PROCEEDINGS IN THE
DOUGLAS FIR ROOM

Committee of Supply

ESTIMATES: MINISTRY OF
ATTORNEY GENERAL

(continued)

The House in Committee of Supply (Section A); D. Routley in the chair.

The committee met at 1:36 p.m.

On Vote 14: ministry operations, $427,236,000 (continued).

Hon. D. Eby: I’m joined by Richard Fyfe, Deputy Attorney General; Peter Juk, Assistant Deputy Attorney General, B.C. prosecution service; and David Hoadley, acting executive financial officer and acting ADM, corporate management services branch. Also, a significant number of other members of the public service are here to assist us in this process. I’ll introduce them as they come up to help me.

A. Wilkinson: I note in the ministry operations there are provisions for an increase in the minister’s office budget from $728,000 to $891,000. I’m wondering if he could explain the need for the extra $163,000.

Hon. D. Eby: There are now six staff — a senior ministerial assistant, two ministerial assistants, an executive assistant, an administrative coordinator and an administrative assistant — in the minister’s office. In 2016-17, there were five staff — a chief of staff, an executive assistant, a correspondence officer, an administrative coordinator and an administrative assistant.

The difference between the two offices is our responsibility for now three of the largest Crown corporations — pardon me, two Crown corporations — Liquor Distribution Branch, ICBC and B.C. Lottery Corporation, and the Liquor Distribution Branch, in addition to the pre-existing responsibilities to the office.

A. Wilkinson: Are any of these staff dedicated to the functions related to ICBC, liquor and gaming? Or do they all serve all purposes?

Hon. D. Eby: The job descriptions are as contained in the public service general job descriptions around ministerial assistants, executive assistants, and so on. I’m glad to tell the member that informally, within the office, ministerial assistants do have responsibility for different areas, just for ease of coordination within the office. In terms of the job descriptions, though, they’re consistent with previous job descriptions.

A. Wilkinson: So the incremental budget would cover perhaps one or 1½ or two full-time-equivalents for these new responsibilities?

[1:40 p.m.]

Hon. D. Eby: There are two pieces. One is going from five staff to six staff. The other is the mix of the job descriptions of the staff. Under the previous office, there was a chief of staff, an executive assistant, a correspondence officer, an administrative coordinator and an administrative assistant. Under the current office, there’s a senior ministerial assistant, two ministerial assistants, an executive assistant, an administrative coordinator and an administrative assistant. So it’s those two factors.

A. Wilkinson: Not to belabour this, but $163,000 in the civil service would be a fairly generous salary. Can the minister advise where it’s allocated amongst these staff? Are there increments for each and every one of them, or was the new staff member allocated the full $163,000 budget?

Hon. D. Eby: We’re just nailing down what privacy obligations we may have here, in relation to salaries under $75,000. Above $75,000, I can advise the member that the senior MA budget salary amount is $94,500. The ministerial assistant salary amounts budgeted are $82,500 for ministerial assistants.

Then for the remainder, just give us a sec. We’ll just make sure, before I disclose those, that we’re on safe ground doing so.

Out of an abundance of caution, I’ll maybe, if it’s acceptable to the member, confirm what I’m able to disclose in terms of individual salaries under $75,000 and then provide that to him either tomorrow, when we continue, or in writing, if he’s amenable to that.

A. Wilkinson: The question is, in essence, very simple. Where does the extra $163,000 go? On raises for individuals, on reclassifications or on the single new hire? It’s a very simple question.

Hon. D. Eby: There are two pieces resulting in an increase. One is that there is one additional new person in the office. The other is that there are different categories of employee that are in the office now than were there before. They have different levels of pay. So there are increases.

They’re actually different people who are in the office, for the most part. Two of the people are the same, but the majority of the staff are new hires. They’re different people working under different job descriptions. So some is contained in the different job descriptions of people who are there, and then some is in relation to the fact that there’s an additional staff member in the office.

A. Wilkinson: I think I’ll ask for something in writing on this because the answer has been completely opaque so far, in terms of where the $163,000 goes.

I appreciate the need for some discretion about human resources issues for salaries under $75,000. But on all appearances, there’s either been a reclassification and raises given to ministerial staff and/or the new staff person is being compensated generously with $163,000 allocated to that one position.

In any case, we’ll ask for a written clarification of the disclosure of the nature of the positions — if they’ve been reclassified, what the previous salary was, what the new salary is, what explains the differential in the salary and the new position and how it’s compensated — because the answers have been completely opaque so far.

I’ll move on to another issue of whether there are any ministerial staff to be located outside of the minister’s office in Victoria. More specifically, is there any plan to locate ministry-related staff in Vancouver or elsewhere?

Hon. D. Eby: There are no plans for any of the ministerial staff to be in Vancouver, although there are regularly events in Vancouver where ministerial staff may accompany me from time to time as required by the job.

[1:45 p.m.]

A. Wilkinson: And if I could also have disclosure of the travel and accommodations budget for all those staff.

Now, moving on to another topic. It appears from the answers before lunch that there has, in fact, been no significant or any meaningful increment in the budget to deal with the issues in the mandate letter other than the new sheriffs and the increased staffing for the court services branch. Just to clarify that, the mandate letter calls for “substantive progress on the following priorities.” With the exception of sheriffs and court services branch staff, can the minister confirm that these are not actual performance goals or results, these are actually just aspirational goals and planning priorities?

Hon. D. Eby: I can hear the concern in the member’s voice that we might not be committed to these. I’m very glad to stand here and assure him that the preliminary work, including legislation and active consultation with affected communities, First Nations and stakeholders in the public and private sector, is very much underway.

We went through this before the lunch break. I’m certainly glad to go through it again in detail if it helps the member, but in any event, we are proceeding with the requirements of me and my department in the mandate letter. The member can rest assured that he will see a human rights commission in British Columbia, he will see a referendum on proportional representation that is fair and appropriate, and he will see action on legal aid and our courts. I’m not sure what else I can tell him about that.

A. Wilkinson: Well, I’ll take that as confirmation that the mandate letter goals, which are in the eight bullet points, will not receive any budgetary appropriation whatsoever except for court services and the number of sheriffs. If the minister disagrees with that, perhaps he could clarify that right now, because it sounds as if these are all planning exercises and aspirations rather than actual delivery mandates, since there’s no budget for them.

Hon. D. Eby: With respect, to the member, we all sat through a throne speech not too long ago that was filled with items, some of which were around the order of $1 billion, that were not anywhere to be found in the budget that was put forward by the government. That was the B.C. Liberal throne speech after the election, for which this member and all of the members on the other side voted.

It is not unusual for government initiatives to be the product of consultation with either industry, First Nations, communities affected and stakeholders, and for those to be shaped in terms of the cost and implementation by those processes and to be introduced at a later budget. We are very clear about what we’re doing. We’re engaging in consultation with community. That consultation is going to shape the actual cost and budget of these items.

I understand that the member would like us to have put numbers into this budget update process. That’s his position. That’s fine. But it doesn’t mean that we’re not doing it, and it doesn’t mean that it’s the position of this government.

Our position is that we are going out to the community. We’re getting an idea about what they want to see in the human rights commission. We’re getting an idea from First Nations about how we keep Indigenous offenders out of jail and out of the court system, and how we address legal aid issues and access to justice for families.

I understand that the member has a different approach. It’s not this government’s approach, and I’m not sure how else I can clarify it for him.

A. Wilkinson: I’ll take the minister back to the mandate letter — top paragraph of page 2, in the second paragraph — where it says: “As minister, you are responsible for ensuring members of the B.C. Green caucus are appropriately consulted on major policy issues, budgets, legislation and other matters as outlined in our agreement. This consultation should be coordinated through the confidence and supply agreement secretariat and the Premier’s office. The secretariat is charged with ensuring that members of the B.C. Green caucus are provided access to key documents and officials as set out in the agreement.”

[1:50 p.m.]

Now, I think a good number of people in this room are familiar with the concept of solicitor-client privilege and how any disclosure of privileged material to a non-client or counsel for that client results in a breach of that privilege and privileges lost.

I’m going to ask the minister how he approaches this relationship with the Green Party and whether there’s any disclosure of documents, review of documents or, for that matter, as solicitor-client privilege requires, any instructions to counsel, correspondence from counsel or legal opinions whatsoever that are disclosed to the Green Party in any of these consultations at any time.

Hon. D. Eby: I draw the member’s attention to the last clause there in that paragraph: “…in accordance with relevant legislation.” Certainly, I read that as being a broad direction from the Premier that any discussions with the Green caucus should be in accordance with not just the written laws of British Columbia but also with the broader obligations, including the constitutional and solicitor-client obligations of the office of the Attorney General. I understand it in that way. That’s the way that it’s implemented.

I can assure the member that no disclosure of confidential materials to the B.C. Green caucus — or, in fact, to MLAs from any party, including our own party — is taking place except as permitted by law by the obligations of this office. I, frankly, cannot think of a situation where that might apply, but in any event, it’s not happening. I hope that puts the member’s mind at ease.

A. Wilkinson: In fact, that does not address the question whatsoever in that the reference was to confidential documents, which may be entirely distinct from solicitor-client privilege documents.

The question is squarely addressed to the issue of legal advice to government, requests for legal advice or correspondence from government solicitors. Those are governed by the common law or related to solicitor-client privilege, which has nothing to do with legislation. So I’ll ask the minister to have another try at it.

Hon. D. Eby: I thought I was clear, but my aspirations and the achievement of them can sometimes be different things. Let me try again.

I understand — through my legal education, through my experience as a lawyer and through my time in opposition and now my time as minister — that there are rules that govern the Attorney General’s office around disclosure, around confidential information — whether it’s written down, whether it’s an oral briefing or other information that’s provided to me in that role. I take those obligations very seriously.

It doesn’t matter — whether it is a cabinet document, whether it’s a briefing note concerning a criminal justice matter that comes to me in my role as Attorney General — what the matter is, I take those obligations very seriously. Anything that is confidential and is not to be disclosed has not been disclosed and will not be disclosed to the B.C. Green caucus or any other party that’s not entitled to receive those documents.

A. Wilkinson: Just to clarify, the reference you have made is to confidential documents. I am specifically asking about solicitor-client privilege documents, which is a different category.

I’d ask you to answer that question directly so that we may know that the B.C. Green caucus and anyone affiliated with them does not have any access whatsoever to solicitor-client privilege documents, including draft legislation, so that the public may be assured that that privilege has not, in fact, been lost, which would be a fundamental blunder by your ministry.

Hon. D. Eby: I can assure the member that this includes no disclosure of solicitor-client privilege documents or advice.

A. Wilkinson: I’d like to move on to the issue of the United Nations declaration on the rights of Indigenous peoples. This is included in your mandate letter in that you are responsible for moving forward on the calls to action, innovating policies, programs and legislation to determine how to bring the principles of the declaration into action in British Columbia.

Now, this is an enormous task. I’d just like to ask: what staff have been dedicated to this? Are they in your ministry? Clearly, your ministry provides advice to any other ministries engaged in that process. Is there any budget allocated for it?

[1:55 p.m.]

Hon. D. Eby: It’s my view and it’s the Premier’s view — and I’ve communicated this very clearly to all staff within my ministry, and not just within my ministry but within larger government entities for which I have responsibility — that every staff member has a responsibility around ensuring that they are considering impacts on First Nations, that they are considering how to engage First Nations communities in policy development and implementation.

I’ve been very clear that this is not to be hived off into some sort of silo department. This is a department-wide, ministry-wide obligation on all of us to do better when it comes to First Nations people, which I understand is the unambiguous goal of the UNDRIP document and the Truth and Reconciliation Commission recommendations.

We have staff members that provide assistance to my colleague the Minister of Indigenous Relations and Reconciliation. He is working very hard on that with the assistance of the Ministry of Attorney General counsel. Those are lawyers that are working quite directly with First Nations. We have lawyers that are working in partnership with the Aboriginal Justice Council, directly in consultation and conversation with them about how we can do better to ensure our policy initiatives are being developed appropriately.

We have the Chief Judge of the Provincial Court who has spearheaded the development of First Nations courts across the province and who we are supporting in continuing that work across the province. I was very privileged to be at the launch of First Nations court in Merritt, supported by our government.

The member’s question is a good one. His understanding of the priority that we place on this is clear and obvious, because it is not just in my mandate letter, but it’s in every mandate letter of every minister. As far as I’m concerned, as Attorney General, it should be a priority of all of our staff in improving that.

A. Wilkinson: The minister has outlined what I would call a passive approach. As issues arise, that legal advice will be provided.

[S. Chandra Herbert in the chair.]

More specifically, this mandate letter calls for a review of policies, programs and legislation, which would require active dedication of staff to go through the Revised Statutes of British Columbia, which is an enormous document, and provide appropriate legal advice actively, rather than passively. To do so passively would take generations, and to do so actively would take a dedicated complement of staff.

So the question is: how many staff people have been allocated to this task? How much budget has been allocated to it? There’s no incremental budget to address it in the ministry, so is it coming out of existing staff resources?

This is a truly enormous project for lawyers, which will take thousands and thousands of hours of legal time if it’s done actively. Perhaps the minister can just clarify if it’s being done passively as things arise or if, in fact, there’s a dedicated staff complement dealing with this.

Hon. D. Eby: I’m very pleased to advise the member that we allocated, for the first time, capacity funding for the aboriginal justice committee — $400,000 in capacity funding. The reason why we did this was to ensure that…. As the member says, if you were to go through every law in British Columbia, through all the Revised Statutes of B.C., it’s an awesomely huge project. Fortunately, we can be more efficient than that.

We can partner with First Nations leaders and communities, and they can direct us in where our efforts will be the best targeted. That is why we provided this capacity funding to the Aboriginal Justice Council, so they can assist us in our work in targeting our efforts directly for maximum impact.

I share with the member his obvious concern about the urgency of this matter and our need to address things as quickly as possible. And I share his concern about the length of time it will take to make meaningful change here. That’s why I am so proud and happy that we are working hand in hand with First Nations communities through the Aboriginal Justice Council in identifying these reform opportunities so we can act efficiently and quickly to address them.

As initiatives are identified in partnership, they’re either implemented with existing policy staff within the Ministry of Attorney General or they will go forward in the February budget. I don’t want to create any illusion here for the member that we’re going to solve this all in the February budget. This is a long-term project.

[2:00 p.m.]

It is a long-term relationship and undertaken with our Indigenous partners. It’s something that will take time to address, because it took us a long time to get where we are today. But that does not remove the urgency, and that does not remove the need to partner with First Nations people on this. That’s why we’re doing that.

A. Wilkinson: The obvious question that comes to mind is that if this is to be done at the behest of First Nations leaders and communities, then nonetheless, instructions have to come from within your ministry’s legal staff to actually take concrete steps. That requires some budget for the staff to be paid to move it ahead. Of course, there’s no budget at this point, implying that it will happen in the next fiscal year at best, or at the earliest.

Secondly, this is not particularly a budgetary exercise. This is a legislative exercise. If the idea is to revise policies, programs and legislation, that requires policies, programs and legislation. So the question obviously arises: is there a legislative agenda being developed to implement these changes? If so, when do we anticipate that would come about? You apparently have no budget for it at this point.

The Chair: Members will be reminded that we are to refer to members as members and ministers as ministers.

Hon. D. Eby: We were just taking a second there to try to get a number for the member about how much is spent in terms of policy staff within justice services branch. Unfortunately, it’s not an easy or obvious process. It’s somewhere around $20 million on services that aren’t LSS in justice services, which deal with policy, but that number will also include some other pieces as well.

What I wanted to do is to try to illustrate the philosophical shift that’s happening here. For example, the First Nations court pieces are funded out of the existing court budget. If you are appointing people to different commissions and different boards — for example, LSS — or to the provincial judiciary and you’re making an effort to identify Indigenous candidates for those opportunities, that is within existing budget initiatives.

There are many steps that are being taken within existing budget envelopes to expand the opportunities for First Nations people to participate in the justice system, which affects these communities so disproportionately and so profoundly. So this is the kind of work that is taking place.

In addition, we are partnering with the Aboriginal Justice Council — my apologies; I kept saying “committee,” but it’s a council — and have provided them for the first time with capacity funding so that they can have staff so that they can move forward in a more aggressive way in ensuring that we are aware of what the opportunities are for significant reform. I’ll tell the member that some of it will be within existing budgets, and some of it may be additional budget items for the ministry.

That work is underway, and we are moving forward on it. I share his enthusiasm for it. There are lots of opportunities, and I encourage him to share any suggestions he has about ways in which we might improve our record with Indigenous people.

A. Wilkinson: The minister has addressed what I would call process issues around tribunals and so forth but has not in any way addressed the issue of policies, programs and legislation. That would cry out for a dedicated budget or staff to address the major legislative drafting task to come up with a legislative package that actually implemented the United Nations declaration on the rights of Indigenous peoples in terms of the legislation in British Columbia. That would require an overhaul or at least addressing the large body of existing common law.

[2:05 p.m.]

The question is quite direct and pointed. Within the Ministry of Attorney General and Ministry of Justice, is there any dedicated budget or staff complement to implement the legislative package related to the United Nations declaration on the rights of Indigenous peoples, quite apart from any process issues such as staffing courtrooms and engaging with the public, whether they’re Aboriginal or not?

Hon. D. Eby: I know for a fact that the member is aware that our ministry and our government spends a huge amount of money in relation to, for example, title litigation and other forms of litigation with Indigenous people. The manner in which we conduct that litigation, the approach taken in that litigation — we’re paying for the lawyers; they are already budgeted for — can be informed by the principles behind the UNDRIP document, behind the recommendations of the Truth and Reconciliation Commission. I note that the federal government recently came out with a statement of ten principles in relation to First Nations peoples.

It’s how you inform the policy work and the actual work that’s being done, how you make decisions in partnership with First Nations people. I do appreciate that the member would like to see more in this budget in terms of resources for addressing reform around Indigenous people, and I can assure him that he should stay tuned for the February budget, as we put forward policy initiatives that are informed by our consultations with First Nations people.

In the meantime, I can assure him that we are undertaking processes internally that are ensuring that the actions that the ministry takes are consistent with the principles that are articulated in those rights documents.

A. Wilkinson: The minister has once again avoided the answer, certainly has avoided the question, in that he’s discussed or reviewed currently the instructions of counsel and a philosophical approach to the issues. But in no way have I received an answer in terms of the review of policies, programs and legislation, as directed in his mandate letter, which would require dedicated staff in the ministry to look at the whole of government and the whole of the legislative corpus, which forms the Revised Statutes of British Columbia.

The question is very simple. Are there dedicated staff to this task who are looking to a comprehensive approach to the laws of British Columbia with an eye to a legislative package to be implemented in the foreseeable future? Or is it more of a passive approach in terms of instructions to counsel on an evolving basis and a review of programs as they arise in consultation with external individuals?

Hon. D. Eby: I think that maybe there’s a disconnect between our understandings of these rights documents and what they articulate. At its base, these documents say something very straightforward: if you are engaged in activities that are affecting Indigenous people, they need to be participants in that process.

One of the first initiatives of this government was participation in the First Nations Leadership Council, leadership summit. At that event, we announced — I recognize it’s a small amount of money, but it’s significant — $400,000 for the Aboriginal Justice Council to shape our approach to justice services. They are working in partnership with the First Nations Health Council, as well, which is also funded by our government, to ensure that for the programs that affect Indigenous people in our province, they are participating with us and shaping those programs.

In a number of cases, this money is being spent already. It’s being spent on litigation. It’s being spent on prisons. It’s being spent on courts. How we spend that money, how we allocate those resources, is very critically important.

In addition to that, I agree with the member that additional measures will be required, and they will help us shape those initiatives. We could arrive with preconceived notions and implement them and then hope for the best. But that is the approach that is specifically advised against in these rights documents that the member has raised.

What those documents say is: partner with Indigenous people, have them advise you on what will work best for them and for their communities. That is the approach that we’re taking in the Ministry of Attorney General.

[2:10 p.m.]

A. Wilkinson: I’ll take from the minister’s answers that the paragraph in his mandate letter is, in fact, aspirational and process-oriented rather than results-oriented.

Perhaps the minister can confirm that there is no anticipated statutory package that would lead to a review of policies, programs and legislation to determine how to bring the principles of the declaration into action in British Columbia, which, of course, would require substantial overhaul of the statutes of British Columbia. Perhaps the minister can just confirm that is not happening.

Hon. D. Eby: I can confirm for the member that whatever process it is that he is outlining in his questions is not taking place. But I will absolutely deny the suggestion that we are not moving forward on the calls to action, that we are not reviewing policies, that we are not reviewing programs, that we are not reviewing legislation. This is simply not the case.

We are absolutely reviewing policies, programs and legislation, but it’s not just us doing it. We have allocated resources to the First Nations justice council to assist us in that process. These rights documents are very clear that that is how you are supposed to do this kind of thing. It’s not because of some kind of formulaic adherence to these sorts of things. It’s the way that it should be. When you are making policies that affect a group of people, you should involve people in those processes if you want to have success in your initiatives, and that is what we are doing.

We’re absolutely doing these things, and I don’t know how the member is drawing the opposite conclusion.

A. Wilkinson: Perhaps I can just ask one more time: does the minister anticipate a legislative package to adjust the statutes of British Columbia to review the policies, programs and legislation to bring them in accord with the principles of the declaration in British Columbia?

Hon. D. Eby: I’ll try again. It is certainly possible that in our work with the justice council, they will have recommendations for us, which we will develop together, that will require legislative reform. In that case, a bill would be put before the House to address whatever that issue might be that needs to be addressed through legislative reform.

I can also advise the member that if it does not require legislative reform, that if it requires some kind of reallocation of existing budget that’s intended to serve Indigenous people but isn’t or if it’s a new budget item, he will see it through the budgetary process in the spring.

The process that we are in right now with the First Nations justice council and with our staff is moving forward on exactly what is set out in the mandate letter, which is “moving forward on the calls to action and reviewing policies, programs and legislation to determine how to bring the principles of the declaration into action into British Columbia.”

I would argue that the very manner in which we are reviewing these things is how, in part, we are bringing some of these principles into action. The principle is nothing about Indigenous people without them, and we’re absolutely in partnership with the First Nations justice council on this work.

A. Wilkinson: I’d like to move on to the issue of electoral finance reform. The understanding is that there will be cheques for roughly $1 million issued to the two major political parties in this province on January 1 or thereabouts of 2018, which is certainly within the fiscal year, and I anticipate, in these estimates.

Can the minister explain if that’s coming from his ministry or where that will come from, particularly in light of the fact that the legislation hasn’t passed so there’s no budgetary provision for it?

The Chair: Member, that’s a question relating to legislation in front of the House and would more appropriately be asked when we get to committee stage of that legislation.

A. Wilkinson: Thank you, Mr. Chair. The question, though, is: is there any budgetary provision for this in the ministry or otherwise given that there’s a public understanding that these cheques will be issued in January of 2018?

The Chair: Under the standing orders, the necessity for legislation and matters involving legislation cannot be discussed in the Committee of Supply. Sorry, Member. Unfortunately, Standing Order 61 makes that suggestion — and, indeed, a rule.

[2:15 p.m.]

A. Wilkinson: I don’t see that in Standing Order 61. Perhaps you can point it out to me.

The Chair: It has been the practice of this House that legislation or questions about legislation that is before the House should be asked about that legislation in the appropriate House.

If the legislation had passed, then questions around the implications of such legislation could be raised in this chamber.

A. Wilkinson: Thank you, Mr. Chair. But the question remains valid and stands: is there a budget provision for these $1 million cheques in January or not? That has nothing to do with what is referred to in the standing orders. That is a simple budget question and should appear in the estimates that are the subject of these proceedings today.

The Chair: I’m willing to entertain the question as I see the Attorney General has an answer.

Hon. D. Eby: There is a contingency process for the budget where if a bill passes that has financial implications, then money can be allocated to supporting that bill.

I can advise the member that as a general matter, there is no allocation in the current budget for money to Elections B.C. in order to provide some sort of transitional support for political parties for legislation that hasn’t passed yet.

A. Wilkinson: So just to, if we can, confirm that. If there is to be any provision of $1 million cheques to political parties in January of 2018, it will apparently come from contingencies, and there has been no provision that the minister is aware of in the budget to deal with the machinery at Elections B.C. to process the new legislation. Is that correct?

Hon. D. Eby: There’s no provision I’m aware of in the budget for money for any bill that is not currently law in British Columbia.

A. Wilkinson: In terms of the other components of the electoral reform bills…. We’re talking particularly here about the proportional representation referendum. Can the minister explain what benchmarks were used for that process development in the ministry prior to it being introduced in the House?

The Chair: Member, I would remind the member that we’re dealing with the estimates of the ministry, not legislation and questions on how legislation was created, what consultation periods went through. Those sorts of questions would be best dealt with in the Legislature, where the legislation is being dealt with, as opposed to committee looking at matters of budget of this ministry.

A. Wilkinson: In that case, I’ll easily reframe the question. What budget allocations have been made within the ministry, and what staffing has been dedicated to the development of the proportional representation package in the Legislature?

Hon. D. Eby: I can advise the member that for bills that are not currently law in British Columbia, I’m not aware of any allocation in the Ministry of Attorney General budget for bills that aren’t currently law.

A. Wilkinson: Another item of legislation that’s before the House in terms of its development is the lobbyist reform package, which is very brief and deals with one issue. There’s been reference to a wider review taking place, which is not before the House. Can the minister explain what the timeline is for that review and what its intended scope is?

Hon. D. Eby: We’ve had a number of recommendations from the office of the registrar around lobbying in British Columbia and reforms that are recommended to legislation in British Columbia — not just that office but members of the public and various advocacy groups that have raised concerns.

[2:20 p.m.]

Apart from the bill that’s already in the Legislature, I’m happy to advise the member that there will be a full review process taking place. We expect draft legislation in 2018 dealing with these recommendations. It’ll be subject to consultation, of course, with the registrar, with interested organizations, and we hope to have that reform in place soon.

I understand why the member is interested in it, and we look forward to reforming lobbying laws in British Columbia.

A. Wilkinson: The next item to cover in the mandate letter is the human rights commission. We’ve already established there’s no budget for this at this point. Presumably, there’s a consultation process underway right now through what, I believe, is the parliamentary secretary. Can the minister give us any kind of inkling of what kinds of benchmarks are being used for this process? Is there is any comparator or model being examined in other provinces or other jurisdictions?

Hon. D. Eby: I can advise the member that there was a cross-jurisdictional scan across Canada of human rights commissions. The parliamentary secretary has travelled to consult with First Nations. He’s been at law schools. He’s been at high schools. He’s been in the community. A website has been set up, which was advertised through constituency offices of all three parties across the province.

In addition, there was a significant amount of media work done to raise the public’s awareness that we were undertaking this initiative and to invite comment through the web portal or otherwise — mailing in letters, and so on. I’m glad to advise the member that there has been a great deal of interest in this process.

I myself was at a session at the University of Victoria law school that was very well attended, in which people present raised a number of issues. It was very timely because some hateful posters had been distributed on the campus — certainly, one of the more overt and troubling aspects of some of the racist and discriminatory activity we’re hearing about during this process.

It’s very clear to me, through this consultation process — and which has been conveyed in some summaries to me by the parliamentary secretary — that there is a crying need for this kind of body to do educational work with British Columbians. I look forward to the report from the parliamentary secretary about his recommendations based on these consultations about what the human rights commission in British Columbia should look like, based on best practices from other jurisdictions and the specific needs of British Columbians.

A. Wilkinson: That provides an answer in the most general terms, but the question is actually more specific than that. Is there any emerging model which is attractive to the ministry, and is there any particular jurisdiction that is being used as a model so that we can anticipate where this particular program is going, given that there’s no budget whatsoever for it at this point?

Hon. D. Eby: There are a couple of broad themes that are coming out, certainly, in the consultations that I’m happy to share with the member. One is that there are human rights commissions across Canada and internationally that do primary research around impacted groups in an attempt to provide an opportunity for the broader community to understand why policies might need to change.

For example, Ontario’s Human Rights Commission has done some extensive research in relation to street checks and how those are undertaken in that province. So that kind of primary research is something that people are certainly raising in a number of the consultation processes as being a helpful activity.

The role of a human rights commission as educator is something that is coming up very often: the need for outreach and advocacy and support for education in communities around why it’s important that we have a tolerant and diverse and welcoming community in British Columbia and how to intervene or to identify when there are issues or barriers that are in place that are preventing people from participating fully based on some unalterable physical characteristic or religion or place of origin.

So it’s certainly been a very interesting discussion. I look very much forward to the parliamentary secretary’s report, which will surely grapple with these and other issues that he’s identified. It’s my understanding that the report is due in December, and it will be a publicly available report, so the member will have full access to it at that point as well.

[2:25 p.m.]

A. Wilkinson: Can the minister perhaps clarify what exactly the measures of success will be for a human rights commission and what the established goals will be so that we know whether there’s been success in meeting those goals when it is eventually established?

Hon. D. Eby: Well, the first measure of success I think will be whether or not we implement a commission that is responsive to the concerns of British Columbians that are brought forward through the consultation process that we’re engaging in. The consultation process itself is identifying for us, through the parliamentary secretary, opportunities for us to identify exactly how we will measure that success.

So a human rights commission, just as an example, that assists — perhaps a metric could be — a certain number of people or takes on a certain number of independent research projects. There has been some suggestion that the human rights commission provide a legal clinic type of support for individuals who wish to bring forward complaints or assist businesses in ensuring that their workplace is responsive to a diverse employee base and a diverse customer base. So it might be the number of businesses assisted. It might be the number of individuals assisted.

That is part of what the consultation process is undertaking, and I look forward very much to the parliamentary secretary’s report on this, which should assist both the member and myself in understanding what British Columbians are prioritizing in terms of their human rights commission.

D. Barnett: I have just one main item. My question is: could you give me an update on the ICBC funding that is coming through for motorized trails, the funding through the selling of licence plates for the ORVs and snowmobiles? Could I get an update on the funding, and is it being directed towards just motorized trails, and is the Ministry of Forests, Lands and Natural Resource Operations still going to be the one distributing it through a recreation program?

A. Wilkinson: Now, this question is directed, I think, toward ICBC, so in the event that the ministry wants to take some time to find the right staff or find the answer to that, I’m quite happy to proceed with AG questions in the meantime.

Hon. D. Eby: I just noticed some staff from ICBC came in. Maybe we’ll proceed with Attorney General questions at the suggestion of the member, and ICBC staff will dig up that information for the member from Cariboo. We’ll get that info to her as soon as possible.

A. Wilkinson: I think, in the interests of clarity, it might be helpful to the ICBC staff if they have the question restated so that they know what they’re looking for, since it’s a rather detailed and perhaps fine point. I’m going to ask the member for Cariboo-Chilcotin to restate the question, understanding the ICBC staff will answer it at a later date or a later time today.

D. Barnett: Could the minister give me an update on the ICBC funding that is coming through for motorized trails, the funding through the selling of licence plates for the ORVs and the snowmobiles? Could I get an update on the funding? Is that funding being directed towards motorized trails, and is the Ministry of Forests, Lands and Natural Resource Operations still going to be distributing it through a recreation program?

A. Wilkinson: I’ll look for direction from the minister if he would rather I carry on with AG questions or deal with this immediately.

[2:30 p.m.]

Hon. D. Eby: I can provide a little bit of information to the member and encourage her, also, to speak to the Minister of Forests, Lands and Natural Resource Operations that administers this fund, because ICBC does not manage the trail fund. It doesn’t influence or direct how the funds are to be allocated.

I can advise the member that from March 31, 2017, onward, after the fund was established, $181,000 has been directed to the ORV trail fund.

D. Barnett: Could you just clarify…. Because we did make an announcement prior to the election, and we did know that there was over $300,000 in the fund. I don’t believe, and I could be wrong, that any of it was spent. Some of the organizations are concerned on who is making policy on the trails and who has been included, as this money was designated for motorized trails only.

Hon. D. Eby: We’re getting into matters that took place before the arrival of the new government. But I can advise the member that this fund was only established on March 31, 2017. Prior to March 31, 2017 — so up until March 30, 2017 — $328,000 went directly into government’s consolidated revenue fund.

Once the fund was established on March 31, 2017, by the previous government and since then, $181,000 has been directed by ICBC to the ORV trail fund.

I can advise the member that the explanation of the previous administration for why there was a delay in establishing the ORV trail fund is because there were delays to the Treasury Board regulation relating to ICBC’s cost recovery amounts. As a consequence, there are fewer funds available in the ORV trail fund than ORV stakeholders might have anticipated.

It seems that under the previous administration, the fund had not been set up while the proceeds were being collected. It wasn’t until the fund was set up on March 31 that the money began to be allocated to the trail fund as intended.

D. Barnett: I’m a little bit confused, so maybe you can clarify it for me.

There was $328,000 dedicated for the trail fund through ICBC, but now there is only $181,000. Where did the rest of the funds go?

Hon. D. Eby: Well, while the member was in government with her colleagues, they collected that money. Instead of allocating it to the ORV trail fund, they put it into the consolidated revenue fund up until March 30, 2017. So if she’s wondering where that money went, under the previous government, under their administration, instead of going to the ORV trail fund, it went directly to the consolidated revenue fund.

D. Barnett: Thank you.

A. Wilkinson: To continue on the issue of the Human Rights Commission, the question that obviously arises is: what is the anticipated degree of overlap or duplication or joint jurisdiction between the Human Rights Commission, the Human Rights Tribunal and the B.C. Human Rights Clinic?

[2:35 p.m.]

Hon. D. Eby: This is exactly the subject matter of consultations that are taking place right now by the parliamentary secretary. The tribunal, as the adjudicative body of human rights complaints in British Columbia, was a separate body from the Human Rights Commission previously.

The commission had a gatekeeper function of some type that we are advised resulted in some significant delays for some individuals. So that’s an issue that has been flagged in the consultation process that we don’t want to repeat — the commission being a barrier to complaints actually being heard and resolved at the tribunal. We want to make sure that the relationship between the commission and the tribunal is one that is reinforcing rather than undermining.

The Human Rights Clinic. There are a couple of ways in which individuals can get assistance in bringing forward a human rights complaint. Some are funded in part by the Law Foundation of British Columbia and others. I am certain that the lawyers and individuals involved with those processes are very engaged in the consultation process and that their feedback will be reflected in the consultation report in December.

A. Wilkinson: I would like to turn now to the issue of sheriffs as outlined in the mandate letter. The understanding is that from the February budget provided by the prior government, there is provision for 30 new sheriffs. I’m just simply going to ask the minister to clarify what the plans are for expansion of the sheriffs service, when and how that will be accomplished and more specifically, which numbers we can look forward to in terms of hiring, and where and for what purposes they’ll be deployed.

Hon. D. Eby: I can advise the member that in terms of training, British Columbia graduated 24 sheriffs in May. The new government graduated 30 in September, and we have another 24 starting in January. They will graduate in May.

[D. Routley in the chair.]

In terms of allocation of sheriffs, there were budgetary items about sheriffs being allocated. To the Okanagan, 13 full-time-equivalent sheriffs; and eight to Surrey.

A. Wilkinson: Are there any specific functions allocated to them, or are they general duty?

Hon. D. Eby: All sheriffs in British Columbia are general duty. This is good news, because it enables us, when we have a shortage in one area of the system, to move sheriffs over to fill in where required.

A. Wilkinson: The next question is dealing with the Legal Services Society.

[2:40 p.m.]

We understand, from what’s been said already, that there is no new funding to implement the goal of First Nations legal services, dispute resolution services for families or expanded poverty law services to increase access to justice. Could the minister confirm that, please?

Hon. D. Eby: There’s an additional $2.9 million in the LSS budget in this September update. And $2.8 million of that is for parents legal centres, which have a primary focus of assisting Indigenous families in the court system.

A. Wilkinson: Perhaps the minister can help me, because the estimates document shows an increment from $21.207 million to $22.491 million for an increment of $1.284 million. How much of that is simply dealing with existing services and increased costs and compensation, and how much is actually incremental? I just heard the number of $2.8 million, which doesn’t appear anywhere in these documents.

Hon. D. Eby: Could the member provide a reference for us for the numbers that he gave us there? We’re just trying to find where he’s looking.

A. Wilkinson: I’m showing, for the home audience on TV, the supplement to the estimates for the fiscal year ended March 31, 2018, on pages 26 and 27. Under the heading “Legal Services Society,” the total 2016-17 operating budget was $21.207 million, and the total ’17-18 operating budget is put at $22.491 million, which is an increase of $1.284 million. I’m somewhat dismayed that this document is not readily available to the minister.

Hon. D. Eby: I thank the member for taking us to the section he’s looking at, which has assisted us. The member is looking at legal services, which is not the same as Legal Services Society. It’s the legal services branch. He’s looking at different numbers.

A. Wilkinson: Perhaps the minister can then clarify to me exactly what the Legal Services Society budget was last year and what the increment is to this year and his explanation for the change, which I gather is dedicated to family law services.

Hon. D. Eby: I’m advised the legal services branch is contained in the justice services line item. I can tell the member that the total government funding to the Legal Services Society in 2017-18 is $77.596 million, which has increased by an increment of $2.921 million from the 2016-17 budget total, which was $74.675 million.

[2:45 p.m.]

That’s broken out as follows: $2.8 million of that increment to expand the parents legal centre model, including launching a Surrey location this fiscal, and the rest — $74,000 in 2015-16, $75,000 in 2016-17 and $121,000 in ’17-18, which total $270,000 — for the economic stability mandate and economic stability dividends related to staff salary increases.

A. Wilkinson: In keeping with our earlier conversation on this point, I take it that there is nothing whatsoever in the budget this fiscal year for any increment in First Nations legal services or expanded poverty law services. Is that correct?

Hon. D. Eby: It’s not correct. The parents legal centres are specifically mandated to assist Indigenous families facing the court system and provide them supports in that process. So that’s not correct. We have also provided, as we discussed earlier, $400,000 capacity funding to the Aboriginal Justice Council to assist us in our work going forward and improving services for Indigenous people.

A. Wilkinson: So out of the $78 million budget, we see $400,000 being allocated to First Nations legal services. The question then arises of the outstanding issue of expanded poverty law services. As far as I can tell, there is nothing whatsoever allocated to that during this fiscal year. Is that correct?

Hon. D. Eby: I thank the member for the question. I share his concern about the urgent need for poverty law–related services. I worked in the sector for a long time. It is a priority for our government.

It’s also a mistake, I think, to try to separate out Indigenous legal services, poverty law–related services, legal services related to vulnerable women and so on, because so often these groups intersect in quite a disproportionate way. The $2.8 million for parents legal centres are assisting families that are in poverty that are facing the court system — child protection hearings, and so on. Many of these families are Indigenous, many of them living in poverty.

But I take the member’s point that the February budget should reflect additional support in relation to First Nations legal services, poverty law services, and so on. That consultation work to ensure that it’s well directed and well spent is underway right now, as I’ve advised the member.

A. Wilkinson: So I’ll take that statement about expanded poverty law services to be aspirational and that, in fact, there will be no substantive progress toward it until the February budget. Is that correct?

Hon. D. Eby: Well, I guess the member would have a hard time convincing the families that are going to benefit from these parents legal centres of his position, but I take his point that there’s more for our government to do.

We’re making up for 16 years of neglect in this sector. I think a lot of people remember, in 2002, when legal aid was dramatically cut across the province, when courthouses were closed and supports for vulnerable people slashed in the legal system. The consequences that flowed from that for our justice system…. It’s going to take us some time to deal with that.

I take the member’s point on that, but I would disagree with him in his overswing in suggesting that nothing is being done when it is exactly the opposite. We’ve got a number of active processes underway and some immediate relief for parents facing the court system who live in poverty, many of whom are Indigenous.

A. Wilkinson: The next area of query is the issue of court delays, both civil and criminal.

We’re all aware of the Jordan decision from the Supreme Court of Canada. I’d ask the minister to clarify: how many, we’ll start with, indictable offences have resulted in dismissals in British Columbia due to court delays under the Jordan decision?

[2:50 p.m.]

Hon. D. Eby: This is a very concerning matter, certainly for me as Attorney General and, I know, for all of our staff within the ministry — and also, I would imagine, for the courts and the broader community.

The Supreme Court of Canada has put very strict timelines on us in terms of the hearing of criminal matters. If we fail to meet those timelines, cases can be stayed, which means, functionally, that someone walks out of the courtroom without hearing a finding of guilt or innocence or, potentially, a sentencing. So it’s a very serious matter. It was the subject of considerable concern at the federal-provincial-territorial Justice Ministers meeting. All of us are working together with the federal Justice Minister on improving efficiencies within the criminal system, and it is a very serious issue.

I can advise the member — and this is based on a calendar year for 2017, not a fiscal year — that in the 2017 calendar year, 25 Provincial Court adult criminal cases — that’s 12 provincial Crown prosecutions and 13 federal Crown prosecutions — were stayed. In the Supreme Court, four Supreme Court cases — that’s two provincial Crown prosecutions and two federal Crown prosecutions — were stayed.

The member will know, with his legal background — but for those who may not — that these Provincial Court or Supreme Court cases…. In our Provincial Court, we may have indictable offences. Some of these prosecutions may be indictable. They may be summary. We have federal Crown prosecutions, which typically are drug-related prosecutions, though not exclusively. They are federal matters of jurisdiction. That’s why there’s the breakdown between the provincial Crown prosecutions and the federal Crown prosecutions, over which we do not have control.

As far as the province goes, again, 12 provincial Crown prosecutions at Provincial Court were stayed, and two provincial Crown prosecutions at Supreme Court were stayed.

A. Wilkinson: We’ll come back to this momentarily. The minister says we do not have control over these, but surely the bottleneck is at the court services branch or in judicial appointments. We’ll return to that momentarily. I’m going to ask the minister for a breakdown of the nature of the charges, given that this is not a huge number of cases. If we could have that right now, please.

[2:55 p.m.]

Hon. D. Eby: I can advise the member that we don’t have that information for him, but I can also clarify a statement that he made — or, maybe, a statement that I made — if it’s helpful. When I said we don’t have control of that, the prosecutions are conducted by the federal Department of Justice, and they are independent of the provincial government. They’re an entity of the federal government. We don’t have conduct to these prosecutions. It is run by a different level of government, so as I said, we don’t have control over that. That is what I meant by that.

I take the member’s point, though, that we have a very serious issue in resourcing of our courts. The appointment of judges…. I’ve appointed six new Provincial Court judges since becoming Attorney General.

The shortage of sheriffs. I went through with the member the numbers of sheriffs we’re running through the Justice Institute to train them up, to get them out there as quickly as possible. We’re currently flying sheriffs around the province to keep courtrooms open.

The shortage of registry staff, resulting in delays not just on the criminal side but also on the civil side, delaying adjudication of British Columbians’ disputes. We’ve got a lot of work ahead of us. This is a system that has been very neglected.

I think the point of concern for many people who don’t have an active file in British Columbia courts is that criminals may not be adequately tried and punished in our province, because we didn’t get them to court in time. I have that concern as a priority for our ministry — to address it to ensure that we have it in hand. We are working hard on it, but it is a very serious issue.

A. Wilkinson: I come back to the earlier point that the reason for delays leading to charges being stayed is, in the public mind, related to a lack of sheriffs, a lack of courtrooms, a lack of clerks, a lack of judges. If the minister has a rationale and an understanding of this being some deficiency in the federal prosecution service, we’d like to know that.

Secondly, if we can get a breakdown of the reason in each of those cases as to why the charges were stayed. Was it lack of availability of a sheriff? Was it lack of a courtroom? Was it lack of a judge? Was it lack of a clerk?

I assume that’s readily at hand. I’m going to suggest we take a ten-minute break and get the answer when we return.

The Chair: The committee is in recess for ten minutes.

The committee recessed from 2:57 p.m. to 3:08 p.m.

[R. Kahlon in the chair.]

A. Wilkinson: Mr. Chair, before your entry into the room and prior to the break, there was a request for a disclosure for some information about a few dozen stayed charges, the nature of the charges and the reason for their being stayed due to lack of court clerks, judges, courtrooms or sheriffs. I believe that answer is in process.

Hon. D. Eby: I have been remiss in sharing with the room the staff who are assisting me in these matters. Behind me, Jenny Manton, the executive director of court services, and Lynda Cavanaugh, ADM court services are assisting with this. James Deitch, justice services branch has been helping out on the Human Rights Commission and LSS questions, and I believe the rest of the staff I have introduced already.

[3:10 p.m.]

I can advise the member that between April 1, 2016, and October 25, 2017, we had 19 courtroom closures and 20 delayed openings due to sheriff shortage. I can also advise the member that typically in these stays there is no one reason given for why the stay is issued — for example, there wasn’t a sheriff in a courtroom. Usually it is a delay that has built up over a number of different reasons for the matter not coming quickly before the court.

Often some of these are attributable to the defendants, some to the Crown, and then it’s the court’s job to sort it out. For example, in cases that we have seen in British Columbia discussions, there might be an issue around discovery, around getting all the documents over in a timely way to defence counsel. There might be an issue around extradition and whether the defendant was brought in front of the court sufficiently quickly. It might be contributed to by staffing and court schedule backlogs because of a shortage of Provincial Court judges, so a court isn’t available to hear the matter for an extended period of time. That might be compounded by issues of a shortage of sheriffs or other key court staff.

It would be nice if there was one particular issue or one silver bullet to address this issue. There is not, and that is why it was a subject of discussion at the federal-provincial-territorial Justice Minister meeting. It requires a multi-jurisdictional…. We need the feds’ support on this in terms of having adequate resources at the B.C. Supreme Court level but also their assistance in ensuring that criminal procedure rules make sense and are efficient in getting matters in front of the court as quickly as possible.

We have our own work to do in relation to ensuring efficiency of processes. I share the member’s perspective that it is unacceptable that we have stays due to delay, and we should be focused on that. I can ensure the member that we are.

A. Wilkinson: I’m going to ask for a letter from the ministry outlining a few points. Perhaps this will appear on the record, and they needn’t write it down.

First of all, the number of stays in the period noted, basically fiscal 2016-17 plus the period to date, both indictable and summary offences; the level of courtroom it took place in and any attributed delay; the date of the stay, because obviously it has to issued by a judge; and any discernable or apparent reason for it, either stated by the judge or known to the court system, as to why the delay occurred; and also if it’s a matter of physical plant logistics, such as sheriffs and courtrooms, to state that for each and every one of those stayed charges. I believe the total was about 30, and I would ask for that to be disclosed.

The second thing I’m going to ask for is on the civil side. For about 20 years now, the superior courts for sure and perhaps Provincial Court — I don’t know — have kept statistics on the length of trial and the delay in coming to trial, the number of trials that are bumped or do not proceed because of the lack of a judge or a courtroom and also the number involving lay litigants.

I’m going to ask that that information all be disclosed in a letter from the ministry in a timely fashion. Also, if at all possible, the number of days in the courtroom involving lay litigants in the civil system, probably over the last five years, so that we can see if there’s a trend line in terms of the number of days of courtroom time allocated to lay litigants who represent themselves.

I think, at that point, I’m going to hand the floor over to my colleagues, who are going to talk about restorative justice.

M. Morris: Going to the mandate letter for the Attorney, the second-to-last bullet: “Work with First Nations to set targets and take action to reduce the number of Aboriginal people involved in the justice system and incarcerated.”

Of course, we know that there’s an inordinate number of First Nations folks that are in our jail system, in our provincial corrections system. I guess I go more to this particular bullet. With my experience working in rural British Columbia and remote First Nations communities, one of the most significant factors…. And I’ve seen this statistic right across Canada as well.

[3:15 p.m.]

For a lot of our First Nations women and children, male and female, there’s a reluctance to come forward to report sexual abuse. I’ve heard figures as high as 70 percent of the folks don’t come and report sexual abuse files. A lot of that has to do with the stigma that’s attached to it.

I had communicated with a group of women from the Downtown Eastside that had been marginalized and involved in the sex trade. More than one of them had come up to me and said that they were afraid to go back to their communities because they didn’t feel that they were supported. And because of the things that had happened to them as children, you know, from a sexual abuse perspective, family members that had abused them, friends, they were just too afraid to go back to their communities.

This is a big item, and I don’t see any money being put into this particular item. If it’s a bullet in the Attorney’s mandate letter, where is the money to work with this? Where is the money to provide some kind of relief for the victims and the many, many people that don’t report sexual abuse to the authorities, to the police, to the court system, yet it’s known throughout the community.

I’m just wondering what the Attorney plans on doing with respect to that bullet and addressing these issues and whether he’s looked at the effectiveness of healing circles, traditional First Nations experience in restorative justice — and even our own communities, in restorative justice programs that we have. We’ve got some great ones here in British Columbia in some of the communities that we have in B.C.

But this is a big void in the system. This is something that I think we need to wrestle to the ground, to get the communities more engaged, find some safe place for these people to come forward and tell the community that they have been sexually abused and assaulted, have an opportunity for the perpetrators to come into a safe place and admit that and then come up with some solution as to how we’d remedy that through some kind of a restorative justice system.

There are no dollars attached to it. It’s a big issue. I’d just like to hear what the Attorney might have to say on that.

Hon. D. Eby: I thank the member for his question. I certainly share his concern around not just the Indigenous community but more generally that victims of sexual assault feel that they can come forward and bring their concerns forward to police and that they’re supported through the prosecution process and so on. It’s certainly been a topic of conversation more broadly in society currently, and it’s one that as legislators we certainly need to be aware of.

I share the member’s concern about the decimation of legal supports for rural Indigenous communities, especially the cutting of the native court workers that used to be present in many communities across the province. The need for legal supports in those communities — I share that concern. I can advise the member that… He has a perspective on what the communities, the First Nations community, needs. To that end, we have provided $400,000 in capacity funding to the Aboriginal Justice Council.

The reason why we funded this group, which existed before but never had capacity funding, was because we need the active and engaged assistance of First Nations leaders and communities in directing resources in a way that make sense for them. They are in the best place to tell us how we can ensure justice for community members, and we look forward very much to their advice to us about how best to deal with the crisis around access to justice for Indigenous community members who are far too disproportionately represented in our justice system.

I can tell the member that in terms of that bullet, it is informed by a larger piece of the mandate letter which talks about the UN declaration on the rights of Indigenous peoples and the Truth and Reconciliation Commission recommendations. I would say, if there was an overarching theme of those documents…. The First Nations community needs to be involved in directing matters that affect them. So if you’re putting funding into the justice system to assist First Nations communities, you better have those community members involved in your processes and designing that from the ground up.

That is why we’re funding the justice council. That is why we’re working with the justice council and with leadership across the province to ensure that our measures are responsive to the concerns of those communities.

[3:20 p.m.]

I’m very proud of that work, and I’m very honoured that the Premier has asked me to take that on in the mandate letter. I thank the member for the question, because it is a critically important issue.

M. Morris: One follow-up. It is significant. I think $400,000 seems pretty insignificant when you look at the size of our province — 203 First Nations groups throughout the province, a lot of them in remote parts of the province that costs a lot of money to get into those particular areas and deal with it.

Again, these are issues that First Nations groups have been involved in now for a long time. They already have significant answers. There are some pretty interesting restorative justice programs that are already in existence in some of these communities, in some of the remote communities.

I know I worked with one in New Hazelton and the Hazeltons back in the early 1990s. So there are some opportunities here. I would hope that the Attorney would go back and have a closer look at this. Instead of $400,000, maybe they can look at a sum that is more reflective of the vastness of this province, the remoteness of the province and the amount of work that is necessary in just about every one of these First Nations communities to try and address the issues of sexual abuse and sexual assault in those communities.

That’s the only question I have. I’ll turn it over to my colleague for further questions once the Attorney is finished.

Hon. D. Eby: I can advise the member — he wasn’t here — we talked about $2.8 million for family justice centres that will be assisting First Nations families facing the court system. So it’s not fair to represent what we’re putting forward as only $400,000.

In any event, I think it’s important to recognize where we came from and where we are today. In 2002, there was a massive cut to legal aid across the province and closed courthouses, especially in rural communities. In addition, over the period 2002 to 2017, the previous administration systematically cut funding to the Legal Services Society. It resulted in the withdrawal of native courtworkers that used to be present across the province providing support in exactly the rural communities that the member is talking about.

I agree with the member. There is a crisis around access to justice and justice in Indigenous communities in the province. Where the member and I, I think, part company is in how we reconcile the record of the last 16 years with the suggestion from the member that this government, in 100 days or so, has failed to take on the issue head-on.

We have funded the Aboriginal Justice Council to come forward to assist us in the very heavy lifting that it is going to take to restore justice services to Indigenous communities. We are supporting the chief judge.

I don’t want to pretend, and I won’t pretend, that the previous administration didn’t do anything. That would be a far cry. I think the previous administration should be recognized for their support of the chief judge in establishing First Nations courts in communities in British Columbia.

Those models are working, and we will work aggressively to expand those models. But it certainly is not enough. It certainly does not go to the issues that the member talked about, issues that should have been canvassed more thoroughly in the Missing Women Inquiry that were not because of the failure of that commission, issues that should be dealt with in terms of the disproportionate representation of Indigenous people in the homeless population, in the sex trade and survival sex work population. It is not an acceptable situation.

So we find ourselves in this situation. We will be moving to address it. But the core principle is that we need First Nations people as partners in doing this heavy lifting work, which is why we are funding the Aboriginal Justice Council to assist us in that work.

J. Isaacs: Restorative justice is a part of the criminal justice system. It focuses on repairing the harm done to those who have been affected by a crime or an offence. Those who are involved in the crime or the offence participate in a reconciliation process and come to a resolution that restores and repairs the harm done.

RJ organizations work with the police, schools, courts, retailers and community. Restorative justice is effective and benefits the community in many ways. There are fewer recommendations to charge offenders, which frees up the system to deal with more appropriate court cases. There is simplified reporting and an easy referral process from police to a restorative justice facilitator.

[3:25 p.m.]

In the Tri-Cities, where I was on a restorative justice board, we determined that each referral is estimated to save about nine hours of police time. It’s a cost-effective approach. The John Howard Society states that RJ saves approximately 90 percent of costs that go through a criminal justice system. There is a lower recidivism rate of offenders. Offenders that go through an RJ process are 90 percent less likely to reoffend.

It creates safer communities through restored relationships. The rate of satisfaction in our Tri-Cities RJ board was nearly 100 percent. It strengthens community capacity for addressing crime and conflict.

Some RJ organizations receive direct funding from their municipality. However, not all organizations have guaranteed funding, and therefore recruit facilitators on a volunteer basis. Then they also need to seek out additional funding through grants and donations in order to deliver their programs and services to their community partners.

So my question to the minister is this. Given the fact that RJ is a proven model that restores harm, increases accountability, lessens the risk of offenders recommitting crime or continuing on a destructive path of crime, is a more efficient use of our court time, saves on court costs and police time, would the minister commit to developing a strategy for a provincial-wide restorative justice model that would include sustainable funding for RJ organizations?

Hon. D. Eby: I can advise the member that the current provincial funding in relation to restorative justice flows through the Minister of Public Safety’s ministry. But I can share this. I agree with her, absolutely, that restorative justice is a very effective means of driving down court costs and bringing humanity back into a process that can be, in some situations, healing for both victims of crime and perpetrators of crime. It is not appropriate for all situations, but certainly, for some situations, it is.

I think that the First Nations communities in B.C. should be recognized for their role in championing and encouraging the adoption of these kinds of models through traditional justice initiatives within those communities. So recognizing the heritage of restorative justice models and the effectiveness in some cases for it, I can agree with the member absolutely — that these are the kinds of initiatives our government should be looking at and, in fact, is looking at.

I can also advise that in terms of Indigenous offenders, which is specifically part of my mandate letter, and doing what we can to address the overrepresentation of Indigenous people in our court system generally and in our prisons, restorative justice will have a role to play there as well. To the extent that the Aboriginal Justice Council feels that this will be an effective means of addressing these kinds of issues for their community, then we will be moving forward on that.

Also, I would like to take a moment to reflect on what’s driving a huge and disproportionate impact on our criminal justice system that is not appropriate for restorative justice initiatives. That’s where people are dealing with mental health and addiction issues. The Vancouver police, along with the RCMP and many other smaller municipal police forces, have identified mental health and addiction issues as driving a grossly disproportionate level of their caseload. It’s overwhelming our courts. It’s overwhelming our prisons, both provincial and federal institutions, and that is why I’m very proud that the government is moving forward, with the minister responsible for Mental Health and Addictions, to get a handle on these things.

This is something that, in addition to initiatives like restorative justice, is working to keep Indigenous offenders out of prisons and to, where appropriate, reduce the numbers in our court. This is where we can start to make a real difference. I feel, as the member clearly does, that spending money on courts and prisons…. We can probably do things better for some people, for some individuals, in some circumstances. Let’s make sure we’re spending our money wisely and humanely and getting better outcomes for everybody — victims of crime and perpetrators of crime alike.

J. Yap: Thank you, Chair, for this opportunity to share some remarks as we proceed with the estimates debate for the Ministry of Attorney General, focused on the Crown corps.

[3:30 p.m.]

First of all, I want to say a big thank-you to all of the hard-working men and women in the ministry, throughout the province, and a shout-out to those staff who are working diligently here today to support this process. I’m pleased that we will have an opportunity to discuss matters relating to ICBC, liquor and gaming. It’s my pleasure.

As the Chair will know, I had the opportunity, in the past government, to be the Parliamentary Secretary for Liquor Policy. Now I’m the critic for this area as well. I’m proud of the accomplishments we achieved on the liquor file when we were in government. People told us that B.C.’s outdated liquor laws needed to be modernized, so we undertook an extensive provincewide consultation effort. During the estimates debate, we’ll canvass some aspects of that.

The final report of my liquor policy review took into account 65 stakeholder meetings, 188 stakeholder submissions and the on-line input of about 76,000 British Columbians. We made 73 recommendations to modernize B.C.’s liquor laws, and the previous government acted on most of them.

Some of the changes I’m proud of include the introduction of happy hour at pubs and restaurants; the sale of B.C. wine in select grocery stores — and we have two in my community, Richmond; the sale of B.C. products in farmers markets — a big hit throughout the province; and a simpler process for special occasion licence applications used for events like small weddings and music festivals, which touch so many British Columbians.

It was one of our most successful consultation efforts, and those changes supported industry, boosted tourism and increased consumer convenience, while keeping health and public safety top of mind, as we should.

On the ICBC front, the previous government committed to working together with ICBC to mitigate pressure on rates through a number of measures. I’ll just name a few: continuing to fight against distracted driving, which is a scourge; focusing on stopping fraudulent and exaggerated claims; shrinking ICBC’s executive team as well as executive compensation; and hiring more front-line claims staff so customers continue to receive quality service as the numbers of claims continue to rise. So there are a number of challenges that we tried to address.

I know the minister’s mandate letter requires him to conduct a comprehensive operating review of the organization. PwC Canada has been selected to lead that review, and I’m sure we’ll be discussing this in some detail during the estimates debate — as well as this government’s raising of ICBC rates by 8 percent, which sadly amounts to a broken promise.

As far as gaming is concerned, I think we can all recognize that this is a financially important asset for the province, as gambling revenues support a broad range of programs and services that all British Columbians depend on. The community gaming grant program provides funds to non-profit groups across B.C. in areas like sports, arts, culture, public safety, human and social services.

Gaming operations in B.C. need to be regulated to ensure the integrity of gambling industry companies, people and equipment. We need to employ the appropriate controls to keep criminals out and prevent money laundering, and it’s imperative that any allegations of wrongdoing are fully investigated.

I think it’s important to note that the stories we’ve heard recently in the media are based on work currently being done by the authorities, and we have faith in their abilities to handle criminal investigations without political input or interference. This has been an ongoing investigation, and I hope that in this debate and elsewhere, we’ll be sensitive to that and avoid doing anything to impact or jeopardize that.

Finally, I would say it’s also important that we have the mechanisms in place to look after those who suffer from problem gambling or other social issues that arise. These are some of the issues that I imagine we will canvass during this debate.

I’d like to start out today’s discussion with a general comment and question. Chair, the minister has quite a full plate, lots of different wheels in motion on the legislative front and a number of reviews underway. I’m sure he’s done a fair amount of strategic planning. I wonder, as a start, if the minister could tell us what the minister sees as his largest priority in managing the Crown corporations that report to him.

Hon. D. Eby: I thank the member and recognize his work as minister responsible for some of the areas we’ll be talking about here and his role as critic. I look forward to hearing his questions about this.

[3:35 p.m.]

I would like to take a moment and introduce some of the folks behind me. We’ve got Steve Crombie, VP, corporate and stakeholder governance; Nicolas Jimenez, vice-president, insurance strategy, product and pricing; and Olga Kuznetsova, director of financial planning and reporting, all from ICBC. There are other staff here that I’ll introduce as they come up and answer questions in relation to these different areas.

I think that, if I may…. I thank the member for his broad question. To ensure that life is affordable for British Columbians is the priority in relation to the Crowns. That takes different forms, obviously, in relation to each unique Crown. But whether it’s a revenue-generating Crown, like the B.C. Lottery Corporation, or whether it’s a Crown that has an impact on people in terms of their insurance rates that they pay annually, like ICBC, the mandate that the Premier has given me in relation to Crowns is to ensure that life is affordable for British Columbians. That is the goal that I bring forward.

Unfortunately, there are issues that we need to deal with that, frankly, should have been dealt with a while ago that are having an impact on affordability, and not just affordability but public confidence with respect to some of these Crowns. With respect to ICBC, enormous — multi-hundred-million dollar — deficits on an annual basis. With respect to the B.C. Lottery Corporation’s operation of casinos for service providers in the province, very serious allegations of money laundering that we have brought in an independent reviewer, Peter German, to investigate and to make recommendations to us.

So there are issues that we’re having to deal with, but the overwhelming mandate from the Premier — apart from issues of public confidence in the administration of our Crowns — is to ensure affordability for British Columbians.

That is why we are focused on working very closely with ICBC, with the B.C. Lottery Corporation and the gaming policy and enforcement branch, and with the liquor distribution branch in ensuring that we have public confidence that things are getting back on track and that the services that they provide, whether generating revenue for British Columbians or providing services to British Columbians, are affordable and that the revenue is offsetting costs that would otherwise have to be obtained through taxes, or we’d be able to provide fewer services to British Columbians.

Those are the issues that confront us on these points that the member has come to ask questions about. I thank him for the opportunity to discuss big-picture issues.

J. Yap: Would the minister be willing to share with us on paper the current status of the appointed board positions at ICBC and BCLC — if there are any vacant seats, who currently holds what seat, when they were appointed? If we could include the end-of-term date for all sitting members and whether they are eligible for reappointment, that would be helpful. Would the minister be able to provide that?

Hon. D. Eby: Perhaps, just for ease of staff — I don’t know if the member feels comfortable with this — if we could do all ICBC questions and then all BCLC questions and all LDB, so we don’t have a whole bunch of…. That would certainly assist.

The current ICBC directors are Doug Allen, Jeremy Bell, Maureen Howe, Joy MacPhail, Kevin McIntyre, Cathy McLay, Bonnie Pearson and Inde Sumal. Doug Allen’s term expires July 31, 2020; Jeremy Bell, July 31, 2020; Maureen Howe, December 31, 2017; Joy MacPhail, July 18, 2020; Kevin McIntyre, December 31, 2017; Cathy McLay, of July 18, 2022; Bonnie Pearson, July 31, 2020; and Inde Sumal, December 31, 2017.

I can advise the member that…. I’m trying to remember. The original date of appointment the member wanted as well?

Interjection.

Hon. D. Eby: I don’t believe there are any term restrictions. So all of the members are eligible for reappointment. ICBC does not have a restriction on multiple terms of directors.

J. Yap: I thank the minister for that.

Does the minister envision changing the governance structure at ICBC, B.C. Lottery Corporation or at LDB?

[3:40 p.m.]

Hon. D. Eby: The governance structure of a Crown corporation, for ICBC and B.C. Lottery Corporation — or the Liquor Distribution Branch, which is not a Crown…. There are currently no discussions about either bringing them into government somehow or privatizing them or some other change like that.

I can advise the member that there is a review underway — which he mentioned in his opening remarks, but just for the record — that may have recommendations about it. We certainly invited a broad-ranging set of recommendations. There may be recommendations about governance. I can’t foreclose that, although that was not something that was specifically identified, with respect to ICBC, as an area that we were asking for the review to look at. But it’s not out of the question that that might come forward.

Similarly, Mr. German’s review of what’s happening at casinos may lead him to make recommendations about oversight or governance related to the gaming policy and enforcement branch’s role in relation to B.C. Lottery Corporation or vice versa, or a service provider’s role in terms of their overseeing a casino. We’re looking forward to seeing his recommendations as well. These are very serious reviews, and it’s not out of the question that they might make some kind of recommendation of that type.

J. Yap: I’d like to talk about the mandate letters for LDB and BCLC, addressed to Blain Lawson at LDB and Bud Smith at BCLC. They appear to be identical, other than the entities involved, and there’s no specific direction, no specific goals directed to these organizations. Surely this doesn’t suggest that the organizations are seen as interchangeable. I wonder if the minister could comment on that.

Hon. D. Eby: Actually, there are a number of very specific provisions in relation to B.C. Lottery Corporation, in a mandate letter to them, that are unique to that Crown corporation. They were provided in a supplementary letter to the B.C. Lottery Corporation. I’m happy to provide the member with a copy of that letter.

I can also advise the member that, given the tight timelines of the delay between the election and the swearing in of the new government and the establishment of the new budget, most Crown corporations received very similar letters from their ministers and that mandate letters reflecting the new government’s direction will be in place for fiscal 2018. As I noted, we do have a supplementary letter that went to the B.C. Lottery Corporation, in addition to that letter that the member was talking about. I’m happy to provide that to him.

J. Yap: I thank the minister for that. I asked this because the mandate letter for ICBC, addressed to Ms. MacPhail, is much more detailed — the specific direction and reviews and strategic planning. There is a review underway at BCLC. I guess it begs the question: does the minister not feel that the board chair at BCLC needs direction to cooperate? Ms. MacPhail is very well known, and your appointee. It appears that there’s a shorter leash on Ms. MacPhail. I’m just wondering why that’s the case.

Hon. D. Eby: I’m not quite sure how to respond to the member’s question. ICBC’s board was given a mandate letter. B.C. Lottery Corporation was given a general mandate letter and a supplementary letter. There are requirements for both organizations that attempt to respond to the unique circumstances faced by both organizations. It was not particular to who the board chairs were that these letters were drafted or prepared.

J. Yap: I thank the minister. The supplementary letter — if he could provide a copy of that, that would be much appreciated.

I’d like to focus a little bit of the next few questions on ICBC. I think it’s safe to say that, regrettably, ICBC is currently not the most beloved institution in our province. Public approval of the public insurer is quite low. I wonder if the minister sees this as problem that needs to be addressed. How would the minister like to see ICBC tackle their image problem?

[3:45 p.m.]

Hon. D. Eby: I hesitate to…. This is the estimates process. I don’t want to treat it like a question period process, but I do want to try to state the facts as best I can. ICBC is a public asset. It belongs to all British Columbians. The reason why ICBC was established was with the hope of providing affordable insurance rates to British Columbians that would not otherwise be available through a private delivery model. The corporation had considerable reserves, and those reserves were transitioned from ICBC to general revenue for the province of British Columbia.

Unfortunately, ICBC is currently in a financial crisis, where it desperately could benefit from those reserves, which are no longer there. In addition, difficult conversations that needed to take place with material damage suppliers, with lawyers — two groups that benefit from ICBC, in the form of participating in either the court system or the repairs to automobiles — were not had. As a result, costs continued to escalate to the point where 25 cents of every premium dollar is going to legal services, and we have seen double-digit increases annually in automobile repair costs.

So we are currently having those conversations with those groups. We are currently engaging in a process where for the first time, as far as I’m aware, a reviewer has been directed to speak specifically to front-line employees for their suggestions and issues that they may have identified in terms of reducing costs to the insured public.

I think what is driving what the member suggests…. I take the member’s word for it. I don’t know. I haven’t seen polling on this. But if there are public concerns about ICBC, it’s about the fact that their insurance rates are continually going up, yet ICBC is losing hundreds and hundreds of millions of dollars. There doesn’t seem to be an end to that. We need to reverse that and fix that.

I believe that we can fix it, if we work closely with ICBC and with stakeholders. I believe that if we do fix it, British Columbians will have their confidence restored in ICBC and its very important mandate of delivering not just high-quality insurance to the public, but also administration of driver’s licences, services cards, driver’s license testing, collection of debts for the Crown or for the family maintenance enforcement program. They do a lot of important work for the province. So we need to do….

First of all, we need to get ICBC back on firm financial footing. Secondly, we need to ensure that we’re delivering the services that British Columbians count on in making life more affordable for them through affordable insurance rates. The third thing we need to do at that stage is communicate to the public what a great benefit it is, actually, to have a public insurer like ICBC that can deliver public services that would otherwise have to be paid for out of taxes and that can deliver affordable insurance to British Columbians when it’s well-managed. We will deliver that to them.

So it’s a complicated answer to the member’s question, but it is certainly a priority for us to ensure that the public confidence is there. There are a lot of people who believe in ICBC and believe it can get back on track, if the correspondence to my office is any indication. I do believe I have the full support of senior management and the board at ICBC, as well as the employees at ICBC, who all believe that we can get ICBC back on track.

J. Yap: Has the minister had discussions with the new chair on this topic, on what he’s just discussed?

Hon. D. Eby: I can advise the member that it has been critically important to ensure that the board is on side for the changes that are going to have to take place, that senior management is on side for the changes that are going to have to take place and that, as best as possible, the employees at ICBC understand what we’re trying to do here, which is get ICBC back on track, and also that the public understands that although ICBC lost almost half a billion dollars last year, we can address this problem if we work closely with and have conversations with the stakeholders that we need to be reaching out to. So I believe that we can do these things.

Certainly, I’ve communicated very clearly to the chair of the board. I know that she has communicated to the board members the need for the board to be on side with this kind of work. I believe that they are on side for this kind of work.

[3:50 p.m.]

J. Yap: Thank you for that. The minister has appointed PWC, PricewaterhouseCoopers, to do an operational review of ICBC. Was this a direct award, or was there a competition for this award?

Hon. D. Eby: The government maintains a list of prequalified service providers for this kind of work. There was notice that was given — and if the member requires, I can get dates for him — to the prequalified firms that are on this list of the scope of work we were looking for, the terms of reference of the review. They provided their proposals back to government. The successful proponent was PWC. Two of the firms that were initially identified dropped out of the process and did not proceed with a full proposal. Three firms did.

It wasn’t ideal, in the sense that all of the firms on the list had some pre-existing relationship with ICBC or had done reviews in the past. PWC, for example, is the current financial auditor for ICBC. But that was balanced with the need to move quite quickly in terms of this review and the losses that ICBC is sustaining and the reforms that are required. So I made the decision that we should go ahead with the prequalified list, even knowing that some of them have pre-existing reports that they’d prepared for ICBC or with ICBC. PWC was selected through that tendering process.

I can advise the member that we are expecting PWC to report back early in the new year but also that I’ve advised PWC that if they identify issues that should be coming forward that will make an impact, they shouldn’t wait to prepare a laid-out, glossy report. They should tell us what needs to happen, what they’ve identified. I know I have the support of the board and the staff at ICBC in implementing those reforms as they’re identified.

J. Yap: Could the minister tell us the value of the contract with PWC?

Hon. D. Eby: The ultimate cost of the contract will be reported out once PWC has completed the work that is required. It is not a fixed-price contract.

J. Yap: Can the minister be a little more specific on the timing of the completion of the report? I believe he said early in the new year. Will this be prior to budget, prior to February, or does he expect it to be later in the year?

Hon. D. Eby: We’re expecting a preliminary report from them December 15 and a final report at the end of January.

J. Yap: The minister said that PWC is the auditor of record. Does he have concerns in regards to any potential conflict between their role as auditor and now as a reviewer? And what steps have been taken to ensure separation between the two arms of PWC that are doing this work?

Hon. D. Eby: PWC is a very large firm that provides a wide variety of services to businesses. They have their financial accounting auditing arm which is separate from their business services group. It’s an entirely different team that will be doing this review.

We’ve canvassed this issue with PWC, and they have assured us that there are firewalls between any individual that may be working on this report and anybody that’s involved in the auditing process at ICBC. They have their own reputation to look out for as well. We do not have concerns about the fact that they are both financial auditor and doing the business review.

I agree with the member. It would be ideal if there were no pre-existing relationship, but given the fact that ICBC has had eight such reviews in the last five years, it is a challenge to identify a firm that provides these kinds of services that doesn’t have some sort of pre-existing relationship with the corporation.

[3:55 p.m.]

J. Yap: As the minister said, ICBC lost half a billion dollars last year. How much is it projected to lose this year and next year?

Hon. D. Eby: This underlines the importance of the work that we’re doing. ICBC is projected to lose $364 million this fiscal year, ’17-18. For ’18-19, per the service plan, $302 million. I can advise the member that this is not an acceptable rate of loss for our government, and we will be taking steps to reduce losses and implementing them in the weeks and months and years ahead to get this under control to ensure that ICBC is not losing money at this rate. And I hope to have a much better number for ’18-19 to report to the member when we’re doing this process at that time.

J. Yap: On page 89 of the minister’s party’s election platform, it said that the NDP will stop ICBC rate increases, yet a rate increase of 6.4 percent was just announced. How does the minister explain this broken promise?

Hon. D. Eby: We’re just finding a number for the member. It will just take a second.

[4:00 p.m.]

Before the election, the public had some information about the state of ICBC’s challenges. The projection was for a 15-month period, because the previous government changed the fiscal year for ICBC to a 15-month period. For a 15-month period — basically ’16-17, plus an additional three months — the projection was minus $11 million. The actual loss for ICBC in that 15-month period was $913 million. That figure was about 90 times higher than what was available to the public before the election.

The member asks why we didn’t freeze ICBC rates. Well, I can advise the member that when you come in thinking that there’s an $11 million loss and it’s actually a $913 million loss, you’d better start acting quickly to turn the boat around.

I’m going to be blunt: 8 percent is nowhere near what it should have been. The fact is what was recommended was a 20 percent rate increase on basic to begin to get ICBC back on firm fiscal footing. That was something that our government would absolutely not tolerate. We did the 8 percent quite grudgingly, frankly, because we had no idea, and the public had no idea, about the true state of ICBC’s finances. They should have had an idea about it.

I can tell the member that the $364 million loss projected for ’17-18 is more than double what was in the service plan for the government.

Now, I think that you can make a case that accidents were increasing at a rate that the government wasn’t anticipating. You can make the case that represented claims were increasing at a rate the government wasn’t anticipating. But to be so far off, Mr. Chair, in terms of the state of a Crown corporation is difficult for me to understand.

J. Yap: I know I was asked, and I assume that the minister was asked, during the last election, but I would like to get his answer on the record here. Does the minister have any plans to bring in no-fault insurance?

[4:05 p.m.]

Hon. D. Eby: The report that was commissioned by the previous government…. One of the options that was presented was a no-fault model for British Columbia. It is not a direction that we’re going. We are not implementing no-fault in British Columbia, and I can advise the member that that remains the case.

With that said, legal expenses are driving a huge amount of the rate increases that we’re seeing, so we’re having difficult but important conversations with groups like the Trial Lawyers Association of British Columbia and others involved in the legal system — medical experts, and so on — to make sure that we’re driving down those legal costs. I am very hopeful that we will be able to make some announcements to that end very soon, because we have to. We have to get ICBC’s finances under control.

J. Yap: Will the government consider capping payouts for specific injuries?

Hon. D. Eby: Short of a no-fault system, I can certainly advise the member that we are willing to look at, really, any well-thought-out recommendations for how we can get costs down. The member is aware that the report that was commissioned by the previous government — the Ernst and Young report, as it’s known — does recommend caps on certain types of minor injuries, soft tissue injuries, pain and suffering awards.

I’ve been very clear in the media, and I will be clear with the member here, that we are looking at options like that. I can also advise the member that that is not the extent of what we’re looking at. We’re looking at the escalating rate of material damage claims, the autobody repair costs that ICBC is facing. We’re asking ICBC front-line staff if they have suggestions about areas where they’ve identified potential cost savings.

We’re running a pilot project at ICBC, where they have identified telemetric technology through a call for tenders that could potentially drive down accident costs, especially among a new driver population that might be inclined to use their cell phones, or where we could track sudden braking, acceleration and sharp turns, as some other jurisdictions have done. I look very much forward to rolling out those kinds of initiatives, in partnership with ICBC, to make our roads safer for British Columbians and help drive down costs.

There are other initiatives related to…. For example, new-model cars have increased safety mechanisms that prevent rear-end collisions through automatic braking and distance sensors, and so on. Are there opportunities for us to encourage drivers to adopt those sooner in British Columbia? I believe there are.

There are all kinds of opportunities for us, in partnership with ICBC, to drive costs down. The key to all of it, though, is recognizing, first of all, that ICBC is in financial trouble, and there’s some urgency around this. I think that’s something that was missing, for some reason, under the previous administration.

The second is the willingness to have the difficult conversations with stakeholders, whether it’s the medical experts or the lawyers, the autobody repair firms or whatever. They’re not comfortable conversations. People are comfortable with the system as it stands. But the system as it stands is not sustainable for British Columbians. They cannot continue to subsidize the system as it stands, through their auto insurance rates, because we are not going to increase rates the 20 percent or 30 percent that would be required to maintain the existing system.

Some changes will have to be made, and we will make those changes.

J. Yap: Thanks to the minister for that. I would like to harken back to the PWC report. The minister, in his answer, mentioned that there were some additional timelines. He referred to them. He’s offered to make that available to us. I would like to take him up on that, if he could, in terms of the awarding of the contract to PWC. So if he could confirm that he will provide that to us. Also, that report, when it is released in January…. I heard the minister say January — that it would be made public.

Hon. D. Eby: To the first question, yes. We’ll provide the member with that information about the tendering process for the PWC contract.

[4:10 p.m.]

For the second aspect, the intention of the PWC contract is to make it public so that people understand that we’re taking action, what we’re planning on doing and why we’re doing it. Part of the PWC terms of reference is to look at all of these previous reports that have been done, look at ICBC, make recommendations, and so on, and identify initiatives that are still relevant and should be implemented. Those are all public reports.

The member should know that when I took over responsibility for the insurer, the Ernst and Young report was on my desk. One of my first actions was to ask ICBC to make that report public, because I felt that people really needed to know the state of the insurer and the options that we were looking at. It may be that the report would have sensitive human resources information or some other information that is restricted from being released by B.C. privacy laws.

Other than that, I can’t think of any possible information that would be in that report that we wouldn’t, in fact, actively encourage the public to read and look at if they were interested in auto insurance in British Columbia.

J. Thornthwaite: I’ve got a couple of questions with regards to ICBC as well.

The first question is: what work is being done in the ministry with regards to insurance for ride-sharing?

Hon. D. Eby: I can advise the member that we’re doing policy work internally to support the Minister of Transportation’s review that has been discussed in some detail, both in and outside the Legislature. We are supporting that review process by providing information as required.

J. Thornthwaite: My other question is about the ICBC headquarters in North Vancouver. Are there any plans for the ministry to sell that building? If so, is there a schedule, and is there a cost?

Hon. D. Eby: There are no plans currently to sell the building, but I certainly wouldn’t want the member to take that to be some sort of an edict that the building would never be sold.

The issue around the sale of the building, to my mind, was that the sale of the building was identified as a way to drive down the, in my opinion again, appearance of the size of the losses at ICBC. It felt a little bit like selling the silverware to pay the bills to keep the lights on.

We need to do structural reforms at ICBC to get them back on track financially to provide low insurance rates to British Columbia. And selling the headquarters does not even come fractionally close to covering one year’s losses for ICBC.

Now, with respect to the building generally and the property, I imagine there are a huge number of people and organizations interested in the fate of that building, not the least of which would be a significant number of developers because it’s a very developable property on the North Shore. But there are all kinds of other groups. There are the employees at ICBC. There is the city itself that has a vision for the development of their city and their waterfront that may well include having people working in that area.

It is a much larger conversation. I can advise the member that in terms of the urgent matters facing ICBC, selling the headquarters, at this stage, is not the priority. The priority is getting ICBC back on track financially and in a sustainable way.

I hope that information assists her in understanding what our thinking is about that particular public asset.

J. Thornthwaite: I’m wondering if the minister could tell me where the guide-dog certification is, if it’s not in his ministry.

Hon. D. Eby: I thank the member. We’ll track that down for her.

J. Thornthwaite: So I can confirm it’s not in this ministry then?

Hon. D. Eby: I can advise the member that Public Safety and Solicitor General is responsible for that program.

[4:15 p.m.]

J. Yap: The chair of ICBC is also the chair of the Mayors Council on mobility pricing. Does the minister have any concerns with the potential for conflict between her two roles? Will there be any process put in place to manage any potential conflict?

Hon. D. Eby: We were trying to think about what the potential conflict could be. What we were thinking, though, is in fact that it’s a fairly significant benefit, both to ICBC and to the mobility commission, to have this overlap, from the perspective that ICBC potentially could be assisting the commission in understanding some of the systems related to British Columbians, Lower Mainlanders, motoring regulations, insurance, licensing, registration, and so on, and in addition, could be bringing assistance to them in understanding how ICBC may be able to help in a supporting role.

I think that, also, it will assist the mobility commission in avoiding recommending things that are unduly burdensome or difficult for ICBC to administer, given that ICBC plays such a prominent role in driver’s licence administration, vehicle insurance and registration. So it actually seems like it’s going to minimize some of the siloing that might otherwise happen.

Does the member have a specific example of a conflict in mind? I just have difficulty thinking of how it could be anything but a benefit for both of these entities to be speaking with each other through a shared board member.

J. Yap: Unlike other provinces, there’s no auto insurance statistical plan that requires ICBC to release detailed claims information publicly, so this makes it difficult to verify cost pressures facing the company or determine what other challenges ICBC may be facing.

It also makes it difficult to determine the premiums drivers pay in B.C. The Ernst and Young report stated that the average ICBC premium was $1,550 — that’s basic and optional combined — in 2016, the highest in the country. We also know that drivers paid different amounts in different regions of British Columbia. This is the preamble to my next few questions.

What is the average basic premium for a B.C. driver in the following regions: Metro Vancouver, Fraser Valley, Victoria, Vancouver Island, Interior, northern B.C. — and the provincial average?

[4:20 p.m.]

Hon. D. Eby: The member has asked a question that requires some fairly detailed preparation of a table. What ICBC will do is make some assumptions about a particular driver and then apply that across the different regions that the member has asked about. This is not a short-answer question, I’m advised, but something that requires a little bit more work. They will be undertaking that work, and I can tell the member that we’ll provide it to him when I receive that.

J. Yap: With that, I do have a number of additional questions along the same vein. I will read them out, and perhaps management at ICBC can take these questions away and also prepare a response, all together.

My next question is: what is the average optional premium for a B.C. driver in those same regions? That’s Metro Vancouver, Fraser Valley, Victoria, Vancouver Island, the Interior, northern B.C. and provincial average.

Next question: what is the average cost of an injury claim for a B.C. driver in those same regions — Metro Vancouver, Fraser Valley, Victoria, Vancouver Island, the Interior, northern B.C. — and provincial average?

Hon. D. Eby: Just a clarification from the member, if it’s possible. The average injury cost has nothing to do with where a person is driving. It has to do with the type of injury the person has sustained. Can he clarify a little bit what he’s looking for in that question so that we can make sure that it’s reflected in the information we provide him?

J. Yap: I understand what the minister and ICBC management are getting at. If this is available on a regional basis, I would be interested in seeing if there are any regional differences. I do understand it depends on, clearly, the severity of an accident.

[N. Simons in the chair.]

Hon. D. Eby: I can advise the member that ICBC is happy to sit down with the member to go through with him what information is available and to, as best as possible, try to provide the information that he’s seeking. There are some nuances around loss costs by region that they’d like to…. It’s probably easier to sit down and go over with the member than to try to do it through this process. I’m glad to facilitate that process through my office if the member’s interested.

[4:25 p.m.]

The Chair: Member.

J. Yap: Thank you and welcome to the Chair, Powell River–Sunshine Coast.

How many basic policies were written by ICBC in 2016?

Hon. D. Eby: It was 3.3 million.

J. Yap: How many optional policies were written by ICBC for the same year?

Hon. D. Eby: Three million optional policies. ICBC owns about 90 percent of the optional business in British Columbia.

J. Yap: How many basic luxury vehicle policies were written by ICBC in 2016?

Hon. D. Eby: There were approximately 3,000 basic luxury insurance policies written. This is for vehicles $150,000 plus. There’s also an optional category for luxury vehicles. A similar number of policies were written on the optional side as well, although, just for the member, there is a slightly different definition of “luxury vehicle” on the optional side from the basic side.

J. Yap: I thank the minister for that answer. He anticipated my next question. So my next, next question is: what is the average cost of a luxury vehicle policy in B.C. today?

Hon. D. Eby: This is one of those categories where we’re going to have to get back to the member on that.

J. Yap: What is the average cost of an injury claim for a luxury vehicle driver?

Hon. D. Eby: It’s the same issue. We’ll have to get that information to the member.

J. Yap: I look forward to receiving that information. My next question: did ICBC lose money insuring its luxury vehicle segment in 2016. If so, how much?

[4:30 p.m.]

Hon. D. Eby: I just want to be clear about this. ICBC doesn’t ose money in relation to providing insurance to luxury vehicle drivers in relation to luxury vehicle drivers’ at-fault accidents. The concern around luxury vehicles centres on someone driving a Toyota who runs into a Ferrari. As someone who drives a Toyota, it’s something in Vancouver that I live in fear of, so no distracted driving.

On the basic side, in terms of a Ferrari owner buying a basic policy in aggregate over the entire luxury vehicle class, ICBC makes money on the luxury vehicle class in terms of their at-fault accidents.

J. Yap: The minimum capital test, or MCT, is best practice in the property and casualty insurance industry as established by the Office of the Superintendent of Financial Institutions, or OSFI, to measure the capital adequacy of an insurer to protect policyholders from financial risk and to provide long-term stability. It measures capital available to capital required for risks facing the company.

While ICBC is not federally regulated by OSFI, special direction IC2 requires ICBC to have a minimum of 100 percent MCT ratio for basic insurance. In addition to this legislative minimum, the BCUC has approved a regulatory target of 145 percent for basic insurance to reflect the risk profile of the basic insurance product and to promote relatively stable and predictable rates — rate smoothing. Private insurers typically have MCTs above 200 percent.

My question to the minister is this. The September update to ICBC’s annual service plan no longer projects its three-year MCT. What is ICBC’s projection of its basic and optional MCTs over the next three years?

[4:35 p.m.]

Hon. D. Eby: I can advise the member that it’s 105 percent on the basic and 73 percent corporate. The MCT on optional is generally not released by ICBC because of business competition issues. ICBC competes with private sector insurers for the optional side.

I can advise the member that one of the reasons why these numbers are so low is that government took money out of the reserves in order to transfer the money from ICBC’s reserves into general revenue in order to bolster their budget — the previous administration. That amounted to $1.1 billion taken out of ICBC’s reserves. Those numbers would be much higher had government left that money in ICBC, but instead, they took it out of ICBC and put it into general revenue of the budget to make it look better than it was. Now that ICBC desperately needs those reserves, in a difficult time, the money is not there.

I know my colleague the minister responsible for B.C. Hydro has seen similar issues in the deferral accounts at that Crown corporation. This is not a unique issue to ICBC, and it is one that is very troubling to me and certainly to British Columbians who wish that that money were there now to assist the insurer with mitigating some of the rate pressures that we’re seeing now, given the position that ICBC is in.

In addition to not meeting the MCT test, which is a technical thing that people might not immediately wrap their heads around, they certainly understand that the income from that $1.1 billion that was taken out of ICBC in terms of investment income was money that was also used to offset losses and reduce losses at the insurer that’s no longer available either.

I appreciate the member’s question about the MCT, but I open up this file, and I certainly wonder myself about why the previous administration took $1.1 billion out of ICBC’s coffers and put the MCT into the position we find it in today in terms of the ratio that should be there.

J. Yap: On September 5, the government directed ICBC to transfer $470 million from ICBC’s optional to its basic business line. What is the current value of ICBC’s optional reserves remaining after this transfer?

Hon. D. Eby: I can advise the member that for business competitive reasons, ICBC does not disclose that, but it suffices, I think, to say that, generally speaking, in terms of ICBC’s capital reserves, they are not where they should be, and I wish that they were. But decisions made by the previous administration have really limited our options here in terms of the future availability of ways to deal with the financial crisis that is currently gripping ICBC.

We will make those changes that are necessary to get ICBC back on firm financial footing, but the cupboard is bare as far as further transfers. We cannot rely on this to deal with the crisis that we’re facing in terms of a go-forward basis.

So it’s quite a difficult situation, and I think the member is putting his finger on it. I welcome his support when we bring forward the reforms that are necessary to get ICBC back on track.

J. Yap: The 2017 rate application also showed that without its optional transfer, ICBC’s basic MCT would have been just 69 percent, quite below the minimum required. With the transfer, the MCT is 101 percent, just 1 percent above the minimum required.

The question is: what measures will ICBC be taking to prevent its MCT from falling below the required minimum next year?

Hon. D. Eby: It’s been explained to me that in order to show up at the Utilities Commission for a rate hearing, you have to be at 100 percent MCT for your basic insurance. It’s kind of like the ticket to get in. I can advise the member that, happily — although it’s a heavily caveated happily — the MCT for basic is at 105 percent currently.

[4:40 p.m.]

He raises an important question. What do we do next time if basic isn’t in a position to be there? Well, the answer is pretty obvious. Frankly, we’re going to have to either dramatically increase rates, or we’re going to have to transfer money out of services available for British Columbians to keep the insurer afloat.

Neither of these are acceptable options for our government. So we’re preparing to make, and we have made already, changes to get ICBC back on financial track. We cannot sustain the continued situation. Drivers will not put up with double-digit rate increases. British Columbians generally will not accept money for schools and hospitals going to prop up the insurer. So we have to make these changes.

They’re difficult changes. They’ve been put off for too long. We will make those changes, and I hope to have a very different conversation with the member a year from now in terms of where the insurer is headed in its financial stability.

J. Yap: Does the minister anticipate that he will again direct ICBC to transfer optional capital to basic?

Hon. D. Eby: We are looking at very dramatic reforms to ICBC to get them back on financial track. It’s difficult at this stage to project exactly what state the insurer will be in a year from now. We expect it will be in a much better financial state and on the right track, getting back into the black.

I’m not going to speculate about where the capital ratios might be at that stage, but I can tell the member that it is certainly a very grave concern for me, for our government — the state of the insurer — and we will be getting it back on track.

J. Yap: ICBC has underestimated its combined ratio every year since 2013, understating its losses and leading to higher rate increases than originally forecast. What measures is government taking to mitigate a financial impact should ICBC’s forecast again prove inaccurate? ICBC’s combined ratio for 2016-17 was 128 percent but drops to 116 percent for the period ’17-18 to ’19-20.

Hon. D. Eby: I think it’s safe to say that ICBC is under unprecedented scrutiny right now, both at the Utilities Commission, in terms of the interest of the public and the media, and in terms of the interest of our government to get it back on track.

I think it is, maybe I’ll just say, unfair to suggest the fact that the government was off by about 90 times in terms of ICBC’s loss. Government commissioned a report for ICBC before the election about options available to address what it knew was a crisis at the insurer, yet for some reason, that information wasn’t available to the public before the election. So it’s a bit much for me to hear that somehow this was all ICBC and that government didn’t know, that it was just that ICBC misunderstood what their financial situation was, when the government actually commissioned a report to deal with a crisis that they knew was happening, and they just forgot to tell the public about it.

We are working closely with ICBC. I have confidence in their ability to provide me with the information that government needs to make the decisions that we have to make in terms of ensuring that it’s back on firm financial footing. I can advise the member that ICBC knows, the senior management knows, the board knows, the staff knows and the B.C. public knows — and if they don’t know, I want them to know — that we will be taking the steps to get ICBC back on firm financial footing.

We are not trying to fool the public about the very serious state that ICBC is in. Losing almost $500 million in a single fiscal year is a big, big problem. We have other intentions for the future of ICBC than continuing to lose money at that rate. That includes providing affordable insurance to British Columbians and providing good services to British Columbians, like they had in the past. We’ll get them back on track.

J. Yap: A 2012 review of ICBC found significant growth of ICBC’s management and recommended reductions. To the minister: how many vice-presidents or vice-president-equivalent positions exist at ICBC today? How does that compare to similar-in-scale insurance companies elsewhere?

[4:45 p.m.]

Hon. D. Eby: I can advise the member that with the CEO, it’s a total of eight. There’s the CEO and seven vice-presidents. I can also advise the member that the 2012 decimation of staff at ICBC, in my opinion, is one of the reasons why the insurer is in such difficult financial straits today.

The representation rate for people who bring forward claims to ICBC being represented by counsel continues to escalate — the reason why, I believe, more and more people have turned to counsel to represent them, which drives costs up for the insurer generally without any apparent benefit to the public generally. Although it’s certainly a benefit, in some cases, to the individual coming forward.

The reason for this was that they would try to get their matters resolved at ICBC, and ICBC was so reduced by the staff reductions that they couldn’t get their matter resolved, even if they had a claim. Even if they’d paid their insurance, had a valid claim and wanted to get it resolved, the cuts to ICBC, following the 2012 report, decimated the insurer and made it so that people had to hire lawyers, or felt they had to hire lawyers, to get their claims resolved.

We will not be taking such a simplistic approach to the insurer. One of the things that we want the insurer to do and we want the public to know is that when they are in an accident and they call up their public insurer, which is owned by all of us, they will be supported through this process. They will have the staff support that they need to make sure that they don’t actually have to go and hire a lawyer, because they can get their claim resolved quickly and expeditiously and fairly by ICBC.

It was those staff cuts that were a big issue in my opinion. I’m sure that others have different perspectives. But in any event, I think it’s critically important that British Columbians, when they’re in an accident, when they call ICBC, can get a fair resolution of their dispute without having to hire a lawyer. That has to happen in order for us to get costs under control, that British Columbians get good service every time from ICBC.

I know ICBC senior management understand that. We’ve been working closely in terms of ensuring that British Columbians are getting the kind of service that they need from ICBC. I look forward to continuing improvements on the staffing front in order to ensure that British Columbians get that support that they need.

J. Yap: How many senior managers, director level or above, exist at ICBC today?

Hon. D. Eby: There are 43, director levels and above.

J. Yap: How many managers are there at ICBC today?

Hon. D. Eby: I can advise the member that there are 940 what are called management confidential staff. These are not all managers, but they are excluded staff. They’re not part of the union. Then there are 4,840 staff that are part of the front-line unionized staff — just to try to anticipate the member’s next question.

J. Yap: How many staff earn more than $75,000, more than $150,000 and more than $250,000? How has this changed in the last two years?

[4:50 p.m.]

Hon. D. Eby: There are ten people making $250,000 or more. Those individuals are all part of a summary compensation table that’s publicly available under executive compensation disclosure. They’re available by name and title, if the member wants additional information on that.

For the 12-month period 2015 to 2016, people earning more than $150,000 — in 2015 there were 74 of these individuals. In 2016, there were 47 of these individuals, so 30 fewer. In the 12-month period 2015 versus 2016, for people making $75,000 or more, there were 1,346 individuals in 2015 and 1,401 individuals in 2016, which is an increase of about 50 people.

I just want to flag for the member that those ten individuals include some severance payments for some individuals who received more than $250,000 in that year because of severance.

J. Yap: How many claims employees does ICBC have?

Hon. D. Eby: It’s 2,275.

J. Yap: How has this changed over the last two years? I’m interested in this recruiting drive that had a goal of 340. Was that achieved?

[4:55 p.m.]

Hon. D. Eby: There are two numbers I’m going to give the member. For front-line staff at ICBC, in 2015, there were 1,931. In ’16-17, that went to 2,044 front-line staff. Then for claims staff, which the member asked about, for 2014, there were 2,230 claims staff, and in 2016-17, 2,275 claims staff.

J. Yap: My last question before I hand it to my colleague from Chilliwack-Kent, who has a specific question, is this: does the minister expect the number of FTEs at ICBC to increase or decrease over the next two years?

Hon. D. Eby: With increasing claims and an increasing number of accidents, ICBC anticipates adding claims staff, claims adjusters, to deal with the growing caseload of increased accidents. I also want to note the review that is taking place. I don’t want to prejudge any recommendations that may come forward in terms of initiatives that might be recommended about improving outcomes at ICBC, which may include adding staff. I don’t know what PwC will identify in their process.

With that caveat, I can tell the member that aside from claims to deal with the growing accident load, there are not additional hires expected currently.

L. Throness: I hope the minister won’t mind if I have one single, specific question from the riding. It’s about ICBC and, specifically, about windshield replacement. Apparently, we in B.C. are paying at least twice as much as Alberta to get a simple windshield replaced. The same procedure is done in both provinces. The windshield glass is purchased from the same manufacturer. But including the deductible, a new windshield in B.C. will cost at least $550, which is more than double what it is in Alberta.

I’m wondering if the minister could enlighten us as to the reasons for that overage.

Hon. D. Eby: I’m glad to hear the member raising concerns about growing material damage costs. It’s one of the cost drivers for ICBC — not just windshields but autobody repair, generally. It’s my opinion that the previous administration failed to have important conversations with representatives in the material damage industry to ensure that costs were contained and kept under control. But that’s just my opinion, and hey, I’m not an expert in these kinds of things.

A couple of steps have been taken. One is that I’ve asked representatives of those industries to come forward with recommendations that they have about cost savings. How can we work together to drive down material damage claims — whether they’re windshields or other autobody repair pieces. The other is that I’ve specifically asked — and ICBC has supported this — the PricewaterhouseCoopers review to look at material damage claims and find and identify any issues for us to resolve.

I hope very much that we can hear some recommendations from them when they complete this review about this. I know there are some passionately held views within the industry about what needs to happen. I know that there are certainly many people in the broader community who have had experience with autobody repair who are writing to my office and saying they believe that something needs to be done about autobody repair costs.

There are competing views about what the state of the industry is, what the state of costs are, and we do expect to get to the bottom of it and address it. But at the end of the day, we need to get the costs down for British Columbians, so we’re hoping for the cooperation of industry, and certainly, we’re expecting the support of ICBC in identifying opportunities around material damage claims.

I thank the member for his suggestion, and I encourage him to bring forward additional suggestions that he may have about where ICBC costs may be reduced and where we could pass those cost savings on to drivers in British Columbia.

L. Throness: One suggestion for the minister that could be a factor. ICBC follows the National Auto Glass Specifications pricing calculator, which may have something to do with the high price of glass. Perhaps he could consider that in his review.

J. Yap: I want to thank the minister and the ICBC representatives for this phase of the estimates debate. I would suggest to the Chair a five-minute recess.

The Chair: This committee stands in recess for five minutes.

The committee recessed from 5 p.m. to 5:06 p.m.

[S. Chandra Herbert in the chair.]

The Chair: All right, Members. I’ll call this committee back into session. I believe I see the member for Richmond-Steveston waiting with a question.

J. Yap: Thank you, Chair. Welcome back.

Let’s go straight to the money-laundering review. The terms of reference say that the review should not have to wait to the end before bringing recommendations forward. The question to the minister: can he advise if there have been any recommendations so far, and if so, will he make them public as soon as he has them?

Hon. D. Eby: I’ll take a second and introduce the staff behind me here. We’ve got Jim Lightbody, the president and CEO of B.C. Lottery Corporation, and Amanda Hobson, the CFO and VP, finance and corporate services, B.C. Lottery Corporation. To my right is John Mazure, ADM and general manager, gaming policy and enforcement branch. And I noticed Anna Fitzgerald, the executive director, compliance, and Len Meilleur, strategic advisor, wander up from the gallery when the member raised the question.

There are a number of other representatives of gaming policy and enforcement branch who are here, who I will introduce if or when they come up to assist me.

I can advise the member that there was a very obvious reason for that direction to Mr. German that he bring forward recommendations as soon as he identifies them. It’s that the allegations are serious that are appearing in the media. There are concerns among the public about this, and we need to act quickly to address it.

I can advise the member that I haven’t had any recommendations for policy reform currently from Mr. German, but as soon as I do, I will be putting those policy reforms into place to ensure that the public can continue to have confidence in the administration of gaming in the province.

They will be public because they will require some sort of order-in-council or legislative reform or other change. We also obviously — or maybe not obviously…. In my opinion, we want to communicate to the public what we’re doing to address these issues, so this is not a secret process. This will be a process that is meant to address the issue and to ensure that the public knows that we’re moving to address any issue that’s identified by Mr. German.

J. Yap: I’m glad the minister advises this is not a secret process. In that light, will he commit to releasing the report publicly in March of 2018?

Hon. D. Eby: Subject to any restrictions around the Freedom of Information Act, whether it’s human resources information or information that might affect law enforcement or business sensitive information — absolutely.

I think the member should know that when I took over the file, I immediately released a report that was available to the previous administration but hadn’t been publicly released and that raised some serious questions and made some serious recommendations for reform. It is not my practice, and it will not be my practice, to prevent the public from knowing what’s being recommended about gaming in the province and how we can be improving it and ensuring that people can have confidence in it.

[5:10 p.m.]

J. Yap: I’m glad to hear the minister is committed to transparency. How much taxpayer dollars will be spent on this money-laundering investigation?

Hon. D. Eby: I can advise the member that when the review is complete, Mr. German’s billings will be made public in the regular course. The question really depends on us knowing the extent of any issues that Mr. German identifies.

The terms of reference are pretty clear. We want him to address the issue, but we don’t know, in fact — the terms of reference set out — if this is something that is just part of gaming. I suspect not, strongly. But we’re not prejudging anything in terms of Mr. German’s review. The extent of the issue, the length of time that he has to spend reviewing documents or interviewing individuals to get to the bottom of the issue — all of that is going to go into what the ultimate cost of this review is to the public.

I can certainly advise the member that it is money well invested in ensuring that the public can have confidence in our gaming system in British Columbia. Mr. German is a lawyer, a former deputy of the RCMP. He has literally written the book on money-laundering law in Canada. He is an expert in law and policy around money laundering and recognized internationally for that work. So I can’t think of a better person to be doing this work for the province.

J. Yap: I agree with the minister. Mr. German is highly respected, and I know of his good work.

Will there be any government FTEs supporting Mr. German’s review, and if so, how many?

Hon. D. Eby: I can tell the member that there is an individual, Jerome Malysh. He’s a former RCMP member who is assisting Mr. German and has assisted Mr. German in other activities of a similar nature — money-laundering investigations, and so on. So that is someone who has been retained by Mr. German to assist him in this process.

Within the B.C. Lottery Corporation and the gaming policy enforcement branch, there’s no one staff member that has been appointed to be a full-time liaison with respect to Mr. German’s work. Staff are seconded to assist as required, to provide information, records or whatever is required for Mr. German to complete his work. I understand and rely on the full support of the B.C. Lottery Corporation and the gaming policy enforcement branch in this review, and I’m grateful for it.

J. Yap: Has the minister received any briefings from RCMP or any other law enforcement bodies with respect to money laundering, and if so, did they express any concern about possible interference with ongoing investigations as a result of this investigation?

Hon. D. Eby: I have had briefings from law enforcement organizations. The briefings are confidential, with good reason. To the extent that information can be released, it has been released by my office through the freedom-of-information process and through proactive disclosure to the public. We will continue to do so.

I think, though, as far as a concern about interference with an RCMP or a municipal police investigation, that is not a concern that has been raised, to my knowledge, certainly, with me directly, or to my knowledge with any member of either BCLC, GPEB or anybody else with respect to the Ministry of Attorney General.

J. Yap: Has the minister instructed BCLC to step up training casino employees with regard to best practices around suspicious large-cash transactions?

[5:15 p.m.]

Hon. D. Eby: In the last FINTRAC review and audit of anti-money-laundering processes within B.C. Gaming, there was a recommendation for improvement in training of staff.

I have worked with both the B.C. Lottery Corporation and the gaming policy enforcement branch to identify current compliances with service providers around training for staff, around what training staff receive around this FINTRAC recommendation.

I know that BCLC and the gaming enforcement branch both take that recommendation seriously, and BCLC has implemented processes to ensure that training is adequate in response to the recommendations from FINTRAC.

P. Milobar: I hope the Attorney will find these next two questions of a fairly softball variety but not so much so that he confuses me with a member of the third party.

I’m just wondering if the minister can confirm…. Coming from Kamloops, B.C., obviously we’re very proud of the headquarters in Kamloops and very proud of the community work that they do — the outreach, the mentorship to the tech community and, obviously, a large employer in Kamloops as well. Can the Attorney confirm that the BCLC long-talked about and planned new headquarters rebuild and headquarters in Kamloops is still a go?

Hon. D. Eby: The B.C. Lottery Corporation is currently in an RFP process around the headquarters. There are four firms participating. RFPs are due back in February of 2018. The options that have been put forward for the RFP are renovate the existing site; build new; and build new and lease back; build new, sell and lease back for B.C. Lottery Corporation.

The B.C. Lottery Corporation will be collecting all of those responses to the RFP process and putting forward a proposal to government for funding of the headquarters. That process, I can assure the member, is ongoing.

I wanted to take a moment to thank, certainly, all the employees of B.C. Lottery Corporation in Kamloops who work so hard on behalf of the public. I wanted to thank them for their work and let them know that the process continues with respect to the headquarters RFP and, ultimately, a proposal to government for either renovation or new-build headquarters for BCLC in Kamloops.

P. Milobar: Can the Attorney also confirm that at a minimum, the project is at the same scope, the same scale, the same timeline as the previous pre-election planning was happening within BCLC? And given that the RFPs are out currently, are they going to be subject to best bid, or are they under the wire and will be under the old rules of RFP?

Hon. D. Eby: I can advise the member that the standard RFP process is being followed. It was set out in the RFP, and that’s what will be followed.

[5:20 p.m.]

With respect to the scope of project, what the building would look like or what components are included or so on, there’s no change. There was a brief pause, given the process between the election date and election results and the new government being sworn in, but aside from that, there’s been no change to the scope of this project at all.

J. Yap: Does the minister have any plans for structural organizational change at BCLC?

Hon. D. Eby: I’ve been on the file for just over 100 days. I can advise the member that I don’t have an idea about going in and restructuring this Crown. What I can advise, though, is that it’s certainly open to Mr. German to make recommendations to us around, for example, how anti-money-laundering processes are undertaken, who has responsibility for what, who is bottom-lining what — those kinds of changes.

Actually, if the member would just give me one second. There’s one thing that occurs to me that I just want to check before I finish this answer. You know what? It’s only been 100 days, so I should probably turn around and ask the people behind me to make sure before I say with certainty that no changes are going on.

Yes, there are no structural changes at this stage that are in the budget.

J. Yap: How many FTEs are now employed at BCLC?

Hon. D. Eby: As of March 31, 855.

J. Yap: Does the minister expect this to change over the next two years?

Hon. D. Eby: Yes. There are some increases expected at B.C. Lottery Corporation. There is a lottery terminal renewal process that will be undertaken, for example, that will require additional employee assistance. It’s not out of the question that Mr. German might recommend additional staff at BCLC, related to the anti-money-laundering program.

The B.C. Lottery Corporation continues to be successful in bringing in revenue for public programs, and their initiatives around this lead to increased need for various services that are provided to service providers in the province as well as administration of lottery and so on. I do expect the number to increase but not dramatically, just related to individual projects — like, for example, the lottery terminal replacement project.

J. Yap: Can the minister tell the committee how many FTEs earn more than $100,000 per annum?

[5:25 p.m.]

Hon. D. Eby: So 173 B.C. Lottery Corporation employees earned more than $100,000.

J. Yap: Does the minister expect this to change over the next couple of years?

Hon. D. Eby: No.

J. Yap: How much does BCLC spend on responsible gambling initiatives?

Hon. D. Eby: In 2016-17, B.C. Lottery Corporation spent $3.4 million for responsible and problem gambling.

J. Yap: How many FTEs at BCLC are involved with this program?

Hon. D. Eby: We’re going to have to get back to the member on that. We don’t have that number here today.

J. Yap: I appreciate that. With respect to that number, does the minister expect this to change over the next two years?

Hon. D. Eby: I thank the member for his question. I think the province has a great responsibility around ensuring that people who are having challenges with addiction related to gaming are appropriately intercepted and treated, that they have that available to them.

I’m very proud to advise the member that we have a minister responsible for mental health and addictions in the province, and I look forward to working with her to ensure that the systems and processes in place for people suffering from gaming addiction are receiving the services that they require. I think the member should absolutely expect that we’ll be providing additional resources to people in that situation.

J. Yap: I realize the administration of gaming grants is outside the Attorney General’s mandate, but does he have any plans to change the funding available or to alter the administrative arrangement with regard to gaming grants?

Hon. D. Eby: The member is right. That’s a Municipal Affairs and Housing responsibility.

S. Bond: We’re going to, I hope…. I apologize if this is going to take us on a detour. We’re not going to be talking about liquor or gaming for a couple of minutes. I want to spend a couple of minutes talking to the Attorney about specialized courts. I’m hopeful that whoever’s…. I don’t know if the appropriate people are here. There has been a significant evolution of specialized courts in British Columbia. In fact, there are First Nations courts, domestic violence courts, downtown community courts.

One of the strategies that the previous government looked at was a specialized courts strategy. It was, I think, written or at least compiled in 2016. At that time, there was an agreement to develop, consult and work with the judiciary and other partners, mainly to look at an evidence-based approach to specialized courts. I’m wondering if the Attorney could update us on the status of the work that’s being done on specialized courts.

[5:30 p.m.]

Hon. D. Eby: I thank the member for the question. The specialized courts strategy that the previous government released in March 2016 included three parts — governance model, needs assessment and business case requirements — and an assessment framework in order to determine if courts were achieving their intended objectives.

I can advise the member, from my own perspective, that in terms of the courts and their intended objectives, whether it was someone dealing with an addiction to drugs or somebody who was in the downtown community court because they had issues with homelessness, the services that were intended to be available, frankly, I think, should have been more available, and this affected the success of the courts. So I share her concern about making sure that these courts are effective.

I can advise the member that as far as new specialized courts, I had the privilege…. I don’t mean to be unduly critical of the previous government’s work on this, because there were some very good things that were done by the previous government. One of them is the First Nations courts that were developed in partnership with the Chief Judge of the Provincial Court. I had the privilege of being at the opening of the court in Merritt. It was a great celebration for the community. It was based on the success of the First Nations court in Kamloops, another successful First Nations court model.

I want to congratulate those who were involved in the implementation of those courts, because they’re serving as a model for what I think should be. What I’m supporting, and what our government is supporting, is the implementation of additional First Nations courts across the province. I know that needs assessment and business case requirements are developed for those additional courts. I know that there is an assessment framework that’s engaged in by the chief judge.

There’s a committee of the Deputy Attorney General and the criminal justice branch that participate in the oversight, with the chief judge, of these courts to ensure that they’re achieving their intended goals. More than that, there is accountability to the First Nations community that is taking ownership of these courts.

I can advise the member that really, under this government, it is very closely entwined with my mandate letter and with the commitment in all of our mandate letters in relation with the U.N. declaration on the rights of Indigenous peoples and our commitment to Indigenous people in this province to work in partnership with them on overrepresentation in the court system generally.

I can advise the member that to that end, we’ve allocated $400,000 in capacity funding to the Aboriginal Justice Council so they can work with us in advising us on what is working and what is not working for their community, for the Indigenous community in British Columbia, in relation to the justice system, specialized courts and regular courts in the province. That work is underway.

[5:35 p.m.]

I can advise the member, as well, that additional initiatives will be coming forward in relation to that particular community and that mandate letter commitment.

S. Bond: I’d like to thank the minister for his comments. Certainly, none of us would disagree that there needs to be an outcomes-based approach. When the downtown community court was reviewed, one of the things that it did demonstrate was that there was reduced recidivism for at least a small group of the clients, not necessarily all of them. So I think there is a great deal of merit in looking at a system that better serves the needs of both the communities — the judiciary but also the clients themselves.

As a follow-up to the minister: will there be ongoing review? Will there be a public reporting out of the outcomes? Then I’ll have a follow-up after that. Will the work continue as we evaluate the effectiveness of these specialized courts that we have today? Will there be a public reporting out of those findings?

Hon. D. Eby: Of interest to the member may be an initiative, proposed out in Surrey, around an integrated services network, which is very much like a community court approach, except without the court. The idea is that you’re kind of trying to identify people before they actually end up in court, provide those wraparound services that are going to assist people in avoiding the criminal justice system generally and otherwise address issues of mental health, addiction and so on that can lead to public disorder and other problems that are identified.

That project is based in part on the outcomes of the community court and trying to figure out if there isn’t a better way of achieving the aims of the community court, perhaps outside of the court setting. Some of those findings from the initial research process are informing the Surrey approach to this exact same issue.

The member should be advised — I know she’s a former Attorney General herself — that nothing has changed in the new government in terms of ensuring that projects that are undertaken have a rigorous set of metrics associated with them so that we can determine whether the project is succeeding or not, in terms of the outcomes that we were hoping for and ensuring that tax dollars are spent wisely.

I welcome the member’s comments about the community court, because I’ve certainly had questions about it before I came into my current role. I look forward to, hopefully, providing the member with more information should this initiative in Surrey get some legs and some success in trying to tackle the same problem — except, this time, just outside of the court system.

S. Bond: I appreciate the minister’s summary. I think the process that was engaged with Surrey, in the Surrey model, was after the assessment. They started out wanting to have a community court. At the end of the day, when they looked at the kinds of services that were available and the best way to approach it from Surrey’s perspective, they decided to use an integrated service model instead of a community court.

I don’t think that that minimizes the need for us to continue to look at whether or not First Nations courts or specialized courts have a role to play in other parts of British Columbia. While I’m interested in the outcomes of the work that was done in Surrey, what I’m more interested in is the potential of a community court or a First Nations court in my region of the province.

I’m sure the minister is well aware of the demographics of the region that I live in. Like in other parts of the province, First Nations people in particular certainly are a significant part of our demographic. So a group of organizations came to government with a proposal at least to look, or the beginnings of having a look, at a specialized court in Prince George, based on demographic need, on some of the circumstances that exist there.

Today I would like to ask for some assurance that the commitment that was made at that time, not just by the minister but by the Attorney General’s ministry — that proposal or some process — would be put in place to do a legitimate assessment as to whether or not there is a need.

[5:40 p.m.]

There’s certainly a desire for a specialized court in the region of the province that I live in. Now the question becomes: how do we move that proposal ahead?

Hon. D. Eby: I’m certainly glad to hear any proposal that members bring forward from the communities that they represent around improving our justice system. I’m not familiar with the proposal or the initiative or the announcement that the member is talking about in relation to Prince George. It certainly doesn’t foreclose the possibility of working with the member on that kind of initiative.

I can advise that as far as First Nations courts go, generally the process has been that a First Nations community comes forward that wants to take ownership of that court, that has elders that are interested and willing to engage in supporting the process. The community is interested in engaging and supporting that process. They work with the chief judge very closely to develop that process, and our government supports them in that.

We also have the Aboriginal Justice Council that is advising us on approaches in addressing the concerns of the community that they represent — leaders from across the province advising us on the priorities of their communities. So that is also helpful to us.

It’s not totally clear to me from the member’s question whether we’re talking about a First Nations court or whether we’re talking about more on the line of like the Surrey integrated services or the downtown community court type of model. But in any event, it doesn’t really matter. Either way, I would be glad to work with the member in identifying exactly what the proposal is or was, and trying to find a way to make our justice system better in the area of Prince George.

S. Bond: I’ll just end my comments. I know that my colleague has been very gracious, ceding some time for my questions. I want to thank the minister for his willingness to look at this. I would ask that the ministry bring back the work that was presented. It was presented by First Nations courtworkers and a variety of other organizations in the community. So the minister’s point about First Nations leading the file is well taken. Certainly that was and is the case.

I would simply ask that over the course of looking at the issue of specialized courts, understanding that we do need to have them based on outcomes…. Certainly, community courts have demonstrated that there has been some success, perhaps not as much as we would have hoped, and there is an intensive investment of resources. But I appreciate the minister’s willingness to look at that file.

I would just ask that at some point in the not too distant future, I would be given the opportunity to be updated on the request that was made directly by that group of organizations to the previous minister. So I thank the minister for his time this afternoon.

Hon. D. Eby: I thank the member for bringing that proposal forward. Sometimes there are issues with a new minister coming in and getting access to old work that was done before. We have a public service that is very committed to principles around confidentiality related to previous administrations and so on.

So I hope I can rely on the member as needed to reconstruct as best as possible, or, in the alternative, to get consent from the House Leader of the official opposition if, in fact, there is some sort of confidentiality concern that we have to address in order to access that proposal.

J. Yap: I would like to canvass a few more questions on Lottery Corp, and then we’ll move to liquor.

Back to money laundering. The laundering of drug money through casinos is, of course, a major concern. According to some news reports, a lot of cash bills are ending up in cashier’s cages and being tested positive for drugs of abuse, including the highly toxic compounds fentanyl and carfentanil.

Is the minister aware of any concerns from workers at our casinos or WorkSafe about possible health effects for casino employees related to the handling of this cash?

[5:45 p.m.]

Hon. D. Eby: There are so many different aspects of the fentanyl crisis in our province, the overdoses and the deaths — the mounting hundreds of deaths in our province.

Worker safety is certainly a priority for our government. With that in mind, I can advise the member that we’re not aware of any specific incidents involving complaints to WorkSafe B.C. or a worker being poisoned by something that’s on money that’s coming into the casino somehow. Certainly, if there were, we would involve law enforcement, and we’d involve WorkSafe B.C. I think, actually, given the toxicity of some of these drugs — cash-based businesses, generally — this is a potential concern.

Where the real manifestation, though, of this crisis is, is obviously in the people who are using illicit drugs and who are dying in large numbers. To that end, I can assure the member that our Minister for Mental Health and Addictions is very engaged on this issue and is working very hard to address it. In addition, I can advise the member that Crown counsel, who are facing these kinds of cases, take them very seriously. I know that the Minister of Public Safety is also very engaged, as well, from a policing side, with regular updates from police on an issue that’s related to fentanyl.

It is a whole-government approach mandated by the Premier, who is quite engaged with the crisis that we’re facing. I thank the member for his question about worker safety.

J. Yap: The minister’s election platform promised to negotiate with First Nations leadership and communities about expanding opportunities for their share of B.C.’s gaming industry. Has the minister directed BCLC to undertake these discussions, or is that something that the minister’s office is engaging in directly?

Hon. D. Eby: The Ministry of Indigenous Relations and Reconciliation — my colleague the minister is leading that process. It’s not happening out of B.C. Lottery Corporation or gaming policy and enforcement branch. It’s happening through the ministry, that negotiation process.

J. Yap: Does the minister expect to see an increase in gaming in British Columbia in the next, say, three years?

Hon. D. Eby: Pardon me, Mr. Chair. I was briefly distracted while the member was asking the question, because there was some information that I didn’t give the member about his last question.

The gaming policy and enforcement branch is, in fact, supporting the Ministry of Indigenous Relations and Reconciliation in that process, but it is being led through that ministry. I just want to be clear that they’re involved in that.

If the member could repeat his question.

J. Yap: The question is: does the minister expect to see an increase in gaming in British Columbia in the next three years?

Hon. D. Eby: The service plan does call for an increase in revenue as a result of improving customer experiences in all three lines of B.C. Lottery Corporation business. What I can tell the member, though, is that will be balanced with two things. One is ensuring that our government is fulfilling responsibility around people that have addiction issues related to gaming and the public health aspect. The second is ensuring that the public can continue to have confidence and that where that confidence has been lost, it will be restored — that any issues of criminality associated with gaming in B.C. are dealt with quickly and effectively.

J. Yap: I realize the minister has advised that Minister of Indigenous Relations and Reconciliation is leading the work on expansion with First Nations, but can the minister advise if there are any First Nations communities in particular that are targeted for gaming expansion?

[5:50 p.m.]

Hon. D. Eby: Generally speaking, it’s B.C. Lottery Corporation’s responsibility to determine where casinos will be placed or whether they’ll be expanded and so on, in consultation with local governments and First Nations.

I can advise the member that there are four First Nations that are currently in active relationship with B.C. Lottery Corporation either by hosting or operating a facility. Cowichan First Nation, Squamish First Nation and Adams Lake First Nation all have community gaming centres that they host, and the Ktunaxa in Cranbrook are both the casino host and operator.

I can also advise the member that I just think that the question may misunderstand what MIRR is doing. What they’re doing is negotiating about the revenue from gaming as opposed to an expansion of gaming on particular reserves or targeting reserves or First Nations land for new casinos. It’s a negotiation about the revenues from gaming, and sharing those revenues with First Nations.

J. Yap: So-called single-game betting is not available through the provincial Play Now website because of federal laws. Obviously, this is a significant area for growth in the industry.

My question to the minister is: does he have plans to lobby the federal government to change their position on single-game betting?

Hon. D. Eby: The member probably knows that, at the federal level, reforms to the prohibition on single-game betting went all the way to the Senate, where it was defeated. Under the previous government, there were some efforts to try to get that to move forward through the FPT process, supported both by B.C. Lottery Corporation gaming policy and enforcement branch and the government at the time. The B.C. Lottery Corporation is currently working with other provincial counterparts in trying to strategize how to address this issue, given the defeat of the bill at the Senate.

One of the reasons for looking at taking this on is that there are so-called grey market but factually illegal gaming sites operating in British Columbia that offer single-game betting. They’re offering that in competition with the licensed and legal on-line Play Now platform offered by B.C. Lottery Corporation.

It is a difficult situation in that they offer this illegal product. They offer illegal single-game betting, and they’re competing with B.C. Lottery Corporation, which has protections in place around identifying problem gaming that may be taking place on line and so on. These operators do not, so there are some very serious issues with that as well.

[5:55 p.m.]

It makes sense, certainly to me, that B.C. Lottery Corporation be provided the opportunity to at least compete with these illegal sites. The government is also…. I am very interested in identifying ways in which we can address this issue of these illegal gambling sites operating in British Columbia, because there are no safeguards in place for British Columbians in the same way that there are through the regulated gaming system, whether on line or in person, in British Columbia. So I thank the member for the question.

J. Yap: I thank the minister and advise that my next questions are with regard to liquor. I want to thank the staff who came to support this part of the estimates. I welcome the staff from LDB and LCLB.

I want to start off with a question on mandate letters. In the past, the practice was to send two mandate letters, one dealing with the retail side of the business and the other the wholesale side. With the new government, one mandate letter only was sent to Mr. Lawson, the general manager. I’m wondering if there was a reason for this change.

Hon. D. Eby: Just to follow up on a question the member had asked earlier on the B.C. Lottery Corporation. We didn’t have the number right off — the number of employees working in addiction and responsible gaming. At BCLC, there are 11 employees, which includes the head, Dr. Jamie Wiebe, who’s an expert in the area, as well as a research and policy staff member at the B.C. Lottery Corporation.

The mandate letter that was provided to the LDB. As I’d articulated to the member earlier, given the length of time between the conclusion of the election and the swearing in of the new government and the need for implementation of new mandate letters on an urgent basis, mandate letters went out that were similar for many Crowns and organizations in government, one of which was the LDB.

It is different from letters provided previously. The member will see a significantly different mandate letter in the next fiscal year, now that we have the time to work with the LDB and stakeholders to ensure that it reflects the intention of this government, which is to make life better for British Columbians and to make life more affordable for them as well — and to support the public health concerns around alcohol use in the province, as well as the revenue-generation side of alcohol sales in the province that pays for a significant number of social programs.

J. Yap: We’ve seen news reports again this week about the perennial difficulty of getting in specialty wine orders to restaurants and retail establishments. What, if anything, is the minister’s plan to deal with this continuing aggravation?

Hon. D. Eby: I was aware of that report. I saw that report, as the member did, and it raised concerns for me. I canvassed it extensively with the LDB.

There are a couple of pieces at play here. One is, unfortunately…. Well, fortunately, there was a presentation at the ABLE-BC conference by LDB staff. Unfortunately, there was at least one individual that attended this conference and misunderstood part of the presentation, in particular, that the LDB said if you want to get a special kind of product that’s called spec product — this is a product that’s not listed as part of the LDB catalogue — in time for Christmas, you’re really well advised to get your order in before December 10.

[6:00 p.m.]

This was understood by at least one individual in an influential position within the private sector to conclude that if orders didn’t come in by December 10, then individuals would not be getting their spec orders for the holidays, which obviously caused a great deal of concern — and, frankly and disappointingly, unwarranted concern — that something had changed, that there was some new policy that was restricting their ability to get spec products. That’s one piece that’s at play.

The other piece that’s at play is the unfortunate history under the previous government in relation to the LDB distribution centre. In 2012 there was a decision made. Government was going to sell the Liquor Distribution Branch right before the election. This was a proposal that was being lobbied for by Patrick Kinsella, who was a backer of Christy Clark’s leadership bid.

Then government realized, “Well, maybe we shouldn’t do that, because it will be very costly to do that,” so they backed off doing that. Then in 2014, they decided to sell the LDB distribution centre. At the time, in 2014, everybody knew it was too small. It wasn’t fulfilling the needs of distribution. LDB had to move to a bigger and larger facility.

They sold that headquarters, but they didn’t have a plan about where to go. So what they did was they leased it back from the people that they sold it to. They leased it back for the next five years. Yeah, they leased it back for…. Functionally, it’ll be almost five years. They leased back a site that used to be owned by the public. It was too small then. That’s why it was sold.

In the meantime, between 2014 and now, real estate in the Lower Mainland has gone crazy, which has been a topic of considerable discussion in the Legislature, which made it even more difficult to find an appropriate new site.

I can tell the member — thank goodness — that we are ready for, hopefully, a 2018 opening of a new distribution centre, which is going to make a great difference in terms of delivering product to people, getting it to them in a timely way.

The LDB has implemented a new warehousing software system, which allows people to see not just what the LDB has in stock but also what the private suppliers, the agents, may have in stock as well. So they understand if they order it and it doesn’t show up in the order, it’s not the LDB’s fault. It’s the agent that doesn’t have any stock in their warehouse. So they’re not frustrated with the LDB when the order doesn’t show up when, in fact, it’s an agent that hasn’t delivered it.

There are a couple of different initiatives underway. The improvement and the transparency around the software will help people understand why they’re not getting their order when they order it. The new warehouse facility in 2018 will have a great improvement for everybody. It was an overcrowded warehouse in 2014, and business has only grown since then with the growth in population.

Finally, all of this was compounded by a misunderstanding of a very influential person in the industry which then resulted in a newspaper article that was not an accurate reflection of the state of either policy or distribution. I should also note, in that same article, there was a suggestion that the proliferation of beauty shops and barber shops with liquor primary licences was also placing increased demands on the LDB. I don’t even know where that came from. I think there were, like, five barber shops with these licences, and the LDB is handling that quite handily.

I thank that member for the question.

J. Yap: The minister talked about the new warehouse. Can he comment on the status of that project? Is it on time and on budget?

Hon. D. Eby: I am advised it’s on time, on budget and in scope.

I’d also like to do something that I was remiss in doing earlier. Members will have noted that a new group filled in behind me when we started talking about liquor. To my right, Michelle Carr, the ADM and general manager of the liquor control and licensing branch; behind her, Elaine Vale, director of policy, planning and communications of the liquor control and licensing branch; Blain Lawson, CEO and general manager of the liquor distribution branch; and Roger Bissoondatt, chief financial officer of Liquor Distribution Branch are assisting me here in answering the member’s questions.

J. Yap: Can the minister comment on the dispute filed by the U.S. and others regarding the retail sale of B.C. wines in grocery stores?

[6:05 p.m.]

Hon. D. Eby: The member refers to a trade challenge that’s been filed by the United States in relation to our wine, on grocery store policy, here in British Columbia.

I can advise the member that this is a federal matter that’s being handled by the federal government. We’re providing support to them in the negotiations, but as a matter of international trade, it is their jurisdiction. And that is the extent to which I can assist the member.

J. Yap: What is the status of the Bill 22 wine licences?

Hon. D. Eby: Under the previous administration, 12 licences were auctioned under what the member’s calling the Bill 22 licences. There are six remaining.

The government has put a hold on any further auctioning of these licences, given the trade challenges that this program has resulted in. We are waiting on hearing the results of that before we take any further steps on that program.

J. Yap: We all know that the craft beer industry has really blossomed in British Columbia. Can the minister give an update on the status of craft brewing and the supports that the previous government had initiated? How many craft breweries are now operating? How many applications are pending for new craft breweries?

Hon. D. Eby: I can advise the member that there are 163 licences currently. But as far as applications in front of the LDB, we’re going to have to get back to the member on that.

J. Yap: What is the status of the B.C. wine terroir strategy?

Hon. D. Eby: That issue is being worked on by my colleague, the Minister for Agriculture. It’s an agriculture-related issue.

J. Yap: What is the LDB strategy for craft or artisan spirits? Has a policy been developed for markup relief for spirits using natural grain alcohol not sourced in B.C.?

Hon. D. Eby: There are a number of issues with craft distillers, those that use 100 percent B.C. products and those that use neutral grain spirits sourced from products not in British Columbia. Those are currently in active discussion within the ministry and within my office. I don’t have any updates for any changes to those policies for the member today. But in the weeks and months ahead, he should stay tuned.

I’m certainly aware of the challenges that are faced by some members in the industry, whether because they hope someday to grow beyond the cap for the current markup relief or because they use a neutral grain spirit source from non-B.C. products. I’m engaged on the issue, and I don’t have any changes in policy to share with the member.

J. Yap: What is the status of hospitality pricing? Has it been introduced? If not, will it be, and when? If this is not happening, what is the plan to support small and medium-sized businesses in the hospitality sector?

[6:10 p.m.]

Hon. D. Eby: The member will be aware that we just got a C grade in a report card from our hospitality industry, in terms of the comparison of interprovincial policies. That grade was driven in part by the fact that, in British Columbia, there is no wholesale discount for hospitality. This is something that I raised as critic with the previous administration. I know it was raised in consultations with the previous government, but they chose not to address the issue.

I’m happy to advise the member that we recently retained Mark Hicken, who is an expert in liquor law not just in British Columbia but generally. He is also an expert in wine and was a member of the Vancouver International Wine Festival board. In addition, he is very active in the hospitality industry as well. He served on the board of the Hospitality Foundation of British Columbia. He is assisting me in ensuring that our policies are responsive to the concerns of industry, in addition to the already very capable advice that I am receiving from the ADM, Michelle Carr, from Blain Lawson, CEO, and their staff.

I feel that we have the team assembled now to really ensure that we’re responsive to the concerns of industry, including the hospitality industry. I thank the member for raising the question.

J. Yap: What’s the status of offering wholesale pricing to retail licensees?

Hon. D. Eby: The LDB currently offers wholesale pricing to cold beer and wine and private sellers as well as the government stores. I’m not sure if that’s what the member was getting at or not, but that’s currently already offered.

J. Yap: I was referring to discounts on the wholesale pricing, which I know many retailers were hoping for.

Hon. D. Eby: I know the member has been on this file for a while. I know he’s got a question here, and I’m just not understanding it.

There are no additional discounts, beyond the existing wholesale prices, for retailers contemplated.

I worry that I’m misunderstanding the member’s question. I do want to answer it. I wonder if you could rephrase it for me so I’m understanding a little better.

J. Yap: I’ll move on. How many private liquor stores are there in B.C., and what’s the breakdown between LRS and specialty wine stores?

Hon. D. Eby: We have 671 private liquor stores. There are 69 wine stores, including 20 off-site winery stores, seven VQA wine stores freestanding, 14 VQA wine stores grocery on shelf, ten specialty wine stores grocery on shelf, 11 independent wine stores, six sacramental religious wine stores and one tourist wine store, as well as 11 duty-free liquor stores.

J. Yap: Thank you for that.

There’s a moratorium on the number of LRS stores. I believe the end date is 2020 for this moratorium. If the minister could confirm that. And what are the plans with respect to this moratorium?

Hon. D. Eby: It sounds like people will be taking self-driving cars to the LRSs. It will be 2022, apparently, when the moratorium expires. There are no current plans to change that number or to make exceptions to that moratorium currently.

Noting the hour, Mr. Chair.

[6:15 p.m.]

The Chair: Thank you, Minister. One moment, please.

Hearing no further questions, I will now call Vote 14.

Vote 14: ministry operations, $427,236,000 — approved.

Vote 15: judiciary, $74,388,000 — approved.

Vote 16: Crown Proceeding Act, $24,500,000 — approved.

Vote 17: independent investigations office, $7,574,000 — approved.

Hon. D. Eby: I move that the committee rise, report completion and resolutions and ask leave to sit again.

Before we take the vote, Mr. Chair, I just wanted to thank very much all the staff who’ve been supporting me through the process for the Ministry of Attorney General and for the Crowns for which I’m responsible.

I’d also like to thank the member for his respectful questions, his interest in these files and his service on behalf of the public — as well as his colleagues who came forward, through this process, to ask questions.

Motion approved.

The committee rose at 6:16 p.m.