2010 Legislative Session: Second Session, 39th Parliament

SELECT STANDING COMMITTEE ON PUBLIC ACCOUNTS

MINUTES AND HANSARD

MINUTES SELECT STANDING COMMITTEE ON PUBLIC ACCOUNTS

Tuesday, December 7, 2010

10 a.m.

Douglas Fir Committee Room

Parliament Buildings, Victoria, B.C.

Present: Bruce Ralston, MLA (Chair); Douglas Horne, MLA (Deputy Chair), Kathy Corrigan, MLA; Guy Gentner, MLA; Spencer Chandra Herbert, MLA; Rob Howard, MLA; Vicki Huntington, MLA: Richard T. Lee, MLA; John Les, MLA; Norm Letnick, MLA; Joan McIntyre, MLA; Lana Popham, MLA; John Rustad, MLA; Ralph Sultan, MLA

Unavoidably Absent: Shane Simpson, MLA

Others Present: John Doyle, Auditor General; Stuart Newton, Acting Comptroller General;
Josie Schofield, Manager, Committee Research Services

1. The Chair called the Committee to order at 10:01 a.m.

2. Report No. 5, 2008/09 Removing Private Land from Tree Farm Licences 6, 19 & 25: Protecting the Public Interest?

3. The Committee recessed from 11:44 a.m. to 12:16 p.m.

4. Report No. 5, 2010/11 Audit of the Agricultural Land Commission

5. The Committee recessed from 1:32 p.m. to 1:38 p.m.

6. Report No. 3, 2010/11 Conservation of Ecological Integrity in B.C. Parks and Protected Areas

7. The Committee adjourned at 2:52 p.m. to the call of the Chair.

The following electronic version is for informational purposes only.

The printed version remains the official version.

REPORT OF PROCEEDINGS
(Hansard)

select standing committee on
Public Accounts

Tuesday, December 7, 2010

Issue No. 13

ISSN 1499-4259

[ Page 343 ]

TUESDAY, DECEMBER 7, 2010

The committee met at 10:01 a.m.

[B. Ralston in the chair.]

B. Ralston (Chair): Good morning, Members. Welcome to another meeting of the Select Standing Committee on Public Accounts. We have an agenda today where we're going to consider three reports prepared by the Office of the Auditor General. The first…. I'm assuming that the agenda is passed by consent unless there's any dissent that I hear.

No. Okay. That's relatively uncontroversial thus far. You never know these days.

Interjection.

B. Ralston (Chair): Exactly — incremental steps only.

So the first report is Removing Private Land from Tree Farm Licences 6, 19 & 25: Protecting the Public Interest? I'm going to now turn it over to Mr. Doyle, the Auditor General, and Morris Sydor, the assistant Auditor General, to make a presentation. Then we will turn to Jim Langridge, who's the director of the resource tenures branch, Ministry of Forests, and Tom Jensen, the Assistant Deputy Minister of Forests, for the response of the government. Then we'll entertain questions from members.

Auditor General Report:
Removing Private Land from
Tree Farm Licences 6, 19 & 25:
Protecting the Public Interest?

J. Doyle: Chair, good morning, and good morning, Members.

Report No. 5, 2008/09, is Removing Private Land from Tree Farm Licences 6, 19 & 25: Protecting the Public Interest? This 2008 report was regarding a 2007 decision made by the then Ministry of Forests and Range. The decision involved the removal of private land from three tree farm licences on Vancouver Island.

I decided to conduct this work after receiving many requests from individuals and different organizations. The results of my review were widely publicized, and since the report has been published, the implications of this decision for stakeholders continue to play out in the public forum, illustrating the importance of a robust process and adequate consultation for significant land use decisions.

The ministry stated during my follow-up on this work that it had adopted a more robust process for subsequent private land removal. As a result of the report findings, I released a document on principles and best practice of public participation, which was distributed to all ministries by central government and is also being considered by this committee.

With me today is Morris Sydor, the assistant Auditor General responsible for performance audits, with a focus on audits in the area of sustainability and the environment. I'll turn it over now to Morris to go through the slideshow.

M. Sydor: Good morning, Chair and committee members. As John indicated, our office received a number of requests in 2007 to look at this decision. After considering the issues, the Auditor General decided that the review would be in the public interest. The purpose of our review was to assess whether due regard for the public interest was exercised when approving removal of private land from TFLs 6, 19 and 25.

We had three questions in our review. First, we assessed whether the decision was adequately informed; second, we looked at whether there was effective consultation and communication with stakeholders; and third, we looked at whether the ministry effectively monitors its land use decisions.

[1005]

We concluded that the removal of the private land from the TFLs was approved without sufficient regard for the public interest. Specifically, we noted that the information provided by the ministry to support its recommendations to allow the land removal was incomplete. The recommendation was not clearly supported by the ministry's own analysis, and there was no explanation of how the removal on the terms proposed was in the interests of British Columbia.

The consultation process focused on First Nations and the Ministry of Environment but lacked input from some key stakeholders, and the ministry did not adequately communicate the decision to the public. As well, the ministry was not adequately monitoring its previous land use removal decisions to better inform future requests to assess stakeholder capability to deal with decisions or to ensure that conditions agreed to by licensees were being adhered to.

On the first question, we found that the process for evaluating the land removal request was not well defined. In particular, there was a lack of clarity about the purpose of the review and about the key principles to apply from past decisions. The information collected by the ministry was incomplete. While it included information about potential forest management issues and a number of other points, it didn't include an analysis of the licensee's financial health or government's position on seeking compensation from the licensee.

As well, the ministry's briefing material did not make a persuasive business case for allowing the removal.
[ Page 344 ]
Several undesirable impacts were identified, but they were not fully investigated by the ministry or a means to mitigate them identified. The ministry's recommendation to allow the land removal did not clearly follow from its own analysis. The minister is the statutory decision-maker and a final check on the process. We concluded that the minister did not do enough to ensure that the decision to remove the land was in the public interest.

With regard to stakeholder consultations, we found that the ministry did not consult effectively with all key stakeholders. The ministry did consult with First Nations and also consulted with the Ministry of Environment. The briefing material summarized issues raised by each First Nations group. Also, the Ministry of Environment's input resulted in securing a road into Cape Scott Provincial Park. However, the ministry did not identify or consult with groups such as the capital regional district, the communities in the affected areas or the general public.

As a result, the ministry briefing materials lacked important information that could have helped ensure that there was due regard for the public interest. The ministry's public communication lacked important information to help stakeholders understand the rationale for the decision or how the public interest issues were addressed. It was also missing key information — for example, the licensee's intent to sell some or all of the land and that some had a higher and better use.

We also noted that the ministry was not monitoring past land removal decisions effectively. It had not documented important elements of past land removal decisions, such as compensation and key considerations in arriving at decisions. The ministry was also not formally monitoring the impacts of its past land removal decisions and believes that it is not its responsibility to do so.

Once removed from the TFL, forest land falls under the Private Managed Forest Land Act, which is the responsibility of the Ministry of Agriculture. The ministry did not take into account stakeholder capacity to deal with the impacts of the decision — for example, the ability of First Nations to fully understand and investigate the impacts of the decision. As well, we noted that the CRD had to take unplanned action, such as emergency meetings and new bylaws, to respond to the licensee's move to sell some of the lands for development.

Also, the ministry did not have processes or authority needed to ensure that all the agreement conditions were met. Apart from log exports, the conditions that the company agreed to only applied while the company owned the land. The ministry was aware that the company was planning to sell the land, so that the conditions were not in any way permanent or enforceable.

Subsequent to our report, in October 2008 the government announced that the minister had approved the removal of about 4,300 hectares of private land from TFL 23 in the Kootenays. A government news release indicated that the minister had negotiated about $6 million in benefits for local communities.

Media reports identified three ways by which the minister enhanced the decision-making approach. First, there were consultations with local governments, and public hearings were held. Second, adequate information was sought and obtained. Third, as already mentioned, a benefit to the community was obtained.

[1010]

Now, at the time that we issued our report there was little private land remaining in TFLs, so we made no recommendations. We did, however, believe that all government ministries and agencies could learn from our findings and conclusions.

For our office, the review highlighted the need to better understand the government's approach to public consultation. So we initiated an examination of the consultation process, and the results of that were reported in November 2008.

That concludes my presentation, Chair.

B. Ralston (Chair): Thank you.

I'm not sure who's going to go first — Mr. Langridge or Mr. Jensen.

T. Jensen: I understand that all of the members have a copy of our presentation, so we're not going to be putting the PowerPoint up.

I just want to go through the presentation. First, I'm going to make a comment on the actual audit process and then comment on the definition of "public interest" that was used by the Auditor General, respond to the conclusions that the Auditor General made — you've seen that in their presentation as well — and then reiterate some concerns we have around unsupported statements or that we feel are outside the scope of the review.

From the ministry's perspective initially, we embraced the audit as an opportunity to learn and evolve. As you see from the Auditor's presentation, we have incorporated some of the learnings of that in our approach to the removal of private land from TFL 23.

The concern that we do have around the process was that, initially, it was identified that the ministry would be allowed to provide a response that would be included in the Auditor's report as a public document. That did not happen. The ministry's response is a separate document and is not included as part of the Auditor General's report.

In terms of the definition of "public interest," the concern that we have is that under the forest and range act, one of the key goals that the ministry has is that public interest actually includes a competitive forest industry. An investment in job creation in industry is important to support revenue to government for things like health care, public education and so on.
[ Page 345 ]

We feel that had the Auditor General considered and factored in the issue of the ministry's role in trying to ensure a competitive forest industry, perhaps different conclusions would be made around the overall conclusion that the removal of land was approved without sufficient regard for public interest.

As the Auditor General has noted, as a result of the audit, the ministry has adjusted its approach based on their conclusions. We've demonstrated that in the process to approve removal of private land from TFL 23 and the Arrow Lakes area as a subsequent event.

What I want to do is I want to just go through the specific responses to the Auditor's conclusions around consultation, documentation, communication — what we refer to as transitional issues — and then, finally, the unsupported statements.

In terms of consultation, as the Auditor has pointed out and we've demonstrated in the removal of private land from TFL 23, there was a comprehensive consultation with local government, Crown agencies, the local public and First Nations. It included public meetings as well.

One of the differences that I want to point out here in terms of the approach to TFL 23 — I think it is relevant to the approach that the ministry takes — is that with respect to this removal, the company was in bankruptcy. It's a Pope and Talbot bankruptcy. Removal of the land was part of a transfer of the licence to another company that was purchasing. So there is a different set of circumstances in terms of how one might approach consultation.

In terms of documentation, again, the Auditor General concluded that there wasn't sufficient documentation to support the decision. That's based on the written briefing materials that were provided to the ministry.

[1015]

I just wanted to point out that briefings of ministers are not simply all written material. There are lots of verbal briefings, and we submit that there were other significant discussions that informed that decision that were not documented in the form of the briefing note.

In terms of communication. As I said, with respect to TFL 23, we have evolved our process. There were public meetings in Revelstoke, Nakusp, Castlegar. The implications of the minister's decision were communicated prior to the decision. There was a dedicated webpage that was set up on the ministry website, the news release and a copy of the minister's decision letter and other supporting documents. So we did improve our process around communication and transparency thereof.

In terms of transitional issues. This refers to the OAG's conclusion that there was a lack of consultation and communication with local government. In terms of the TFL 23 removal, we held meetings with local government prior to the decision so they could prepare for that decision. Again, I would argue that it's easier to do that in the case of a company that's in bankruptcy, as opposed to a company that is publicly traded.

Regarding unsupported statements. What we're referring to here is that there is a reference to…. There's a sidebar on page 30 of the Auditor General's report, and it refers to unusual stock-trading patterns and that there's a concern that perhaps, in this process, there was insider trading, if you will. It's sort of plunked in as a sidebar reference. There's a reference that given there's a concern, that issue is referred to B.C. Securities Commission.

The concern we have about that is that there's nothing to substantiate it. It doesn't seem to be within the scope of the Auditor General's own review in terms of what the public interest is. The concern we have is that it implies or brings into question the conduct of public servants with regard to this decision.

I want to register concern we have that the report…. Again, there is no response from the ministry in that report. It tends to lead the reader that there are, perhaps, public servants who are benefiting or could benefit from this. That's a concern we have. We feel it's not necessary in terms of the scope of the review, and it tends to put public servants in a bad light.

We have a code of conduct that we operate under as public servants — conflict-of-interest guidelines, an oath of service, and so on. So I just wanted to register here that that is a concern of the ministry, and it continues to be so.

There's also another reference to political donations by Western Forest Products to the Liberal Party. It doesn't really link to the study. It's thrown out there. Again, concern around what that means in terms of the implications for a decision-maker.

Having said that, in terms of the conclusions…. Our conclusion is that from our perspective, the Auditor General report did provide useful insights into the need for a more inclusive process leading to decisions related to public interest. Again, the caveat is that it was easier to do around a company that was in bankruptcy, as opposed to one that's being publicly traded, and the difference in terms of the kinds of information that you're putting out to the public.

We would argue that the ministry has evolved — again, it's supported by the Auditor General — and improved processes for consultation, communication and documentation of similar decisions. The ministry will continue to assess the need for further improvement as time evolves, with the understanding, as the Auditor has pointed out, that there is not of lot of private land left for removal.

B. Ralston (Chair): Thank you.

Let me put together a list of questioners, then. I've got Kathy. Anyone else? Spencer.

K. Corrigan: I have a few questions. They can be answered by either of the presenters.
[ Page 346 ]

My first question is…. The $150 million, which has been referred to as the value of the tree farm licence. It was in briefing notes, but what I wasn't clear…. I may have missed it in the report.

[1020]

In the concern expressed about consultation with stakeholders and so on, was that number, that estimated value of $150 million, made public at the time, and was that included in the consultation information that was provided at what consultation took place?

J. Langridge: My name is Jim Langridge. I'm with the Ministry of Forests, Mines and Lands. The short answer: no. The $150 million represents the 28,000 hectares at an average value of approximately $6,000 per hectare, and that number emerged as the gross value of the land that Western held at that point in time.

K. Corrigan: My second question is for the Auditor General. This report was produced a couple of years ago, and I'm wondering if there is any update that the Auditor General could report on with regard to the sidebar about unusual stock-trading patterns.

J. Doyle: Thank you for the question. The reason we raised the unusual trading was because there was unusual trading, and it featured in a number of letters that were sent to us. We were not equipped to examine that unusual trading. It was our understanding that knowledge of the transfer of the land or the excising of the land was known to only relatively few people within the ministry, but it may have been known to others outside. I'm not sure. The minister's decision was one that was kept close.

But the unusual trading still occurred. So what we did was we brought it to the attention of the Securities Commission and asked them whether there was an issue here. Those are all facts. There is no innuendo in any of that. They're facts.

What they didn't tell us when we published the report was that they'd actually concluded that they weren't going to continue with that investigation at that point in time. The ministry rang up and asked the question and were told that, but apparently the Securities Commission forgot to tell us.

We don't know why they didn't proceed with that investigation, but you'd be aware that such investigations are notoriously difficult to pin down any issues anyway.

The simple issue was that we noticed unusual trading. It had been brought to our attention by a number of the correspondences that we received. We referred it to a body that was capable of dealing with it, and we closed down on that by actually referring to that in the body of our report.

You won't find us using the term "insider trading" in there at all. You find "unusual trading patterns" is the phrase that we use. It was all closed down fairly quickly after that when the Securities Commission decided not to go any further.

S. Chandra Herbert: Just curious. Mr. Jensen was saying that one of the ministry's goals is economic development as well. So the public interest piece of this would be about supporting jobs so that we could then fund health care.

The report outlines a number of costs to government: things like the forestry research sites losing $2 million, I think was one of the noted dollars amount for that; a decline in ungulate and deer populations; tourism and recreation sites potentially lost, with a cost factor there; potential for degraded water quality; potential for legal action from First Nations concerned about consultation issues; and, of course, the $150 million land value going up.

My question is: has there been work done looking back on what all of those costs are adding up to? For example, I believe the Jordan River site was recently purchased, in part through funds municipally but also provincially. I'm just wondering: what was the cost on that side, and what were the other costs? If we're wanting to fund health care and things like that, those costs, I think, need to figure as well.

[1025]

J. Langridge: The Auditor General identified a number of what I'll characterize as what-if's — things that may happen in the future. The research sites are still there. The recreation sites are still there. There have been no watershed issues that I'm aware of. Much as what the Auditor General's report indicated are our true potentials, so far none of those have materialized.

The $150 million I have to clarify. That is the value of pre-existing private lands. That is not a cost to government. The $150 million is simply the value of the private lands that were Crown-granted over a century ago. So again, they are not a cost to government. Yes, there may be some downsides. When we did our consultation with our colleagues in research branch around the research sites, we got from Western a commitment that, in the event that anything happens that would result in those research sites being impacted, research branch would get ample warning to do a final round of measurements and whatnot.

The consultation in that regard was aimed at mitigation. As it turns out, those research sites were in second-growth stands, and there are other second-growth stands that we can transfer that to.

S. Chandra Herbert: Just the one question that I still had was the cost of the purchase of those Jordan River lands, which obviously a lot of folks here in the CRD were concerned about. Do you know what that final cost figure was?
[ Page 347 ]

J. Langridge: Short answer: I do not have a hard number on that. Sorry.

S. Chandra Herbert: Okay. I see the Auditor General.

J. Doyle: We're talking about pages 37, 38 and the top of 39, I think. I just wanted to point out that they weren't what-if scenarios. What they were, were issues that were identified by the ministry that weren't analyzed properly in the documentation.

So what we did was that we made it clear that these were the issues that should have been considered according to the ministry's documentation, and they were not a list of things that we made observation on otherwise, other than that they were part of the menu for discussion.

B. Ralston (Chair): Mr. Jensen, you made reference to your preferred definition of "public interest," which under the act you said would refer to job creation and the maintenance of a competitive forest industry, yet in the report the Auditor General points out that "the recommendation put greater weight on assisting the licensee's financial restructuring than on other public interests, including the potential negative impacts on forest and range and other stakeholders" — this is the bottom of page 9 — "but the information contained no analysis to support this position."

Page 40 in the longer version: "We concluded that the ministry's process and recommendation was based on a belief that the removal of private land was consistent with government's direction and would also assist the licensee in its financial restructuring. Unfortunately, there was no ministry analysis of when or by how much such a restructuring would benefit British Columbians."

What I see the report saying is that notwithstanding this definition that you speak of, the analysis was not done to support that conclusion that was set out in the act. So what's your response to that? It seems to me that despite your insistence that there's a definition in the act, the work wasn't done to support that.

T. Jensen: Chair, at that time I recall that Western Forest Products was just coming out of creditor protection. It's the largest single player, in terms of forest companies, on the coast. It now employs around 3,000 people directly, plus economic impact, in terms of contractors. So Western Forest Products is a significant player and had potentially a significant impact on the coastal forest industry itself. All of that was known to the ministry.

[1030]

B. Ralston (Chair): With respect, that really doesn't answer the question. What is being asserted here by the Auditor General — fairly vigorously, obviously — is that the analysis was not done to support what you say is an important aspect of the definition of "public interest."

Beyond just saying that it's big and it employs a lot of people, surely the ministry has some obligation in a decision of this sort — I think is the argument — to decide exactly what the implications are rather than "let's throw them a bone in the form of $150 million of private land that was formerly in the TFL" and knowing that taking it out will increase its value dramatically and give a windfall profit to the company that may assist its restructuring. Is that the decision-making process that was undertaken here?

J. Langridge: If I may, one of the practices, if you must, of the ministry is that when we provide briefing material to the minister, it takes into account that which the minister already knows. If we were to try and document all facets of every decision as if it was a public record, the poor man would just seldom get much done because he's had so much volume of information to wade through.

Taking into account that which the minister already knows and we know he knows by virtue of having participated in meetings, briefings, etc., with him, we give him the additional information necessary to make an informed decision. And much as there may be some discussion as to the adequacy of that additional information, the point I'd like to make is that we give the minister the incremental information based on the knowledge that he already has.

The state of the coastal industry was well known. The state of Western was well known to the minister by virtue of briefings that he had with Reynold Hert and others from Western Forest Products. That was the principle that we took into the briefing material and documentation.

J. Doyle: Just two observations, Chair. The first was that the definition of "public interest" used for our work was agreed to in advance with the ministry. The second is that we did ask what was used to inform the decision. We were told it was the briefing document that was provided, which as you so rightly point out had no analysis of the financial position of the company, and then verbal briefings that were conducted previously. That's the response we got back from the minister's office.

We have been unable to find any document anywhere which provides an analysis on the financial health of the company and the contribution that this decision may or may not have in regard to that, nor were we able to find any documentation in regard to forecasts of jobs that may be generated.

Whilst we accept that this is a big player in the forest industry, what we're referring to here is the analysis that
[ Page 348 ]
was conducted to inform a decision, and quite frankly, we couldn't find any information.

Now, bear in mind that my personal knowledge of forestry issues is relatively limited, but my knowledge of financial issues is in fact very good. I couldn't find anything that would provide me with adequate information about the financial health of this particular organization, and I did ask on several occasions.

B. Ralston (Chair): So for example, there was no written agreement or minutes of a meeting that would say that if this decision were made by the minister, Western Forest Products would commit to maintaining a certain number of jobs, a certain level of activity depending upon market conditions and making some commitments about how that potential dramatic increase in the land value of the private land, were it to be removed from the TFL, would be used in restructuring and making Western Forest Products more competitive in the forest industry as opposed to a big player in the real estate industry.

J. Doyle: We were given nothing of that nature.

[1035]

B. Ralston (Chair): A further question. You attempted to speak directly with the minister in his role as a statutory decision-maker. I gather that opportunity was not chosen by the minister and that he chose to respond in writing to various questions.

Can you explain what authority, if any, there is for the Auditor General to seek a personal, direct meeting with the minister in circumstances such as this and your view of the value of that, were that to have taken place?

J. Doyle: The circumstances were that we attempted, on a number of occasions, to actually meet with the minister. It was a time, we were told, when things were very busy, and the minister was not available.

But there was fulsome cooperation from the minister's office, and they filled out responses to all the questions that we had and sent them back to us. There was an element of back-and-forth while we got clarification on some of those questions, so we felt that even though we didn't have a face-to-face, we still got the information that we requested.

There's nothing in my legislation which says that I can't ask for…. In fact, the legislation is quite explicit. I can ask for any information from any public servant or member of the government in regard to an enactment of a duty. In this particular case, I was well within my mandate to actually conduct this work.

The issue was not about the minister's right to make any decision that he wanted to make. They have that right, and I wouldn't challenge it or even make comment on it.

What we were looking at was the process that was followed. The process is about the consultation, the information that's provided to support a decision and the way that the ministry was able to provide an analysis that would support any decision that was made.

The right for the minister to make the decision is enshrined in legislation. You will find not one word in this report which refers to that. It only refers to the process that was followed in making that decision, and we got fulsome cooperation from all parties in regard to that.

S. Chandra Herbert: I guess I'm curious about…. There was the statement that a lot of this information — and the details that the Auditor General said — wasn't in the report to the minister, which would normally be required to understand if a decision of this magnitude was in the public interest. The suggestion was that there had been lots of verbal briefings. It was not documented in the form of a briefing note.

I'm just curious. For something as big as this, something that cost the capital regional district $19 million in terms of the Jordan River lands and Sandcut Beach alone…. How would we get to a position where the information which is required to make a decision in public interest would not be featured on any written documents? I know people have room in their brains, but something as big as this, you'd think, might feature on at least one piece of paper, when it's multi-millions of dollars in impact on both regional taxpayers and also provincially.

T. Jensen: The reference to information that was not part of the briefing note that was part of discussions with the minister, as I understand, has to do with the state of the industry, which is well known.

Again, the coastal industry was — and it continues to be — in great difficulty in terms of profitability, job creation, investment and so on. It's that part of the discussion that…. Although it wasn't in the actual briefing note, that's the kind of discussion and knowledge that the minister already had, which was not part of the written analysis. That's the point I was making.

[1040]

S. Chandra Herbert: Okay. What I just….

B. Ralston (Chair): Mr. Doyle, did you want to add to that?

J. Doyle: We thought that that might be the case, so we asked on many occasions for the background briefings that may have been made available regarding the financial health of this particular entity. We were not given any such documentation.

I mentioned earlier that I was probably quite knowledgable about financial analysis. I can assure you that
[ Page 349 ]
if I were to look at any public company and to consider its financial health and the impact of any decisions upon it, I would have some documentation in regard to it. I could not hold it all in my head.

It would seem to me a basic tenet of good recordkeeping and management that such advice, if it was coming from the ministry, would be available.

Now, we don't believe that any documents were hidden from us. We do not believe that. Therefore, we can only conclude that such documents did not exist, and I don't know how you can make that analysis without documentation and analysis.

S. Chandra Herbert: I just find it astounding that for something like this, when we're talking about the public good, the ministry is relying on the definition of just the economics. Yet there's no paperwork, nothing, to back that up.

If we're talking about protecting jobs or increasing jobs, you would think there would be a basic analysis, at the very least, which shows a certain range of jobs that could be created or jobs that could be saved. You'd think there would be some sort of analysis of an agreement with the tree farm licence holder about what they would be required to do.

The taxpayers here in the capital regional district have ended up having to pick up the tab to save some beautiful places, which are actually very important for tourism in the region. They don't have the luxury of verbal briefings. The taxes are coming out of their wallets to pay for this, and there's been no clear commitment from the licence holder to actually produce jobs.

What would hold the company back from taking the money that it makes off this purchase — or any of these companies — and investing in a different part of the world? Nothing. They could do very well that way, and that would be their choice.

It's just astounding to me that this decision was made in this way. I still am amazed that the ministry has taken this approach. Clearly, something was done here that, in my view, is very wrong. I don't think it's in the public interest. I think it fails many of the tests that any credible person would want to see in terms of government decision-making.

I had expected that the ministry would come here today with a little bit more of a tail between the legs, saying: "Sorry, we made a mistake here. This is clearly not what we need to do." But from what I've seen, the ministry is taking a defiant stand, suggesting that this is clearly appropriate, that everything was done well and: "Oh well, maybe we could have talked to a few more people."

This is a lot of money, and this is a lot of land. This has a huge effect in so many ways. I can't understand how the ministry feels that this is appropriate.

There was not a persuasive case made. If there was, it would have been…. They could have gone public with the case of why this was necessary — how many jobs, what it would do — and take it that way. They didn't do that because they couldn't. They hadn't done the work.

I'll have future questions as I let my other colleagues speak on this. I'm just really surprised.

B. Ralston (Chair): That's not really…. It's more a statement than a question. Mr. Jensen, did you want to respond?

T. Jensen: Yes, Chair. Just to clarify, the ministry isn't here saying that the only factor in defining the public interest for the ministry has to do with supporting a competitive forest industry. As the report shows, the ministry took into consideration the impact on watersheds, old-growth management areas, wildlife habitat, First Nations access and so on.

I just wanted to be clear to the member that it is not our position that that is the only element of public interest.

S. Chandra Herbert: I understand that. I just….

T. Jensen: And secondly…. Sorry.

B. Ralston (Chair): Perhaps just let Mr. Jensen finish. Go ahead.

T. Jensen: Secondly, I think we've been very clear in the presentation that we've provided to members that rather than being defiant in our response, we've actually acknowledged that we've responded to the conclusions of the Auditor General and have adjusted the approach that we have taken, based on the learnings from the report and the discussions we had with the Auditor General, to the removal of private land from TFL 23.

I just wanted that to be a matter of record, Chair.

[1045]

B. Ralston (Chair): I think that's entirely appropriate.

Did you have a further question?

S. Chandra Herbert: Yeah, it was just to the Auditor General — just to understand if the Auditor General felt that the response from the ministry was appropriate and dealt with all the concerns. It doesn't sound like that to me, based on what I've heard, but is the information being provided appropriately now and into the future? Because it wasn't in this case, in my belief.

J. Doyle: There are now very few private lands left in TFLs, and that's why we didn't make any recommendations. But some months after we published this report there was another TFL decision that was made by the minister — a different minister, but the minister. If I
[ Page 350 ]
recall correctly, his public pronouncement went something along the lines of "We heard the Auditor General loud and clear, and we did it differently," and that seems to have flowed through.

Now, we have not gone back to check to see whether there's any monitoring of previous decisions. We've not gone back and checked in this level of detail the information that's provided for subsequent decisions, but my guess would be, given the professionalism that does exist within the ministry — there's a lot of professionalism there — that these matters have been corrected and that there is a much more enhanced process that is followed in regard to provision of information to support decision-making. But I have not yet tested that. I'm assuming that's right because of the nature and the quality of the people that are involved.

V. Huntington: Firstly, I'd just to comment that…. Time has passed here, but early on the ministry's response to the report was that it was inappropriate. I'm not sure whether it was the minister or the ministry that said it lacked integrity, but I just wanted to say that I think it is an incredibly appropriate report. I think it underscores a real problem within the ministry — which, I hope, as the Auditor General says, has been looked at and responded to — because the disposal of land in this manner is a serious issue, I think, to the public at large. I hope that these systems have been put in place and that the monitoring checks are there — that this would not happen again.

You mentioned in one of your comments — I think Mr. Langridge — that the minister received briefings from Western Forest Products on the company's financial position. Given that there was no documentation within the ministry to make these decisions about the disposal of the land, was any ministry official present during these briefings to the minister from WFP? Were notes taken, and was there any documentation as a result of that?

J. Langridge: I can't answer whether or not notes were taken. Our deputy minister of the day often was at these briefings. I know I've participated in briefings with Western Forest Products and our deputy where the information that I understood had been verbally passed on to the minister was passed on to us as bureaucrats. And so the working assumption is that the minister had the same fulsome briefing as to the state of Western's financial situation and how integral the decision would be and the types of things they would do if their balance sheet looked better — and as it turns out, proven up in that they did invest in several of their facilities as they said they would. But in terms of documentation that supports that, I don't have it. Sorry.

[1050]

V. Huntington: Did the decision to dispose of the land flow out of that meeting with the minister, and is that where you received the marching orders to start the process?

J. Langridge: No, the decision to proceed with the evaluation and the impact analysis of the private land withdrawal came as a result of a formal letter that came to the minister requesting it.

V. Huntington: But you don't know whether that letter was requested as a part of the meeting in order to initiate…?

J. Langridge: I do not.

V. Huntington: And the impact analysis — you say that it covered much of what the Auditor General is suggesting wasn't available?

J. Langridge: The evaluation that we did at the time was focused largely on mitigation of forest management implications associated with the withdrawal of the private land, and the briefing note that we presented to the minister addressed those items.

V. Huntington: Those items. Could I just say: did you have access to that briefing note to the minister?

J. Doyle: I'm just checking here.

J. Langridge: I can answer the question for you. Yes, he had access to that briefing note.

V. Huntington: And you say that that briefing note….

B. Ralston (Chair): Perhaps we can just wait for Mr. Doyle to confirm that. He is conferring with Mr. Sydor.

J. Doyle: We will find out whether we had that document, and we'll find it out straightaway and come back in maybe a few minutes and give a response.

V. Huntington: I'll leave the questions on that, then.

One of the interests I have flows out of how you measure public interest in the other capacities, and you say that you looked at other issues such as — I'll take the environmental ones — the community watershed, the wildlife habitat, the old-growth management areas.

B. Ralston (Chair): Perhaps maybe just pause for a moment. I think Mr. Doyle and Mr. Sydor are on the verge of an answer here.

J. Doyle: Just a matter of clarification. I think the ministry officials are referring to the final briefing note…
[ Page 351 ]

J. Langridge: That's correct.

J. Doyle: …not documentation that comes from the company.

We found precious little, if any, documentation that actually came from the company or analysis conducted by the ministry in regard to the financial health or otherwise of the entity concerned.

It was almost a given, as far as we could tell, that the company was in financial difficulties and that this would make a significant contribution to those difficulties. But it was not explained anywhere how that would work or how that would flow through or whether it would be enough or what the problem actually was with Western Forest Products.

B. Ralston (Chair): Mr. Sydor wanted to make an additional comment.

M. Sydor: Yes, I'd like to comment. As the ministry staff indicated, there may have been information coming from Western Forest Products. What we were looking for was an analysis from the ministry to validate the information that was coming forward.

In our report, in appendix D on page 68, we make note of a letter that Western Forest Products sent on April 28, 2006. It talks about purchasing Cascadia, and it makes a reference, in fact, to the deletion of private lands and notes that it intends to offer those lands for sale.

So you know, we're looking at a situation like this. The company came out of creditorship in 2004. That's our understanding. Two years later it's in a position to purchase Cascadia. Later that year it received over a hundred million dollars as a result of the softwood duty refund. So we were looking for an analysis of what the implications are.

We've got a company purchasing Cascadia. We've got a hundred million dollars coming back. What does their profit position look like? Does it look like it's going to be profitable? Does it impact the decision that the minister is going to make? That was the sort of analysis we were expecting to see because of the changing financial nature going on at the time that the decision was being contemplated, and we didn't see anything along those lines.

As has been indicated, there isn't any information other than what verbal briefings may have been provided.

[1055]

B. Ralston (Chair): So just if I can confirm that, then. The financial position of the company, in your view, based on your knowledge of external factors, may well have changed dramatically from its position in 2004. Yet this decision followed, to all intents and purposes, as though it was still in the same financial position as it might have been in 2004. Is that…?

M. Sydor: Well, it changed quite a bit from 2004. We got a lot more investment in it. As I indicated, they had the capacity to, you know, purchase Cascadia. They've got $100 million in the softwood duty refund. So it was a case of looking at what those financial implications are and doing an analysis. How does that fact…? The decision may still have been made the same, but there wasn't any analysis done to indicate what is happening with this company.

B. Ralston (Chair): Thank you, then.

Are you finished, Vicki?

V. Huntington: No. I would like to find out where the direction came to solve Western Forest Products' problems.

Without documentation to prove that they had them, I'd like to know where the direction came from to dispose of land in order to assist them, but I don't know whether you have that. Did it flow out of the meeting with the minister? Was there direction given to the ministry to start discussions in order to find out how you could help them out of their problems?

B. Ralston (Chair): Your question is directed to ministry officials, then?

V. Huntington: Yes, it is.

J. Langridge: Yeah. We responded to the official request of Western Forest Products to have its private lands deleted from the three tree farm licences in question. That question went to the minister's office, and it came to us to pursue and put the decision in front of the minister. I think that's documented in the Auditor General's report, appendix D.

B. Ralston (Chair): So just for clarification, that's the letter of April 28, 2006, that you're referring to that appears in the sequence on page 68.

J. Langridge: November 24 is what's documented here.

B. Ralston (Chair): Well, I'm looking at page 68. Let's just be clear, then. "Letter sent from WFP to the Ministry of Forest and Range re WFP's acquisition of Cascadia makes reference to the deletion of private lands and notes that, subject to the decision, it intends to offer its private timberlands for sale." Then there's a recommendation. The next is a briefing note prepared and recommends the deletion. That's on December 20, 2006.

I just want to be clear that in this sequence, you and I and others here are referring to the same document. So is that the document that you're referring to, or is the
[ Page 352 ]
request an earlier request that's set out in the sequence here? Is that the letter that's sent in 2004 at the top of the page, or what are you referring to?

J. Langridge: Yeah, not having my fulsome records in front of me, it looks like the request was initiated in 2004 and rejuvenated, if you must, subsequent to their creditor protection in 2006. And it was 2006 that we got our marching orders to do the process leading up to the decision.

B. Ralston (Chair): Well, you say you don't have your fulsome notes here. I mean, presumably you came here prepared to answer questions. This is a legislative committee. You're an official of the ministry. Why wouldn't you have those documents here and be prepared to answer detailed questions?

J. Langridge: I can only apologize for not having all of the records that are necessary.

V. Huntington: I can ask my follow-up one here. Well, it's not really a follow-up. I'll jump to another subject, because I'm not sure we'll get to the bottom of that one.

When you're measuring the costs and benefits of this decision…. You say that you were looking at issues other than the competitiveness of Western Forest Products. And you're taking into account, I'm assuming — you say — community watersheds, wildlife habitat, old-growth management areas. How are you measuring those in relation to the decision to dispose of the land? How are you taking those into account and measuring their value?

[1100]

J. Langridge: The approach that we took in that regard is what the change in jurisdiction of the private land would mean and if there would be adequate protection to the values. In the case of the watershed, as an example, there is the Forest and Range Practices Act that provides practices around watershed management, operational planning, etc., under the TFL agreement. But if you take that out of the tree farm licence, we still have legislation that covers watershed protection.

What we looked at was the difference between the two jurisdictions — whether it's under tree farm licence or just private forest land — and whether or not we were satisfied that there was adequate protection. The legislation is robust in both cases. We were satisfied, and that's what is documented in the briefing note.

V. Huntington: In the case of the wintering habitat for the ungulates, as it rolled out under this agreement to discuss…. Initially it looks as if there was an agreement to protect that habitat, but really what it was, was an agreement to discuss the protection. It looks as if you didn't really stand firm on that issue. Who was part of that negotiation, which seems to have taken over quite a long period of time? And whose interest was the minister representing in terms of protecting that habitat?

J. Langridge: On the question of ungulate winter range, we engaged with our colleagues in the Ministry of Environment. The arrangement of the agreement was to transfer the ungulate winter range that was on the private land on to Crown land with similar characteristics to ensure that the same amount of area that was managed for ungulate winter range continued to be managed for ungulate winter range.

What we were able to do was to mitigate the impact of the private land deletion, assuming that the areas would in fact be impacted by increasing ungulate winter range on the Crown land portion.

V. Huntington: As it turned out, the habitat that mitigated it was not of the same value. Whose interests…? Were you negotiating on behalf of Environment, or were you negotiating on behalf of Western Forests Products to protect an adequate and equal amount of habitat?

J. Langridge: Recognizing that I'm a forester and not a biologist, the negotiation discussions were between Western Forest Products and the biologist within the Ministry of Environment.

V. Huntington: What opportunity was there within this whole discussion to retain the higher-value habitat? Did you have any authority to ensure that the old-growth habitat, which is of such significance, could have been retained in a conserved area under covenant? Did you have any authority at all to ensure that?

J. Langridge: I would have to say no. We did not discuss it in terms of the Crown retaining the legal rights to their private land. We never had it in the first place. It was simply a management protocol within the tree farm licence, and the approach we took was to mitigate it to the extent that we could.

V. Huntington: But you had the authority to approve the removal of it from the tree farm licence. Could you not have used that as a bargaining tool to preserve these other areas of public interest?

J. Langridge: I'm not aware of any authority to dictate to Western, short of withholding the approval process — recognizing, of course, that all of this rests with the minister, not with the bureaucrats.

[1105]

We did negotiate — if that's the right word — a number of benefits, such as the private access across private land to Crown timber resources, etc. But through trans-
[ Page 353 ]
fer of values from private land to Crown land we felt that we were able to mitigate to the extent necessary the impacts.

V. Huntington: Just one last question. Did you feel you had the backing, the support, of the minister's office during these negotiations?

J. Langridge: The minister's office isn't actively involved in the discussions. I never felt…. Well, the question was never raised.

V. Huntington: Would they have supported a more vigorous position on behalf of the ministry?

J. Langridge: I can't answer that question. It was never raised.

V. Huntington: Okay. Thank you very much.

B. Ralston (Chair): I'm just curious about preserving this ungulate range. You said the ungulates would be moved from the private land to Crown land. I mean, how did that work? Obviously, you don't send a memo to the herd, and they don't move, so how does that…? Or maybe you do. When you speak of mitigation, it seems there's a certain element of — I don't know — a lack of realism there. Maybe you can explain how that works and what the goal was there.

J. Langridge: I obviously misspoke. We did not move the ungulates. What we're talking about is habitat. The ungulate winter range is a strategy for maintaining habitat so that you can maintain the populations of animals. What we did was identify habitat on adjacent Crown land that would support populations. As I say, that was what got transferred — the protection of habitat from private land to adjacent Crown land.

B. Ralston (Chair): But without any guarantee that the ungulates concerned would move to the new protected area. Would that be fair to say?

J. Langridge: The individual animals may or may not move. The intent was to maintain the population, not the individual animal.

B. Ralston (Chair): I don't see the difference, in the way in which you're expressing it, but I'm not sure I'm going to get a clearer answer. So perhaps I'll turn to…. Unless you had something further to offer.

Then I'll turn to Mr. Les.

J. Les: I would like to briefly touch on page 30, where the Auditor General discusses the unusual trading patterns. I think the ministry staff rightly have taken some exception to the inclusion of that in the report. We were just looking at some of the information that's available on line, and indeed, I believe on one day there was a significant amount of stock of Western traded.

I do not know whether that in fact represented something unusual. I am not an expert in these things. I'm not sure that there's anybody in the Office of the Auditor General who's an expert analyst on these matters either. Nonetheless, an issue like that, when raised, obviously is potentially a serious allegation or a suggestion at a serious allegation. I'm surprised that it's just left hanging out there, casting a cloud over a number of people, perhaps, in the ministry. Couldn't we do better than that?

If you're going to raise the allegation or the suggestion, isn't there at least an obligation to bring it to a conclusion, and prior to that conclusion having been reached, letting the appropriate agency deal with it and reporting out at that point in time? I just think it's grossly unfair to any number of people to leave something like that hanging out there without it having been appropriately responded to.

[1110]

J. Doyle: Thank you for the question. The unusual stock trading was brought to our attention, and then when we looked at it, we concluded that it was unusual. We do have people within the office whose expertise goes that far but not into the detailed analysis of trading and analysis. Potentially, I suppose I could do some work in that area personally, but I did not do so in this particular case.

What we had was a number of letters from people who drew a direct line between that unusual trading and the decision made by the minister. That had been played out in the media as well as in the correspondence to us. We could find no evidence that suggested that there was any such direct link.

We asked questions within the ministry as to the confidentiality of the decision process and considered that it was a robust exercise that was going on within the ministry in regard to that. There was only a small group that were actually kept up to date with what the decision was. The actual decision itself was not flagged by the minister until he'd received documentation.

I think there was no certainty of what the decision would actually be, and yet this unusual trading did occur. So what we did was we raised it with the B.C. Securities Commission. The expectation was that they would do a quick review and give us some feedback immediately. The actual feedback we got from them was that it would take some time for them to conduct this analysis.

Therefore, we were left with the position of not raising it at all, even though it was something that had gone out there and was in the public domain, or raising it and saying how we had dealt with it or tied it off as far as
[ Page 354 ]
our own work was concerned. You will not find a single word in the report which points to ministry staff — or anyone else for that matter — as gaining or getting any benefit.

There's simply a statement of fact that we reported this to the B.C. Securities Commission for them to conduct their work as they deemed fit. Now, what happened was that they gave us an undertaking that they would get back to us once they had concluded their investigation. They did not. They decided to close down on the investigation at about the time, or just before the time, that we published our report but forgot to tell us — forgot to tell anyone, for that matter.

It wasn't until the ministry got in contact with the Securities Commission and asked them what the current status was that we were finally told that in fact they'd decided to investigate no further, which was then too late, because the report had already been published. That's an unfortunate set of circumstances, and I have wondered what I would have said if the information from the Securities Commission had been made available before we published.

I think I would have included a reference that, in fact, the matter has been examined by the Securities Commission and they've decided not to do any further work on it. That would probably have been the way I would have dealt with it.

J. Les: Just one further question, if I might. In your earlier discussions this morning, you take the ministry to task for a lack of documentation that leads to certain decisions being made. In that same vein, I'm wondering if you'd be prepared to release the letters that led to your decision to refer the matter to the Securities Commission.

J. Doyle: No, I wouldn't. The reason I wouldn't is that documentation that we receive and evidence that we collect are protected by our legislation. However, I will do a review of the media and draw your attention to media statements which actually commented on and documented the unusual stock transactions. You may be able to draw your own conclusions from that as to the level of interest that there was at that time in regard to that particular aspect.

[1115]

B. Ralston (Chair): It certainly was a topic of public interest. I believe I raised it in question period on one occasion, so certainly it was in the public sphere.

K. Corrigan: I have two questions. The first one relates to a question to do with whether or not the decision was adequately informed.

On page 36 the report points out that Western Forest Products is 70 percent owned by Tricap, and that company is 100 percent owned by Brookfield Asset Management Corp., which is a global asset manager. We've heard earlier that there does not appear to be documentation indicating what the benefits to British Columbians would be.

Following in that line, I'm wondering if there can be comment on…. What appears to be is that there was really no protection at all that the money would stay in British Columbia or Canada. There was no obligation. Given that Brookfield Asset is a global company, essentially is it not true that this money could simply flow to the shareholders and to the company with no limits whatsoever and no requirements to benefit British Columbia?

T. Jensen: No, there is no guarantee of that.

K. Corrigan: My second question. I don't see reference too much to the issue of sustainability and what impact the removal of private lands has on the formulas for annual allowable cut. I'm wondering if any of the analysis that was done by the ministry includes analysis of what that impact would be.

My understanding is that the amount that is allowed to be cut is based on a rotation of some 80 years to ensure sustainability. If you remove a portion of the land that is being harvested, then would it not impact the sustainability of the tree farm licence because your 80-year rotation would not be appropriate anymore?

J. Langridge: The allowable annual cut impact of removing the private land was taken into consideration immediately by the chief forester, and the allowable annual cut for the Crown land portion that remained was reduced a commensurate amount.

S. Chandra Herbert: I understand that the Auditor General pointed out that there was concern around the fact there hadn't been an analysis and summary of future costs to government. I'm curious. The ministry's response…. Is that a practice that's followed — that there isn't the analysis done? Why wasn't it done in this case?

Also, the second part of the question, to the Auditor General, is whether or not there's any thought, in a few years time, to potentially look back on this process for what the costs really were and to see whether or not the concerns outlined in this report came to be.

B. Ralston (Chair): I believe you're referring to page 34, the analysis and summary of future costs to government. Is that….?

S. Chandra Herbert: That's correct, Mr. Chair.

J. Langridge: In terms of the future costs to government, the only cost that we have incurred to date is the
[ Page 355 ]
cost of surveying the lands that we acquired at no cost. So for a $300,000-ish investment, we got $2½ million worth of road, recognizing that Western, when using that road, will be working under a road permit and will be incurring costs to maintain it. When we use the roads, we'll incur costs to maintain it.

[1120]

In terms of future costs, as I mentioned previously, we have not incurred any to date. We have not got a process in place to try and monitor that on a go-forward basis. We'll deal with any implications, should they arise, as they arise.

S. Chandra Herbert: Sorry. Just to ask the question once more — and I know the Auditor General is considering his response.

The question I had is why there wasn't an analysis done, when this decision was to be come to, of what the wider future costs could be. For citizens, you'd want to know if your decision is going to end up costing you a lot of money or not. According to the Auditor General, it would have been prudent to do this, and I completely agree, but it didn't look like it had been.

The other cost I should just mention is…. I'd been looking for the number earlier. I found it. It may not have been to the provincial government in its entirety, but the cost of Sandcut Beach and the Jordan River lands was about $19 million of the regional district's taxpayers' dollars.

I'm just curious why that analysis hadn't been done, because the decision might have been made in another way if it had been. Is that common practice not to do an analysis of future costs?

J. Langridge: In the case of Sandcut Beach, etc., that cost relates to a transaction between Western and, in this case, CRD, recognizing that those were private lands prior to the decision and they're private lands now.

Under our tree farm licence form of agreement, dating back to the fifties when the tree farm licence was actually initiated, there has been provision for deletion of private land for higher and better use. The utility of that land within the tree farm licence for producing timber was severely constrained by virtue of that higher and better use.

By allowing the land to be removed from the tree farm licence, it allowed that to be realized but, in this case, under ownership of CRD as opposed to Western. We did not sort of delve into the future land use, because at the time, we felt that other levels of government, other processes addressed that land use question.

The Auditor General has pointed out quite emphatically that they disagree, and we've broadened our scope of consultation to address those broader items. At the end of the day, if it is higher and better use in something other than forest management and timber production, it'll be a minister's decision at the time to determine whether they're prepared to go there.

S. Chandra Herbert: Sorry. I'll ask the question once more. Why was there not an analysis and summary of future costs to government done in a kind of comprehensive form?

J. Langridge: The analysis that you asked for wasn't recognized as a need at the time. Consequently, it didn't occur.

S. Chandra Herbert: The Auditor was going to respond to the second part of my question.

J. Doyle: It's not on my list at the moment to go in and conduct a benefit analysis or a cost analysis. It's something that we can consider, but as I say, it's not on my list at this stage. Given the resources that we've got, we have a number of other areas that we feel are important to look at, although this could be a small component in regard to those other areas that we're examining.

J. McIntyre: Just actually a follow-up to John Les's question.

I was wondering if, Auditor General, when you're going to provide this media scan to the committee, you would please include the media surrounding the release of your report, maybe several days after. My recall may be a little hazy, but I thought it was quite a bombshell at the time. I thought that's exactly when it came out — that the B.C. Securities Commission was no longer investigating. So I'd like that clarified, please.

[1125]

J. Doyle: That's exactly what did happen. The report was released, and as a consequence of the report, the ministry rang the B.C. Securities Commission. The B.C. Securities Commission then advised the ministry that they had decided not to go any further with their investigation. Although they had made an undertaking to us to tell us when they had concluded their work, they did not do so, and as a consequence, we didn't know. We thought it was still an ongoing investigation when we published the report. We didn't know that it wasn't.

So that's exactly the way that it actually played out at the time. The ministry did then announce — I can't remember exactly how they did it — that in fact the Securities Commission had decided not to go further with this unusual stock trading. It was played out in the media at that time, in public.

J. McIntyre: So maybe there could have been an addendum to the report or something.
[ Page 356 ]

J. Doyle: There's no capacity for me to put an addendum to the report. The report is the report.

What happened was that it became immediate public attention, and in fact that subcomponent of the report had been dealt with in an alternative way and had been cleared.

You know, there are lots of reasons why an investigation won't go forward, but the real issue is that no investigation was continued and that became public knowledge very quickly. I think it was in a lot of the news media, and that's how it became public knowledge.

Now that I've said that, do you still need the news releases for the period after the report?

J. McIntyre: Well, it would make sense, because if you're giving the media release that prompted the investigation you might as well show how it all rolled out. Why give half the picture?

J. Doyle: Okay.

B. Ralston (Chair): Maybe we could get the assistance of the public affairs bureau, as well, because they do seem to have some capacity to monitor media.

D. Horne (Deputy Chair): Given that we're adding some levity, I'd like to let you know, Chair, that the government's side is comfortable in your leadership and that we won't be questioning it.

B. Ralston (Chair): It's the first I've heard of it.

D. Horne (Deputy Chair): Well, you know, given what's happened since our last meeting.

B. Ralston (Chair): So far I'm content with your role as vice-Chair. [Laughter.]

D. Horne (Deputy Chair): Thank you. Thank you.

B. Ralston (Chair): Don't push me.

D. Horne (Deputy Chair): On the issue of the trading that took place in the stock in January in Western Forest Products, I just had a question. Obviously, if you take a look at the stock chart, there's a day of unusually high volume which is followed by a very quick return to normal trading patterns. So for the Securities Commission it wouldn't be investigating a long period of time. There obviously is that trade.

I haven't looked at it myself, and I'm wondering if you're aware. Was that simply a block trade that happened that day? And if it was indeed just a block trade, which is fairly normal within securities, I'm wondering why that would continue to be a portion of the report given the fact that by the time the report was issued we had sort of returned to normal trading.

J. Doyle: Thank you for the question. My understanding was that there were a number of individuals trading — not individual names but companies. I don't think it was a block trade that was actually in the way that you're describing. However, we stopped delving into who would be doing that.

To get behind that transaction is actually quite difficult for us to do, and so we passed over the information to the Securities Commission. Our expectation was that they would be able to give us a quick reply. When they told us it was going to take months, then we basically said: "Okay. Well, you carry on. We'll just refer to the fact that we've passed this over to you, and at some time in the future we'll get a response."

[1130]

As I say, there was then a miscommunication about getting back to us with the information. They've actually not come back to us with any analysis or detail whatsoever in regard to referral of this matter to them. So I have no further knowledge, other than what was available to us, which was that it was unusual and warranted some further examination.

B. Ralston (Chair): I don't see any further questions. Oh, Spencer.

S. Chandra Herbert: Yes, thank you, hon. Chair. The question that you raised earlier about certain memos, certain dates, and requesting that information from the ministry…. I'm just curious if the ministry might be able to provide that information to us. I don't know. End of day, once they leave this place, they can go back and check their notes. I know they expressed regret that they didn't have that information ready for the committee.

Would that be appropriate, Mr. Chair?

B. Ralston (Chair): Well, then maybe…. I think you'd have to be more specific, in order to be fair, as to what memos you're seeking.

S. Chandra Herbert: Sorry, hon. Chair. It was the information that you were seeking from them that I was referring to.

B. Ralston (Chair): I believe Mr. Langridge made reference to a sequence of events and a memo, or letter, requesting the deletion. I believe that's the letter in 2004 that's referred to.

Perhaps Mr. Langridge, if that's clear, you could confirm that that was the letter that you were referring to that initiated this process. Is my question, then, sufficiently clear for you to act on that?

J. Langridge: Yes, thank you.

The letter that initiated the process was, in fact, the 2004 letter that's referred to in the Auditor General's report. My
[ Page 357 ]
confusion is that it was reinvigorated in 2006, and hence, my confusion. It was the 2006 reinvigoration that led us to the process that resulted in the briefing note that we put in front of the minister.

S. Chandra Herbert: Just a question. What is a "reinvigoration" of a letter? I don't understand the terminology.

J. Langridge: Basically, they asked. They went into creditor protection. They asked again.

S. Chandra Herbert: Okay. They referenced a letter that they'd already sent and said, "We would like it to be revitalized" or something — put it on a new paper stock.

B. Ralston (Chair): I don't think it's necessary to provide that correspondence.

Just, though, to follow up on that just before we leave this file. Are you saying, then, that the initial request in 2004 was basically not acted upon and had fallen away, and there was no intention to act on it? It was only when the letter was received — a new letter — in 2006 that that was again the subject of scrutiny by the minister and the ministry officials.

J. Langridge: There was a significant delay, around First Nations consultation, in us proceeding with managing this file. There was litigation that we were monitoring as to whether or not deletion of a private land was in fact a decision that required the full-court press on First Nations consultation, or was it a notification. We got that decision and determined that we had to do First Nations consultation — hence, the delay.

Western was aware that we were waiting on that decision. Once we got that decision, it was clear what we needed to do, and we proceeded.

B. Ralston (Chair): I don't see any further questions.

Mr. Doyle, you had a concluding remark.

J. Doyle: Just a final observation, Chair. In their presentation the ministry referred to the fact that there was, in this particular report, "no response from the ministry," which is our normal practice. You will find that there have only been two reports that I've seen where there's not been a response. This was one. The other one was where the ministry determined that they did not wish to make a response.

[1135]

We actually provided the draft documentation for a response, but we did not receive one. We waited for a number of weeks before we then determined that we would go forward with publication.

On publication there was a media briefing circulating to the media which addressed all the issues, which I took to be the response from the ministry. Therefore, I published that and put it on my website so that any citizen who was interested could actually have a look and see what the response would have been, given the fact that it wasn't published within the actual body of the report. I just wanted to clear that up.

B. Ralston (Chair): Mr. Langridge, you wanted to respond?

J. Langridge: The Auditor General is absolutely correct. They did afford us a window of opportunity to respond to a draft report. It was in the context of providing input to a draft report. That culminated in a meeting with our deputy minister on July 3, I believe.

We were given a matter of days to respond to the Auditor General's draft report, but at that point we had no insight as to how the Auditor General was going to respond to the input we had given to the draft report, and in fact, we were not given an opportunity to respond to the final report. We were a little unclear as to whether our response to a draft report would, in fact, reflect the final report.

Consequently, the choice was made not to provide him with the response. In effect, we were just not prepared to respond to a draft report that is subject to change, based on the input that we'd given him to that draft.

R. Lee: Yeah, just on that note. You said a communication problem between the office to the ministry…? Because if this is a standard practice of providing opportunity for the ministry to respond and then including in the final report, is that the way to do it? I saw some report with the ministry's response there. I am just wondering. Is that one time, or is that the standard practice, or is it a formal protocol to do it?

B. Ralston (Chair): I think it would be a question of general interest to members of the committee, because most of the reports do have a written response from the entity or agency concerned that's published with the report.

So perhaps, Mr. Doyle, you can provide us with some guidance on that.

J. Doyle: We go through several processes to make sure that the information we provide is, in fact, accurate. Before the report is drafted we go through what's called an evidence confirmation process, which is that, at the end of the field work, we go back to the entity and make sure that we have in fact collected the evidence, that we've interpreted it correctly, and then we can start writing our report. That's a formal process that we actually go through with a face-to-face meeting and an exchange of documents.
[ Page 358 ]

What we are talking about now is a little bit further along the process, where a draft has been prepared and provided to the entity. Now, typically what happens is that the entity comes back with concerns, observations or a response. In this particular case, we had some telephone calls, but there was no response. Three weeks was the amount of time that we actually provided at the end of a fairly lengthy audit process.

So what we can expect, and what normally happens in all of the other reports that we've done, is that an entity would come back. This happened recently, and they came back and said: "Actually, we don't like the report. We think that you've got this bit wrong, and we need to talk it through."

[1140]

We had, in that particular case…. It was a minister who spoke to me about it. We sat down, and we said: "Well, what do you think we should be doing in the way of collecting additional information?"

We did that, and then we published the report at a later stage. They had the draft response to us ready, but once they had explained that they felt that we should do more work, I was happy to go away and conduct that extra work and then revise the report and then come back to them with that particular report.

That is a robust process that has been in place now ever since I've been in this office. It's unusual, because most jurisdictions don't bother getting responses from entities. They just publish, and then it's up to you to defend yourself in the public arena, whereas we go through an exercise which tries to talk about that whole exercise in advance.

In this particular case we didn't get a response. We did get some feedback, but we didn't get a formal response, which is our normal requirement. We don't expect everyone to agree with everything we've said. We just expect them to respond the way they want to respond.

If you look at some of the responses we've had in the past, some of them have not been all that charitable in regard to the quality of our work or what we have done. Sometimes what we have done there is go back to try and resolve those issues before we actually publish, and sometimes we continue with publication of the entity's response to us. We never edit it or change it.

R. Lee: It's a formal timeline for within, say, three weeks that you have to respond; otherwise, we assume that you don't have a response to that. Is there a timeline on there now?

J. Doyle: I do usually set a timeline. I have had phone calls from deputy ministers in the past that have requested that I extend that timeline so that they can actually get their response back to us in the proper form because there was some extra work they had to do. I've either received those as direct phone calls to me at my desk, or I've received them via e-mail or via the audit team itself.

It's an interactive process. We usually ask for ten working days for a response. What you've got to remember is that this isn't the first time that this document would have been there. It would have been something that had been in discussion. By that stage, you're usually narrowing it down to areas where you have concerns, and you're looking at where the variations or where the changes in words have occurred around those areas. It's not the whole document; it's certain aspects of the document that seem to be the pressure points.

R. Lee: Okay. Final question. If the ministry actually is providing the response, that response will be included in the final report. Is that true?

J. Doyle: The response that we get back from the ministry, if that's what they want to say, then that's what's published.

B. Ralston (Chair): Okay. Thank you very much.

I think we've concluded on this report.

Some lunch will arrive at about noon, so I'm going to suggest that we recess until 12:15. Then we'll deal with the two reports in the afternoon. So at 12:15 we'll reconvene.

The committee recessed from 11:44 a.m. to 12:16 p.m.

[B. Ralston in the chair.]

B. Ralston (Chair): We're going to deal with report No. 5, which was an audit of the Agricultural Land Commission.

From the Office of the Auditor General, we have Mr. Doyle, the Auditor General. Morris Sydor, the assistant Auditor General, is responding on behalf of the agency and government. Richard Bullock is the chair of the Agricultural Land Commission, and Brian Underhill is the executive director of the Agricultural Land Commission. I'll turn it over to Mr. Doyle to begin.

Auditor General Report:
Audit of the Agricultural
Land Commission

J. Doyle: Thank you, Chair. Before I start my presentation in regard to the Agricultural Land Commission, may I introduce to you Nigel Gibson, who is behind us in the gallery. He's from the Barbados Audit Office and is seconded to my office for a 12-month period under an exchange program fully funded by CIDA and managed by the CCAF, which is the Canadian Comprehensive Auditing Foundation based in Toronto.
[ Page 359 ]

We've twinned with Barbados, and we're assisting them with our work. As part of that process, they send staff over to us, and we train them as performance auditors and then send them back to Barbados where they, in turn, train others and do performance audit work.

B. Ralston (Chair): Thanks very much. Welcome to our proceedings.

J. Doyle: The audit of the Agricultural Land Commission. The commission is an arm's-length tribunal which is responsible for administering the agricultural land reserve. The reserve is made up of approximately 4.7 million hectares of land which is located throughout B.C. This land was set aside in the 1970s, and later, due to concern over the loss of agricultural land to urban development.

The commission makes decisions on applications for non-farm uses, for subdivisions and to add or remove land from the reserve. The commission works with local governments on land use planning as well as on compliance and enforcement activities.

Last year the commission reported that 95 percent of respondents to a public survey supported the agricultural land reserve and the policy of preserving agricultural land. Preservation of agricultural land is fundamental to securing food production for future generations, particularly given the uncertain effects of climate change on our food imports and on our agricultural systems.

In 1994 my office examined the commission's performance and found that there were a number improvements needed if the commission's mandate was to be met. Sixteen years later and upon re-examination, the commission is still experiencing significant challenges. For example, preserving the agricultural land and encouraging farming in B.C., protecting the agricultural land reserve through its compliance and enforcement, and evaluating and reporting on effectiveness were all issues that we considered as part of our audit examination.

With me today is Morris Sydor, assistant Auditor General responsible for environment and sustainability. Behind me in the gallery is Amy Hart, the manager responsible for this particular audit, and Beth Sobieszczyk, who is the analyst responsible in assisting Amy in the conduct of this work.

[1220]

I'll now turn it over to Morris to go through our presentation.

M. Sydor: Thank you, committee Chair, committee members. We've had a bit of a brief background, and I'll take you quickly through the audit. The purpose of this audit was to assess whether the commission is, first, effectively preserving agricultural land and encouraging farming; whether it's adequately protecting the agricultural land reserve through its compliance and enforcement activities; and lastly, whether it is adequately evaluating and reporting on its effectiveness.

On the first question, we found that the commission is challenged to effectively preserve agricultural land and encourage farming. There are a number of issues that we raise in our report. Specifically, the commission has not determined that the boundaries of the ALR are accurate and that the reserve includes land that is capable and suitable for agricultural use.

As well, the commission has identified limitations in its ability to preserve agricultural land and encourage farming through the application process. The commission is not sufficiently involved in proactive, long-term land-use planning with local governments to encourage farming on a broad basis. Lastly, oversight of the decisions made by delegated authorities needs strengthening.

With regard to compliance and enforcement, the commission has a mandate to ensure that activities in the reserve are consistent with the act. We found that the commission established a compliance and enforcement program in 2007 but that the activities are inadequate.

Policies to guide activities have been established by the commission, but the commission has determined that the resources applied are insufficient and that the available tools limit its effectiveness. Informal tools, such as letters and verbal communication, are not enforceable, and formal tools, such as stop-work orders or remediation orders, may result in legal action that the Agricultural Land Commission is not resourced to deal with.

The commission is working with local governments, but formal agreements are not in place, so these compliance and enforcement issues may not be priorities for local governments. As well, discussions were underway with the province around the resource management coordination project, which may lead to greater access to provincial compliance and enforcement staff.

On the third question, the commission has been unable to complete development of an electronic tracking system database as initially planned, so there was uncertainty about when the new system would actually be functional. This limited the information available for evaluating the impacts of its decisions. We noted that the annual report contains a lot of statistical information about decisions but not on key measures of effectiveness, such as on the cumulative results of its decisions on the agricultural capability of the land base.

Our report contained nine recommendations. The first five related to issues surrounding question 1, preserving agricultural land and encouraging farming. Recommendation 6 addresses the issues around the compliance and enforcement program, and the last three deal with evaluating and reporting on effectiveness.

That concludes my presentation, Chair.

B. Ralston (Chair): Thank you.
[ Page 360 ]

B. Underhill: What we'd like to do is really briefly highlight the nature of the commission's responses to the recommendations. At the outset, we'd also like to say that we appreciated…. We worked, we think, very closely and hard with the Auditor's staff over more than a six-month period, and we believe that the recommendations did capture the essence of the commission's work and some of the challenges that it is facing.

Just really briefly — we've touched on it already — the commission's mandate is three parts: to preserve and to encourage and, also, this connection to local governments, which together make the mandate of the commission.

Again, definitions. We really don't need to spend much time on that, but the ALR is the zone which represents that approximate 5 percent area, and the commission is the entity, or the tribunal, that Morris has referred to.

[1225]

Just again, some more context. The ALR is approximately 5 percent of the land base, but of that 5 percent a smaller proportion is suitable for growing a range of crops and an even smaller proportion is identified as prime agricultural land.

Distribution-wise, on the map of British Columbia it's interesting to note that close to 30 percent of the agricultural land reserves are in the northeast part of the province. When you combine that with the northern, the Prince George and the central Interior plateau, over 50 percent is in that region, in the northerly half of the province, and the remainder is in the valley bottoms, including the Fraser Valley and also on the east coast of Vancouver Island, some of the more productive lands for the broader range of agricultural uses.

Really briefly, the audit recommendations were grouped, as Morris has indicated. With respect to the first audit recommendation, really it's talking about the need to do further work on determining the accuracy of the ALR. The ALRs were mapped, and mapped rather quickly, in the early 1970s, and there is an opportunity for more work to be done.

Some work has been done on what the commission terms as fine-tuning of those boundaries. The application process on an ad hoc basis is really not a comprehensive way to address the appropriateness of the ALR boundary. What we are suggesting is that an approach would be more comprehensive in doing it by region or subregion.

Audit recommendation 2 refers to the application process and how encouraging farming is accomplished by the commission. In part, we reference a recent report by the commission chair to the Minister of Agriculture. It's been a really comprehensive report to address many of the facets of the commission and all the facets of the commission's operations and how it governs itself.

That report is in the hands of the Minister of Agriculture for review. It goes a long way to suggesting opportunities to address this recommendation, in particular in the application process, which some people believe is a little bit counterintuitive to the mandate to preserve agricultural land. There might be an opportunity to look at that, and we have begun to slowly start to explore legislative options.

Recommendation 3, again, speaks to another aspect of the commission's mandate, which is working in a planning context, primarily with local governments. There are over 140 local governments. That includes all the regional governments throughout the province that have land within the ALR.

This places the commission in a position of having to work with those organizations very closely. We've done that over the last four decades, but we really believe that we need to become less reactive and more proactive, in terms of planning, to get out ahead and engage earlier with local and regional governments and be strategic about the preservation of agricultural land.

Recommendations 4 and 5 refer to the commission's delegation tool or the ability to enable shared decision-making with regional or local government. In this case there are two regional districts that have agreements with the commission. These are voluntary agreements on how, based on criteria, certain decisions are made about change of use or subdivision within the ALR.

The other delegation agreement is with the Oil and Gas Commission. What the audit found is that there needs to be a strengthening of the oversight of the commission. We have noted that and have had some struggles, but also we have done some oversight. We really believe we need to enhance that.

Audit recommendation 6 touches on the compliance and enforcement. As Morris has mentioned, the commission's initiative in this regard began in 2007. Really, the strength of it is going to be found in the relationships we build with staff, the authorities and the local governments throughout the province and the regions and also in building a relationship within provincial government circles.

[1230]

Work has been moving forward in regard to both of those areas, but there is work yet to be done. The capacity that the commission has is somewhat limited in order to be able to do that extensively at this time.

Just a couple of graphics to show some of the challenges that the commission is facing in some regions of the province, both from unauthorized dumping and then unauthorized uses in certain areas.

Audit recommendation 7 deals largely with the database. As Morris has mentioned, 7, 8 and 9 deal with the commission's information base and reporting and the ability to do all of those things that are necessary to inform the research that the commission is doing and should be doing with respect to applications and the potential impact on the agricultural land reserve.
[ Page 361 ]

The key here is that we need to establish a priority to complete our database. We have made progress, but there is still work to be done to complete our data so we can then tax it to help us in our research and our decision-making.

Just a brief sample. I think this is similar to a graphic that was in the Auditor General's report. The interesting thing here is that the graphic in the bottom right-hand corner is showing the state of the maps and the fragility of them. Work has begun. They're not all like that. We have begun to convert to a digital format.

The graphic in the top left is showing, really, the way in which information is recorded on maps. This is a way of the past and has been the practice for 30 years. We have defined a program in order to take this and bring it into the digital world, if you will. This map shows there's really very little more room to add information to that map.

The last two recommendations go to the question of reporting or evaluation, both of the cumulative impacts and the individual impacts and what the results of those are, of the commission's decisions. It's an area that the commission has identified as wanting to improve on.

We believe we've done a fairly good and a comprehensive job of reporting on what has happened in terms of the boundary or the changes to that boundary. We don't really report well on what's happening within the zone — the changes due to land use change, if they are approved, or subdivisions. That's a piece of work that we've identified that needs work.

We need to complete the population of our database so it's consistent and, as I say, complete. We're working with the corporate services division, which supports us in our need for, basically, the funding or the resources necessary to complete that database. We are starting to get some headway there, but more work needs to be done.

I've alluded in several places to where we are working on a Treasury Board submission. In fact, we are working on that. We're not at the stage yet where it's complete, but we are identifying what we believe would be needed in order to move the commission forward.

B. Ralston (Chair): Thanks, Mr. Underhill.

I'll put together a list, then.

Spencer, why don't you go first?

S. Chandra Herbert: Let the others. I've asked plenty of questions today.

B. Ralston (Chair): Everyone's deferring to you, John, so why don't you go ahead?

J. Les: I have a question that's often occurred to me, actually, and I thought today might be a good time to put it, particularly, to the Land Commission folks that are here.

We often refer to 5 percent of the land area of British Columbia in the agricultural land reserve. To me, I'm not sure that's a very good context, given the topography and geography of the province of British Columbia. It's really a statistic that doesn't do anything, I think, in terms of illuminating whether we're accomplishing our objective in terms of the agricultural land reserve.

[1235]

Much more interesting to me would be a juxtaposition of the current area that's within the land reserve and the area that might have been in the agricultural land reserve absent any development. That would be, I think, an interesting exercise. It would give us some context with which to judge how much agricultural land has been lost.

If you look at the Lower Mainland, which obviously I'm most familiar with…. I look at a place. Just to name one — the city of Richmond, for example, probably would not exist today had the land reserve regulations and legislation been in existence a hundred years ago.

It's that kind of comparison that I think would be much more useful than juxtaposing the area of land in the land reserve to all of the mountains and up-and-down terrain that we have in this province, which is a comparison that, to me, is of absolutely no value. I wonder if the commission has ever turned its mind to that, to sort of providing that more relevant context.

B. Underhill: Thanks for that question.

No, the commission has not carried out that analysis, but I think it's something that could be done. One of the bases for the establishment of the reserve was the soil capability information. With that information, if it covered those urban areas or those areas that have been taken over for development, then we could do that analysis.

I think it would be a good contextual piece that would help understand where that balance is and give more meaning to the 5 percent that you mentioned. But it would require a fair bit of information-gathering and defining what could have been agricultural land so that we could do that analysis.

I appreciate that suggestion.

S. Chandra Herbert: Thank you, Mr. Les, for jumping on the question.

Part of the issue is that boundaries are not necessarily that well defined. There are challenges with the…. Well, the maps are crumbling. We saw that. But also municipal governments….

What would the proposed working partnership with municipal governments look like? I know that was discussed as a possible way forward, given the under-resourced nature of the commission. I ask that because I know there has been some concern in the past about municipal governments being more interested in development than in protecting food security.
[ Page 362 ]

R. Bullock: I'd just like to answer that in terms of what municipality. There are so many different variations on that theme. We've got some municipalities that work very well with us up front, and we've got others that have very little interest in dealing with us until they've made their decisions, and then they lay it before us in order to make the hard ones.

I guess what we're trying to do and what I would like to do as chair is move this commission forward to work with, if not all, all municipalities and regional districts on a very proactive…. Make us part and parcel of that upfront decision-making when they go forward to develop their plans and municipalities.

As Mr. Les said, if we had this process in place, Richmond may not be there. I disagree. Richmond probably would be there, but a very different Richmond than we see today. I think that's where we come in, in that discussion. It should be early and it should be often, rather than coming in the back door. When the tough decisions need to be made and we can't make them, we leave them to you.

L. Popham: First of all, I'd really like to thank Mr. Doyle for doing his report. It's a relief to see it in black and white, because those of us who are concerned about food security almost need to make an argument for it, and this really helps us do it. The neglect of the support for the ALC — for me, it's alarming, and it's inexcusable.

That being said, I'm very much looking forward to the report that Mr. Bullock is putting out. I'd like to know when that is going to be available.

[1240]

Also, the reflection on a third of the budget disappearing from the ALC since 2002 is disturbing to me. I'd like to know, within the report that's coming out, would there be a recommendation of how much would be needed to support the ALC to fulfil its three-part mandate?

R. Bullock: Yes. I can answer both of those. The report has been handed to the minister, and Minister Stewart is the one to ask about when it's going to be made public — if, in fact, it is.

As far as dollars, we are working very closely now with treasury, putting together what we think is a business plan to make our organization as effective as it possibly could be, or far more effective than it is today.

V. Huntington: Without going through a bazillion details that I could go through and would love to talk with you about some other….

B. Ralston (Chair): Is that a parliamentary term?

V. Huntington: No, that is not.

One of the issues that is substantial for members of the public — not necessarily the industry, but the public — is that they don't see the commission as, as independent as it ought to be. I'm wondering if you are dealing with that and how you are dealing with it.

R. Bullock: I can't speak for the commission in the past, but I'll speak for it now and going forward. I've made it very clear to the minister when I took this job that I understood independence, having come from my background. We do guard that very seriously.

While we want to listen to everyone that has an opinion and points to be made, the decisions that are made are very much those of the ALC. It's been a longstanding issue within this organization since its inception. But I think everyone has got pretty well to the point with understanding that the decisions of the ALC are the decisions of the ALC.

V. Huntington: How are you, as chair, going to deal with the perception of non–arm's length on any particular application where there's an appearance of bias in a panel, because it's a regional panel or where panellists know individuals making the applications? How are you going to deal with that? Do you feel it's a problem?

R. Bullock: I think it's an issue. There are constantly issues of bias in all organizations. I think it's certainly my job to let my commissioners know that when they're making decisions on the commission or about the commission or on issues that are before them, they're to be made at arm's length.

It's particularly difficult dealing with the makeup of the board as it is today. It's a fairly diverse group, it's quite large, and it's from various parts of the province. With our report, we have something to say to that.

Regardless, our members, when they're appointed, have to understand that they're appointed on behalf of the people of the province and that, like everyone around this table, they've got to make those decisions on behalf of the people of the province.

V. Huntington: I didn't note it in the report, but do you have, or are you planning on instituting, guidelines to publicly deal with that issue of conflict?

R. Bullock: We do have guidelines, and we do follow them. But again, as I said, I'm not sure what went on in the past.

It's one of the things that I feel very seriously about. I will be…. In fact, I have talked to my commissioners already on conflict. It is something that with our organization is one that is very easily seen — particularly perception, and sometimes, as you're aware, perception becomes reality very easily.
[ Page 363 ]

V. Huntington: Quite often.

B. Ralston (Chair): We have some experience with that.

R. Bullock: I understand that.

[1245]

V. Huntington: Yeah. I think the credibility of the commission is very, very important, and I believe it does have some work to do in that area with the general public. I don't want to speak for the industry, because I think some members of the industry have different motives for applications.

Within the body there was some criticism of not having defined that land which was suitable for farming. Usually when that issue comes up, it's in the context of removing land from the reserve that is not of a classification good for production, which therefore means that really what you're doing in defining the land is reducing the size of the reserve. How are you going about defining that, or have you set up a plan for that yet?

R. Bullock: It would be my hope that we could do a far better job than we're doing now. Basically, what we're doing now is defining the ALC throughout the province by the individual application process.

That, to me, is a major concern. I'm not sure that's the way we should be doing it, and I'm not sure… I think Brian alluded to that in his report — that the application process is in many cases probably working counterintuitively to what we're trying to do.

We've got a process in place that's basically saying: "I've got a piece of agricultural land that I'm prepared to speculate on. I bought it today, and I can put an application before the ALC tomorrow and hopefully either get it removed or change its application in such a fashion that it becomes far more valuable than it already is." Frankly, it's probably extremely valuable to the public, more so than it is to the individual.

So that's what we're up against constantly, and it's one that I would hope to change, going forward, in terms of moving away from the individual and going towards planning the agricultural reserve on a far more broad basis, including municipalities, regional districts and the like, and bringing them into the process rather than just the individual.

V. Huntington: One last, and then I'll come back, Mr. Chair.

Would you be moving toward, hopefully, a hard edge at some point, so that it would reduce conflict and speculation?

R. Bullock: The quick question is: I'd love to. In some parts of the province I think that's possible. We have got to the point…. I think you can pick those areas as well as I, as opposed to other parts of the province. As Brian alluded to, 50 percent of the ALC is from Williams Lake north, and that's a much different problem. I think we've got major boundary issues that need to be dealt with there, as well as the East Kootenay and the West Kootenay.

But there are other parts of this province where I think everybody agrees to the boundaries pretty well now. Whether there's a hard edge to them or not I think is going to be up for debate in the next month or two.

K. Corrigan: I have a number of questions, so maybe I'll ask a couple of them now and then you can go on to somebody else.

I'm trying to understand what the process is. On page 11 the comment is made in the report: "The commission has limited ability to preserve agricultural land and encourage farming through the application process. Currently the commission is required to respond to all applications for change, even those that request the removal of capable agricultural land from the ALR." There is then a suggestion that maybe a change to the Agricultural Land Commission Act could avoid these kinds of situations.

Is not the Agricultural Land Commission…? If there is a piece of land that is capable agricultural land, does it not have the very clear authority to preserve that land, and if so, why would there need to be legislation that protects that land — or legislative changes?

[1250]

B. Underhill: I think the way in which the commission is going to determine if it's suitable and capable is as a result of the application process. So the commission gets into that, and yes, the commission can make a decision to say: "No, this is suitable land, and therefore, the use is not going to change."

In that respect, you do not need to change the legislation. But what we're talking about in this section, I believe, is that there might be opportunity, if the scientific information is good — the mapping or the soil information — then, in those cases, to avoid having an application in the very first place.

Therefore, in order to do that, we would have to have information that we can rely on, that we believe is accurate, and also a potential change that would say — for example, as suggested in the Auditor's report — that such lands that are in a certain category — prime, for example…. Then you cannot make an application in those particular cases. But I think it's a combination of work to be done.

It's sort of what we do now and what we think might be possible to do in the future.
[ Page 364 ]

K. Corrigan: I have a follow-up on that. Is there now, because of the pressure on the resources…? I think one of my colleagues mentioned, expressed concern, about the reduced budget for the agricultural land reserve. Is the ability to evaluate land in any way hampered by the lack of resources that the Agricultural Land Commission has? And in these situations where people make applications, are you concerned that at times that evaluation might not be appropriate and we might lose some land because of the compromised position of the ALR because of funding?

R. Bullock: Funding is certainly an issue. We deal with every application that comes before us, but as everything else, adequate and appropriate funding to do the job is certainly better than not having enough.

K. Corrigan: Just one more follow-up on that. I guess, to put it another way, is it your concern that land that should be being used for farming or kept within the reserve is being released because of a lack of resources to appropriately monitor, identify, evaluate land?

R. Bullock: No.

B. Ralston (Chair): I hope all the answers are as short as that. I'm just kidding.

J. McIntyre: Nice to see you here, gentlemen. I want to thank the Auditor General and the commission for having us look at these issues. As some of you know, I was on the Agricultural Planning Committee for 2½ years, so I have a very healthy respect for all that you do and the issues you're trying to deal with in this area.

I certainly think most would be reassured that in all the travelling we did around the province, there was widespread support for the protection of agricultural land, but it was pretty clear that there needs to be a modernization of it and a whole look at priorities and, I guess, how we deal with some of the conflicts that have been around for as long as the ALR at least. So I'm delighted and looking forward to your review, Mr. Bullock, and I guess we'll see where we go from there.

One of the things that I…. I don't want to sound too naive, but in the whole issue that you pointed out about the mapping and the need for resources in mapping, has there been any attempt to explore using others? I was thinking immediately of Elections B.C. and, actually, the commission they did, which was…. I think there were millions of taxpayer dollars spent on looking at all the ridings and redefining. We all got an electronic copy. For the first time, I think, that a report was ever issued in the Legislature, we got it in electronic format.

So there is a huge amount of money and resources that have already been spent, probably, on mapping the province from other agencies, other ministries. Is there a way to perhaps share those resources, or am I being just too Pollyanna-ish here?

B. Underhill: No, you're not, and yes, there is, and yes, we are to the extent possible.

I should just clarify that the ALR boundaries throughout the province are what we call digital. So we have accomplished that. Those are in place.

[1255]

Now what we're talking about is taking that and getting other layers of information, if you will — the soil information, the lot lines.

Then the other part of this, which I alluded to, was to bring in the information on past decisions of the commission or planning information. That's where we need some help.

A lot of it is something that we need to do, because we own the information or we have it, but we need to now take that, take it out of paper and put it in a digital so that we can then start to reuse it.

J. McIntyre: So it's layering on your….

B. Underhill: Yeah, a lot of it is labour, but it is still something that we can use help on. It might be short-term help, and then we're done and move on to the next task.

Good question.

L. Popham: I guess my question is around the request to the Treasury Board. I'm wondering: if the budget remains the same or is reduced again in the next provincial budget, would any of these recommendations be able to be addressed? That's to Mr. Doyle.

To Mr. Bullock: is there a priority of these recommendations that you would address first under a constrained budget?

J. Doyle: I don't think I'm in a position to answer that question. I think it's best directed to the commission, because they're the ones that submitted the budget request and would know the internal mechanisms within the commission much better than I would.

R. Bullock: As of now, we're dealing with, I think, the recommendations that Mr. Doyle and his team have made to us. That is around, in the report that I've laid out before the minister, the treasury submission we're making.

Having said that, it's certainly not up to us to make those decisions. Those decisions will be made on our behalf. Once we know what those requests are, we'll begin to either deal with all of them or begin to deal with our priorities.

As of now, we're trying to keep the organization going as best we possibly can. I'd like to say that I think staff
[ Page 365 ]
are providing an extraordinary service for this province, doing a huge amount of work with the kind of resources that, if I was in my business, I'd be awfully concerned about keeping the darn thing going if we have to carry on at this pace.

Having said that, we're going to address the issues that Mr. Doyle and his crew have brought up, plus the things we need to do. That doesn't mean to say that we're not going to do them as efficiently as possible and change a lot of the ways that we do things. But as of today, we're just going to deal with what we have, and that's $2.1 million to look after five million acres in the province.

L. Popham: Regarding the issue around the mapping, that seems to be something that can't be ignored anymore because the maps are falling apart, and they look like they're not completely readable.

Is that something that would be able to be addressed regardless of the treasury submission?

B. Underhill: Yes. In fact, we haven't waited for the treasury submission. There's a lot of work to be done. But the maps, which we showed you the picture of, are deteriorating, yes. We ourselves have started, as the resources or staffing ability provide, to actually start to take those and move them into a digital world.

We are starting that anyway. My concern is the length of time it's going to take in order to do all 27 regional districts and all 500-and-so map sheets. They don't all look like that, but they're in varying degrees of repair.

So this is an area, as I mentioned…. I'd say that if there was a priority, that would be fairly high up. We are starting to because we know we have to, in whatever way we can.

R. Sultan: On a day when maybe our friends on the opposite bench could benefit from some unsolicited praise, I would like to seize the rare opportunity to compliment them on a good idea — namely, the agricultural land reserve. I think the track record of this institution inspired by you folks has served our province very well.

[1300]

I have two questions of just a factual nature. One is that you refer to — in a sense, it seems to appear — some trade-offs, or certainly the need for closer integration of the decisions of the Oil and Gas Commission and ALR. It's always my impression, flying over those oilfields in southern Alberta, that the wheat crops pretty well go up to the wellhead. Are there some trade-offs there? Help me understand it better.

R. Bullock: Can you just elaborate?

R. Sultan: Well, the recommendations of the Auditor refer to the need to work more closely with the Oil and Gas Commission, which I assume refers to some trade-offs in their decisions impacting your decisions or vice versa. Can you help me understand what you're getting at?

R. Bullock: There are a number of issues in the oil and gas issues up north and starting to move into some other parts of the province, where there are major disruptions to farmland. As you see, from 40,000 feet they look rather well operated; from 40 feet there are probably some issues. That's the way they use land, how they leave it, the amount of water that's being used in some of the new technologies, the fracking that's going on in this day and age.

You've all heard about Dawson Creek running out of water this past summer. I was concerned about the amount of water that they had to operate the city, let alone everything else. There's a huge bunch of issues. Another one is one we're dealing with directly, and that's pipelines that come under federal legislation that can basically be put wherever they want to be put and have huge implications.

Now, is that our issue, or is that someone else within the provincial government? It's a big one. It's getting to the point where we have to deal either far more closely with these issues on our own or make sure our delegated authority with the oil and gas people is working, not only on behalf of the agricultural community and the land that is being dealt with but on the bigger issue as to what is being left when all of this is done.

We've got a number of wells coming to the end of their life cycle up in that part of the world now, and lo and behold, we can't find the people that actually put them in the ground. Who's going to put the ground back in order?

I guess that's one of our concerns. I think we agree with all the economics that come and are positive for the province with the oil and gas issues. What we are concerned about is that when they're done — and that may not be today; it may be 50 or 100 years from now — that land is still usable for what it originally will be, because it all does come to an end.

Again, I take my job very seriously. I'm here to speak on behalf of a lot of the folks in this province who still aren't born so that 100 years from now that land is going to be useful, because frankly, from an agricultural point of view, that has a huge, huge upside for this province. I think we have barely scratched the surface of agriculture in the Peace and northern B.C.

From our point of view, we want to make sure that it's done well, that it's done right and that when it's disrupted, that destruction is put back and there are those forward thoughts put in place.

If it's going to be delegated, then we've got to make sure that we've got the resources to make sure those delegation agreements are actually working. It is my observation that we've made the delegation, but I'm not sure our oversight is as robust as it should be.
[ Page 366 ]

R. Sultan: Thank you. A second question, if I may. First Nations and treaty negotiations and agreements with the aboriginal people. How are they affected by the ALR, and does ALR have jurisdiction over those lands?

B. Underhill: The commission doesn't have jurisdiction over, certainly, existing Indian reserves, for example. There's no jurisdiction there.

[1305]

When it comes to treaty negotiations, the commission would be working with the ministry responsible for treaty settlements and whatnot, so we would be feeding information to the ministry responsible for those negotiations.

R. Sultan: I take it from your answer that on an ongoing basis for treaties that are negotiated, as opposed to the Indian reserves which already exist, there is no automatic jurisdiction at all. Is that true?

B. Underhill: No. Our experience has been that as the treaties are settled and we identify the treaty settlement lands and if they are…. The act has been modernized to deal with treaty settlement lands that would be remaining in the agricultural land reserve. For example, through a negotiation which the commission is not directly working with but is working behind the scenes with the Ministry of Aboriginal Affairs, if the remaining lands, say, at the end of a treaty settlement are in the reserve, then the act is equipped to deal with those in terms of jurisdiction.

If the interests of First Nations are established with respect to treaty settlement lands, then they become subject to the jurisdiction of the commission, in a similar manner to any other lands that are owned by private individuals.

R. Sultan: I'll turn further questions over to Vicki.

B. Ralston (Chair): Well, just before that, members may recall, as well, that the Auditor General did do a report on the Oil and Gas Commission, with this issue that Mr. Bullock raised about abandoned wells and setting aside sufficient money for cleanup in the long term. It was addressed in this. We've considered that to some degree here at this committee.

J. Les: Clearly, resources and the amount of work that needs to be done are kind of related to each other. The Land Commission has been in place now for going on 40 years, and there's still this tremendous volume of work — pretty much, I would suspect, the same type of work that the commission has been doing for 40 years — handling an awful lot of applications for exclusion and the like. I guess if you keep doing the same things you've always done, you'll keep getting the results you've always gotten.

It's been my view…. I've been looking at this for a long time — obviously, from the municipal side of the table. We simply have never got to a place in this province where there has been an agreement between the Land Commission and the various municipal jurisdictions on a rationalized agricultural land reserve boundary.

The agricultural land reserve was rather arbitrarily, and necessarily so, imposed at the end of 1972. There was always this commitment — at least, many of us felt there was a commitment — to come back and to see whether those boundaries made sense, given a lot of other community criteria taken into consideration. That, essentially, has never happened. There has been a lot of piecemeal work done, virtually by one application at a time.

My submission is that there could be a remarkable reduction in the flow of applications to the Agricultural Land Commission and a resultant clearer definition of that hard edge that we were talking about before if that rationalization process would once happen.

It's certainly been one of my frustrations previously, in municipal office, that that process never seemed to happen. We ended up with a succession of poor results as a result of that, and now the commission to this day is saying: "We've got so much work to do." Well, I think those things are all related. We really have to one day have that discussion as to what the ultimate boundaries are going to look like, what communities can agree to.

There are issues other than simply just the quality of the land. If you've got a piece of fine agricultural land but there are water, sewer, expensive roads, sidewalks and all of those kinds of things servicing that land, the community is in many cases going to say: "Well, it's fine agricultural land, but it happens to be in a location where it just doesn't make sense."

I think that discussion has got to happen so that we can rationalize it. I think that if you go through that process, then you'll get community buy-in. That hard edge should be where it's proposed to be, and you'll get respect for it as well. I don't think that respect-building process has ever happened.

[1310]

R. Bullock: I couldn't agree more.

B. Ralston (Chair): Okay. Great. I like these answers.

K. Corrigan: I wanted to talk about some of the points made on page 16. It was pointed out that the commission has identified a number of additional cost-effective tools that would enhance its compliance and enforcement activities, including giving the staff the ability to obtain evidence directly, issue tickets and fines, and encumber a property title if a fine is unpaid or an order unfilled.
[ Page 367 ]

Further down: "The commission also believes that if the Agricultural Land Commission Act gave local government employees the ability to use the commission's enforcement provisions…it would help facilitate potential partnerships and improve compliance and enforcement effectiveness."

It sounds like some of the efficiencies and smoother operations of the organization, certainly in this area, could be improved if these changes were made. I'm wondering: has the commission made the request to government for the necessary changes to the Agricultural Land Commission Act in order that these enforcement tools could be put in place?

B. Underhill: No, not yet.

K. Corrigan: Okay. I'm wondering why not. It's very clear about all these things that could happen. They were identified by the commission, not by the Auditor General — correct?

B. Underhill: Yes.

K. Corrigan: Is it recently that these tools, the identification of these tools…? Has it been recently that they've been identified?

B. Underhill: Yes, in the last two years or less.

K. Corrigan: I see. Okay. Do you foresee that government will be asked to make the changes so that some efficiency can be gained here?

B. Underhill: That's our plan, yes.

K. Corrigan: That's great. Thank you very much. I have more questions, but I'm willing to wait if somebody else wants to ask in between.

B. Ralston (Chair): There's a list.

R. Lee: Some of the lands are classified in the ALR, but some of the small pockets are not one piece. They are pockets. Actually, some of the lands can be used for greenhouses. But I don't think greenhouses are classified as agricultural land. Even if it's not…. I mean, it's farmable.

Interjection.

R. Lee: Unfortunately not, yeah.

Are there any plans to — I don't know philosophically how to — say, move some of the lands which probably are inside a city or whatever to a certain area so that you can get one piece of land that's bigger?

You may get 10 percent of the land in B.C. to be suitable for greenhouse farming — right? — that kind of thing. So expand the concept of agriculture. Ultimately, it's producing food for our population. In the long term are there any thoughts to expand the concept of agriculture and utilize the land more efficiently in certain areas? I think that's my question.

R. Bullock: I'd say very much so. What you're suggesting and what Mr. Les is suggesting is that we've got to have a real rationalization of what we do. One of the things that have become perfectly clear to me is that just using the 1-to-7 CLI ratings in terms of classifying land as to whether it's useful or not is probably not the right way to go.

I think, if it would be up to me, that we've got to throw suitability in there as well. Do we actually need to put greenhouses on good dirt? We've got the dirt industries, and then we've got the agro-industrial industries. Should processing plants be on agricultural lands, or should they be moved to industrial areas? That's a whole question that I wish we could get to.

[1315]

I think this whole report has said that we're so stuck in dealing with what Mr. Les has said — all these 40,000 individual applications that we've dealt with over the last number of years — that we haven't got to these kinds of questions to be able to bring all the stakeholders in that have to have a good discussion on that.

From where I sit, I think what you're suggesting is exactly where the ALC has to go. Maybe the ALC has to be the conduit around where these discussions finally come to a head. Some people are suggesting that in some parts of the province we've probably got more land on roofs of some of our buildings that could be used if we want to be creative. It's imagining beyond the box, which I think you're trying to say. I think, from where I sit, that's where we have to get to.

That's why I suggest — and I think Mr. Les is dead right — we've got to get away from the individual application process that we've done forever and ever and get on to these other things. Set those hard boundaries, so we're probably reducing our applications by maybe more than half and getting on to these very productive ideas such as you're laying on the table.

V. Huntington: I'm pleased you brought that up. I wasn't going to bring that up because I didn't think it was in the purview of the Land Commission. I thought it was an Agriculture Ministry issue, within their legislation. Certainly, the issue of non-soil-based agriculture on prime land I think is one that has to be dealt with. To the extent that the commission can start to pressure the ministry to look at that issue and take a hard stand on it…. They won't.

The stakeholders are those individuals who want to build the greenhouses or want to build the other non-soil-based agricultural operations, all of which are legal
[ Page 368 ]
under the present legislation. It's like the definition of "soil" — anything from the mantle up, which is why you see boulders being deposited on class 1 agricultural land just to fill it. There are some real problems that the ministry needs to be pushed on, because the stakeholders themselves have a stake in leaving it as it is.

I am extremely concerned about that, because at the time the greenhouses were developing in Delta, we tried desperately to negotiate with the greenhouse owners to move onto the lower-classified land. We said we would service it for them. We would put lighting in. We would put sewer in, which we do not do in the agricultural areas, because it promotes pressure for development once you put the sewer lines in. So policy in Delta has always been no, we won't extend sewer into the agricultural area.

We said we would do anything they wanted if they moved out into the lower-classified areas, but they didn't. For whatever reason, they wouldn't go that route. So it's going to take a hand…. And the ministry absolutely supported them.

I know I have to get to a question here. But the ministry needs to be pushed in a direction. I don't know who else can do it, unless it's an independent body — sort of independent — like the commission. There are some real problems out there that the commission could be enormously helpful in.

One of the issues that's constantly mentioned here is working with local governments in their land use planning exercises. Do you know how you would reform the way it's done presently? It isn't terribly successful now.

I'll give an example. This was a number of years ago, when we were doing a whole community area plan. We went to the Land Commission and said: "Okay, what do we need to do here that satisfies you, that satisfies Delta's desire to preserve this land?" One of the things that came up was consolidating parcels — a tough, tough thing to do. The Land Commission said: "We would like you to consolidate the parcels."

All holy heck broke loose, of course, and who's the fastest one to back away but the Land Commission, so there was no support there to go through with these issues that would have helped preserve the land.

I guess my advice is that, as you look at working with local governments, you really do determine what you want to accomplish through their area plans and community plans, because that's where it can start. It needs the firm backing, which has never been there.

My goodness, I could go on. So many details.

B. Ralston (Chair): Yes, that's apparent.

[1320]

V. Huntington: Yes, I know. Not fair.

All right, I'll stand down right now.

G. Gentner: Thank you for your indulgence.

First of all, to Ralph, for his compliments relative to a former government. I'd like to thank you, Ralph. I think you represent a community that's never taken any land out of the agricultural land reserve. That's kudos to you.

I want to delve into what Kathy was on about, and that is compliance. The money…. We've seen the decreased funding.

Mr. Bullock, I know you talked about it briefly, but the monitoring, operating side of the ALR, of the commission, is something that's got to be dealt with.

We see the violations in Delta, for example — the landfilling that continuously goes on and on and on. I'm wondering: are there hard statistics relative to the increase of offending parties? I want to know the costs of appeal. How many have been dropped because of funding shortages?

Also, do you make any recommendations to the Solicitor General or the municipalities of instances or charges that violate their own agricultural bylaws? Are you monitoring that, or is it just something that's so far beyond your ability that it's not even part of your mandate?

R. Bullock: I'm not sure where to start with this, because it's a huge issue. We've been given, in 2007, the monitoring, enforcement, and while you have it…. I'm not doing anything more than giving you an observation. If you're going to be given a job, you'd better be given the tools to do it, or don't be given the job.

I don't know if I should say any more than that, because it's pretty obvious. We need some tools to get the job done. I don't think we have to be out there doing much more than begin to make some examples.

Since I've been chair, I've now said to my two little staff people: "Find me some issues. Let's go forward and track them down. If we have to take them to the end result…. That end result is generally the courts, because generally, when people tell you to go fly a kite, they're also going to tell you that they'll go as far as they can.

We're doing that, but having said that, we need some more resources to do the job properly. I don't think people have understood that agricultural land, in some cases, is actually there to be used as agricultural land rather than a parking lot for 18-wheelers plus a garbage-dumping ground, as the pictures were before you.

Agricultural land has become a convenient tool for all sorts of people to do all sorts of things. This is where I wish I could get into what I would like to say and what we're talking about. I think if we're going to be serious about this, we've got to take a piece of legislation that, in my view, is probably a leader in the world and take it out of the 40 years we've been from and move 40 years from now.

That's now putting it in place and making it an unquestionable piece of our legislation, an unquestionable
[ Page 369 ]
piece of this province and looking at agricultural land as being one of the finest resources we've got, not only in terms of land but in terms of all the economics that go along with it and all the rural communities and all the communities that count on agriculture.

I don't want to give you a speech, because you are all better at that than I am, but I think the question you ask is one of actually giving us the tools and turning us loose and being serious. We're also going to have to get some backup from all of you sitting around this table. I look all of you in the eye and say that if we're going to do that and you're asking us to do the job, I want you to be there when the people that we're jumping on are going to come and say: "Look at what these people are doing."

We've got a lot of land out there that is being abused. In my opinion, it is being taken out of one of the finest industrial complexes we've got in this province, and that's agriculture.

[1325]

The other one about land and suitability. Don't just look at the numbers. We've developed a tree fruit and grape industry in the Okanagan in this province that probably, if you looked at it…. It is done with 4-to-6 land that people are coming to us and saying they can't do anything with. Now, if you want, at the end of this I'll give you a whole bunch of wines that come from that kind of land that are excellent.

B. Ralston (Chair): You really are lobbying hard.

R. Bullock: It's a piece of legislation, Mr. Chairman, that I believe is an excellent piece of legislation in this province.

B. Ralston (Chair): Did you have a follow-up, Guy?

G. Gentner: No. I'd just like to thank you for your indulgence. I know you're doing the good work out there and wish you all the best.

J. Rustad: Thank you very much for the work you do. Two questions, I guess. First of all, I'm just wondering — I believe you have a little bit of experience outside of B.C. in terms of agriculture — about other jurisdictions that may have an agricultural land reserve or something similar and how they handle that.

The other question that I wanted to raise, which is perhaps a little more challenging to answer, is…. We've talked a lot about things in the Lower Mainland, and we've talked a lot about things in the Okanagan, here on the Island. Up in the Peace country, where half of the land reserve resides — or north of Williams Lake, I should say — and throughout that area some of the realities on the land are quite different compared to being able to grow grapes and other types of industries in other areas of the province.

I'm just wondering whether or not there should be regional recognition as part of policy for the agricultural land reserve through the ALC — whether or not the same types of policies should be in place for the Delta area versus the southern half of Vancouver Island versus the Okanagan versus the northern two-thirds of the province and even within subregions of that and whether or not it's practical to have a single policy that tries to reflect all of that or whether there should be, perhaps, some differences in the approach to how that is handled.

R. Bullock: I guess we could go on forever. I don't have enough time for that here, but I think we need a single overarching legislation. Within that we have different regions in this province that have to be dealt with differently. That's where I would go if I was recommending to anyone — that we have a good look at these regions, that we look at what is suitable for what. That's where the suitability comes in with the CLI operations. And work with the regional districts, and work with the municipalities as well as the people on the land up there to decide what's useful and what's good.

Trying to separate…. You know better than I. In trying to put in different pieces of legislation for different parts of this province, the one thing that comes up, to me, is: "Why them and not me here in the Fraser Valley?" We can separate these regions much easier if we do what we're doing now. Get away from all these applications, and get to look at the overarching principles and the needs in those areas.

The one thing, I caution you, is that when you look at agricultural land, be careful not to look at the situation as you see it on the ground today. That's one thing that I've noticed in my short tenure here. Everybody that comes before the ALC comes before with their needs today and is not looking at the needs down the road and what they can be or what they should be.

I guess that if we put that in the context as well, I think we can handle the issue you're saying within the legislation we have today, but we do have to deal with these regions differently. Delegating our authority, I think, is something that's…. It may have been a good thought because we didn't have the resources to do the job, so we were giving somebody else that task. I'm not sure that's the best way to be looking after this valuable resource.

J. Rustad: Sorry. If I may, just to the first part of the question, which was around other jurisdictions and how they handle issues such as agricultural land.

[1330]

R. Bullock: I've been very fortunate to travel and work in agriculture around the world. Frankly, B.C.'s legislation is one that is coming to the forefront. We have entertained delegations from China, from South
[ Page 370 ]
Africa, from Chile — from a number of very interested and concerned agricultural areas.

California, although we believe it's a Wild West down there, has got legislation in place that makes ours pale by comparison. Theirs is much more along the lines of what Mr. Les was suggesting: you deal with municipalities, and when you're going to remove land for the public good, it's done after a long, long process.

I think we're in the forefront. Having said that, I'm not sure others have gone to the system we have, but others certainly are going to the principle.

J. Doyle: I just wanted to add to that, Chair. We have visiting the office on Thursday the Chinese National Audit Office, and they're coming to look at this report and to discuss how this report went and the system within B.C. So there's a lot of interest out there.

B. Ralston (Chair): It certainly does give it a different dimension — doesn't it?

I don't see any other questions, so thank you very much, Mr. Bullock and Mr. Underhill.

If we could recess for five minutes, and then we'll reconvene with the next and final report.

The committee recessed from 1:32 p.m. to 1:38 p.m.

[B. Ralston in the chair.]

B. Ralston (Chair): The next report is report No. 3, Conservation of Ecological Integrity in B.C. Parks and Protected Areas. From the office of the Auditor General we have Mr. Doyle, who is Auditor General, and Morris Sydor, who is assistant Auditor General, and responding on behalf of the Ministry is Scott Benton, who is the acting assistant deputy minister, environmental sustainability division, Ministry of Environment, and Brian Bawtinheimer, director, parks planning and management branch, Ministry of Environment.

I'll turn it over to you, Mr. Doyle, and we'll begin.

Auditor General Report:
Conservation of Ecological Integrity
in B.C. Parks and Protected Areas

J. Doyle: Thank you, Chair.

Ecological integrity of parks and protected areas is important to the quality of life in B.C. These areas regulate our climate, purify the water, protect B.C.'s biodiversity and preserve some of the last remnants of wilderness in North America.

We found that the ministry has a vision to create the best park system in the world and the goal to be recognized for its leadership in the proactive stewardship of ecological integrity, but it does not have the plans to do so.

B.C. Parks will celebrate their 100th anniversary in 2011. Taking action now ensures the ecological integrity of parks for future generations. Commitment by ministry staff to address the issues identified is admirable. I look forward to seeing what progress will be made in the future.

The audit team consisted of Morris Sydor, the assistant Auditor General, who will go through the slides in a moment, and Ardice Todosichuk, who also assisted in this particular audit. I'll now turn it over to Morris to go through the presentation.

[1340]

M. Sydor: Good afternoon, Chair and committee members. As John indicated, the purpose of this audit was to assess whether ecological integrity is being conserved in B.C.'s parks and protected areas.

We set out to answer three questions in this audit. First, does the ministry have a vision, plans and operational policies for the conservation of ecological integrity? Second, is the ministry conserving ecological integrity? And lastly, is the ministry reporting on the state of ecological integrity?

As to the first question, we found that the ministry had a clear vision, but its plans were incomplete. There is a B.C. Parks program planned, covering the years 2007 to 2012, but ecological integrity is not defined; nor are there any indicators of performance measures for ecological integrity.

There has been a conservation program since 1997. Conservation policies were established then but have not been upheld consistently. For example, 44 percent of the plans we examined lacked objectives for monitoring, inventorying and research. The conservation strategy has been documented but has been in draft form since 2008, and we found that procedural guidelines are not yet in place.

Now, the parks system has developed over the past hundred years with various objectives at varying times, ranging from tourism and recreation to, now, ecological integrity. So today some areas of B.C. are under-represented, and many parks and ecological reserves are too small to maintain ecological integrity. Connectivity — that is, the linkages between protected areas — is also an issue.

On the second question, the ministry is not ensuring that ecological integrity is being maintained. We found that inventory information is incomplete, and no strategy is in place to address this. The result is a lack of important information on species, ecosystems and ecological processes.

Now, three levels of plans are provided for: management plans, management direction statements and purpose statements. The policy calls for all parks to have either a management plan or a management purpose statement in place. We found that more than half of the
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parks and ecological reserves have purpose statements or no plan at all.

Annual management planning was not carried out in each region. Where plans were created, little progress was being made. There was also a lack of regular monitoring and evaluation of conservation efforts.

As to the third question, we found that B.C. Parks prepares a parks year-end report. Now, that report focuses on recreation and provides no information on ecological integrity. As noted earlier, the ministry has no performance measures for ecological integrity.

During our review we noted that the federal government reports periodically on ecological integrity of its parks and that Ontario legislation calls for reports every five years on the health of protected areas.

In our report we had seven recommendations. The first three addressed issues related to strategies and plans; recommendations (4), (5) and (6) addressed issues related to conserving ecological integrity; and the last recommendation addressed the need for improved reporting.

That concludes our presentation, Chair.

B. Ralston (Chair): Thank you. I'll turn it over to Mr. Benton and Mr. Bawtinheimer.

Welcome, and go ahead.

B. Bawtinheimer: Thank you, and thanks to the Chair and the committee. I'm going to quickly walk the committee through the seven recommendations and the ministry response on each of those.

The first key finding was that the ministry update its B.C. Parks program plan so that it includes classification of ecological integrity and performance targets that adequately address the ministry's goal of proactive stewardship of ecological integrity. Our response is that the definition of ecological integrity and its context for management will be added to our strategic program plan. That's being updated right now.

The program plan will also clarify where ecological integrity drives management decisions. As you know, we have quite a varied provincial parks system in British Columbia, ranging from manicured lawns at Peace Portal all the way up to very large areas of wilderness. We will also be reviewing performance measures and refining those to a final state. Our target date for completion of that is spring 2011.

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The second recommendation was that the ministry complete the strategic direction and procedural guidelines for its conservation management program, which is our policy framework, and ensure that the conservation program policies are consistently upheld.

We do have a set of conservation policies. It's a three-part framework that includes strategic direction, the policy statements themselves and procedural guidelines. Those were originally done in 1997, and they've slowly been worked on and updated since then, but they are out of date.

Our commitment has been to uphold this, to update the policies by the end of 2011-12, to develop the piece within that framework around strategic direction for ecological integrity and conservation management, and to develop and update the procedural guidelines within. Our target dates are March 2012 for the end of this, and the procedural guidelines will be an ongoing part of the framework process.

The third recommendation is around government developing a plan to address current gaps in the parks and protected areas system. This one is essentially beyond B.C. Parks's ability to address on its own. This is about broader land use planning and broader government direction around setting targets for protected areas in total.

Our piece on this, though…. Our response will be centred around the land acquisition program that we do have, and we will be ensuring that the criteria for land acquisition related to ecological representation are maintained or enhanced. So our target date to set that is fall 2011. Our framework for identifying those lands will be updated by then.

The fourth recommendation is that the ministry obtain the information it needs in order to determine management actions for the conservation of ecological integrity and ensure that the policy of developing a five-year conservation management activities plan, which includes research, inventory and monitoring, is met.

This recommendation relates to a specific policy in one of the specific sections of our conservation management framework. And I would like to add at this point in time that the difference in the protected areas system between 1997, when this was developed, and today is remarkably different.

The system is now over 13 million hectares in size. Over 14 percent of British Columbia is protected — almost a thousand protected areas. So the notion of being able to have full suites of research, inventory and monitoring programs in place is a very difficult one to do.

Our approach here in this time frame now is to use a more risk-based management process. So we have tools in place to help us with this — mainly the conservation risk assessment and our annual management planning process — and we will be undertaking staff training for the use of our conservation risk assessment, CRA, tool.

We'll be updating the policies related to that, and we're starting a new program called citizen science monitoring, which is moving into a program of being able to utilize some of our partners in protected area management. It includes some of our naturalists clubs. It includes our staff on the ground and other interested community partners to help with the monitoring within parks and protected areas in a user-friendly, non-scientific, non-detailed scientific approach, one that is more
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user-friendly and takes advantage of the partners that we have working with us.

The completion dates around that are that CRA training will be completed by August 2011 and further conservation risk assessment and policy work by March 2012.

The fifth recommendation is that the ministry will review its master plan policy and clarify what type of management plan is required for each park and protected area and how ecological integrity for each area will be conserved and when the plan should be reviewed and updated.

The management planning policy updates, including the shift from prescriptive — which has been the traditional way that we've done management plans — to more outcome-based plans, will be completed by March 2012. Again, the challenge that the agency has is that with almost 1,000 protected areas in the system, having full-scale management plans for each of those is a challenging task.

Recommendation 6 is that the ministry conduct annual planning for each park and protected area to determine what actions are needed to address conservation objectives, threats and stressors, and determine priorities from this plan and monitor and evaluate the action items against our conservation objectives.

The work on this is ongoing right now. We are revising our annual management planning process, and we are aiming to have this delivered consistently across the province. The process will be updated by March 2011, and we'll be implementing this fully by '11-12 fiscal year.

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Finally, the last recommendation was around the ministry reporting periodically to the Legislative Assembly and the public on how it's conserving ecological integrity in the province's parks and protected areas system.

Our response is that comprehensive reporting will be done across program areas. It includes the annual report and comprehensive information on measurable program outcomes.

In fact, this year is the first year, if you look on our website, you'll be able to see our annual report from this year. It includes a number of conservation management activities, such as our work around mountain pine beetle–impacted trees and hazard trees, our invasive plant program, our approach around funding projects to do with cultural values assessment, the number of plans that have been approved, the number of projects completed, our new designations, and other types of information around conservation management.

We'll be continuing to update that report and improve it as years go by.

B. Ralston (Chair): Thanks very much.

Questions?

S. Chandra Herbert: Thank you for the presentation. I know there are always challenges with budget. There's discussion about working with voluntary groups, naturalist clubs. The question I had was: what kind of percentage of the park system do you think that would be able to serve, given the huge need there is to protect ecological integrity and do the conservation work? I'm just wondering, in terms of the scope of the challenge, what sort of percentage that would actually be able to address.

B. Bawtinheimer: In terms of percentages, it's a difficult one to answer. The system ranges from large, intact ecosystems — some areas close to or over a million hectares in size — areas that, on their own, will be able to respond to climate change and impacts from a changing environment over time…. But there are also other areas that are a little closer to home.

I'll give you an example from this last year. In the Okanagan, Kalamaka Lake Park is one that has a number of challenges associated with it, in terms of species at risk. It has challenges around invasive weed management. It's also a very popular park.

With 20 million visitors a year in our park system, it's always that need to be able to manage for both outstanding recreation as well as conservation outcomes around these areas.

We find that in some of these areas that are close to communities and close to areas that have groups that are willing to step in and assist us with that, work has been very encouraging. Our program, moving forward, will be trying to harness even more of that. It helps make the park system much more relevant to the public as well.

So we're looking for those opportunities. I don't know what the percentage might be, in terms of that, but clearly what we're trying to find is those linkages between those groups that are willing to help us, in terms of management and monitoring around some of this, and our management direction over the long term.

S. Chandra Herbert: Just as a follow-up. I know in my own community, Stanley Park…. Of course, it's not one of the parks that we're talking about today. We've got a great group, the Stanley Park Ecology Society, which looks out for the ecological integrity of the park, through a huge number of volunteers. So it can be a really good thing and teach people about the natural environment as well.

Given that a number of the parks are in places that may have smaller communities or may be places without a lot of folks who might be able to volunteer or what have you, how likely is it that we're going to be able to address these challenges, say, in the next year? Or is this just that we're going to try and chip away at the margins of this, but in the end, because of the budget challenges, it's just not possible?
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I'm wondering if you can speak about that.

S. Benton: You're quite right in your example. Stanley Park is a good one. Stanley Park is near a large urban centre. If you think about, from a park management perspective, where a lot of the threats come from, most of it's human-related. Therefore, the places — provincial parks that surround Metro Vancouver and in the Okanagan, some places in the Kootenays and the Thompson region…. That's where, largely, the province's population is centred. So one of the greatest threats is from that.

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In those places there are groups like you're talking about that are willing to step up, and there are adequate numbers. We are busy revamping the partnership program within B.C. Parks at this time so that we can step up to the challenge. We will never get 100 percent of the system covered — there's not a chance — nor do we think it's necessary.

The parks that we've got today, starting out with Strathcona, a hundred years in existence…. Many of the large protected areas in the north have, from a human standpoint, very low pressures. Other types of pressures are growing, and we need to step up to that.

The citizen-based science and monitoring groups are just one of the notions that we've got to step up to that. We've had interest from some industry sectors. They are looking at contributing to that.

We have one example in the Valemount area, Mount Robson, where I think it was…. It had to do with a pipeline expansion going through Mount Robson Park. They created an endowment just so that we could run programs going forward. That endowment is specifically targeted around ecological integrity and keeping the ecological plan that's in place for that park up to speed and providing project funding. It's not just one initiative; it's multiple initiatives.

J. McIntyre: My questions are directed to the Auditor General's office.

I was just curious about how you conduct this kind of audit. I understand and know that your office has auditors and accountants. I understand how you can go out and audit ministries and balance sheets and all the good work that you do. But I was just very intrigued by the questions you set out here.

Question 2: "Is the ministry ensuring that ecological integrity is being conserved in the province's class A parks and ecological reserves?" I'm just sort of baffled by how that happens. There's just a very brief description on page 16 of the methodology.

Do accountants go out and measure this, and how would they do that? Do you subcontract this to experts? If so, why would that not be elaborated on in the methodology? I have no idea how you would conduct such an audit.

J. Doyle: Your assumption is that the Office of the Auditor General consists entirely of accountants. I can assure you that it doesn't. The young lady that was responsible for this audit is well qualified in this particular area, has a master's degree and is more than capable of discussing all the topics and issues associated with ecological integrity.

Her support staff were similarly not accountants and were able to discuss at a peer-to-peer level the scientific method that was being considered and also the impacts on the environment.

Let me please assure you that, in fact, we did take care to choose the right team, and the team that we chose was talented in this particular area.

J. McIntyre: And all employees? I mean, they are employees of your office, or do you subcontract some of this type of work?

J. Doyle: These were employees of the office who had been recruited and then allocated to a particular area within the performance audit practice in looking at the environment and sustainability. In this particular case they had more than adequate qualifications in this area.

J. McIntyre: I was just curious. I was not casting aspersions or anything. It's just not the typical audit, I guess. I didn't know how all of this worked. Maybe it is a typical audit, and I'm just showing my….

B. Ralston (Chair): Perhaps, Mr. Doyle, it might be useful just to expand a little bit on the difference between a performance audit and a financial audit and the degree to which your office does performance audits. That is a topic of ongoing discussion, I guess, amongst Auditors General offices across the country.

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J. Doyle: Okay. We have a strong mandate within this province. Under that mandate the primary focus of the office could be said to be financial audit, which is expressing an opinion on the state of the financial reports that are actually produced by entities within the government reporting entity.

Associated with that are things like governance, control frameworks, IT controls, fraud, etc. Typically, you'd expect accountants or accountants that have been trained in certain specialisms to be able to deal with all of that work, and indeed, that's how we staff up that side of our practice.

The other side of the practice which is contained within the legislation is looking at performance audit. That looks at economy, efficiency and effectiveness. The effectiveness component is the critical one. That's the outcomes focus. That allows us to look at any government program that is in place within government and to look at it carefully and to say whether or not
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the outcomes that are flowing from that are what's expected and whether or not they're trying to achieve the objectives.

Now, we're not allowed to talk about policy, so we don't have a comment on whether or not the parks system should look after ecological integrity. What we do is say: "Well, the parks system has as their stated aim that they're going to look after ecological integrity, and that's fine." But we couldn't recommend, for example, that they do, but because they already have, we can comment on how well they do it.

Typically, it is not accountants that do that performance audit work. There are some accountants in that group. For example, Morris, next to me, is a CA and has been for some considerable time, but not all the staff within that particular area are accountants. They come from lots of different areas. We've got lawyers. In the past we've had nurses, teachers, scientists. The base qualification to get into that particular area is usually a master's degree in some area that's relevant to the office.

Occasionally we bring in more junior staff, but if we do, then they've got bachelor's degrees. We train them up in how to conduct performance audits, and we're leaders in developing a performance audit curriculum across the country. We're just changing all our performance manuals and processes and so on at the moment. As a consequence of that, we've got a very strong and vibrant performance audit community that actually sits down and goes through all of these areas.

If we come up with a topic that needs to be done and we don't have the skills…. For example, we did a report recently on seismic safety. Nobody in the office had any idea about the engineering that's associated with earthquakes. We were able to access that expertise from experts in the field.

In the same way, when we did work on surgical services, we actually asked a surgeon and also a senior nurse to be part of our advisory panel to give us advice as to what we should be looking at and what questions we should ask and then also to be clear about interpreting the results of our investigations.

I trust that helps.

B. Ralston (Chair): It does, I think.

K. Corrigan: I'm very concerned about some of the findings and comments on page 22 with regard to the threats and stressors to the biodiversity in class A parks and ecological reserves and the fact that the ministry was not adequately addressing, for example, human use as a threat, which has been identified as the greatest threat to B.C. parks. Yet at the same time, the interpretation program has been eliminated.

Invasive species as a threat. Ninety-eight percent of the lands contained invasive plants, more than 70 species. Yet there was no evidence of a long-term plan outlining a consistent approach to address invasive species.

Adjacent land use activities as a threat. Mining, logging, land development activities and others are eroding the ecological integrity of the lands.

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The opinion of regional staff that was interviewed was that this lack of progress in addressing threats and undertaking conservation projects was due to the lack of resources and expertise. It sounds like there are some real threats that have been identified in this report.

It concerns me that the only response from government is that B.C. Parks will revise the annual management plan process using best practices by the end of 2011-2012. The response, while it is progress, it seems to me is not detailed enough and doesn't seem to put enough effort into addressing the very real concerns that have been identified by the Auditor General.

I'm wondering if government has a further comment on that area.

S. Benton: A couple of thoughts, and then Brian may want to hit on some specifics.

In terms of the human threat piece, when you have a system that's over 13 million hectares that's protected right now, less than 2 percent of that land base is developed for human use. So that means 98-plus percent is largely in its natural state if that's the way it came into the system.

So it's acknowledged that humans present the greatest risk, but that's if they're in those environments to create the risk. The reason why we develop areas is to mitigate the risk — to contain human use, particularly in high-use areas, within very concentrated areas. That leaves the rest of the protected area and the protected area system to evolve naturally the way it is.

I don't want to underestimate that in some areas we've got some pressures. That's where we're focusing our effort — in those highest risk areas. That's the resourcing that we've got to deal with that.

In terms of the invasive species threat, we have an active invasive species program. What the auditors found was…. They don't find that we've got a system and an outlook for managing invasives in the parks system. That kind of speaks a little bit to MLA McIntyre's question about what it is that you're auditing.

So we don't have a written management system in place, but we do have an active invasive species program for plants. We work with the Invasive Plant Council of British Columbia, in partnership with many other local governments, to address the highest risk areas, many of which are in the southern part of the province. In fact, in the last two years we've spent more on invasives, using partnership dollars, than we have ever before. So that's been successful for us, but we do need to document what we're doing and where we're going with that.
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The adjacent land use activities threat that's been there as the province becomes more accessible through road networks…. We do work on a project-by-project basis with proponents, whether it be logging plans or other industrial development or community development, on what the interface looks like. We always represent what the interests and objectives of that park are and seek the cooperation of our neighbours to make sure that they're sensitive to the development.

Does it always work? No. Do we always step up to try and mitigate that where we're aware of it? We do.

Brian, I don't know if you want to add anything to my comments.

B. Bawtinheimer: I would just add one other important part, I think, of park management that's not often thought about in the conservation aspect, which is our facilities management program. B.C. Parks currently manages over $600 million worth of facilities throughout the parks system. We often think of those as trails and bridges and things that we often will categorize as recreational use. In reality, they're just as much about conservation use.

When we talk about how visitors visit our parks in an appropriate manner, being able to provide some of those facilities in a way that controls use, that doesn't spread out the impact and is able to contain that in a way that provides both a quality experience and the protection of important conservation values, is quite important.

So that's been a big part of how we've managed as well.

B. Ralston (Chair): Follow-up?

K. Corrigan: Yes, unless you've got other people waiting.

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B. Ralston (Chair): I have John Les.

K. Corrigan: Oh, it's just Mr. Les.

Interjections.

B. Ralston (Chair): Now, now. We were getting along so well.

K. Corrigan: I will do a quick follow-up, because it's related. I'm wondering if…. There is a quick mention of the park facility operators. I'm wondering if either the Auditor General or the ministry has evaluated how well that program is working. My recollection is that for many years this work was done in-house and now it's been contracted out.

I know we used to take our kids camping in provincial parks all the time, and we got the sense that when this work was contracted out — perhaps the pressures to make a profit and make a go of these parks — that perhaps the level of service went down.

I know that's not specifically talking about ecological conservation, but I think that's part of the work that is done. I'm just wondering if the government or the Auditor General has any comment on that aspect.

S. Benton: So we did conduct an effectiveness audit. It was internal, but we used an outside company to do that.

On that program — I believe it was two years ago, Brian, or three…?

B. Bawtinheimer: Approximately two.

S. Benton: What that audit looked at was whether the model that we chose in 2002 was delivering on expected results, which was financial savings, trying to ensure that the operators had the proper authorities to deliver on their end of the business and whether we thought that the model was achieving the results we set out to achieve.

What we learned from that is that overall the model was working, but there were some needed improvements both on the administrative side from the contractor-government relationship as well as changing some of the contracted conditions to allow the operators to work more effectively.

In terms of contractors' role in conservation, Parks has been contracting service delivery for recreational services since about 1983. So it's not a new concept in park management.

There's no question that British Columbia uses that delivery tool more than any other jurisdiction in North America. We've done it for cost-effectiveness reasons, but we've also used that as a means for the staff that we do have to allow them to focus on broader park management issues.

One of the things that we've been doing over the last year — in part as a result of this audit, but we were on this path anyways — is re-evaluating what our staff are doing versus what contractors are doing and making sure that our staff are spending their time on the most important places.

What we're talking about here today is one of the most important places, so we want to have staff that do spend time managing those contracts focus on that. It means other staff as we go forward to start paying greater attention on this side of the business.

J. Les: When audits are done, my assumption always is that we try to achieve as much objectivity as possible. So when we discuss concepts like ecological integrity or even the concept of ecosystems, I have not yet run into anyone who could describe to me what those things are
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in any kind of finite way given the billions, if not trillions, of critters and interactions that happen within each one of those understandings.

I guess a question to both the ministry and to the Auditor General. First of all, how do you describe what ecological integrity is? It seems to me somewhat of an impossible task — or completely impossible. To the Auditor General: how do you audit whether you have in fact achieved ecological integrity of any ecosystem?

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I couldn't begin to describe the ecosystem on the head of this microphone, and I don't think anybody could either. It's perhaps somewhat philosophical, but it's a question that often interests me when people purport, maybe spiritually, to speak about ecosystems. Yet as government we're expected to deal objectively with these things.

Over to you.

S. Benton: Well, I'll start, and then we'll throw it over and Brian will kick in. What the Auditor has pointed out to us is that it's us that set this out as an objective to achieve, but they've also pointed out that we've failed to define it, as you've noted. We need to do that.

Intuitively, I guess, we know what we meant all along, but it's pretty hard to audit that. So one of the things that we need to do in our program plan is to define what we're saying. National Parks has done that in their mandate. We need to do the same. Ours won't be the same as National Parks'. It may be similar, but it will be a made-in-B.C. definition.

In terms of how you measure it, you could get a microbiologist to tell you what the ecosystem is on the head of that microphone. We've got biologists that will tell us what the key indicators are — indicator species, indicator systems — and how they should function. Then what you do is go and look for those places in the province — they're all mapped at a very high level — and then you get down to the forest level. You can see the various attributes that are in those systems. If they're present, and if they're healthy and the proper mix is there, then you know you've got a properly functioning ecosystem.

I should qualify this. The provincial parks system isn't meant to save the ecological systems in British Columbia. They're one part. They're one bookend of the ecological integrity in the province that we live in and manage through an integrated resource management regime. Parks is part of that, but so are all the Crown lands outside of that.

Brian, do you want to add anything to that?

B. Bawtinheimer: Well, I think I would just add that yes, I agree with you that the concepts of ecosystem management and ecological integrity…. Those two phrases have often been interchanged, but they've evolved over time.

I recall a time when we would do conservation management through a single-species approach: how are we going to manage for a particular fish species or a particular terrestrial species? That's evolved into parks as systems of multiple components on the conservation-ecological side and trying to wrap our heads around how that looks in terms of stressors and threats and how you manage for that over a longer period of time.

Yes, what the OAG has pointed out to us is that we've adapted this language around ecological integrity and ecosystem management. We thought we knew what we were talking about, and when they looked to say, "Tell us exactly what you mean; show us the written piece around that," we realized that we didn't have a definition in place around that. So our next task is to define what we mean by that and what the expectation is of the provincial protected areas system to contribute towards that.

B. Ralston (Chair): Thank you.

Mr. Doyle, you look poised to say something.

J. Doyle: If I could just add to that. It's a very good question, because we didn't set out to determine whether the ecological integrity within the parks system was appropriate. What we did was we set out to see if the parks as an organization did what they said they were going to do, which is exactly the point that's just been raised.

This brings into focus something in performance audit, which is the difference between outcomes, which we can't measure — as I think you've just pointed out — and process, which we've identified and gone through and looked at. We can determine that there are some gaps in the process.

Now, it would be my intention that, at some time in the future when there is full reporting and all of this has been done properly and appropriately with proper resourcing and all the other caveats, we'd be able to go along and say: well, what are the outcomes over this period of stewardship? Has ecological integrity been maintained, or is it being managed in a way that makes sense, and what does that mean? But we weren't able to step into that space because at the moment the tools are not there to actually measure it. There wasn't even a definition. So it's a good question.

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If this audit had been done a while back and everyone had responded to it, maybe we could look at what ecological integrity looks like. Is it getting better or worse, or is it the same? We can't even go close to that question at the moment until such time as these tools are put into place, and I think it will take a little while for all that to occur. But it's a good observation.

You'll find in performance audits that I'm trying to get away from process, which is how things are done, and into: what's the result? What's the outcome? And the mandate that we've got in British Columbia is a good
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one. It talks about effectiveness, and it's that effectiveness piece that actually says: well, how well or not well have things played out, given the inputs to the whole process? What was the target? The target is a high bar, and I think that's gutsy from the parks perspective, but they've still got a way to go yet.

B. Ralston (Chair): Vicki, did you have a question?

V. Huntington: Yeah. I'll just ask a couple of quick ones, given that I got slapped on the wrist for the other one.

B. Ralston (Chair): I did no such thing.

V. Huntington: "Did you know you took five minutes?"

I noticed that you have committed to updating your management plan, and you are suggesting that you are going to move from a prescriptive form of plan to an outcome-based plan. Now, what does that mean, how is it going to look at the end, and what are the measurements that can be followed through as you go through this?

B. Bawtinheimer: One of the challenges in developing management direction for our protected area is…. The process, for a full-blown management plan process, usually involves bringing together a number of different stakeholders, community representatives, all with issues and interests in terms of setting management direction.

Often the issues around that can create what we've found in the past to be very detailed and specific components around how a protected area is to be managed — to a point where it essentially hinders us on a year-by-year basis by saying: we will do exactly this type of management action.

What we found is that by moving away from the prescriptive management actions into outcome-based management…. We're saying: "Here's how the protected area will contribute to an outcome related to recreation management, to visitor services, to conservation management, and these are the outcomes we are looking for." As our knowledge changes over time, as new partners come into play and different ways of looking at that, we have the ability, then, to say: "What's the best course of management to get to that particular outcome?"

Part of that, though, as you raise, is performance management. In the new policies that are being developed for management plans right now, we are also putting performance measures within those. The performance measures will relate back to the outcomes that have been prescribed in each of the management plans.

We're finding the effectiveness of that model is much better in terms of being able to reach some of our goals and objectives in ways that are often more creative. As we talked about before, our progress on involving communities and partnerships has really evolved over the last decade, and it will continue to evolve.

We need to be able to harness some of that interest and some of that energy. We want to be able to set the standards, through those management plans, of how those protected areas will be managed. That's the model that we're finding is the most effective.

V. Huntington: But isn't setting standards going to require some element of detail within that performance-based expectation? How will you guarantee that elements of ecological integrity or the protection of the ecosystem, which can be extremely scientifically based at times…? How are you going ensure that there aren't huge gaps?

If you don't have the detail in there, then it could develop over a period of a few years where everything looks fine — it's performance-based; it's looking good — but all of a sudden you've realized that X hasn't been done over a period of a few years and you've lost the advantage. How are you going to look for that and not have the Auditor say there are no criteria for assessing the performance?

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B. Bawtinheimer: In terms of the long-term potential impacts of not achieving or understanding your potential impacts for a protected area, some of these associated tools to the management plan are critical in that framework.

We mentioned in the presentation the conservation risk assessment process. That, for us, is one of the vital tools that takes us through a methodical way of reviewing what's going on in a protected area on a time frame — usually it's every year or two years, depending on the risks and threats that are available — and having staff who have knowledge around some of this and bringing in knowledge where we're able to do that from other experts from around government and other organizations to be able to help us identify what are the threats and risks around some of the values that we see and making sure that our management plans have identified those and are able to then provide management direction to best manage within that context. These tools do work together in that context.

V. Huntington: But according to this assessment in front of us, you've already fallen way behind in that regard. You've indicated that you basically are having trouble even catching up with the existing management plan. As you go forward on this whole new process, how are you going to possibly sustain it?

I don't understand. It sounds nice. It's lots of nice words. But how are you going to sustain a new process when you can't sustain the more detailed one in the past,
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which ought to have the resolutions that you needed in the first place?

B. Bawtinheimer: The approach on management planning…. I mean, the challenge that we do have is we have almost 1,000 protected areas in the province. It's an enormous system. It's the largest provincial system in Canada. It's the third-largest protected area system in North America behind the U.S. national park system and Parks Canada.

For the management regime for each of those areas, we do need to take a risk-based approach around that. The notion of being able to provide a full-fledged management plan for each one of these areas is a daunting task. It's heavy in resources, and it's heavy in the ability to deliver on that. Often some of our intense management plans can take two to three years to complete for each protected area. It is a huge task.

Based on those notions of risk management and being able to look at threats and risks and the types of information that tell us how well a protected area can be managed in terms of that risk-management approach will give us an indication of how detailed a plan we need to be able to produce for each of these areas.

There are protected areas out there that are not nearly as complex as other ones, and we don't need to have full-blown management plan direction for some of those areas. Other ones have a whole variety of potential impacts, both with visitor use and recreation management within that, within the context of things like species at risk and other areas like that.

I look at places like the Lower Mainland and the Okanagan as being examples of where we need to put in a tremendous amount of management direction, in terms of some of that, because the pressures are intense. In other parts of the province the pressures are not as intense. The plans don't need to be as complex in order to provide that direction.

V. Huntington: Mr. Chair, could I ask a couple of others on follow-up, or are there others?

B. Ralston (Chair): Okay. Keep going.

V. Huntington: How will you enforce, or do you have any mechanisms for enforcing some of these protections that you want to put in place? How do you enforce these things against even your colleagues, other ministries and their actions and plans, let alone the public? What are your enforcement mechanisms, and do you ever exercise them?

S. Benton: Are you speaking about enforcing the objectives of plans? Or just enforcing…?

V. Huntington: Well, I'm assuming that part and parcel of protecting a sensitive area has certain requirements attached to it — thou shalt nots — unless you're moving…. When you say you're moving away from prescriptives to outcome-based, how do you expect to ensure protected areas remain pristine or function properly or aren't disturbed — without prescriptive and enforcement capacity?

[1430]

S. Benton: Okay, so two different things, in my mind.

The prescriptive piece. If you look at older management plans, they detailed where signs should go, what types of buildings should be constructed, what they should look like, what standard of trails — that's when Brian is referring to prescriptive — or right down to, "You should do a list of inventories of birds and mammals, etc.," instead of saying you need a comprehensive ecological plan for this park, if the park in fact needs one.

By saying that and then indicating what the performance measures will look like in the outcome of the plan…. It says the same thing. It just takes less time to write it. And it stays relevant longer than having something that's very specific for the time that the plan was written.

To me, a management plan…. It gets around to how you ensure that parks meet their purpose over time. The key element of a management plan is: what's the purpose that that park or protected area was established for? That usually comes to us from a land use planning process. That sets the stage for us, and then the management plan process goes about saying: "Well, what are the objectives, then, for this park over time in each of the areas of park management?"

So what is it from a conservation, a land management perspective? What is it from a cultural management perspective? What is it from a recreational management perspective? Those are clearly articulated, and those rarely change over time. If they do, they do for societal reasons, and then the plan has to get revisited.

After the objectives, then there's the zoning, which says: "Where in this landscape should those various objectives apply?"

I invite you…. I'm not sure how many of the new conservancy plans, Brian, are up on the web, but many of those, particularly in the north coast, speak to the type of planning that we're talking about doing. The planners are actually able to produce more plans — still engaging with the public — in a shorter period of time using that approach, and then spending other staff time actually getting on with implementing those plans than writing great long documents that very quickly become dated.

In terms of the enforcement piece, in British Columbia the park plans are not set in legislation, and that's a philosophical argument whether they should be or shouldn't
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be. The management school that I grew up in says it's better not to, because it does allow flexibility over time. Particularly if you've got a very prescriptive plan, it very much ties a park manager's hands into trying to deliver on the objectives.

The Park Act, despite its age, is still a very strong piece of legislation. It constrains, depending on how the act is used when the park is created, the types of activities you can do on the landscape, right down to directing the minister what the mandate is for those lands and how they can be used and how they cannot be used.

I haven't seen in 26-some-odd years an issue around the disconnect between where the management plan direction has directed to go and the agency delivering on that. In terms of the other tools that we use to enforce…. Again, the regulations under the Park Act have been updated more recently. While they're not state of the art, they still provide the adequate management tools for park managers to protect the system.

[1435]

S. Chandra Herbert: Stanley Park Ecology Society recently released State of the Park Report for the Ecological Integrity of Stanley Park — Robyn Worcester. An excellent report. If you need another report to read, it's one I'd recommend.

I found it really useful for the public because you could get a sense of where we were improving, where we were maybe standing still, and where we were regressing and obviously needed work. That helped, I think, the public see where they could play a role in improving the park, improving how they use the park and lending a hand where that was possible for something like, say, English ivy and doing an ivy pull — an invasive species.

Just curious. One of the conclusions or one of the recommendations in the Auditor General's report was to find a way to make a consistent reporting of "were we improving for ecological integrity?" — those kinds of questions — more publicly available.

I'm wondering what the process is to do that, because I think, certainly with parks closer to urban environments, that would be very helpful for those volunteer groups to use to get more people involved and actually see a way forward in terms of "are we improving the ecological integrity? Are we making it safer for species at risk?" — those kinds of questions.

B. Bawtinheimer: It's an interesting question, and there are a number of pieces within the OAG report that lend themselves to that. I think about things like the performance measures and even the definition of ecological integrity.

As we report out to the public on this…. You know, going back to MLA Les's comment around how we describe what it is we're actually trying to do here, we need to think about that, in terms of a language out to the public to say, "Here's what we're striving for" within that system — providing the definition.

The next piece is around some of the performance measures. In the first recommendation we talked about the program plan and looking at those broader objectives and goals that we have within that and finishing off the work around performance measures around each of those. Moving then down to the next level, it's around the performance measurement associated with some of the management plans for each of the areas.

The challenge we're going to have is that it's much easier, for example, to develop a state of the park report for a single park. When you have a thousand it's very difficult to do. So as we move our reporting process forward, we're going to be considering what kinds of information the public is quite interested in knowing about within a system kind of context, and then being able to find the processes to be able to collect that system effectively on a basis to be able to provide that as part of our annual reporting.

We've started this year, but it's mainly been on a subject-based area. What has B.C. Parks done in terms of hazard tree and fire and fuel management, for example? What has B.C. Parks done in terms of invasive plant management? And we looked at our rates of investment versus the return and highlighted some of those.

That reporting mechanism does need to evolve over time, and we need to consider how to do that, both at perhaps a more regional level versus a provincial level.

S. Chandra Herbert: Just on, let's say…. Let's talk about invasive species for just a moment. I know it's housed in a different ministry, although it affects B.C. Parks as well, so they have to take interest, and they do.

I understand that in a number of cases, if you don't get in there and stop the spread of whatever the species is, it's going to cost you way more in the long run to deal with than if you stop it at the front end. As some of the parks outlined don't really have a plan yet to address that, I'm wondering: what is the strategy? I would hate to have to go back and tear that ivy off if it could have been stopped at the beginning.

B. Bawtinheimer: This is where some of the tools like the conservation risk assessment have been really important for us. We've gone through a couple of cycles of conservation risk assessment for protected areas, in which case while we may not have a management plan for each area, we do understand the stressors and threats and risks associated with a great number of these areas. Invasive species are probably the second most critical stressor and threat to protected areas. So we do have data that tell us where some of the highest potential is around invasive species.

We've then had a program that's worked with the Invasive Plant Council of B.C. It's been an excellent
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program because it's allowed a partnership and it's allowed for leveraging. So as we've been able to put in resources, we've probably got a two or three to one return in terms of the efforts coming back.

[1440]

We've also used the program, through things like the federal job opportunities program, to help us as well. That's been very beneficial for us, to be able to partner with others to address some of these things, but it goes back to that point of risk-based management.

It's very difficult to address all invasive species in all areas and try to identify those that are the highest risk from a number of different factors, such as early detection and control, ones that are preventing species at risk from thriving, and ones that may hinder the movement of species in a changing environment. Those sorts of criteria are applied in there to help us, and working with experts in places like the Invasive Plant Council to be able to identify where some of the highest priorities are that we can address.

R. Lee: That's a question that's relating to mine in terms of ecological integrity. Since there is a timeline…. Time is how you define a cycle. Pine beetle–killed trees can regenerate that area if that tree dies and then a new tree comes up. It's the same as a forest fire — that kind of thing.

In terms of biodiversity, the biocycle and also prey and predators — all those things — how do you define a measure of how much the system has been disturbed that it cannot be recovered? I think, in terms of measurement, my question is: ultimately, how do you define that? What kind of measure do you attach to ecological integrity? It's not a number.

S. Benton: It's a combination of numbers or indices. In an ideal world we would have a baseline measure of what everything looked like when it came into the park system. What did the forest cover look like? What did the understorey look like? What species existed there, etc.? We can measure — and we do — in new protected areas the amount of land that's disturbed versus undisturbed, and so that's one benchmark for us to work from.

Going forward in terms of measuring whether you've got an intact or a functioning ecosystem, you have to define what makes that up. What are the attributes? If it's a coastal Douglas-fir system: is there coastal Douglas fir present in the system, and what state is it in? So the age and condition — is it mature? Is it old? Is it young? What are some of the other attributes that contribute to a coastal Douglas-fir system? I'm not a biologist, so I can't tell you, but we have biologists that can.

So we look for those different attributes that are in the system and say: is the system big enough to stand on its own or not? Will it survive over time? And if it does, and those attributes are able to be maintained over time…. Sometimes we have to intervene.

We'll shift to the Kootenays, where fire has been removed out of that ecological system for a long time. It's not a properly functioning ecosystem any longer in some parts of the Kootenay region. So we are going in and removing, either through fire or mechanically, some of the forest cover to return it to its normal operating state. It's a pine grassland system. Then we look at what that should look like in terms of densities of trees and open areas. If there are components of it missing, it might mean reintroducing species, etc.

R. Lee: But what I'm saying is that a population can take care of itself if you give it enough time, but the human injection of the management…. Maybe you can help in one species, but what happens if the pine is replacing the Douglas fir? I mean, it's the same in terms of that overall area. I think we have to somehow define this measure better in terms of what you are trying to achieve in the whole system.

[1445]

I think just hand-waving and saying, "Well, we tried to introduce more diversity in a certain time period," doesn't maximize or optimize the whole system.

S. Benton: We have some examples of what ecological plans for parks…. Mount Robson is one of them. If you were to look at that on the website, it would tell you what we're trying to accomplish. I get that I'm not explaining this well enough for you, but it's all based on science — the science of ecology.

R. Lee: I would say this is an art not a science at this moment.

S. Benton: Well, park management is an art, but it involves science, and it involves incorporating human values into it.

R. Lee: Okay, thank you. I don't think I can get the answer.

B. Ralston (Chair): I don't see any further questions, so that might be the right note to conclude on.

Thank you very much for coming, Scott and Brian, and thank you to the Auditor General.

Before we adjourn, under "Any other business," Norm had a question he wished to pose to the Auditor General.

Other Business

N. Letnick: During the recent independent officers' budget submissions to the Finance Committee, there was some difference of opinion as to whether or
[ Page 381 ]
not some measure of scope creep has occurred. Since the Auditor General currently conducts finance audits of independent officers, would your office consider undertaking performance audits prior to next year's independent officers' budget submissions to provide us with an independent view as to whether they are achieving their legislated objectives effectively, economically and efficiently?

J. Doyle: If I can paraphrase the question, you want to know if I am prepared to audit the performance of independent officers?

N. Letnick: A performance audit — as in the outline as to what the Auditor General does. There are financial audits and performance audits. Actually, I just pulled that right out of the website about an hour ago, which says "effectively, economically and efficiently."

B. Ralston (Chair): Wouldn't that be the scope creep of your own office?

J. Doyle: I'm getting there, Chair.

First of all, there are two types of performance audits. One is the process, and the other is the outcomes. When it comes to independent officers, it's normal for the outcomes to be considered by a parliamentary committee.

When it comes to the processes and what have you, you will find that Auditors General across the world would be reluctant to go and have a look at a fellow statutory officer's processes. It's a bit like going in and checking up on a judge. I don't think that would go down well either.

There have been examples where there has been cross-pollination of overview between different statutory officers. For example, at the moment, the Auditor General of Canada is conducting some work on one of the other statutory officers within the federal system because there was a provision in the legislation that internal complaints would be addressed to the Auditor General. I think that report is due to come out soon. But it is the exception rather than the rule.

I am reviewed and subject to audit by my colleagues in respect to the Merit Commissioner. She can request details of any audit, any appointments that I make, and she does, quite a lot of the time. I'm subject to audit there.

I've never been subject to audits from the Ombudsman, and I can't think of a circumstance where I would be. I don't think the representative would particularly be interested in me and my office. Children and Youth — I don't get that one. Privacy — possibly. They could conduct an audit on me. I don't think the Conflict of Interest Commissioner and I don't think Police Complaint do it.

[1450]

So it's pretty limited, and it's unusual to do it. What sometimes happens with committees — this is standing committees — is that they sometimes require a performance audit or a performance review of a statutory officer. For example, the legislation in Melbourne, Victoria, requires a regular review of the Auditor General's office. That's put into place each year. There are some rules around that similar to the appointment of a financial auditor, but basically the report goes to the legislative officer. It ultimately ends up with the equivalent there of the PAC.

I've never heard of an Auditor General being requested or appointed to conduct a review, but it is within the mandate for a review to be undertaken. It's any office that's within the GRE, but it would be most unusual for that to occur.

N. Letnick: So you're saying that it would be more appropriate for a legislative committee to be struck to look at the question as to whether or not the independent officers are acting within the bounds of their legislative mandates. Or would you say that it could happen by the AG's office if requested? I'm unclear as to what you were suggesting.

J. Doyle: Under our legislation, if I'm requested by you the committee to conduct a piece of work, I have to consider it.

N. Letnick: Okay.

J. Doyle: But if you were to ask me whether or not I felt I was inside or outside my mandate, of course I would give you a fulsome report.

N. Letnick: I will consider your answer before I make any suggestions or recommendations to the committee.

B. Ralston (Chair): Okay. I think that's all the business. With that, we are adjourned.

The committee adjourned at 2:52 p.m.

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