed to be considered in the ministry as a result of what was a pretty stark description of how the ministry worked together.

We also need to recognize that in the middle of that we were already contemplating a discussion about how the ministries work together. Part of that actually comes from my reflections. I was first appointed to be the Solicitor General and then moved on to take on the Attorney General's role.

Certainly, as I watched the way the two ministries worked together, I fully supported the view that the internal audit provided, which was: you can do this differently, you can do it more effectively, and you certainly need to lead by example, if that's what you intend to contemplate when it comes to the reform of the justice system.

K. Corrigan: Well, it was perhaps helpful, but it was also very critical. I was wondering if perhaps what the
[ Page 12132 ]
minister felt is that it was so damning that there had to be something done before it was published, and thus we had the Green Paper, and we had the merger.

Just to quote a couple of pieces from the audit. Overall, "there is no clear accountability for justice systemwide results in one place, as each branch has their own accountability framework. Branch business planning is done in isolation without consideration of strategic alignment. An absence of integrated approach to business planning…" and so on and so on.

I'm just wondering if it's possible that part of the reason this was not made public when it was available, and could have perhaps informed some immediate changes, was that perhaps the minister wanted to, or communications people or whoever felt that they better get some response to this together and some plan before they made it public.

Hon. S. Bond: Absolutely not. There were two separate ministries. They were operating separately. In fact, I encouraged the audit and welcomed it, as did both my deputy ministers. We actually wanted to see how we could deal with issues that were already emerging. As I said to the member opposite, I very much welcomed the opportunity and the challenge. We were not shy about grappling with the criticisms, and they were fairly straightforward. I think it's a healthy process when we welcome a look internally, and then we begin to look at how we can make those improvements.

Did it shape our response? Of course it did. Why would a person or a ministry receive a document that says you're not doing things very well, and simply sit there? We actually embraced it, and we're very excited about the chance to reshape a ministry, bring our team together. It takes time. We're talking about employees who work very hard to ensure that the ministry operates well.

It was a pretty significant message that we had to do things differently. So I embraced the audit. I embraced the recommendations, as did my entire executive team, and I think we're seeing some very positive results as a result of that merger.

K. Corrigan: Well, again, based on the review…. This is part of what the audit says: "Based on the review, it's clear that an overall justice system perspective is lacking; instead, it's largely a fragmented approach, with each branch of the two ministries planning, forecasting and operating independently."

As well, from reading the audit, and I have read it fairly closely, those concerns were not just with the separation of the two ministries. There were a number of comments about silos even within the ministries, within the branches.

I'm sorry if I have to wonder about the minister, whether or not, in fact, this was entirely embraced or that it was a pretty damning report that had to be acted on in some way, and it couldn't just be released without doing some work in order to fix the problem.

Hon. S. Bond: Absolutely, it was a critical report. The member can choose to question the veracity of my answers. That's within her prerogative.

[1925]

The fact of the matter is we invited and supported the Minister of Finance and the decision to look at audits. There are audits underway in a number of ministries and organizations, and I think they are helpful. I've never been defensive about looking at the work that we do and figuring out how to do it better. Both my Deputy Attorney General and the Deputy Solicitor General were part of the process. In fact, it's not easy to look at the team that you work with and the work that you do and receive the kind of report that we did.

The fact of the matter is that we embraced the change. I am extremely proud of the team that has responded and has had to change the way they do business. There are very strict expectations and guidelines in place now. We have a responsibility to look for administrative savings. We're going to reach those targets. That is not an option.

The audit outlined a plan and a course of action. We embraced it. I'm assuming that's fairly transparent, because we became the Ministry of Justice and Attorney General. We melded our executive teams together. We are transforming the back end of the ministry in a way that reflects and responds directly to the report.

L. Krog: At the time the announcement was made, the February announcement when the ministries were merged, a justice reform initiative, to be led by Mr. Cowper, was announced at that time — a Green Paper, Modernizing B.C.'s Justice System, etc. — and the audit was released.

I'm wondering: why wasn't Mr. Cowper, in light of the timing of the audit, appointed to undertake this task earlier, before the ministries were in fact merged?

Hon. S. Bond: Well, I think first of all, we're talking about, in many ways, two distinct processes. The audit that looked at the ministries was internal. It looked inward. Our job as a team, the minister with the executive teams, is to redesign the ministry inside out.

As we were doing that, we began…. Obviously, as I became the Attorney General and began to look at issues like stays in courtrooms and, you know, the trends of fewer cases, lower crime rates, all of those kinds of things, I was very compelled to look at why those issues exist. We've certainly had that discussion many, many times, about, you know: is it a matter of just putting more money in or of actually challenging the system?

They were simultaneous processes. That is why, when I first answered the question, I said that it wasn't at a par-
[ Page 12133 ]
ticular point in time. There were a number of processes underway. As we wrote the Green Paper and as we started to think about what those stimulating questions are that could prompt the kinds of changes we believe are necessary, it became apparent that we needed someone to look externally at the broader justice reform issues. That's why Mr. Cowper was selected.

L. Krog: With respect to the choice of Mr. Cowper to head this review, why was the decision made to choose Mr. Cowper? The obvious questions arise from his firm having been a donor to the Liberal Party. That started his position with some controversy.

Given that kind of association, and given that this is supposed to be an objective review — and I'm not suggesting it won't be, because I have great respect for Mr. Cowper — the appearance here is important, when you're announcing something that is important enough to be announced at the same time as the audit and which the taxpayers are obviously going to be putting a fair bit of money into, to enable Mr. Cowper to provide a report. How did Mr. Cowper come to be appointed?

Hon. S. Bond: What I looked for…. You know, there are lots of superb individuals, whether it was in this government or the previous one, who had some connection. It's pretty hard to find exceptional people.

[1930]

Let's be clear. Mr. Cowper did not make the donation. His firm did. I think there's something to be said for being very precise about that. We chose someone who has an internationally known reputation, and the member opposite even noted his respect. I can't begin to tell you how well received his appointment has been in terms of his relationship with the judiciary.

We're hopeful that we're going to see some progress made in terms of defining that whole issue of constitutional independence. He was selected because he has impeccable credentials. He is well known internationally, nationally and, certainly, as an exceptional lawyer, here in British Columbia. His reputation is stellar.

I also believe that he had the ability and the will to challenge what is a fully entrenched system. It's called entrenched independence, I'm told. You need someone who's prepared to take those issues and do it in a respectful yet challenging way. I believe Geoff Cowper has all of those credentials.

L. Krog: I suppose it begs the question, in terms of selecting Mr. Cowper…. I think there are 10,800 practitioners in the province now. Obviously, Mr. Cowper is one amongst many. There are many senior, respected practitioners.

Was there any kind of a process involved in this selection? In other words, did you interview a whole pile of people? Did you seek recommendations from various bodies or groups — the judiciary, the Law Society, the Bar Association? In other words, how did Mr. Cowper come to get this job?

Hon. S. Bond: There was not a formal process. As is often the case when you're looking for someone to lead a transformational change, a number of senior lawyers in a number of fields were recommended, and we had a discussion about that, but there was no formal process. We did not seek to ask anyone formally other than Mr. Cowper, but certainly, a number of names were discussed with my deputy.

L. Krog: I take it from the minister's answer that in fact she consulted with her deputies only. Is that the case? They suggested a number of names, and then the minister chose one name, or was Mr. Cowper the recommended person from the deputy ministers? How did that process actually occur, and over what period of time?

Hon. S. Bond: We anticipate it was about…. We don't know the exact timeline, because as we formulated our plan, we wanted to…. In fact, the members opposite just recently said: "How come you didn't get on it faster?"

We didn't take a long period of time. We did not have a formal process, as I said. We discussed it. I have every confidence in my deputy to provide me with that kind of advice and give me some idea of the skill set of these individuals. We think probably about a three-week period. We have a marker because the Deputy Solicitor General was away for a three-week period, and she said, "The conversation started before I left and was continuing when I returned" — so about that period of time. Again, it was certainly not a formal process, but it was based on looking at the reputation.

[1935]

I was compelled partly by the connection with the Law Society and the long relationship, particularly on issues around legal aid — those kinds of skills which were important to me and a very important part of this discussion, important in terms of the discussion we wanted to have.

K. Corrigan: Could the minister tell me when that was — that three-week period?

Hon. S. Bond: I want to correct the record as well. It's the Legal Services Society where Mr. Cowper was…. I think twice he has been the head of the Legal Services Society. It's late, and I apologize for that. Probably the month of January, and then the appointment was announced in February.

L. Krog: When the minister made the announcement on February 8, a number of things were proposed, including the implementation of a suite of initiatives that
[ Page 12134 ]
included the integrated planning secretariat. I wonder if the minister can tell us about that — how its work is proceeding and who is involved.

Hon. S. Bond: As you can tell by the growing cast behind me, many of them have a role to play in this issue. We actually call it the justice reform council. It is co-chaired by the Deputy Solicitor General and the Deputy Attorney General. Their primary focus is developing a strategic plan and — probably importantly, when we refer back to the audit — performance measures. One of the biggest concerns that I think all of us had was…. You know, we continue to invest money, and we want to make sure that there are actually performance measures attached to that.

So the justice reform council has executive members from policing, corrections, justice services, courts, community safety, child and youth criminal justice, the Office of the Superintendent of Motor Vehicles, and our EFO and business side also are represented there. It is an exceptional group of people.

On a personal note, I love it when they come to report to me. Typically, it is every other week. They come and present the next-steps in terms of the progress that's been made.

[1940]

K. Corrigan: Well, previously…. The audit says that there was a committee called the criminal justice executive committee. I'm wondering why it was that this committee, which has been in existence and which covered both of the ministries, was not doing essentially the same work as the justice reform council. Did I get that name right? Why was that work not being done in the past through that committee or some other committee?

Hon. S. Bond: I think the easiest way to describe it is that the criminal justice executive committee was very focused, obviously, on the criminal side, so there was not a lot of contemplation on civil reform. But I think, more aptly, a better way to describe it is that it was focused on programs and a programmatic response — pilots, programs. How do we fix this programmatically?

The group that we have put together now is talking about a systemic reform and how we integrate, how we work better together. This criminal justice executive committee would have been very specifically focused on programs — a very different mandate than the current working group.

K. Corrigan: Are there any program areas that have not been merged as a result of the merger of the ministry?

Hon. S. Bond: We were trying to think of whether there were any. Obviously, there are external agencies that remained that way. The Public Guardian and Trustee is a good example of that. That's not been merged, because it wouldn't be appropriate to do that.

I gave clear direction after the audit that I expected the executive teams to be merged, that they were to meet jointly and that we were going to embrace the direction that had been provided in the audit. So I think that has been very systematically followed. The executive teams meet together. The two deputies share their work. Obviously, they have different areas of expertise and focus.

We need to be clear about this too. This kind of transformation is not easy on staff. It's a challenge to rethink how you do things.

[1945]

We saw that there was a change needed, and we've embraced it. It's taken time to work through a different approach to justice, and I'm really proud of the way that our teams have responded to that direction. I think we're working differently than we did a year ago.

K. Corrigan: Was there, then, a physical move when the two ministries merged? I don't know what the office space is like and so on. What did this mean physically?

Hon. S. Bond: There is no physical change. In fact, the two deputies are 12 steps apart.

K. Corrigan: My understanding would be that this is a much wider merger — is it not? — than simply the two deputies. I'm wondering about how extensive the merger is. Do all the branches continue to be separate? How is it happening that there's a merger of the various operations of the two ministries into now one?

Hon. S. Bond: The primary criticism in terms of the audit was corporate services, so that's where the merger has been most specifically directed. We now share corporate services, and that's where we're going to look for the savings. There is no reason why we shouldn't be able to generate the savings, as expected. We're going to work very hard to do that.

We share our planning, we share our business practices, and we are creating a strategic plan for the Ministry of Justice.

K. Corrigan: So the minister is saying that the merger applies to corporate services and senior staff, and that's the focus of it?

Hon. S. Bond: Again, the primary focus of the audit and the restructuring was an integrated corporate services framework, and that's exactly what we've done. We've tried to create and are creating a common internal structure.

Do we still have court branch? Yes, because court branch staff and the team have specific responsibil-
[ Page 12135 ]
ities. We have a corrections branch. We have all of those specific subject areas, but we plan differently. We speak to one another differently. I have certainly made it clear that our expectation is that it starts at the top, that we work together in a different way. We've tried to demonstrate that.

[1950]

When we now meet, both of my deputies meet with me, and we work through the issues that we're facing. So there is a different practice in place. Does it mean we don't have an office that looks after courts or corrections or policing? No, it doesn't. Those still exist.

K. Corrigan: Well, I appreciate that corporate services…. It sounds like it's a good initiative.

But I go back to the audit. What the audit says, on page 1, is: "Based on the review, it is clear that an overall justice system perspective is lacking. Instead, it is largely a fragmented approach, with each branch of the two ministries planning, forecasting and operating independently. Further, the delivery of justice supersedes a focus on cost consciousness across parts of the system."

I have read the report. It seemed to me from looking at the report that the concerns were much wider than corporate services, which includes corporate planning, finance, strategic human resources, facilities, information management and cross-functional corporate services responsibilities.

Hon. S. Bond: That's why we have the group of people working together that we do, who are talking about justice reform. In fact, we're creating a strategic plan for the overarching role that the ministry has to play. So of course it's broader than that. What I simply pointed out was that the court branch is still the court branch. I can't imagine it being amalgamated with criminal justice branch.

There are independent work units within our ministry. We took the audit, basically, line by line and sorted out how we were going to respond to what I think were legitimate, difficult-to-read criticisms. But they were legitimate.

We are working as hard as we can. Again, I can't begin to say enough about the staff who have been asked to think differently. We've had sessions with our employees to talk about how we want to shift the thinking in the ministry. For some employees, it was easier than others.

But it is a change. So if the member is implying that we've changed in name alone, that would be incorrect. A simple discussion with our employees would point out that this has been a stretch and a challenge for many of them.

K. Corrigan: I'm wondering how the minister sees this change — the merger of the two ministries and the work that is happening with the justice reform council and how that fits in with the overall review that is happening.

Hon. S. Bond: All of us eagerly await the report by Geoff Cowper. In fact, he's reported out once, and he is reporting out on a regular basis. I expect another one in the very near future — in the next week or so, probably. The public is going to be as aware of his recommendations as we are. The expectation would be that…. I have no idea what his recommendations will look like.

This group will be part of the group that assesses what recommendations he brings to government. Our commitment is to produce a White Paper, which would then be circulated as government's response to his recommendations. Obviously, the justice reform team will also have a role to play.

[1955]

The work, as we've pointed out over the last number of days, is not simply on hold while Geoff does his work. It's important work, but our own team has looked at reform items as well. We've seen a number of those on the Legislature floor, and ideas that have been germinated from a great team of people in the ministry.

It's a very fluid process, but our commitments are this. We will receive Geoff's report. In the meantime, he will report out regularly. That work will be reviewed and analyzed, and we will then produce a White Paper that would provide our recommendations based on his input for the public to comment on.

L. Krog: I appreciate the minister's responses. Having listened to the minister talk about how the justice reform council is going to work, I take it that it's comprised of her senior executives from what used to be both ministries. It appears to meet with the minister biweekly and report back to her. It will, I presume, and does receive Mr. Cowper's regular reports and reviews those and then likewise, I assume, reports to the minister. The minister has indicated that she's going to make Mr. Cowper's reports available at some point.

With respect to Mr. Cowper's reports, are those individual reports or his final report? Will it be attached to the White Paper? Will it be released before the White Paper? What are the minister's intentions around the work?

Hon. S. Bond: I should correct something too. The entire team does not meet with me biweekly. Both deputies — well, they meet with me weekly on a number of topics — report biweekly. Representatives of the team will often come and speak about specific initiatives. I want to be very clear that the whole group doesn't appear every other week.

Mr. Cowper's first report was made public. Actually, it was posted as soon as we received it. He made a commitment to being transparent, so the first one is out. It summarized the groups he had spoken to and sort of his
[ Page 12136 ]
initial work.

He will be doing a second interim update. As I said, that will be posted within a week. He makes the decision about that and posts it. He has his own website and blog about that, so he's very transparent about that.

The current timeline for Mr. Cowper's report to be received by government, I believe, is the end of June. Then our intent would be to review that work that Mr. Cowper does, look at any other initiatives that we may be interested in pursuing in addition to his and provide a White Paper to the public. I believe the timeline was the fall for the White Paper.

L. Krog: Is it the intention that after this White Paper is produced in the fall that we would be potentially looking at legislation in the spring that would flow from that? The reason I ask is, obviously, that the ministry has proceeded with several bills that have created no small amount of controversy, including Bills 44 and 52. It would indicate, certainly on the face of it, that there has been a certain lack of consultation with the public — the bodies, I should say in fairness, who you would expect to be the usual suspects involved in any change to the justice system.

Having said that, is Mr. Cowper consulting with a view to legislation quite specifically, or are there any legislative changes contemplated already?

The sense is, and I'm being quite direct with the minister, that the ministry has gone ahead and undertaken these changes without much consultation — or any consultation, as some allege. Is the process now going to be more transparent in the sense that the bodies that one would expect to be consulted will in fact be consulted?

The Chair: Just a reminder to members that legislation or the need for legislation is not the purview of this committee, the subject of ministry estimates.

Hon. S. Bond: I need to take the advice of the Chair.

I'll simply say that Geoff Cowper will bring his recommendations to government. We have no indication whether or not that would include anything as specific as legislation. I have no idea.

L. Krog: Is Mr. Cowper's mandate to include recommendations with respect to legislation? I don't think I'm crossing the Chair when I say that. Is his mandate as broad as that?

[2000]

Hon. S. Bond: I think it could include suggestions that would include legislation.

One of the bulleted items, the final bullet, in the mandate of Mr. Cowper states: "…steps including legislative measures, if any, within the constitutional authority of the province that can and should be taken to give effect to the recommendations."

L. Krog: At the time, going back to February 8, there was also an announcement that involved the justice system–wide business intelligence project. Can the minister tell us what that is and who's involved?

Hon. S. Bond: I always comment on how much I enjoy the reports on this part of the work that's being done, and I have to say a huge thank-you to Allan Castle, who is here tonight.

The ministry business intelligence work is looking at justice system reporting and analysis tools so that we can actually look at data that exists within the system that may or may not be utilized well, looking at how we can look at system performance. It also is about how we look at costs and look at cost containment. It's very interesting work.

It is a multi-year project. And, again, really innovative, hard work is being done to say: "We need to look at the information that exists. How do we use that? How do we capture it? How do we share it? How do we communicate it?" There's been a lot of very thoughtful work done, but again, it's a multi-year project. We're early into this work, but I think it will be transformational in and of itself.

L. Krog: I have some vague recollection of asking one of the minister's predecessors about statistics that the ministry may have kept. I think it was around the issue of prosecutorial success and things of that nature. There was an indication — this was several years ago, I think, when Mr. Oppal was the Attorney General — that those kinds of statistics or statistics related to that weren't actually kept and, given the way British Columbia's system works with respect to prosecutions, they weren't going to be kept.

In fairness, I take it…. Is that part of the work of this new justice system–wide business intelligence project? In other words, what kinds of things are they in fact doing? Could the minister be more specific?

[2005]

Hon. S. Bond: In fact, one of the things we know is that there's a lot of data, a lot of information, but it's not used in how you determine policy or practice, and we certainly don't look at how we tie that to outcomes.

We want to put — and I think Allan says it better than me, but he's living this right now…. We want to put the decision-making process and the way that people communicate about the justice system on an empirical basis. We want to actually look at the data that's out there, look at how we integrate it. So let's look at processes. When do they begin, when do they end, and what happens along the way? And not simply those, but how does that then impact policing, or how does policing impact that particular circumstance? We want to have a look at that.
[ Page 12137 ]

As I said, there's some great work being done. In fact, we created our own dashboard. It's called JusticeBC. It's a court-finder, for example. You can actually take your mouse and hover over a part of the province and hover over a specific courthouse, and it will tell you facts about that courthouse. I think what we want to do is engage the public, help them to understand the system, help us to understand it better. As I said, it's a significant piece of work and will certainly take time.

Our dashboard is in its initial stages, and we've looked at some work that's been done internationally that's probably more sophisticated than ours. Not being critical about what we've done, but we have room to grow in terms of the kind of data and information that we're able to share.

Again, a lot of work, but a really good start to it.

L. Krog: When did this particular work start? Was it launched prior to the February 8 announcement? Was it launched afterwards? Who's leading the project? And perhaps if the minister could be more specific about even the dashboard. I mean, what sort of statistic am I going to find? If it's just going to tell me where the courthouse is and the address, that's not overly helpful. I assume there's more to it than that.

Hon. S. Bond: The conceptual work began in the fall, sort of as part of our broader discussion. We are now looking at a ministry-level process.

The member opposite asked: "What kind of data would be available?" Yes, well, it will tell you where the courtroom is. Yeah, that's part of it. But it will also tell you the prisoner transfers. It will tell you how many cases are pending. It can tell you the hours of sitting in a particular court, the average number of appearances to trial — all of those kinds of things.

[2010]

We're also looking at connecting data. So, looking at charge assessment, how do Crown and police interact with one another, and how does that work? There is a lot of….

All of this leads us to look at: what are the inherent issues in the system? How do we actually fix some of the challenges? How do we shape policy and practice around data so that it is empirical and it is fact-based?

Again, we have work to do on the dashboard, but it's a really great start. The conceptual work began in the fall, but we're actually down now to building the specific, ministry-level information sections of the work.

L. Krog: I can't help but be amused by the concept of the dashboard. It reminds me of the second automobile I ever owned, which was a Volkswagen Beetle that didn't even have a gas gauge on it, but very little could go wrong with it, I might add. It was very cheap to run.

This raises one of the questions. How is this information being gathered, and what sort of staff time are we looking at in terms of that gathering?

Hon. S. Bond: These are very technical answers we're trying to pare down to a minute or two here.

The data exists. It exists in various branches and various sectors. The key is taking the various types of data and, instead of looking at them in isolation, looking at them in an integrated way to say: "How does something that happens over here impact something that happens over there?"

We have a business intelligence working group that is managing through this project. It's very complex, but what we've done is we've brought the data experts from each of the branches together to say: "How does the data that impacts what you do link or integrate, impact, work that's being done in another branch?"

I gave the example prior to this of when you look at charge assessment, for example. How do Crown and police work together? There's data there. How many charges…? What do the police do? How does that impact charges? We have to bring those pieces of data together. That work is being done. Again, we've brought data experts from within each of the branches together to work on that.

L. Krog: How long has this type of data that the business intelligence project is looking at been gathered? Has it been kept entirely separate? Do I take the minister quite literally, that this information was only used within a given branch?

[2015]

Hon. S. Bond: Each system has records, and they've existed for a very long time. Police have records. Corrections have records. Crown has records.

The issue is: how do you look at that data? For example, look at…. When an incident occurs, what happens between the incident, to the charge, to the case? If we want to see those times shortened, if we want to see greater accessibility, if we want to reduce backlogs, we actually have to understand each of the pieces in that process.

The data has existed. What hasn't happened is there hasn't been an integrated look at how this data can inform improving the justice system. One of the key planks that we're looking at in terms of reform is actually looking at empirical information and saying: "How can we create a better, more accessible, efficient, expedient justice system?" I mean expedient in the sense of appropriate. I'm not suggesting we ram things through the courts.

There are enough challenges within the justice system that we have to start asking some of the tough questions instead of just simply saying: "We can fix it by adding something here or adding something there." This will give us the empirical basis we need to shape policies in the future.
[ Page 12138 ]

L. Krog: Are there any new types of data being collected as a result of this project? Or are we simply taking data that, as the minister has pointed out, has been collected for years but never utilized, I presume — and I want the minister to answer this specifically — outside of the branch, per se?

Hon. S. Bond: There would be very little new data collected, but in fact what we're creating is new knowledge. That's really what this is about. We're not looking for new data. We're actually looking for a new way to use the data.

In fact, when we look across the country, very few other jurisdictions, if any, actually look at linking the data. Part of the reason for that is the framework in which the justice system works, which is a system based on independence. So there have always been independent organizations keeping data.

What we're doing…. So it's not about new data. It's about new information, new knowledge, a new way of informing your practice. This will put British Columbia at the forefront of how data is actually used, in terms of looking at best practice and improvement.

K. Corrigan: Well, we are going to have a new look at data. I'm wondering how it is that the minister expects, given that we've had a number of reports about the delays in the justice system coming from the judiciary, coming from various…. There have been many reports over the last several years. How is it that the minister expects that a new look at data is going to improve the justice system?

[2020]

Hon. S. Bond: I think there are a whole bunch of ways that we could potentially see changes in the system. We have to stop relying on anecdotal conversations. We need to actually look at empirical data that can help direct how we're going to change the system. For example, when we talk about court delays, we find ourselves tweaking judicial rules on the front end. "Let's just tweak a few rules and hope it gets better."

Well, actually, what this would allow us to do, when you think about it, is that if we were to contemplate file management or alter scheduling…. And I say this right now, before I start getting e-mails, that that would be done in a collaborative way with the judiciary, with prosecutors, with others. What it would allow us to do is actually track when a case goes into the system, what happens along the way and where it ends up.

We can't do that today. We don't do that today. Instead, we wait for the cry that says: "Just add more money here, and it'll fix the system." And it doesn't fix it. What this would allow us to do is analyze what those challenges along the route are, what the root causes of those delays are, by looking at the data. Then we could decide where most effectively to add the resources to actually fix the system.

There are some challenges along the way. We understand. And I will say this for the record that scheduling the courts is the purview of the judiciary. We understand that, but we're engaged in a very collaborative discussion. We appreciate that. Certainly, the chief judge and justices have said that, respecting their independence, they would like to have a conversation about how to make that kind of improvement.

When you can demonstrate, using data, that we have some issues, I think it helps shape where we're going to put investment. I have said continuously that we're prepared to invest resources where it's appropriate and when necessary. The data helps drive that agenda.

K. Corrigan: You know, we apparently have had a lot of this data. We've had it for years. It hasn't been used. We've had reports for years. What I don't understand is how it is that for the 11 years now that this government has been running the various ministries, in control of the ministries, in control of government, these things have been not done.

[2025]

Hon. S. Bond: It's because it's a pretty complex system, and it's entrenched in independence. That's the whole challenge. In the Green Paper — if the member has read the Green Paper — we lay out for British Columbians some of the big challenges we're facing. One of the reasons is because it takes will, and it takes a willingness to challenge the status quo. So yes, there have been reports, and I'm not going to purport, standing here today, that Geoff Cowper's work is going to be the magic solution to challenges in the system either.

If British Columbia were facing this issue alone, then I would be far more worried than I am. Every minister of either a province or a territory that I've met with when I have been at ministerial meetings has exactly the same concerns. In fact, we've seen it in the recent report coming out of Ontario — which was the Drummond report, much more related to the economics of Ontario. I can assure you they had serious concerns about the sustainability of the justice system in its current format.

In terms of why it hasn't happened, it's because it's a system where typically our response is: "Here's a problem. Let's pour more money into it." It hasn't addressed the inherent issues.

I think that realistically looking at data in a new way — in a very aggressive way, to look at the integrated process and the audit — helped shape our thinking. It said: "You don't do this well enough." And we said: "Okay. What can we do differently?" So we're giving it our best shot as a team with all of the people we have, at looking at how we can make a difference. And I'm as frustrated as others about: "You know, why can't we just fix the system?"

But it's been decades and decades. To suggest it has
[ Page 12139 ]
been 11 years would be very unfair and inaccurate. The same problems existed in the 1990s with backlogs and a number of issues. No matter how many judges, there was always a call for more, and there were issues in the courts then. We're simply saying that it's time for us to look at this through a different lens. We believe that. Looking at a systemic approach and using data that — the member is right — previously existed, we're saying it's time we did something different with that data.

K. Corrigan: The minister just stated that the root of the issue or the problem — I hope I'm not overstating what the minister said — is independence, when in fact that independence of the various judiciary and other parts of the system has certainly existed for the last 11 years.

I'm not talking about whether or not there were these kinds of challenges previously. I'm saying that if this is such a good idea, then this government has had 11 years to improve the system and is discovering after 10½ or whatever that it's time to fix a broken system. I'm just wondering why it has taken so long.

Hon. S. Bond: I certainly didn't say that the issue was independence. Independence is constitutionally entrenched for the judiciary in British Columbia. I respect that. I'm not going to turn this into a partisan back-and-forth, but it is inaccurate to describe this as an 11-year problem. It's been a decade-long problem. It's been two decades, three decades.

I have no guarantees that the exceptional team that I have will figure it out either, but we're sure going to try. That's exactly what's taking place every single day in the ministry — looking at new ways, trying to be innovative. We're trying to look at how we take things out of courtrooms to try to relieve pressure.

You know, there's criticism of that too. Anytime you make change, there are people who don't like it. It's more sensitive in this ministry than in many others because of our constitution, which we believe in and absolutely respect. It is more complex to actually talk about changing something when there are parameters which are immovable, and rightly so.

L. Krog: I'd appreciate if the minister could advise: who's leading this particular project? Who's got responsibility for this?

[2030]

Hon. S. Bond: The Deputy Solicitor General is also the deputy minister responsible for justice reform. Ultimately, the Deputy Solicitor General has overall responsibility, but the person leading the team regarding ministry business intelligence is Allan Castle, who is here tonight. Without him, I wouldn't be answering these questions as well as I'm hoping to. He is doing a terrific job.

L. Krog: Is the concept that this is going to continue into the future without any end date, or is there some concept that we're going to have a report back or some finality or recommendations out of all of this work taking place within the justice systemwide business intelligence project?

Hon. S. Bond: I want to make sure I characterize this properly. There's no end date to this work, because it's going to, obviously, take a lot of work and time. Right now there's a three-stage process in place that, basically, is over a period of about two years.

We expect to be very transparent about the work. In fact, we are part of the open data process in government, and in fact look forward to publishing and putting things on the dashboard on our JusticeBC site. We certainly look forward to sharing as much information as possible. That's the whole point in terms of how we engage with the public in a more informed way and how we actually make decisions about the kinds of changes that need to be made.

To the member opposite: about two years for the first stages. We're building the foundation at this point in time. But no specific end date to a project that is going to continue to look at integration of data.

L. Krog: The minister had talked earlier about the JusticeBC dashboard, which she just mentioned again. I'm just wondering: how does that function in a practical way? Is it updated on a daily basis? Is it updated on a weekly basis? What's the process?

Hon. S. Bond: Currently we're not in real time or anything near that yet. We're still busy building the technical parts that make this work. Right now we're loading chunks of data. That's a technical term, "chunks of data." But we're putting up data in chunks. We're still building the business intelligence framework that we need there.

Having said that, I can give a constructive daily example to the member opposite, and that is that court lists go up daily. You can look at any court list daily on the dashboard on JusticeBC.

[2035]

Our goal is to operate in real time. We're a ways from that yet, but we refresh whenever we have a new data set that we can put on the JusticeBC site. It will be as practical as having things like a daily court list, and that's currently being put up, as I said, each day.

K. Corrigan: The February 8 news release also said that there was going to be an outside review of B.C.'s system for approval of prosecutions. That was being launched and was being led by Gary McCuaig, QC. Why is this separate from the Cowper review?
[ Page 12140 ]

Hon. S. Bond: In the case of Gary McCuaig, QC, looking at the model for assessing and laying criminal charges, we knew what the questions were. In fact, a report was done — I think it was the Owen report, if my mind holds up at this hour — in 1990. This is a discrete body of work, whereas, in my view, Geoff Cowper was asked to look at a more broad systemic issue.

Gary McCuaig was asked to look at the whole issue of laying criminal charges in our province, and that work will obviously become part of the work that informs Geoff's final work.

K. Corrigan: I guess this will probably be the final question for this evening. What is the status of that review? I also understand that Mr. McCuaig is going to be reporting to the Attorney General and to Mr. Cowper, so has the minister received any reports or interim reports?

The Chair: Minister, and noting the hour.

Hon. S. Bond: Okay, I'll answer first, and then I will note the hour very quickly.

[2040]

I have not seen the report. The ministry did receive and looked at a draft. There was some additional work that needed to be done to meet the terms of reference that had been provided.

Ministry staff believed there needed to be some more specificity and clarification around a number of items related to the mandate. We are hopeful to have the final report to the ministry later this month.

Noting the hour, I move that the committee rise and report progress on the Ministry of Justice and Attorney General and report completion of the resolution of the Ministry of Health and ask leave to sit again.

Motion approved.

The committee rose at 8:41 p.m.

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