Third Session, 41st Parliament (2018)
OFFICIAL REPORT
OF DEBATES
(HANSARD)
Thursday, May 17, 2018
Afternoon Sitting
Issue No. 141
ISSN 1499-2175
The HTML transcript is provided for informational purposes only.
The PDF transcript remains the official digital version.
CONTENTS
| Routine Business | |
| Orders of the Day | |
Bill 5 — Community Care and Assisted Living Amendment Act, 2018 | |
Bill 6 — Employment Standards Amendment Act, 2018 | |
Bill 7 — Miscellaneous Statutes Amendment Act, 2018 | |
Bill 9 — Workers Compensation Amendment Act, 2018 | |
Bill 10 — Family Maintenance Enforcement Amendment Act, 2018 | |
Bill 11 — International Commercial Arbitration Amendment Act, 2018 | |
Bill 12 — Tenancy Statutes Amendment Act, 2018 | |
Bill 13 — Public Service Amendment Act, 2018 | |
Bill 14 — Taxation Statutes Amendment Act, 2018 | |
Bill 15 — Energy, Mines and Petroleum Resources Statutes Amendment Act, 2018 | |
Bill 16 — Securities Amendment Act, 2018 | |
Bill 17 — Motor Vehicle Amendment Act, 2018 | |
Bill 18 — Local Government Statutes (Housing Needs Reports) Amendment Act, 2018 | |
Bill 19 — Protected Areas of British Columbia Amendment Act, 2018 | |
Bill 20 — Insurance (Vehicle) Amendment Act, 2018 | |
Bill 21 — Class Proceedings Amendment Act, 2018 | |
Bill 22 — Civil Resolution Tribunal Amendment Act, 2018 | |
Bill 28 — Public Interest Disclosure Act | |
| Proceedings in the Douglas Fir Room | |
| Proceedings in the Birch Room | |
THURSDAY, MAY 17, 2018
The House met at 1:32 p.m.
[Mr. Speaker in the chair.]
Routine Business
Introductions by Members
M. de Jong: Visiting us in the precinct today is a group of 30 grade 5 students from Alexander Elementary School in Abbotsford. They are here accompanied by, I think, ten volunteer parents and, of course, their teacher, Ms. Patricia Kennaley. I know the House will make these students from Alexander feel very welcome.
Orders of the Day
Hon. M. Farnworth: I call third reading on Bill 30, Cannabis Control and Licensing Act.
Third Reading of Bills
BILL 30 — CANNABIS CONTROL
AND LICENSING
ACT
Bill 30, Cannabis Control and Licensing Act, read a third time and passed.
Hon. M. Farnworth: I call Bill 29, Voluntary Blood Donations Act.
BILL 29 — VOLUNTARY BLOOD
DONATIONS ACT
Bill 29, Voluntary Blood Donations Act, read a third time and passed.
Hon. M. Farnworth: In this chamber, I call committee stage on Bill 33. In the Douglas Fir Room, Committee A, I call continued debate on the estimates of the Ministry of Finance. In the Birch Room, Committee C, I call continued debate on the estimates of the Ministry of Tourism.
Committee of the Whole House
BILL 33 — SOUTH COAST
BRITISH COLUMBIA
TRANSPORTATION
AUTHORITY AMENDMENT ACT, 2018
(continued)
The House in Committee of the Whole (Section B) on Bill 33; R. Chouhan in the chair.
The committee met at 1:40 p.m.
On section 4 (continued).
S. Sullivan: The question that I have is around 34.27(3)(b). “Subject to subsection (4), money in the reserve fund, together with interest on it, may be used only for the following purposes…to pay principal and interest on a debt incurred by the authority as a result of an expenditure under paragraph (a).”
This section says that money can be used to pay interest on debt incurred as a capital expenditure. If a project is done as a P3 venture, will the debts payable for construction be included in this?
Hon. S. Robinson: It’s for capital that’s owned by the entity.
S. Sullivan: Question on 34.27(4). “If the amount to the credit of the reserve fund is greater than required for the purposes set out in subsection (3), the authority may, by bylaw, transfer all or part of the amount to another fund established by the authority for a capital purpose.”
This, I think, opens the door for scope creep. The question is: why is it that some or all of the remaining credit would be diverted to another capital fund instead of being returned to those who initially paid for this development cost or maintaining it within that transit area?
Hon. S. Robinson: First of all, this mirrors the current local government and greater Vancouver sewage district legislation — DCC legislation. It’s the exact same language.
If the member looks further down to section 7, the inspector needs to approve that, and there’s no reason why the inspector wouldn’t approve that.
S. Sullivan: Okay. If the inspector does approve…. I guess the real question is: will there be some connection to that original project? Can this just go anywhere that the authority wants it to go, or will the people who paid the DCCs actually, in some way, benefit?
Hon. S. Robinson: In this instance, the authority would need to demonstrate to the inspector that there’s a rationale for transferring these funds to another capital project. It’s intended to expand the transit system, so it still has to be consistent use for the transit system.
S. Sullivan: I think I’m hearing from your response that there would be some relationship between where the DCC came from and where it gets supplied.
Hon. S. Robinson: The expectation is that it stays strictly for capital use to expand the regional transit system.
S. Sullivan: But if it’s one end of the region, and then the amount from the DCC taken out of this region ends up going to a completely different area, that does disassociate the place from where it comes to the place where it’s spent.
Hon. S. Robinson: These are regional systems, so investments are made right across the region.
S. Sullivan: Okay. So 34. 31(1): “The authority and a collection entity may enter into an agreement under which (a) the authority agrees that all, or a portion of, the development cost charges that would otherwise apply are not required to be collected and remitted by the collection, and (b) the collection entity agrees to pay the authority an amount equal….”
The question: could the minister explain the reason as to why the authority would want to enter into an agreement with the collection entity to replace development cost charges with a payment? And if the payment scheme between the authority and a collection entity changed, would this impact those who have to pay the developer cost charge? If so, would they be notified of the change?
Hon. S. Robinson: This is a provision that provides flexibility. There could be some municipality, for example, where there may be an administrative burden in terms of collecting DCCs. It may not be part of the structure of the municipality. It provides the opportunity for the municipality and the authority to enter into an agreement that the municipality would directly contribute the portion of the DCC that’s required — directly from the municipality to the authority.
Sections 4 to 7 inclusive approved.
Title approved.
Hon. S. Robinson: First, I’d like to thank my support staff that are here with me. I’ve got Kevin Volk, Mary Storzer and Joshua Craig. I want to thank them very much for their work. And I want to express appreciation to the member opposite, who asked some very thoughtful questions. I express appreciation for his work on this bill.
With that, I move that the committee rise and report the bill complete without amendment.
Motion approved.
The committee rose at 1:50 p.m.
The House resumed; Mr. Speaker in the chair.
Report and
Third Reading of Bills
BILL 33 — SOUTH COAST
BRITISH COLUMBIA TRANSPORTATION
AUTHORITY AMENDMENT ACT, 2018
Bill 33, South Coast British Columbia Transportation Authority Amendment Act, 2018, reported complete without amendment, read a third time and passed.
Hon. S. Robinson: I call Committee of the Whole on Bill 34, Greenhouse Gas Reduction Targets Amendment Act, 2018.
Committee of the Whole House
BILL 34 — GREENHOUSE GAS REDUCTION
TARGETS AMENDMENT ACT,
2018
The House in Committee of the Whole (Section B) on Bill 34; R. Chouhan in the chair.
The committee met at 1:53 p.m.
Section 1 approved.
On section 2.
P. Milobar: I’m wondering if the minister can explain. I see they’re repealing paragraph (a) and changing it with the 2030 target. There was a 33 percent reduction previously in (a) by 2020, and now we’re seeing this change to a 40 percent reduction by 2030. I’m wondering if the trajectory of emissions, from the original bill, has changed.
In other words, the original bill spoke to continuing on. There was an interim target at 2020 of a 33 percent reduction. We now see this bill, with that same continuation of an even lower emission target than 40 percent, but 40 percent by 2030 is the new target. Is that the original target timeline, from the original bill in 2007, for 2030?
Hon. G. Heyman: There was never a 2030 target, specifically. There was a 2020 target of 33 percent, as the member knows. In November 2015, the climate leadership team appointed by Christy Clark and the former government reported out that it was impossible to meet that target. In fact, emissions rose in British Columbia by 4½ percent between 2010 and 2015, and that target is clearly out of reach.
The climate leadership team recommended that in order to meet the 2050 target, a target of 40 percent below 2007 levels was an appropriate and achievable new target to set. We have committed to adopt that, despite the fact that two and a half years have passed since that target was recommended — one and a half of them under the former government — without actions being taken. We still believe that that’s achievable. We’ve added a 2040 target so that we can indicate to British Columbians and to industry that there is a clear path to achieve the 80 percent reduction by 2050.
P. Milobar: Thank you for that answer, but it didn’t really answer the question that I was looking for. I understand that this is a 2030 target — in writing, within this bill — to replace the 2020 target in the previous bill, but the end point in both bills has always been an 80 percent reduction by 2050.
The question was: is this 2030 target that is now being inserted into this bill, a 40 percent reduction, in keeping with any internal projections of a trajectory? You can’t go from a 33 percent to an 80 percent reduction overnight. Obviously, there has to be a steady regression of reductions.
Is the 40 percent reduction by 2030 targeted in this bill on the same trajectory level as the original bill, which had a 2020 target? Is that the same? There must have been some internal targeting for 2030. There were five-year check-ins on the previous bill. There was supposed to be every-even-year reporting, as this bill updates as well. Certainly, there had to be some internal benchmark targets, from the original bill, from 2020 to 2050. Was that original 2030 target 40 percent, or was it higher than 40 percent? Was it supposed to be 42 percent, or was it supposed to be 38 percent?
Hon. G. Heyman: In terms of internal modelling of where we could be by 2030, based on an assumption that we were going to meet the 2020 targets, this is less steep. What we have chosen to do and what the climate leadership team suggested in 2015 was that we have a steady and gradual path based on where we were at that point, which was considerably further behind where British Columbia should have been, if the path to the 2020 target had been maintained.
It is a gradual, achievable path on the way to the 2050 target, as recommended by the climate leadership team.
P. Milobar: Just to clarify, to make abundantly clear what “less steep” means in terms of a trajectory, the original 2007 legislation spoke to a 2020 target that is being repealed by this 2030 target, and that original trajectory from back in 2007 would have spoken to a greater reduction than the 40 percent reduction that we see in this bill.
Hon. G. Heyman: The original plan internally, in order to meet the targets, was about a 2.53 percent reduction in greenhouse gas emissions every year. But of course, as I’ve pointed out, after the first couple of years, emissions began to rise again, with both a change in leadership in the previous government and a change in policy emphasis with respect to maintaining the kind of momentum needed to drive those continual reductions.
Yes, this is less steep than would have been achieved had the previous government and government policy kept us on that 2.53 percent reduction path per year. But it is, nonetheless, a gradual and direct line between now and the legislated goal of 80 percent reduction by 2050, as recommended, as I’ve said before, by the climate leadership team in 2015, in recognition of the fact that emissions had risen instead of going down and there was a need to recalibrate.
P. Milobar: Could the minister provide, then, what that original percentage was? I don’t have my calculator with me. The 2.53 a year would have originally resulted in a 2030 target of what percentage versus the 40 percent that we see in this bill?
Hon. G. Heyman: I’m going to, perhaps, give a bit more information than the member requested, but it’s useful to set context.
Under the initial legislation, with a 2020 target of a 33 percent reduction below 2007 levels of 64.6 megatonnes, we would have been looking to get to about 43.3 megatonnes by 2020. The last calculation in 2015 is 63.3 megatonnes. So that leaves a gap of about 24½ megatonnes to go to meet our target by 2030.
Obviously, it’s a big gap between 63.3 megatonnes in 2015 and the possibility of achieving 43.3 by 2020, which is precisely why both the climate leadership team and the government of the day said that it was impossible to meet the 2020 targets. But if emissions had not gone up between 2010 and 2015, if policy and choices and actions of the government of B.C. and within B.C. had continued, the overall trajectory between 2007 and 2020 would have been about a 1.43 percent reduction a year.
In order for us to meet our 2030 target, the new target, given where we’re at today, we need to reduce emissions by about 2.44 percent a year going forward. That will be challenging, but the climate leadership team believed it was possible with hard work and dedication and a good climate action strategy, which we will be developing and consulting British Columbians on and releasing in its totality — although we’ll have benchmark announcements along the way, between now and fall 2018.
P. Milobar: I have several questions around the trajectory. I think it’s very important for people to understand what the original trajectory targets were and what these new targets are, especially in the context of the environment we’re living in right now, politically, in terms of so much hanging in the balance in terms of the government’s ability to govern and the stated reality of whether or not a new climate plan is actionable and achievable or not by the members of the Third Party, which is a totally understandable position to take.
The previous answer the minister gave was that the original trajectory was slated to be 2.53 percent a year. Even if we are generous and start that clock in 2010 to get to 2030, that means that by 2030, we would have seen a 50 percent reduction, instead of the 40 percent that we see in this bill. If you start the clock in 2008 to 2030 with that 2.53 percent trajectory — and this is without any compounding; this is just straight across — 22 years times that is a little over 55 percent reduction by 2030. Those trajectories were created to get to an 80 percent reduction by 2050.
The typical, easiest areas to start to find large reductions, it stands to reason, are on the front end of these types of plans, as you can get to the big sources that are easier, potentially, to change out or see large gains made. It would be natural to see a trajectory start to flatten out and those last few needed percentages be much harder to get, to be much less large scale.
Now we’re hearing that the new trajectory is 2.44 percent in this plan, which would indicate that there’s either a slated trajectory that’s going to try to stay on a constant, steep downward pressure or a levelling off. So I’m curious, then: 2040, under the old plan at 2.53, would be another ten years. We’d be at — 55 plus 25 is what? — almost 80 percent right there, by 2040.
The trajectory is now to, say, 60 percent by 2040. So what would have been the original waypoint check-in percentage of 2040 of the original plan versus what this new piece of legislation is suggesting we have? We never did have a 2030 or 2040 in print — a waypoint check-in place. But there had to have been modelling in the background to get you to that ultimate target of 80 percent reduction by 2050.
Hon. G. Heyman: Well, there are a number of variables and assumptions. We’re going to have to do the best that we can.
First of all, I want to correct something I said in my last answer. This is one of the problems with playing with numbers on the fly. I previously said that the former plan had us reducing 2.53 percent a year to reach the 2020 target. Then I said 1.43 in a subsequent answer. It is 2.53. So the member is correct, and my second answer was not correct. My first one was.
The other thing to note here is that if that trajectory were to continue, however…. The member’s quite right. You achieve some greater reductions early. If we were to continue, for instance, a 2.53 percent reduction not compounded over the life of the legislation until 2050, or 42 years, there would have been a 106 percent reduction in emissions, which clearly is impossible. Obviously, things change as you go forward.
With that in mind, the goal would now be, in order to reach the 2030 target, about 3.33 percent a year, but my previous caution still applies.
The rest of the member’s question was: how are we going to get there? That’s precisely the modelling and strategy that we will be developing between now and the fall. If it was developed now, I would answer the question now, but I’m not able to do that because we’re developing the strategy. But suffice it to say, the original modelling that was done in 2015 showed ways to get there. Clearly, that will have to be adjusted, but we don’t believe it’s impossible. It will be challenging, for sure. But we will do modelling, and we will share that with the member and all British Columbians.
P. Milobar: Thank you for that clarification. So the new target has to be almost 1 percent a year more than the previous target, almost about a 33 percent reduction per year to be able to hit it.
Was the original modelling…? Did it contain the prospects of the impact of LNG and its plan compared to the potential impacts of this plan? I can appreciate there needs to be the full plan still fully vetted out, but the target is still a target. The prospect of LNG being put into a plan that now sees a one-third increase in how aggressive the yearly target-making has to be would be a significant difference in potential ramifications.
I’m wondering: did that 2007 plan that set those initial targets on a rate of a 2.53-percent-a-year reduction include LNG, now that we see a plan that’s going to require a 3.33 percent yearly reduction?
[L. Reid in the chair.]
Hon. G. Heyman: First of all, I think that the member said “almost” 1 percent. It’s 0.8, which could be almost 1 percent. But it is 0.8 percent more.
With respect to the question about the 2007 plan, it’s a little difficult for me to answer, because that’s 11 years ago and many of the staff who were there at the time are no longer here. But there wasn’t really a plan. There were legislated targets, and then the climate action secretariat was formed to begin to develop a plan. But LNG was not really a factor in 2007. It wasn’t particularly a provincial consideration.
The climate leadership team, in 2015, however, when modelling the possibility of achieving reductions of 40 percent by 2030, did include some LNG development. I believe it was along the lines of one large development and one smallish development.
P. Milobar: Yes, I recognize it’s 0.8. Percentage-wise, it’s still about a 33 percent — I guess we could call it 31½ percent — difference from 2.53. It’s still about a third of an increase, which is not insignificant, though.
I think the key to that difference is that if we’re looking at a target that is actually seeking to have greater reductions than what we saw in previous years or than were attainable in previous years, all these years down the road that didn’t include an LNG industry at the same time, that 0.8 or that 33 percent increase to reductions yearly starts to become a very significant number with this new plan.
I’m asking these questions because when we spoke to this at second reading, the minister was pointing out how significant these changes in this plan are. I’m trying to get to the heart of how significant they actually are.
To clarify, then, with the minister, the target itself hasn’t changed. The 2030 target and the 2040 target haven’t changed from what we saw coming forward in 2015, with a new look and a review of where we were at with things. The 3.33 percent reduction would have been the same recommendation, then, to hit that trajectory point that was the 2015 update.
It’s really around: how is the minister going to manage the various sectors, including the LNG industry? Is that what I’m hearing with the answer?
Hon. G. Heyman: It’s difficult to talk about targets for 2030 or 2040 essentially being the same as under the previous legislation or the previous plan, because the irrefutable fact is that emissions rose by 4½ percent between 2010 and 2015.
Now, I’m going to assume that at some point, whoever was in government, people wouldn’t have let them continue to rise between now and 2050, because the outcome of that would be catastrophic. What I could say and will say is that I hope we’re all, on all sides of this House, committed to meeting the B.C. target of 80 percent below 2007 levels by 2050, not just because it’s B.C. legislation introduced by an iteration of the previous government in 2007, but because it’s also Canada’s commitment. It’s the world’s commitment.
I think we all recognize that there are deep economic consequences, as well as human consequences, not just in the south, not just in low-lying island nations. We’re seeing impacts today that are affecting the economy and affecting people’s homes, and they’ll only get worse if they continue to rise. All I can say is that we’re committed to trying to set a reasonable set of interim targets between now and 2050. That’s what we’ve done with a 2030 and a 2040 target.
We will be developing a plan across different sectors of life and the economy, buildings and homes, transportation and industry, to show how we can put together a mix of measures in every area of B.C. life to move us toward that target in a reasonable way and in a way that seizes economic opportunities, helps to transition our economy in a planned and deliberate way, rather than waiting too late and having to have massive disruption one way or the other by the actions we have to take or by the consequences of failing to take action.
P. Milobar: Well, I think there are two separate things. There’s setting a target, and then there’s trying to get to the target. There’s no doubt — it’s well known — that we weren’t going to hit the 2020 target. You’ve not heard any dispute around that, and I don’t think you’re hearing any dispute around the fact that we need to continue to redouble efforts and try to see reductions.
However, we are in a unique parliamentary situation right now where we do have a government that’s been told very clearly, several times publicly, that their very existence hinges on a plan coming forward that’s not just setting targets but is actually achievable. So we need to get to the root of: is this target achievable? A target’s laudable; whether it’s achievable or not is another question.
Another question I would have around this section is the addition of: “The minister… by order” establishing “greenhouse gas emission targets for individual sectors.” My assumption is — the minister can correct me if I’m wrong — that this would give the minister the ability, through regulation, to be able to set targets for individual sectors.
If an LNG final investment decision was to come forward this summer, would that give the minister the ability to provide reassurance and targets that LNG would expect to be held to, for them, as they’re making their final investment decision? Does that give more certainty for the minister and the LNG proponents, regardless of where they may be located, to know, whether or not, what their targets would be moving forward as they’re making their investment decision?
Hon. G. Heyman: First of all, I just want to clarify for the member that the bill refers to a ministerial order, not a cabinet order. They have effectively the same weight, but they are different. The intention was not to drill down very deeply beyond what the climate leadership team suggested in 2015. The sectors, broadly, are industry, transportation and buildings and homes in communities. In the ability to set the order is to have the flexibility to see where there is great opportunity and where adjustments may need to be made to meet the overall targets for 2030, 2040 and 2050.
The idea, and this was what was communicated to LNG Canada in a letter from the Premier, was…. One of the conditions that the province had, that we’ve always had, is that LNG development needed to fit within a legislated emission reduction target.
That would be reached by government working with industry, including the LNG sector, to identify opportunities for, overall within the industrial sector, meeting the reductions that would need to be the industry sector’s contribution to meeting our target of 40 percent reduction.
The member has gone a bit further and asked specifically how that can happen. All I can say is what I’ve said before. We’re working on the strategy. It will be released publicly. We’re engaged with industry. We’re engaged with municipalities. We’re engaged with the Climate Solutions and Clean Growth Advisory Council.
We’re engaged with different industries — for instance, oil and gas, cement, forestry, the building sector — about how we can work together to ensure a smooth transition, economic opportunity, application of technologies, use of incremental carbon tax revenue, clean technologies funds and incentives to set and meet world-leading benchmarks. That is all being worked on.
As elements are finalized, some of them will be announced between now and the fall, and they’ll all be knit together in a strategy that British Columbians and members opposite will be able to judge and, certainly, question.
P. Milobar: Thank you for that answer. I do recognize that it may not be the intent. However, all the industries the minister referenced in that answer, other than LNG, currently exist, currently operate and currently provide a source of emissions to our overall GHG load. LNG doesn’t in any significant way, shape or form. That’s a new insertion in. I fully recognize, and I think it’s safe to say we canvassed this point fairly well in estimates — it seems like so long ago now — that the plan will come forward in the fall. The minister has been very consistent with that in all the answers today and as we spoke to this bill earlier as well.
However, there is the potential, as we’ve just seen over the last couple days in the media, as well, of a final investment decision for LNG of a $40 billion investment decision sometime before, potentially, the plan is actually developed and released to the public and given public scrutiny.
The question around item (b)(4), adding that subsection, is: does that give the minister the ability, the authorization, to sit down with a proponent for an LNG plant and be able to say definitively: “This will be what your GHG targets will be if you choose to make a $40 billion investment decision in British Columbia”? Does that give the minister more certainty to make that statement to someone like an LNG proponent over the summer months when this House is not in session, versus after the plan is official and public?
Hon. G. Heyman: Again, I think it’s implicit, in the Premier’s letter to LNG Canada about needing to fit within our legislated GHG reduction targets that will be in place when this bill becomes an act, that they would be working….
If they choose to become part of B.C.’s industrial sector or if any other LNG proponent in the future wishes to be part of B.C.’s industrial sector, regardless of what happens with the current proposal, there’s an onus to work with the rest of the industrial community to collectively discuss how to reach the target. I’ve certainly engaged with members of industry associations as well as the Business Council of B.C., saying essentially that and offering to work with them.
But it’s not my intention to use this bill, nor was this bill drafted with that intention, to give the minister the power to use this to point specifically to a target for LNG. It’s thought of more broadly in terms of, as I said, the three large sectors that were identified by the climate leadership team in 2015.
P. Milobar: Thank you for that answer too. However, I’m not curious about the intention; I’m curious about the legislative power that this clause would actually provide or not. Ultimately, that’s what could change tomorrow, next week, a month from now, if someone comes and knocks on the minister’s door.
If we have targets set for the industrial sector, certainly I think the minister could recognize that not every piece of that industrial sector is going to be asked to find the same types of GHG reductions or have the same impact of the overall number. Every industry is distinctly different by what it generates, by what ability it has to try to reduce.
We’ve heard the minister talk at length about making sure that trade-exposed, energy-intensive industries are kept competitive. So each type of industry within the industrial sector is going to have its own individual range of targeting that it’s going to need to meet within that overall bundle called the industrial sector.
The question was: does this clause give the minister the legislative ability, the legal ability, to sit down with an LNG proponent and give certainty and a legally valid assurance that this would be what their expected target would be if they chose to go ahead with a $40 billion investment?
It’s not what the intention of the minister today is but what the legislative ability of this section provides the minister to do. What extra power does it grant him? Does he have the power to make that type of call, over the summer months, before the public and this House would see what the final climate action plan would look like moving forward?
Hon. G. Heyman: I can say to the member, and to all members, we certainly never contemplated that. That’s not why the section was drafted the way it was. We don’t think of LNG as a sector. Again, we think of the sectors as being industry broadly, the built environment broadly and transportation broadly.
I mean, it would be up to legislative counsel to say if it was hypothetically possible to use a ministerial order in that way. We haven’t thought about it, because that’s not why it was drafted. That’s not what we were thinking of doing. That’s not what we are thinking of doing.
Our approach has been to work with industry broadly, in a collaborative way, to say: “Here’s where we see economically viable opportunities over time to reduce emissions to fit within an overall strategy and plan to meet our targets.” That’s the approach we’re taking.
P. Milobar: Well, you know what they say about roads being paved with the best of intentions.
I’m having trouble understanding…. The people within government, the public service, are very professional, very much know what can and can’t be done with various clauses as they get inserted into bills. There’s not a definitive answer as to whether or not…. Again, it’s maybe what the minister’s intentions are, but we’re talking about international, large companies.
I know that the minister, in previous career paths, probably would have been very leery of the negotiating clout and style of large international companies with multi-billion dollar potential — with thousands of jobs and economic growth, waiting, and the pressure that puts on a government as people are trying to negotiate and get to a final investment decision.
We saw it with the recent announcements around tax rates and other things of that nature as they relate to LNG as well. Again, this side fully supports LNG. I’m not trying to give that impression. But it’s not out of the realm of possibility that a company, any company — and not out of malice but out of due diligence on their part, as they’re trying to decide whether to invest $40 billion, and you have the potential of an updated greenhouse gas target plan coming in — is wanting to know with certainty where they are going to fit within that plan.
Does this clause, whether it was intended to provide the minister that ability or not, provide the minister the ability to give certainty around an LNG plant — what their individual targets would be expected to be, moving forward, within any type of greenhouse gas reduction plan being contemplated?
Hon. G. Heyman: I think I’ve answered the question. I could keep repeating the answer, but I don’t want to do that. I think a single LNG plant, or even LNG, is not a sector within the contemplation of either the climate leadership team or general economics — and certainly this bill.
What LNG Canada requested from the B.C. government was some clarity around the financial conditions, the tax considerations and any other conditions that would pertain. The Premier outlined those in a letter. The company expressed appreciation for the clarity of the letter and said they were satisfied that they had the information they needed to speak to their investors.
The LNG Alliance has expressed to our government and me, personally, the same. They appreciate the clarity, and they believe they have the information they need going forward. Others in the broader oil and gas sector have said the same thing.
I think that’s all the answer I can give.
P. Milobar: I appreciate the minister’s answers. You know, I’m really not trying to make this a gotcha moment. But cabinet shuffles can happen tomorrow. I don’t think they will. I don’t think the minister has put himself in that position, but that does happen. Governments could change tomorrow — or I guess 29 days from tomorrow. I don’t think that’s going to happen either, but it will happen at some point in the future.
The minister will not be the minister in perpetuity, but this bill will. So the language in this bill is very important to understand what powers it gives both this minister and future ministers that wasn’t in the previous bill. It was important enough to insert in, so I think it’s important for everybody to understand what powers that actually gives this minister and future ministers around this topic.
I can appreciate the minister saying that LNG is part of the overall industrial sector. However, that’s just a recommendation, and that’s language being used in a yet-to-be-approved updated document in the fall, which also isn’t a piece, necessarily, of this legislation. It’s more of a guiding document, as the minister has reminded me in estimates several times as well, in terms of potential ways to action and move forward to hit these targets.
Again, does this give the minister…? I guess I’ll rephrase the question a little bit around ministerial powers and even take LNG out of it. Does it also give the minister the ability to define what sectors there are? Currently there are three excepted sectors, but that doesn’t mean you couldn’t have a fourth. It doesn’t mean LNG couldn’t be its own stand-alone sector, if that’s what people want to see in a plan moving forward.
There’s nowhere in this legislation that I see, in this update, and there’s none that I see in the original 2007 legislation that clearly identifies those three individual sectors as the true individual sectors that would be referenced here as individual sectors.
Does this, again, give any Minister of Environment the ability, the authorization, to move ahead with individualized targets within sectors and/or actually create however many sectors they would like to see? Instead of three, we could have four sectors, where LNG is a stand-alone sector that, under this provision, would have the minister have enough power and authority to then grant that sector its own target.
Hon. G. Heyman: I’ve spoken to the member about the intent of the government, not just this minister but the government, and the reasons why the legislation was drafted the way it is. The member seems to be looking for a yes-or-no answer, so the answer is yes.
P. Milobar: So to summarize, if section 2, without further amendments, is passed, those voting in favour would be voting on essentially the same targets that we saw laid out in 2007, with updated dates, with the relevant target numbers that would have been on about the same trajectory — actually, I guess it was a 33 percent different trajectory now, in fairness — to try to catch up.
We would also be voting in favour of allowing the Minister of Environment to be able to make an industry-specific promise or assurance to some industry, like an LNG industry, of what their sectoral targets would be, even in the absence of an updated plan in the fall.
Hon. G. Heyman: The answer to the first part of the minister’s question is no, because we’re repealing the 2020 target, which was set in 2007. We’re repealing it specifically because it can’t be reached.
Interjection.
Hon. G. Heyman: Apparently, I called the member “minister” instead of “member.” I meant member.
Also, I don’t think it’s reasonable or quite accurate to say that the other targets that are set for 2030 and 2040 are consistent with what was done in 2007, because they simply didn’t exist.
The answer to the second part of the member’s question, with respect to ministerial orders, is as I’ve said previously: yes, just as it is in almost every piece of legislation that contains provisions for future standards, future limits, future numbers, to be set by order-in-council or by ministerial order. It’s a common practice.
Sections 2 to 6 inclusive approved.
Schedule approved.
Title approved.
Hon. G. Heyman: I move that the bill be reported as complete without amendment.
Motion approved.
The committee rose at 3:02 p.m.
The House resumed; Mr. Speaker in the chair.
Report and
Third Reading of Bills
BILL 34 — GREENHOUSE GAS REDUCTION
TARGETS AMENDMENT ACT,
2018
Bill 34, Greenhouse Gas Reduction Targets Amendment Act, 2018, reported complete without amendment, read a third time and passed.
Hon. G. Heyman: I now call estimates for the Ministry of Advanced Education, Skills and Training.
Mr. Speaker: This House stands recessed for five minutes.
The House recessed from 3:05 p.m. to 3:11 p.m.
Committee of Supply
ESTIMATES: MINISTRY OF ADVANCED
EDUCATION, SKILLS AND
TRAINING
The House in Committee of Supply (Section B); L. Reid in the chair.
The committee met at 3:11 p.m.
On Vote 11: ministry operations, $2,211,614,000.
The Chair: Does the minister wish to introduce her staff?
Hon. M. Mark: Yes, I do. First, I’d like to acknowledge that we’re gathering on the unceded territory of the Lekwungen-speaking people, the Songhees and Esquimalt First Nations.
I’d like to introduce my staff who are with me: my deputy minister, Shannon Baskerville, to my right; my assistant deputy ministers, Jeff Vasey and Bindi Sawchuk, as well as Kevin Brewster; and Tony Loughran, my executive lead.
This is my first time doing this in this House, in these chambers. Other staff will be joining us as their expertise is needed this afternoon. I’d like to thank the members opposite for being here today and being advocates for post-secondary education, skills and training, and allowing me to provide a brief introduction to today’s estimates.
My first ten months — it will be ten months tomorrow as minister — have been busy, exciting and inspiring. Our government is working to ensure all British Columbians can access affordable education and training. This includes a commitment to the implementation of the UNDRIP, the United Nations declaration of the rights of Indigenous peoples, as well as the 94 calls to action of the Truth and Reconciliation Commission, which the Premier included in my mandate letter — and for all members of cabinet.
We know that education is a great equalizer that can transform people’s lives. We’re striving to make it more affordable for people to get an education so that they can unlock their full potential. Our government was elected on three pillars — making people’s lives more affordable, improving the services that people count on and creating an innovative, sustainable economy for people to get 21st-century jobs.
We’ve been quick to make post-secondary education more accessible and affordable. Budget 2018 included historic investments in tech talent and early childhood education. We’ve added hundreds more opportunities in trades, teacher training, health care, engineering and computer science. Affordability barriers are being removed.
From aviation to animation, from tourism to trades, we need it all. We opened the doors to adult basic education and English-language-learning programs for thousands of students by making them tuition-free. The interest rate for B.C. student loans was cut by 2.5 percent, providing about $1.5 million in interest relief, in 2018 and 2019, for about 200,000 students.
The first provincewide tuition waiver program to support former youth in care was rolled out in September at all public post-secondary institutions across B.C. As a result, 77 percent more students this year are attending public post-secondary institutions and benefiting from this program. That’s over 335 former youth in care accessing life-changing education. I believe in them, I know the member opposite believes in them, and we know that it’s about making their future brighter. In fact, I just heard last week the story of a young woman who is now studying pre-med and who hadn’t even thought that she would be going to university as of last year.
We also announced the first major investment in tech programming at post-secondary institutions in over a decade. A total of 2,900 tech spaces will provide 1,000 additional tech grads by the year 2025. This includes the first full software engineering program in the Interior, at TRU, and the first full civil and environmental engineering degree in northern B.C., at the University of Northern British Columbia.
In March, at an event with the Songhees Nation, I was thrilled to announce $21 million over three years for the Aboriginal community-based training partnership program. Over 40 communities will receive funding to provide Indigenous learners with the education and skills to further their education and advance their careers.
In December, which feels like decades ago, we launched a public education campaign to raise awareness about sexual violence prevention and misconduct and to respond to strengthening the policy. We received about 370 submissions providing feedback from students, faculty and staff on what more can be done to prevent sexual violence on campus. We’ll continue to work with public institutions and stakeholders to strengthen the policy on this very, very important issue.
Affordable and accessible quality post-secondary education will ensure that no British Columbian is left behind, so that we can share the wealth of our strong economy. That’s why our Premier announced yesterday, at the B.C. Tech Summit, a historic $12 million for graduate scholarships, supporting 800 grad students in B.C. with scholarships of $15,000 each. We will continue to lift as we climb, as we break down barriers.
The ministry has successfully negotiated a new workforce development agreement with the government of Canada. It will provide $685 million over the next six years to deliver new programming that supports workers and employers. Programs will help vulnerable and underrepresented groups receive skills training and employment support so that they can get good-paying, family-supporting jobs. This will mean hope and opportunities for groups such as Indigenous people, older workers, survivors of violence and individuals who face barriers such as mental health challenges and homelessness.
We’ll also be able to better respond to skills training needs of communities and employers with more flexible and timely programming. At every opportunity, I’ve travelled across the province and met with students, faculty, skills training providers and staff to listen, learn, engage and move forward on our shared goals.
I’m proud of the choices our government has made and the work that we’ve done over the last ten months. I’m very excited about the months and years ahead as we build the best B.C. I look forward to answering questions.
S. Cadieux: Thank you, Minister and staff, for being here today to answer questions on the Ministry of Advanced Education, Skills and Training. I’m going to start out with some general questions, some questions around budget and a couple of other topics. Then the member for Abbotsford-Mission will forward on from there with more things specific to skills training and capital.
Just to start off, the minister, in her opening statement, mentioned investments in aviation. I know that the minister travelled to Kelowna in February to examine a partnership that is underway with KF Aerospace and issued a press release in which she was quoted. Can the minister confirm for me or explain for me her decision on approving the visit and the accompanying press release? Were any of the decisions made regarding her speaking notes, press release, logistics for the event, any approvals, done by email?
Hon. M. Mark: I believe the date was February 8. I just had my staff look through the calendar. All records that would have been approved would be with the office of primary responsibility, which would be GCPE. They do the event planning for our ministry and make arrangements on press releases and podium setup and all of those details that happen, logistically, for events.
S. Cadieux: So the minister didn’t approve anything via email response to GCPE. The minister did not do any follow-up from that visit to the owner of Kelowna Flightcraft or any of the other institutions, like Okanagan College, that she visited that day — to the president, to say: “Hey, thank you very much for the visit.” There were no emails that originated from the minister’s account, then.
Hon. M. Mark: With respect to what the event is going to be, where it is, what time it is, all of those logistics are left to GCPE. There were no email thank-you notes to presidents or KPU. There were no exchanges whatsoever by email. The discussion and the planning happens in my ministry office, with my staff, when we look at the logistics of: what is the best time to fly up? What is the best time to fly back? The rest is organized by the staff to host that event.
S. Cadieux: All right. A similar question, just for clarity. The minister mentioned the historic event, the event with the Songhees First Nation around Aboriginal training. Good announcement. I congratulate the minister on that. But again, that event happened in March. Is the minister confirming today that there were no emails originating from her office to anyone related to that event either?
Hon. M. Mark: Sorry, I apologize that I’m using acronyms. So GCPE, government communications and public engagement, managed the logistics of the events — the podium setup, if there’s coffee that’s required, connecting with the host and, potentially, putting out a press release. There’s a lot that goes into the planning and the execution of an event, as the member opposite can relate in her previous experience. But all final records of how that day is launched are with GCPE.
S. Cadieux: I’m just trying to get some context about how things operate. I understand how events are planned through GCPE and how the records of decision would be kept.
In the months of February, March, April or May, has the minister sent any emails to anyone like a university president or a faculty association representative or a student association representative to say hello, to say thank you for a meeting, to initiate a meeting? Has she had any direct contact from her personal government email account with anyone outside of her ministry?
Hon. M. Mark: I can’t say with 100 percent accuracy that I haven’t sent an email in that period to anyone. I can tell you that I sent a thank-you card to the president of Simon Fraser University — a hand card from the minister’s office. With respect to Outlook and email addresses that are populated, I do not know any of the emails of any of the presidents at any of the 25 post-secondary institutions.
I can almost say with 100 percent accuracy that I’ve never sent an email to any of those presidents or to the student body — the federation of students and the AMS student body. So I can say with 100 percent confidence — close to 99 percent confidence — that from my Outlook sent email, melanie.mark@gov.bc.ca, I have never sent those emails.
S. Cadieux: Thank you, Minister. I’m a little surprised that the minister hasn’t sent any emails to any stakeholders herself or had any contact with stakeholders directly. But that’s fine. Thank you for the answer.
Moving on. UBC pays about $1 billion in salaries every year and will be facing approximately $23 million in employer health tax. What is the total impact on university budgets of the employer health tax?
Hon. M. Mark: I just wanted to clarify one point that was made earlier, because I really appreciate the nature of the question from the member opposite about relationships. I value the relationships of the stakeholders in post-secondary. There are 25 presidents. There are student bodies and advocacy groups.
The nature of our business is in person. The nature of our businesses is visiting their campuses. If they have official requests, that is all managed through the ministerial public account email address. That is all filed under CLIFF.
[R. Chouhan in the chair.]
I leave the nature of that work to be all in the public record for any official business that they have a request for so that we can track and change. When the member opposite says…. I find it a little bit odd. I apologize, but the way I do business is in person with folks because I think the 25 institutions appreciate that relationship.
With respect to the question regarding the employer health tax, we’re still in discussions with all public post-secondary institutions about the employer health tax and the elimination of MSP. At this moment in time, it’s premature to draw any conclusions about the employer health tax.
S. Cadieux: From the minister’s comments now about the employer health tax and discussions, does that mean, then, that the minister and the ministry did know calculations ahead of the announcement of the tax in the budget of what the impact on universities would be?
Hon. M. Mark: Thank you to the member opposite for the question. This is the Minister of Finance’s responsibility, the employer health tax. Our government is fully eliminating MSP premiums, saving individuals up to $900 a year and families up to $1,800 a year.
To ensure funding for our health care system, we’re introducing the lowest payroll tax in Canada. We have set an implementation date of January 1, 2019 to eliminate MSP premiums so we can have a smooth transition for all employers, including the public sector. The transition gives the Minister of Finance the time to have the conversations we need with all public sector employees, including public post-secondary institutions.
S. Cadieux: Is the minister saying, then, that the public should disregard the three-year budget plan and the balanced budget that it proposes?
Hon. M. Mark: I thank the member for the question. The Minister of Finance is responsible for the employers health tax. Budget 2018 brings many benefits to British Columbians, and of course, the public should not disregard Budget 2018.
Just a few highlights from the Ministry of Advanced Education, Skills and Training: $400 million to invest in new student housing; $19 million annually for adult basic education and English-language-learning programs; $30 million over three years for Indigenous skills training; $2 million for Canada’s first Indigenous law program at UVic; $11 million added to technology programming; $7.4 million for new early childhood educators; $6 million for tuition-waiver programs for former youth in care; $30 million for agreements with young adults; and investing in skills and training through our workforce development agreement with the federal government.
I look forward to having a discussion about our budget within the Ministry for Advanced Education, Skills and Training.
S. Cadieux: The budget for the Ministry of Advanced Education, Skills and Training certainly doesn’t, over this year or the next two, have an additional $70 million, rough estimate, to cover the employers health tax for universities or a number of the programs, which we’ll get to in a moment, that have been announced. I’m curious as to how institutions are expected to defray these costs.
I’m assuming that the minister has had…. She insinuated in one of her earlier questions that she’s having discussions with institutions about the EHT and its implications. I think it’s legitimate for the Minister of Advanced Education to talk about how she anticipates that the institutions, for which she is responsible — the universities and colleges — are expected to cover an increased cost when their tuition cap is 2 percent and they’re already stretched to provide their mandates within their current allocations.
Everyone I’ve spoken to so far was expecting to see a bit of a bump in the Advanced Education Ministry, in the budget, which they didn’t see, and instead are seeing a whole lot of new, piled-on expenses.
One more time to the minister: if there’s approximately $70 million in new costs coming to the ministry, which line of the budget would she expect to take that money from to cover it?
Hon. M. Mark: The Minister of Finance is responsible for the employer health tax. I’ve mentioned in these chambers that we are in discussions. We are working closely with all of the public post-secondary institutions about the employer health tax.
It is premature to assume cuts will be made. We are working with evidence. I’m not sure where the member got the figure of approximately $70 million. It is important in these chambers, especially when we speak to the budget, that we speak to the facts of figures. That is why we’re working with the sector to look at what the implications are going to be, if any.
I welcome more questions to talk about post-secondary education, but it is very premature that there will be any cuts.
S. Cadieux: Well, I appreciate that. I used a rough estimate number, based on what we know to be the salaries that the ministry is responsible for, ensuring the universities have dollars to provide.
Since the ministry has that relationship with universities, the public would expect that the minister would know what the salary budgets of those institutions are and, therefore, could calculate a tax that is being implemented by her government on those institutions, and, at minimum, after this number of months, be able to articulate in this House, in the estimates, what the impact on those institutions will be for the public so they are aware, so they can anticipate, should the minister — or the Minister of Finance, as the minister is choosing to refer to — decide to compensate the institutions, what the impact to the fiscal plan would be, considering it is not currently in the three-year fiscal plan.
I think it is entirely relevant to provide context, but the minister has decided not to do that. So instead, we are using a ballpark figure we estimate, based on the current salary budgets of institutions, recognizing that that is an estimate, because we do not have access to the same information that the minister did and does through the budgeting process and through the Ministry of Finance.
Now, moving on, there’s been a $1.6 million cut to student services. Can the minister specify what programs have been reduced, and what student services are being reduced?
Hon. M. Mark: It was a one-time funding increase in 2017-18 for StudentAid B.C. Our ministry is covering that $1.7 million within our existing budget. It has had no impact on students.
S. Cadieux: I need more clarity on that. The minister says there was a $1.6 million, one-time amount that is being covered by her ministry. Well, if it’s being covered by your ministry, it’s in the budget. And it’s not there. Can the minister please explain what the one-time money was that is no longer there?
Hon. M. Mark: For years, the ministry has covered the $1.7 million within the budget. In 2017-18, there was a one-time lift. In 2018-2019, we went back to normal and are still covering within our budget, which has no impact on students.
S. Cadieux: The government is eliminating the education tax credit, which will save government about $12 million a year. Is that money saved in the Ministry of Advanced Education, or is that general revenue?
Hon. M. Mark: Can the member opposite please explain which tax credit she is referring to, keeping in mind that the Minister of Finance is responsible for tax credits?
S. Cadieux: That I understand. The question was whether or not the savings from the reduction of that tax credit is money that comes back now to the Ministry of Advanced Education. Or is it accounted for in general revenue? Does the ministry see a benefit?
Hon. M. Mark: I believe the member opposite should be referring to the Minister of Finance, who’s responsible for tax credits. She can speak to the tax credit.
S. Cadieux: Okay. But all I’m asking is whether or not, with the elimination of a tax credit that was previously available to students to the tune of about $12 million a year…. Now that the government is no longer offering that tax credit, does the Ministry of Advanced Education see a $12 million benefit, or does that money stay in Finance?
Hon. M. Mark: I would reiterate that the question is best for the Minister of Finance, around the tax that she’s referring to, the tax credit.
What I will say is that there was a lift in this budget of $116 million in operating funding to benefit students and our mandate priorities, such as adult basic education, the tuition waiver program for youth in care, a lift in the first Indigenous law program at UVic. That’s where the allocations of the $116 million have come from in Budget 2018-2019.
S. Cadieux: Prior to the budget, knowing that the tax credit was going to be eliminated for students, did the minister suggest to the Minister of Finance that something should be done to replace that benefit for students?
Hon. M. Mark: Thank you for the question from the member opposite. The Minister of Finance is responsible for the overall budget. Our ministry received $116 million for operational funding to deliver on our priorities and government’s commitments — and $1.2 billion in capital to invest in things like student housing.
We are moving forward in our ministry to deliver on things that students have been calling for, and that is to access an affordable education. They want to access their education and training facilities that are going to give them the opportunity they need to get the learning they need. I was just up at UNBC, visiting the wood innovation lab. Students want those facilities. That’s what our capital budget is for.
The operational is to offer the right programming. And of course, going back to capital, it’s about giving them the training equipment that they need. We are delivering, through this budget, on the priorities that our government has set and responding to the requests of the students.
S. Cadieux: I guess the answer, then, to my question was no, that the minister didn’t advocate for another program for students to reduce the cost of education.
Yesterday the minister announced graduate and doctoral scholarships in the amount of about $12 million. Where in the budget is that money?
Hon. M. Mark: We were able to provide $12 million in one-time funding through Budget 2017-2018 to support 800 graduate student scholarships of $15,000 per award.
S. Cadieux: Okay. This is one-time money out of last year’s budget, and it is not budgeted to go forward. So this is a one-time program for those individuals.
The ministry, along with the Premier, yesterday also announced the B.C. Knowledge Development Fund. What is the source of that $100 million fund? Is any of that within the Ministry of Advanced Education?
Hon. M. Mark: With respect to the scholarships, it’s one-time funding for three years. To the question around the B.C. Knowledge Development Fund, it’s within Advanced Education, Skills and Training’s capital fund, and the program is approved through the Minister for Jobs, Trade and Technology.
S. Cadieux: Back in estimates in the fall, in response to the budget update from this government, we asked about completion grants that the minister’s government had promised during the election. The minister said they’re working towards the completion grants for post-secondary students. “We’re not there yet…but it doesn’t mean we’re not committed.” They’re going to “fulfil our promises.”
Can the minister explain why Budget 2018 chose not to provide any new financial support to students beyond what had already been announced in terms of tuition waivers, the interest rate reduction and the ABE and ELL programs?
Hon. M. Mark: Thank you for the question from the member opposite. I am fully committed to moving forward with the completion grant. It’s in my four-year mandate letter from the Premier, on which we’ve made a lot of progress, as the member opposite noted, around adult basic education and tuition-free or 2.5 percent lower interest on student loans.
Our ministry is currently developing policy and program options for this new grant program, including assessing key considerations such as the program delivery model and timing of the grant funding, as well as eligibility criteria.
As the member opposite is aware, because I’m sure she has met with lots of students, many of the students have said to me that they would prefer to have the completion grant at the front end, which means it’s not at the back end for completion. In fact, our ministry has a number of different program areas where we help with financial aid and aid to students. We are really working very hard as a ministry to make sure that the information is accessible to students around where they can get their financial aid and to make sure that the funding and eligibility criteria are seamless.
We are helping the students in most need, and that really feeds into the pillar of our government’s commitment around addressing affordability. It’s listening to students. As the member opposite is aware, when you’re creating policy, you want to make sure that you assess what you have already — make sure we do our due diligence so that we’re not having overlap and we are addressing those gaps that are really going to benefit students’ bottom line. They are telling me that they can’t even get into school because they feel that it’s a bit out of reach. We want to do anything we can to eliminate those barriers that have stood in their way.
S. Cadieux: The minister last session said there was going to be money to accompany government’s commitment to mental health in the post-secondary sector, but we don’t see any new funding. In fact, while it has now been articulated, the budget for student services is flat. So can the minister tell us how her ministry intends to move forward on mental health plans on campus if there is no money associated with that?
Hon. M. Mark: Again, thank you for the question. When I had a chance to visit all of the 25 post-secondary institutions last July, it was acute. The students made it very clear to me that affordability was an issue, housing was an issue, mental health was an issue and just the cost of getting an education was an issue. That fed into their mental health.
As the member opposite is aware, I follow her on Twitter. I know that she’s engaging with students and that mental health is a very, very serious issue. We’ve got $4.5 million allocated over the next three years. We’re engaging with the post-secondary sector and students around what those options for service delivery are.
Visiting all of those 25 campuses across British Columbia shows us that they’re not all the same. Not all of the campuses are in urban centres, and not all services are the same. There is no cookie-cutter approach to delivering service for mental health, as we’ve learned through our own Minister of Mental Health and Addictions.
We’re engaging, and we are listening to students on what that program delivery is going to look like, along with listening to the presidents and having their understanding of what that program is going to look like — say, at UNBC. I’ve heard from students at UNBC. Some have said that they don’t necessarily want student services on campus. They want services off campus. Students have said to me several times that they don’t want a cookie-cutter approach.
The $4.5 million that is allocated is going to help us get a service delivery program available to students that are saying mental health is a serious issue.
S. Cadieux: A quick question, then. Where is that $4.5 million in the budget? Where would I find that money?
Hon. M. Mark: The money was allocated in the September budget update. It’s carried forward in Budget 2018-19 and is into Budget 2019-20. There is no specific line item for mental health, though, that is shown in this budget, but it is allocated in this budget.
My understanding — I’ve just spoken to my staff that are with me — is that not all programs are identified, just because it would be a very, very thick document to list every single program area.
S. Cadieux: Am I to believe this is one of those investments that we’re just going to find the money somewhere eventually? We’re going to commit to it, but it’s not really in the budget. Or would it come under student services programs? Or would it come under educational institutions and organizations?
Is it in the big amount — and it’s anticipated that it’s in the big amount — which is normally the amounts transferred to universities? Or is it in the student services piece? Or is it one of those things we just hope to find money for at the end of the year?
Hon. M. Mark: It’s under the educational institutions and organizations.
S. Cadieux: Just one final question for the minister. The minister, I know, will be very aware, as she will have heard from students, about the challenge around sexual violence on campus. From her previous role, I know, as well, that she will be very aware of the challenges around violence against women, particularly, and the concerns on campus around that that led to the institutions policy development.
To date, there has been no money to follow the policy, so institutions are expected, at this point, to institute policies related to sexual violence on campus and address that properly and provide services to students through their existing budgets, with no additional allocations.
Does the minister anticipate adding dollars to support this initiative, or is the minister intending for universities to continue to find that money somewhere within their budgets?
Hon. M. Mark: I really appreciate the question from the member opposite. In these chambers, there’s a little bit of push and pull, a little bit of debate. We don’t always agree, but there is one thing that we do agree on, and that’s about the safety of students on campus. We agree that all of our students — our friends, our faculty, our loved ones, the people that go to work, go to school, go to learn, go to teach — should be free of violence. I will say again in these chambers that I commend the leadership, when the members opposite were in government, in bringing forward the law.
As soon as I became minister, I heard feedback about the policy. The policy, some said, didn’t go far enough and wasn’t robust enough. There were still potential holes or gaps. It’s important that we listen. This is a very, very sensitive issue.
I would say four months after becoming minister, which I think is quick, I said: “Look, I want to go out and listen to students.” We heard from people all over the province when we launched a social media campaign in December, and 370 submitted their feedback on where the policies need to go and what needs to be changed.
Again, around the sensitivity of the issue, people don’t all want to access services and programs the same way. Therefore, that has an implication on how and what you deliver. Therefore, when the member opposite asks about costs, there’s no cookie-cutter approach.
I can assure you that we will consider the feedback and any requests for funding implications for the implementation of this policy. I can also assure the member opposite that the presidents take this matter seriously and that they are going to do their part. They’ve assured me that they are going to do their part to support not just students — the students, faculty, and everyone that I’d mentioned earlier who is visiting, accessing those public post-secondary institutions.
Again, thank you for the question. I’m happy to have a further discussion on what that feedback is once we get the analysis put together. Right now we know that where the feedback went, greater awareness in the K-to-12 system, greater awareness in the secondary system so that we can prevent.
The whole emphasis was: prevent, prevent, prevent. So hopefully, we don’t have to pay for programs that respond to sexual violence. The emphasis is really on prevention and awareness — and if you have to call in a service, that that help is there when you need it.
S. Cadieux: Thank you to the minister. I know that she’s passionate about the issue, as am I. I know that there is work underway to review the policies and where things are at. I understand the complexity of implementation of programs and services.
Certainly, I hope that the minister is considering the capacity of the various organizations to do that. While all, I believe, do have the right intention, I certainly don’t think that they all have the same financial capacity or, frankly, knowledge capacity at their institutions to implement the necessary mix of services and supports, both in prevention, which is definitely important….
As much as I think we would all like to hope we could get to the utopia where it would never happen, that we wouldn’t need supports, I know that the member knows that is unlikely and that we want to make sure that those supports are in place and appropriately delivered to minimize trauma and additional distress.
I thank the minister and staff for the answers to my questions this afternoon. I will pass off now to the member for Abbotsford-Mission to continue.
S. Gibson: I’m pleased to be here today with regards to Advanced Education estimates and continuing on from my colleague from South Surrey.
We’ve heard that the minister has a particular interest in skills training — the practical side, as you might say, of our workforce — in her facet of her ministry. I’m going to be asking a few questions, at the start, regarding apprenticeship ratios.
Just a simple question. What are your aspirations for ideal apprenticeship ratios? What are your goals for apprenticeship ratios?
Hon. M. Mark: Thank you for the question from the member opposite. It is a steep learning curve to learn about the Red Seals and the trades and the magic that they do across the province to build our roads, our schools. I am very, very passionate about the trades.
Looking to my mandate letter from the Premier, it is very clear that I have to — I just want to get the correct wording — “work with the Minister of Transportation and Infrastructure to implement effective apprenticeship ratios in government-funded infrastructure projects and increase participation of equity-seeking groups in the skilled work force.”
I will say for the record that apprenticeships are essential to the training for our future construction workforce, and increasing on-the-job training opportunities for apprentices on public projects will create more opportunities for apprentices to complete their training and have meaningful, sustainable jobs. What I keep hearing from the sector is really the importance of having their completion, their Red Seal, and how valuable that Red Seal is.
Our government is investing $15.8 billion in taxpayer-supported capital spending over the next three years. We can maximize the value of that spending by ensuring that the construction of public projects also helps train our future workforce. We believe it’s a win-win. We have been engaging with industry stakeholders to develop ways to help apprentices get the experience that they need to be fully qualified and become certified journeypeople.
For the member opposite, he might want to know who some of those individuals are that we’re engaging. We’ve had numerous discussions and round tables. Clifford White, Chief of the Gitxaala Nation. Jud Martell from the B.C. Building Trades. Tom Sigurdson from the B.C. Building Trades. Lindsay Langill, the Independent Contractors and Businesses Association. Laird Cronk from the B.C. Federation of Labour. Reighardt van Enter, Progressive Contractors Association. Larry Richardson, the Christian Labour Association of Canada.
[L. Reid in the chair.]
Kelly Scott, B.C. Road Builders. Lisa Langevin, IBEW 213, women in trades. Julia Balentyne, Build Together co-chair. Peter Baker, director of the Squamish training centre. Thomas Nyce, Indigenous affairs representative with Ledcor. Margo Middleton, Middleton Petroleum Services in Kamloops. Roberta Ellis, the board chair for the Industry Training Authority. Robert Lashin from Houle Electric. Clyde Scollan from the Construction Labour Relations Association and Tara MacDqqonald, who’s an apprentice in sheet metal.
We’re engaging and coming together to develop a policy on effective apprenticeship ratios.
S. Gibson: I think the remarks are encouraging, but I guess I was hoping for something a little more tangible. The expectation is that these apprenticeship ratios will be implemented in the coming months and years ahead. I guess I would like to know…. My question to the minister is: what are those ratios going to be? What are your aspirations for those? Perhaps I could pin you down just a little bit with respect to an exact date of implementation. I think that would be helpful for the province to hear. It’s indirectly part of your management letter, as I understand it.
Hon. M. Mark: I appreciate the question from the member opposite. We are engaging with the sector to determine what would be the most effective apprenticeship ratio. We are developing a policy, and we’re not going to develop that policy on the back of a napkin. We’re going to do that by engaging with the sector. It is yet to be determined. When we finalize the policy, we will announce that to the public. There is a great deal of interest in what the ratio will be, and there is a great deal of opinion. Not everyone is on the same page. I can assure you of that.
That is about developing policy. Developing policy is about engaging people and having discussions around what will be the most effective ratio so that people succeed. The people at the centre of this policy are the apprentices. The apprentices need — they require; they desire — that hands-on training where they can work towards getting those hours that are going to help them achieve their journeypersons and their Red Seals.
S. Gibson: The monitoring dimension to apprenticeships is identified in the ministry service plan. What is the budget for that? How much money has been allocated for the monitoring? Perhaps it could be explained a little more as to what that entails.
Hon. M. Mark: I appreciate the member is asking a question. We haven’t created the policy yet, but I just want to underscore the kind of rationale and the vision. Before any ratio target number is determined, we need to understand what “effective” means, both to the construction of public infrastructure and, most importantly, for the training, mentorship and safety of apprentices on the worksites.
What the stakeholders have told us so far…. These are elements that we’re looking at when we look at “effective” — what that means. That means enhancing apprentice work-based training, job opportunities and completion, maintaining workplace health and safety, allowing flexibility for employers, maintaining reasonable costs for employers and government, and ensuring fairness and transparency in government procurement. Those are the objectives that stakeholders said that we, as government, should be considering as we create the policy.
S. Gibson: The minister has indicated her aspirations for co-op. This is something I have in common with the minister. I think co-op, when it’s used appropriately, is pretty amazing and has great dividends, especially for our younger workers. The minister indicated that she wants to increase co-op placements, which I think is laudable, but there’s no mention in the ITA mandate letter. In fact, there are no co-op targets mentioned.
Am I assuming that co-op targets have been abandoned? If not, what are they, and what’s the budget for them?
Hon. M. Mark: Just to clarify, is the question about co-ops at post-secondary institutions, or is it about work experience in high school? We just want to make the connection that the questioning isn’t about the trades. Or is it about experience at the post-secondary institutions?
S. Gibson: The minister has identified that she would like to have a formula for how trades seats are allocated. What is that formula, and has it changed at all?
Hon. M. Mark: I just wanted to clarify. The question earlier was around whether I as a minister care about co-ops — that it’s not in our mandate letter. Co-ops are in our mandate letter. It says: “Expand B.C.’s technology-related post-secondary programs, co-op programs, and work to establish technology and innovation centres in key areas of the economy.” That stands as a commitment in our mandate letter.
To clarify, the member opposite is talking about trades seats, which fall under the Industry Training Authority, which is one of my Crown responsibilities. So to the question, in 2018-19, the Industry Training Authority plans to invest about $72.7 million to purchase 27,151 trades seats. This amount is consistent with 2017 and 2018 levels. Funding is provided to 15 public trainers — those are the public post-secondary institutions — and 25 non-public trainers to deliver apprenticeship and foundation training seats.
Funding projections are based on, in the formula, an independent three- to five-year labour market supply-and-demand analysis, informed by the B.C. labour market outlook; past enrolment levels in trades programs at public and non-public training institutions and the current apprenticeship registration levels; as well as, finally, consultations with industry via sector advisory groups in sector round tables. So there is a formula that exists through the Industry Training Authority.
S. Gibson: On another matter, at Thompson Rivers University, there was a program apparently announced, a four-year degree program in electrical, computer and software engineering. Only a portion was approved. I’m wondering when the balance of that will be approved and where the money was allocated that was originally approved for a complete program in electrical, computer and software engineering.
Hon. M. Mark: I had to go through my big table here of where the seats are, the 2,900 seats that our government committed to, to invest in tech. As the member opposite can appreciate, we’ve got 25 post-secondary institutions across British Columbia. It’s an ecosystem. It is important to me that we have training available across the ecosystem and across the region. We continually hear in this House the importance of serving British Columbians, not just in Vancouver, not just on Vancouver Island, not just in the Interior and not just in the north, but having a balanced approach.
With respect to TRU, our government committed to 140 seats at Thompson Rivers University for the first software engineering program to ever be offered at TRU. That is something that they’re very proud of and our government is very proud of.
There is another first: the first civil and environmental engineering program at the University of Northern British Columbia, another first that UNBC is very proud of and our government’s really proud of.
I would just have to say for the member opposite that we’re just getting started. We’re just getting started on injecting in tech, and those 2,900 seats are most appreciated at the post-secondary institutions across B.C.
S. Gibson: When will the other two aspects of the program be added?
Hon. M. Mark: Well, 2,900 seats, $42 million — that’s a pretty significant investment by my determination, and it’s the first significant investment in over a decade for technology and training opportunities for students across British Columbia.
We looked at the entire ecosystem. We worked with the presidents and the post-secondary ecosystem to determine the best locations and program details for the services and courses that they wanted to offer in their backyard. They were fully at the table when we had those discussions.
TRU is very, very proud to be able to offer the first software engineering program in their backyard. Clearly, what we heard at TRU, when I was there for the announcement, is that students want to study close to home and get a job when they graduate close to home so that they could raise their families.
S. Gibson: With regard to compulsory trades, last fall the minister appeared to be hesitant to respond to a query regarding compulsory trades. However, we hear now that government is looking at certain particular trades. I’m wondering if the minister would share her views on compulsory trades and her government’s vision on implementation, if any, of trades.
Hon. M. Mark: You’re right. There are people talking about compulsory trades. Our government has heard a desire to return to compulsory trades. I’ve heard from stakeholders who have concerns about worker safety and opportunities for apprentices and consumer protection.
Our government is committed to completing a review of B.C.’s existing safety and credentialing requirements. We are also reviewing how compulsory trades designations could be used to improve worker safety and consumer protection.
I want to emphasize that it’s important that our trade workers and apprentices are supported while our work sites are safe. My ministry will be working with the Minister of Municipal Affairs, the Minister of Labour and the Industry Training Authority, who I’ve asked, through the mandate letter, to complete this review. A key part of this review will be connecting with employers of trade workers, labour groups and apprentices to ensure their input is included in this review.
We will ensure there is a consistent and transparent approach for system stakeholders to review the information and provide feedback to government. With respect to timelines, we expect the review to be completed in 2018-2019.
S. Gibson: The minister has said that she would not restrict open shops. She was quoted as saying that. Is there not an incongruency between that statement and the one that government is identifying that would contemplate compulsory trades? There seems to be an inconsistency there. Perhaps the minister could speak to that.
Hon. M. Mark: There is no inconsistency. It’s premature to make assumptions on the outcome of the review. The review is underway. As the results are known, we will share the results of the review when it’s complete, in 2018-2019.
S. Gibson: With regard to the sector advisory groups, part of the ITA, the minister is ordering a review of these. Can we assume that the current shareholders, whatever the configuration, will continue to be involved — that the current shareholders will continue to be a part of the process?
Hon. M. Mark: Thank you for the question. It’s a good one, and it’s one that we made clear in the mandate letter for the Industry Training Authority, which specifically states: “Work closely with government to review, align and update the mandate of sector advisory groups and the approach to membership in order to ensure that members have in-depth knowledge of the sector they represent and can provide relevant advice on how to improve B.C.’s trades training system, and that training providers, apprentices and journeypeople are adequately represented.”
The instructions, the requests in the mandate letter to the ITA are to submit recommendations for updating the sector advisory group’s mandates and membership structure to government by September 30, 2018 and, once approved, implement those recommendations by March 31, 2019.
S. Gibson: Is the minister contemplating adding any new sector advisory groups? What are her plans for the LNG sector advisory group?
Hon. M. Mark: Thank you for the question. The sector advisory groups are very important. They play a very important role in terms of giving us input and telling us what the needs of their members are, their sector. They funnel that information through the ITA, through their SAGs, their sector advisory groups.
The review that I have mandated the ITA to go forward with will help inform how we can strengthen those SAGs. We don’t have that determination yet. We’re not going to know until the review is complete in 2018-2019, so I look forward to the outcome of that and, most importantly, making sure that those sector advisory groups are supported.
S. Gibson: A little bit on budget allocation. I know we’re kind of winding down here.
On budget allocation. I think, surprisingly for some of us, there was quite a lot reduced from the labour market strategy and planning budget. That really, often, forms the vision for what we would characterize on this side of the House as part of a jobs plan. That $8 million was removed.
We’re kind of wondering, on this side of the House, what kind of vision you have if that budget was reduced so dramatically. What are the goals now, given that you don’t have that funding in the marketing strategy and planning over the previous year? That would be a question to the minister.
Hon. M. Mark: Can the member opposite clarify, just be a little bit more specific, on what the question is referring to?
The Chair: Member for Abbotsford-Mission, the minister is seeking clarification on your question.
S. Gibson: If I understand the question, you want a clarification, Minister?
I’m advised that there’s a labour market strategy and planning budget, and that there was a significant amount reduced over the previous year. This was what we would characterize on this side of the House as part of the job plan. If that doesn’t meet with your information, I’m happy to research it further, but that amount was fairly significant. It also ties in with a reduction in information systems as well. That, perhaps, will be a reminder about that.
Hon. M. Mark: Thank you to the member opposite for the question. There wasn’t a reduction in Advanced Education’s budget. Programs that the member opposite is referring to were transferred to the Ministry of Jobs, Trade and Technology, which he refers to as $8 million. In Budget 2018, in our budget, it increased by $10 million under the line item “Labour market and information” to support Indigenous skills training.
Noting the hour, I move that the committee rise, report progress and ask leave to sit again.
Motion approved.
The committee rose at 5:16 p.m.
The House resumed; Mr. Speaker in the chair.
Committee of Supply (Section B), having reported progress, was granted leave to sit again.
Committee of Supply (Section C), having reported resolution, was granted leave to sit again.
Committee of Supply (Section A), having reported progress, was granted leave to sit again.
Mr. Speaker: Hon. Members, I am advised that the Lieutenant-Governor is in the precinct. Please take your seats.
Her Honour the Lieutenant-Governor requested to attend the House, was admitted to the chamber and took her seat on the throne.
Royal Assent to Bills
Deputy Clerk:
Community Care and Assisted Living Amendment Act, 2018
Employment Standards Amendment Act, 2018
Miscellaneous Statutes Amendment Act, 2018
Workers Compensation Amendment Act, 2018
Family Maintenance Enforcement Amendment Act, 2018
International Commercial Arbitration Amendment Act, 2018
Tenancy Statutes Amendment Act, 2018
Public Service Amendment Act, 2018
Taxation Statutes Amendment Act, 2018
Energy, Mines and Petroleum Resources Statutes Amendment Act, 2018
Securities Amendment Act, 2018
Motor Vehicle Amendment Act, 2018
Local Government Statutes (Housing Needs Reports) Amendment Act, 2018
Protected Areas of British Columbia Amendment Act, 2018
Insurance (Vehicle) Amendment Act, 2018
Class Proceedings Amendment Act, 2018
Civil Resolution Tribunal Amendment Act, 2018
Public Interest Disclosure Act
In Her Majesty’s name, Her Honour the Lieutenant-Governor doth assent to these acts.
Hon. J. Austin (Lieutenant-Governor): Just before I go, I’d like to say that represents a whole ton of work. I’d just like to thank all of you for your work over the last couple of weeks and to say I hope you have an opportunity to enjoy time with your families this weekend.
There’s been a ton of work going on with respect to the floods, and I’d just like to express appreciation for everybody who has been handling that and working so hard on behalf of the people who are suffering from that situation.
Thank you all, and I’ll see you again soon.
Her Honour the Lieutenant-Governor retired from the chamber.
[Mr. Speaker in the chair.]
Mr. Speaker: Please be seated.
Hon. M. Farnworth: Noting the hour and noting the amount of work that’s done, I move the House do now adjourn.
Hon. M. Farnworth moved adjournment of the House.
Motion approved.
Mr. Speaker: This House stands adjourned until 10 a.m., Monday, May 28.
The House adjourned at 5:31 p.m.
PROCEEDINGS IN THE
DOUGLAS FIR ROOM
Committee of Supply
ESTIMATES: MINISTRY OF FINANCE
(continued)
The House in Committee of Supply (Section A); R. Leonard in the chair.
The committee met at 1:37 p.m.
On Vote 24: ministry operations, $172,581,000 (continued).
T. Redies: Just before the break, we were talking about the impact of falling house prices on government revenue. I think the minister indicated that a 1 percent decline in prices would have about a $20 million impact on the government revenue. So if we were talking about a 25 percent decline, like some experts are predicting, that would have a $500 million impact on government revenue. Am I correct?
Hon. C. James: Yeah, the numbers are right. You have the numbers. But I think you have to also remember, as I said earlier before we took our break at lunch, if you’re looking at simply that number, that assumes everything else remains static. Also, remember that when you’re talking about the property transfer tax, that also takes into account the sales price but also the volume, which again can change those numbers.
T. Redies: Thank you for that answer.
On February 21, you were specifically asked in the scrum, with respect to your government’s intervention in the housing market, if the goal was a decline in home prices. You said yes. You added a further quote: “I hope we don’t see the kind of escalation you are seeing now in the market.” Minister, was your government’s intention to bring about a price drop in the markets, yes or no?
Hon. C. James: I think the member has heard me say this, probably, almost every day over the last couple of months in talking about the comprehensive housing plan. As we said when we brought in the comprehensive housing plan, one of the things we are looking to do is moderate the market. We believe that that’s important. If you take a look at the excessive price escalation we have seen over the last while, moderating that is one of the goals that we have around the housing market.
We are dealing with both supply and demand. As I mentioned earlier, we don’t have, as government, control of all of the tools. There are tools outside of our control — mortgage rates, interest rates — that also have an impact on the housing market. So all of those need to be watched and need to be addressed.
I think the key…. Again, in discussions with folks in the real estate field, one of the big pieces that comes up over and over and over again is the issue of mobility and that a healthy real estate market has the ability for mobility for people in the market. They have the chance, when they are able to, when their jobs change or when they have affordability in their family, to be able to move up or to move to a larger place, to be able to adjust the needs of their family, to meet the needs of their housing.
There is no mobility, particularly in the urban areas that we’ve talked about. When you look at the vacancy rate, when you take a look at the prices in those communities, there is no mobility. I think I mentioned before the meeting of people who have said that they’ll never leave their place even though it may be substandard, even though they feel it’s a place that is a challenge, because they’re terrified they’ll never find anything else.
The goal, again, continues to be not seeing the kind of excessive price escalation but seeing, when it comes to supply in the market, more stock and more mobility for people in the market.
T. Redies: Thank you, Minister, for your answer, but I do want to get a little bit more specific. When the minister says “moderate,” does that mean the minister does not want to see higher price increases, or is it, as she indicated on February 21, that she wants the housing market prices to come down?
Hon. C. James: I think I’ve answered that, but I’ll answer it again. I’m hoping that we see a moderation in the market, that we see more of a range, that we see mobility, that we see the opportunity for people to be able to have housing that meets their needs. So affordable housing, housing that is larger and perhaps has a higher rate for people who are able to afford that. But there is a mobility in the market, and that’s what I’m looking for.
T. Redies: The most recent statistics calculated by the Bank of Canada in 2016 suggested a 15 percent drop in housing prices would put one in eight mortgages in greater Vancouver underwater, and a 25 percent drop would put one in four mortgages underwater.
As we have seen from the devastation in the United States during their housing market correction, it’s not just governments but people that get terribly affected when housing prices start to drop substantially.
It is a matter of confidence. It’s a matter of confidence in the market. While sales might come back at some point in time, there is a trough period where nobody is buying because they’re expecting the housing prices to fall. As a former banker who has seen this, this is a terrible situation to get into for both governments and individuals.
What I would like to ask the minister is: what analysis was done by the Ministry of Finance on this before they implemented the myriad of property taxes? And does it concern the minister that one in eight and one in four British Columbians could be underwater on their mortgage if prices fall by 15 to 25 percent?
Hon. C. James: Perhaps this is just a different view of the approach here. There is no question in my mind…. Yes, I’m an optimist, and I’m also a very proud British Columbian. I think British Columbia will always be a place where people want to live and work.
It will always be a favourable destination for people who are looking for a place to live that has an incredible natural environment, that has natural resources, that is the gateway to the Pacific, that provides the opportunity for people from all parts of the globe to come and live here. So I don’t take the member’s premise around a crisis. I believe that in fact, British Columbia is always going to be a place that people want to invest.
There are so many factors in play. I know the member has heard me say this before, but it’s part of the reason that I’ve said that we needed a comprehensive package to bring forward on housing measures, because there isn’t one measure that is going to solve the problem. And it’s certainly not going to be solved overnight. It is going to take time.
It’s going to take monitoring. It’s going to take, as I’ve talked about before, making sure that we track as we go along, as we implement the measures in our 30-point housing plan. It is going to take time. As I said, we’re not going to see, I don’t believe…. A few changes in the short term.
In the long term, from my point of view, if we don’t address this housing crisis, if we don’t address the challenges that we’re facing, then we in fact will harm the economy. We will see the kinds of challenges that other jurisdictions have — where investment takes a look at other places where it’s possible for them to recruit and retain employees. From my perspective, bringing forward these housing measures is exactly what’s needed to look at long-term sustainable growth for British Columbia.
T. Redies: I appreciate and I believe what the government is trying to do. I understand there is a concern around the housing market. What I am saying is that we have to be very careful, with the intervention that governments are taking in the housing market, that we don’t precipitate a much steeper fall with a longer trough.
I’d just like to add to this that whether you’re in North America or Europe, housing markets generally go in seven-year cycles. We’re in, I think, a 12-year cycle at this point in time, so there’s a high risk of a market correction in any event. My worry is that this government, with its collection of property taxes, is actually going to create a steeper decline and a longer trough for us to come out of this, and this will hurt many British Columbians.
My other worry…. I respect the fact that the minister has been very focused on dealing with the housing crisis, but there seems to have been little or no analysis done, with respect to the impact on British Columbians, on the myriad of these property taxes.
We had a spec tax that wasn’t supposed to affect British Columbians but is now affecting British Columbians. We have little or no analysis on the impact on British Columbians if we have a significant correction in the housing market. One in four British Columbians could be under water on their mortgage, which is a very serious situation.
I hope I’ve made my point there. I’d like to turn to another aspect of the housing market that is giving me, certainly, cause for concern, particularly when we have a government that’s talking about creating affordability and supply.
Sales in Metro Vancouver, as we talked about earlier, hit a 17-year low in April 2018. More specifically and a leading indicator on what’s going on with the housing market, presales fell to 43 percent in April after being at 94 percent in January, 83 percent in February and 63 percent in March. They are in a precipitous drop. This slowing in the presale market is very problematic, because bankers require, typically, 60 to 70 percent presales in order for developers to get financing.
Minister, with this type of drop, are you not concerned about the impact on the supply of housing in British Columbia, when developers are getting to the point now where they may not even be able to get financing for projects?
Hon. C. James: I have a few different stats to share with the member. The first piece is just our economic analysis that continues to look at economic activity in British Columbia — looks at a number of indicators, obviously, each month.
One of those key factors we look at are housing starts. In April, B.C. housing starts have averaged 42,143 annualized units year to date, April 2018. That’s an 11 percent increase compared to the same time in 2017, the first four months of 2017. Year-to-date activity is above the 2018 budget forecast of approximately 32,000 units in 2018. In fact, it’s in line with last year’s annual housing starts of 43,664 units, which was the highest level ever recorded. So it’s continuing on.
Then statistics from the Canada Mortgage and Housing Corp…. This report came out in May, just a week and a half ago, and it speaks to both Vancouver and Kelowna. Housing starts in Vancouver, in the metropolitan area — so this is the broader area — “continued their strong trend throughout April. Year-to-date starts were up for both single and multifamily units as builders continued to maintain a high level of construction in response to high demand in the apartment and condominium markets. The city of Vancouver and the North Shore have seen the strongest activity so far in 2018.”
Then Kelowna — again, the Canada Mortgage and Housing Corporation. Housing starts activity in Kelowna “picked up significantly” in the month of April, particularly in the multi-unit segment. The recovery in housing starts activity rivals the record seen in 2017 and was the result of large apartment rental and condo projects that are underway. It also states: “Multi-unit housing demand, both rental and ownership, remains strong in the Kelowna” area, and vacancy rates remain low.
The Chair: A reminder to members to address the Chair, please.
T. Redies: Thank you, Madam Chair, and through you to the minister: thank you for that comprehensive answer.
Having said that, what I was speaking about was presales, which are a leading indicator. The minister is talking about starts that are already underway, projects that have been approved. As we know, in Vancouver, it takes anywhere from 28 months to 60 months to get projects approved. These are projects that have already been approved, have already got their presales. What I am talking about are the new projects where presales are precipitously dropping.
Again, it’s not just myself that is concerned about this. On May 9, the BIV stated: “High-profile real estate developers, marketing executives and real estate agents are bracing for a sustained downturn in the housing market after sales in April, usually one of the most active months of the year, plunged by double digits across Metro Vancouver.”
How much of the government’s budget is attributed to the real estate and the construction market in B.C.?
Hon. C. James: One other stat that I think is interesting — and then I’ll get to the issue of real estate and GDP — that the member may be interested in is building permits. Building permits in the first three months of this year compared to the same time last year — so again, using those constant comparisons — have gone up 31.1 percent. Again, I think that shows the kind of strength we’re seeing.
On the percentage of the economy — real estate. Again, it depends on what you include in the calculation, but the usual things that are included would be construction, real estate activity, lawyers, engineers — those kinds of things. It’s a range, depending on which economist you’re talking to. Again, S&P, for example, which does our ratings, uses 12 percent. Others use 24 percent. So we use the range of between 12 and 24 percent of GDP.
E. Foster: Minister, we’ve had this conversation quite a few times, but to put it on the record: on the third of April, the PST department sent out a notice to the gravel industry and other trucking industries regarding PST on trucking. Unfortunately, they sent it out on April 3, and it was retroactive to April 1. So the companies had no opportunity to prepare for this.
The problem, as I’ve brought to your attention, is the unfairness of this, as it goes across all sectors of the trucking business. The people in the gravel pit and trucking industry will have to charge PST on their trucking, whereas the independent truckers don’t. They don’t even have PST numbers.
The big concern, of course, to the people in the industry — in the gravel pits, the suppliers and so on — is that they’ve bid large contracts, multi-million-dollar contracts, with governments — provincial and local and, to some degree, the federal government. They do those a year or ten months in advance and put the prices on them. Now they’ve all of a sudden got an extra 7 percent that they’ve got to add to the trucking fee, whereas the independent truckers don’t. They’re not on a level playing field.
My question. I brought this to your attention some time ago, and we’re not seeing any change in this. It’s most unfair. My suggestion, of course, is to stand the whole thing down until you can make it fair. I just wondered. I want to get it on the record, and I want to know where we are with that. What kind of progress have we made in it?
Hon. C. James: Thank you for raising the issue. I think, as we had that discussion at the time, as I talked about, the government did put in place a remission order up to March 31. But I think I would agree with the member that it doesn’t solve the issue. It doesn’t solve the question that’s out there.
We took the opportunity of following up on the information the member had provided — and on issues that had been raised with us, as well — to meet with the industries. We’ve met with the cement industry; we’ve met with the trucking industry. There are a number of groups that have concerns on this. We’ve agreed to meet again with them. We’re doing some more work to see how we can resolve some of the issues that they’ve raised. So it’s in progress. I guess that’s the best way to describe it.
E. Foster: When I get back to my constituents that are in the business, what kind of timeline can I give them on this? Either they’re going to have to eat the 7 percent hit, or they’re going to have to go back to cities — and, in some cases, to the province — and add additional costs to their contracts. They might lose those contracts or they might be put back.
Hon. C. James: I recognize the urgency. That was expressed to us in the meetings that we had last week and a couple of weeks ago. Certainly, it is our intent to resolve it as quickly as possible. I don’t want to give an exact date, because of the changes that may be needed and to make sure that we have the time to be able to make changes that may be needed if there are changes that have to occur. But I certainly hope to have it resolved before the summer.
S. Furstenau: I have a question for the minister, specific to an organization in my riding called the Cowichan Bio-Diesel Co-op, which produces biodiesel from 100 percent waste oil from local restaurants. The question that’s been raised several times to me is about the carbon tax being applied to biodiesel. This seems like a disincentive to something that is actually a solution to reducing carbon: using waste oil, rather than diesel or gasoline, in cars.
I was wondering if the minister would be able to give some input on this and whether or not we could see the carbon tax actually removed from biodiesels.
Hon. C. James: Thank you for the question. This is something that has been worked on, has been looked at and, I think, needs to continue to be looked at. I think the challenge that is faced with the issue of biodiesel is that biodiesel gets mixed with diesel. It’s hard, when you’re looking at putting a carbon tax on diesel, to know the percentage of biodiesel or diesel that’s being used. How do you, then, set a rate for that kind of mixed fuel? I guess that is the best way to describe it. That’s part of the challenge that’s being looked at.
The previous government actually dropped the carbon tax rate on diesel by 5 percent to recognize 5 percent biodiesel, which was being used as a mix, to be able to try and address some of the issue around encouraging biodiesel to be used. I think it’s an interesting issue. That may be another way of looking at it. As we look at increases in the carbon tax, it may need another look to see if the rate needs to be lowered, or to see if there’s another incentive that needs to be offered. I’m happy to take a look at that idea as well.
S. Furstenau: Thank you for that. That’s really helpful. In the case of biodiesel, the cooperative up in Cowichan does one 100 percent biodiesel option. It’s not mixed with any diesel. It’s actually completely created from waste vegetable oil. I think if it’s possible for the minister and the ministry to look at that as a particular part of this equation….
Hon. C. James: Yes, I’m happy to take a look at that and get the specifics. That certainly makes it easier, if there’s one fuel and not two fuels to take a look at. So we’ll take a look at that.
S. Bond: Thank you to our colleagues for their questions. We’re happy to be able to fit them in.
We’re going to move on to another tax. I guess there are so many taxes and so little time. We’re going to try to work our way through them. I’m wondering if the minister could provide us with the mandate for the MSP Task Force.
Hon. C. James: It’s a very simple, straightforward mandate. The task force was given a mandate to provide advice on when to reduce the MSP premiums and how to replace the forgone revenue.
S. Bond: I’m sure the minister will be able to confirm that she received an interim report on February 1 from the MSP Task Force. You can imagine how, first of all, the task force must have felt — but probably, people who provided input as well.
The task force provided a series of recommendations to the minister about the gargantuan task of trying to replace the forgone revenue from MSP premiums. The first recommendation that the task force made to the minister, prior to the budget being tabled, was: “Whatever mechanisms are chosen to replace MSP revenue, we feel strongly that there should not be any phase-in of the new measures and a phase-out of MSP. Rather, we suggest that MSP be eliminated at a specific date and that the new revenue measures take effect fully at the same time.” Why did the minister choose to ignore that advice?
Hon. C. James: I think the member will certainly know this. I’m sure, as minister, she had various task forces or committees who took a look at bringing forward advice. Certainly, we go through that, and the Minister of Finance goes through that each and every year with budget consultations through the Select Standing Committee on Finance. I had the good fortune to sit on that in opposition for a number of years and know that there were some amazing recommendations that came forward, and that’s part of doing consultation.
Part of putting a task force together, as well, is to get those recommendations. Then the job for government is to decide which recommendations or what direction the government is going to go in. It’s the government’s job to make the decisions. There were parts of the recommendation and some areas that we felt were areas that we were going to take on and other recommendations that we didn’t.
One of the other examples would be the premiums. The task force recommended to look at an income-based premium on individuals. We felt we had already looked at a tax increase for high-income earners in September’s budget, and so we didn’t include that as part of the direction.
Very good work was done by the task force. I have had great conversations with the people who sat on that task force. It is their job to bring forward recommendations, and it’s the government’s job to make the decision.
S. Bond: That’s not the only advice that the minister ignored from the task force. We’ll ask a little bit about timing recently, because I am also familiar with how budgets are built. This interim advice was received on February 1. I can’t imagine that the Finance Minister will attempt to have me believe that the employer health tax was determined just a few days before the budget was actually tabled. Or maybe it was. They asked for advice, tabled the interim report as provided, and the advice was ignored.
Let’s look at the third recommendation. There’s a second one that talks about making sure there is reasonable notice. The minister believes she has given reasonable notice. I would suggest that many employers in British Columbia will never feel that they were given reasonable notice, but let’s look at recommendation 3: “The amount of revenue to be replaced, approximately $1.3 billion,” and I’m quoting the report, “is a sizeable amount of money. Our analysis to date of the available options makes it clear that no one option is preferred, based on the principles we were asked to assess the options against. Therefore, we feel it is important the revenue be replaced by a combination of measures in order to best mitigate the negative impacts of each.”
Why did the minister choose to ignore the fact that the recommendation from the panel that she herself selected was that it would be inadvisable to look at one measure to capture the revenue?
Hon. C. James: First, on the notice. The member raised the issue of reasonable notice. Certainly, we believe, a year…. I think the member is right. There are people that certainly aren’t ever going to be happy with changes, but I think giving a year’s notice was a reasonable notice.
The second piece, just back to the task force and putting in place task forces. I think it’s part of the reason that we look for recommendations, because it’s government’s job to make the decisions. And while there are some examples of governments accepting all the recommendations that come forward, there are often times — in fact, I would say, in most cases — where government will accept some recommendations and not others, where government will take parts of recommendations, where government will thank groups and organizations for the work they’ve done in bringing forward recommendations, and go in a different direction.
I think it’s important to note that that is the job of putting together task forces or committees or doing consultations. It’s to get all of that information, make sure that you’re well informed and then make the decision that you believe is right, as government, which is exactly what we did.
Then the last piece I just want to touch on. The member mentioned the recommendation around using a variety of tools. In fact, as government, we had already moved, in September, on the issue of the high-income earners and bringing resources in from the high-income earners. This was a tax break that was rolled back by the previous government. They gave a tax break to the top 2 percent of income earners. We removed that and felt that people at the top could afford to contribute. I think it’s important to note that that action had already taken place in the September budget.
I think the second piece is it’s important to recognize that the amount of money coming in from MSP is $2.6 billion and the amount coming in from the employer health tax is $1.9 billion. So we’re, in fact, not recouping all of the resources. Again, if we’re looking at bringing in all of the money from the MSP in a variety of tools and using a variety of measures to do that, we aren’t, in fact, bringing in all of the resources from the MSP.
We felt that it was reasonable, as other provinces have done. And I think this is the last piece I’ll just mention on this issue: the fact that payroll taxes have been utilized by other provinces across this country, rather than medical services premiums. I think there are few people who would look at the MSP and presume that it is a good tool for any government to utilize, when you look at the regressive nature.
We had a discussion earlier about regressive and progressive taxes. It’s very clear, when it comes to the MSP, how regressive it was and the challenges that that created. Whether you made $50,000 or whether you made $500,000, you, in fact, paid the same in MSP premiums — a very difficult tax from that perspective but also a very difficult tax to be able to administer.
I heard that from employees and employers. And I know there wasn’t an MLA in this Legislature who wasn’t faced with the challenges of trying to manage the MSP and trying to manage people who leave a job and move to another job and can’t get their medical services premiums in place because one employer paid them and one didn’t. So removing the MSP, from our perspective, was a priority. As the members know, we made a commitment to eliminate MSP premiums within our term, and we felt that this was the budget to announce that in.
S. Bond: Just to clarify with the minister, we’re not arguing whether or not the MSP tax was regressive. What we’re arguing about is who is going to be forced to pay for it. We’re arguing about the continual description by this minister that she is eliminating the MSP premiums. Technically that’s correct, but it is being replaced with another tax.
In fact, recommendations weren’t the only things that were in the interim report. There was actually a warning to the minister. Again, I’m going to quote that to the minister, because I certainly agree that when ministers receive information, they do listen, pick and choose.
This was a handpicked task force with exactly the purpose of trying to figure out how this government was going to close the funding gap related to MSP premiums. They report on February 1, provide three recommendations and some significant insight into what the impacts of looking at a payroll tax might be, and the minister simply dismisses it as: “Well, we had to make the decision.”
Let me quote what the warning said in the interim report of the task force. “A payroll tax would have the advantage of raising a portion of the revenue from all businesses, not just those that currently pay employees’ premiums voluntarily as an employee benefit.” Well, think about that. The minister, while talking about how she’s eliminating the MSP premiums, has decided to download that cost on all British Columbia businesses, whether they were paying MSP premiums or not. So for those businesses, this is a new tax.
Let’s look at the next sentence in that paragraph. “A payroll tax would reduce the competitiveness of B.C. businesses at a time when they are facing several competitiveness challenges, including expected increases to the minimum wage; CPP increases; and recent tax reform in the U.S., which would improve the competitive position of many U.S. businesses.”
To the minister, before she announced that she would replace the MSP premiums with a new health employers tax, did she contemplate the impact of competitiveness on B.C. businesses?
Hon. C. James: I think it’s important to read the next sentence that was in the paragraph the member read from the letter from the task force, when they were talking about the recent tax reform in the U.S. They also stated in the next sentence: “On the other hand, small businesses in B.C. are benefiting from both the federal and provincial reductions in the small business rate. These considerations should be taken into account….” In fact, that’s exactly the kind of approach that we took when we built the budget, both the September budget update as well as the budget in February — how we could provide that balanced approach.
Yes, as the member has acknowledged, we are eliminating medical service premiums. And yes, we are implementing an employer health tax, as other provinces have done, to ensure that we bring in the resources for the health care system, because that’s also a critical piece.
The member asked whether we took a look at competitiveness or support for businesses. Yes, we certainly did. We believe that’s important. That’s why we provided the balanced approach in the budget — half a billion dollars, in fact, between the September budget and the February budget in support for business, everything from reducing the small business corporate tax rate, mining flow-through tax share credit, eliminating the PST on electricity, interactive digital media tax credit, expanding and extending the scientific research and experimental tax credit. Those add up, in fact, to half a billion dollars in support for businesses.
Yes, we believe we are providing that support. I think it’s important to state again that we are not, in fact, bringing in the same revenue that was there for the MSP, so the amount that we’re actually recouping is less. That, again, is providing support in British Columbia to individuals, who obviously were paying MSP, but also to businesses who have been paying MSP as well.
Finding that balance, finding that approach where we continue to remain competitive, we continue to ensure that we have resources for health care…. A basic building block of services and supports for individuals is critical. And getting rid of a regressive tax and looking at a more fair tax system…. That is part of my mandate as Finance Minister, a more fair tax system for British Columbia. We believe that this was the best route to be able to move ahead.
S. Bond: I can assure the Finance Minister that there are literally thousand of businesses, organizations across British Columbia that hardly feel this is a balanced or fair approach.
Let’s just summarize where we’re at so far when it comes to the tax plan that this minister introduced. We have a speculation tax that is an asset tax and is actually impacting British Columbians more than any other “speculators.” We have a school tax that is funding affordable housing.
The minister committed to eliminate MSP premiums, but in fact, she is replacing the MSP premiums with a payroll tax. She ignored the advice of the MSP task force and, in fact, is expanding the tax to all businesses in British Columbia, whether they paid MSP premiums or not.
Perhaps one of the most egregious complaints that people have is that this minister is double-dipping. In fact, the report specifically said: “Do not phase this in. End it on one date, and begin the new tax measure.” Nope, not what this Finance Minister decided to do. In fact, employers will be forced to pay both MSP premiums and a new employer health tax in the next year. In addition to that, we have the ignored warnings about competitiveness. This minister just moved ahead.
I have one other question about just the context of this tax, much less the impact it’s having. I can assure the minister I am sure that every MLA in the Legislature is hearing about the lack of fairness for non-profits, for public sector organizations.
Let’s just look at one last piece of the puzzle. When the Premier was asked about the tax agenda of this government…. He was asked, and the reporter said: “Are the tax increases in your platform the only tax increases in the first term of an NDP government?” The Premier responded: “That’s our expectation. That’s what was in our platform.”
Let’s be clear. This tax was a complete surprise to businesses across British Columbia. What happened between the Premier’s comments that only the taxes in the platform would be the ones that this government moved ahead with until surprise, on budget day, businesses finally figured out that they were going to be on the hook for the financial gap that the elimination, according to the minister, of the MSP premiums created?
Hon. C. James: There was a lot to unpack there. I’m not going to go over all of the disagreements that I have with the way the member has portrayed the issue. In fact, I’m very proud of the direction that we took in this budget. I’m very proud of the direction and the balanced approach we took in investments for business as well.
Yes, we are looking at, as I’ve said often, an employers health tax to ensure we bring in those resources for health care. I think it’s important to note that, yes, there are some businesses who will pay more because they weren’t contributing to health care. But the businesses that were, in fact, are saving 50 percent of their medical service premium costs in 2018, 50 percent of their medical service premium costs in 2019 and a complete elimination in 2020. So in fact, it does provide exactly that balance. It does provide exactly that approach.
The member mentioned surprises. Well, I have to say that as Finance Minister, one of the biggest surprises in opening up the books was the challenges of ICBC and trying to find, in late time…. A $1.3 billion deficit to all of a sudden have to be built into the budget created all kinds of challenges when it came to the budget.
I believe the fact that we were able to balance the budget, that we continue to build in prudence, that we continue to provide support for families when it comes to affordability and that we invested for businesses and provided that kind of support — as I mentioned earlier, a half a billion dollars in support for businesses — shows the kind of balanced approach that we brought forward and will continue to bring forward as a government.
A. Weaver: I have six short questions to pose to the minister on this theme that’s being raised by the member for Prince George–Valemount and the member for Surrey–White Rock.
The minister has chosen to eliminate MSP premiums, which, of course, we support, because we, frankly, also had it in our platform. But she has chosen a way to do this which is through a payroll tax. Again, we support the government’s intention of doing it. It’s not what we would have done. We recognize we can agree to disagree.
Our approach would have been to mirror more what was done in Ontario, through the creation of a health care premium that was progressive and actually person-based, which would allow people to still recognize that there is a cost to health care. They’ll see it on their pay stub, etc. Again, I recognize that government had different priorities or ideas here.
With that said, I’d like to ask a couple of questions, because there is definitely some concern out there within the employers of non-profit, local government and school board sectors, as well as small business and other business. Some of it is not well grounded. I have some troubles with some of the estimated property tax increases that I’ve been seeing coming from municipalities. It suggests to me there’s a property tax gouge that’s going on there that actually is not representative of how much the real cost would be for their employees to….
With that said, I have a couple of questions. They’re with a focus on the MSP Task Force. The MSP Task Force was due to give its final report to the minister just a few weeks after the budget. My first question is: why did the minister make the significant decision that she did with respect to the payroll tax prior to the MSP Task Force reporting in?
Hon. C. James: Thank you to the member for the question. As has been described, I received an interim report. The member asks why we didn’t wait for the final report.
In fact, in putting together the budget, when we were taking a look at both the challenges and opportunities that were there, one of the challenges, as I mentioned earlier, that I was faced with that was not expected — to be in this kind of severe situation — was the issue of ICBC and the deficit at ICBC. So when we took a look at building the budget, we felt that this was the time to make the decision around both the ICBC issue and moving towards the MSP.
The other thing that was very clear — the task force certainly raised this issue as well — was the urgency for people to know that MSP premiums were going. That was a very clear message. There were seniors groups and other organizations that had come forward to talk about the urgency of finding the time to…. “Let us know when they’re going to be eliminated. We know you say you’re going to do it by the end of your term, but we really are interested in making sure that we know a date so that we know it’s going to be gone so that we have the time to plan but also that we know that commitment is there.” So it was also taking into account the urgency of people who really wanted to know.
It was the possibility, then, of looking at our three-year budget term and being able to do the planning that was necessary.
The member mentioned the issue of not-for-profits and school districts. As the member knows, I think, those issues are still being discussed. We’re gathering data. I think it again points out…. We talk about getting information in government. I think we’ve had this conversation on a whole range of issues, mostly in housing.
It’s pretty obvious, across the board, that more information is needed for groups and organizations like not-for-profits to be able to gather the data that’s needed around everybody’s individual circumstances. So we’re finalizing that, and I certainly hope by summertime to have those issues resolved.
A. Weaver: Thank you for the answer.
My question, then, is…. If, as alluded to there, there was a budgetary shortfall because of ICBC, surely that would have been realized early in the term of the government. My question: why did the government not then simply go to the task force and ask them to expedite their review so that they could provide the minister the recommendations that she needed prior to her making a decision, in light of the fact that…? I understand that no such request was actually given.
Hon. C. James: In discussions with the task force and their discussion about the pieces they were continuing to work on…. They’re continuing to work on a number of pieces that they wanted time to complete and that, certainly from my perspective, I felt were worthwhile. So I did ask them to continue to do a final report. I felt that that was worth looking at. There are, obviously, future budgets to come, and there may be some really good ideas and good approaches that might be worth looking at and considering. That’s why we got an interim report from them and why I asked them to complete the final report.
On the ICBC, I have to say that the situation was deteriorating much more rapidly than I think anybody imagined — certainly more than the minister of ICBC imagined and certainly more than I, as Finance Minister, imagined. That created a real challenge when it came to the budgeting.
A. Weaver: On this final report, I have two questions that I’ll put into one here. In the budget, and just now, the minister stated that the task force would still complete their final report and that she was looking forward to receiving it.
My questions, in one, here are: what did the minister direct the task force to look at for their final report, given that she’d already made a decision to implement the employer health tax? Secondly, has she received the final report? If so, when will she release it?
Hon. C. James: The task force, in the discussion we had around the interim report, said that they were still working on a few pieces. I know, certainly, that one of these is an issue that has come up, around the Select Standing Committee on Finance, for a number of years, which is the issue of a tax on sugary drinks. That was one of the pieces that they were interested in finalizing some work on. As I said to them: “Finish up the work that you’re doing, and bring it forward as your final report.”
The other piece that they were wanting to look at and that they’d started some work on but wanted some more time to look at was the issue of the homeowner grant: was there an opportunity, with the homeowner grant, to look at some more progressive kinds of changes to the homeowner grant? Again, I said that I certainly expected that would be interesting to be able to review. So that’s another piece that’s coming.
I expect to receive…. I’m hoping to receive their final report shortly. Yes, it certainly will be public, once I receive it as minister.
A. Weaver: Thank you to the minister for a very helpful response. It actually dealt with one of my further questions, which was with respect to the issue of taxing sugary drinks, which I know the MSP Task Force had talked about considering in their interim report. I look forward to them providing more information in the forthcoming report and to see how the government responds to that.
My final question, then, is again with respect to the MSP Task Force. In the report, they specifically said: “We are leaning towards a combination of a personal income tax surcharge, a small payroll tax and…additional ideas.” The additional ideas, as was mentioned, were like a sugary drink tax…. They said: “A payroll tax would reduce the competitiveness of B.C. businesses at a time when they are facing several competitiveness challenges.” This concern about the competitiveness of businesses partly informed why the task force was not leaning towards exclusively a payroll tax but towards a combination of measures to make up the revenues.
My question finally to the minister, why did she choose to implement a payroll tax, rather than go the route recommended by the MSP Task Force, which would have spread the burden of the tax across a variety of areas?
Hon. C. James: We had a little bit of discussion on this earlier, but I think it’s important to state again, as the member mentions, that the task force recommended looking at personal income tax and a payroll tax, as well as other measures that they’re still going to bring forward.
On the personal income tax, we had made a change, as the member knows. As government, we made a change in September’s budget on the high-income earners, on the income over $150,000, and had taken away the tax break that the previous government had given. We felt we had already impacted and made a difference around the personal income tax. That was a piece that we had already moved on, in the September budget.
The other piece that’s important to recognize is that we aren’t actually recouping all of the MSP revenue with the payroll tax. We aren’t actually collecting the magnitude of the MSP. The MSP is at $2.6 billion. We’re bringing in $1.9 billion on the payroll tax. I think that’s another important piece to recognize and to look at when we’re looking at a payroll tax. It’s not actually looking at recouping all of the resources that were there, so we felt it was reasonable to do it as an employers health tax.
T. Redies: As we’ve been talking, this latest tax-and-spend budget introduces a new payroll tax on B.C. employers with payrolls over $500,000. In three years, this new tax is going to extract a whopping $4.2 billion from employers in this province, including, curiously enough, the public sector.
Can the minister advise us how much of this payroll tax is coming from businesses, how much is coming from the public sector, and how much is coming from charities and non-profits?
Hon. C. James: The member certainly knows — because I’ve been asked this a number of times — that we are continuing discussions with school districts, with charities and not-for-profits, around the payroll tax. The details around how the total resources, the $1.9 billion that we’re bringing in, will be divided up, will be coming when the details have been finalized with those groups and organizations.
T. Redies: That’s a very curious answer. How could the minister put forward an amount of $4.2 billion without any numerical basis to it? That just does not make sense. I’m sure the Ministry of Finance is better than that.
Hon. C. James: I’ve answered that question.
S. Bond: In fact, the minister hasn’t. There are budget numbers contained in the budget book. I’m assuming that the Ministry of Finance and this minister looked at each sector and attempted to sort out how much of this budget is related to each sector.
To the minister: we’re going to go through every sector here, and what we would like to hear is what the anticipated revenue targets…. We know that the minister is contemplating who’s going to be in and who’s going to be out, and we’re going to ask those questions too.
I have a feeling the minister and her team might already have some sense of who may well be eliminated from this tax, but there must be modelling. If there is a budget number in this book, somebody must have said the public sector is going to be responsible for this much, municipalities….
We would appreciate it if the minister would start to have her staff look up the numbers that relate to every sector that generates $4.3 billion of revenue over the next three years. I’m sure it is not a guess. At least, I’m hoping not.
Hon. C. James: The data points that were utilized, when you take a look at putting together the employers health tax, were the employment by sectors. So this is StatsCan data that looks at the employers employment and employers by sector.
What it doesn’t break out…. And this is part of the reason that we’ve taken the time to make sure that we’re looking at the not-for-profit sector, the charity sector, etc. It doesn’t break it down by not-for-profit, by government, by private sector. It simply looks at the sector and the employment by sector. It gives you the size of payroll of various groups in that sector, but it doesn’t break it down.
That’s precisely the work that we’re doing now. Certainly, we can provide the data around each of the sectors. But it does not break it out, if that’s what the member is looking at.
That’s precisely the work that we’re doing now and precisely why we’re taking the time to make sure that we do that division, because it is, in fact, not broken out by sector. That’s important for us to know when we’re looking at making the final decisions about whether there are going to be supports for various parts of the sector. That’s exactly the work that we’re doing.
[R. Glumac in the chair.]
S. Bond: Thank you, I think, for that answer. Can the minister not tell us today what revenue she expects to collect from the SUCH sector as a result of imposing this tax on them?
Hon. C. James: The SUCH sector is a good example of exactly the kind of information that we are collecting, because when you take a look at the SUCH sector, for example, there is not good data around who pays what when it comes to medical service premiums, for example — which groups and organizations pay all of the MSP, which groups and organizations have a portion of the MSP.
Obviously, when we are taking a look at whether supports or additional supports are needed during implementation for those groups and organizations, we need to take into account the 50 percent that they will be saving this year, the 50 percent they will be saving next year — which groups are saving and which aren’t based on their contracts, based on individual decisions that have been made by boards, by agencies, by organizations.
That is precisely the reason we are taking the time to gather all the data and make sure that we have all that information to make the best decision around the groups and organizations that may need support with the employers health tax.
S. Bond: I can honestly say that we are sitting here in confusion. The minister put $1.9 billion in revenue in the budget. Where is it coming from, and how was that number determined? How on earth did the minister come up with $1.9 billion when today she can’t tell us who is paying it, how much they’re paying, which sector, which organization?
A tax was announced, which has caused chaos and concern in British Columbia, and this minister cannot tell us what one — we’ve just started with the SUCH sector — will end up having to contribute to her $1.9 billion of revenue that she put in the budget. British Columbians should start to be concerned about the credibility of this budget if the minister cannot tell us how these sectors, after having this tax applied, will come up with $1.9 billion.
The other concern we have now is that we know the minister is considering who’s in and who’s out. So is the $1.9 billion the final outcome, the final number that the minister needs to plug in, and it will just be spread over a smaller group of people? That will cause a major concern for the businesses who are making some assumptions.
We are trying to figure out how this minister put a budget together, added $1.9 billion, and today she cannot tell us how much she expects to receive from even the SUCH sector, much less the non-profits, the municipalities and everyone else.
Hon. C. James: We’ll begin with the $1.9 billion. So how was the $1.9 billion determined? As I mentioned earlier, taking a look at StatsCan data, you take a look at the total payroll across the province. The payroll tax will apply to all sectors. The members have heard me say this over and over again: the payroll tax will apply to all sectors. So we looked at the total payroll across the province, the employment data. We excluded small employers’ payrolls, small payrolls — as the members know, $500,000 and below. So that has been excluded. That gave the $1.9 billion.
If there are groups and organizations — as we’ve talked about, these include groups like school districts, universities, charities and not-for-profits — that may need support over this time period, we’re looking at that now. That’s the breakdown that I talked about that we’re taking a look at and gathering the information by sectors. How do you divide out the employers? And that’s why the members can look in the budget. They can see the large contingencies built into the budget — $550 million this year, $750 million next year and $750 million the year after. There are opportunities to be able to address supports if needed. That’s why contingencies are there, to be able to address those kinds of supports.
But we need to ensure that we have all the information, particularly the information around the issue of medical service premiums. I think if the member had ever, in government, tried to gather data around the medical service premiums, they will know the frustration — being able to try and get good data that shows which employer pays what, who has what kind of contract in place, what dollars have gone out in what year, different fiscal years for groups and organizations.
That’s the kind of information that we’ve been working on for the last number of months. As I’ve said in the House, we will be able to make those announcements shortly, and we’ll be able to then put all the specific numbers out.
T. Redies: As somebody who’s worked on budgets a good part of my career, this explanation is extremely curious. It’s not clear now if the minister had intentions to go out and tax charitable organizations, not clear if she hasn’t had intentions to tax the SUCH sector, the universities. I guess I question: why go out with a revenue number? Why go out with a half-baked tax when you don’t actually understand the numbers, when a few months of additional analysis by your staff could have reduced a lot of anxiety and chaos?
We know that universities are cutting their budgets now because they cannot run a deficit. So I just can’t understand why the minister and her staff didn’t take the appropriate time to design this tax in a way that would not cause chaos in the economy.
Hon. C. James: If the member has a specific university that is looking at cutting their budget, I’m happy to have conversations with them. In fact, we’ve met with universities. We’ve talked with school districts. We’ve talked with the not-for-profit and charity sector. They know these pieces are being discussed. They know these pieces are coming and that the data is important. The data is data that they collect and that they hold. That’s why we’re working through it.
It’s different in each group and organization. It is different in each university, in each school board. There are different contracts in place. There are different agreements in place around MSP. It’s important, again, as I said, to remember that many of the groups and organizations we’re talking about pay MSP. So there is a 50 percent savings that has to also be taken into account for this year. That’s exactly the work that’s being done.
The $1.9 billion, as I said from the start, is calculated based on everyone participating in the employers health tax, as I’ve said from the start. If there are groups and organizations that need support — and we recognize that — that’s why, as I said, you see those conversations and the dialogue going on. Those announcements will come shortly.
T. Redies: The public sector represents about 25 percent of the payroll in this province, based on the statistics that we’ve seen. Was it the minister’s intention to tax the public sector? Isn’t it a bit odd that the government should be taxing itself?
I guess my final question is…. If it’s 25 percent and it’s $4 billion over three years that you’re hoping to collect in this province, that would suggest a $1 billion hole. Could the minister please advise which part of the public sector she is going to exempt or not exempt? Is she going to exempt charities? What will that do to the revenue that the government is expecting to achieve over the few years?
Hon. C. James: I think, again, the members will have heard me say this, and this is very similar to other provinces. Again, we have the opportunity to be able to learn from other provinces as they implemented their employers health tax and payroll taxes.
In fact, we are the last province left with a medical services premium. In fact, other provinces moved in this direction, many of them years ago, because it’s a much better process to use than medical service premiums, regressive taxes.
As other provinces have done, we will ensure that everyone is subject to the payroll tax, because it’s important when it comes to competitiveness between the public and the private sector that there’s not an opportunity for the public sector, for example, to say they can pay people more because they don’t have the employers health tax to be able to pay.
You provide the level playing field by ensuring that everyone has to pay the employers health tax, and then if there are supports that need to be in place for groups and organizations like charities…. I know the member wants me to make the announcement today in estimates, but the member is going to have to wait. I believe it’s important to finish up the due diligence and make sure that we’re doing that.
Groups and organizations know that that work is going on. In fact, many of them are providing the information to us that is needed to be able to finalize this. Those groups and organizations will hear that information soon. That will be determined soon.
Then, again, those resources will, as other resources are that come up during the year, go through the Treasury Board process and will be accounted for through contingencies. That’s why if the member looks at the contingencies — $550 million, $750 million, $750 million — those are exactly the kinds of examples of the support that may be needed that would come forward through that process.
T. Redies: There has been a lot said in the paper and in question period, as we know, about the impact this tax is going to have on businesses, municipalities, universities, school districts and other entities.
In the case of business, they’re being hit by the corporate tax increases, albeit small business is getting the tax decrease that was promised by the previous government. But businesses are also seeing carbon tax increases, minimum-wage increases, as well as increases in taxes at the federal level.
Has the government done any analysis as to what these combined taxes will do to job growth and business investment in our province? We already have a reputation that is going into the sewer right now as a place to invest. So would the minister please explain to us what analysis you’ve done to provide some comfort to British Columbians that these taxes are not going to stop businesses expanding their payrolls, stop businesses investing in this province and, worse, leaving the province?
Hon. C. James: I think it’s important, again…. I’ll just read into the record the list of initiatives, because I think it comes back to the very beginning of our conversation a couple of days ago about the difference in opinion that exists between that side and this side.
We believe it is important, in fact, to make investments that will support business, that will support a long-term sustainable economy and that will support families in British Columbia. Let’s remember, it is hard-working British Columbians who have built the strong economy in British Columbia.
Specifically to businesses: half a billion dollars since September in supports for businesses, reduced the small business corporate tax rate, extended the mining flow-through share tax credit, extended the scientific research and experimental tax credit, extended the training tax credit, extended interactive digital media tax credit, phase out PST on electricity.
That’s not taking into account the major investments in child care and housing in this budget — over $1 billion going into child care, which is an investment for business and for a strong economy. Again, when I take a look at the businesses and organizations in British Columbia that look at investments, the areas that they raise concerns about continue to be child care and housing. Those are very difficult issues for them to look at — recruitment and retention.
When you take a look at the strong economy that we continue to see in British Columbia, we continue to see the rating agencies acknowledge our balanced approach. In fact, their reports, when they reaffirmed our credit ratings, talked about our balanced approach, talked about the investments we made that will also be investments in the economy, exactly the kind of direction that we’re taking.
If we don’t address those issues, we will not see a long-term sustainable economy. And that’s not taking into account the dollars that are going directly in individual pockets that will get spent in communities. If you are an individual now, when the MSP is gone, you will receive an extra $900. If you’re a family, you’ll receive an extra $1,800 a year. Those are large savings for families that then will get spent in small businesses and restaurants and sports stores, in courses that the kids will be able to take, in clothes that they’ll be able to provide for their children.
I’ve heard those stories. I’ve heard those stories, already, for a family that’s going to save their $350 a month on child care, and what a difference that makes to their family budget. What a difference that provides to the small businesses in their community because they don’t take their money and invest it overseas. They take their money and spend it directly in their communities, in their local businesses, in the local economy in British Columbia.
That is exactly the kind of balanced approach that I believe will continue to build the economy, will continue to build the strength that’s needed and continue to provide the balance that’s needed in British Columbia.
S. Bond: Well, it’s becoming more painfully obvious every hour that there has been little analysis done about who’s going to pay what, how it’s going to get to $1.9 billion. This Finance Minister is actually…. You know, should she choose to make changes, it’s okay, because we have a contingency fund.
The other thing that I cannot believe the minister has not heard or does not understand — and I know she does understand — is that there are puts and takes here. She can continue to refer to the $900. She cannot tell us today, I’m assuming, that she does not realize that when you tax a business additionally, that money has to come from somewhere.
For many businesses, that means it will be transferred to taxpayers. Whether that’s with higher fees, whether it’s with things costing more, whether it’s with people losing their jobs or lack of expansion of businesses, there is an impact of a surprise employers health tax that will trickle down to taxpayers in British Columbia. The Union of B.C. Municipalities told the minister that straight up the other day. There are impacts for taxpayers that will lessen the benefit that this minister continues to talk about.
I do want to say this. The minister continues to say, day after day: “The announcement is coming.” Today we hear her say to us: “Well, maybe we want the announcement today.” You bet we do, because our offices have been filled with non-profits that are worried about having to reduce staff, cutting programs to the most vulnerable in British Columbia. Why on earth would this minister not, at the soonest moment, say: “You know what? Non-profits, we made a mistake. You’re out. We’re not going to impact you”? It’s not about me waiting for an announcement. It is about hundreds of non-profits across British Columbia waiting for that answer.
Having said that, our critics in all of the ministries went to their various ministries and asked about the impacts of the employer health tax. Virtually every one of them referred the questions back to Finance estimates.
We’ll start with Agriculture. Can the minister tell us today how many B.C. farms will be impacted by the payroll tax? Has there been any assessment done?
Hon. C. James: I mentioned earlier the StatsCan data, and that it is under sectors. I will read the sectors where there’re areas that the member is raising. We can provide this information, but we can also go through it, if that’s what the member desires.
For example, agriculture is in the sector that includes agriculture, forestry, fishing and hunting, and it’s 0.2 percent of the $1.9 billion in tax. There’s also a portion, when it comes to the area of agriculture, for manufacturing of food products. That would include wine, juices — any kind of secondary manufacturing of agricultural produce. That’s under the manufacturing sector, which also includes a number of other areas — beverage, tobacco, etc. That’s 7.5 percent of the $1.9 billion.
S. Bond: The greenhouse industry is particularly labour-intensive. It will be hit very hard by the payroll tax. Is the minister preparing any targeted relief for the greenhouse industry sector?
Hon. C. James: We certainly won’t consider an exemption, because everybody will be subject, as I said, to the employer health tax. But no, we are not looking at the greenhouse sector right now.
S. Bond: We’ll move on to education, then. The Minister of Education said to stay tuned. He implied that there was a potential for an exemption for education. Can the minister confirm today that she is considering exempting the education sector?
Hon. C. James: I’ll repeat it again for the members: there will not be exemptions. Everyone will pay the employer health tax. But there are groups and organizations that certainly need support. We recognize that.
Those are considerations that are being taken into account right now. We’re gathering the final data, as I said, and that includes looking at the issue of school boards.
S. Bond: Maybe the minister can articulate that again for us. Everyone will pay the tax. The issue is: would some sectors, then, receive additional funding to cover off the tax? Government is going to tax government, in the case of education. They’re going to pay it, and then the minister would refund or provide additional funding to cover that section of this tax?
Hon. C. James: It’s continuing on with the existing practice that has always been in place for government. That has not changed. Whether it’s PST…. Those groups and organizations pay PST, again, to ensure a level playing field, so there’s a level playing field between the public and the private sector. MSP, again, was paid. Government provided that resource. This is no different than has always been done in government to ensure that level playing field so there isn’t an advantage for the public sector over the private sector when it comes to looking at employees. Those discussions, as I said, are ongoing.
S. Bond: The minister was able to provide us with numbers related to farms, agriculture, food and forestry, manufacturing of food products. What is the quantum of the tax that she expects to collect from school districts?
Hon. C. James: I’ll repeat again, as I said earlier, when it comes to the individual pieces in each sector…. We use the StatsCan data, when it comes to sectors. When it comes to the individual pieces within that sector, that’s the information that we’ve been working on. That’s the information we’ve been gathering. How many school districts pay MSP total? How many school districts pay a portion? What are the resources that they’re saving this year? What are the resources that they’re saving next year? How do we account for that when we’re looking at the support that is needed?
That’s exactly the information that we’re gathering now, the final details that we’re working on, and that information will be out soon.
S. Bond: The minister was able to tell us that agriculture, forestry and something else was 0.2 percent. What sector does the education component fit into? What percentage of…? The minister said that she has it by sector but not specific pieces of the sector. Education, hospitals, universities, colleges, the general broader public sector — what percentage of the tax is being attached to the broader sector?
Hon. C. James: If we can just take a five-minute break, we’ll gather that information. I think that would be easier. Then we don’t monopolize the time of the members, and we can make sure we get the information.
The Chair: All right. We’ll take a five-minute recess.
The committee recessed from 3.43 p.m. to 3:53 p.m.
[R. Glumac in the chair.]
Hon. C. James: The member was asking about education. The sector that that’s under is the educational services sector. That would include schools, colleges, universities, public and private — so profit and not-for-profit — and training centres — again, private and not-for-profit. That’s 9.8 percent.
S. Bond: Can the minister just clarify that these labour force survey numbers that she is referencing from Stats Canada.
Hon. C. James: I mentioned that it was StatsCan data — StatsCan data called the survey of payroll and hours and Canadian business counts.
T. Redies: Can the minister confirm that MSP for most Indigenous people is currently paid for through the First Nations Health Authority?
Hon. C. James: We can certainly get that information. We don’t have that information now around how it’s transferred. Status First Nations do not pay health taxes. They do not pay medical service premiums directly. If the member is asking if the money then gets transferred from the federal government to the First Nations Health Authority, we’d have to get the details to do the follow-through for the member.
T. Redies: That’s a bit disturbing. This is a group that the government has singled out — quite rightly, frankly — to do more for, and the minister doesn’t have an understanding of how this particular tax change is going to impact First Nations? That seems to be quite surprising.
Has the minister or the ministry consulted with First Nations on the possible and potential impacts of the employer health tax on their people?
Hon. C. James: Yes, we certainly, obviously, have been having conversations with First Nations. I think the member’s question was not related to the employers health tax. The member asked about medical service premiums and what the structure is around how dollars come from the federal government or the provincial government to the First Nations Health Authority.
On the employers tax, the employers health tax is subject to section 87, which is an exemption of First Nations individuals, just as happens now around taxation. That means that the employers health tax is not levied on remuneration that is paid by eligible First Nations employers who are carrying on business on the reserve. So that continues with the example that’s in place now. Nor will the tax be levied on the remuneration paid to eligible First Nations people working for a business that is located on a reserve.
T. Redies: Thank you for the answer, Minister. Has there been any further consultation regarding the impact of the employer health tax on the friendship centres? And would the minister be requesting that the friendship centres be exempt from this tax?
Hon. C. James: Just as we’re having discussions with all charities — that’s also what Aboriginal friendship centres are — yes, we are having those discussions.
Remember again — I’ll come back to the comment I made — that no one is exempt. Everyone will be paying the employers health tax. Those groups and organizations that need support…. Those are the discussions we’re having right now. First Nations friendship centres are included as part of that discussion with the charities.
T. Redies: I’d like to go back to the composition of the $1.9 billion. Again, the minister is referring to the report from StatsCan in terms of how they came up with the $1.9 billion. The minister has also been quoted as saying that 85 percent of businesses will not pay the employer health tax. I’m curious. If she knows that 85 percent of businesses in this province won’t pay the employer health tax, how can she not provide us with a breakdown of how much of the $1.9 billion will be paid by businesses?
Hon. C. James: The information that I think will be helpful is the number of businesses we’re taking a look at when it comes to the payroll tax. There are approximately — again, this is StatsCan data — 350,000 businesses in British Columbia who have payrolls below $500,000. So they’re exempt, as the members know. That’s an estimated percentage of total businesses of 87 percent. The members will know that we’ve used the 85 percent, but 87 percent is the StatsCan data.
The estimated number of businesses in British Columbia who have payrolls between $500,000 and $1.5 million would be 36,000. That’s a percentage of 9 percent of total businesses in the province. The number of businesses who’d pay the full amount of payroll tax — that’s over $1.5 million — is 14,000 businesses. That’s 3.5 percent of all of the total businesses in British Columbia.
T. Redies: Thank you to the minister. I’m not sure if the minister has had a chance to read the CFIB report that was recently released on the health tax. It paints a far different picture than what the minister is indicating. They are indicating that 44 percent of small businesses will be affected. At the same time, 56 percent of those business owners also say that the health tax will be more costly than MSP, and 60 percent indicate that it will hurt their business. Does the minister think the CFIB is wrong or these businesses don’t know what they’re talking about?
Hon. C. James: I think the important piece to look at when taking a look at the information that comes from CFIB…. We certainly appreciate their feedback, and we take it into account. We’ve met with CFIB as well. We take their information. But it’s very different than data that comes from StatsCan, for example. CFIB’s figures are based on those businesses who choose to do their survey. It’s not data that’s collected. It’s businesses that have provided information to CFIB.
They based their analysis, for example, in this survey, on 768 businesses. That’s who they chose to get the information from. It’s certainly worthwhile information. As I said, I certainly appreciate the work that they do and the information that they bring forward to us in the Finance Ministry and to me as Finance Minister, but that’s very different than data that comes from StatsCan.
T. Redies: With all due respect, Minister, based on what we’ve been hearing today, I must admit I’m not very comfortable with any of the data coming out of government. CFIB has indicated that 60,000 businesses will be covered by this tax. Again, given the lack of data that the ministry appears to have on which entity is being taxed, what sector, etc., I think I would go with the small business folks, because they know their payrolls. If 60,000 of them are saying that they are going to be impacted by this tax, I would say that’s probably a lot better likelihood than what the ministry is currently telling us.
I’d just like to now turn to public safety. Again, this is another area that’s important to British Columbians. And it appears, again, that every sector in this province is going to be impacted by the EHT. Will all policing payrolls in British Columbia, the federal and provincial combination, be subject to this employer health tax, including the federal section, the ones that are fully funded by the federal government, like the drug sections and the federal enforcement sections in the province?
Hon. C. James: Again, I come back to the basis of the tax, which is that if you’re employed in B.C., if your place of work is in B.C., you pay the payroll tax. You pay the employers health tax. It’s just as other provinces have done. This is no different than Ontario, Manitoba and other provinces that have an employers health tax. If they’re employed in that province, if that’s their place of work, they pay the payroll tax.
T. Redies: Minister, could you explain to us how many child care providers in B.C. will be subject to the employer health tax, and what would be the total cost to child care providers in B.C.?
Hon. C. James: Just so the members know, based on the StatsCan data and the sectors, as I’ve talked about, that we’ve utilized, child care is under the health care and social assistance sector. That’s a very broad sector — won’t identify the individual child care centres.
That’s about 13 percent of the tax in that particular area. But this is an area where, obviously, because of the child care program that’s being implemented, there is data that is being collected around child care centres in British Columbia for the new program that’s coming into place.
We are completing that data. We haven’t completed it yet, so I don’t have the specifics to give the member yet. We are close to that. They’re both public and private daycare centres, not-for-profits and private sector. I can say that in the initial go-through of the data that we have, a large number of child care centres are exempt because of the size, because of the $500,000 payroll that exempts a number of them. But there are, as I said, some that are larger, and that’s the data that we’re collecting now.
T. Redies: I do think that child care providers have a lot of things on their plate right now. They’ve seen minimum wage increases and, of course, inflation going up and fuel costs going up. Hydro bills went up April 1. So the employer health tax on top of that, for some, is going to be the last straw. In fact, one market-based provider, a large one, told this side of the House that she will likely go bankrupt because of it.
I guess my question to the minister…. You mentioned public and private child care centres. Is the intention to provide support to both public and private child care centres, given these problems?
Hon. C. James: I mentioned that we’re looking at a number of sectors and supports that will be needed. The ministry and ourselves are looking at the child care sector. We’re looking at everything right now. I don’t have an answer to give the member, but we are looking at all of the options that are there.
I do want to just remind the member, though, that child care centres, in fact all child care centres, have the opportunity to be part of the new child care program, which provides them with an increase in their child care grant. So although the member talks about the challenges that they’re facing, they’re also facing an opportunity here. That is not only to receive dollars to make child care more affordable for families, but they also receive supports for their child care centre and an increase in the grant, which has not happened in a number of years. So there is an opportunity there.
Then, just again a reminder, to put it in context for everyone, that the payroll tax is the lowest payroll tax rate in the country, 1.95 percent. It’s very reasoned, as I said, when you take a look at other provinces and the payroll taxes they put in, when it comes to ensuring that we also bring in resources for health care.
T. Redies: Minister, we all know there’s a shortage of child care spaces in this province. So why would the Ministry of Finance implement a tax that would potentially put child care operators out of business?
Hon. C. James: I will say to the member that this is an opportunity, from my perspective, to talk about the investments we are putting into child care.
In fact, just the opposite from the member’s comments, we are putting a $1 billion investment into child care. This is the largest investment that has been made in the history of British Columbia. It’s a major investment that, as I’ve said and will say again, is good for families, good for the economy, good for businesses and good for children. That is key when we’re taking a look at making investments in our budget. So in fact — just the opposite from the member’s comments — we’re investing in spaces, increasing spaces.
The member talked about the lack of spaces. The member is quite right. There is a lack of spaces in British Columbia. I think we need to look at what happened over the last 16 years. That did not include in it a huge expansion of child care spaces. So in fact, we are investing in a comprehensive way in child care, by putting supports in place for increasing spaces in British Columbia, by putting supports in place for expanding support to child care centres to be able to look at affordability for families.
Those benefits will make a huge difference in families’ lives. In fact, you will find families of very low incomes will have low or free child care for children in British Columbia in September for those licensed child care centres that take part. We’re also providing support for child care centres to become licensed so they can participate in the program by providing supports, whether it’s equipment or training dollars, things that people need to be able to become licensed. So we can ensure again and provide that support and safety for families and the kind of peace of mind that people need when it’s looking at child care.
We’re providing support for early childhood educators because, again, we’re not going to build a child care system unless we have quality early childhood educators. We’re providing bursary programs and supports for people to go into the field. So just the opposite from the member’s comments, we in fact have made a major commitment. We have made a major statement with this budget, and we have fulfilled one of the biggest pressures being faced by families and by businesses when it comes to recruitment and retention and when it comes to getting women back into the workforce.
We know, again, that in a very hot labour market the opportunities for women to get back into the workforce are to have quality, affordable, accessible child care there so that they’re able to get back in. Particularly in those early years, when they’re going from maternity leave that they’ve finished up and back into the workforce, that’s the hardest time to connect. Providing those supports for the early years, where we’re beginning the program, will provide that kind of support.
T. Redies: Is it this government’s intention to put private sector child care operators out of business?
Hon. C. James: I’d be happy to talk more about child care, because in fact, as I’ve said, it’s just the opposite.
Interjection.
Hon. C. James: Just the opposite. We are in fact investing in child care. We’re providing supports for child care. We’re providing the opportunity for licensed child care to be able to come into the system and provide support to them in their grants, to the centre and the early childhood educators who work in that centre, and to be able to provide an opportunity for parents to be able to have choice across the system.
There’s licensed child care in family homes. There are individuals who provide child care out of their homes who are licensed. There are those who unlicensed who, yes, we will encourage to become licensed, because that’s a health and safety issue in British Columbia. I think we all will remember that tragic story of the individual family and the baby who died in the child care centre — in a home, in an unlicensed centre. I think that, again, is something that will remain with all of us when it comes to the kinds of supports that we’re putting in place for child care.
Are we committed to increasing child care spaces and to providing support for child care, choices for parents? Yes, we are.
A. Weaver: I have two questions on this subject of the employer health tax. When the B.C. Green Party called for the elimination of MSP a number of years ago, we were basing our decisions on how we would move forward on the Ontario model. One of the big reasons, as well, that we thought that — and one of the issues that I haven’t heard canvassed yet — was that there’s an enormous waste in the MSP system. We know that monthly bills go out month after month to people all across British Columbia. We know that credit agencies are given files where there are lots of debt that has never been paid.
My two questions to this: how much money is being saved by eliminating the monthly billing of the MSPs, and how much of the outstanding liability exists with respect to MSP premiums that have not been collected? What is the government planning to do to get some of that money back, if they have any possibility of getting it back at all?
Hon. C. James: Thank you for the question. I think the member has described exactly one of the many reasons, certainly one of the large reasons, that it’s important to eliminate medical services premiums.
I don’t think there’s anything that people have described as worse to administer. The member mentioned the challenges of administering it for government, the challenges of administering it as employers and then the individuals. So it trickles down.
I’m sure the member has heard the stories, as I have, of people who’ve left a job where they were paid their MSP premiums, gone to a job where they aren’t, trying to get back in — or the other way around — and be able to manage to figure out what they owe and have the billing be correct.
Seniors. I think the member mentioned this issue before, and I’ve certainly heard it — seniors in my office crying because they’ve received the collection notice. It’s the first time they received the notice. So I think it’s clear that that is something that has to be taken care of.
The contract it services will be about a $60 million savings, to end that contract for managing the medical service premium. The debt expense right now is $115 million, so that would be debt, obviously, that would need to be written off or collected. That’s roughly the amount each year. So that’s, again, a savings when you look at the bad debt that has to be covered each year.
T. Redies: I just want to ask the minister a question about tax deductibility with respect to EHT.
For most businesses today, I believe, covering an employee’s MSP is tax-deductible for the employers as an expense. So could the minister confirm that the employers health tax will be deductible as an expense as well?
[J. Rice in the chair.]
Hon. C. James: Yes, it’s deductible, as the member knows, in other provinces. So yes, that’s the expectation in B.C. as well.
S. Bond: I want to spend a few minutes talking about the impact on non-profits. I know the minister recognizes, at least — well, I am certain that she has heard it loud and clear — that non-profits are extremely concerned about this. I think every MLA has probably had delegations of them in their office. I certainly have, from organizations that I admire and respect and that provide incredible services.
One of their significant concerns is that because this tax is being imposed on non-profits, many of them are contemplating how they’re going to be able to afford to make those tax payments. One of the things they said to me which I thought was incredibly insightful and a significant concern for them was the fact that their organizations would likely be required to either discontinue some services, some programs, or lay off staff in order to pay the employer health tax.
Their concern was that the very people that this government talks about, in terms of affordability and vulnerability, will be impacted by those reductions in staffing or programs. It was a very poignant discussion with the non-profits in our community, which I shared with the member for Prince George–Mackenzie.
Their question was…. “We’re providing services to some of British Columbia’s most vulnerable people, and now, because of the employer health tax, we may have to reduce staff or discontinue programming.” Has the minister heard that concern, and what is she prepared to do about that?
Hon. C. James: Certainly, I’ve heard conversations. I’ve had some incredible discussions with not-for-profits. As the member knows, it’s part of my past, as well, working in not-for-profits. It’s an area that I’m very close to and an area that I am very committed to. They do exceptional work in our province.
I think it’s a piece that, certainly, we as government have talked about — how to ensure that the contribution that they make in our province is better recognized, better acknowledged and better supported. It’s precisely the reason, as I mentioned, that we are taking the time to gather all the information from all sectors, including the not-for-profit and charity sector, to ensure that we have all the information around who is paying MSP and who isn’t, who is finding savings from MSP, etc.
That’s all the information and the work that we’re doing. I couldn’t agree more with the member around the good work of not-for-profits and the contribution that they make in our province, and that’s exactly why we’re having that conversation now.
S. Bond: If the minister sees so much value and knows firsthand about the importance of non-profits, why were they included in the tax in the first place?
Hon. C. James: As I’ve said and I’ll say again, it is important, as you see in other provinces, that no one is exempt from the employers health tax. Everyone pays the tax, so there is a level playing field when it comes to hiring in the public and private sector. That is what Manitoba has done. That’s what Ontario has done. That’s what other provinces have done.
We recognize that some sectors need the supports in place. That’s why we’re having these discussions, and that’s why we’ll be coming out with a decision shortly.
S. Bond: I want to pursue the difference between exemption and providing support. Can the minister tell me if the government has a relationship with every non-profit that would be impacted by the employer health tax? If they are required to pay the tax, what kind of system would the minister use to then return funds or provide relief?
There have been a myriad of words chosen: “Supports might be needed. They would be kept whole. Everyone’s going to pay. Somehow we’re going to take care of that.” What administrative system…?
The minister spent a fair bit of time this afternoon talking about the complexity of the MSP premium and collecting. Does the government currently have a relationship with every non-profit that would make it efficient, easy and systematic to be able to return some form of support, relief, keep them whole? How on earth will that work?
Hon. C. James: I think the member has described a number of the areas that we are in discussion with the sector on, including implementation, including what makes sense.
I think we have to remember, when it comes to not-for-profits, that there are a larger number of not-for-profits that have a payroll less than $500,000 than in other sectors, for example. Because of that threshold, you have already excluded a large number of not-for-profits from paying the payroll tax to begin with, because of that number. So those people will not be subject.
We’re having continued discussions, talking with the sector, looking at other jurisdictions and the variety of ways that they’ve provided support as part of the implementation discussions that are going on now.
S. Bond: Sorry, I’ll ask the question again, then. I’m asking the minister about the mechanics of the relief process. We’ve heard now that it’s not an exemption. It’s not a wholesale exemption of the non-profit sector. It’s whether they’re going to get relief or not. How will that work?
If there is not a formal relationship between the non-profit sector and government — in other words, they don’t get government grants; they have no connection — how will the “You pay, and we’re going to support you” or “We’re going to return some funds” or “We’re going to give you something”…? What are the mechanics of the program that is being considered for some form of relief for the non-profit sector?
Hon. C. James: It’s the answer I just gave, which is that that’s exactly the kind of conversation we’re having with those larger not-for-profits. As the member knows, the smaller not-for-profits, because the payroll tax has the threshold of $500,000, are already exempt. We’re having discussions about what the most effective, smooth and straightforward way of implementing supports would be. There are a variety of ways, as I said — looking at other jurisdictions, having discussions with the not-for-profit sector.
S. Bond: The thinking that’s being done around the not-for-profits…. Is the minister contemplating completely mitigating the impact of the employer health tax on all non-profits?
Hon. C. James: I think we’ve had a discussion around a number of areas that are part of the implementation. This is part of the implementation.
There are a number of options that are there on the table, including, as I mentioned before, making sure that we also account for the medical services premiums for those organizations that pay medical services premiums and that now will see a saving of those medical services premiums — 50 percent this year, 50 percent next year — before they’re completely eliminated. So all that will be taken into account as part of the implementation.
S. Bond: The chart that many non-profits have provided us with…. You know, the minister can speak all she wants about the 50 percent reduction. Next year is a double-dip year. Those organizations are paying not just 50 percent of the MSP premiums; they’re paying a new employer health tax. So to suggest that that is painless or simple to accomplish for not-for-profits is simply not accurate.
Let’s put one other fact onto the record. When we look at the ongoing cost of the employer health tax for many not-for-profits, for many businesses, for many organizations, the ongoing cost is higher than what they are paying today for MSP premiums.
I ask my question to the minister again. This employer health tax is, for many — probably the majority of — businesses and not-for profits, going to be higher than their MSP premiums were. Is the minister prepared to completely mitigate or exempt…? I understand they’re going to pay it, and then somehow they’re going to get relief given to them. Will the minister commit today to excluding not-for-profits from the employer health tax?
Hon. C. James: We are in discussions with the not-for-profit sector. We’re talking with them about the savings on MSP that many of them are accounting for — this year 50 percent, next year 50 percent. We are in discussions with them about the support they need, and those decisions will be coming shortly.
S. Bond: To the Minister of Finance, will she today at least acknowledge that in the double-dip year, not-for-profits and everyone else, while they will see a reduction in their MSP premium, will see the addition of a second tax, the employer health tax, and that 50 percent of the reduction in MSP premiums will not cover the second tax they are facing next year?
Hon. C. James: Again, I think it’s important to put the facts on the table. Yes, there will be employers who have not paid MSP and who will be paying more with the employer health tax. They have not contributed to health care and now will be contributing to health care. There are employers who have been paying medical services premiums and who will see a saving of 50 percent of their medical services premiums this year, because of the 50 percent cut that has happened, and a 50 percent cut that will happen in 2019.
Some employers will pay more because of the employer health tax. Some will break even, with the numbers that are here. It will vary, depending on how much they have paid in medical services premiums and what they were paying for their employees.
S. Bond: Thank you to the minister for that answer, because we’ve heard now that the minister recognizes there are employers that will pay more. There are employers who didn’t pay MSP premiums and who are now facing a tax. And in the double-dip year, not-for-profits in particular, many of them, will face, yes, a reduction in their MSP premiums, only to have to pay an additional tax, which was a complete surprise to them.
Once again to the minister, is she prepared to today at least provide some sense of relief to not-for-profits across the province that she will mitigate and exempt the not-for-profit sector from the employer health tax?
Hon. C. James: I’ve answered that question. We’re in discussions with the not-for-profits, and the answers will come shortly.
S. Bond: The minister has been saying for weeks now that she has been talking to not-for-profits and that they should just wait. It’s not about me just waiting. It’s not about my colleague just waiting. It’s about not-for-profits waiting.
How much longer will not-for-profits have to wait? Is the minister waiting till the end of session? Is she waiting till June, till July? When can not-for-profits in British Columbia expect an answer to a question that they deserve to have an answer for?
Hon. C. James: I’ve answered this already. We are making sure that we have all the data. We are making sure that we have all the information that is required to make the implementation smooth. I certainly hope that I will have that answer before the summer. And I’ve given that response already.
S. Bond: What we’ve seen this afternoon is that this minister announced a tax, based on Stats Canada data and multiplying numbers, and basically announced to British Columbians that employers, businesses, hospitals, universities, not-for-profits — everyone — is going to have to pay a tax that there is no data for which this tax is based on.
Perhaps the best idea would have been to listen to the advice that was provided in the interim report of the very panel that this minister put in place — she chose to ignore the data, chose to ignore the recommendations and the warnings — and, perhaps, to wait and do her homework to put together a tax plan which now does not leave not-for-profits and everyone across British Columbia waiting to see who’s in, who’s out, who gets relief and who doesn’t.
It’s hardly…. When you look at a methodical and significant analysis of tax policy, this would be a textbook example of how not to do this.
Let’s move on to the municipalities. The Union of B.C. Municipalities provided this minister with a report. Has the minister read that report? What are her comments to the concerns expressed by municipalities right across British Columbia?
Hon. C. James: Yes, I did read the UBCM report and did take a look at it. In fact, we did some analysis, as the member knows, because some of these questions have arisen in question period. So there has been an opportunity for some of this discussion to occur in question period.
If we take a look at…. We, in fact, used the UBCM data, which is around their costs and around their savings from MSP. Using their data — not our data, the UBCM data — we took a look at: if they put all of the net costs onto residential property, what would the cost be per household? Again, as I’ve said in question period, the municipalities will make their own decisions around budget. That is not something that we make a determination on. They make a determination around their costs and where they want to put their costs, what their programs and services are. So that’s their determination.
But if you took the scenario of the net cost to put on each household…. Again, this is presuming that all of that net cost would go onto a residential property, which, again, doesn’t happen in municipalities. They tend to share the amount on the residential property and on the businesses in their communities.
If you took what I think is kind of the end example that you might look at, the net cost for municipalities — and I’ll just give a range here to the members — per household would be, for example, Burnaby, $13.44 per year for individual households. That’s if the total net cost for the employers health tax went onto a property. Campbell River, $3.33. Colwood, $8.78. Duncan, 46 cents. That’s the total net cost that will go onto a property. Harrison Hot Springs, for example, would actually save money. They’d be ahead $7.62. Lake Country, $1.43. Maple Ridge, $10.50.
I think the members can see, as we go through these numbers, using the numbers…. I just wanted to find Vancouver, because I think the members may ask for the largest city. Even in Vancouver, you’d be looking at $52.02 in a year.
When you take into account the savings for individuals of $900 per year, the savings for families of $1,800 per year…. Even in the worst-case scenario, which is that all of those extra costs go onto each individual, residential household, which is unlikely to occur, you are still seeing large, large savings for individuals. Penticton saves 12 cents per household if you’re taking a look at it. Prince George — $14.04 on each residential property would be the total cost in a year. Then again, as I say, if you take into account the individual savings, I think it’s pretty clear that there are savings for individual families and individuals.
S. Bond: Well, I think it’s ironic, hon. Chair, that this minister…. We saw the same response when we raised the issue of people who live in homes and who are asset-rich and cash-poor. The answer was: “It’s only $1,000. They can figure it out.” Or I guess the implication is that they would have to sell their home.
This minister now looks the Union of B.C. Municipalities in the eye, people who have been elected to represent their communities. She receives a report with significant concerns. The minister can read off all the small numbers that she wants, but all of these municipalities are already dealing with a tax burden for their constituents. This minister is applying a tax that will be downloaded, through property taxes — and the minister knows that’s very likely how it’s going to happen — to taxpayers in British Columbia.
When we look at the report that was sent, yes, there are communities that might save money. Let’s look at Saanich. Compared to 2017, before the MSP was reduced, Saanich is looking at nearly a 350 percent increase in costs from the employer health tax. The CAO of Saanich has said that they “cannot manage a 1.3 percent property tax increase from this additional expense through simple ‘belt-tightening.’ We would have to amputate a limb.”
The minister can be as casual about the fact that this is a significant impact on many communities in British Columbia. The minister actually says she’s done the analysis. In other words, in this case, there’s an analysis of the Union of B.C. Municipalities numbers, and the minister looked them in the eye and said: “No relief for you.”
Today can the minister confirm that there is no relief, that no relief will be provided, to municipalities across British Columbia? Can she at least acknowledge that it is very likely, according to the Union of B.C. Municipalities report, that property taxes will increase across British Columbia because of the employer health tax?
Hon. C. James: It is up to individual municipalities to make a determination around their budgets. I wouldn’t tell them how they should allocate their funds, where they should find resources, where they should make spending decisions. That is entirely up to municipalities.
Will there be a cost of the employers health tax on municipalities? Yes. We believe, again…. When we’re taking a look at getting rid of medical services premiums and the savings to municipalities, of that 50 percent in 2018 and the 50 percent in 2019, and, ultimately, the savings to the members that they represent…. Let’s remember that these municipalities represent individuals in their communities, who will also find those huge savings when it comes to medical services premiums in their communities.
The member mentioned Saanich, just as an example. If Saanich made a decision…. Again, it’s their decision to make. It certainly isn’t my decision to make. If they made a decision to put all of the net cost onto residential property, which is not done by municipalities — they usually share that across the board — it would be a total of $35.60 per year for individual residential households.
I think, again, we are happy to continue to work with municipalities, to look at providing the support when it comes to the employers health tax, as has occurred in other provinces across this country. Employers will pay the health tax. That will ensure that we protect the supports for health care, ensure that we have the services and supports that assist the infrastructure that municipalities have and find savings for individual families, who will spend those in their local communities.
S. Bond: I will re-ask the question because of the answer the minister just provided to me. Will there be support for municipalities in terms of relief from the employer health tax?
Hon. C. James: The member knows I’ve answered that question. No.
S. Bond: The answer is: there is no relief for municipalities. The minister’s argument about “it’s up to them” in terms of how they distribute the cost that the government is downloading. What is the minister’s response to the concern expressed in the UBCM report that “many local governments are questioning a tax policy that results in the funding of a provincial service, health care, through property taxation”?
There’s a theme developing in the government as well. If you take a look, for example, at the MRDT funds, we’re now seeing that with MRDT funding, which is designed for tourism marketing, the minister is going to open up the opportunity there for those funds to be used for affordable housing. We have a school tax which, by any other name, should be called an affordable housing tax, and we have a speculation tax that is actually an asset tax.
Can the minister respond to the concern of the Union of B.C. Municipalities? While she argues, rightly, that they’re going to have to figure out how to pay the employer health tax and how they are going to transfer that to their constituents, how does she feel about the fact that the Union of B.C. Municipalities has stated that they’re concerned the minister is downloading the costs of a provincial service and expecting municipalities to recoup that through property taxation?
Hon. C. James: I want to start off with the example that the member used around support for provincial programs — exactly what the previous government did when they doubled medical service premiums. Was there support given to municipalities in the doubling of medical service premiums that they were paying? No. Were those costs absorbed and had to be found by the municipalities? Yes. Were those dollars that municipalities had to find and make decisions about? Yes.
The member mentions downloading. I have to say, when I take a look at what the conversations have been at UBCM for the last number of years…. I’ve been going to UBCM for ten years as a school trustee, as president of B.C. School Trustees Association, for five years and as an MLA for the last 11, 12, 13 years now.
The conversations each of those years, while the previous government was in place, were exactly about the conversations of the pressures that the previous government was putting on municipalities, whether we’re talking about housing, whether we’re talking about transit, whether we’re talking about the mental health issues, whether we’re talking about service cuts.
That was the legacy of the previous government. That’s exactly the kind of crisis that municipalities were in, because they were expected to take those services up.
We are taking a different approach. We are taking a very different approach in partnering with municipalities. We are working together with them around housing. I can list off all of the housing announcements that have been done around this province in partnership with municipalities to assist them in looking at building housing.
Transit. Major transit announcements. Major transportation supports are being put in place, again in partnership with municipalities, because we know how critical it is that we work together for the constituents that are there.
The member mentioned MRDT, previously known as the hotel tax, which is how some people may refer to it. In fact, it was a request by municipalities to ask, if there was an agreement with the tourism industry, if they could utilize some of the tourism dollars for housing in areas where there was a crisis when it came to housing.
The example would be Tofino, a community where there is a crisis in being able to find affordable housing for people working in the tourism industry. They came to us and asked: if they sat down with their tourism association and saw that as an opportunity because it would support tourism, could they do it?
Again, we believe in the partnership with municipalities, not telling them: “This is exactly what’s going on.” We partnered with them. That is enabling opportunity for municipalities and the tourism industries to work together.
Again, when I come back to the numbers — using UBCM’s numbers themselves — as the members can see, the savings to the individuals in their community, the benefit to those communities far exceeds the kinds of dollars, even if municipalities made the decision to put all of this on the property tax.
T. Redies: Minister, over the course of this afternoon, we’ve discovered that the ministry put forward a new tax with an astounding lack of detail and lack of analysis with respect to this tax policy. In fact, really, it does appear to be tax policy on the fly.
Meanwhile, municipalities, charities, businesses, health authorities, universities are in chaos right now because they don’t know what they have to budget. They don’t know what they have to do. And all this time this minister has been saying: “Just wait. Just wait. We’ll get to it. We’ll get to it.”
Well, Minister, in all my years in business, I’ve never seen a budget built on revenue projections that cannot be explained. The fact that you are also talking about: “We’ve got, now, $700 million, $800 million….” The contingencies are there because the minister couldn’t design a proper tax policy. I mean, it’s just astounding. The impact this is having is going to be significant, regardless of what the minister is saying. In fact, the minister is also very fond of calling this tax, the MSP tax, regressive.
Can she explain how raising this money through property taxes…? We know the municipalities are going to have to get their money from the property tax owners. How is that not regressive? In fact, UBCM’s quote on property tax was: “It does not fairly distribute costs across income levels, placing an undue share on lower- and middle-income British Columbians.”
Minister, with all of the issues around this tax, why don’t you just take a hiatus? Why don’t you just say: “Look, we’ll get these things fixed, and we will come back at a later date when we’ve actually got our act together and we actually know what we’re going to be doing”?
Hon. C. James: There are a few areas that I want to touch on in response back.
The member referred to property taxes again. As I’ve said and I’ll say again, it’s up to the municipalities how they are going to make a determination. I think when you take a look at the medical service premium tax, it’s very clear that medical service premiums are regressive, and we made a decision in the budget to eliminate them.
I’m very proud of that decision. I’m very proud of this budget. I’m very proud of the fact that we brought forward a balanced approach that actually looks at investments in people, investments in services to improve lives of people and building a long-term sustainable economy.
Were we going to continue down the path that the previous government had, which was building an economy based on the speculative real estate market? No, we were not. We were going to make sure we invested in the people who help build a strong economy. We are going to invest in making sure that there are opportunities for all British Columbians, that prosperity is shared with British Columbians.
There is an incredible wealth in this province. We are a very rich province when it comes to resources, when it comes to our environment, when it comes to the variety of people, the entrepreneurs, the extraordinary number of people from across our province who come from all walks of life and all parts of the globe that bring their skills to our province to contribute to our economy. The challenge that they faced over the last 16 years is that they were not benefiting from that strength in the economy. They did not see their share of the benefit of the economy that they worked hard to create in British Columbia.
Am I proud of this budget and the balanced approach that it brings forward? A balanced budget. Prudence built into the budget. Major investments in the people in this province, in child care, in housing, in health care. Yes, I am very proud because it’s exactly the kind of approach that I believe British Columbians were looking for.
It shows the kind of support that is there for the business sector, as I mentioned earlier. Half a billion dollars in support for businesses in everything from reducing the small business corporate rate to the mining flow-through share tax credit, phasing out PST on electricity. That is a major investment in businesses of half a billion dollars to be able to ensure we remain competitive and support those industries that are moving ahead.
We see it in the new businesses that are investing in British Columbia. We see it in the economic activity and growth that continues. We see it in the kind of employment in British Columbia.
Governing is about making decisions. Are some of these decisions that had to be made to be able to invest in British Columbians? Yes, they are. I’m proud of these decisions because they’re exactly the kind of decisions I believe British Columbians were looking for.
With that, Chair, I move that the committee rise, report progress and ask leave to sit again.
Motion approved.
The committee rose at 5:13 p.m.
PROCEEDINGS IN THE
BIRCH ROOM
Committee of Supply
ESTIMATES: MINISTRY OF
TOURISM, ARTS AND
CULTURE
(continued)
The House in Committee of Supply (Section C); N. Simons in the chair.
The committee met at 1:38 p.m.
On Vote 41: ministry operations, $140,681,000 (continued).
T. Shypitka: Thank you, Minister, for the opportunity to ask just a couple of questions, regional ones.
When we left here on the break, we were talking about Family Day and the great idea to align Family Day with other Family Days across Canada and also to coordinate it with Presidents Day in the United States.
When we last left, I found it fairly astounding that the Ministry of Tourism had no involvement, really, in the implementation of changing Family Day and that it was a government decision. I would have thought that the Ministry of Tourism would have, certainly, some referral to that idea. So that’s what we’re talking about right now.
We’re talking about the alignment of Family Day and how the government thinks it’s a good idea, and there are great benefits to British Columbians. There are no really bad things that could happen from taking away what we’ve got right now and disaligning or having it separate — a separate holiday from the other provinces and Presidents Day.
Let me just maybe illustrate some of the issues I have in my riding. B.C., we all understand and recognize, is a beautiful province. It is the best jurisdiction in the world. We have seas and mountains and deserts and rainforests and everything. We recreate here, and we play here. It’s probably one of the reasons why a lot of us move here. I know my wife, for example, is from Ontario, and she moved here just because of the natural beauties of British Columbia.
Interjection.
T. Shypitka: Anyways, we love to live here. We love to recreate here. Family Day is one of those times that we like to recreate. I would dare to say that most of us in British Columbia recreate right here in British Columbia. The minister herself said earlier that we like to explore. We like to go within British Columbia.
But by marrying all these holidays into one Family Day with the rest of the provinces, and Presidents Day, we’re creating some hardships, in my opinion. We’re tripling our accommodations. For B.C. Day, we have no other competition. We have no other jurisdictions coming here utilizing that long weekend.
Now with the long weekend aligning with Presidents Day and all the other provinces, everybody’s coming into British Columbia, including British Columbians themselves, and jockeying for position in our hotels. On our highways, the traffic is now triple. In my corner of the province, in the southeast corner, we border, actually, the U.S. and Alberta. We’re fairly unique that way. So we have a great influx of people coming into our region. That fills up our hotels, actually overfills our hotels.
Accommodators, to make up for that lost revenue they had the weekend before, when they had B.C. Day, now have to jack up prices on hotel rooms to make up for that lost revenue they had before. They only have a certain amount of rooms, as the minister would know.
It also clogs up our highways. We have tremendous traffic going east and west through our corridors, which makes it not only timely — it takes us more time to get to where we’re going — but it also makes it a safety issue. We’re seeing more accidents, more fatalities on our roads because of increased traffic. That’s to be understood.
The minister herself, even, was…. I agree with her. A new museum. I think this is being introduced?
Interjection.
T. Shypitka: A new exhibit. Absolutely, we want to see those exhibits. We as British Columbians want to see that exhibit. But when the lines now are triple because we’ve got our visitors from Alberta and the United States coming here, we’re standing in lines longer. We’re not going to be able to see that exhibit. Maybe the ticket price is going up as well.
As the minister can kind of see, this isn’t just about alignment. We’re actually talking about something pretty unique we had in B.C. We were able to have our cake and eat it too, in essence.
We were able to entertain ourselves on a long weekend with no traffic, with low accommodations, reduced prices. I know in my riding, the ski hill actually offers B.C. residents half price on ski lifts and things like that. We won’t be able to enjoy that anymore, with Albertans and U.S.
We welcome all our visitors. We want to showcase our area. There’s no doubt about it. Tourism is what drives this province, in a lot of ways. But we’re getting shortchanged a little bit. What we had before is we had a unique area where we could actually go and do our own little family time on our own long weekend. Then, on the other long weekends, where the other provinces and the U.S. come in, we could entertain. People could come here. We don’t need to travel on those days.
Yeah, there’s a little give and take on both sides, but the impact, in my region and a lot of the resort municipalities that rely on those two weekends, of an influx of visitors is now being damaged greatly. I guess the question to the minister is: can she actually recognize these concerns that my residents have, in regards to losing this one week of revenue?
Hon. L. Popham: I understand the member’s concerns.
One of the things that I’d like to throw back to the member is Canada Day. The whole country is aligned, and we seem to all be able to celebrate and enjoy each other’s company from province to province.
Can the member tell me what the difference is?
T. Shypitka: I’m getting questions? Okay.
Well, to answer the question, the fact of the matter is: yes, other provinces have the same long weekend, the third weekend in the month. We in B.C. have a unique situation where ours is the second. Therefore, we’re able to do our own travel within our own province and not worry about an extra influx of tourists coming in to enjoy the long weekend. We actually have an opportunity to have our cake and eat it too, in essence.
What I’m asking the minister is: can she not recognize or realize that that is a detriment to accommodators who are trying to get everybody into their hotels or their rental places in one weekend instead of smoothing it over two weeks? It’s a pretty simple question.
There’s definitely a detriment, not only to hoteliers that, instead of having two great weekends, only have one but also to the cost of residents and to travellers that come into the province that are actually now paying higher prices because the hoteliers have to absorb those costs, because they’re losing revenues on the weekends they used to have.
Hon. L. Popham: I understand the concerns. When you make a change like that, there are some adjustments that have to be made. I think that the example I gave of Canada Day…. We’re aligned across the whole country, and we make it work.
The member is assuming that family members are all in B.C., when many of us have family members that live in different provinces. For me, as an example, I have family members from Saskatchewan, so I would look forward to an opportunity to meet with them when everybody’s got a day off.
That being said, the decision is made. The Family Day is going to be on a different day. It will be aligned with other provinces, and the government made that based on what we think the value is to families in British Columbia.
T. Shypitka: What the minister sees as a benefit I see as a detriment. I have family and friends in Ontario. I said earlier, my wife was in Ontario. They have a different Family Day. We go there when it’s our Family Day, and they come here when it’s their Family Day. We don’t need that day of travel.
In Alberta, for example, people come to British Columbia when it’s their Family Day. That’s great. Less traffic. We don’t have ours going on. There’s no competition going on. The rates are cheap. The traffic is light, and they’re able to visit. On their day of travel, they go back on Mondays, usually. That’s when we usually go back to work. That’s a day of travel. It works out really great.
On the opposite side of the coin, when it’s our Family Day, we go to Alberta. You’re actually minimizing more family time by doing this. It’s a good thing that we’re having this conversation, a little bit of brainstorming here, but you’re actually lessening the amount of family time that we can share with families in other provinces, because it’s kind of a share agreement, right? It actually works quite well.
I just want, one more time, to ask the minister if she recognizes it. She said it’s “my” concern. It’s actually not my concern. It’s my constituents’ concern. The people that pay the taxes in our province — it’s their concern.
One more time to the minister. If she recognizes the concerns, would she not reconsider or talk to government, which made this decision in the first place, without the consent or without the input, really, from what I heard this morning, from the Tourism Ministry, to reconsider? Reconsider this and actually do the consultation that my colleague talked about — to all the hoteliers, the ones that are directly impacted by this — instead of chatter and some emails.
I mean, the minister smirks at “chatter,” but it was her own word. She said she listened to chatter about this, and this is what drove the decision. Then we found out, later, it wasn’t really her decision after all. It was government’s decision.
Would the minister recognize that there are some issues here — it may not have been thought out properly, and that’s okay; we can all learn from mistakes — and take it back and reconsider keeping Family Day the way it is?
Hon. L. Popham: I do understand the member’s concerns, and I’m glad he’s bringing them forward and has a platform to be able to state his views. The fact is that the decision has been made. Family Day is being moved. It was a government decision, and we believe it was the right thing to do for families.
The Chair: The member for Columbia River–Revelstoke.
D. Clovechok: Thank you, Mr. Chair. Welcome back to that chair. I’m glad you’re in this chair and not that chair. I say that with all due respect, of course.
Kind of building off what my colleague was saying here…. We understand that the day is the day and that that decision has been made. Once decisions are made, they’re hard to go back on, even if they are wrong.
The concern, I think, that my colleague is really alluding to is around a process. It’s hard for British Columbians to accept a decision from government when they realize there was really, literally, no consultation associated with that decision. It’s almost like a Big Brother decision. You say you talked to Surrey, and the chatter. I chatter, too, in the grocery store or in the branding yard, with people.
It’s hard to take a decision like this seriously when the Deputy Minister of Labour himself didn’t know that this was happening. What that indicates to us is that nobody knew about this. This was an arbitrary decision that was made for political reasons. That’s fine. But back to what my other colleague said this morning, I think it’s time for the government to come clean and say: “We decided this without a lot of consultation.” The Deputy Minister of Labour didn’t even know about it.
It’s hard to take this kind of decision seriously when you hear things like that. So I’d like to hear your comments.
The Chair: I’d remind the member that asking questions about the Ministry of Labour probably is not appropriate in the Ministry of Tourism, Arts and Culture estimates.
Hon. L. Popham: As the Chair alluded to, I’m not responsible for any decisions or any conversations within the Ministry of Labour. I’m not sure this line of questioning is really around the budget of the Ministry of Tourism.
I’d be very happy to talk to the members about the budget items within the Ministry of Tourism that pertain to marketing our incredible province and our incredible regions to people inside our province and outside our province, making sure that they know why they should come here and making the best case for why we have the best province on earth with the most experiences. That’s what I would be really happy to talk about.
D. Clovechok: Thank you, Chair, for your advice as well. I guess what we can tell people, though, is don’t come here on Family Day anymore because it’s going to be so incredibly busy and expensive.
Just to kind of wrap up on this, if I might, through the Chair, to the minister. Earlier on this morning, you alluded to the fact that you did not believe that there was going to be any negative impact on economies or on families or whatever associated with the change. Is that a safe assumption for me to make?
Hon. L. Popham: What I said was that we understand there will be some impacts, such as on the ski industry. But overall, we believe the benefits for families are greater.
D. Clovechok: I’m going to read you an email that I got at 12:15 this afternoon about this specific issue, whether it be the Family Day…. We’ve talked about the speculation tax. Whatever it is, there are serious ramifications. I received this at 12:15. This is associated with the negative impact to tourism in my area.
“For close to 20 years now, our group from Calgary has been booking our golf weekend in the Invermere Valley. Eagle Ranch has been the regular stop and is one of our favourite courses. However, this year we are not booking our weekend in Invermere or anywhere in British Columbia because of your government’s asinine and offensive actions.
“It is truly unfortunate that working people and businesses, large and small, are suffering in both provinces because of these actions. Our group spends several thousands of dollars on green fees, restaurants, bars….”
And so on and so forth. I won’t say them all.
“It’s probably not going to make an impact, but my friends are doing the same. This extends to other items such as B.C. beer, wine, fruit and vegetables, etc., and so on.
“Please let your MLA know. I believe it’s Doug Clovechok.”
I want to go on the record, Minister, to say that these decisions around Family Day and all these other things that we’ve talked about so far are having a negative impact on British Columbians in the places that I live and in Kootenay East. It’s having and hurting our families. I just wanted to put that on the record.
The Chair: Does the member have a question?
D. Clovechok: I’d like to hear her response to that, yes.
Hon. L. Popham: It’s an interesting email to receive at 12:15. I’m just wondering…. I think the member said that the golf tournament has been happening for 20 years. Family Day has been here since 2013, I believe. So I’m not sure of the correlation between the two.
D. Clovechok: I’m happy to answer….
The Chair: Member, Columbia River–Revelstoke.
D. Clovechok: Oh, through the Chair. Thank you for your patience on that, sir.
The Chair: I remind the member that if you’re using the word “you,” it should be addressed at me and not across the floor.
D. Clovechok: Absolutely. Thank you, sir.
To answer the question — through you, Chair, to the minister — Family Day and the impacts that we’re talking about here…. We talked about the speculation tax, and we’re going to talk about some other taxes here today. You’re true. They’ve been there for 20 years. But the recent behaviour, within a year, after 20 years, through you, Chair, to the minister….
This group of people have decided not to come to British Columbia because of all the things that are going on. That is thousands of dollars of revenue that have now been taken out of the economy of Columbia River–Revelstoke or Kootenay East. That’s the impact that these types of things are having. That’s the correlation there.
It has nothing to do with the length of the tournament. Within the last year, these people have decided, because of the decisions that have been made by this government, that they are not coming. That hurts tourism in British Columbia. We’re not alone in that. Hopefully, that helps.
Hon. L. Popham: Well, they’re interesting comments from the member. Generally, tourism is increasing. In fact, since 2015, it’s gone up by 7.9 percent.
I would suggest to the member that if he is hearing situations about people that may not want to visit our province — the member is a champion for our province — he tell these people why it’s important to come here and that we’ve got the best golf courses in Canada. Perhaps he could be a champion for B.C.
D. Clovechok: Through you, Chair, to the minister: I thank her for that advice. As a matter of fact, I did a radio interview, before coming here today, with 660 in Calgary and did exactly the same thing. So that’s what we’re up to.
Moving along from Family Day. Let’s talk about….
Interjection.
D. Clovechok: Well, we’re not done yet, through the Chair to the minister. We thank the crowd over here too.
We’re going to move on to another tax that is having a significant impact on tourism. Again, I do want to preface this. These taxes have multidimensional, multiministerial impacts. Cause-effect, sequential thinking — when you do something, there’s something going to happen. I put this conversation in the context of tourism, not in the context of a tax that came from the Ministry of Finance. Just to preface that, yet again.
We’re going to talk about the MRDT tax. I’m wondering: can the minister explain how the tax works?
Hon. L. Popham: Thanks for the question. I have a wonderful description of the tax that I am going to read into the record.
The MRDT is a tax of up to 3 percent on the purchase of accommodation, imposed in specific geographic areas of the province on behalf of municipalities, regional districts or eligible entities. The MRDT applies in the same manner as the 8 percent provincial sales tax on accommodation.
The MRDT is used for tourism marketing activities, and given the current housing crisis, it will also be available for housing initiatives for communities that are struggling with housing.
D. Clovechok: To the minister, can she explain to us how the application process works?
Hon. L. Popham: New applications, renewals and rate increases require submission of a completed MRDT application package.
Application requirements include (1) development of a five-year strategic plan and one-year tactical plan; (2) support at least 51 percent of the accommodation providers, representing at least 51 percent of the total number of units of accommodation; (3) consultation and support from local governments; (4) evidence of authority to impose the tax; (5) consultation with tourism industry stakeholders; and, finally, (6) consultation with Destination B.C. to ensure alignment with provincial marketing strategies and tactics.
D. Clovechok: Could you please tell us what the total MRDT estimated revenues are for 2018-2019?
Hon. L. Popham: The fiscal update on 2017-2018 will actually be coming out in June, so we don’t have that as of now. But I can tell the member that in 2016-2017, the MRDT program provided $46.2 million to 54 communities.
This is significantly up from 2014-2015, which was at $30.6 million. It went up to $38.6 million in 2015-2016, and then the numbers in 2016-2017 are $46.2 million. We’ll have the current numbers in June.
D. Clovechok: I just want to ask the question: can the minister explain to us about the MRDT? Is it a voluntary tax, or is it an imposed tax? If it’s a voluntary or imposed tax, can you tell us how that all works in terms of being voluntary in participation with that process?
Hon. L. Popham: It is voluntary. The region has to agree. The hoteliers, the tourism industry, the municipality or the regional district have to agree and come to a consensus that they’re going to move forward on it. So I would say that would be voluntary.
D. Clovechok: Is there a percentage threshold who have to participate to make sure that this is going to go on in a community?
Hon. L. Popham: How it works is supportive — at least 51 percent of the accommodation providers representing at least 51 percent of the total number of units of accommodation.
D. Clovechok: That’s exactly how I understand it as well.
Knowing that it’s a voluntary tax, from a tourism perspective, hoteliers get together and communities get together and the mayors and councils of those communities. They decide, on a voluntary basis, to collect this voluntary tax that is going to be used for marketing purposes, as you said.
Now, there’s a growing chorus in the tourism industry, specifically in the tourism industry, and their stakeholders who are upset about the decision to change the criteria around MRDT funds and how they’re going to be used by the municipalities. Has the minister or the ministry consulted with hoteliers for input into that change?
Hon. L. Popham: We’re meeting with hoteliers. We’re meeting with the tourism associations. I have recently, personally, met with Tourism Victoria to discuss this. But the tax bulletin has not been finalized. With that understanding, we’ve still been holding meetings and hearing the concerns of the industry, which we’ll bring to the Minister of Finance. But it’s important to understand that it is not prescriptive; it’s permissive.
D. Clovechok: We understand that. The question I asked is on consultation. You said you had a meeting here in Victoria. Can you tell us, please, who else you’ve consulted with throughout the province — and a list of those organizations?
Hon. L. Popham: The Tourism Industry Association of B.C. has been in conversations, obviously, and of course, Destination B.C. has been in consultation with their six destination marketing organizations. So that covers the entire province. Then stakeholders that have been directly reaching out, we’ve been taking meetings with — like what happened last week with Tourism Victoria, where I took that meeting personally.
D. Clovechok: Thank you for that answer. It’s really encouraging to see that you’ve been meeting with these tourism associations. That’s a really good thing.
I guess the question that I have for you is: throughout the process of meetings, have you met with hoteliers themselves who are actually collecting this tax to discuss the changes that are potentially coming to them in this process?
Hon. L. Popham: There has been outreach to hoteliers. The hoteliers association has met with the Ministry of Finance.
D. Clovechok: Can the minister share with us the results of those conversations with the hoteliers around the changes that are prescribed?
Hon. L. Popham: We’ve been taking the feedback that the hoteliers have been giving us and forwarding it to the Ministry of Finance. Then, of course, the meeting between the Ministry of Finance and the hotel association was conducted within that ministry.
D. Clovechok: Let’s see what we’ve learned here. It’s a voluntary tax collected by the hoteliers, a 50-plus-one participation in that process. Can the minister explain to us how those dollars, once collected, are allocated and who is in charge of those dollars?
Hon. L. Popham: What I can tell the member is that funds collected under the program are disbursed back to the community for local tourism marketing programs and projects, minus a monthly administration fee of $20 per accommodation, which is provider-collected by Finance.
D. Clovechok: Thank you for that. A voluntary tax collected by the hoteliers. The money goes back into the municipal governments, and they use those dollars for marketing purposes, as described in what you just said. Let’s go right to the issue, now that we know that you’ve got a very good understanding of what the MRDT is.
The addition to this tax is about social housing, which we all believe in. We need to have more social housing. I think, through you, Chair, to the minister, you alluded to that, I believe, yesterday — that the tourism industry needs more rooms. I totally agree with you on that.
The Chair: Member, I’d just remind you: it’s through the Chair. So “you” is me.
D. Clovechok: Did I use “you” again?
The Chair: Well, eight times.
D. Clovechok: Okay. Sorry. All right — you. Thanks for that.
I guess what I would ask of the minister, through you, Mr. Chair, is…. This is a voluntary tax that is collected by hoteliers for specific purposes. That’s why they got into it. That’s why they decided to do that. It was to market their product, and it’s been incredibly effective. Now the rules have changed. The rules have changed, and from what I can see so far, there hasn’t been an enormous amount of consultation with the people who actually collect the tax and agree to collect the tax.
The question to the minister is…. When you want to increase the opportunities for social housing…. What’s going to happen is that social housing advocates in our community — I know them, and I support them — are going to go to the municipal governments and say: “Well, we want some of that MRDT money.” The municipal governments are going to be between a rock and a hard place. They want the social housing, but they’re using money that nobody gave anybody permission to use for social housing because it’s being collected for a specific reason.
If I’m a hotelier, and I’m collecting that tax and I’ve agreed to it, my understanding is that I’m going to collect that for marketing. All of a sudden, through the Chair to the minister, this government has changed the rules without asking me. So what do you see as some potential problems that could be evolving from this change?
Hon. L. Popham: I think it’s important to keep in mind that this change is about choices and flexibility. With that in mind, I’m just going to read into the record what the Minister of Finance said. “It’s entirely voluntary. It’s a discussion that would need to occur with the tourism community and the municipality. Most municipalities are saying that they’re quite happy with the dollars that they have now. They’re quite happy to spend them on tourism. They have a plan in place, and that’s what they’re going to carry out.”
Nobody’s making anybody do anything. The choice will be there if municipalities feel that they need to have some more affordable housing. Let’s just think about a community that is attracting tourists and has a very high…. Their economy is built on tourism. When I’ve been visiting these communities….
I’ve been involved in communications around the restaurant industry and attracting tourism into that to support agriculture. When I talk to these communities, one of the biggest problems they have is around housing. They’re absolutely desperate for housing. So that community may choose, with agreement with the tourism industry and municipalities…. They made decide, together, to flow some of that money into an affordable housing plan. I think that’s a really great way to do it. We’re giving the flexibility for municipalities and the tourism industry to make different choices. Do they have to make that choice? Absolutely not.
D. Clovechok: Before I go along that route, I’d like her, through you, Chair, to the minister, to provide a definition for the type of housing that MRDT funds could possibly be made use of.
Hon. L. Popham: Well, that part of the tax bulletin has not been finalized, but I know that there are discussions around affordable housing, housing for workers — anything that would be of need to that community. I can tell you that — I may have mentioned this yesterday — I was in a community that attracts tourists from all around the world. For one of the employees that works in one of the businesses that supports the tourism industry, his accommodation was a hammock in the woods, with a tarp over it. That’s how desperate this situation has become.
What are the choices for housing? I don’t know. That hasn’t been finalized. But what this will, hopefully, help address is giving accommodation to workers or people that want to live in the community and support that community that is also supporting the tourism industry.
D. Clovechok: Based on that, from my understanding of what the minister just said, it could be any housing. It’s not just housing for the hoteliers. It could potentially be housing for whatever purpose that comes up.
Hon. L. Popham: Well, this would be around affordable housing, but I don’t know what type of affordable housing. Is it for residents in the town? Is it for workers specifically? That is yet to be decided.
D. Clovechok: Just to pursue that a little bit more, sometimes it’s hard to get hoteliers to sign on to this tax. They’re collecting this tax, and all of a sudden, the rules have changed. Those rules are no longer, “You can take these dollars….” So if I’m the mayor of Revelstoke, now I’m facing the social housing people and facing the hoteliers. I’m saying, “Well, this money was collected for marketing, but now I’m being pressured to use it for social housing, employee housing or senior housing” — or whatever housing that you’re talking about.
If I’m a hotelier, I’m going to go: “That’s not what I signed up for. Who asked me permission to do this?” This is a voluntary tax. That’s what I’m asking: who asked the hoteliers’ permission to do this?
Hon. L. Popham: The details have not been finalized in the tax bulletin. That should be coming out soon. Until those details are finalized, what I can assure the member is that this is crafted around flexibility and the ability for communities and the tourism industry to meet their needs. Perhaps those needs will be around marketing and tourism. Perhaps some communities will decide it’s about affordable accommodation for workers. This is about making sure that communities have the tools to meet their own needs around the province.
D. Clovechok: But it’s a voluntary tax. It’s collected by the hoteliers. Nobody has asked them permission to use these dollars for anything other than that.
Does the minister foresee any problems with hoteliers down the road not wanting to play this game anymore? They’ll just opt out of the MRDT tax. Now you have no money for marketing. Now you have no money for social housing. You have no money at all.
I’d appreciate those comments.
Hon. L. Popham: I’m just going to repeat for the member a part of the requirements for the application to use this fund. There would need to be support of at least 51 percent of the accommodation providers, representing at least 51 percent of the total number of units of accommodation.
D. Clovechok: I understand that, but that didn’t answer my question. It is: do you foresee any issues associated with hoteliers opting out of this tax if it’s going to be used for other things than what they signed a legally binding contract for? That said that these funds are to be used for marketing purposes. Now they’re being told that what they do as a hotelier, collecting these monies, can be used for something else. They didn’t sign up for that. Do you see any problems coming forward from that?
Hon. L. Popham: In the cases that I know, specifically, the hoteliers have a good relationship with the community that they’re operating in. There has to be agreement between the hoteliers and the municipality or regional district. This is a collaborative approach that they would use. I would think that the hoteliers would see the same benefit that the municipality would see, as far as providing either accommodation for workers or low-cost housing. I would think that this would be a whole-community benefit.
The MRDT has brought tons of benefit as far as the tourism industry is concerned. I wouldn’t see a community working against that, because this is to be a collaborative approach.
D. Clovechok: Collaboration is great in communities. We all need it, and we work towards that. But again, the contractual agreement that was made, between the hoteliers, the province of British Columbia and the municipal districts that they serve, was made for the use of these dollars as marketing dollars.
Are there going to be renegotiated contracts now that, potentially, there’s going to be a social housing component to that? Are they going to have to revisit those contracts and open them up to get those hoteliers to agree to collect the tax that could potentially be used for social housing or any kind of housing?
Hon. L. Popham: We do not anticipate reopening existing contracts, because the contracts have registered a five-year plan. With that in mind, there could, potentially, be changes made. But as we know, the MRDT has had extreme success for tourism in the areas that are using it.
I’ll go back to the idea that municipalities, regional districts, the tourism industry — they’re working together. These are successful contracts, and the feedback on them is positive. I can’t imagine that if a region wants those dollars going into tourism, there would be some sort of problem with that.
Some communities have voiced the fact that there is an absolute lack of affordable housing for their workers and for residents of their towns, while they attract visitors to their regions. So I think this is going to allow them to be able to deal with that as they see fit.
D. Clovechok: I couldn’t agree with you more. Even in my own riding, whether it’s in Revelstoke or Kimberley or through the Columbia Valley or Golden, housing is important. There’s no question about it, especially around the tourism industry.
The question to the minister is: does she feel that all the hoteliers that are collecting the tax and have signed these contracts will be open to this new change? Or have they consulted directly with those hoteliers? Does the minister believe they’re supportive of that?
Hon. L. Popham: What we know is that they want clarity on this issue, and we’re working as fast as we can to get them that clarity.
D. Clovechok: That’s great to hear. Clarity is really critical on this.
I’ll just tell you, for the record…. I’ve just got a few of them here, but there are stacks of them in my office in Kimberley. These are letters from the Revelstoke accommodation group, from Tourism Golden, and the list goes on and on. Hoteliers are not happy. They are far from happy. They do not want this tax to be used for other than marketing. I’ve got stacks to prove that.
The only tourism area I’ve heard that was actually in support of this was Tofino. Could the minister explain to us or tell us or share with us if any other communities that they’ve talked directly to said they’re supportive of this?
Hon. L. Popham: Thank you for the question. I think that the best answer I can give the member is that we know that the hoteliers want clarity on this. I think once we have that, then some of this discussion can continue, if it needs to. At this point, there aren’t enough details for me to predict what’s going to happen.
D. Clovechok: That’s a fair comment. Any idea of when there might be clarity?
Hon. L. Popham: I can tell the member that we’re working with the Ministry of Finance to have that issued as soon as possible.
D. Clovechok: Could the minister explain what actual clarity in this issue would look like? The clarity for us over here is that, contractually, there is an agreement between hoteliers in communities to collect taxes. That’s the clarity. So what’s the new clarity? What clarity are they waiting for? That’s what my question is.
Hon. L. Popham: What I could tell the member is that some of the things that may be clarified in a tax bulletin would be: the definition of affordable housing, when would it apply, what portion would go towards housing, if there’s anything around timing and then any restrictions that would happen. I mean, those are the things it could clarify. Until we actually see that tax bulletin, I would say that that’s our best guess.
D. Clovechok: Given the new potential change MRDT will create for communities, I’m just wondering if the minister has considered whether tools like RMI will have to be changed to make up what can be potentially lost tourism revenue through the loss of marketing if hoteliers actually decide to opt out of these contracts after the five years and not redo them again.
Where are those moneys going to come from to continue the marketing if this program fails, which has been incredibly, as we’ve already noted, successful? But I have stacks of examples here where hoteliers are saying: If this happens, we’re out.
Hon. L. Popham: As the member most likely knows, RMI is for infrastructure and events, and it’s not used for marketing in the same way that MRDT is used. There won’t be any changes to RMI because of MRDT.
What we feel is that the MRDT will continue to be successful, and it’s growing in its popularity. Right now there are 56 communities that use it. That’s increasing. As far as RMI goes, there wouldn’t be any money available to use for marketing from that fund.
D. Clovechok: That’s good news to hear. From that perspective around the MRDT, then, would Destination B.C.…? I’m doing some systemic thinking here and kind of forecasting a little bit, which is frightening, I know. But if you think about the loss of this revenue, because of the change, which has been relatively, for what I can glean, very arbitrary with very little consultation in the industry….
If hoteliers opt out of this because of this proposed change, which I have documented proof that that’s going to happen, would Destination B.C. have additional marketing dollars to fill in the hole that is created because of this? Cause and effect — cause being the change to the MRDT, and the effect being people are pulling out of it. The consequence: no marketing dollars. So now what happens?
Hon. L. Popham: Because of the success of MRDT, we don’t anticipate hoteliers pulling out. But as the member suggested, he does have constituents that have mentioned that that might happen.
The thing about the Tourism Ministry is that we know how important tourism is to the province. It’s a $17 billion industry here. The province invests $113 million into the tourism industry, so this is not something we take lightly. In fact, Destination B.C. is specifically built to market our province. We are continually coming up with campaigns to make sure every corner of our province has an opportunity to take advantage of tourism dollars, and we will continue doing that.
We will have to see what happens when the legislation comes out, but I would suggest to the member the importance of the tourism industry means that we will continue to support the tourism industry in the way that’s needed.
D. Clovechok: To the minister, I appreciate her words.
The last thing I’ll say on this MRDT — we could go on all day, and we’re not going to — is that…. This is more of a statement than a question. What’s happening here, and because the legislation hasn’t been completed yet, so there is some wiggle room here still…. I would say, as a statement around MRDT, that this is a very slippery slope, and I would welcome the opportunity for the minister, around her cabinet table, to convey that message. It’s not just my riding. These letters are from throughout the province — who collect MRDT. It is a slippery slope, and it’s something that’s going to have a consequence. If your head’s in the sand, you’re going to get buried by it. So just to keep that in mind.
Hon. L. Popham: I appreciate the member’s words. I would say that our heads are not in the sand, as we are listening to stakeholders around the province. But I would invite the member, if he wishes, to share those letters with me so that I can then hand them over to the Finance Minister.
M. Stilwell: In relation to MRDT but also talking about Airbnb, as it relates to accommodations in the province…. It’s growing, and many, many people are finding their way to using Airbnb.
The NDP platform committed to ensuring that short-term rental operators are contributing fairly to tourism marketing programs. Does the minister have a plan to institute the MRDT or have Airbnb providers collect that tax, as well as other home-sharing services other than Airbnb — VRBO, etc.?
Hon. L. Popham: Thanks for the question. Airbnb will collect the 8 percent provincial sales tax and, where applicable, the up to 3 percent MRDT on all of its accommodation in B.C., subject to legislative approval. I can let the member know that the province is going to be looking to move forward with similar arrangements on other on-line platforms in the near future.
M. Stilwell: Have any municipalities applied or expressed interest in the MRDT 3 percent tax after the Airbnb announcement happened?
Hon. L. Popham: We will have to check with the Ministry of Finance and get back to the member on that.
M. Stilwell: The first estimate was roughly about $5 million per year from the Airbnb MRDT tax. Do you believe that still to be the estimate for tourism?
Hon. L. Popham: Yes.
M. Stilwell: Perfect.
Could we possibly recess for a few moments?
The Chair: I decree a recess of five minutes. Seven minutes — correction.
The committee recessed from 2:50 p.m. to 3:02 p.m.
[D. Routley in the chair.]
D. Barnett: As you know, in the Cariboo-Chilcotin, we have a title case. Land was given to the Xeni Gwet’in First Nations by the Supreme Court of Canada. In that Supreme Court of Canada judgment, there were no rules. There were no regulations. There was nothing.
I have many tourism operators within these title lands that have not been able to go to work. This is a first-class, world product, where we bring people from Belgium, from Germany, from all over the world to this first-class tourism product. As they have not been able to sell their product, they have not been able to make any income.
Is the Minister of Tourism prepared to assist these tourism operators through a financial aid package before they lose everything they have?
Hon. L. Popham: Thanks for the question. The lead on that is actually the Minister of Indigenous Relations, but what I can tell the member is that there have been discussions between First Nations and tourism operators. The role that we have played is more of a facilitator role, and because there are negotiations happening right now, I’m unable to discuss any details.
D. Barnett: Thank you for that response. I have one more question. We also have treaty negotiations going on in my riding with the Northern Secwepemc. These treaty negotiations have been going on for 24 years, and there doesn’t seem to be an end to the treaty negotiations.
Many tourism operators have tourism facilities on Crown land. They have leases. They have all these things. Of course, the concern is that once the negotiations finalize, if they ever do, it will probably impact the businesses.
Is the Tourism Minister prepared to assist these tourism operators within treaty negotiations to help them be sustainable in the long term?
Hon. L. Popham: Thanks to the member for the question. Again, the lead on that is the Minister of Indigenous Relations. Because those are negotiations that are ongoing, there is nothing for me to discuss around any compensation. That would be something that would be involved with the negotiations.
J. Yap: I appreciate the opportunity to ask the minister some questions. In regards to museums, which, of course, are a very important part of our cultural fabric and a tourism product…. The Pacific Canada Heritage Centre, Museum of Migration, is a very unique collaboration that is seeking to establish a west coast museum of migration — similar to the facility on the east coast, in Halifax, known as Pier 21.
This group, Pacific Coast Heritage Centre, Museum of Migration, has been working over the years to, first of all, establish itself. They’ve done good work in reaching out to diverse communities to tell the story of migration that talks about the Pacific side of migration to our country and the history of migration and integration with our First Nations heritage as well, in contrast to the Pier 21 Museum that speaks to the rich history of Canada from a perspective of European migration from the Atlantic side.
This group has been working hard to establish themselves. They’re a virtual museum now, but they would like to be an actual museum with a facility.
My question is: what infrastructure funding might be available to groups that are proposing worthy projects such as this museum is proposing — or wishing to — in terms of getting started on a program to build a physical museum?
Hon. L. Popham: Thanks for the question. I love museums, so I’m really interested in that project myself, personally. I can tell the member that currently what is available are grants through the Arts Council. That would be funding that would be able to help with business cases or proposals that are being developed. I don’t know if that is helpful information.
There is, potentially, some money — provincial, federal money — coming forward for projects, but that isn’t defined yet. We can absolutely keep the member up to date when that’s a possibility.
J. Yap: Thank you for that, Minister. The Pacific Canada Heritage Centre, Museum of Migration, folks had heard that there was a potential — $30 million was the figure they heard — infrastructure program that might be available for groups such as theirs to access. Can the minister confirm if that is the case and if it’s what she had referred to in her answer?
Hon. L. Popham: What I know so far is that the B.C.-Canada bilateral agreement has been signed, and the community, culture and recreation stream of the Investing in Canada infrastructure program has a federal allocation of $157 million over ten years, which covers both sports and arts capital infrastructure. The final details of that have not been worked out, but as I said, we can absolutely inform the member when we know that.
J. Yap: I appreciate that. Would the minister be able to give some sense of the timing of when those final details would be worked out? In anticipation of her answer, I would appreciate and will take her up on her offer of keeping me informed on the progress.
Hon. L. Popham: Unfortunately, I won’t be able to give a timeline. It’s working with the federal government, and so we don’t know when it’ll happen. But again, we’ll keep the member informed.
J. Thornthwaite: Now for film questions. I’ve just got one or two.
The last time I spoke with the minister at estimates, we talked about one of the items that was in the mandate letter with regards to British Columbia getting their fair share of federal grants like Telefilm Canada, etc., and the fact that as much as our taxpayers are paying equally into that fund, the majority of the benefit goes to either Quebec or Ontario. So I’m just wondering what the progress is with the minster on that file.
Hon. L. Popham: Thanks for the question. Since the last estimates process, the minister has established a round table on Canadian production in partnership with the Knowledge Network, the Canadian Media Production Association and Creative B.C. This is to explore and increase support for B.C. producers and to attract more federal investment into the province.
Staff have initialized that round table, and we’re just waiting for the minister to return, hopefully in the next couple of weeks, to move forward on that.
J. Thornthwaite: I would be very appreciative of any update on that, when that information is available.
Then the next question I have is from a director friend of mine, a very successful local director. He’s talking about a tax incentive for the hiring of B.C. resident film directors for film or television series work. The reason being is that that’s a…. It would be a huge gain, obviously, for our sector and would help our employment numbers in the province. Now everything is in favour of the American and British and South American directors. Their members, our members, find it hard to compete, largely because they don’t live in LA, and that’s when the hiring decisions are made.
He was suggesting whether or not the ministry would consider a tax incentive for the hiring of resident film directors. He’s actually given a number of 3 percent. So maybe a comment from the minister on that.
Hon. L. Popham: What I’ve learned is that we’ve never had a formal request for a tax benefit like this come through this ministry. Of course, any tax changes would go through the Ministry of Finance.
It’s great that the member has brought this up here. If the member would like to encourage her director friend to send forward some information or to start that dialogue….
Also, this is going to be the type of topic that is going to be crucial to come to the round table. Again, another reason for that information to come forward.
Thank you, Member.
J. Thornthwaite: Well, that sounds great. Perhaps the minister or the minister’s staff could pass me on that information so I can pass it on to my director friend, who is part of the directors guild, actually. Your staff probably know who he is.
Anyways, that’s all I had, and thank you very much for your quick, prompt answers. Much appreciated.
T. Wat: First, I’d like to thank the Agriculture Minister for taking on this estimates debate, and I would like to convey my regards to the Tourism Minister. I wish you could send my regards to her. I’m hoping to see her back in this building soon.
On to multiculturalism. I notice in the service plan that there’s a $645,000 increase in the multiculturalism funding. I want to know exactly how this additional funding is going forward.
Hon. L. Popham: Thanks very much to the member for the kind words about the minister. I will convey your thoughts. Thank you.
The multiculturalism division has an overall budget of $2.276 million, and how that is broken down is: $300,000 for multiculturalism grants; $252,000 for the expanded B.C. Organizing Against Racism and Hate program; $272,000 for projects, events, advisory council, engagement activities and operating costs; $1.165 million for staffing costs; and $287,000 for transfer.
I don’t see an increase in the budget that the member refers to. I’m asking if the member could clarify.
T. Wat: I’m just looking at the overall budget of multiculturalism.
Would the minister go through…? Just now, she listed out categories 1 to 4. Can she explain in detail the four categories that she is talking about?
Hon. L. Popham: Thank you for the question. There is $300,000 for multiculturalism grants. I don’t know if the member needs more details on that, but we can get into it — $252,000 for the expanded B.C. Organizing Against Racism and Hate program. This supports 36 communities across the province. Each community gets $7,000 from that fund. There’s $272,000 for special projects and events, and then the remainder of the budget is for staffing costs and other small projects.
T. Wat: Thank you, Minister, for the breakdown. I guess the $400,000 budget for the grants is the same as the past year?
Hon. L. Popham: Yes, it’s exactly the same.
T. Wat: How about the criteria for the granting of the funds? Is it the same as before, or are there any new criteria?
Hon. L. Popham: It’s the same.
T. Wat: Thank you, Minister. Again, for the hate program, for the OARH — $252,000. Is it the same as before? I will go to that particular program later on. I understand that there is an increase in four communities. Is it the same amount, or has there been an increase, given that we increased by four communities for this program?
Hon. L. Popham: The member is exactly right. There has been an increase of four communities, and those communities will receive $7,000 as well.
T. Wat: Does that mean that with $7,000 for one community, there’s an increase of $28,000 in total?
Hon. L. Popham: Correct.
T. Wat: Thank you, Minister. On the other breakdown of the special projects — $272,000. What kinds of special projects are those?
Hon. L. Popham: Thank you for the question. These events included advisory council meetings, such as for the Multicultural Advisory Council, and community recognition events, such as the celebration legacy book event planned in Vancouver, and also some program events such as the Organizing Against Racism and Hate program. Members were brought together for a day to discuss best practices for engagement. Then any new projects identified through the new multiculturalism strategy, which is being currently worked on, would also fall under this category.
T. Wat: Thank you, Minister. Those events…. I know that the celebration book was already held. How about the events that you referred to? Have they been held, are they being planned, or are they going to be held in the months to come? I would appreciate it if I would be informed about those events when they take place.
Hon. L. Popham: The Organizing Against Racism and Hate program date was held. The celebration legacy book event was held, as the member knows. The other events — we are taking the lead from the Multicultural Advisory Council on the dates. But we will definitely inform the member of those upcoming events.
T. Wat: Thank you, Minister, for the response.
I just want to go back to the $300,000 grants. Have those grants been granted — that funding?
Hon. L. Popham: Yes, those grants have been granted, although the money has not left the ministry yet. They are just doing public notification now. At that point, if the member would like a list of those grants, we’d be happy to provide it.
T. Wat: Thank you, Minister.
I don’t know how…. Was it done this year…? I don’t know when that happened. I remember in the days when I was a minister, we were informed — all the MLAs in all the 85, now 87, ridings — about the fact that these kinds of grants are being considered. The MLAs were informed so that they could, in turn, inform their constituents and the organizations in their ridings to apply for the funds. So I don’t know how it was done, but I’m hoping that, moving on, the same practice can still be used.
Hon. L. Popham: The applications began in November, and decisions were closed in January. Currently the recipients are being informed, but I can assure the member that MLAs will also be informed, so they can take part in any notice that’s being sent out.
T. Wat: I would appreciate if I could be given a list of those recipients after this is all announced.
Hon. L. Popham: Absolutely.
T. Wat: Earlier on, in your first response to my question, I remember the minister did mention there was a transfer of $287,000. What kind of transfer was that?
Hon. L. Popham: That was for special projects, and some of them I’ve mentioned already. They included the advisory council meetings, funding for that — that will be upcoming — then the Multicultural Advisory Council and, of course, the celebratory legacy book event. All of that is part of special projects.
T. Wat: To the multiculturalism division, I must thank the deputy minister and staff who were giving a briefing to my colleague and myself earlier on, and we were given an organization chart of the multiculturalism division. From that chart, I notice that four positions are not filled, including the director of programs and grants, public education officer and project coordinator. Have these positions been filled now?
Hon. L. Popham: Thank you for the question. One position has been filled, one is currently being advertised for, and two are outstanding.
T. Wat: Which position has been filled? What is the timeline for filling all those positions?
Hon. L. Popham: The first position that has been filled got filled two weeks ago. That’s for the administrator. The one that is posted currently is for a director. That should be filled by the end of June. The two that are outstanding are going to be based on the amount of workload that is coming.
T. Wat: Now to the pet project that I’m so interested in, the legacy initiative. The Legacy Initiative Advisory Council, LIAC, has been in place for three years. Your government has extended their mandate for three additional months. The Minister of Tourism had one very short meeting with LIAC since she took the portfolio. LIAC is now disbanded. And yet, there are still some legacy initiative projects that have not been completed.
The former government has committed to unveiling the plaques of 15 historic sites throughout the province. Five plaques have been unveiled by the previous government, and one plaque was unveiled by this current government, actually by the Premier. That means there are still nine to be unveiled.
I understand from a conversation with the executive director during the days when I was a minister that both the plaques in Yale and Lillooet were all completed. It’s just waiting to be unveiled. I understand that those will be unveiled in July. I wanted to see whether the time has been set.
Obviously, I’ve been to those two places many times. I’d love to be informed and be there for the unveiling of the plaques.
Hon. L. Popham: The member has asked whether or not we would inform her of an invitation to the events of the unveiling of the plaques in Yale and Lillooet. The answer is absolutely yes. The date hasn’t been finalized. It has to be decided on by a committee, still. Of course, this is a community event, so the community has to be brought in, as well, on the timeline.
The member can be confident that she will be informed and invited.
T. Wat: Thank you, Minister.
The reason why I want to put on record that I had been informed is because when this government unveiled the first plaque that this government unveiled in Victoria in Chinatown, I wasn’t informed. And I was approached by the community leaders to ask me to go there. That’s why I turned up, and that’s why I brought this up today, just to make sure that I’m invited.
There are still seven plaques that have not been unveiled. So with these two…. That makes seven now. Can I have the timeline on when the seven will be unveiled? Will it be done in this year? Are they going to be done?
Hon. L. Popham: Thank you for the question. I understand the significance of the plaques that the member is talking about. Originally, when the ideas around the plaques came up, there was a commitment to do up to 15, depending on the budget. As the member knows, there was $1 million provided for this initiative. That money has now run out.
We are very happy to work with the Multicultural Advisory Council to make any future plans for the remaining seven plaques that the member has mentioned. At this time, there is not a plan to do so — but very interested in working on that.
The Chair: The member for Richmond-Steveston — Richmond North Centre.
T. Wat: Thank you, Mr. Chair. It’s easy to get confused. We have four ridings in Richmond.
Thank you, Minister. Well, I guess I can say, on behalf of the Chinese community, that I’m somewhat disappointed to hear that there’s no immediate plan to continue the unveiling of these other remaining seven plaques in the historic site. I guess the expectation from the Chinese community was that the previous government had that commitment. And even with the change of government, it’s difficult for the Chinese-Canadian community to imagine that with a different political party in place, issues such as this can be changed midway.
I strongly urge that this minister convey to the Minister of Tourism that…. Actually, the unveiling of a plaque doesn’t cost that much. It’s only…. Well, your staff can give you the budget. I’m sure you have to consider the anticipation and the expectation of the Chinese-Canadian community.
Hon. L. Popham: I absolutely understand what the member is saying. I think the previous commitment from the previous government was up to 15, depending on the legacy budget. At this point, the legacy budget has run out. We’re very happy to work through the Multicultural Advisory Council to continue on with a plan, but at this point, the commitment of the previous government actually has been fulfilled. It was leading up to 15, unless the money ran out.
Unfortunately, that may sound to the member like we don’t have that commitment, but we are absolutely interested in continuing. We just need to regroup now and take a look at budget and work with the Multicultural Advisory Council to have a plan moving forward.
T. Wat: Well, this is not a matter of another $1 million. This is a matter of maybe a couple of thousand, a few thousand dollars. I’m sure the ministry, within the ministry, can easily transfer from one vote to the other.
I wonder if the Tourism Minister…. When she had the meeting with the Legacy Initiatives Advisory Council, did she ever bring this up to the notice of the 22 members of this council to let them know that because money has been used, that’s why this government cannot continue the unveiling of the plaques?
Hon. L. Popham: Thank you again to the member. I know how important this is to the member. It’s also important to British Columbia.
The situation right now is that we do have this Multicultural Advisory Council. It’s very important to take the lead from that council, so we’re waiting for that to happen. We’re very much looking forward to any of the ideas that they bring forward. If this is a priority to them and they bring that message forward to the minister, then the minister will proceed as necessary.
I hope that the member is not communicating that our government is not supportive of the unveiling of these plaques. In fact, we are. The commitment of the previous government was “up to 15.” It wasn’t “to 15.” We would very much like to continue, but we will take advice from the Multicultural Advisory Council. That being said, I hope the member understands that we are supportive of the program.
T. Wat: Thank you, Minister. I do take issue with your comment that you hope that I’m not communicating to the community. It’s up to the community to feel whatever they feel. I mean, this is open debate, and I’m just bringing it up that I’m disappointed. I anticipate the same kind of sentiment from the community. I’m just conveying what I heard from the community to the minister. Don’t get me wrong. I mean, the judgment is going to be made by the community, not by me. By not continuing, it’s obvious that the community will feel that there’s something missing.
You are right that we committed to up to 15. But then I remember — I don’t have the transcript in front of me — when I brought up this issue with the Tourism Minister, I brought up the plaque in Vancouver Chinatown. I talked about that we started the concept by a Chinese Canadian, a well-known architect who passed away. I remember the minister — as I said, I don’t have the transcript with me — said that the ministry had been talking to the Vancouver city council.
Vancouver Chinatown is one of the largest legacies in British Columbia. The Vancouver Chinese Canadians have a high expectation and anticipation that a plaque will be unveiled.
We did engage in discussion about unveiling a plaque in Vancouver Chinatown. I’m sure your staff remember that. This is something that was being discussed. If this one is not even going to be unveiled, I can say that this is an extremely big disappointment to the community.
Hon. L. Popham: I understand the member’s passion, and I certainly wasn’t stating that the member is communicating to her community that this isn’t going to happen. But it seems to me that the member thinks that the program is over and we’re not interested anymore.
I hope that this is good news for the member. We have been working with the city of Vancouver, and there is $100,000 put away in trust in order to facilitate the unveiling of the plaque in Vancouver. I can assure the member that an invitation will be coming to her as soon as that is sorted out.
T. Wat: Thank you, Minister, for the answer. I’m glad that I pursued this line of questioning. Otherwise, I wouldn’t have known that there’s $100,000 that was put in place. I’m wondering why this was not given to me earlier on, in your response to me.
Hon. L. Popham: Perhaps it’s just a matter of the terminology. This is a commemorative monument — the one in Vancouver. I was assuming the other ones were plaques. But I’m surprised that the member wouldn’t know about the $100,000 put away in trust for this monument, because it’s my understanding that it was put into trust while this member was the minister.
T. Wat: Whatever is put in by the previous government can be changed by this government. You never told me about this, and your staff is fully aware that plaques are the same as a commemorative monument — the 15 plaques or monument that we are talking about.
That’s why it goes back to my concern that many of the senior staff, except one, have been transferred out of the multiculturalism division. Maybe because many of the staff who have been working on this project have been transferred out is why there is no continuity in the staff working on this legacy initiative project. That’s why I’m concerned and asked earlier on: have the positions been filled?
Going back to my earlier question that I asked this minister about whether the Tourism Minister brought up the fact that we might not have enough budget to fulfil the 15 plaques that are going to be unveiled…. The minister, earlier on, had not responded to my question.
Hon. L. Popham: Yes, the minister did meet with LIAC and discussed the work that had been done. The minister gave her gratitude to the committee, and what was also discussed was the future unveiling of two more plaque monuments. The Vancouver monument was one of them.
Moving forward, the Multicultural Advisory Council will be working hard to come up with priorities. That will be part of the plan moving forward. Perhaps more unveiling of plaques will be part of that, but it’s really important to have respect for the priorities of that committee and take their lead.
T. Wat: Again to the minister, has the minister brought up the fact that the ministry might not have enough budget to continue at least a minimum of 15 plaques to be unveiled? Has the minister considered talking to the 22 LIAC members to lobby them if the ministry does not have enough budget? Would the community be willing to fund those plaques? Has this ever been brought up for discussion?
Hon. L. Popham: Well, I would like to say, again, that we would take the lead from the direction that the Multicultural Advisory Council would like. Of course, as the member knows — as the member was a former minister — as needs or pressures on budgets come up, you address them at that time.
T. Wat: Thank you, Minister, for the response. With due respect for MAC, the Multicultural Advisory Council, I understand that there are two Chinese Canadians that are on that council. Correct me if I’m wrong. And here we are. We have 22 members in the Legacy Initiatives Advisory Council. Not all of them are of Chinese descent, but most of them are, and they are very knowledgeable about Chinese-Canadian history and also knowledgable about the Chinese community. Is there any consideration of or any thinking about inviting them together to have this discussion?
Hon. L. Popham: The minister’s Multicultural Advisory Council, at the discretion of the chair, can meet with any stakeholder groups and also set up subcommittees. So if the chair sees fit, that’s absolutely an option.
T. Wat: Thank you, Minister. I hope that that will be under consideration.
Going back to the Vancouver Chinatown monument. Is there a timeline of how it’s going to be implemented?
Hon. L. Popham: Currently we’re working very closely with the city of Vancouver. The timeline on that will depend on the decision that’s made with the city of Vancouver. As soon as there’s more information, we will be happy to let the member know.
The Chair: Members, at this point, this committee will take a brief recess — approximately ten minutes.
The committee recessed from 4:01 p.m. to 4:09 p.m.
[D. Routley in the chair.]
T. Wat: Just to go back to the last question and response from the minister. Given that the municipal election will be held in the fall, I hope that the discussion on this commemorative monument can get underway as soon as possible so that it won’t be disrupted by the municipal election.
Hon. L. Popham: Thanks for the question. I understand the member’s concerns about the municipal elections in September. Just to assure the member, there will be some continuity.
We have a Vancouver advisory committee on legacy. That’s through the city of Vancouver. They will be working on this. This is not an elected committee. This is a committee that will stay solid through the election cycle, if it goes that far. I’m not sure of the timing.
The one thing, also, that I think the member can feel good about is that George Ing, who sat on IAC, is also on that Vancouver advisory committee.
T. Wat: Thank you, Minister. Yeah, I do understand George Ing is on that committee. Thank you for the information.
On to another Chinese-Canadian project. I’m really glad to see that the B.C. Chinese history museum was mentioned in the service plan. That was a concept the Premier brought up during the election campaign. Again, he reiterated it in his promise to the Chinese community in October 2017.
In the service plan, it said that the ministry would develop the concept plan for the B.C. Chinese history museum. Can I know more details about how this developing is going on?
Hon. L. Popham: Yes, a very exciting idea. I’m excited about it myself. As the member will also know, the Premier convened a Premier’s Chinese-Canadian Community Advisory Council. I’m excited about that.
One of my constituents, Thomas Chan, is on that council. He’s from Saanich South, so that’s exciting for me to have that connection.
This committee will work. The Premier chairs this committee, so he will work with this committee as they move forward on plans and move towards a conceptual idea.
T. Wat: Thomas Chan is my good friend. In the initial announcement, I did not see his name there. Was he newly added? Sorry to divert.
Hon. L. Popham: Yes, he was, and I’m very excited about it.
T. Wat: If I want to have more details about this Chinese history museum, should I ask questions at the Premier’s office budget estimates debate, or can the minister give me more information?
Hon. L. Popham: So that the member knows, we are in the very earliest stages of exploring many different museum concepts and funding models. This ministry will be the lead, so the questions can come through this ministry. But I would like to let the member know that as we have updates, we will make sure to inform the member as we go along.
T. Wat: I’m glad to hear that there’s a funding model. So if there’s a funding model, I hope and still urge that consideration should be given to the unveiling of the 15 plaques, because those and many other plaques cost a minimal amount of the budget. I hope that will be under consideration.
Moving on, I see that in the service plan, there’s talk about a multiculturalism strategy. Goal 4 of the minister’s service plan stated that “work is underway to create a new multiculturalism strategy that will further reflect and guide this important vision for a more inclusive society.” Can the minister give the House more measures or targets that are being prioritized in the new strategy?
Hon. L. Popham: I can let the member know about our new multiculturalism strategy. The focus will be on strengthening the multicultural society, encouraging cross-cultural engagement and innovation, and challenging racism and hate in its many forms.
One of the things that will also happen is a relaunch of the B.C. Human Rights Commission. It will, of course, lead in all overall human rights work in B.C., but we recognize that a strong multiculturalism strategy will benefit from a strong human rights commission.
The parliamentary secretary will also be engaged, as well as the Multicultural Advisory Council.
T. Wat: I’m glad to see that we are really putting a lot of attention into the multiculturalism strategy.
Since I do not have enough time, I am trying to rush through some of the questions I want to ask.
Maybe the minister can give me some more examples of how to facilitate the development of partnerships and relationships across B.C. multicultural communities. It sounds very good, but I don’t know how it’s going to be done. Also, on how to support cross-cultural and cross-group collaboration on events and opportunities, I don’t know whether there are any examples that you can cite now that we have done to demonstrate that.
Hon. L. Popham: Thank you for the question. It’s a very important topic. I can tell the member that the work is underway.
The member did want some examples of things that have been done so far. One of the things that the $300,000 grant program does is it sends money out the door into groups that are working on just this kind of thing. An example of that is the many incredible food festivals that happen throughout the province focusing on cultural food. That’s one of the examples that’s happening right now.
The member did mention that she felt she was a bit short of time. I just wanted to offer to the member that if she doesn’t have time to ask all her questions, she’s very welcome to write her questions down and submit them, and we’ll get them back to her in a timely manner.
T. Wat: Thank you for that offer. I’m going to suggest that I’m going to submit questions. Hopefully, those questions can be answered within a reasonable period of time.
Do I have time for a couple more questions? Okay.
On to the inclusive language. Again, I see in the No. 4 goal in the service plan that the ministry aims to promote the use of inclusive language. What does this strategy look like to the minister? How does it work in practice? It sounds really good — inclusive language. But how does it really work across all ministries?
Hon. L. Popham: Thank you for another important question from the member. We definitely recognize that within government, using language of inclusivity is critically important. As we try and modernize the way that we do things, we recognize that this has a high priority. So it’s very timely.
Tomorrow we will be releasing across government, across ministries, an inclusive-language guideline. We would be happy to send a copy of that to the member after it’s released tomorrow.
T. Wat: I guess the timing of my question is just perfect, and I guess I will ask more questions in next year’s budget estimate after I study your guideline tomorrow.
On to B.C. Multicultural Awards. The province has been giving this award for many years to organizations, individuals, business and youth. Since 2008, the awards actually grew from two to five. Actually, the awards were donated back to the community association. But then in 2017, I didn’t see any award ceremony, and I just wonder why.
Hon. L. Popham: Thank you for the question. So 2017 was considered a transition year for the awards. The Multicultural Advisory Council will be assessing the awards, and we’ll be taking advice from that committee.
T. Wat: Thank you, Minister, through the Chair. Does that mean that this award might be discontinued?
Hon. L. Popham: Thank you for the question. We will be taking advice from MAC. The reason is because this award has existed for quite some time, and maybe because we have a new council now, this would be the time to reassess it and not necessarily stop doing it but look at new ways to provide it. That could mean expanding categories. It could mean changing categories. But the goal would be to figure out the very best way to recognize multiculturalism.
T. Wat: We are running out of time. My colleagues still have questions relating to the bigger ministry, even though multiculturalism is definitely very important. So I will submit more questions that I haven’t been able to ask, and I’d like to thank the minister for taking the time to have such a constructive and productive dialogue. Even though you’re acting minister, you are truly the minister. Thank you, Minister.
M. Stilwell: It’s nice to be back and asking you…. We’re almost done. We’re rounding the end of the day. There are looks of relief on everybody’s face over there.
[S. Chandra Herbert in the chair.]
We’re going to ask a couple of questions in regards to the B.C. Arts Council. So $15 million over three years to the B.C. Arts Council is laudable, but it’s not what the minister has been mandated to deliver.
The minister’s mandate letter says that she will work to double the province’s investment in the B.C. Arts Council over four years. Instead, $5 million a year for three years only amounts to a 62.5 percent increase. That’s certainly not doubling it. It’s not quite getting there exactly, unless the minister plans to pump $9 million into the council in the fourth year.
I’m wondering if this is a promise that won’t be coming to fruition. Is the minister walking back on the doubling of the investment into the council?
Hon. L. Popham: Thank you for the question. I understand what the member is saying, but this is the first year of a four-year mandate, and the $5 million going into it this year is the first investment that’s been made in five years. So we’re looking at…. What’s written into the mandate is $15 million over the committed time in this mandate. But it is the first year, so we will be looking at ways to support the arts in B.C. in the best way that we can.
We have heard loud and clear from this sector how they would like to be supported, and we also know how important they are to our communities across the province. So I’m really happy to see the first part of this investment happening this year. I know we have received positive feedback. As the member knows, as she was in government, there aren’t endless amounts of money, but we think this is a good start.
M. Stilwell: I would agree. It is a good start, and of course, it was a promise that the new government had made, so I would expect that with the promise that you made, you will keep it to the people you made the promise to, which would be the B.C. Arts Council. So I’ll be watching closely to watch those numbers go up in following years.
In the fall estimates, the minister was asked about performance metrics that could help determine how the increased funding for the B.C. Arts Council was going to happen over the next four years and how the ministry would be able to document where it will be going.
I’m just wondering. How is the minister’s new performance measure, which is the number of grants awarded, directly tied to the doubling of the B.C. Arts Council budget, as her service plan claims?
Hon. L. Popham: The additional funding will directly benefit artists and cultural organizations. I can tell the member exactly what that will be focused on: addressing gaps in current programs for Indigenous, equity-seeking and rural regional artists, arts organizations and communities; emphasizing sustainability and artistic capacity by building a stronger foundation for arts organizations and artists through existing programs and new opportunities; and finally, allowing for increased experimentation, access and innovation with the launch of new programs and strategies.
The short answer, then, is yes. The increase in the number of grants is reflected in the increase in the budget.
D. Clovechok: I’m wondering…. One of the growing areas in tourism, back to tourism…. One of the most exciting, in my mind — it’s near and dear to my heart — growing sectors is Indigenous tourism, throughout Canada. Obviously, B.C. is well positioned in that market. I’m wondering if you could explain and update us as to what kinds of investments are being made into Indigenous tourism right now.
Hon. L. Popham: The province provides about $1 million per year in funding through Destination British Columbia to the Indigenous Tourism Association of B.C. to create new products, improve those that already exist and present them to world markets.
D. Clovechok: Are there any plans going forward to increase that funding at all?
Hon. L. Popham: I’m really happy to know that the member’s excited about these initiatives, because I am as well. I think it’s an exciting time. Some of the excitement can be reflected in a new investment that we’ve just made as government, which is very, very significant — the $50 million over three years for the First Peoples Cultural Council to support retention and revitalization of Indigenous languages and culture in B.C. This is a significant investment. I think that it’s one of the most exciting commitments that we’ve made.
The province of B.C. is the lead in Canada on Indigenous tourism, so Indigenous tourism is a key part of the provincial tourism strategy. We are going to be working to make sure that we look at ways of doing outreach. The budget itself is what is stated in the budget documents, but we are looking at ways to make sure that our outreach is extensive.
M. Stilwell: I apologize for flipping back to another topic, but it’s the end of the day, and sometimes your lightbulb goes on and you think you want to ask something while we still have the chance, noting the time.
Yesterday we talked about the sport policy renewal. The minister informed me that consultations were going on with a variety of organizations and that documentation was being provided from those meetings, coming back to the ministry, being sent back to the groups for feedback and then coming back into the ministry for approval. Could the minister inform me if the parliamentary secretary was present for any of those consultations?
Hon. L. Popham: The parliamentary secretary has been meeting with key stakeholder groups on his own. The minister met with the leadership groups for consultation. The parliamentary secretary was not in that meeting but will be included in meetings in the future. The parliamentary secretary is conducting stakeholder meetings as well.
M. Stilwell: Then, just to confirm, the meetings that took place, which the minister listed, that were group meetings…. The parliamentary secretary didn’t participate in that as a listening opportunity and to hear directly from the organizations that will be impacted by the sport policy renewal.
Hon. L. Popham: In the initial meeting, the parliamentary secretary was unable to attend, but the minister did attend.
M. Stilwell: Could the minister refresh my memory, since it was yesterday morning when we first started, on what the timeline was for the implementation of the new performance measures?
Hon. L. Popham: The timeline, as I understand it now, is that in the summer there will be a draft that is worked on, and the parliamentary secretary will be involved in that. In the fall, there will be a consultation workshop, and then the actual strategy will be released in the fall as well.
M. Stilwell: Could the minister confirm for me that the parliamentary secretary will be at the consultation workshop?
Hon. L. Popham: We anticipate him being at that meeting. He is very passionate about this issue, so I would expect to see him there.
M. Stilwell: Would there be a possibility for me, as the sport critic, to attend the workshop to add value to the discussion?
Hon. L. Popham: We absolutely recognize the contributions that the member could make to the consultation, so the invitation is absolutely open.
M. Stilwell: Well, thank you. On such a positive note, I’m going to bring closure to these estimates for you.
I thank all your staff for being so patient. I thank all your staff for being very supportive of you, and for you for stepping up and taking on the role of acting minister in the absence of the minister. Wishing her well, again, in her healing and hope that she’ll be back sooner rather than later, mostly because the numbers are tight for you guys.
Kudos to the staff. We know how much work goes into preparing for estimates, and we truly appreciate the dialogue that has gone on and the answers we have received.
D. Clovechok: I just want to say thanks to the staff and all the amigos behind you there and all the ones that are out and have come and gone already. It’s been very productive. I appreciate the quickness of your answers. That’s something I never experienced in November, so I really appreciated that. I think we got through with some respectful dialogue.
I want to thank the minister for filling in as an acting minister. You did an outstanding job. When the Premier asks me how well you did, I’ll tell him. But in any event, thank you so very much. I look forward to that coffee.
Hon. L. Popham: I would also like to thank the members from across the way, the critics that attended estimates today.
I have always believed, mostly because I was a critic for so long, that critics have an extremely important job to do at holding government to account. I appreciate the lines of questioning. Some of it is very difficult, but I’ve learned a lot myself as acting minister.
I want to thank my staff for being here and supporting me the way they did. I know this was beyond, probably, their expectations when they were thinking about estimates coming up this year. But my colleague the minister will be returning soon.
It was a great honour to represent this ministry. I believe in this ministry. I was lucky enough to be the critic of this ministry for about a year. But this experience has definitely been wonderful for me too. So thank you to the patience of the critics, to the patience of my staff and to the patience of all of the Chairs who came through.
On Vote 41: ministry operations, $140,681,000 — approved.
Hon. L. Popham: I move that the committee rise and report completion of the resolution and ask leave to sit again.
Motion approved.
The committee rose at 4:49 p.m.
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