2014 Legislative Session: Third Session, 40th Parliament
HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

official report of

Debates of the Legislative Assembly

(hansard)

Thursday, October 23, 2014

Afternoon Sitting

Volume 16, Number 3

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

THURSDAY, OCTOBER 23, 2014

The House met at 1:33 p.m.

[Madame Speaker in the chair.]

Routine Business

Tributes

JACK ADELAAR

S. Robinson: Madame Speaker, today I’d like to just let the House know that the community of Bowen Island lost their mayor, Mayor Jack Adelaar. He passed away yesterday after a long battle with cancer. Our thoughts are with his family at this time.

Introduction and
First Reading of Bills

BILL 4 — MISCELLANEOUS STATUTES
AMENDMENT ACT (No. 2), 2014

Hon. S. Anton presented a message from Her Honour the Lieutenant-Governor: a bill intituled Miscellaneous Statutes Amendment Act (No. 2), 2014.

Hon. S. Anton: I move that the bill be introduced and read a first time now.

Motion approved.

Hon. S. Anton: I’m pleased to introduce Bill 4, the Miscellaneous Statutes Amendment Act (No. 2), 2014. This bill amends the following statutes: Agricultural Land Commission Act, Mines Act, Gaming Control Act, Police Act and Vancouver Island Natural Gas Pipeline Act. The bill also makes a validation and confirmation provision and a number of consequential amendments.

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

[1335]

Bill 4, Miscellaneous Statutes Amendment Act (No. 2), 2014, introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Orders of the Day

Hon. T. Stone: I now call continued debate on second reading of Bill 2.

Second Reading of Bills

BILL 2 — GREENHOUSE GAS INDUSTRIAL
REPORTING AND CONTROL ACT

(continued)

M. Morris: You know, this House has heard lots from members opposite during the last several months now about their thoughts towards our LNG dream that we have. They call it a dream; They call it…. I’ve heard the term “pipedream” from several of the members opposite. But it is a dream, and there’s nothing wrong with having a dream.

[R. Chouhan in the chair.]

The opposite to that is nightmares. Listening to the member opposite for Oak Bay–Gordon Head speaking yesterday, it’s obvious that he’s having nightmares about this whole scenario of LNG in British Columbia, which this bill speaks to. So I just want to go into a little bit about dreams.

A mentor of mine and a gentleman I met that I have a lot of respect for, who has helped me through my career over the years, is Stephen Covey. Stephen Covey is a well-known author who wrote several books — The Seven Habits of Highly Effective People, “Four Roles of Leadership” and a number of books — a world-renowned management psychologist, a world-renowned individual who has helped a lot of corporations, a lot of governments and a lot of individuals around the world in achieving great things.

Just relating to his book The Seven Habits of Highly Effective People, he studied leadership over the centuries. What was the common thread that brought together all these great leaders from around the world and made them achieve greatness? The seven things that I’m about to relate, I think, depict exactly what this government has been doing now since the election.

The first one I want to talk about is being proactive. This government has been proactive from prior to the time of the election in saying that we need to do something differently in British Columbia. We have concern over mental health and addictions. We have concern over education. We have concern over health care. We have concern over infrastructure projects throughout the province, transportation and moving everybody back and forth in this province so they can work.

How do we address that? The way we’re going to address it is we are going to create a brand-new industry in British Columbia — a brand-new industry. I’ve heard the members opposite say many times that this is a pipedream. I haven’t heard anything from the members opposite, from the time I’ve been elected until this point in time, anyways, about what their dream is to bring economic freedom to British Columbia, to make sure that we
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have the money to run all of the different projects and all of the different concerns they’ve brought up in this House over the past period of time.

If they do have an idea, they must be claiming proprietary rights to it. They haven’t released it to anybody. Nobody knows what it’s all about. They kept very quiet about it. Maybe they have one; maybe they don’t. But we do have a dream, and we think proactively about this dream of bringing LNG as a brand-new industry into British Columbia. We have been taking the steps in order to make that happen.

The second step that Stephen Covey talks about in The Seven Habits of Highly Effective People, and one that I can subscribe to as well, is to begin with the end in mind. What do we have? What is our vision?

I think our Premier has articulated that vision very well from prior to the last election, during the last election and during this government. The end in mind is a strong economy and a secure environment for everybody living in British Columbia. How do we do that? By developing this LNG industry that is going to pay dividends.

[1340]

It is something that we haven’t had in this province before, other than on a very, very limited basis, but it’s something that is going to help supplement the other resource sector industries in providing the things that British Columbia needs.

The third element, the third habit, is to do first things first. So we’re being proactive, and we’re beginning with the end in mind and doing first things first. We have, as a government, been developing things, working hard on introducing legislation like Bill 2. We have been doing things like finding out what are the cleanest LNG facilities in the world, what contributes to that, what we can do to make things better, and what we can do to establish good relationships with First Nations and with communities along the pipeline routes, establishing social licence with all the public members in the province here in order to move this ahead.

There’s a myriad of steps that our government has had to take in order to get to the point where we are today, when we can introduce a bill like Bill 2 — and a bill like Bill 6, which will be coming up for discussion later. Those are individual little steps that we’re taking in order to achieve the dream that we’re looking for.

Along the way there are dissenters. We’ve heard much from dissenters, from the members opposite. We’ve heard concern from various environmental groups. Those are the kinds of issues that we are also working very hard to try and come up with, which is habit 4, a win-win relationship. We know there are saw-offs. We know that there are risks to just about everything that we do in life. But we look at LNG as…. Although it’s a fossil fuel, it’s one of the cleanest burning fossil fuels that there is in the world, and we see it as contributing to lowering the overall greenhouse gas emissions worldwide.

The member opposite from Columbia River–Revelstoke yesterday brought up the fact that we mine coal in British Columbia, and coal amounts to a significant part of our GDP in British Columbia. But we mine metallurgic coal. Metallurgic coal is one of the cleanest-burning coals in the world, and it’s used in the manufacture of steel. That’s it.

Without steel, then, we couldn’t be building pipelines. We couldn’t be building the bridges that we have. We couldn’t be building the highrise apartments that we have. We couldn’t be building the new ferries that we need. We couldn’t be doing a whole lot of things without steel and without the metallurgic coal that this province is so widely renowned for around the world. Now we’ve got India that is looking at buying metallurgic coal from British Columbia. I think that’s a good thing.

There are saw-offs on either side. We say that we’re going to develop an LNG industry that is going to be the cleanest LNG industry in the world. So we set these experts out, looking around the world, to find out what that means, what that looks like at the end of the day. We set a level of greenhouse gas emissions that is lower than any other LNG facility in the world. And that’s just to start. As technology progresses, that level is going to come down — lower and lower every year, as technology improves some of the systems that we have.

It’s a win-win. There are some people that will never see this as a win-win kind of a solution — that do nothing and wait for somebody else to come up with the good ideas, as long as it doesn’t involve fossil fuels and digging things out of the ground and changing the world. There are others that will say: “Okay. When I turn my natural gas stove on in Vancouver” — or Victoria or Kelowna or wherever it might be — “and I turn the thermostat up in my house to get warm, I guess I can handle that. I know that this LNG is going to help lower the greenhouse gas emissions from around the world.”

We know what it’s like when we get a forest fire in some remote part of British Columbia here, and the smoke filters down into Vancouver. It filters down onto the Island. In some cases we’ve had forest fires in Russia, and the smoke has come over the top and down into Canada from up there. So we do know that particulate matter travels around the world, and it’s a global issue.

British Columbia is going to step up to the plate in a big way and help countries like China and other countries eliminate the use of coal-fired generators and come up with a clean-burning solution that is going to make the atmosphere and the air better for everybody around the globe.

We also have the fifth habit, which is one of the ones that I really try to subscribe to in a big way. It’s called “Seek first to understand, and then be understood.” Now, I look at it this way. The Creator has given us two ears and one mouth. So I do a lot of listening.

[1345]

I don’t talk a heck of a lot. People have accused me of being a very quiet individual, in fact. It’s unusual for me to get up and kind of ramble on like this. But I do a lot of listening to hear what people are saying, to try and figure out where they’re coming from.

For the life of me, I’ve been sitting here now for a year and a half, roughly, and I’ve been listening to the members opposite, some very fine men and women sitting across from the room from me here. But I’ve yet to understand what their solution is to all the problems that we have. I’ve yet to understand and figure out what their solution is to increase health care in the province and lower the cost, to look after our education, to look after our mental health and addictions.

What’s going to support that? Where is this money going to magically appear from? I’m still really struggling to understand that, and I would like to really hear how the members opposite plan on doing that.

Habit 6 is to synergize. To synergize is to gather as many like-minded people together and get the benefit of everybody working in the same direction. This government — we’ve got a great leader with the Premier. The Premier has articulated her vision very well to those of us in government. All of us share that vision, and we all have ideas that are contributing to the pot to enable us to achieve this dream — this pipedream, as I’ve heard it termed across the hall there.

We’re synergizing, we’re working together, and that synergy actually manifests itself down within the civil servant part of government, where we have members of the various ministries working hard together to try and achieve that goal and that vision that the Premier has articulated so well. That’s working. It’s going to benefit everybody in British Columbia.

Then the seventh habit of highly effective people is sharpening the saw — continually reinvesting in education, continually learning about all the latest and greatest technologies and things that are happening in the world, not just in Canada and not just in British Columbia but in the world. So when we do develop this brand-new LNG industry in British Columbia, that is going to be a world-class facility — world-class plants, world-class pipelines and world-class support in order to make sure that they are running as safely as they can in today’s world and as efficiently as they can in this world.

That’s what synergy is all about. Everybody’s got their oar in the water, and they’re rowing in the same direction. Their timing is right, and the canoe is travelling straight and true and fast. That’s what synergy is about.

Stephen Covey wrote his last book — the late Stephen Covey; he passed away a few years ago…. He wrote another book that was called the 8th Habit that he gave me as a gift when I retired from the RCMP. The eighth habit is: find your voice and inspire others. That’s exactly, again, what our Premier has done. She has found her voice, and she’s very inspiring, not only to those on the government side, but she’s also inspiring to the general public as a whole.

She has an ability to get her ideas out, to throw her vision out there so that everybody clearly understands where we’re coming from, clearly understands what her dream is and how she’s going to bring it to reality and how she’s going to make British Columbia a better place for my children, for your children, for our grandchildren and for future generations to come, based upon this 150-year supply of natural gas that we have in British Columbia that we’re going to turn into a brand-new industry.

That, in itself, is going to start a chain reaction with other industries downstream, with the petrochemical industry as a whole. And who knows what British Columbia is going to be on the map for ten, 20, 30 years down the road. It’s going to be a world leader in technology, it’s going to be a world leader in liquefied natural gas, and it’s going to be a world leader in a vast number of areas because of the education system and the health system and all the other support systems that we’re going to have in this province as a result of LNG.

Bill 2 is one step in the process. We’ve got Bill 6 coming down the road, which is another step in the process.

[1350]

I think we’re going to see here very quickly, within the next few months, that this pipedream is going to start to come together. To the other side of the House: quite frankly, I hope that you can understand where we’re coming from and start turning your nightmares into dreams as well. I’m supporting Bill 2, and I think it’s the only way that we can go in this province.

L. Krog: Yesterday I was highly critical of the members opposite during the course of the debate around the hoist motion, because I said that the problem with this place is that in order to have a debate, you actually had to have an exchange of views.

Deputy Speaker: Member, would you please take a seat. An introduction needs to be made. Sorry.

Hon. N. Yamamoto: I seek leave to make an introduction.

Leave granted.

Introductions by Members

Hon. N. Yamamoto: Earlier this morning I introduced a grade 11 class from Bodwell High School in my riding of North Vancouver–Lonsdale. This is the second class that has come in to watch the proceedings today. This is Mr. Smith’s grade 11 social studies class. Bodwell High School is an international high school and has students representing 40 countries from all over the world. In this particular class we have students from seven different
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countries, and probably eight including Canada. I would ask that the House please make them welcome.

Debate Continued

Deputy Speaker: The member for Nanaimo will continue.

L. Krog: I just want to make sure that every member opposite has a chance to listen, particularly the member for Prince George–Mackenzie because I want him to know that I have listened carefully to what he had to say in the last few minutes. I think it’s important in the spirit of what I said yesterday. The problem with this place and the debate around the hoist motion was that there wasn’t an exchange of views, because none of the members opposite seemed to be speaking.

I wanted to spend a little bit of time responding to what the member for Prince George–Mackenzie just had to say. I was very intrigued — and it’s not an admission I would ever make in a public place — that he said he wasn’t that comfortable, or something to that effect, speaking in public. I thought to myself: “Well, for heaven’s sake, then why did you bother running for the B.C. Liberals to sit in the B.C. Legislature if you’re not comfortable speaking in a public place, because that is ultimately what you’re required to do?”

He did say, however, that the good Lord, or something to that effect, gave us two ears and one mouth. I understand that. It’s a wonderful Mark Twain quote, and I agree with it entirely, particularly when you deal with your constituents. But what troubled me was when he said: “What’s their solution? I don’t understand. I’ve been here for a year, and I don’t hear the solutions from the opposition.”

I thought to myself that question period today would have given him a broad hint about why he doesn’t hear a pile of solutions from the opposition. Our job in this House — and this is a little lesson in politics and parliamentary tradition and history…. We are called Her Majesty’s Loyal Opposition for a reason. Our job is to oppose.

Interjections.

L. Krog: Oh, I hear them. I love this, hon. Speaker. I hear them. We are trumpeting about liquid natural gas hour after hour in this House, and some of the politicians sitting in this very side of the House, on the opposite side of the House and over to my left…. Those are the folks who in the ’90s voted against the Oil and Gas Commission, for heaven’s sake, that led to prosperity in the northeast of the province of British Columbia.

I can’t believe it. Let’s step back a moment and illuminate for the member for Prince George–Mackenzie that the job of the opposition is to oppose and to criticize and to question and not take anything that the government says at face value. Again, I come back to the Oil and Gas Commission. I mean, all of those wonderful B.C. Liberals voted against that.

Now, is the member for Prince George–Mackenzie and all of those who have gone suddenly quiet….? They must be listening to me. That’s delightful. Do he and all of those members on the other side somehow feel a little chagrined now that that’s been pointed out to them — that they voted against something that led to the incredible generation of wealth and economic activity in the northeast sector of the province of British Columbia? Are they suddenly now feeling chagrined that maybe their political ancestors and some of the members opposite who did actually sit here and vote against it…? Are they feeling chagrined or apologetic? Is that what I’m sensing today?

As we debate Bill 2, the Greenhouse Gas Industrial Reporting and Control Act, they somehow think that our job is to just tell the B.C. Liberals how wonderful they are and how good this legislation is and that we should support everything the Premier says?

[1355]

I mean, if ever I heard a Freudian slip today, it’s when the member said this pipedream is going to come together. I didn’t take psychology in university, but I just thought if there was ever a Freudian slip that popped out, “this pipedream coming together” might have been one of the best lines I’ve heard here in a very long time.

It is for that very reason that we have concerns on this side of the House. We have heard the promises. We are looking now at two pieces of legislation that deal with this. Frankly, given what we were told not that many months ago about the amount of revenue and what was promised in the trillion dollars in economic activity and the elimination of the net provincial debt and all of those things…. Now suddenly we’re being told, “Well, actually, that tax rate — we’re going to cut that in half,” and the revenue projections aren’t quite what they used to be.

Is it any reason that the members of the opposition would stand in this place and question what’s being said in the Greenhouse Gas Industrial Reporting and Control Act? Is it any surprise?

When the minister introduced this bill, she said that it will be the cleanest in the world, with reference to our liquid natural gas industry — the cleanest in the world. She gave it all of two minutes of great support and then sat down.

The cleanest in the world — what does that mean? Is that a standard that was set by some international body of scientists? Is that something that’s agreed on by all the politicians in British Columbia? Is it the decision of cabinet or the judgment or evaluation of cabinet? I mean, who determined that it’ll be the cleanest in the world? In fairness, how do we look at that?

The production of liquid natural gas is a series of
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things. I said yesterday it was like talking about a part of a ten-link chain. The production facility is actually just one link in a long chain. There’s the fracking. There’s the transportation. There are the pipelines. There’s the plant itself. There’s the transportation to market.

So when we hear the hyperbolic phrase “cleanest in the world,” what exactly does that mean? Does that mean because of this legislation? Does it mean, as I say, because we have heard this from some other source? Or is this some evaluation? Or is this a judgment call?

Why the opposition has trouble with this bill is because of what we’ve been told and what the government has already reversed itself on. We have gone from this wonderfully prosperous future where liquid natural gas was going to solve everything — back in February, 7 percent, and now we’re down to 3½. We’re bargaining ourselves into the basement.

It seems to me we’re becoming like those characters in a Victorian novel. We’re being forced to live in reduced circumstances. It’s probably a good thing we’re getting the bill in the House now. By next spring it might have been down to a 1 percent return. We’re not exactly going in the right direction.

The member for Prince George–Mackenzie talked about dreamers and nightmares. Again, I thought that was particularly apt, because in order to have dreams and nightmares, you have to be asleep. You have to be unconscious. It’s not something that happens during your daylight waking hours when you’re alert to the world.

I must say, with great respect, that our sense over here is…. We don’t believe the government is asleep, and we don’t think they’re necessarily dreamers. We don’t, in fairness, think they’re necessarily the worst nightmare either, but there is a certain amount of fantasy involved in the proposition around liquid natural gas.

All we’re saying on this side of the House is that if you’re going to develop a scheme that is supposed to make this the cleanest in the world, whatever that may be — we can talk a long time about whatever that may be…. If you’re going to do that, then let’s talk reality.

[1400]

What exactly does it involve? Is it going to happen? Is there some scheme or plan that’s laid out and articulated, supported by scientific evidence or supported by scientific panels or supported by experts that tell us whether or not, in fact, this is even remotely true? That’s the problem.

The member for Prince George–Mackenzie said our Premier is inspiring. Now, I’ve said it many times in this House since the last election: they won; we lost. This is where they get to clap if they want to, if they’re listening. Not even going to bother. Their campaign beat our campaign — no question about it. First to admit it, although the good people of Nanaimo — bless them, each and every one of them — actually re-elected me. I am grateful for that, and I want to repeat that in this chamber while I’m here.

Inspiring is one thing. Delivering is another. You have to use that phrase my friend from Surrey–Green Timbers is always using. You have to be prepared to walk the talk. That’s where the opposition doesn’t sense that the talk is actually being walked. It’s certainly not being walked in this bill.

I can’t help but think, as I said yesterday, that Gordon Campbell would have a lot of trouble with this. You know, it was only six years ago that we had the climate action plan rolled out. We were going to be a world leader. The province was in the midst of heady times financially. The government still couldn’t afford to stop clawing back maintenance payments from children, but that’s another story. They couldn’t raise assistance rates, and they couldn’t put money into public education the way it needed to be done, but I won’t go on too much about that.

Things were looking fairly positive, and you know what? I think most British Columbians, whether they supported the government or not, or voted for the government, liked the concept that their political leadership — on both sides of the House, for that matter — was actually coming to grips with the issue of our time, and that was climate change.

I think most British Columbians supported it. There may have been arguments around the gas tax as an instrument. There were certainly arguments around those sectors of the economy to which it didn’t apply — the climate action plan generally — but clearly, in 2014 it’s safe to say, and forgive me for saying it, that that’s a vehicle that’s literally run out of gas.

We’re not going to be talking about that anymore, because the Greenhouse Gas Reduction (Cap and Trade) Act, SBC 2008, c. 32, is going to be repealed in section 55 of this bill. Our great desire to be a world leader — a leader within Canada as well, for that matter — is dying with this bill.

Now, why is that happening? Is it because the Premier is particularly inspiring? Has the pipedream disappeared? Has the fantasy died? I’ve got nothing wrong with dreams. I like a good dream myself once in a while. Gosh knows, those of us on this side of the House fantasize about sitting on that side of the House. We do it all the time. It’s what keeps you going in opposition.

Having said that, hon. Speaker, you have to question: where are we? What is this plan all about? Are there strengths in it? Is it going to be a great improvement? Is it going to fulfil the goals that are talked about? There are, in fact, significant vulnerabilities with this bill.

I’ll come back to my analogy of the chain. This intensity benchmark talked about legislation. It does not apply to any upstream emissions. That’s the flaring. That’s the fugitive. That’s the pipelines. That’s the extraction. That’s all of those other things that go into this process.

Now, the end result may be a somewhat cleaner-burning fuel than coal. We all know what a great effort the U.S. coal industry has invested in, in terms of money, to try
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and convince people that there’s such a thing such as clean coal. It’s almost as wishful in terms of its thinking as the little boy who is told to go and clean up and runs back into the kitchen and shows his little washed hands to his parents and says, “Look, I’m clean,” when, in fact, the rest of the kid is covered head to toe with mud and muck.

[1405]

This is just one portion of that whole process by which we’re going to generate liquid natural gas, and there isn’t any evidence that we’re going to do anything about the rest of the process. When we use that very phrase “the cleanest in the world,” it’s like the Premier’s speeches — full of hyperbole and great promises, everything’s the best, and we’re going to do this, and we’re going to do that. But at the end of the day, when you scrape it away and you actually try to find the truth or research the facts or determine what the facts are, there isn’t anything there. The truth is something quite different. It’s not going to impact the rest of the chain.

Now, if the government was introducing a bill that dealt with the whole process — that was, if you will, an honest approach, a more scientific approach — then the members on this side of the House would be supporting it. I’m sure the member for Oak Bay–Gordon Head, who prides himself on being an expert in this area, might actually be applauding the government. But he’s made it very clear. He’s not happy with this bill.

Now, some have suggested that he was over the top in his remarks. But I’m going to give the good doctor, the member for Oak Bay–Gordon Head, his due. He’s got more expertise in this area than I certainly do. I’m just one of those generalists. I’m one of those MLAs who was elected to speak on behalf of my constituents. I try and learn what I can and pay attention when I can. But he has significant problems with this. Does that not somehow send a message to this government, or the members of the back bench in particular, that maybe this bill isn’t all it’s cut out to be?

Moreover, this bill does not require actual greenhouse gas reductions. We’re promised again by the minister that we’re still going to meet our targets by 2020. Now, how conceivably can you reach your greenhouse gas emission targets by 2020 if you don’t have legislation that covers the entire production scheme involved in liquid natural gas? I mean, how is that going to happen?

Do the members opposite think…? I hesitate to say this — if you open the barn door, some horse might come running through — but do they think we’re a bunch of idiots over here? I mean, do they really think that you cannot require greenhouse gas reductions in the major environmental bill relating to an industry that’s supposed to generate billions of dollars and have us believe this is a sincere effort to mitigate or stop or control climate change?

An Hon. Member: Yes.

L. Krog: You know, hon. Speaker, from that member in particular I’m not surprised he’s working on blind faith on this issue. I would have expected more from someone of such incredible education and ability.

No, we are not going to believe it. We are not taking the government’s word. We’re not going to swallow it on blind faith. That is, firstly, not our job. Secondly, it doesn’t begin to meet the reality of what we’re presented with.

Under this legislation, as well, the liquid natural gas terminals are allowed to emit 0.16 tonnes of CO₂ emissions for every tonne of liquid natural gas exported without any penalty. So there’s a free pass. It’s a “get out of jail free” card. It’s Monopoly writ large on the province of British Columbia, and guess who’s paying. The environment and all our grandchildren and our children. That’s who’s going to pay for that Liberal promise.

With respect to offsets, this plan is not clear at all. Now, I don’t know how fast this legislation was put together, but it is not clear on the issue of offsets. We know that the record of this government on offsets has been pretty grim.

I mean, we do know that part of that wonderful scheme, of course, was our Pacific Carbon Trust. Again, I don’t wish to point out unnecessarily the failings of the British Columbia Liberals, but after a scathing report by the provincial Auditor General, that little puppy was scrapped too. And does anyone in this chamber remember: how many golden goals was it? I can’t remember whether it was the five golden promises or the ten golden goals.

[1410]

All of those things are all sort of washed away now. It’s kind of like they’ve been painted over. It’s like graffiti on a wall someplace in a disreputable part of town that gets painted over every once in a while, and then we see a few more slogans written up, and then they get washed over, and we’re all supposed to forget what’s under the new coat of paint.

We’ve painted up the wall again here with new slogans about the “cleanest in the world.” That’s all we’re supposed to remember. We’re not supposed to remember that the Pacific Carbon Trust is, pardon the expression, toast.

Now the incentive program. There’s an incentive program. I defy any member opposite to stand up here and explain to me what that incentive program is all about. If they can, I look forward to it. I know the minister is going to get a lot of assistance in this, I’m sure, when it comes to committee stage of the bill.

As I said yesterday, notwithstanding our hopes that the member for Oak Bay–Gordon Head might have been right, the member for Columbia River–Revelstoke and myself did indicate that we were probably going to lose the vote. We accepted that. So we’re probably going to get to committee stage of this bill. I think that’s fair to say.

Moreover, details on the technology fund. They’re not available.

I come back to a point I made earlier. Meeting our
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legislated greenhouse gas reduction targets with this, the way it is before this House, is, I think, in fairness, and I say without exaggeration, highly unlikely. Highly unlikely that we’ll be able to meet those targets.

Moreover, this bill lacks the usual details, and it grants the government ability to change rules at any time by way of regulation. I talked about that at length yesterday. Giving governments a blank cheque is not what we do here. When I made reference yesterday to the Lieutenant-Governor thanking us in Her Majesty’s name for our benevolence, the concept is you don’t get to spend money or change rules or do things without the consent of the people, through this Legislature. Basically, a quarter of this bill says: “Let cabinet decide.”

I see another bill just introduced today, the Miscellaneous Statutes Amendment Act, giving more power to cabinet around the agricultural land act. This is a continuing and worrisome trend.

This bill, for that reason alone, isn’t worthy of support. If we continue to do this, then this place loses, frankly, its power, in a sense, its authority on behalf of the people and its ability to represent the people.

You know, there’s a paper out right now, a draft of a new Society Act. It contains a provision that allows groups or persons or people who feel they’ve been — I forget the exact language — we’ll say, unfairly dealt with by a society, or the society is not acting in the public interest. It allows people to bring suits against societies — so, not-for-profits. Whether it’s a society devoted to assisting women who have been beaten and abused or whether it’s a society to raise money for a cure for cancer or whatever, that legislation will allow those societies to be dragged into court by people with axes to grind.

Now, that’s not a healthy thing for democracy. Frankly, it’s the job of politicians to set the rules, and it’s the job of government to regulate conduct in society. That’s what we do here. But that power to regulate and manage conduct in society, if you will, is one that is reserved to this Legislature. It should not be reserved to cabinet.

What this bill proposes to do is to give enormous authority to cabinet to make those decisions, without resort to seeking not even so much as the opinion of the people by putting it before the members of this assembly — not even so much as the opinion — or to face a legislative committee even.

I mean, even if it proposed that it face a legislative committee, where all members could participate and raise their voice on behalf of their constituents or the people who’ve tried to educate them and illuminate them about the topic…. It doesn’t even go that far.

[1415]

It is all about, and this bill is all about, the power of cabinet — in the security and quiet of that chamber, which is not open whatsoever to the public — to make those decisions.

Now, I hesitate to bring up open cabinet meetings, of course. You might remember that was another great promise of Gordon Campbell’s: we’d have open cabinet meetings.

Just like the slogan, the graffiti on the wall, that one got washed away and wiped over too. We stopped having open cabinet meetings because it became sort of relatively apparent that there was the dress rehearsal before, and then everybody came in and ran through the cliché and played-out lines. Then the real stuff got talked about the way it’s always been discussed: in the privacy of the cabinet chambers.

The objection of the opposition is to that very process. We want to be able to have things debated in this place. Let government face the criticism and the scrutiny before the decision is made, not after. Let it receive the kind of publicity that this place lends itself to.

I mean, I’m not going to pretend for a moment there are a lot of British Columbians watching me speak today, much as I’d love to flatter myself.

Hon. S. Anton: Thousands.

L. Krog: My friend the Attorney General, my former classmate, says: “Thousands.” There may be a few thousand, and that’s delightful. But it’s not 4½ million.

Interjection.

L. Krog: The member for Saanich South says her mother is, too, so we’ve got thousands plus one.

But at least there is that opportunity. There is at least that opportunity that British Columbians can tune in and see what’s being said here and understand who we’re advocating for or what cause we’re advocating on behalf of. Whatever we’re doing, it’s open to public scrutiny. That doesn’t happen in the cabinet chamber.

I know everyone wants to sit around the cabinet table. You don’t get into this game just to sit in the bleachers all the time and cheer for the team. You want to get around the cabinet table. I understand how the system works. So that has a certain calming and mediating effect on people in terms of their behaviour as members of political parties. But we don’t want to so degrade the system by taking it out of the light of the public, out of the daylight, that the system becomes meaningless.

That’s what this bill is essentially proposing to do: give some more power to cabinet — more and more power to cabinet. As that power grows and grows, it becomes harder and harder for change to be made — in terms of good change, arguably — and for bad change to be stopped or criticized.

Speaking to those conscious British Columbians about the fantasy behind this bill, I just want to say that, surely, the B.C. Liberals can do a better job. I know that they love to pretend that the opposition is opposed to development of liquid natural gas. I know they want to do that, and I
[ Page 4882 ]
know that they get little instruction sheets and their prepared speeches that tell them to trumpet this over and over again. I get all that.

But, you know, if they actually listened to the members on this side of the House, what we’re saying is that we see potential and we see opportunity, as well, but let it be done in a sensible way that respects the rights of First Nations, that respects the environment, that respects our children and our grandchildren’s right to live in a society that is both free and prosperous and one in which they can be, generally speaking, healthy because they can still breathe the air and drink the water.

That’s not an unreasonable proposition. I know, in the hyperbole, I’m just as guilty as every other member. I understand that’s not the basis on which we’re going to discuss this. What we are saying as an opposition — if you look at this bill and understand its implications and what’s being asked, it’s just too much.

It is not in accord with the thinking of British Columbians. They have come a long ways. They understand better now that climate change is real, that something has to be done. Gordon Campbell got it. It’s clear this Premier doesn’t. I would hope the members opposite do, but if they honestly believe that this bill is going to help reduce greenhouse gas emissions and build a bright future for British Columbia in the form in which it is, I just have to say, my view, they’re wrong.

[1420]

Unfortunately, the price to be paid for being discovered and determined to be wrong will not be paid by the members opposite. It will be paid by all of those British Columbians who are looking to government, to the members of this assembly for leadership on the leading issue of our day.

They’re the ones who are going to pay the price. They’re going to pay the price economically. They’re going to pay the price environmentally. Those who are already suffering socially and are losing in every way, shape and form the fight for social and economic justice are the ones who are going to pay, because this bill doesn’t do the job that it should.

I look forward to further debate on this bill from the members of this chamber, but I for one cannot bring myself to support this legislation in the form in which it is.

Deputy Speaker: The member for North Vancouver–Seymour [Applause.]

J. Thornthwaite: I like that — having not said anything. Hopefully I’ll get that at the end.

This government supports responsible resource development and the highest safety and environmental standards. That has been proven time and time again.

The Premier said, with regards to the conditions to do with LNG companies in British Columbia a couple of weeks ago, that the conditions are this. You have to pass the environmental review, there has to be the best environmental protection on land and on water, there has to be First Nations involvement, and there has to be significant economic benefit for British Columbians.

Our commitment to the cleanest LNG has not wavered from this. Our government promised the cleanest LNG facilities in the world, and that is exactly what we’re delivering in this bill. This government will be a global leader in clean LNG because our facilities will address greenhouse gases to a higher standard than any other LNG facility in the world.

Our government acknowledges British Columbia is choosing a more difficult path to greenhouse gas reduction. Why? Because we’re going to reduce our greenhouse gases while supporting a strong and growing economy that includes a thriving LNG industry.

I was struck by the comments of the member for Oak Bay–Gordon Head when he said that we can have a healthy environment and a strong economy. He recognized that job growth has occurred, economic growth has occurred, the GDP has gone up — all while reducing greenhouse gases from 2007 to 2012.

Our government will seize global leadership by reducing greenhouse gases while adding jobs and stimulating economic growth. As was mentioned times before, we already announced in June that we had reached our first interim greenhouse gas emissions reduction target of 6 percent below 2007 levels by 2012.

In contrast to the naysayers from the other side, we actually do deliver what we promise. The Premier, again, had mentioned before that we were not expected to balance the budget, and we did. We were not expected to balance the budget again, and we did. We weren’t expected to maintain our triple-A credit rating, and we did. We were not expected to have a settlement with the teachers, and we did. I’d like to just reiterate that we are promising the world’s highest standards of LNG, and we will commit to that promise.

The time is right to build on the success by revitalizing our climate action plan to reflect B.C.’s climate leadership in the context of a strong and growing economy. Where natural gas replaces other fossil fuels, lower greenhouse gases and improved global air quality will follow.

From this LNG emissions benchmark that I’ll discuss in a moment in this bill, British Columbia will see investments in B.C.-based offset projects, including forest management, natural gas vehicles, community energy systems, industrial energy efficiency and waste management projects.

[1425]

The offset provisions for carbon-neutral government under the Greenhouse Gas Reduction Targets Act will be repealed so that there is a single standard for B.C.’s offsets.

B.C.’s world-leading benchmark will limit greenhouse gas emissions to 160,000 tonnes CO₂ emissions per million tonnes of LNG produced. These are the lowest emissions of any similar facility in the world. British
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Columbia is committed to having the cleanest LNG facilities in the world. The province actually surveyed leading LNG facilities worldwide — Australia, the United States, Norway — and determined that a 0.16 benchmark would have a clear and lasting justification to be called the cleanest LNG facility.

A benchmark is a regulatory tool that sets an absolute limit on greenhouse gas emissions for every unit of LNG produced, while allowing for the growth and development of the LNG industry in B.C. In this way, a benchmark provides an economically efficient path to meet the goal, the province’s goal, of having the cleanest LNG facilities in the world. The benchmark will cover all greenhouse gas emissions, from the point where natural gas enters the plant to where it is loaded into a ship, train or other transportation system for delivery to the market.

By studying the greenhouse gas emissions of leading global LNG facilities — again, in Australia, Norway and the United States — along with independent research, B.C. has established that no other LNG facility in the world will have greenhouse gas emissions intensity as low as 0.16 tonnes CO₂ emissions per tonne of LNG produced. An LNG facility in B.C. that meets that benchmark through efficient plant design, investment in emission reductions or its clean technologies will have a clear claim for the world’s cleanest LNG facility.

As mentioned previously, in June 2014 we announced achievement of our first interim greenhouse gas emissions reduction target, of 6 percent below 2007 levels by 2012, and we did it at a time when we were growing the economy. It can and it will be done. This government remains committed to first achieving a 33 percent reduction and ultimately an 80 percent reduction from 2007 greenhouse gas levels.

The B.C. government is extremely sensitive to the competitive environment LNG facilities operate in, and it has worked with LNG companies and independent strategic advisers to identify a fair share of benefits for British Columbians. That is our goal, and that is what this bill and the next bill coming up are meant to accomplish.

The development of the liquefied natural gas industry in B.C. is a tremendous opportunity for even more economic growth for British Columbians, but we will not be doing this at the expense or the risk of the environment. That is what the Greenhouse Gas Industrial Reporting and Control Act is designed to protect, and that is why I will be supporting it.

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

Leave granted.

Introductions by Members

Hon. D. McRae: On behalf of the Minister of Children and Families, the MLA for Surrey-Cloverdale, I gather that in the chambers today we have Southridge School from Surrey here. I would ask the House to please make them welcome.

Debate Continued

D. Donaldson: I’m happy to rise today and take my place in the second reading debate on Bill 2, the Greenhouse Gas Industrial Reporting and Control Act, not only to address the bill in a general way, but also because this second reading debate gives us an opportunity to discuss the challenge that is at the foundation of the bill.

As an aside, I would like to say that the challenge that is at the foundation of the bill is climate change. This could not be much more important a topic to me at this time, because less than 45 minutes ago I became a grandfather for the first time. [Applause.]

I’ll continue.

[1430]

I want to make it clear….

Interjection.

D. Donaldson: A baby girl. Yes, a baby girl.

I want to make it clear — because based on the comments we’ve heard from the other side, there are some B.C. Liberal MLAs who believe otherwise — that enhanced climate change is real. It’s real. It’s supported by scientific evidence and by those who make it a career to study the impacts of greenhouse gases on climate. So let’s all agree that this is the starting point for the discussion we are having in regards to this bill dealing with greenhouse gas emissions associated with the emerging LNG sector in this province.

We are witnessing the effects of enhanced climate change already. It’s not something that theoretically could happen in the future. In fact, as I studied the natural sciences in my undergraduate degree, it is something that has become a reality within my lifetime. I say “enhanced” climate change because western science has shown us that climate does change on this planet due to natural factors, often in a cyclical way.

What is different today is that due to man-made factors since the Industrial Revolution, and the dumping of large quantities of greenhouse gases like carbon dioxide, methane and nitrous oxide into the atmosphere, we have enhanced those natural cycles so that they become more rapid, extreme and unpredictable. Rapid, extreme and unpredictable climate patterns are not the ways that plants and animals evolved on this planet to become best-equipped for their surroundings.

There were some very rare catastrophic events that resulted in mass extinctions on a global basis due to potential causes such as meteor impacts. But these are not events that we should be willing to replicate due to our
[ Page 4884 ]
actions — actions that can be changed by means such as voluntary behaviour and through thoughtful legislation.

When climate change takes place rapidly and persists, we see problems. Plants cannot adapt quickly enough, for instance. Those areas where we are growing food — for example, with the help of irrigation — become unfarmable. That is what we are witnessing in California, where 70 percent of the massive food production area has been under drought for three years. Previously a breadbasket, that area is parched, and we are witnessing desertification.

That’s not a minor point when we consider how much of our food comes from California and Mexico. It’s a major reason why we see food prices jumping at our local grocery stores. It’s another important reason why agricultural land in this province needs to be cherished and protected, unlike the direction this government has taken us with changes to the agricultural land reserve.

In the northwest, salmon have evolved in an environment where water temperature has a huge impact on their ability to survive. It appears the failed sockeye run on the Skeena River last year, which had a huge impact economically and huge human consequences, had a lot to do with what happened to these fish when they were in the open ocean, where rising temperatures have decreased the amount of food for the developing sockeye and warmer temperatures have increased the range of competitors and predators from further south.

We know that increased river temperatures have significant negative impacts on spawning salmon and also on egg and fry survival. It’s partly why an NDP government in the 1990s introduced legislation to protect riparian zones from clearcut logging in order to keep those spawning salmon streams clear and cool.

Unfortunately, in the last 12 years we’ve seen this government turn to self-regulation by large forest companies for preventing such practices. We see increased incidents of poor results, once again, on the land as a consequence.

Underlying Bill 2 is the recognition of enhanced climate change — the incredible negative social and economic consequences that we are witnessing of increasing greenhouse gas emissions from industrial activity and the need to do something about it with respect to the emerging LNG sector. That is what underlies Bill 2.

But what we have in front of us really amounts to a whole lot of nothing. You will hear from this government about an intensity benchmark of 0.16 carbon dioxide equivalent per tonne of LNG produced and the cleanest LNG facilities in the world.

[1435]

But this bill is hardly a bill at all. Nothing in it concerns the statutory obligation. In other words, nothing in it is set in stone, as one would expect for a law governing GHG emissions. It’s all about regulation. For those who may be watching or listening or reading this later, here is how that works.

A proper piece of legislation would give details about exactly what the law does. In Bill 2 all those details are left up to regulations to be established at a later date by this government on its own and approved by the cabinet, not in front of this Legislature where some scrutiny and oversight can take place. It’s a trust-me approach.

After this government having Mount Polley happen during their watch; after this government passing legislation to allow industrial activity in parks while saying nothing about it before the election; after the government passing legislation weakening the agricultural land reserve after saying nothing about it before the election; after this government saying there’ll be no thing called the HST and then attempting to bring it in after the last election previous to 2009; after ripping up teachers’ and other public servants’ contracts and being told by the Supreme Court of Canada that they were wrong, do you think a trust-me approach by this government is something that deserves the support of fair-minded people? I don’t think so. I don’t think so at all.

Let’s have a look at Bill 2. Part 2, “Emission Reporting,” section 2: “If required by the regulations....” Part 3, “Emission Control” — “Compliance Obligation,” section 4: “…in accordance with the regulations….” Section 8 of “Emission Offsets”: “…the process established by regulation….” Division 6, section 20, compliance unit transactions: “…in accordance with the regulations….”

Hon. Speaker, you get the picture. In fact, 21 times in this bill “in accordance with the regulations” is mentioned; ten times, “the regulations”; 14 times, “may make regulations”; five times, “if required by the regulations.”

Where are the regulations? They’re nowhere to be found in the bill. It’s absolutely ludicrous. Now, the problem with regulations is a well-known issue. A learned person wrote an article called “Oversight of Regulations by Parliamentarians.” This was in the Canadian Parliamentary Review, winter of 2010. It was a very well balanced article, and the author of that article is the hon. Speaker in this House. She wrote an article, well balanced, on a review of an oversight of regulations by parliamentarians.

She pointed out some of the pitfalls of regulations, and I’ll read from her very learned text.

“Since regulations are often drafted by a sponsoring department — often through consultation with officials, stakeholders and experts — to be later approved by cabinet, the potential exists for an act to be implemented through regulation in ways that depart from the spirit or original intent of an act previously endorsed by a parliament.”

Then she goes on to say:

“A second point pertains to the fact that delegated legislation” — in other words, regulations — “generally receives less attention and publicity than acts of parliament. This has fuelled concerns that delegated legislation may allow governments to enact significant or controversial statutory changes without due parliamentary debate or public scrutiny.”

That’s exactly the potential for what exists with this bill. Why are we concerned about this? Well, regulations are dealt with by the cabinet through orders-in-council behind closed doors, without the public scrutiny of what happens
[ Page 4885 ]
in this Legislature.

[1440]

A fine example of this happened just last April. This government, through an order-in-council, decided to let certain natural gas production facilities be exempt from the environmental legislation oversight. They gave exemptions to new natural gas production facilities in this province through an order-in-council. It wasn’t debated here.

It wasn’t given the public scrutiny it deserved, and there was an outcry — an outcry publicly, an outcry from the Fort Nelson First Nation, who were hosting an LNG summit at the time. Chief Sharleen Gale stood up and asked government officials to leave. She said it was a disgrace. I was in Moricetown listening to the Minister of Natural Gas and the Minister of Aboriginal Relations and Reconciliation fall all over themselves with apologies: “This should never have happened.”

That is the danger of regulation. That is the danger of what we see in Bill 2. That is the danger that the thoughtful hon. Speaker of the Legislature pointed out in her article. What we need is an open and honest discussion — a transparent discussion. That is not what we are having. That’s what people want to hear. That’s what First Nations want to hear.

The Wet’suwet’en have major concerns about natural gas pipelines through their traditional territories — pipelines that could serve as potential LNG production facilities that Bill 2 is referencing. They want to know: what is the province’s, this government’s, energy plan? How are the Wet’suwet’en, with their aboriginal title, going to plug in or have comment on or benefit from that energy plan? That’s unknown. This government has not come up with that. That’s a lack of transparency and not having an open and honest debate.

What we have to do is speculate on how this bill might work, since everything is in accordance with regulations — 21 times, yet not one regulation is spelled out in the legislation. How might this work? Well, we have to speculate, because there’s nothing in statutes in the bill.

In fact, the 0.16 CO₂ equivalency per tonne that this government seems so proud of is only mentioned once in the legislation, on the final page, under a schedule of regulated operations and emission limits. That’s where it’s mentioned. No other time in this entire document.

Why is that a concern? Well, guess what. Schedules can be changed by regulation. The government, who we have already seen is prone to using orders-in-council to go against the wishes of most people in this province, could use an order-in-council to amend, rescind, change that schedule without any debate happening here in front of the Legislature, where people should have a good idea of what this government is up to, what the legislation is up to.

We see that the 0.16 limit is barely touched upon in the bill. We also see that the bill…. Just as an aside, just before that schedule on the very last page, where the only number listed in regulation to greenhouse gas emissions in the entire bill is, on the last page…. We see just previous to that that, in section 55, the Greenhouse Gas Reduction (Cap and Trade) Act from 2008 is repealed. The act that was supposed to go hand in hand with the carbon tax to actually help reach our carbon emission goals in this province — well, it’s repealed now. That’s the legacy now of this government, of this B.C. Liberal government.

We have the 0.16 mentioned once in the document, and then we hear about some other details, important details, about how this might work. Important details about a flexibility between 0.16 CO₂ equivalency per tonne and 0.23. Where is that? It’s not in the bill. It’s nowhere. It’s in a press release that accompanies the bill.

The government is enacting legislation through press releases that have no statutory obligations, and they say it will all be taken care of by regulation at the end. What we see is LNG facilities that are free to pollute under Bill 2 and dump carbon dioxide emissions into the air up to 0.16 CO₂ equivalency per tonne.

[1445]

If we are able to believe what’s in the government news release, between 0.16 and 0.23 we see subsidization of up to 50 percent of the penalty if companies do not reach that 0.16 threshold. They might end up paying 50 percent of a penalty up to 0.23 and have to buy offsets for the other 50 percent or contribute to a yet undefined technology fund — again, undefined.

Why are they so afraid of putting these kinds of details in a bill? That would be a question I think a fair-minded person in the province would ask. If you’re so proud of a potential technology fund, why would you not put stipulations, statutory obligations in law, in the bill?

Above 0.23 companies have to buy offsets — that’s what we can learn from the news release; it’s not in the bill — or contribute fully to a technology fund. But again, very undefined, through regulation. Some people have typified this as not addressing the LNG greenhouse gas emission issue. It’s companies being able to buy their way out of polluting. “Trust them.” That’s all we hear. “Trust them with the offsets.” Well, we’ve seen a pretty bad track record on offsets with this government already with the Pacific Carbon Trust fund.

The other part of this bill that’s dismaying is that the full cycle of the LNG sector industry is not established. Think about how ludicrous that is. You’re saying we’re going to have the cleanest LNG in the world. The plants contribute 30 to 50 percent of the carbon emissions, the greenhouse gas emissions, of the potential LNG sector in this province.

The upstream activities associated with LNG contribute anywhere from, perhaps, 50 to 70 percent of the total carbon pollution from the industry. This involves extraction activities at the wellhead, upstream combustion, flaring, fugitive emissions. When you’re fracking, you don’t
[ Page 4886 ]
necessarily capture all the methane that’s coming up, all the gases that are coming up. So what we have are potentially 70 percent, by some studies, of emissions involved in the LNG sector coming from upstream activities.

To say that this bill will mean the cleanest LNG in the world is ludicrous. It’s not true. In fact, it’s absurd. On top of it, to say: “Well, the part that’s even going to be better is that we’ll ship LNG to China, and they’re going to reduce their emissions….” Well, get a grip. That’s what I say to the MLAs on the other side. Get a grip.

China has unbelievable energy needs. I sat in on budget estimates, where our leader was asking the Premier last spring: are there any agreements B.C. has with China that if we do export LNG to that country, they will decrease their coal-fired plants for electricity? No. None. So again, just a fallacy that that’s going to occur. “Get a grip” is what I say.

Getting back to the actual bill, this government has been talking about LNG for two years, and this bill is the best this government can do? Regulation, regulation, regulation to be determined at a later date. I’d venture to guess that a few aspiring lawyers at the University of Victoria Environmental Law Centre could have put together this effort in about a week. What Bill 2 represents is this government’s sole focus on LNG instead of any other vision and at the cost of other economic sectors in this province.

Just imagine for a minute a government that was focused on forestry as well. Instead of raw log exports at record-breaking rates under this government, perhaps we would be able to see tax incentives and penalties to encourage value-added in B.C. so we could recoup some of the 30,000 jobs that have been lost under this government in the forest sector.

[1450]

Or, perhaps, imagine a government that was focused on forestry that would look at fibre piles — piles of wood that are being burned, as we speak, in the northwest that can be used for jobs, for pellet plants and other kinds of value-added facilities. Right now they’re being burned, under this government, and they’ve done nothing about that legislatively. Instead, their sole focus on LNG has led to lost opportunities in forestry.

Imagine a government that was more focused on mining, as well as forestry, having the wherewithal to actually have monitors in the mining sector. Government monitors, as the Auditor General pointed out, are sadly lacking to even monitor the mitigative measures that the B.C. environmental office has put on mining projects to make sure they’re done in a more environmentally sustainable manner.

Imagine if this government had the wherewithal to have the monitoring that was required. Can you imagine the confidence that would inspire? Not just among First Nations and among residents but among investors worldwide in the mining sector in B.C. But no, we have a government solely focused on LNG.

Can you imagine if we had a government that instead of spending two years on Bill 2 — all it talks about is regulation — had paid attention to the agriculture sector? Can you imagine a government that valued farmland and cherished it and defended it instead of introducing legislation attacking it? A government where farmers are supported in what they do, not a government where we have the worst support, for a government, towards farmers of almost all provinces in the country.

Again, Bill 2 is an epitome of government that’s lost its way by solely focusing on a single sector. Imagine a government that could spend some time looking at the fishery in this beautiful province. We have many people who spend money on fishing licences. A part of that is supposed to come back for projects that improve access for sport fishermen and -women to rivers in this province. We haven’t seen that.

Can you imagine the value-added opportunities — a government who’s concerned about more things than just LNG — in the fishery? I think about the commercial inland fishery the First Nations embark upon on the Skeena River and the opportunities that are being lost because this government is focused solely on LNG.

Bill 2 epitomizes a government that has blinders on when it comes to the economy. Co-ops — another area this government has ignored. There’s no one accountable. No one person is accountable for co-ops, in this government. That’s unlike any other province in Canada. This sector, largely made up of non-profits, is a big part of our economy — $11 billion in revenue and 140,000 people working — and it’s ignored by this government as they work feverishly for over two years on a bill that is nothing but regulations to be determined at a later stage.

There’s no certainty for the people of B.C. in this bill — no certainty at all. We have a government bending over backwards trying to offer a global LNG industry certainty when it comes to a tax regime. But when it comes to the people of B.C. around certainty that their environment will be protected, that greenhouse gas emissions will be reduced, there’s no certainty, because Bill 2 does not outline anything other than regulations to be determined at a later date.

I’m going to wrap up my comments, as you would suspect, hon. Speaker, regarding this bill, as one of the poorest efforts I’ve ever seen in this Legislature around the introduction of legislation. Pages and pages of yet-to-be-determined regulation — nothing when it comes to the details that would give some certainty, some comfort for the people of B.C. about a government who’s concerned about climate change, about climate action. That’s why I will not be able to support this bill as it stands and as it is.

[1455]

S. Hamilton: It’s my pleasure to rise in the House today in support of Bill 2. We know this is a very important bill. It’s very important to the future of this province.
[ Page 4887 ]
It’s very important to the future that’s actually up in the gallery today — the young people in this province that are going to rely on us to make decisions that are going to be, hopefully, helping to advance their futures as they grow older and they contribute to this economy and to this province.

Natural gas is by no means a new industry in British Columbia. Our member for Stikine, a little earlier in his dissertation, asked us to get a grip. This government has a grip. This government has a grip on this province’s future. We are seeing that this future is going to be bright and vibrant, and it’s going to benefit future generations in this province.

It’s not just because we believe LNG is our sole focus. It is not our sole focus. We do not have monovision. We are focused on the environment. We are focused on agriculture and small business and jobs and fisheries and forestry and mining. We don’t forget all of that just because we think LNG is the be-all and end-all. There are a lot of other things going on in this province that we are taking responsibility for, and we’re moving this province forward on behalf of the people who live here. We’ve got an unprecedented opportunity to help grow this economy.

British Columbia is the second-largest producer of natural gas in this country, and it’s responsible for 26 percent of Canada’s natural gas industry. In fact, B.C. produced 1.6 trillion cubic feet of natural gas over the last 12 months, and the energy equivalent of that is 270 million barrels of oil. That’s what we’ve been able to offset with the cleanest fossil fuel that we can produce. Because of this, major global companies have shown a strong commitment to B.C.’s natural gas future, and these companies are already making large investments to prepare for LNG exports.

I had the pleasure on Tuesday of joining the Premier in my own community of Delta to announce an expansion of the FortisBC LNG facility — $400 million. They have partners who are going to be shipping LNG all over the world — Asia, up and down the west coast of North America, South America. They’re going to ramp up to 3 million cubic tonnes of LNG to take to places like Hawaii and Brazil and up and down the west coast of British Columbia, to Asia, as I mentioned. It was a huge….

The global demand for liquefied natural gas has doubled in the last ten years, and it’s projected by experts to increase by another 50 percent in the next seven years. Demand is flourishing. B.C. is serious about becoming a stable and reliable source of energy on the global stage. This is one of our classic commitments and, I think, a defining moment for the government in many ways. LNG will diversify our economy and provide a significant source of public revenue for decades to come.

Again, specifically to Delta, anybody who thinks LNG is a pipedream: come to Delta. I’d be glad to take the opposition on a tour of the now Fortis LNG facility. It’s real. You can see it, you can touch it, and it exists. I’m very, very proud to be a member of that community that’s going to help make this industry flourish.

Just to address issues around safety, the facility has been operating safely since 1971. It’s 41 years that that facility has been in existence, and it’s providing gas supply to utility customers during peak periods of high demand, such as cold winter days. We know how many of those we have down here on the south coast. As the operator of only two LNG facilities on the west coast, out of five in all of Canada — the Mt. Hayes facility near Ladysmith and the Tilbury Island facility in Delta — this facility will be equipped to meet the demands of B.C.’s transportation sector, remote communities, industrial customers and the marketplace.

[1500]

We’re committed to ensuring that B.C.’s LNG facilities are the cleanest in the world. Natural gas is the cleanest-burning fossil fuel, as I mentioned. By exporting LNG, B.C. will help to avoid the use of higher greenhouse-gas-producing fuels such as coal.

It was pointed out to me earlier today how much diesel fuel the islands of Hawaii actually have to burn to keep their lights on and to keep them warm at night. It’s astounding. LNG will have the opportunity to replace much of that demand on that bad burning fossil fuel — which is why this bill is so important, as it reinforces this commitment. Our commitment to the cleanest LNG has not wavered.

B.C. is now competing with jurisdictions globally to be part of an LNG supply. Our government promised the cleanest LNG facilities in the world, and that’s exactly what we’re going to deliver. This government will be a global leader in clean LNG because our facilities will address greenhouse gases to a higher standard than any other LNG facility in the world.

We will encourage further investment to reduce emissions in the upstream. Our government is introducing an emissions benchmark with flexible options, including purchasing offsets, and a technology fund, because this is the most effective way to meet the province’s climate goals while ensuring industry competitiveness. Climate change is a global issue, and by exporting natural gas B.C. will supply growing markets with the cleanest-burning fossil fuel.

Our government acknowledges British Columbia is choosing the more difficult path to greenhouse gas reductions because we’re going to reduce our greenhouse gases while supporting a strong and growing economy that includes a thriving LNG industry. Our government will seize global leadership by reducing GHGs while adding jobs and stimulating economic growth.

We have already had some successes in reducing our emissions while growing our economy. In June it was announced that B.C. had reached this first interim GHG emission reduction target of 6 percent below the 2007 levels by 2012. More will have to be done to continue reducing emissions, but we remain committed to achieving,
[ Page 4888 ]
first, a 33 percent reduction and, ultimately, an 80 percent reduction from 2007 GHG levels.

B.C. has been a global climate action leader since we introduced our climate action plan in 2008. Some examples proving our success include lowering our GHG emissions while growing our economy, 48 percent growth in our green tech sector and double the Canadian rate for hybrid vehicle use. Almost one-quarter of LEED gold building projects registered in Canada are located right here in British Columbia.

The time is right to build on that success by revitalizing our climate action plan, to reflect B.C.’s climate leadership in the context of a strong and growing economy.

Where natural gas replaces other fossil fuels, lower GHGs and improved air quality will result. For example, here in B.C. we have an opportunity to reduce our GHG emissions in the transportation sector by making greater use of LNG. B.C. also has opportunities to significantly reduce GHG emissions in the building sector through the use of climate-friendly construction.

From LNG emissions benchmark, British Columbia will see investment in B.C.-based offset projects, including forest management, natural gas vehicles, community energy systems, industrial energy efficiency and waste management projects. This will provide a broad range of new opportunities across all sectors to reduce provincial GHG emissions.

The liquefaction of natural gas is an energy- and emissions-intensive process. We all realize that. We all agree to that. However, natural gas is still part of a global climate solution. Natural gas is the cleanest-burning fossil fuel. I can’t say it enough. As aside from coal, as aside from diesel, natural gas is the cleanest-burning fossil fuel. It’s the responsible thing for us to do to try and promote it, not just here in British Columbia but around the world, for its use.

B.C.’s world-leading benchmark will limit GHG emissions to 160,000 tonnes of CO₂ per million tonnes of LNG produced, the lowest emissions of any similar facility in the world. New measures in every sector are going to help B.C. reach its long-term climate change goals in tandem with the building out of the LNG industry.

The LNG industry is concerned that costs for their operations in meeting the GHG emission intensity benchmark will affect their overall competitiveness. Having the cleanest LNG facilities in the world and protecting the environment is a core principle of our government. It’s only reasonable, then, to be part of the solution by contributing to the additional costs incurred to achieve the lowest GHG output.

[1505]

The LNG environmental incentive program reduces compliance costs for B.C. LNG industries of meeting the GHG performance benchmarks and provides an incentive to further reduce their emissions.

[D. Horne in the chair.]

Natural gas–fuelled compression technology can achieve 0.23 tonne of CO₂ per tonne of LNG produced. Providing an incentive for LNG facilities to achieve a lower intensity of GHG emissions than 0.23 tonnes of LNG produced will encourage the industry to place a greater emphasis on incorporating lower-emitting technology into their plans.

The incentive program will provide a higher percentage of compliance costs to LNG facilities that are nearer to the benchmark. The cleaner the facility, the less they will have to spend on GHG compliance, and that is a huge incentive. In the global LNG market every penny counts, of course, and the incentive program will ensure that B.C. remains an attractive place to invest and will ensure that our LNG is competitively priced in world markets.

The LNG companies can design efficient plants so that they don’t exceed the benchmark or use offsets for emissions above the benchmark or contribute to a technology fund that will be capped at $25 per tonne.

The LNG environmental incentive program will be an expenditure program open to facilities producing LNG in the prior calendar year with eligible offset or technology fund expenses. There are no immediate impacts on the province’s fiscal plan. No expenditures will occur before revenues from LNG are realized by government, and no payments are anticipated before 2019.

The annual cost of the program will depend on the final investment decision of LNG proponents and their respective in-service dates and production amounts. Any funding for the program would be approved by the standard provincial budget process in the appropriate year.

Again, I’m excited about the progress that we’re making, but we need to do so responsibly. This bill ensures that we’re looking out not only for the economic well-being of our province but also the health and well-being of our natural resources and, most importantly, British Columbia as a whole.

L. Popham: It doesn’t give me a lot of pleasure to rise to respond to this bill, and I’ll tell you why. One of the things that I have noticed over the last 5½ years of being elected in here is that the government side of the House is in charge of the entire end result of climate change in our world, as far as British Columbia goes. If we could split the world in two and they could be in charge of their side and we could be in charge of our side, I would have given up on their side long ago, because they’re heading down a path that is extremely dangerous.

I wonder if members on the other side of the House do not believe in climate change. The way that they’re going on about the cleanest LNG and how they’re reducing emissions makes me believe that they can’t connect the dots.
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So 20 years from now, when we’re having such extreme weather events that we’re unable to mitigate them because we haven’t done any planning…. It means to me that they can’t connect the dots.

They will probably stand out in one of these major storms and wonder: “Why is it happening?” It’s like not planting a crop and wondering why you didn’t get any food at the end. For me it’s bizarre, but it’s also sad.

I am 46 years old. I have a 16-year-old son, and he’s in a program at school where they’re learning about climate change. It’s a school in Cordova Bay which is extremely focused on what people can do in the world, how people can make decisions which will result in a better environment for all of us.

I go in and listen to what’s going on in his class. It’s very inspiring, because there are so many students who are so focused on the climate change issue. Then I walk into this chamber, and it’s like I have gone back a hundred years. It’s hard to believe that we are discussing this in this chamber — about the results of climate change and what causes it.

We have a renowned climate scientist who sits in this House, and the government side of the House has basically said: “Sorry, we don’t believe what you’re saying.”

[1510]

Apparently on the other side of the House we have loads of scientists that are experts in climate change. If I had access to a climate scientist who specifically studies climate change, I would take that member a little bit more seriously. On this side of the House we actually believe in science-based decision-making, not Kool-Aid–based decision-making — which is what I’ve been hearing a lot of.

Obviously, to anybody who would read this bill, the main problem is that none of the upstream emissions will be counted. What does that mean? How can I explain how ridiculous that is? What it means is that…. Here’s an example that’s similar. Somebody needs to go on a diet, and they need to cut their calories in half. So the person in charge of the diet says: “Well, we’re not going to count what you’re eating for the first 12 hours of the day, just the last 12, and there’s your cut.” It doesn’t make sense.

This is exactly what this government is doing. They’re not taking into account any of the extraction emissions, upstream combustion emissions, flaring emissions, fugitive emissions and pipeline emissions. How is that possible? I haven’t heard anybody give a good explanation on why that’s possible.

The main topic that I’m going to concentrate on in this bill is around the carbon offsets that will be possible for companies to purchase.

The reason why I’m very concerned about this and why I think the member from Prince George should also be very concerned about this is because all over B.C., around Prince George, there are offshore companies purchasing thousands of acres of land in the agricultural land reserve. These companies are setting up carbon offset programs. So our very valuable land in the agricultural land reserve is now being owned by foreign ownership that’s using it for carbon offsetting.

What do you have to do in B.C. for carbon offsetting? Some of the things you have to do include planting a forest, so our agricultural land is now being planted. It’s being used as silviculture, which takes it…. As offset programs govern, you can’t log these forests for over a hundred years. What they’re doing is they’re taking this land out of our agricultural production for over a hundred years.

We don’t have that much land in the agricultural land reserve. But one funny situation, especially around Prince George, is that this land was Crown land in forest, removed from Crown forest land, transitioned into agricultural land, where it’s now sold to offshore companies that are replanting it and returning it to forest land. How does that make sense? Well, it all makes sense if you look at this ridiculous path that the government is going down.

Now any of the indications that they don’t value agricultural land, from the spring, are ringing true again in this chamber. This is not a new problem, and the member from Prince George knows that. There are members in this House that heard about this situation during the Agricultural Land Commission consultations in the summer. This is not a new situation that’s going on with the ALR land and the carbon offset programs.

In fact, this situation came up in 2008 in a debate between then MLA Bob Simpson and MLA Pat Bell. This was discussed then. This was brought to the government’s attention — thousands of acres of farmland being returned to forest land, owned by offshore companies. Is this the type of carbon offset incentive program that the Liberal government supports?

There are not enough details in the carbon offset portion of this bill. What I know is that it must be B.C.–based. Offset companies must register with the government and receive certification. That sounds good. It sounds like they maybe have covered things off. But here’s the catch. If you’ve had a carbon offset company working in B.C., it can be grandfathered. So these companies that have bought huge swaths of agricultural land can be grandfathered as carbon offset incentive programs.

[1515]

This is what the B.C. Liberals stand for. They don’t care about agricultural land. All they care about is LNG, and they are not considering the results of unintended consequences. This is something that I’m going to be investigating a lot further.

I have contacts around the province that are contacting me because there are a lot of people that are concerned. And it’s not just people who live in Saanich South on Vancouver Island who would be concerned; it’s people all across the province. These swaths of land are from Prince George up through the Cariboo — thousands of acres. I wanted to just mention that today in my response to this bill.

Obviously, I don’t support it. You cannot support a bill on emissions that a climate scientist cannot support.
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He’s given very good reasons. We’ve given good reasons. I don’t support this bill.

The theme that this government has going, as an assault on agricultural land, is something that gets right up the noses of British Columbians. If you’re looking for an issue to lose support on, it’s our agricultural land. If you thought that the spring was a problem for this government, if this continues and this is a reality in this emissions bill, you just wait for the problems you’re going to have.

Deputy Speaker: Through the Chair please, Member.

I thank the member and recognize the member for Abbotsford South.

D. Plecas: On behalf of my constituents in Abbotsford South, indeed the people of British Columbia, I’m honoured to take part in this debate that is literally going to usher in a new era of opportunity and economic growth for our beautiful province. Bill 2, the Greenhouse Gas Industrial Reporting and Control Act, is one of two major pieces of legislation that will bring expansion to B.C.’s natural gas industry and to one of the safest and cleanest LNG export industries in the world.

B.C. is blessed by the fact that we are sitting on trillions and trillions of cubic feet of natural gas. That is enough to satisfy our domestic needs for generations to come, and it will allow us to still have plenty left over to benefit the province by selling it to developing economies in Asia, such as China and India.

Natural gas is the cleanest-burning of all fossil fuels, as we’ve heard, far surpassing coal and oil. By making natural gas available to countries such as India and China, we will contribute to lowering greenhouse gas emissions worldwide. And as those economies move away from using dirtier sources of energy, the whole world stands to be cleaner.

The natural gas industry is nothing new in British Columbia. It currently employs about 13,000 people in production of gas. But creating an entirely new export industry is not a simple task. It requires vision and an unwavering commitment to succeed, especially in the face of those critics who offer very little encouragement to thousands of British Columbians who will benefit from highly skilled and well-paying jobs in the natural gas sector. This is especially true for First Nations people and others living in remote areas of the province, who for the very first time will have access to rewarding jobs in their own communities.

Let’s talk about the environment. By introducing these key pieces of LNG legislation before the House, the government is delivering on a commitment made during the last election to promote the cleanest LNG industry on the planet. This is a fantastic goal. It is an opportunity for us to become a world leader in clean technology and boost our competitiveness beyond that of other LNG suppliers.

Bill 2 is designed to ensure that our facilities will address greenhouse gases to a higher standard than any other LNG facility in the world. B.C.’s world-leading benchmark will limit GHG emissions to 160,000 tonnes of CO₂ per million tonnes produced. That is the lowest emissions of any similar facility on the planet.

This legislation is far-ranging and makes room for technological advances in the future to be incorporated into the supply stream. Our government remains committed to reducing greenhouse gas emissions and, in fact, has been a global leader ever since introducing our climate action plan in 2008.

[1520]

Without a doubt, the government is choosing a more difficult path towards the reduction of greenhouse gases and growing our economy at the same time. We must, therefore, rely on innovation and cleaner technologies.

For example, of the 18 proposed export facilities in British Columbia, three intend to focus on a domestic market that provides fuel for the transportation and heavy equipment industry. With this new source of cleaner-burning fuel, British Columbia will become more energy self-sufficient and will be able to take an at-home advantage of our own natural resources. That means we can convert existing fleets of vehicles from heavy polluters to environmentally friendly parts of our economy.

Just last month B.C. Ferries announced that two of the largest vessels in the fleet are going to be running on natural gas by 2018. This announcement comes in addition to plans to build three smaller vessels that will also run on LNG. Fuel is B.C. Ferries’ largest expense, and natural gas is 50 percent cheaper than marine diesel. By gradually converting the fleet to run on natural gas, fare prices can be kept under control, rather than be ruled by volatile spikes in the price of gas on world markets.

Think of it. By reducing our reliance on petroleum and converting to a cleaner-burning fuel, LNG will be the source of energy for everything from public transportation buses to ships at sea. As we lead the way in LNG transportation technology, we will encourage our customers overseas to make similar conversions. Since our customers realize a 50 percent saving in the cost of fuel by converting to LNG, we will generate an even greater demand for our product.

The main point here is that we can reduce our greenhouse gas emissions simply by converting to LNG in the transportation sector.

But we have other opportunities to reduce greenhouse gas emissions as well. We can do it in the construction industry by using climate-friendly building materials. In fact, as has already been pointed out by one of my colleagues on this side of the House, almost one-quarter of LEED gold building projects registered in Canada are located right here in British Columbia.

Natural resources have always played a part for public infrastructure and social programs in British Columbia
[ Page 4891 ]
for everything from schools and hospitals to health care and education. There is not a road or bridge in British Columbia that was built without the benefit of our traditional forest and mining industries. They will continue to be mainstays of the provincial economy, but now LNG will also be a major player.

In the Lower Mainland we are benefiting from highway improvements such as the South Fraser Perimeter Road and the completion of the Port Mann Bridge. The government is focused on highway developments to further separate commuter traffic from commercial vehicle traffic.

In Abbotsford in particular we benefit by this because we want greater access to our airport, Abbotsford International Airport, which has the potential of overtaking Bellingham Airport in the area of destination flights. Why not give British Columbians the opportunity to spend their vacation dollars here in Canada and still enjoy the competitive rates offered outside the country?

But investments in highways and railways and overpasses require huge amounts of money. What better way to get there than to develop an environmentally friendly — and I emphasize “environmentally friendly” — and forward-looking industry, using a resource that lies right below our feet.

This government will deliver on LNG. There is no doubt in my mind that it will prove to be the single best thing, economically, that has ever happened to this province, and that will be true for generations to come. It will give us, most importantly, an opportunity to deliver on this government’s other obligations, such as health care, education, social services and great transportation — all of which we are committed to being world-class, number one in the world.

This is going to help us get there. Along the way we will be making a positive contribution to the environment on a global scale. Thank goodness we have leadership in this province that understands this completely.

[1525]

G. Holman: I am pleased to rise today and speak on behalf of my constituents about Bill 2. After the discussion today, I’d like to begin by trying to set the context, the frame of reference, for this debate, because it’s being characterized as the official opposition being against and the current government for, and that really is inaccurate. That’s not the debate here. What we’re talking about here is not the undoubted economic benefits of LNG, but the terms and conditions under which it’s developed.

The official opposition has been very clear that we do support the establishment, the development of an LNG industry in British Columbia, with four conditions: that they include an expressed guarantee of jobs and training opportunities for British Columbia; that they offer a fair return for our resources….

I would include in that a return to the communities most directly affected by the development of the industry, such as Prince Rupert, Terrace, Kitimat, who right now are experiencing…. In addition to their normal demands on overtaxed infrastructure that needs to be upgraded, they are already experiencing growth pains related to this industry that are not being addressed by this provincial government.

It’s very important that the communities directly affected by LNG get a fair share of the resources, as well, to deal with these kinds of impacts.

The third condition on our part is benefits for First Nations and recognition of First Nations’ constitutionally guaranteed rights. In the wake of the Tsilhqot’in decision, this is a very, very important condition on our part.

Finally, we support the development of an LNG industry as long as our air, land and water are adequately protected. This last condition includes living up to our climate change commitments. That’s what this debate is about, in particular this last point around living up to our climate change commitments.

This bill is supposed to address that. This bill is supposed to be all about that. Other speakers have pointed out, earlier in the day, that despite the name of the bill, which is the Greenhouse Gas Industrial Reporting and Control Act, the legislation, in fact, neither reports nor controls.

It’s an ironic title for this legislation, which is so lacking in terms of the reporting, in terms of the emissions being covered under the bill and the actual controls on them. As my colleague from Oak Bay–Gordon Head has pointed out, it’s an intensity approach as opposed to a cap. It doesn’t actually absolutely cap emissions.

Before I go on to talk further about whether this bill actually addresses the concerns around climate action and our legislated targets, I did want to talk a little bit about the threat. In the pre-election and during the February budget LNG was touted in terms of the trillions of dollars of economic activity, the prosperity fund, “Debt-free B.C.,” the elimination of the sales tax, on and on. As I indicated in my throne speech remarks, this language now has turned from the pot of gold at the end of the rainbow to what amounts to an economic threat.

We heard, actually, the member from Prince George repeat it earlier today, where he essentially said that without LNG we’re not going to be able to pay for our current level of services. That’s just simply not true.

[1530]

Current natural gas revenues in British Columbia…. Despite the millions of tonnes of production currently in British Columbia and the truly large potential for natural gas production in British Columbia, natural gas revenues only comprise about 1 percent of total B.C. revenue. So of about $44 billion in revenues per year, natural gas currently accounts for 1 percent.

Even if that were to go away…. I’m not advocating that. I’m just suggesting that natural gas right now is a very, very small portion of government revenues and, also,
[ Page 4892 ]
pointing out, particularly to this government, that over the past decade they have stripped literally billions of dollars in tax revenues from the provincial budget. All of a sudden, though, LNG becomes the saviour and the only way in which we can sustain our current level of services. It’s fearmongering at its worst.

I want to talk a little bit more about the actual legislation itself. As I said before, it’s not an absolute cap on emissions. One of my colleagues opposite used the phrase that it was an absolute cap on emissions per tonne, which is a roundabout way of saying that…. Really, it is an intensity kind of approach. Again, as my colleague from Oak Bay–Gordon Head has pointed out, this is the approach being taken by the federal government, which is yet to actually even impose intensity controls, never mind absolute caps. And it’s the approach taken in Alberta.

What it means is that while government can claim to have the cleanest LNG in the world — and there are some pretty serious caveats to that claim — it is theoretically possible to have the cleanest LNG in the world and still completely violate our climate action targets, targets that are legislated in this province, or at least used to be legislated. So it’s an intensity approach. It’s not an ultimate cap on emissions.

Some calculations done by the Pembina Institute indicate that if there were five plants, five out of the 18 that government suggests is a modest target that can be achieved…. And by gum, they’re going to achieve it. If those five plants went ahead as planned, the 0.16 benchmark would in itself allow 13 million tonnes per year of GHG emissions — as other colleagues have stated before, essentially a free pass.

So 13 million tonnes. Our current emissions are on the order of, I think, 58 million, 60 million tonnes. Already with that free pass, with the cleanest LNG in the world, that will increase emissions by 22 percent.

Then, of course, as other colleagues have mentioned, the biggest omission in this legislation is around the upstream emissions, which the Pembina Institute and others estimate to constitute about 70 percent of the emissions associated with these five new plants — 70 percent. Again, if those five plants were to go ahead and the production in B.C. were to increase in order to supply these plants, supply these facilities, the 70 percent of emissions that are actually excluded from the legislation would constitute a 74 percent increase in our current level of GHG emissions.

Together with the plants and the excluded upstream emissions, you’ve got pretty much a doubling of emissions. So the cleanest LNG in the world, if in fact that is true, will result in a doubling of emissions. Yet our climate action target, which is actually legislated in British Columbia — and full credit to the Liberal government for putting those targets in….

[1535]

The climate action target for 2020, which is only six years away, is a 33 percent reduction in emissions — versus those five plants, which suggest, imply, a doubling rather than a 33 percent reduction. The numbers don’t…. Well, unfortunately, the numbers do add up, and it’s just completely incompatible — the current legislation that’s in place, requiring a 33 percent reduction by 2020, and this legislation.

In fact, again, as has been pointed out before, a piece of legislation that would actually cap emissions for industrial facilities and sectors, the cap-and-trade act, is being repealed with this legislation. What’s being replaced is an absolute cap and replaced with this per-tonne-intensity kind of approach, which will allow a doubling of emissions. One can’t find the language, but certainly it’s completely contradictory with our climate action goals.

Now, another very serious problem with this legislation is the provision allowing the purchase of offsets or the contribution to a so-called technology fund. You know, for these kinds of measures, the devil truly is in the details, and this government certainly does not have a very good record when it comes to applying these kinds of measures.

Remember the Pacific Carbon Trust, which was just recently abolished by government. That Carbon Trust was in fact supposed to do exactly what this legislation is talking about here. It was supposed to facilitate offsets, facilitate investment in new technology that reduced greenhouse gas emissions.

Well, that entity, that organization, has been scrapped after a scathing report by the Auditor General of this province. In its review they looked at two particular transactions by the Pacific Carbon Trust — one involving Encana around GHG-capture technology that it was investing in and another one that purchased the protection of a large tract of land called Darkwoods by, I believe, the Nature Conservancy of Canada.

In both those cases the Auditor General found that those investments would have occurred anyway. What the Pacific Carbon Trust did in those cases was to transfer millions of dollars to two projects that would have occurred anyway, would have happened anyway. So this is the concern with reliance, and the excessive reliance in this legislation, on offsets and purchase of technology rather than actually reducing emissions at the facilities themselves.

The record has not been good, and it has certainly not been good by this particular government. It has already tried and failed in establishing that kind of organization.

It’s been also mentioned by previous speakers that there is an excessive reliance or reference in the bill to a whole number of regulations that will affect the offsetting measures, that will affect the contributions to the technology fund — a whole number of regulations that are to be declared later. Twenty-five percent of the bill is regulations that currently aren’t in place, so that certainly sends alarm bells, especially when there’s such a
[ Page 4893 ]
reliance on offsetting — you know, carbon-credit kinds of mechanisms — in this kind of legislation. There’s so much that is unknown.

It’s been pointed out, as well, that contributions to the technology fund would be at a prescribed rate of $25 per tonne. But actually, on the world market for carbon credits you can purchase those credits for much lower dollars than that.

[1540]

Given that — and there’s no indication whatsoever that those kinds of purchases would not occur — why would LNG producers contribute to a technology fund at $25 a tonne when they can purchase offsets for much lower value? This is the kind of devil in the detail that really raises alarms here.

Again, it’s not that in theory these things are by definition bad. It’s just that the history of this government in particular, applying these kinds of measures, has been such a failure in the past. Such an excessive reliance in this legislation on them really does create cause for concern.

The argument about displacing coal use in China and other countries has come up. We need to be clear here that what this debate is about is British Columbia’s legislative targets, not the world market for offset, not the world demand for coal.

What’s at issue here is British Columbia’s own emissions, which are required by legislation to be reduced by 33 percent by 2020. Arguments around reducing coal use in China really have nothing to do with this legislation, nothing to do with this debate. It’s a red herring. In fact, any LNG producer could make that claim. British Columbia could have no plants go forward, and China will still be looking for natural gas imports. In fact, it’s already made arrangements with Russia, which is going to be building a pipeline into China.

The claim by British Columbia that somehow our LNG exports are going to be uniquely offsetting China’s use of coal is nonsense. First of all, it has nothing to do with our obligations, and secondly, any LNG supplier could make that claim. So it really is irrelevant to this debate.

With regard to the upstream emissions, what’s problematic is that right now even the carbon tax…. Again, I give credit to this government for bringing that carbon tax in. But right now that carbon tax only applies to certain sectors. It omits sectors and, in particular, it omits the upstream components of the natural gas industry. Of particular concern there are the methane emissions associated with fracking. Not even the carbon tax applies to those upstream activities. So it’s not at all clear how those impacts, how those GHG emissions are going to be in any way mitigated.

I just wanted to read a couple of comments from, let’s say, an expert and from some of our better-known pundits, about the legislation.

Marc Lee, who’s an economist with the Canadian Centre for Policy Alternatives, referred to the offsets as one small step for GHG emissions and a giant step for greenwashing. That was Mr. Lee’s comment.

He described how the offset process would work. Not only whether or not they’d be effective is pretty murky; but government is actually going to be subsidizing these multi-billion-dollar enterprises that are making billions of dollars a year in revenues. This provincial government is actually going to be subsidizing them to reduce their greenhouse emissions rather than just requiring it by regulation.

This is what Mr. Lee has to say. “Government will subsidize the GHG penalty” — where this comes into play is between the 0.23 and the 0.16 per tonne of emissions — “as much as 100 percent of it for plants with emissions just over the 0.16 standard, say, 0.17 tonnes” — so there’ll be almost a 100 percent subsidy for these companies that generate billions of dollars in revenues and are going to be generating millions of tonnes in emissions — “dropping, on a sliding scale, to 50 percent of the penalty for plants at 0.23. Above that, no subsidy.”

[1545]

What does this mean in terms of numbers? At ten million tonnes per year, an LNG plant at 0.23 intensity would have to contribute $17.5 million to the tech fund, but half of that would be paid by government. By comparison, the profits to the company for export to Asia, just the profits, would be just be shy of $2 billion. At a moderate price of $14 million cubic feet and a landed cost of $10, the post-subsidy hit to the company would be less than one-half of 1 percent of total profits. At 0.19 intensity the subsidy ramps up, and the hit to profits would be 1/10 of 1 percent.

That gives you an idea of the degree to which it appears this government is so desperate to get this off the ground that we’re subsidizing an industry making billions of dollars of profits on these facilities — and we’re still subsidizing them. It makes no sense whatsoever.

Just another comment about the targets, and this is from the inimitable Mr. Palmer writing about the Environment Minister’s comments insisting that the province will still meet its targets — although if you look at the arithmetic, it just boggles the mind about how that’s going to happen, particularly given the gaps in this bill. Mr. Palmer says: “Her claims on that score were the least persuasive part of the briefing.” He went on to talk about exactly what I did earlier. You look at the arithmetic, you look at the greenhouse gas emissions that will be allowed in terms of a free pass and allowed if the offsets don’t work, and we’re going to be doubling our emissions. Mr. Palmer was pointing that out.

He also made a point about the regulations — about which we know nothing, essentially, with 25 percent of the bill around regulations yet to be determined. Mr. Palmer says: “Even by the lax standards established by the B.C. Liberals over the years, it may be some sort of record to have, in effect, consigned 25 percent of the bill to provisions to be named later.”
[ Page 4894 ]

Clean Energy Canada had a comment about the claim about the cleanest energy in the world. They state that “on its own the bill won’t result in the cleanest LNG in the world. LNG production releases carbon production all the way down the chain of production, from wellhead to waterline. Today’s legislation only addresses the last link in that chain.” It also allows companies to buy credits rather than actually build cleaner terminals. They say: “Even if B.C. does ensure that this industry is built to world-leading standards” — let’s take that as a given; let’s take government at their word — “it would still sharply increase the province’s greenhouse gas emissions.”

Mr. Speaker, I understand that there is other business to be considered by the House, so I would move that we adjourn debate on Bill 2 for the moment.

G. Holman moved adjournment of debate.

A. Weaver: I stand on a point of order.

Deputy Speaker: Proceed.

Point of Order

A. Weaver: I’m standing to seek clarity from you with respect to decisions regarding the banking of time subsequent to proposing an amendment by a member of this House. There has been inconsistent application of the rulings within this Legislature over the years, and I think the Legislature and our members would benefit from some clarity from the Speaker as to whether or not, once the amendment is introduced, the person introducing the amendment may stand and speak to the original motion after the amendment has been passed or defeated.

[1550]

Deputy Speaker: Thank you, Member, for your point of order. I’ll take it under advisement.

Debate Continued

Deputy Speaker: The question is the adjournment of debate.

Motion approved.

Hon. D. McRae: I call committee stage for Bill 3, intituled Canadian Pacific Railway (Stone and Timber) Settlement Act.

Committee of the Whole House

BILL 3 — CANADIAN PACIFIC RAILWAY
(STONE AND TIMBER) SETTLEMENT ACT

The House in Committee of the Whole on Bill 3; D. Horne in the chair.

The committee met at 3:51 p.m.

On section 1.

B. Routley: In reviewing Bill 3, it’s clear that this is connected to litigation that was started by the CPR and the government. I would just ask, for greater clarity, if the minister could give us a brief overview of how this got started.

Unfortunately, I wasn’t able to be there for the briefing the other day, so while I don’t expect you to do a half-hour- or an hour-long briefing, it would be good for the benefit of the public and, certainly, for this House to have a better understanding of how this came about.

How did the government get approached? What is the purpose of this bill?

Hon. S. Thomson: Just a little bit of history. We’ve talked about that in the introduction of the bill. This is as a result of a very long, historic situation where there have been reservations of timber and stone on properties that CP Rail became the owner of when they took over the assets of those historical railways where the lands were originally granted.

The way it came forward, I think, is that this was about early 2000. People were aware of this. People have known about this. Discussions started with the CPR to try to resolve and create certainty around the uncertainty that was in place as a result of those reservations. That process went on over a period of time, ultimately without resolution. Then CP launched legal action, a legal claim against the province, to clarify their interests, to confirm their interests in those reservations.

[1555]

That created further uncertainty, and it was viewed that we needed to find a way to settle this without ultimately going through the full court process, which would have been expensive, time consuming. It would have had potential additional liabilities to the province as a result of activities, decisions and actions that had been taken on those properties over time.

A process was initiated to negotiate a settlement. That was reached in agreement with CP Rail, plus some additional considerations as part of that settlement.

What the legislation does is confirm that settlement, validate retroactively past actions that were taken on that to remove any of the liability and risk, extinguish those reservations on the properties and, ultimately, bring that certainty to both Crown and private land owners.

B. Routley: Thank you for that. I guess that also leads to the question of rights and obligations.

I’m not a lawyer, but it’s pretty standard that where there are rights, there ought to be some obligations as well. If the railway had inherited certain rights from historic railways and not applied them or asserted them for
[ Page 4895 ]
a long period of time…. I just wonder: had the government received any legal advice on a question like that? I mean, we’re talking a long, long period of time. Or were there, more recent than the last 50 or 100 years, actions taken — other than what I’ve heard anecdotally, about some people paying for rights and some people not paying for rights? All of that part is very confusing.

If you could somehow comment on: how could the government find itself in a position of owing somebody $19 million for rights that they hadn’t asserted along the way?

Hon. S. Thomson: The member opposite indicated that he’s not a lawyer; neither am I. I just want to make that comment as I work through to respond with the complexity of all this.

The basic principle, and I think the basic principle in law, is that, fundamentally, private property rights don’t go away, even though they may not have been asserted or exercised over a certain period of time.

When the awareness came around this, it is something that we looked at. We looked at whether or not there could be an argument around the fact that it hadn’t been asserted for that long period of time and whether, from a legal perspective, that was an argument that could be advanced. The advice was no, it wasn’t. The fundamental principle of those rights remaining over that private property, because they were there, would remain, and we would be facing that principle.

[1600]

The legal advice was to work towards negotiating the resolution of the fact that those reservations were still in place.

V. Huntington: Just in response to the minister’s comment. In its response to the claim, the province stated that not all conveyances by CPR included reservations and that the railway timber reservations didn’t include timber that wasn’t commercially viable at that time and that those species passed to the purchasers of the land. B.C. also said that the railways only had the right to timber needed for railway purposes.

Well, if that’s part of the claim, perhaps the minister could discuss with us what parts of CP’s claim that B.C. is then acceding to. B.C.’s claim itself was pretty thorough, I thought, and yet you’re suggesting that your advice was that parts of that claim didn’t make legal sense.

Hon. S. Thomson: The member opposite is correct in terms of the legal arguments that were being advanced or put forward in the process and would have been the arguments that would have carried through if it had gone through to the court process. In considering — as we looked at the options and things and considered whether to continue that process — whether to settle and look at, on balance, what was gained by settling this in a settlement agreement as opposed to a court process and the potential risks and potential cost to the province coming out of a court process, we settled.

We agreed. On balance, the view was that the legal argument was probably stronger — that the timber that was on the land at the time the reservations were made and provided to the historic railways and then taken over by CP — and would have prevailed. It is not an insignificant amount of timber that was in that amount on all of those properties.

On balance, it was one of the considerations that was made in working through to a settlement process, as opposed to going to litigation. If we couldn’t have settled and we ended up in litigation, those would have been the arguments we made. But whether we would have been as successful or not — the court processes would have determined that.

[1605]

Based on everything else that we gained out of the process, we felt settlement was the most prudent option here for what was gained by settling, rather than going through that costly court process with an outcome that was not fully known.

V. Huntington: Can the minister tell the House what estimates the province made if they were to have lost the case had they proceeded? How does the $19 million compensation package measure against what the cost of a settlement would have been if it had been made by the courts?

Hon. S. Thomson: CP’s claim in the process was around $40 million, or in that range, in the process. We would have also faced, if it had gone the full court process, a number of millions of dollars of court costs. If we had not been successful in that process, we would likely have also faced reimbursement or coverage of some of their costs in the process. So somewhere in the range of $40 million or more was the claim.

Again, based on the assessment of the case and the legal arguments and avoiding that potential liability to the province, avoiding all of those costs, the view was that settlement was a much preferable option at less cost to the province. That was the result of those settlement discussions.

L. Krog: I’ve had a chance to review the notice of claim and the response to the civil claim filed, and the proceeding which is referenced in the definition section is that “‘current action’ means Action No. S134003 in the Vancouver Registry of the Supreme Court.”

The minister mentioned in his opening explanation that discussions around this matter occurred in the early 2000s. I just want to confirm. CP raised those issues in the early 2000s. Can the minister be more specific as to when the claim was raised?
[ Page 4896 ]

What I’m going to be driving at, just so there are no surprises, is that I wonder about the issue of limitation periods that might apply in these circumstances and what the view of the ministry was with respect to those limitation periods if this claim was in fact raised in the early 2000s.

I note reference to an agreement to waive all defences based on the passage of time in the notice of claim that was referred to in paragraph 23. I’m just wondering if the minister can explain the relationship there. In other words, when they raised this, was there some serious issue that they were out of time? Does the limitation period apply in these circumstances? And if so, what consideration was given to that?

[1610]

Hon. S. Thomson: My advice is that the limitation period, the limitation provisions, did not apply here. These were reservations that were on both private and Crown land that didn’t expire, hadn’t been extinguished, and that they, through the process, owned those reservations, both for the trees and stone.

There was an intensive period of engagement with them in 2006 when we applied to have all of the action or all of the process dismissed. That was put into abeyance. Without-prejudice discussions were launched in order to, as I pointed out, reach the settlement.

When that did not result in success, then CP launched their legal action against us. Then, following from that, we could have gone through the process of the legal process. But on balance, we determined that looking to a negotiated settlement on this was the best for all parties — including the province but in particular both Crown and the particular private land owners who still had those unextinguished reservations over their properties.

L. Krog: Well, the reason I raised the issue of the question of any limitation period that might apply is that, specifically in the notice of civil claim, in paragraph 23 on page 6 it says: “On December 22, 2009, CPR and HMTQ” — meaning Her Majesty the Queen — “entered into a written agreement with respect to the tolling of limitation periods regarding the claims against HMTQ in this notice of civil claim.” An express term of this was that Her Majesty the Queen, HMTQ, “agreed to waive all defences or arguments at law or in equity based on the passage of time after December 31, 2006.”

The claim itself was not actually filed in B.C. Supreme Court until May 30, 2013. So again to the minister, that allegation in the plaintiff’s claim itself in paragraph 23 would seem to me indicate that there was some issue around a limitation.

I’m just curious if the minister can explain what he said in his previous answer in contrast to the fact the statement of claim is not filed until May 2013. Obviously, in 2009 there was a written agreement alleged — and I assume that this isn’t inaccurate — that waived all defences based on the passage of time after December 31, 2006. I’m just curious to have an explanation of what that means, other than the plain reading of it that I’m taking.

[1615]

Hon. S. Thomson: Again, we’re trying to fully work through all the legal side of this. When we wanted to move this…. It initiated from one sub-lot. That was in 2006, where the process started.

The point the member opposite raised around waiving the limitations was done in order to facilitate negotiations, good faith negotiations, whether limitations existed or not. As I made the point, I think, in the earlier comments around private property rights, the legal argument that probably limitations didn’t exist…. But in moving to the process of those without-prejudice discussions, providing the indication around the waiving of the limitations — if they existed, and it’s not clear that they did — was in order to facilitate that negotiated process so that we wouldn’t have been accused of trying to drag the process out to get to some limitation period that might be applied, and then we would start arguing limitations or something like that. That’s my understanding.

L. Krog: Just so I’m clear in my understanding of this. Then the issue of limitation periods was a live item of discussion that, clearly and obviously, was and must have been raised by either the Crown or the plaintiffs during the course of negotiations. It had sufficient substance and was of sufficient concern that, in fact, the plaintiffs and the Crown entered into a written agreement which would have the effect of saying that anything after December 31, 2006, couldn’t be added to the period of time during which the limitation period existed, but that certainly it was a live issue as to whether or not limitation periods existed with respect to this claim at the time, in 2009, when this was entered into.

I’m just curious. The time frame here is three years, and I’m just wondering if the minister can explain what section of the Limitation Act…. Or on what basis was that three-year period the subject of the agreement?

[1620]

The agreement is December 22, 2009. The waiver of defences — based on limitation, etc. — is after December 31, 2006. You’ve been in negotiations since 2000. So was it or was it not a live item that, in fact, the province had raised during the course of negotiations?

If the province gave up the right to use a defence on the basis they wanted to keep negotiating, I must say that my immediate reaction would be — as someone who has had a little bit of experience at the bar: why didn’t the plaintiff, if they were so cocksure about their case, file their claim with an agreement with Her Majesty the Queen that they then hold it in abeyance while they entered into negotiations? Then it wouldn’t be a requirement that the
[ Page 4897 ]
province, Her Majesty the Queen, file a response to civil claim at that time.

It seems to me that that would be a very logical approach to take, as opposed to entering into an agreement that says we get to keep talking, but in the meantime, we’re going to waive any rights to raise the issue of a defence of a limitation period.

I’m just wondering if the minister can respond to what I’ve had to say and explain to me why it was done this way and why not the way I’ve suggested, which is more common in litigation. If you think you’ve got a limitation period problem, the first thing good counsel does…. With great respect, I believe it is the firm of — just give me a minute — Fasken Martineau DuMoulin LLP. Not exactly a small-town law firm. It’s not a solo practitioner — a law firm of that prestige, power and ability.

I’m curious to know why that method, if you will, that I’ve suggested wasn’t employed, as opposed to this. It allowed this thing, arguably, to drag on longer than it could have, as opposed to letting the litigation get started and then negotiating.

[1625]

Hon. S. Thomson: As the member opposite pointed out, legal advice — experienced legal advice — along with the Ministry of Justice and legal advice involved in that process…. It was viewed as the most effective way to move good-faith negotiations forward.

We could have held that — forced filing, forced defence, and then moved it into abeyance or reached agreement to move it into abeyance and enter into those negotiations. The decision, or the strategy chosen, was to facilitate those negotiations by waiving that process and then moving it into abeyance right away so that we could do that. That was the advice that was provided and taken.

L. Krog: The lands that we’re dealing with and as set out in the statement of claim…. I’m going to assume that the statement of claim is, relatively speaking, accurate for the purpose of discussion today. It’s referenced in the bill itself in the definition section under “current action.” All of this relates to 5.2 million acres of land that were granted between 1892 and 1907, covering a substantial portion of southeastern British Columbia.

Now, my understanding is that, again, 830,000 acres were transferred to private purchasers under transfers that were registered in the applicable land title office. That we have, in certain circumstances, not all…. The three railways involved — being the Columbia and Western Railway Co., the British Columbia Southern Railway Co. and the Columbia and Kootenay Railway and Navigation Co. — reserved to themselves the title to resources on the lands, and in particular, for approximately 145,000 acres, trees and stone reservations excepted and reserved unto themselves all wood, timber and trees and all valuable or marketable stone — that’s the tree reservation and stone reservation — for approximately 380,000 hectares, but not the tree reservations, except in reserve for stone but not the tree reservations. Collectively, we’re talking about 525,000 acres of land.

It goes on to allege and confirm…. I want to confirm with this minister how much land we’re actually dealing with now. Could the minister tell the House how much land is involved that has reverted back to Her Majesty the Queen — but, according to the litigation, not the timber and stone rights — and how much land is now held privately by various individuals or corporations — again, where it’s alleged that the timber and stone rights are still the property of the CPR, being the successor in title to the three railways I’ve mentioned?

[1630]

Hon. S. Thomson: The land involved in the settlement, on which there were timber and stone reservations, was 145,000 hectares of Crown land and 68,000 hectares of private land. That’s the land that’s involved in the settlement agreement. Over time there have been reversions and reconveyances back. It was part of some 1920 legislation. There were not reservations of stone and timber on those properties. The subject of the settlement, the subject of the legislation, is those lands.

In terms of going back and searching all of the conveyances, all of the land title records, all of the reversions, I would not have those specific numbers. It’s a very complex undertaking to do that. So what we’re dealing with here is those specific amounts of property that are involved in the settlement agreement and, subsequently, the legislation.

B. Routley: I would like to better understand how this is possible. I mean, in the province of British Columbia we’ve got all of these complex processes, whether it’s under the Land Title Act or certain legislation. A lot of it dates back to, as we know, the 1800s, so this gives pause. Today we’re now going to cough up $19 million — the good people of British Columbia. Somebody, obviously, dropped the ball.

The minister is now in a position to at least offer up some observations whether these are historical deficiencies. Was someone not doing their job in registering land?

Obviously, when you convey land from one party to the next, all of those kinds of rights or privileges that are on your land should have been identified for those individual landowners. I’m assuming that if we’re paying money, folks didn’t know. On the other hand, it’s strange that some people are telling us that they did pay money for the timber and mineral rights.

I’m not clear. Was this kind of a half in, half out? Like, did all of the private land owners know that they had the timber and mineral rights claimed by the railway? Yes or no. And I guess you could answer at the same time: did the Crown know? Obviously, somebody should have had
[ Page 4898 ]
the responsibility, and maybe you can give us an opinion on who that was that dropped the ball that now costs the good people of B.C. $19 million.

[1635]

[R. Chouhan in the chair.]

Hon. S. Thomson: As the members opposite know, much of this process was in the early 1900s. The land title system was evolving at that time. In some cases these didn’t show up. In some cases they were registered as a charge, I think, at the time. I wasn’t there at the time. But I think the….

Interjection.

Hon. S. Thomson: Somebody said: “The member opposite was.”

Interjection.

Hon. S. Thomson: Yeah, right. Exactly.

But this was a fairly novel thing at the time, the way that I understand it — to convey the properties but to retain a reservation of timber and stone at the time. In all likelihood, there was probably some responsibility on the part of the conveyors, on the part of the railways, on the part of the people who were receiving it at the time.

The one thing that is clear, though, is that you can go back to the original grants — where, clearly, the reservations were there. They exist. They have continued, to this day, to be a covenant or a charge against those properties — and in CP taking over from those historic railways, from a perspective, continue to have those reservations. It has created uncertainty for the Crown. It has created uncertainty for the private land owners.

The view has been, over the last number of years, that we needed to find a process to resolve this, to provide certainty for all and some settlement in the end of this with the settlement agreement. The process here, as opposed to a litigation process with an uncertain outcome in terms of costs and outcome to the province, was viewed as the most efficient way to achieve the objective of providing that certainty.

In the assessment, the value that was in the settlement was viewed as a defensible amount to settle this and provide that certainty, when you compare that against the potential costs and outcome of a prolonged legal process to achieve the outcome of the settlement and providing that certainty. Ultimately, in order to extinguish those reservations, the settlement option and negotiations which we ultimately agreed to were seen as the best outcome.

B. Routley: Well, thank you for that explanation. The one thing that I’m at a loss to understand is that while certainly there is some complexity, it sounds like it was in some cases readily available to a land purchaser to see that there were timber rights, and under the mineral rights…. In some cases people have paid for it.

[1640]

It seems to me that the government has also in this legislation kind of picked winners and losers in that the people who are the winners are the people that are going to benefit as a result of the government seeing this as a very, very expensive problem, potentially $40 million or more. To settle that matter, there’s $19 million being offered up, or has been offered — paid, I gather. But what about the people who are the losers, that have paid good money and now are looking at this and saying: “Well, wait a minute. If I had just ignored the mineral rights….”?

The people who have been, as one of the folks that e-mailed put it, “stealing logs or stealing timber and potentially stealing underground or mineral rights” get the benefit. They win the lottery, with this $19 million payout, and the people who were trying to follow the law of the day and actually paid out good money are being somehow punished. It’s pretty clear that this legislation even has a section in there to make sure that their rights are extinguished to even go to court on this matter.

Do I have that correct? Is there some rationale behind why there should be winners and losers? Is this in the public interest of all British Columbians for the government to be picking winners and losers in this process?

Hon. S. Thomson: This was not a process about picking winners or losers. The private land owners who may have exercised a process to purchase the reservation in some way to quiet the title so that they could access the timber resource on that property or the stone resource — probably much more likely the timber resource — did so to be able to exercise the benefit at that time, knowing the regulatory and legal position at that time. Based on the overall benefit of this, in terms of extinguishing those rights on a significant area of both Crown and private lands, this settlement was viewed as the best way to achieve it.

The other thing that was achieved in this, which is important to recognize too, is that for those private owners who had taken the step to have that reservation extinguished at that point, this legislation also ensures that there would be no action against those private land owners who may have exercised or utilized some of that timber that was under the reservation before they purchased the reservation.

[1645]

Now, the question is: would CP have gone after them? Would they have likely done it after they’d purchased it? Probably not. It’s not fully likely, given that they did pay a value to have those rights extinguished. But the legislation also ensures that that’s not the case.

In addition to the settlement, we also ensured that
[ Page 4899 ]
there was no opportunity for any past action against any private owners where those reservations existed, if they had taken any steps, prior to any purchase of those reservations, of having utilized any of that private timber.

The trick in quite a bit of this is the fact that when you need to look at what the definition of the private timber is, it’s the timber that was in place at the time of the reservation. In a lot of these private properties, you have this mix of timber that would have been under the reservation and timber that would be private timber that’s not subject to the reservation.

It was always the challenge around which was private timber and which was timber that had a reservation on it, depending on whether they had a fully uniform stand that was in place at the time or whether there’d been fire activity that had come through and regrowth. That wouldn’t have been affected by the….

It got very, very complicated. Some landowners took the opportunity to try to quiet the title so that they could take benefit of the timber on their property without that complication.

I think, on balance, it wasn’t a process about picking winners or losers. It was a process about a settlement to achieve a level and a great certainty to settle a longstanding historical situation for the Crown and private land owners in the province.

B. Routley: Okay. What percentage of the Crown land was reallocated to other stakeholders? Were these forest companies, primarily, that did harvest? Do you have any idea of what amount of the land was actually mined in any way, or was that basically zero?

I guess the issue…. If we had a liability or the province saw themselves as having a liability, potentially, of $40 million and so paid out $19 million, then certainly there must have been some reallocation or some decisions by the provincial government to do something with that Crown land.

Was the majority of that Crown land reallocated in various licences, and what would they have been? Or was it sold?

Hon. S. Thomson: Yes, I’m advised that over all of that historical time period the Crown did allocate and did provide opportunities to companies and to small logging operators and things.

[1650]

The opportunity was to harvest what the Crown thought was Crown land, Crown timber, with the reservations that were in place but are now being extinguished.

Some of that timber — I’m advised that it’s not an insignificant amount. That was part of CP’s claim. And they did name certain companies in their claim for damages and would have gone after those companies for damages. Ultimately, those companies probably would have looked to the Crown to cover off those damages because of the decisions that the Crown made. So that was part of the rationale for the settlement.

Because of the point that we raised earlier about not all of these reservations being on title, not all known, not the charges there, the opportunities were provided for timber. Then, again, it gets down to that point of: which of that was Crown, because it was not timber that was actually part of the initial reservation, and which of it was private?

Again, very complicated and almost impossible to determine exact amounts. But I’m advised that it’s not insignificant, and that was part of the rationale for the settlement process.

L. Krog: To review this a little bit, we have 145,000 hectares of Crown land on which CP has alleged that the timber and stone rights had been granted to their predecessors, these three railway companies. And we have one owner, Her Majesty the Queen. We then have 68,000 hectares that are held by private land owners. Is that the correct number?

I appreciate the nodding of the two able people who are assisting the minister here today. I don’t recall him introducing them, but I know that he will out of courtesy, because they certainly deserve credit for being here to assist the members of the assembly in what is a fairly complex question.

So we have 68,000 hectares. My understanding from the briefing — and I couldn’t attend all of it — is that that may involve some 10,000 separate parcels and/or separate property owners. Is that correct?

Hon. S. Thomson: Yes, I’m advised that on private land that number of 10,000 titles is correct.

L. Krog: So the point is this. For the CPR, notwithstanding its significant resources, to have engaged in litigation that would be effective…. After all, this litigation notes, by way of representative John Does, that it’s John Does one to 100 and ABC contractors one to 100.

To have engaged in realistic litigation that potentially might have been successful, unless the court somehow certified it as some kind of a class action — I’m no expert — or whatever, could potentially have meant they would have had to have made roughly 10,000 separate claims to go after these individual property owners, whether they be small corporations, large corporations or individuals.

Is that not, in fact, the course that CP would have had to pursue if they had gone after those private property owners in a serious way, those very private property owners who, my friend from Cowichan Valley has pointed out, will now receive the benefit of an absolutely clear title?

In other words, they get not only the surface rights, the normal fee simple, as I understand it, but their timber and stone rights. Wouldn’t it, in fact, have meant, then, that CP would have had to pursue them in 10,000 claims? Am I wrong?

[1655]

Hon. S. Thomson: I think that, essentially, the member opposite is correct. But it’s important to recognize that the claim that was filed was against the province and with respect to Crown lands. The numbers we talked about were the suit against the province.

What we did in the process of saying that we’re prepared to look at settlement instead of litigation and things like that…. “We’re prepared to do that if you will, in that process, remove and extinguish all the reservations on all of those private properties,” to be able to provide the comfort to those numbers of landowners — that they would not be subject to that.

Whether CP would have launched that many and all of those, we don’t know. But what we wanted to do was to make sure that in settling this, we provided that quiet title for all of those private land owners.

L. Krog: I much appreciate the government’s generosity to the good people of the southeastern corner of British Columbia, assuming they’re all resident property owners, in resolving this claim, on the face of it, through this legislation by absolving them of the necessity to either defend an action that CP could have brought against them or, alternatively, seeking a declaration, as they were entitled to do of a court, that in fact these rights didn’t exist anymore and that they held the timber and stone rights themselves.

I guess what I’m getting at is that it would have been an administrative, and incredibly expensive, nightmare for CP to have pursued this. The likelihood of it happening, I would suggest with great respect, was not strong. The fact is that what it looks like to me is that CP went after the one person, so to speak, Her Majesty the Queen, who has deep pockets and an ability to pay. And the amount that Her Majesty settled on is no small sum. It’s $19 million.

Yet we have been given information from affected private land owners who had already purchased their stone and timber rights. One woman advises that she herself was part of a purchase of the timber and stone rights — the surface reservation, if you will — on 379 acres of Crown land for $1 million dollars. Another landowner in the Kootenay district apparently paid CP $250,000 to have the stone and timber reservation removed from her 160-acre parcel.

I’m going to assume that this must have involved some real estate transaction gone wrong or it was poor real estate advice. On a 3.1-acre lot in the Kootenay land district a real estate agent bought the reservation from CPR for $10,000, because the purchaser wanted it removed from the property. My guess is that it’s more likely that there was a conveyance or a real estate deal along the way, and suddenly someone discovered that they weren’t going to get the whole thing.

My point is this. Given that these landowners, private land owners — the roughly 10,000, whoever and wherever they may be — weren’t likely to be subject to any court action, why is the province, as part of this arrangement, not requiring that the rights, in fact, and the right to make the claim with respect to the stone and timber rights, be transferred to the province as opposed to being released or given, if you will, to those 10,000 landowners?

[1700]

Hon. S. Thomson: During the process the province did consider assuming the ownership of the timber but, in analyzing all of that, reached the conclusion that due to the nature of the reservations, the effect that selling those reservations could have for the landowners…. It’s scattered over thousands of parcels. Describing the reserved timber and stone on the individual parcels would have been very expensive, as detailed inventories are not available.

Determining a fair market value for the timber and stone would have been challenging, assuming that it could be described accurately, and that’s a significant challenge in itself. We would have had to develop special administrative systems in order to manage the reserved timber and stone on the private land. It may not have warranted the effort to bring it to market.

Assuming we could have determined a market value, the only way to realize on that would be to offer to sell it to the landowner. If the landowner didn’t want to buy it, then presumably either the Crown or the province would maintain ownership of it.

It would have been potentially put up for bid, because there was something that you could offer which would then…. The owner would then face somebody else who purchased that reservation or that right to be able to come onto the property to harvest the timber — an intrusive process. It would have met with opposition. We could have found ourselves in other legal challenges regarding the ownership and the valuation.

So for these reasons, the province felt that the extinguishment of those was the best process.

L. Krog: I throw this figure out for the minister’s consideration. If we had 10,000 private property owners, and indeed, if you charged them only $2,000 to get the timber and stone rights as part of their title, that would generate, unless my math is terribly incorrect, $20 million.

That’s a million dollars more than what we’re paying CP to relieve the province of its potential liability in this and purchase, as a benefit, the stone and timber rights for the benefit of 10,000 private property owners — as opposed to, as my friend from the Cowichan Valley pointed out, those property owners who have already gone ahead and paid their money.

In other words, all of the taxpayers who will get no benefit from this — I don’t like to use the term “taxpayers”; let me say all the citizens of British Columbia who will get no benefit from this — are in fact paying $19 million to benefit a pool of very, I’m sure, worthy and de-
[ Page 4901 ]
serving citizens of the southeast corner of the province — to the tune of $19 million, without them being asked to contribute one single, solitary sou to this.

Where I’m going with it is: would it have been that difficult, either on a political level or a practical or a legal level — or is there any inability to do this — to have simply paid the $19 million, taken the transfer of the stone and timber rights back into the province’s hands, and then registered on the title of all of these 10,000 lots the stone and timber reservation in favour of Her Majesty the Queen?

[1705]

Hon. S. Thomson: While the member opposite’s suggestion on the surface looks like it would….

Interjection.

Hon. S. Thomson: Or under the surface.

On the surface it looks like it had some merit. But I think you need to understand that there is the administrative process of doing all of this, trying to find all of those titles, trying to get it all registered, trying to determine the differentiating values between the different property owners, because there would be different values of timber on different properties — all of which would have just been an administrative nightmare to be able to do that. So that option was not considered.

The other challenge we had is that many of these people bought the properties assuming that they already had those. They paid values assuming that they owned the timber. They didn’t know the reservation was in place on that property.

To come back to those owners and say now, “You paid for something that you thought was clear. Now it’s not clear. You’re now going to have to pay something more to get something for what you already thought you paid for,” and they would say, “To heck with you. We’re not going to do that. It was your processes or whatever that caused this situation, so I shouldn’t have to pay for something I think I’ve already paid for,” we would have gotten into a real quagmire, in our view, in doing that.

If they didn’t, then they would still have this reservation on title if they didn’t quiet it through us providing that opportunity. It would have affected future conveyancing. It would have been seen as something the province had ownership of and that we maybe, if there was significant timber value there, should capitalize on in some way, having that value — which means you would have put it out for bid and sold to it somebody else if they didn’t do that.

It would have created that kind of situation. Then people would not have been able…. Then they’d have to get access to the property. All of those kinds of things. It was just viewed as an administrative quagmire in order to do that. So on balance the decision was that we would, as part of the settlement agreement, quiet and extinguish the reservations on those private properties as part of the settlement of getting the claim against the province on the Crown lands settled.

L. Krog: I’m not unsympathetic to the concept of the innocent purchaser for value, who bought their land in good faith, whose lawyers did searches on title, determined that there was nothing reserved to anyone — although I understand from the briefing that there were, in fact, some lawyers and notaries and realtors in various communities in the Interior who, in fact, understood that this was indeed a live legal issue. Although I’m very sympathetic to it, one has to consider this from the point of view of the citizens of British Columbia.

These three railways were incorporated pursuant to acts of the Legislature of British Columbia and, by the acts of the Parliament of Canada between 1890 and 1898, were declared to be for the general advantage of Canada to be operated pursuant to the laws, etc.

[1710]

Then the province over a period of forked over 5.2 million acres of land — fee simple title, no reservations to Her Majesty. Fee simple title, 5.2 million acres of land.

I guess my question to the minister is: in light of the fact that we’re now going to benefit another subset of the province — in that case, it was railway companies; now it’s the private land owners — what benefit did the people of British Columbia receive?

By that I mean direct benefit, not the indirect benefit, in theory, of having a railway built. But what direct benefit did the people of British Columbia receive for these various grants totalling 5.2 million acres?

Hon. S. Thomson: I can’t speak for the decisions of legislators at that time. The arrangements were to…. That was the deal — to provide subsidies to railways to get the railways built, to open up the areas of the province. That was viewed as the benefit at the time.

When you look back through all of the history on this, and as the member opposite pointed out in his comments during second reading, some fascinating reading and some interesting history of all of that. But that was the decision at the time.

What we’re dealing with here with this settlement is the results of all of that, over all of that period of time. The situation that we find ourselves in with the reservations in place…. A legal challenge, on balance, could have provided significant costs to the province in terms of settling a legal case, both in terms of costs and outcome of that in relation to the Crown lands.

A desire to provide certainty for the Crown going forward on those properties, certainty for the private property owners on their properties going forward and to ensure that any past actions that either the Crown or the private land owners had taken on those properties at that
[ Page 4902 ]
the time were protected from any future action — that was the settlement that was reached.

The decision was that the value paid for that against the potential outcomes and costs of going to court…. In order to provide that certainty to both Crown and private owners, that decision was made, and the settlement was reached. The legislation here is to confirm that settlement.

Also, most importantly in this, we could have had the settlement, and both parties could have withdrawn their court action. But we wanted to make sure that we had the legislation that protected any other action against the private land owners, validated all actions taken previously, that there was no further basis for any claim against the province or against any private land owners. That’s the reason for both the settlement and the legislation in order to do that.

G. Holman: I didn’t intend on asking a question or speaking to this legislation, but as I hear the questions and the responses from the minister, I do feel compelled to stand and make a point, ask a question.

I think our side of the House has indicated that from the provincial perspective and for all the reasons that the minister has outlined…. This is not a bad deal from a provincial perspective for all the reasons that you’ve outlined. I think we’ve been reasonably clear about that.

[1715]

It troubles me that this purchase by the province, when you’ve got a chance to recover substantial dollars and still provide those property owners with a very good deal in terms of creating certainty for them…. The province has an opportunity here to recoup some dollars and offset the costs of this acquisition.

I sit on the Finance Committee, and we are regaled throughout the province on the unmet needs, that the province, at this point, has been essentially saying: “We don’t have the dollars for this” or “We don’t have the dollars for that.”

This is a worthy proposal you’re making here. There are so many unmet needs, and the province here has a chance to recoup some of these funds and still provide those property owners with a great deal coming out of this transaction.

Then there’s just the simple matter of fairness, where a whole number of other property owners have, in fact, acquired those rights. There’s a real inconsistency and unfairness of treatment here that really is begged.

Grace Islet is a situation where the province is allowing the construction of a house on a burial site, and the ministry is saying: “We don’t have the dollars to acquire this site.” Well, here’s an opportunity to still give those property owners a great deal, eliminate the uncertainty, confer those timber and stone rights on them and still recoup some funding. I honestly can’t understand why the province wouldn’t take that opportunity.

Hon. S. Thomson: I appreciate the comments of the member opposite. Just again to go back to the point we made, this process was not a purchase. This process was a settlement to extinguish the reservations that existed. As I explained in my earlier response, we did consider the process of purchasing the reservations, which would have brought them back into the ownership of the province. The act could have constructed it in that way. When we looked at all of the complications, all of the administrative processes, all of the challenges of having valuation….

It’s quite a simple process on the part of the member opposite to talk about so much for each property and everybody the same amount and just multiply it out and do that. But that would have created some inequities between individual property owners, depending on the size of their properties, depending on the mix of timber that would be part of that reservation versus private timber, depending on what had happened on that property over all of those years.

As I pointed out earlier, it’s important to recognize that the timber involved here was timber that was in place at the time of the reservation, not timber that had…. If there had been some harvesting and some timber had grown back up, that’s private timber. If there had been a fire, that’s not part of it. So you would have had to sort out all those valuations.

On balance, we did consider all of that. But when we looked at all of the administrative processes and the further challenges and inequities that that would create, the decision was to simply have a process here that extinguished those reservations that provided both the benefits to the Crown and the private land owners in the process.

The amount for this was booked in Crown proceedings, so it doesn’t have an impact on the existing fiscal plan. On taking all of those considerations into balance, the settlement agreement was viewed as the most prudent way to go in order to settle this, to avoid going into the court process, to provide that certainty to all.

[1720]

V. Huntington: Thank you for that answer. I think it would have been quite a complicated effort. As much as it also would have been good for the province, I think it would have been a difficult valuation to make, perhaps.

Were there any large or medium-size businesses involved in these lands — businesses that would be fairly well known that had a lot of activity in timber right or gravel extraction involved in their operations? Have we moved in and supported large companies that perhaps CPR was having claims against at this point? Do you know of any? Could you give us some names of firms that own these lands?

Hon. S. Thomson: In terms of the Crown land, obviously the beneficiary of this settlement is the Crown. The
[ Page 4903 ]
Crown now gets that timber and any stone that would have been part of that.

Again, it’s important to look at what stone meant. Stone doesn’t mean the base minerals and things. I think at that time, in those years, it was construed as being your building stone that you would cut up for blocks and use for building. So the important part of it is the timber.

When you look at the 10,000 properties, 68,000 hectares that are involved, this is a primary benefit to, generally, individuals, smaller landowners. There may have been some of the…. A number of these parcels were owned jointly by a corporation or something like that, but I’m advised that this process does not benefit any major companies. If you were concerned that we were conferring a benefit to a major licensee in this process in some way, that’s not the case.

L. Krog: It’s very interesting when you consider the history of Fernie, which of course has that magnificent downtown because of the two great fires. As the minister is probably aware, the city fathers — they were all fathers in those days — essentially, as I understand it, passed a bylaw that would ensure that all of the buildings in the downtown core of Fernie were made of stone or brick so that when the next fire came through, the whole place wouldn’t go up in smoke again.

So stone, obviously, did have some value back in that period of time. I do note these transfers were made between 1892 and 1907. It wasn’t long after that…. I think the second great fire was 1909.

Now, I have listened carefully to the minister talk about the difficulties. It was seen as more simple, and in the briefing there was a suggestion that there’s not some simple program to place these reservations on all of the titles.

I note that the notice of civil claim itself says, in paragraph 11: “On some of the reservation lands mentioned in the British Columbia land title office, the tree and stone reservations are not noted, endorsed or registered on the indefeasible title, though the three railways and CPR have neither discharged nor released these reservations nor dropped them.”

[1725]

But it’s clear, I take it from that allegation, that the timber and stone reservations are in fact registered against some of the private titles. Is that correct?

Hon. S. Thomson: Yes. I’m advised that for some of the properties, if you go to the land titles office, you’ll see the reservation on the title.

L. Krog: Firstly, can the minister tell the House: does the government have any idea how many titles the reservation is actually registered against, so that if you do the search at the land title office you’ll be able to determine whether or not the reservation is there?

Hon. S. Thomson: I don’t have that number, so I don’t know the specific number on how many would actually be registered on title. The overall number of properties affected, or the estimate, was based on work that was done. A lot of work was done by CP, looking at the bounds of the area, the number of properties, the reservations that were in place — some information where you knew and extrapolated into those total numbers.

But I don’t know the specific number of exactly how much is currently registered on the land title system. That would require going into the current land title system manually to determine that.

L. Krog: That leads me to the obvious question. We’re paying $19 million to settle the claim. That gets rid of the CPR’s claims, but it gets rid of the CPR’s claims vis-à-vis the 10,000 private property owners. Some of them have had appropriate notice of the reservation because it’s on their title. Others have not, and they may be completely innocent, or they may have just taken the risk. Who knows? It doesn’t matter.

If this bill passes and the settlement is carried out, the effect of that will be to grant — not release; I’m going to use the term very carefully — to the private land owners, the roughly 10,000 that we’re talking about, full right and title to their lands.

[1730]

In other words, right now they have the surface rights, so-called, but ownership in the way most of us average homeowners think of it, but not the timber and the stone rights. The effect of the settlement and the passage of this bill will be to grant to those owners title clear, so they get the stone and they get the timber.

How does the government propose to deal with informing those 10,000 owners that they now have their property literally clear title, in the way most of us use that term?

Hon. S. Thomson: What the settlement does, what the legislation does, is extinguish those reservations, both for timber and for stone. If we moved on to the other sections at some point, maybe, then we would go through the fact that this legislation does that.

The process around when that would become important to the landowner…. In many respects, many of the landowners in these cases may not even be aware, and aren’t aware, that they even have that reservation existing over their property — if it isn’t registered on the land title, if they didn’t follow history and weren’t aware of it.

For most of those, it probably won’t make any difference. They’ll go to sell their property, and if somebody raises an issue that there might have been a reservation on here, this act clearly says that that’s not the case anymore. They don’t exist. If it’s on land title registration, they’ll be able to go in and ask for that reservation to be removed. The legislation will give the basis for that to be
[ Page 4904 ]
removed. That could be either done proactively by the province or by the individual.

In a number of cases, I don’t expect it would come up until some conveyance or some sale, or somebody is interested in the timber value on their property. In most cases, if they know about it, they’ll be aware that there’ll be some communication, once the legislation passes, around the fact that there’s been an agreement and that these rights have been extinguished.

People who follow history and know that they may have had that on their property will be relieved. Those that have it registered will be able to proactively have it removed from the title. But in a lot of cases, for a lot of these 10,000 titles and owners, life will probably just go on as they thought it would, because they didn’t know that the reservations existed over their property.

L. Krog: I don’t wish to skip ahead to section 4, and I understand what the minister is driving at in terms of the wording of that section. It’s that “the registrar, on application by a person who is an owner in respect of the railway land, may cancel the registration…” etc. But that will require some process.

In other words, somebody has got to go to the land title office, so to speak — either physically or electronically, as we do now — and file an application, and almost invariably there is a fee.

[1735]

To come back to my point around the money. This allows an application by “a person who is an owner.” It is going to be, as I understand it, then, entirely up to an owner who has notice of this already and who can’t claim that they didn’t, because it’s registered on title. They’re going to have to pay to have it discharged or engage in some process. Or is it the province’s intention to make it a free application, given that all the other folks who were aware of it and have paid for it will get no recompense, and given that the folks on whose title the reservation is not noted will never have had the problem?

As the minister suggested: essentially, life will go on, and they’ll never know they had a problem. It’s a lovely thing in life to have a problem and not be aware of it. But those folks who do have notice, who knew when they bought that there were reservations, because it’s noted on the title — is the province going to pay their fee? Or are they expected to pay a fee?

Hon. S. Thomson: For those people that have it, where it is registered on title, they will have the knowledge and the understanding that that reservation doesn’t exist, by virtue of the legislation.

In most cases, I would expect that they wouldn’t worry about that reservation at all until the time of a conveyance or a transfer of ownership of that property. Then at that time, when they’re going through the process, they would make it part of the application for the conveyance.

I don’t see it being a process, I don’t think, where people would need to apply to have that removed just as a matter of course without looking at some other step or process that they’re taking with their property. They know that they can rely on the legislation, that those reservations have been extinguished.

[1740]

Again, not being sure exactly how many of those are, I’m not sure whether this is a significant issue or not. I am prepared to have discussions with the LTSA on that. But again, I don’t think that this will trigger a rush from a number of people to remove a reservation on their property when they know they can rely on the legislation that it doesn’t exist anymore.

L. Krog: I understand that, but my point is this. Like any charge on a title, you have to do something to get it off. If there’s a builder’s lien that has expired, you have to take steps to get it off. It stays on title until someone takes a step; approaches the land title office; files an affidavit, a document, a discharge or a release — something. In other words, something has to happen.

By and large, there are fees for registering that or taking those steps. Or you’re going to hire an agent or whatever. There has to be something done. It doesn’t just slip off the title, so when you do the search on the property — poof! — it’s gone. That’s not the way it works. My understanding from the briefing was that they don’t…. There is a belief or view that there isn’t an app or a system or a program within the land title system that allows you to remove these charges at the push of a button, so to speak.

In other words, administratively speaking, it would be a process. You’d have to have someone sit down, go back, search the titles back — which, frankly, with electronic registration and microfiching of records and all of those things, might not be that difficult. I don’t pretend to be an expert, but it might not be that difficult.

But at the very time when, in 2013-14, the government clawed back $18 million in family maintenance from single-parent families on income and disability assistance, and the minister tells me — or tells this House, in fairness — that this is all taken into account within the fiscal framework…. And then you have this class of owners in this group of 10,000 who knew what they were buying when they bought, who knew the stone and timber rights were reserved to the railway, who weren’t innocent. They understood; they got the picture.

Has the government considered the small possibility that instead of clawing back money from children, this would be the opportunity I suggested earlier in my questions? Say to that class of people who actually knew what they were buying and presumably paid a market value below those people — those innocent folks who didn’t have the charge on title — presumably paid less…. Would it be so inappropriate to suggest the fee that I threw out of a couple of thousand dollars on a piece of property? If
[ Page 4905 ]
you did it for the 10,000 titleholders — of course, I realize it doesn’t touch all of them — would it have the impact of enabling this government to stop clawing back so much money from children? Has the government considered that as a possibility instead of simply…?

I get the impression today from the government, through the minister, of their sort of throwing up their hands and saying: “It’s administratively difficult, so I’m not going to touch it.” But the fact is that there are — and we have no idea how many — registered owners today in British Columbia who have the reservation on title, who, when they go to sell, are either going to get less than market value for it because it’s on title — but after the passage of this legislation will presumably get more because it won’t be there anymore — or will spend what will probably be a minuscule fee to the land title office to have it removed.

My suggestion is, and question: has the government considered actually charging a more substantive fee when people go to the land title office, who’ve got it registered on title, in order for them to have it removed?

[1745]

Hon. S. Thomson: It’s important to recognize that the quieting of the extinguishment is to the benefit of both those who have that reservation behind the title, not registered, and those that do. In terms of providing some form of fee process or something like that around the process to remove that because they’ve been conveyed, it just further creates the inequity.

The discussion went back to the point of trying to determine a value and a process around all of this, given the complexities of numbers of properties, species mix on those properties, the balance between Crown timber and private timber on those properties, and whether or not there is any stone value with any of those properties. It’s timber and stone, as I pointed out. Most likely where people feel they have the value is on the timber side of it.

Again, it’s just an administratively complex system. In terms of the application process to remove that on the land title, as I pointed out, it’s my view that unless they want to do it proactively for some reason, they won’t need to do it until there’s a conveyancing process or a change in the ownership of the property.

With the settlement legislation, the balance of benefit to the province…. In terms of achieving that settlement, providing the certainty over Crown land — and then, adding into that process, being able to quiet or extinguish those reservations for those thousands of individual private owners as an additional part of the settlement — was viewed as the appropriate decision and the appropriate way to go on this.

L. Krog: I appreciate the minister’s answer, but the minister has focused on a process which I’m not suggesting. The minister has focused, in his answer, on a process that involves valuing the timber and stone rights.

I am suggesting something simpler, which I would argue is obviously at least equitable to those people who bought these lands on which the reservations were registered. I’m suggesting that even if it was a flat fee, the province would recover something — even if it was a straight $1,000 or a straight $2,000 in order to remove the actual charge on the title.

The land title office charges you fees for doing things. The province charges a transfer tax whenever you sell a piece of property in British Columbia: 1 percent on the first $200,000 and 2 percent on the value thereafter. All of us pay income tax. All of these processes are administratively difficult.

The process by which the government claws back payments for children, for heaven’s sake, I would argue is administratively difficult. You have to know who you’re dealing with, you have to check records, and you have to go back and forth. But the province seems to be able to manage that and is able to manage the collection of the property transfer tax and all of those things.

Again, I come back to my point. Perhaps I’m not explaining it very well. If I am a purchaser and have bought the property and it has nothing registered on title, I would suggest, with great respect, that the price I would pay for a property of equal size with equal timber and stone on it would have been less than what I’d have paid for a piece of property where the reservation was on title, because that’s an encumbrance on title.

[1750]

Purchaser A buys the property innocently, doesn’t know there’s this crazy old land grant kicking around from history and buried in dust somewhere in a land title office that reserves the rights to timber and stone. They buy it. They see a title that’s free of those reservations. That’s purchaser A.

Purchaser B, buying a piece of property right beside it, sees that there’s a reservation on title. I think it’s safe to assume, and I think most good realtors would be able to say — and there must be one or two ex-realtors in the chamber, perhaps — that purchaser B probably will pay something less than purchaser A because purchaser A thinks they’re getting timber and stone, everything, and purchaser B knows they’re not.

So we have this pool of people who are now going to get the same benefit at no cost. Out of the pockets of all the other British Columbians, who have no interest in this directly, they’re going to get the benefit equal to the benefit of those who had no idea they had a problem.

Now, I just have to ask the minister: does that strike the minister as fair? Or isn’t this an opportunity, as I suggest, to at least charge some sort of a flat fee that might return a few dollars to the province out of this rather interesting and fascinating historical exercise in the giveaway of our lands 100 years ago and now having to pay to get them back?

Hon. S. Thomson: Again, it’s important to note that we did some work on the assessment where there isn’t
[ Page 4906 ]
any evidence of different valuations with respect to assessment of property values with respect to reservations versus not having those reservations in place.

Again, with the complexity in determining the value of the timber and the stone — the species mix, different sizes of properties — a simple process of a flat fee has the potential to create greater inequities than not. So again, the decision was not to proceed with the idea of purchasing it but to simply look at a process that extinguished those reservations both for people who have it on title and for people for where it sits quiet behind title.

Noting the hour, I move the committee rise, report progress and seek leave to sit again.

Motion approved.

The committee rose at 5:54 p.m.

The House resumed; Madame Speaker in the chair.

The Committee of the Whole, having reported progress, was granted leave to sit again.

Hon. T. Stone moved adjournment of the House.

Motion approved.

Madame Speaker: This House, at its rising, stands adjourned until 10 a.m. Monday morning.

The House adjourned at 5:54 p.m.

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