1975 Legislative Session: 5th Session, 30th Parliament
The following electronic version is for informational purposes
The printed version remains the official version.
TUESDAY, MAY 20, 1975
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Personal Information Reporting Amendment Act, 1975 (Bill 79). Hon. Ms. Young.
Introduction and first reading— 2451
ICBC services during strike. Mr. Bennett — 2451
Effect of strike on driver documentation. Mr. Gardom — 2452
Asbestos fibre content in air at Cassiar Asbestos Corp. mine. Mr. Wallace — 2452
Mill rate limitations. Mr. Curtis — 2453
Ferry pre-boarding privileges. Mr. D.A. Anderson — 2453
Use of grants by strata corporations association. Mr. McClelland — 2454
Student employment by Mines department. Mr. Gibson — 2454
Accounting and auditing practices in tax surveyor's office. Mr. Curtis — 2454
Federal criticism on provincial handling of Indian demonstrations. Mr. Wallace — 2454
Committee of Supply: Department of the Attorney-General estimates.
Division on motion that the committee rise and report progress — 2455
Public Trustee Amendment Act, 1975 (Bill 3). Third reading — 2455
Investment Contracts Amendment Act, 1975 (Bill 4). Third reading — 2455
Real Estate Amendment Act, 1975 (Bill 9). Third reading — 2456
Fair Sales Practices Amendment Act, 1975 (Bill 10). Third reading — 2456
Securities Amendment Act, 1975 (Bill 20). Third reading — 2456
Police Amendment Act, 1975 (Bill 46). Third reading — 2456
Mortgage Brokers Amendment Act, 1975 (Bill 48). Third reading — 2456
Perpetuities Act (Bill 1). Third reading. — 2456
Administration Amendment Act, 1975 (Bill 5). Third reading — 2456
Cooperative Associations Amendment Act, 1975 (Bill 6). Third reading — 2456
Farmers' and Women's Institutes Amendment Act, 1975 (Bill 7). Committee, report and third reading — 2456
Bee Act (Bill 45). Committee stage.
On section 3. Mrs. Jordan — 2456
On section 8. Mrs. Jordan — 2457
On section 10. Mrs. Jordan — 2458
On section 29. Mrs. Jordan — 2459
Report and third reading — 2460
Farm Products Industry Improvement Amendment Act, 1975 (Bill 65). Committee stage.
On section 3. Mr. Phillips — 2460
On section 4. Mr. Phillips — 2461
On section 5. Mrs. Jordan — 2462
Report and third reading — 2466
Status of Men and Women Amendment Act (Bill 75). Committee stage.
On section 11. Mr. L.A. Williams — 2466
Report and third reading — 2467
Special Funds Appropriation Act, 1975 (Bill 23). Committee, report and third reading — 2467
British Columbia Hydro and Power Authority (1964) Amendment Act, 1975 (Bill 25). Committee stage.
On section 1. Mr. Smith — 2467
The House met at 2 p.m.
MR. W.R. BENNETT (Leader of the Opposition): Mr. Speaker, in the gallery today is Mayor Ron Andrews of the District of North Vancouver, a gentleman who's made a great contribution not only there but in the regional district and the Municipal Finance Authority. I'd like the House to welcome him at this time.
MR. D. BARRETT (Premier): I would ask the House to welcome the federal House Leader of the New Democratic Party and the leadership candidate for that party, Mr. Ed Broadbent.
MR. G.F. GIBSON (North Vancouver–Capilano): I'd just like to add my welcome to the very distinguished mayor of the District of North Vancouver, and a worthy opponent in the last election campaign.
MR. C. LIDEN (Delta):We have a visitor in the gallery today who's from a long way away. Mr. Arne Anderson, who is an active participant in U.S. politics in the Los Angeles area, is here today with Duncan Graham from Delta, and I hope the House will make them welcome.
HON. L.T. NIMSICK (Minister of Mines and Petroleum Resources): In the Speaker's gallery today I have two very good friends from the City of Kimberley. It's their first visit to the legislative chambers and I hope that you will make them welcome — not only welcome, but that they'll be able to go with a good impression of what goes on in the House. The names of the two people are Adele Buchan and Marie Martin.
HON. MR. BARRETT: I've only been blessed with one godson, but I'm very pleased that he's with us today. His name is Stephen Yee from Vancouver.
Introduction of bills.
PERSONAL INFORMATION REPORTING
On a motion by Hon. Ms. Young, Bill 79, Personal Information Reporting Amendment Act, 1975, introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.
ICBC SERVICES DURING STRIKE
MR. BENNETT: To the Minister of Transport and Communications. Can the Minister advise the House whether services are being provided by ICBC in all areas of British Columbia today?
HON. R.M. STRACHAN (Minister of Transport and Communications): To the best of my knowledge, yes, services are being provided. There was a press release made in Vancouver this morning by the general manager of the corporation, and an ad is being placed in the newspapers which regrets any problems that may arise out of the strike taking place right now on the part of the employees of the corporation. It carries instructions to anyone who may have to have a claim under Autoplan, and it says:
"If you have an accident and your vehicle can be safely and legally driven, there is no need to immediately report your claim. Simply record all the necessary details. When the strike is settled, report to a claims centre at your earliest convenience and the claim will be handled in the usual pre-strike manner.
"If your vehicle cannot be safely and legally driven and you require immediate repairs, have the vehicle towed to the repair shop of your choice. Two estimates of repair should be obtained, providing additional towing charges are not incurred. Have your driver's licence and driver's certificate with you.
"It is unfortunate, but you will be required to assume responsibility for the payment of your deductible at this time. When the strike is settled, report the details of the accident to a claims centre. After legal liability has been determined, the corporation will pay the deductible amount where appropriate. If you are not responsible in any way for the accident, you will be reimbursed entirely for your deductible. If the accident results in bodily injury, police will automatically report the details to the corporation.
"Insofar as claims under other ICBC policies are concerned, you are asked to report the claim to an insurance agent, and he will take all the necessary information."
MR. BENNETT: Supplemental. My question was: are services being provided in all areas? I think the Minister said yes. Can the Minister guarantee that they have a contingency plan that all services and all offices will remain open during the strike? Are officials being encouraged to cross picket lines?
HON. MR. STRACHAN: Crossing a picket line is entirely a personal matter. I don't know what you
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mean by all offices....
MR. BENNETT: All claims centres — all offices.
HON. MR. STRACHAN: I've just read to you the procedure to be used in view of the strike situation.
MR. BENNETT: Mr. Speaker, just a point of clarification: on my first question the Minister said that all offices were open.
HON. MR. STRACHAN: No, I didn't.
MR. BENNETT: I asked if all services were open and being provided in the province. I just wanted a clarification.
HON. MR. STRACHAN: I'm afraid you muffed the question because you asked me if services would be available all over the province.
HON. MR. STRACHAN: I said: "Certainly services will be available." In our minds, the services will be available.
EFFECT OF STRIKE ON
MR. G.B. GARDOM (Vancouver–Point Grey): Is the Hon. Minister prepared to give a definitive statement today about those people who may not have the necessary legal driving requirements as a result of the shutdown of ICBC? Will there be a moratorium on prosecutions under these circumstances?
HON. MR. STRACHAN: I think, Mr. Speaker, it's always been illegal and against the law to drive without having met the legal requirements. Anyone who did this prior to today was breaking the law and should not have done so. No one should drive an automobile in this province unless they have met the legal requirements, with or without a strike. No one should drive a vehicle without having met the legal requirements.
MR. GARDOM: Just a supplementary, then. It means this, does it not, Mr. Minister: those people who are not able to receive the legal requirements as a result of the strike will have to keep off the road? Is that your direction to them?
HON. MR. STRACHAN: It's always been that way. I'm not a lawyer, but I understand that's always been the way.
ASBESTOS FIBRE CONTENT IN AIR
AT CASSIAR ASBESTOS CORP. MINE
MR. G.S. WALLACE (Oak Bay): Mr. Speaker, I'd like to ask the Minister of Mines if it is correct that the amount of asbestos fibres in the air at the Cassiar Asbestos Corp. mine is 125 times the legal limit.
HON. MR. NIMSICK: Mr. Speaker, I am glad the Member asked that question because I expected a question like that today. It came over the air last night from CBC, and I was called on the phone about 10 o'clock. They got a report that's about two months old. Our experts had been in Cassiar at that time and found that the legal limits were too high. They gave orders to improve them. They went back a month afterwards; it was improved but still out of line. They ordered them to close down at that time and then got them to agree to set up a new system of filtration for the dust requirements in the Cassiar Asbestos mines. We are on top of this situation and it's being looked after.
MR. WALLACE: Supplementary, Mr. Speaker. I wonder if the Minister could tell us — I'm not sure from his answer — whether the mine is in operation at the moment. If it is, I think it's only right that we should know exactly what the level is, and how far in excess of the safe human level is the actual situation at the mine today. What figures are available?
The publicity coming in every day about asbestos shows that this is a tremendous problem in society, and not just to the people who work in the mine. Asbestos, period, is a very big problem which is becoming more and more serious in society. I think we should know if the workers are working beyond the safe level, however small the excess. Then I suggest the Minister should take immediate action to close the mine.
HON. MR. NIMSICK: Mr. Speaker, at the present time in any place in the mine that is in any way in excess, they've got to wear respirators — protective equipment — so that it will not affect them. If you remember a couple of years ago, they had an examination of all the men of long standing in Cassiar Asbestos, and they didn't find anyone with asbestosis at that time. Nevertheless, all the precautions are being taken, I'll guarantee you that.
MR. WALLACE: The fact is that the ravages of asbestosis develop 20 or 30 years after the person has been exposed. I wonder how frequently inspectors check the Cassiar mine and how often medical reassessments have been carried out.
HON. MR. NIMSICK: Mr. Speaker, it was inspected, I believe, in April or May. I was talking to
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them this morning and they are going in there again to check again now, so I think that everything is being done that is possible to be done.
MR. WALLACE: What about the medicals?
HON. MR. NIMSICK: I can't answer that. That's maybe the Health department.
MILL RATE LIMITATIONS
MR. H. A. CURTIS (Saanich and the Islands): Mr. Speaker, it was a good question but it's out of date already. To the Minister of Municipal Affairs: I wonder with respect to section 206(2) of the Municipal Act — that is, mill rate limitations — if the Minister's department has received any requests from municipalities seeking direction with respect to these mill rate limitations which are still in effect. If so, what direction is being given to the municipalities so inquiring?
HON. J. G. LORIMER (Minister of Municipal Affairs): Yes, I have had a few questions with regard to it and also from the UBCM. I expect that I will be presenting legislation to the assembly later on this month which will alleviate some of the problems.
MR. CURTIS: A supplementary, Mr. Speaker. In view of the fact that the deadline for setting of mill rates was May 15, a date now passed, I wonder if the Minister is aware of the fact and prepared to act in view of the fact that because the limitations are still in effect and not covered by amending legislation, indeed, some property tax notices might be considered invalid by the recipients and contested in the courts.
HON. MR. LORIMER: Those are always possibilities.
MR. D. A. ANDERSON (Victoria): Mr. Speaker, a question to the....
MR. SPEAKER: I wonder if you could give way for a second. There appears to be one more supplementary on this by the Member for Langley.
MR. R. H. McCLELLAND (Langley): Well, Mr. Speaker, I would just like the Minister to advise the House whether or not that legislation that he is going to be bringing in later this month will be retroactive legislation and whether or not any municipal clerk or administrator has so far allowed his council to exceed those mill rate limits.
MR. SPEAKER: Surely that's out of order at this time. You are asking for information still not before the House....
MR. McCLELLAND: Well, the second part of the question is not asking for that kind of information. Has any municipality exceeded those mill rate limits at this time, that the Minister is aware of?
HON. MR. LORIMER: No.
MR. McCLELLAND: Then what's the need for legislation?
MR. CURTIS: Mr. Speaker, a final supplementary on the same subject to the Minister....
HON. MR. LORIMER: We take action before it's absolutely necessary. We can foresee things coming and we like to get our tack in order before an emergency....
MR. CURTIS: Would that it were true, Mr. Speaker, would that it were true!
A supplementary. Has the Minister or his department directed any municipalities to postpone the mailing of their tax notices awaiting the arrival of this legislation which the Minister spoke of many weeks ago?
HON. MR. LORIMER: This is a fishing expedition. To my knowledge, no such letters have gone forward.
MR. CURTIS: A fatuous answer.
FERRY PREBOARDING PRIVILEGES
MR. D. A. ANDERSON (Victoria): A question to the Minister of Transport and Communications: I don't want to tax his failing voice; he must have done a lot of shouting over the weekend. I would like to ask whether the memorandum dated October 11, 1973, concerning priority and preboarding on government ferries was suspended last Friday to permit cabinet Ministers to avoid lineups on their way to the NDP weekend convention.
SOME HON. MEMBERS: Oh, oh!
HON. MR. STRACHAN: My voice was failing a week ago. You may not have noticed, but perhaps you weren't here on Friday. It was even worse on Friday. It's getting better.
I would have to check that. What date did you say the memorandum was?
MR. D. A. ANDERSON: The memorandum was October 11, 1973. The suspension was Friday, May 16, 1975.
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HON. MR. STRACHAN: I'll have to check the memorandum.
MR. D. A. ANDERSON: Thank you very much.
USE OF GRANTS BY
STRATA CORPORATIONS ASSOCIATION
MR. McCLELLAND: Mr. Speaker, a question to the Minister of Housing: Some time ago it was announced that there was an $18,000 grant given to the B.C. Association of Strata Corporations, and $2,000 of that grant, according to the head of that organization, Jean-Pierre Dehm, was spent for an annual meeting. I wonder if the Minister could tell us how many members the B.C. Association of Strata Corporations has, how many attended that annual meeting and where it was held.
HON. L. NICOLSON (Minister of Housing): I'll take that question as notice, Mr. Speaker, and try to get the information to the Hon. Member.
BY MINES DEPARTMENT
MR. GIBSON: Mr. Speaker, a question for the Minister of Mines and Petroleum Resources: is the Minister aware of reports of a cutback in summer student employment in his department and could he indicate the number of jobs this year, as compared to last?
HON. MR. NIMSICK: I'll take it as notice.
ACCOUNTING AND AUDITING PRACTICES
IN TAX SURVEYOR'S OFFICE
MR. CURTIS: To the Minister of Finance. I wonder if the Minister could assure us that accounting and auditing practices in the office of the surveyor of taxes with respect to property-tax refund payments are as complete and effective as he would wish.
HON. MR. BARRETT: What kind of question is that?
MR. CURTIS: Well, I'll be happy to pass to the Minister of Finance or file with the House, Mr. Speaker, the reason for the question, a letter dated May 10, from a resident of Salt Spring Island who says:
"At the beginning of March I received a refund of $551.98. At the beginning of April I received a refund of $551.98. I've been waiting for a notification from the surveyor of taxes that there has been a duplication, but apparently none is forthcoming. I do not wish to keep money I am not entitled to, so I am enclosing a cheque for $551.98. Copies of vouchers are attached."
HON. MR. BARRETT: I hope you send that over, and I appreciate your efforts to go through the usual channels, Mr. Member.
MR. CURTIS: As a matter of fact, that's already been done.
HON. MR. BARRETT: Oh? Then why didn't you tell the House?
MR. CURTIS: Mr. Speaker, I asked the Minister with respect to accounting and auditing practices within the office of the surveyor of taxes.
HON. MR. BARRETT: You asked the question without even telling me what you were talking about.
MR. SPEAKER: Order, please. That question doesn't qualify.
HON. MR. BARRETT: Shame! Shame!
FEDERAL CRITICISM ON PROVINCIAL
HANDLING OF INDIAN DEMONSTRATIONS
MR. WALLACE: Mr. Speaker, I would like to ask the Attorney-General a question with regard to statements by the federal Indian Affairs Minister, Judd Buchanan, that he's very unhappy with the Attorney-General's handling of demonstrations by Indians in British Columbia. Has the Attorney-General subsequently been in touch with Mr. Buchanan, and has there been any discussion about the Attorney-General's proposals to deal with the illegal occupation of federal buildings by Indians?
HON. A.B. MACDONALD (Attorney-General): I take exceptions to the unhappiness of the Hon. Mr. Buchanan with the efforts we made in the case of the Pacific Centre. I paid compliments in this House to the work of the team we had on the spot, led by Mr. Vickers and Mr. Hogarth. I complimented the leaders of the B.C. Union of Indian Chiefs, Bill Wilson and Lou Demerais, and I think we handled a tinder situation in a very capable manner at that time. I really congratulate my team.
I think, with all respect, that the Hon. Minister from Ottawa was misjudging the situation.
MR. D.E. SMITH (North Peace River): Mr. Speaker, I ask leave to suspend rule 48 and move motion 17 standing in my name on the order paper.
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Leave not granted.
MR. SPEAKER: The Hon. Minister of Transport and Communications.
AN HON. MEMBER: Was leave denied?
MR. SPEAKER: Well, leave was denied. Did the Hon. Member not hear?
AN HON. MEMBER: Did you hear any noes?
MR. SPEAKER: It was pretty obvious.
AN HON. MEMBER: I never heard a no.
MRS. P.J. JORDAN (North Okanagan): Neither did I.
MR. SPEAKER: Are you serious in that statement?
AN HON. MEMBER: I am serious.
MR. SPEAKER: There's a awful fog in the aisle, then, because I could hear very distinctly from the middle of the aisle.
HON. MR. STRACHAN: Mr. Speaker, I ask leave that the rules be suspended to allow the moving without notice of the motion appearing on page 6 of Votes and Proceedings for Friday, May 16, under the name of the Hon. E.E. Dailly (Minister of Education).
Leave not granted.
MR. SPEAKER: I heard some noes that time, too.
AN HON. MEMBER: So did I.
HON. MR. STRACHAN: Who said no for that? Who said no?
MR. SPEAKER: I have heard noes from both sides now. Could we get on with the next order of business, please?
Orders of the day.
The House in Committee of Supply; Mr. Dent in the chair.
DEPARTMENT OF THE ATTORNEY-GENERAL
On vote 21: correction services, $27,501,093 — continued.
HON R.M. STRACHAN (Minister of Transport and Communications): Mr. Chairman, I move the committee rise, report progress and ask leave to sit again.
Motion approved on the following division:
YEAS — 29
NAYS — 16
|Anderson, D.A.||McGeer||Williams, L.A.|
Mr. Chabot requests that leave be asked to record the division in the Journals of the House.
The House resumed; Mr. Speaker in the chair.
MR. CHAIRMAN: Mr. Speaker, the committee reports progress and asks leave to sit again, and further reports that a division took place in committee and asks leave that the division be recorded in the Journals of the House.
HON. MR. STRACHAN: Public bills and orders. Third reading of Bill 3, Mr. Speaker.
AMENDMENT ACT, 1975
Bill 3 read a third time and passed.
HON. MR. STRACHAN: Third reading of Bill 4, Mr. Speaker.
AMENDMENT ACT, 1975
[ Page 2456 ]
Bill 4 read a third time and passed.
HON. MR. STRACHAN: Third reading of Bill 9, Mr. Speaker.
REAL ESTATE AMENDMENT ACT, 1975
Bill 9 read a third time and passed.
HON. MR. STRACHAN: Third reading of Bill 10, Mr. Speaker.
FAIR SALES PRACTICES
AMENDMENT ACT, 1975
Bill 10 read a third time and passed.
HON. MR. STRACHAN: Third reading of Bill 20, Mr. Speaker.
SECURITIES AMENDMENT ACT, 1975
Bill 20 read a third time and passed.
HON. MR. STRACHAN: Third reading of Bill 46, Mr. Speaker.
POLICE AMENDMENT ACT, 1975
Bill 46 read a third time and passed.
HON. MR. STRACHAN: Third reading of Bill 48, Mr. Speaker.
AMENDMENT ACT, 1975
Bill 48 read a third time and passed.
HON. MR. STRACHAN: Report on bills, Mr. Speaker.
Report on Bill 1.
Bill 1 read a third time and passed.
HON. MR. STRACHAN: Report on Bill 5, Mr. Speaker.
ADMINISTRATION AMENDMENT ACT, 1975
Bill 5 read a third time and passed.
HON. MR. STRACHAN: Report on Bill 6, Mr. Speaker.
AMENDMENT ACT, 1975
Bill 6 read a third time and passed.
HON. MR. STRACHAN: Mr. Speaker, committee on bills.
Committee on Bill 7.
FARMERS' AND WOMENS' INSTITUTES
AMENDMENT ACT, 1975
The House in committee on Bill 7; Mr. G.H. Anderson in the chair.
Section 1 approved.
HON. D.D. STUPICH (Minister of Agriculture): Mr. Chairman, I move the committee rise and report the bill complete without amendment.
The House resumed; Mr. Speaker in the chair.
Bill 7, Farmers' and Women's Institutes Amendment Act, 1975, reported complete without amendment, read a third time and passed.
HON. MR. STRACHAN: Committee on Bill 45, Mr. Speaker.
The House in Committee on Bill 45; Mr. G.H. Anderson in the chair.
Sections 1 and 2 approved.
On section 3.
MRS. P.J. JORDAN (North Okanagan): Mr. Chairman, on section 3, I wonder if the Minister would advise the House if he has any intentions of extending educational programmes for those wishing to enter into beekeeping either as a hobby or on a professional basis, and also of making it more available to those who now wish to upgrade their standards.
HON. MR. STUPICH: Mr. Chairman, it won't be this department that will be extending it, but some of the regional colleges are doing it or are looking into it. As the pressure from the community builds, I'm sure more of the regional colleges will get involved in this kind of programme. Malaspina College in my own
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area, for example, has been offering such a course for several years now.
MR. D.M. PHILLIPS (South Peace River): Mr. Chairman, I notice there's no grandfather clause in here whereby people who have been in the bee business for quite some number of years automatically qualify for a certificate. Will it be made easy for these people who have been in the business to get the certificate? Will the questionnaires or examinations be made in areas where a lot of bees presently exist so that it won't work a hardship on these people who have been in the business for quite some time?
HON. MR. STUPICH: Mr. Chairman, this is not a new certificate; this is a very old certificate — this procedure of having a bee master certificate. It's always given as a result of passing a course. Even though people have been in the bee business for some time, that doesn't mean that they would qualify for a bee master's certificate. We are finding out more about bee diseases all of the time, and even for one who has had a lot of experience it would be well worthwhile attending a course in identifying bee diseases and know the control methods before that person is granted a certificate which really makes him eligible to be appointed as a part-time inspector more than anything else.
MR. PHILLIPS: I don't wish to be repetitive here, but just by point of clarification: as you realize, a lot of these bees are picked up in the California area. In that area, are these bees inspected? Are the people who sell these bees into foreign markets well-qualified to make sure that bees are not imported into the country? Is there any inspection at the border? Just as a point of clarification.
HON. MR. STUPICH: Mr. Chairman, they are inspected, and they have to be able to produce the records of inspection on crossing the border.
Section 3 approved.
Sections 4 to 7 inclusive approved.
On section 8.
MRS. JORDAN: On section 8, Mr. Chairman. I believe this is the same in the other Act: there is no prescribed fee for a deposit if a beekeeper wishes to appeal a decision by an inspector. I wonder if the Minister could outline to the House what the fee generally is, how it is arrived at and why he didn't include in that section a prescribed fee that could be adjusted from time to time by legislation or regulation.
Also, to the best of my knowledge, there is no provision in the Act anywhere for remuneration for this board which the Minister would set up in case of an appeal. I would ask why this has not been included in the Act, what remuneration the Minister intends to pay the chairman and those appointed, and on what basis.
I must again strongly object to the powers that are vested in the Minister under this section of the Act. It is an appeals section allowing producers to appeal a decision by government-employed and government-appointed inspectors. When one reads the section one sees that all members of the board — a three-man board — are appointed by the Minister himself without recommendations from anyone. I strongly suggest and urge the Minister that for section 8(3)(c) there should be recommendations for that third person submitted by the industry at large and, perhaps, by educational institutions.
Those names should be kept on file with a selection preference, donated, perhaps, by ballot by the members of the association at large and then appointed by the Minister. This would leave those who are going to use the appeal procedure feeling much more confident, I am sure, that those on the board would be rendering not only a knowledgeable decision but also a very impartial decision, and it would remove the Minister from any suggestion that he would be imposing his wish on the board through having complete control of the appointment and no avenue of appeal for those offended by those appointments.
HON. MR. STUPICH: Well, Mr. Chairman, the conditions under which the registration would be cancelled are outlined in the previous section. Subsection (1) of that, for example, points out that it may be at the request of the beekeeper involved, and subsection (2) is generally where the person has ceased to be a beekeeper or, for one reason or another, is obviously contravening the legislation. There has to be some avenue of appeal for circumstances like that. The fee for the appeal.... I believe this section is new; as I recall it, that wasn't in the previous legislation. The Hon. Member for Okanagan (Mrs. Jordan) suggests it is the same, but I think — and I could be wrong — it's a new section.
Certainly we would discuss this with the beekeepers' association, the whole appeal procedure. The amount of the deposit even is something we would discuss with the bee association before we get involved in this. It's something that I think will be a very rare occurrence. It's only where either a person has given up the business or is obviously contravening the legislation. It's not often that we are going to be faced with this kind of a situation. Regulations will be drawn up to provide for appeals in the event they should become necessary. They will be discussed, as
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are all of our regulations. They will be discussed with the people involved before we do pass it in cabinet.
MRS. JORDAN: The Minister didn't outline how the members of the board were to be paid.
HON. MR. STUPICH: Again, Mr. Chairman, we have not really given any thought to this. I suggest that it's something we would discuss with the industry before we even consider whether or not they would be paid. I think the suggestion — in areas where there are educational institutions involved in the bee master's certificate programme, for example — that it would be a good idea to involve someone from that institution to give them the experience and to give the beekeeping industry in that area that much closer liaison with the educational institution is a good idea.
MRS. JORDAN: Mr. Chairman, I don't want to get into a prolonged debate about this but I am disturbed by the Minister's comments. He is asking us to pass legislation here which gives him very wide powers in terms of appointing members to a board, in terms of saying whether or not they should be paid, in terms of setting a fee for the producer who might wish to avail himself of the services of this board through appeal. Then to indicate that there has been no thought given to any of these matters I find very disturbing.
I recognize that the appeal procedure may, indeed, be very rare, but I think the fact that it is rare is all the more reason for it to be clearly spelled out in the legislation and in the regulations exactly what the procedures are and exactly what the fees will be, in order that under these rare circumstances there can't be more controversy surrounding the particular issue that one would expect under normal circumstances. I must say I feel that the Minister is leaving himself open to severe criticism on these points.
HON. MR. STUPICH: Well, Mr. Chairman, that's just where the Member and I part company. In this particular respect I feel it is more appropriate to discuss the legislation in detail in the House before I start discussing the workings of that legislation with the industry. The industry certainly has been consulted about the general terms of the legislation, and they have agreed with the legislation as it is now. But with respect to the operations of the details of it, I think it would be an error on my part to get into that kind of a discussion until I have found out if the House is going to give me this kind of legislation. I feel that I am going the better route in bringing the legislation to the House, pointing out that the details of it will be worked out with the industry and outlined in regulations that will be passed by order-in-council.
MRS. JORDAN: Is this a change in policy?
HON. MR. STUPICH: Not for this Minister.
Section 8 approved.
Section 9 approved.
On section 10.
MRS. JORDAN: Well, section 10 deals with the suppression of diseases to bees in the Province of British Columbia. It states that for the purpose of preventing the spread of diseases, a person who brings bees into the province shall report their presence to the head, apiculture branch, in accordance with regulations. I don't think anyone would quibble with this, but I did point out to the Minister in second reading that there is a severe problem in these reportings and I think it's foolhardy to suspect, with the problems we have had in the past, that there is not going to be a continuation in the future.
There are bees being transported around the province and from one province to the other which are not registered and are not inspected when they come into the province. That's part of the reason for the Act.
I would ask the Minister if he will accept my suggestion and have an outline in all the weigh scales in the Province of British Columbia whereby, even though those operating the weigh scales are not familiar with beekeeping as such, they would be aware of the problem and they would be required to file with the Department of Agriculture the transporting of any bees which can't provide a bona fide registration. I believe in this way, those bringing bees into British Columbia, perhaps quite innocently, would be then in a position to be notified officially of the registration requirements in the Province of British Columbia. Conversely, the Department of Agriculture and this specific branch would be aware of the movement of any bees in and out of the Province, whether they were registered or not.
Would the Minister be willing to undertake this type of a programme? It certainly would add to cost and really no extra work, but it would help reinforce the Act.
HON. MR. STUPICH: The regulations controlling the movement of bees will be filed with the people at the points of entry between the United States and British Columbia. That's easy. When it comes to points of entry between British Columbia and Alberta, it's a bit more difficult. Weigh stations — there's one possibility, but they aren't always open.
I can only say that in the regulations we will try to provide, to the best of our ability, for the kind of control that we want in this registration, but the onus
[ Page 2459 ]
will still be on the beekeeper himself or herself to make sure that the movement of bees into the province is reported.
Section 10 approved.
Sections 11 to 28 inclusive approved.
On section 29.
MRS. JORDAN: I wonder if the Minister would clarify section 29 for us, and why he feels the need for this Ministerial authority to control the size of colonies and certify them when they are used in the pollination of agricultural crops.
HON. MR. STUPICH: The beekeepers do undertake to contract with orchardists for the services of the bees, and it's at a price for hives. I believe this section is to provide that when a beekeeper is contracting his bees on the basis of a hive of bees, he is contracting for a reasonable number of bees and reasonable service for the orchardist.
MRS. JORDAN: I still don't follow why there would need to be Ministerial discretion. I assume that — and it always will be — a contract between a beekeeper and an orchardist or producer, for example, is an open contract between the two. It's the orchardist who decides how many colonies he's going to need to service his alfalfa crop or his fruit crop, and this would be decided between him and the beekeeper. I didn't follow, from the Minister's statement, why there would need to be Ministerial control. If the beekeeper doesn't produce, presumably the orchardist or the producer is not going to enter into a contract with him again or would take civil action rather than appealing to the Minister.
HON. MR. STUPICH: It's a definition as to just exactly what is a colony of bees. I've just been given something to read by the Hon. Attorney-General (Hon. Mr. Macdonald) — I'm not sure whether I should quote source or not, (laughter) but it's with respect to this bill and perhaps it has some bearing on this section:
"The cappings of the aphis melipora
Are wondrous sights to see;
That's mostly because apiculturists
Don't really care for the bee." (Laughter.)
HON. A.B. MACDONALD (Attorney-General): Does that answer your questions?
MRS. JORDAN: What have you got against the birds and the bees? The Minister's having trouble answering my questions too.
HON. MR. STUPICH: Well, what I've been trying to say is that this section does give me the authority, if I'm called upon to exercise that authority at any time, to say whether or not what is professed to be a colony of bees is, indeed, a colony. If you read the section, particularly subsection (4), the number of active combs of bees or the square inches of the brood per colony is a measure of the queen's activity. If the queen in the hive is not active enough to meet the standards of the colony, then that particular hive is not really going to do the work of what would ordinarily be defined as a hive.
As the Member says, it's up to the apiculturist and the orchardist to come to some agreement on this, but if an apiculturist is defrauding the orchardist and moving in a bunch of boxes with a few bees in each box and they aren't really colonies in the true sense of the word, then I may define whether or not that apiculturist is, indeed, serving the orchardist properly, and may give evidence, if called upon, in a civil case.
MRS. JORDAN: Well, I suggest, Mr. Minister, that you really don't understand this section of the Act, with all due respect. The indication that you leave with this House in not truly understanding the Act is that you, as Minister, are going to enter into very close control of the individual habits and practices of the beekeepers in this province. One must question seriously if this isn't an extension of your authority that is beyond what is desired by the producers of this province.
HON. MR. STUPICH: Mr. Chairman, I'll certainly concede that I have difficulty in explaining to someone who doesn't want to understand it just what the understanding is, but I understand it.
MR. PHILLIPS: I just want the Minister to assure the House. We may be looking at apple orchards where it is necessary to have pollination, but in legume crops a lot of hives are put there strictly for the purpose of collecting honey. I would hope that we are not going to have regulations that if you have a certain acreage of clover growing for instance, you can't put just one hive in there, but that you could put as many as you want to or as few as you want to.
MR. PHILLIPS: Well, it says he "may," if I read the.... "An inspection and certification shall be made at the request of a beekeeper...." I thought this was permissive, but it says "shall." Maybe you would just assure me. As I say, with fruit crops it may be different — you may have to have a specified number of bees per tree, or something like that — but
[ Page 2460 ]
when you are growing legumes, it is an entirely different situation.
HON. MR. STUPICH: I certainly give the Member the assurance that we are not going out looking for trouble. There are other sections of the legislation that say how many hives there shall be in a certain area that is going to be harvested for honey, but when is a hive a hive? We are always inspecting hives. I don't mean every day we are inspecting every hive, but there is a continual inspection programme going on for disease control. Now if the inspectors, in carrying out this continuing programme, come across hives which are not truly hives, in the sense that the queen is not active, then that would not be counted; it would simply be counted as a non-hive, if you like. This section would give them the authority to say that that particular hive of bees is not a true colony. But we are not going to enter into arguments between apiculturists and orchardists, or apiculturists and raisers of legumes, unless we are called upon.
Section 29 approved.
Sections 30 to 32 inclusive approved.
HON. MR. STUPICH: Mr. Chairman, I move the committee rise and report the bill complete without amendment.
The House resumed; Mr. Speaker in the chair.
Bill 45, Bee Act, reported complete without amendment, read a third time and passed.
HON. MR. STRACHAN: Committee on Bill 65, Mr. Speaker.
FARM PRODUCTS INDUSTRY IMPROVEMENT
AMENDMENT ACT, 1975
The House in committee on Bill 65; Mr. Dent in the chair.
Sections 1 and 2 approved.
On section 3.
MR. PHILLIPS: Mr. Chairman, I presume one of the purposes of this section is to allow the Minister to invest in the lamb-processing plant in Lacombe. Has there been any effort on behalf of the Minister to look into the feasibility of establishing that plant in British Columbia? In future cases, rather than invest outside of the province, would the Minister assure the House that no investments will be made outside of the province where it is at all possible or feasible to have the plant established within the borders of British Columbia?
For instance, we could have the bee producers in the Peace River area wanting the government to invest in a honey-processing plant in Edmonton. I'd just like the Minister to ensure us that where possible those facilities will be in British Columbia.
HON. MR. STUPICH: There have been two suggestions for involvement by B.C. producers in plants outside of B.C. One is the lamb-processing plant in Innisfail, I believe, rather than Lacombe, and the other is the proposed rapeseed plant. Those are the only two that have come to my attention. In both cases, the large bulk of the production industry is on the Alberta side of the border. In both cases, I've said to the producers that in the event that the attempt to get one started on the Alberta side fails for one reason or another, then I'd be very interested in looking at the possibility of establishing that kind of a plant on the B.C. side of the border, because then the Alberta produce could flow into our plant. But it would seem that in both cases it would not be practical to have two such plants, at least not in the foreseeable future.
For the beginning at least, and to give our own lamb production industry an opportunity to grow perhaps to the point where we might need an industry here, the better way to go would be to cooperate in the Alberta plant.
MR. PHILLIPS: Just one further short question. I hope that the Minister would be able to assure me that once the investments are made in plants, particularly in the lamb-processing plant in Innisfail, there would be sufficient regulations built into the loan to ensure that the lamb producers on the British Columbia side of the border are going to be treated fairly with the producers on the Alberta side, and that should there be other cases where there are producers on both sides of the border, producers on either side of the border, regardless of where their plant is, are treated equally. In a case, for instance, where there might be an overload of lambs going through the processing plant, farmers on both sides of the border, particularly if the plant happens to be in Alberta, will be treated equally with the producers on the other side of the border. Just because they have the plant, we wouldn't want them to discriminate, particularly where we have a financial interest in it. Maybe the Minister could advise me just what types of precautions he's going to take in this regard.
HON. MR. STUPICH: There are two considerations, Mr. Chairman, that we did discuss
[ Page 2461 ]
with the Alberta people. One of them was the handling of the product, as the Member pointed out; the other was the cost of freighting the animals to the plant. In both cases, the people representing the Alberta producers, the Minister of Agriculture, the Hon. Hugh Horner, at the time.... we discussed this with him and he was only too happy to accommodate the problems that we have in that we're further away from the proposed plant than are their own producers. They wanted our participation and were quite willing to enter into an arrangement that would guarantee our producers that the animals would be purchased f.o.b. the farm or some central marshalling point in B.C. and that there would be guaranteed flow through the plant of our product in proportion to the Alberta product.
MR. PHILLIPS: My final question: supposing that we run into a situation where British Columbia wants the processed product returned and maybe Alberta wants to.... For instance, in the case of lamb, we're importing lamb into British Columbia from New Zealand. Naturally, the quality just doesn't compare with Peace River lamb. What guarantees are we going to have if the market in British Columbia requires the finished product to come back? How are we going to handle that?
HON. MR. STUPICH: Mr. Chairman, I was not in on any discussions with respect to the marketing of the product by the cooperative. It is a cooperative organization; the B.C. producers will be members of that organization. They always have the alternative, and we could help them with alternatives that would divert the product through B.C. packing plants, if necessary. Our relations with the Alberta people have been so good that I expect they would be cooperative in that as well, but I have not entered into negotiations with respect to the distribution of a product.
MR. PHILLIPS: Could I ask the Minister, Mr. Chairman, if before you make a final agreement or deal you will discuss this with the Alberta government to ensure that, as I say, we should have first refusal on a B.C. product if we require it? I think the people of the great lower mainland and the Vancouver and Victoria area should have the treat of having that superior lamb product here — nothing against Saltspring Island or Cortes lamb, but there isn't sufficient quantity. I think that over and above the exports from New Zealand and Australia they should certainly have first refusal, particularly if we're going to be involved in putting money into the processing plant.
HON. MR. STUPICH: I'll give that assurance, Mr. Chairman.
MRS. JORDAN: When you look to 2A(3) it says: "A producer-owned organization to which subsection (1) applies shall be deemed to be an agricultural enterprise for the purposes of sections 3 to 9." If I interpret that correctly, this again is expanding the sphere within which the Minister, on behalf of the government, can invest moneys.
If I understand it correctly, this allows a producer-owned organization to be almost virtually taken over by government control through investment, yet still be considered a co-op and still be considered an agricultural enterprise. This could include trucking; it could include wholesaling of food produce not necessarily produced in British Columbia. I wonder if the Minister would outline why he felt this type of extension of power was necessary, apart from the interest in the processing plant, meat-packing plant, which my colleague just spoke about.
HON. MR. STUPICH: Mr. Chairman, all it does is make the same sections of the Act that apply to farm products industries strictly located in B.C. applicable to any participation in such industries by B.C. producers in jurisdictions other than those within the boundaries of British Columbia. We had to refer to all those sections to make sure that we didn't find we were hamstrung from operating in that respect. I don't see this as giving us any new powers other than the powers to invest or to assist producers in investing in farm products industries in Alberta. That's really what we're aimed at.
Section 3 approved.
On section 4.
MR. PHILLIPS: Just one question on section 2. In section 2 it says: "...a condition of every loan, grant...." We have had some discussions in this House about loan-grants. It does have a comma in there, but does it mean loan or grant...so that we can delineate between a loan and a grant?
HON. MR. STUPICH: Sorry, Mr. Chairman, I don't quite.... Would you say that again?
MR. PHILLIPS: It says: "...a condition of every loan, grant...." Do you mean loan or grant?
At the top of page 2: "By striking out 'it shall be a condition of every loan,' and substituting, 'it is a condition of every loan, grant,'..." do you mean loan or grant?
HON. MR. STUPICH: Well, there is a comma there. Then we go to read subsection (3): "it is a condition of every loan, grant, or in the case of a
[ Page 2462 ]
grant and so on. So the comma is there.
Section 4 approved.
On section 5.
MRS. JORDAN: Perhaps the Minister would correct me if I'm wrong. Is this to understand that section 5, which amends section 9 in the original Act, is to extend the powers of the Minister to grant or loan moneys up to $3 million per enterprise?
HON. MR. STUPICH: I don't see the figure $3 million here.
MRS. JORDAN: At the very left. It is: "cancel indebtedness under section 3(g) or (h), at any time that the total amount of grants in that fiscal year exceeds $3 million."
HON. MR. STUPICH: I'm sorry. Yes, I was looking earlier in this because I knew you had a bunch of questions about this section that were not answered in second reading. That's why I was trying to find it.
MRS. JORDAN: Yes. Could you perhaps just clarify the points here because, if I understand it correctly, it is elaborating his ability to grant more money to individual enterprises.
HON. MR. STUPICH: Mr. Chairman, more in total. Theoretically, it could all be given to one enterprise, that's true.
Mr. Chairman, I'm just not sure. I did in second reading offer to give more answers if there were questions. Is the Member for North Okanagan satisfied with section 5? There were other questions you asked about the number of enterprises, shareholders — all those questions. I don't want to bother the House with them because I don't think anyone else is interested, but if the Member wants them....
MRS. JORDAN: Mr. Chairman, the Minister did give his commitment that these would be available today. I'm afraid I was taking him at his word and expecting a summary of the investments. Does the Minister have them available in printed form?
HON. MR. STUPICH: That's fine if that is all the Member desires, Mr. Chairman. I will just send it all to her in printed form.
MRS. JORDAN: Mr. Chairman, I would rather have had it before today's sitting so that we could have gone through it, analysed it, and questioned the Minister individually because, as I understand it, there is a fair amount of money out on various enterprises. I'm sure most of them are most worthy, but the Minister is aware that we are very concerned about exactly on what he is predicating the development of the poultry processing plant in the interior, for example.
As the Member for Shuswap (Mr. Lewis) likes to jump on the bandwagon and say: "Are you for it or against' it?" — this is not a matter of being for or agin'. There has to be some assurance given to this House and to the taxpayers of British Columbia that loans that are being advanced and enterprises that are being started in the agricultural section by this Minister have sound reasoning behind them. On the interior poultry processing plant, I repeatedly asked the Minister upon what reports and analyses he has based his faith in its development. There have been conflicting statements that it will not even see the light of day as far as balancing its books for three years, but that the Minister is convinced he can increase the fresh output of that processing plant on a local basis in order to do this.
I won't go over other questions, but there is serious concern, Mr. Minister. If the government wishes to proceed with this plant and if it is to be publicly subsidized, this House should know how long the Minister expects it to be subsidized and how he predicates his sales in terms of this province and perhaps other provinces. In what manner does he predicate these sales so that they will be able to balance their books, for example, in three years? Or does the Minister anticipate it will be subsidized for many years?
I feel that these are points that the Minister was going to bring out under this section so that I wouldn't have to repeat the questions. I think he knows the concern. Will the Minister file with this House the report done within the department — the feasibility study — on this plant so that we can examine it? Perhaps the Minister should have some outside opinions on the establishment of this plant not necessarily to say that it shouldn't be established but it may be able to bring forth some new avenues of promotion which would alleviate the necessity for a subsidy and many other factors that would be of great interest to this House. They should be read into the record, Mr. Chairman. I would ask the Minister to give his report now, if he would, please, and read it into the record.
HON. MR. STUPICH: Mr. Chairman, that was part of the question, as I understood it, that was asked in second reading. And the other was: to what extent are we involved in agricultural industries in the province already in this programme, who are the shareholders, to what extent are the directors shareholders, et cetera? So I'll read some of this into the record, Mr. Chairman....
[ Page 2463 ]
MRS. JORDAN: Mr. Chairman, we would like to have a complete report, please. This was the agreement the Minister made.
HON. MR. STUPICH: Mr. Chairman, the agreement I made during discussions in estimates was that I would file a report with the House. One report was an article from a magazine on poultry diseases in the Fraser Valley. I have since found that, and would have filed it in the House today, except that I let the time go by without doing so. The second one was an in-house report on the economic feasibility of the interior poultry processing plant. That information is still being put together by staff and will be presented by me in the House, as I promised it would be.
The other questions — I thought the Member wanted to know about the industries we're already involved in, but I think maybe now she doesn't.
MRS. JORDAN: Yes, I do.
HON. MR. STUPICH: You do?
MRS. JORDAN: I've got about 50 different reports here, all fragmented and....
MR. CHAIRMAN: Order, please.
HON. MR. STUPICH: All right, then. With respect to Pan-Ready Poultry Ltd. there were direct loans of $2.4 million, loans guaranteed of $1.1 million, share acquisitions of $100,010, which gives us a 40 per cent interest in Pan-Ready Poultry Ltd., an organization that owns Centennial Hatcheries as well as Scott Processing Ltd. So the total investment and guarantee — in other words, the total involvement under this particular legislation in Pan-Ready Poultry — is $3,600,010. The shareholders of that, of course, are the government, 40 per cent, and Pacific Poultry Co-op for the other 60 per cent.
IOK Poultry Ltd., one that we had hoped to get off the ground about a year ago, we are still having some trouble determining the best location for and the one for which I will table reports as soon as I can get the material together. Incidentally, there's been a very recent staff report, with some outside assistance, that would indicate it's looking better now than we had previously thought.
In any case, for the construction of the processing plant and the acquisition of equipment: loan guarantees of $1.3 million and the same 40 per cent interest in the share capital of that organization, $410. So there's an investment in that enterprise — not an investment, mostly guarantee — but a total commitment under this legislation of $1,300,410.
Swan Valley Foods Ltd. is one I discussed in some detail, I believe, in the House last fall in which we now have a 20 per cent interest and will be getting a further 10 per cent. It's currently being negotiated. The capital invested in that is $50,163. That was the cost of a 10 per cent interest. The other 10 per cent has not yet been paid for. The loan guarantees there are $5 million. So the total commitment under this legislation is $5,000,163. One of the directors of Swan Valley Foods is William C. Piper, who has, I believe, a 20 per cent interest himself. He has 23,295 common shares. He's a farmer at Creston. The other directors are Gordon D. Leversage, Clarence D. Christensen, Jack C. Wiggin and William D. Powry. Sig Peterson, the Deputy Minister of Agriculture, is a director of Swan Valley Foods Ltd., representing the government. He holds no shares in it.
Sorry I didn't mention the directors. The directors of the South Peace Dehy: Richard Johnson, who owns 61 voting preferred shares; Clarence Vaynor, 30 voting preferred and 30 non-voting common; Claude Benson, the same shareholding as Vaynor; Robert Coutts, 20, voting preferred and 20 non-voting common; Jack Daub, the department representative on that board of directors, who hold no shares; Victor Nobbs, 10 voting preferred and 10 non-voting common; Don Peterson, 10 voting preferred, 10 non-voting common. IOK Poultry....
HON. MR. STUPICH: South Peace Dehy. The total involvement now: direct loan, $180,000; loan guarantees, $1.5 million; share acquisition, $28,254 — a total of $1,708,254. That's it on South Peace Dehy.
Keremeos Growers' Co-op. The involvement there is a loan guarantee of $780,000.
Panco Poultry. Direct loan of $1.5 million, which was to replace the direct loan Panco formerly had from the previous owners, Federal Industries Ltd.; and then the share acquisition is $4.8 million. So there's a total involvement there of $6.3 million.
That makes up the current total commitment, at the end of April 30, 1975, of $18,738,837. There are a number of others that are in an advanced stage and are awaiting approval of this legislation.
In the B.C. tree fruits industry: the Tree-Fresh CA Storage, for $2.4 million; Kootenay Dehy — that's another alfalfa dehydrating plant — for $1.85 million; and a number of others — about eight on the list. But those aren't approved yet, so they aren't really appropriate to this.
The one that I missed that is not on top of this list, and it's another one that isn't quite through yet but is very close to it, is Chef-Ready Foods Ltd., which will involve a loan of $85,000, and there's a long list of shareholders. The largest share in it is 4,650 out of a total of about 30,000 shares.
[ Page 2464 ]
HON. MR. STUPICH: Those are the only two where there are any....
HON. MR. STUPICH: No, we've looked at a couple more in the Peace but they don't look good enough yet.
MRS. JORDAN: Would the Minister indicate to us how Swan Valley is progressing as a company, please?
HON. MR. STUPICH: The current stage of construction is that the Richmond plant, which will be producing — it's still being argued — something like 9 or 12 entrées, will be in operation, hopefully, June 7. Now at that time they'll not be in full scale operation, but they will be operating, hopefully, on June 7. The pilot plant has been closed down, the one that produced the products I distributed in the Legislature when I talked about this company some months ago. They built up enough of an inventory to satisfy the market in the four Woodward's stores that have had access to this product.
They're going to build up an inventory in the months of June and July and at that time, hopefully, will have enough ahead so that they will be able to supply all of the Woodward's stores and other chains that have shown a real interest in participating in promotion of this product — in particular Safeway, which could have been supplied earlier, perhaps, but said that they want to be assured that they'll have sufficient product to put it into their whole organization before they start accepting it. They seemed very pleased with what they had seen of the product and want to be able to put it into every store in the province when they do start.
What I'm saying is really that they haven't started commercial production yet, but hopefully will. June 7 is the target date.
The Creston Valley construction programme. They are currently processing potatoes — fresh potatoes, not the french fry product yet. They produced 19,000 tons of potatoes last year and they're selling these now as whole potatoes. The processing plant itself is under construction and expects to be ready for production of french fries late in November or early in December of this year. By this time, of course, they'll have another crop. At the present date — at least, last week — they were still planting potatoes, getting ready for the 1975 crop, and expect to be processing some of that at least into french fries late in 1975.
MRS. JORDAN: Could the Minister indicate, on the pilot project for processing, what the financial picture turned out to be?
HON. MR. STUPICH: I don't have the figures in my head. I do know that a large part of what they had done in the pilot plant has been charged to prepaid development expenses. From the point of view of an operating statement, the first year's statement will show a loss. They'll be writing off quite a large amount of the prepaid expenses and development expenses in the first year of operation.
From an accounting point of view, the company intends to show a loss in its first two years of operation and build up, from a corporation tax point of view, an entirely acceptable procedure. They will show an accounting loss in these first two years, because they feel they are going to need it in the third year to pay the minimum amount of income tax in their third year of operation.
MRS. JORDAN: I appreciate the Minister giving us these facts. I must again stress, though, that to the Members of the Legislature, in carrying out their duty and obligation that they are charged with by the people of British Columbia, it would be more helpful to have this type of information before the session or shortly after the session commences in order that, under the Minister's estimates, we can properly canvass the investment of these public funds as well as properly canvass the operations of these companies which must be prepared to come into the realm of public scrutiny in the Legislature if the government is to be a shareholder in these companies. I hope that next year the Minister will do this.
It's very difficult securing the orders-in-council, press releases and scurrying around behind the scenes to try and find out what is really going on. It shouldn't be necessary. As I mentioned before, there are public funds invested as shareholders in these companies, and as such they should be open to the scrutiny of this Legislature in time for Members to properly analyse the operation of these companies and to see that the public funds are properly protected.
HON. MR. STUPICH: I'll just give this assurance that as each company has its official year-end, and as the statements are ready, I am quite prepared to make them available to the Members. But the timing is just wrong; I can't promise that they will be available before my estimates. Certainly, the previous year's will be available, but it depends on the date of the year-end and the date of the estimates.
MR. L.A. WILLIAMS (West Vancouver–Howe Sound): While the Minister is in such an informative mood, could he advise the committee whether or not he has had occasion to cancel any indebtedness under the powers in section 9?
HON. MR. STUPICH: The answer is no. Nothing
[ Page 2465 ]
has been cancelled.
MR. PHILLIPS: I would like the Minister to explain why this product is not available. I have been trying to buy it and I just can't find it available.
HON. MR. STUPICH: I've been trying to get some myself.
MR. PHILLIPS: The only other thing that bothers me is the fact that I hope it won't be too long. And if it's going to be available to Woodward's or to Safeway, will it be available so that the small comer grocery store can have access to this product if they desire? What is your marketing policy going to be? I hope that you wouldn't just be giving Woodward's and Safeway the sole right to merchandising the product, even in the beginning. I realize you have some distribution problem.
HON. MR. STUPICH: Mr. Chairman, in the beginning the programme was to try and get some kind of measure of consumer acceptance or otherwise of the product. That was why we chose one particular store, a store that was determined by the experts to be in the best location to get some evidence as to the reactions of different people in the community — people of different income levels and different age levels. And we thought that was the best.
It was not intended to all that it would go beyond that store until commercial quantities were available, but the pressure was on because Woodward's were so anxious to get it into more of their stores and, reluctantly, the pressure was acceded to. It is our intention and the company's intention that by midsummer it will be available for any wholesalers who want to do it. But in working through an organization like Safeway, for example, it's again another way of getting the product into maximum exposure so that more people will see about it, hear about and know about it. That would again increase the pressure on the other wholesalers to supply it to the assorted stores about which the Member is talking.
MR. PHILLIPS: One further question. As the plant grows, of course, you will have merchandising in the other provinces so that.... Pardon my ignorance, but how large is the plant? What is your capacity? Will you be able to supply, or do you have a second phase of construction ready to go?
HON. MR. STUPICH: The initial production is intended to have the capacity to satisfy what is expected to be the B.C. requirement and half as much again. There is room at the Richmond plant to expand the production about double that, but that won't be needed for some time yet. We expect even the B.C. market, for example, to take a couple of years to reach what we think is a reasonable limit. It's expected that this type of product, within three years, will capture 2 per cent of the food market in the United States, and, of course, the situation is likely to be the same in Canada.
MRS. JORDAN: First, going to the Minister's last point regarding the output of the Richmond plant...and I must say, I didn't realize they intended to develop this plant on the lower mainland. It was my understanding — and I may have been wrong — that this was to help bolster the secondary economy in the Creston-Kootenay area, and to have the plant there. Perhaps the Minister would comment on that.
The Minister mentioned that the product itself is going to capture a large percentage of the American market as a type of product. I would like to know if the product coming out of the Richmond plant.... What studies have been done? Now it appears it will be in terms of a competitive product in Alberta, for example. Which product that you have studied will be the closest competitor, and how do the Swan Valley products appear price-wise in other provinces, as you see it now?
The other point I would like to ask about is the marketing principles that the company is going to operate under as far as distribution is concerned. The Minister mentioned during his statement that they've offered the product to other wholesalers in British Columbia, and I find this somewhat strange. It seems to me that if this is a company operating with taxpayers' money and in which the government is a shareholder, there should be the opportunity for direct purchasing by the smaller outlets.
Quite obviously, a major chain store can buy in volume and enjoy a price benefit whereas a small grocery store operating in the northern part of the province or in the interior or in the Kootenays would not be able to buy in volume and also would have to go through a wholesaler. If this is going to operate the way it seems to be, I would like to see a direct marketing arrangement between the small operators, the independent operators, and the manufacturing plant in order that they don't have to pay again to go through a wholesaler.
HON. MR. STUPICH: Well, first, Mr. Chairman, I would like to disabuse the Member of the idea that this is government money. There is $50,163 of government money in what is currently approximately a $10 million operation. The amount of actual government money involved will not grow much. It may double that $50,000 figure, and that would be about the extent of the actual government money. There is the guarantee, but the money that has been borrowed by the firm is amply secured by
[ Page 2466 ]
assets in addition to the government guarantee.
The marketing policy — and this is why I am a bit vague on this — is something that the company, in its wisdom, will decide. They are getting advice from people that I feel are very qualified to give that kind of advice. But it is a company that, for the present at least, looks as though it is being run very successfully by the directors. For that reason I think there is little to be gained by having the government interfere. Our role there is really to act as some sort of a watchdog over the operations of the company and make sure that it is operating in a reasonably successful way, and hopefully it will be developing B.C. agriculture.
As the Member points out, I am surprised at the Richmond plant, but the Richmond plant as well will be using B.C. produce. The samples that I distributed in the Legislature — one was chicken stew, for example — used B.C. chicken and B.C. vegetables. Apples was another one, using B.C. apples from the interior, and of course the potatoes were from the lower Fraser Valley, the very small potatoes.
I suppose the only one of the four products that I introduced at that time which could be said to be not of B.C. origin was the ravioli. But they are currently working on six to eight other entrees, most of which will be made up entirely of B.C. produce grown in the lower Fraser Valley.
The reason I am a bit vague as to the exact number, the company would prefer to come out with a line of nine entrées. The sellers, Safeway and Woodward's, would rather have a higher number. So there is still some disagreement.
The product has been all along, and still is being very carefully researched and watched by UBC — I've forgotten the doctor's name right now. He's been in on the programme from the very beginning.
The competition is largely from other processed foods, and it is a processed food, after all. The competition is from canned foods, and it's in a good position to compete with canned goods in that it is so much lighter to carry, easier to handle. It has competition from frozen foods, and the advantage there is that you don't pay the costs of freezing, initially, and of keeping it frozen, so it is much easier to handle. Roughly 75 per cent of the people who tried the product preferred it over canned and over frozen — not everybody, but roughly 75 per cent of the tests that were made. So it would seem to have excellent advantages from those points of view.
It is using B.C. produce. There isn't much government money in it.
I'm not sure whether I answered all the questions.
Section 5 approved.
HON. MR. STUPICH: Mr. Chairman, I move the committee rise and report the bill complete without amendment.
The House resumed; Mr. Speaker in the chair.
Bill 65, Farm Products Industry Improvement Amendment Act, 1975, reported complete without amendment, read a third time and passed.
HON. MR. STRACHAN: Committee on Bill 75, Mr. Speaker.
STATUS OF MEN AND WOMEN AMENDMENT ACT
The House in committee on Bill 75; Mr. Dent in the chair.
Sections 1 to 10 inclusive approved.
On section 11.
MR. L. A. WILLIAMS: Could the Hon. Attorney-General explain the reason for section 11?
HON. MR. MACDONALD: Mr. Chairman, that was one of the most difficult policy decisions we had to make in introducing this bill. By the ancient law of England, a woman whose chastity is impugned can sue for libel without proof of special damages. The debate we had, which raged for several days, was whether or not to apply that section to a man, so that we would have achieved equality whereby a man whose chastity was impugned could likewise sue for libel without proof of special damages, or whether we should abolish completely this archaic section of our laws. We chose, after a very close debate within the department.... We took the opinion of everybody including the secretaries. Everybody had a right to vote on this question within the department. We decided that the way to go was to abolish it completely.
MR. L. A. WILLIAMS: I'm grateful for that explanation, Mr. Chairman. But what you're doing is taking away from women a right which, I think.... You may say it was archaic, but I think it is most necessary in the law today. I don't see why this decision should be made by all those unchaste members of the department. (Laughter.)
HON. MR. MACDONALD: How do you spell that?
MR. L. A. WILLIAMS: There's no one chaste in your department...?
[ Page 2467 ]
HON. MR. MACDONALD: It depends how you spell it. C-H-A-S-E-D, yes!
MR. L. A. WILLIAMS: I would have thought that this matter would have been canvassed more among other groups in the community. This is like the cardinals making the laws in regard to what women may or may not do. I just don't think that all those old men in the Attorney-General's department should be allowed to take away this right so long established in the law that women have had. You may think that I am treating this lightly, but it seems to be unbelievable that a woman could be defamed in this particular way and then be obliged to prove special damage. Surely having been defamed is bad enough; but when you come to seek your remedy, you are put to some kind of test whereby you have to prove the damage that you have suffered. This must double or even quadruple the consequence of the defamation.
Sections 11 to 27 inclusive approved.
HON. MR. MACDONALD: Mr. Chairman, I move the committee rise and report the bill complete without amendment.
The House resumed; Mr. Speaker in the chair.
Bill 75, Status of Men and Women Amendment Act, reported complete without amendment, read a third time and passed.
HON. D. BARRETT (Premier): Mr. Speaker, committee on Bill 23.
SPECIAL FUNDS APPROPRIATION ACT, 1975
The House in committee on Bill 23; Mr. Dent in the chair.
Sections 1 and 2 approved.
HON. MR. BARRETT: Mr. Chairman, I move the committee rise and report the bill complete without amendment.
The House resumed; Mr. Speaker in the chair.
Bill 23, Special Funds Appropriation Act, 1975, reported complete without amendment, read a third time and passed.
HON. MR. BARRETT: Mr. Speaker, committee on Bill 25.
BRITISH COLUMBIA HYDRO AND POWER
AUTHORITY (1964) AMENDMENT ACT, 1975
The House in committee on Bill 25; Mr. Dent in the chair.
On section 1.
MR. D.E. SMITH (North Peace River): Seeing as there is only one section to the bill, I guess that is the only section on which I can speak, Mr. Chairman. This bill authorizes the increase in the borrowing power of the B.C. Hydro and Power Authority by a substantial amount. Perhaps that is needed in some respects in view of the cost of developing power today, but I do believe that we have to bring to the attention of this House the secretive manner in which the Minister of Finance has chosen to finance these corporations since he took office. At one time there was accountability, Mr. Chairman, with respect to the amount of money borrowed.
MR. CHAIRMAN: Order, please. I would caution the Hon. Member that in committee we are to deal with the details of the section and therefore not recanvass the principle that has already been debated in second reading. Will the Hon. Member continue, please?
MR. SMITH: Mr. Chairman, there is only one section. The section deals with the authority of the Crown to increase the borrowing power from $2.25 billion to $3 billion, an increase of $750 million. Now certainly in the debate on that particular principle and in this section of the bill, I have a right to speak on the idea of increasing the borrowing power of B.C. Hydro and Power Authority.
HON. MR. BARRETT: On a point of order, Mr. Chairman, I would like to inform you that in your absence during the second reading I suggested to the Members that we go into detail during this section. It was agreed to at that time by the Hon. Liberal leader (Mr. D.A. Anderson) as well. I don't know if the other Member was in the House.
MR. CHAIRMAN: Would the Hon. Member for North Peace River continue?
MR. SMITH: Thank you, Mr. Chairman, now that we have refreshed your memory as to when the debate would take place. I'm sorry. You were not in the Chair at that time; I apologize, but I bring to your
[ Page 2468 ]
attention the fact that it was agreed at that time that we would debate it in committee stage because there is only one section.
It would seem to me that the point is this. The Minister of Finance has asked the Province of British Columbia and the Members of this Legislative Assembly to increase the power of B.C. Hydro to borrow $750 million more capital that their present authority allows. In the past, much of the money required for the financing of B.C. Hydro has been received through internal financing on trust funds in the hands of the provincial government. It was without doubt one of the soundest methods of financing that we could achieve in any jurisdiction in Canada. It allowed us, as citizens of the Province of British Columbia, to participate through the interest that was earned by those trust funds and at the same time provide the capital funds required for financing the additional energy requirements in the Province of British Columbia, expansion of the B.C. Railway, and many of the services that people require in a building society in a province such as ours.
But this whole system and the whole scheme has been changed, Mr. Chairman, to the extent that now the Minister of Finance has decided — I presume in concert with his other cabinet Ministers — to borrow substantial amounts of money for capital expansion in the Province of British Columbia through undisclosed sources at undisclosed interest rates. We don't know who, if this trend continues, will own British Columbia a few years down the road. You know, it is interesting to hear the Minister of Finance and some of his other cabinet colleagues talk about the fact that we sold ourselves out to the money changers in New York and that the Province of British Columbia is in the hands of foreign ownership, and turn right around, almost in the same breath, and turn the other cheek and decide that it is good business, because he deems so, to borrow money from undisclosed foreign sources, including the Arab nations, to finance the expansion of Hydro and other people services in the Province of British Columbia. What makes it so unacceptable is the fact that for years we were able to do this without ever going outside of the boundaries of B.C.
We must ask the question of what happened to the capital funds available to us in the pension accounts and in all the trust funds administered by the Minister of Finance of the province. Where are they at? How are they being used? Is it an advantage to the people of the Province of British Columbia, or in the long run will it turn out to be a millstone around our necks and, instead of guaranteeing in perpetuity the pensions of civil servants and other people within the employ of the province, who are a long way from retirement, have them face the same proposition that the teachers in the Province of British Columbia faced many years ago? Is this one of the side effects of deciding to borrow money outside of the confines of the Province of British Columbia? It might be acceptable if the funds that were available were used to good purpose, but who's to guarantee that? As a matter of fact, as we look at the sorry record before us, there's no indication that those funds were used in a manner which would be profitable to the people of British Columbia who, after all, have a right to demand of the government an accounting for funds that are in their trust.
Yes, we've heard many comments by the now Premier of this province about financial accountability, about fiscal responsibility. But not only in this bill but in the means which he has chosen in the last year to finance capital requirements of the Province of British Columbia, he's pointed out, I think, to all the people of this province that he only paid lip service to his previous comments of a year and two years ago, that now we are in the hands of the moneychangers and that we are in the hands of foreign control. The money we require now, which would have been available had the Minister chosen a prudent course to follow in the investment of funds available through pension plans and other forms of investment, would have provided the capital that is now needed to complete what will be and prove to be the cheapest power generated in any location in the North American continent at this time. So it's unfortunate that we have to not only increase the borrowing power but look at a bill which will allow that money to be borrowed from whatever source the Minister chooses to use.
In that respect, it would seem that we require, more than anything else at this particular time, a provision enshrined in our statutes which requires the Minister of Finance to provide accountability to the people of this province on a regular basis. We need it now more than we have ever required it before, because at the present time we do not have that accountability, an accountability that should be open to the full disclosure before the public — not to a selected few people but to everyone who has an equity in the Province of British Columbia, and that means everyone who is a citizen of this province who pays taxes in this province. There should be no differentiation between one class of citizen and other. They're all here; they all pay taxes. They're all entitled to know and receive a full disclosure of the accounting practices followed by the Minister of Finance, and particularly the sources from which he derives the capital funds that will be needed for the expansion of our economy.
MR. G. B. GARDOM (Vancouver–Point Grey): Just a couple of quick words, because this has been discussed during second reading. I think the opposition attitude to this request for an additional $750 million in three lines — $250 million a line —
[ Page 2469 ]
boils down, once again, to the question of accountability. Mr. Premier, the accountability of your government is certainly not improved over the accountability of the former administration. I think until such time as you appreciate the fact, in this province, that we have to have accountability or a watchdog that is independent of government, we are going to continue to have difficulties.
We have found these difficulties that are spinning out of B.C. Railway. Surely to goodness, if we happened to have an independent auditor-general in the Province of British Columbia, we would have a body, a force, that could get into these problems and find out something about them long before they became crises. It seems that in British Columbia we are always moving from sort of a position of platitude to one of crisis. This could easily be completely circumvented by the institution of an auditor-general in the Province of British Columbia to see that the public receives value. He would be an independent check and balance, someone who would be independent of government and whose job and sole responsibility would be to blow the whistle on unauthorized expenditures — to blow the whistle when, in his judgment, he determined that the general public was not receiving value. We don't have that mechanism yet in the Province of British Columbia, and until such time as we do, we are going to continue to have difficulty, whatever the administration may be. I have advocated this ever since I've been a Member of this House. I have been railed against by one administration after another for suggesting it.
People are always talking about horses on the payroll. Well, I am delighted that someone was able to find that there was a horse on the payroll, because that individual is doing a job for the general public. I think this is probably one of the greatest criticisms the people of our province have today: they question whether or not they are receiving value. From a bill such as this with the explanation given, there is absolutely no way that one can determine if there will be value contemplated or value received. Within this we don't have any projections. We don't have any estimates. We don't have any indications of the precise need of an amount of money and, most important of all — or as a corollary at least, if not most important of all — we don't have an effective check and balance to ineffective expenditures and the public not receiving effective and true value for their tax dollar.
HON. MR. BARRETT: Mr. Chairman, I could, perhaps, best deal with it all at once or deal with the two subjects I have now.
First of all, I have to obviously dismiss out of hand the comments of the Member for North Peace River (Mr. Smith) about making information public. He made the statement, which is totally incorrect, that the interest rates are not known on the Arab borrowings. They are. Everything is public, Mr. Member. Perhaps it was an oversight of your research rather than by intent. But everything is a matter of public record on these borrowings, except the country of origin. But everything else is. I am glad that you acknowledge that, Mr. Member, because you were leaving the impression with the House.... If you will check the Blues, it was probably an oversight on your part. But you did say that the interest rates were secret, the conditions were secret — and that's simply not so. It's not true. The interest rates are known and the length of loans are known, as a matter of public record.
In terms of internal borrowing yes, Mr. Member, there is a prospect of doing major internal borrowings and continuing. But we have the pressure of the Columbia River treaty, which has been a matter of great debate, and it's a matter of record. It's not a matter that we brought upon ourselves, but no government, whether it was us or anyone else, could turn off the deal once it was signed. We have treaty obligations and we have to pay for those treaty obligations.
The third matter you raised was about internal financing. I can recall, as the First Member for Vancouver–Point Grey (Mr. McGeer) can recall...and one of the reasons why he will never join the Social Credit party is because the Social Credit method of financing was to starve the schools and hospitals. Some of the most eloquent speeches made in this House against that policy were made by the First Member for Vancouver–Point Grey. That is one of the many reasons why he would never join Social Credit, because he made the most eloquent pleas of all — of any Member of this House — against the policy of starving the schools and starving the hospitals for the Columbia River fiasco. That Member, while he ponders his independence, knows very well that any government that succeeded the Social Credit mess on the Columbia would have to pay the bill. That's what we're doing. So I commend that Member for his excellent analysis of the mess the Socreds got us into. I commend him for his analysis, his impassioned speeches that brought applause not only from the House but also from the galleries and the people of this province when he opposed the Social Credit policy of starving the schools, starving the hospitals.
HON. MR. BARRETT: Well, you are an independent Member, too, Mr. Member, and if you're leaning more to the Socreds that his impassioned speeches would allow you to, I just want to remind you of who created this mess. While the Liberal
[ Page 2470 ]
leader smiles and thinks it's uncomfortable for those two independents to hear this, this is a very grave matter. And even if they are uncomfortable, Mr. Member, they are stuck with sitting on the fence there.
They know what the policy was — starving the schools, starving the hospitals. Four times. Just to remind you while you're both there — when you ponder the decision of moving over to Social Credit — just remember the legacy of terrible management you will be taking with you.
HON. MR. BARRETT: Right. Now, to your point, Mr. Member. You are absolutely right in terms of some method of public accountability. Correct. Two things we did immediately, which somehow in opposition you find necessary to neglect.... I don't think you do it for political purposes; I think it is short memory.
HON. MR. BARRETT: That's right. I'm glad you acknowledge that because you would be the first when I recall it to remind the House that we now have Hydro appearing before public accounts, with the chairman of public accounts being that wonderful Member for the Cariboo (Mr. Fraser), who is now a part of the official opposition, but soon to be independent, because when the independents move in, he's got to move out. Somebody's got to make room up the pecking order. But while he is still there, he is chairman of public accounts, and we have had B.C. Hydro in front of public accounts. To hear the Member for North Peace River (Mr. Smith) — who has, by reason of embarrassment alone, left the House, not more than anything else — suggest that there is no accountability when Social Credit never allowed anything to go to public accounts committee is sheer politics, political politics, partisan political politics.
MR. P.L. McGEER (Vancouver–Point Grey): The worst kind of politics.
HON. MR. BARRETT: The worst kind of politics. You would know, Mr. Member, because you are now an independent, and you would never play politics as an independent. But for those who have labels to sit in this House and say that there is no accountability is nonsense.
Now, Mr. Member, the second thing we did.... And you are quite right, the history of us getting at any of these things was zero. I don't want to ruin your political career completely, but you are quite right. We asked the comptroller-general to go in and check the books of B.C. Rail and B.C. Hydro. He came in with a very good report on Hydro, not so good on B.C. Rail.
MR. R.H. McCLELLAND (Langley): Order, Mr. Chairman!
HON. MR. BARRETT: You bet your life, call order on that one! I can understand why. Just pull your tie up a little bit tight and fasten your seat belt, partner; your government is responsible for situations we found. You are absolutely right, Mr. Member for Vancouver–Point Grey, we had to go in, so we use the government agency of the comptroller-general. That report was filed in this House. I know you forgot to mention that because it slipped your mind, but it was never done before — two things: public accounts and the comptroller-general. Have you read the comptroller-general's report on B.C. Hydro?
AN HON. MEMBER: I read it before you did.
HON. MR. BARRETT: You did, eh? How could you read it before I did? I filed it in the House.
AN HON. MEMBER: You weren't here. (Laughter.)
HON. MR. BARRETT: So, Mr. Member, I know it is embarrassing for you to have to sit so close to that group.
MR. A.V. FRASER (Cariboo): Balderdash!
HON. MR. BARRETT: You bet your life your colleague's speech was balderdash when he gets up in this House and says that we've got to have more accountability. They never let public accounts in; they never let the comptroller-general in. As a matter of fact, one of the statements made by the comptroller-general was that he was never allowed full access of those books under the Social Credit government.
MR. GARDOM: Why didn't he tell the public?
HON. MR. BARRETT: Now, here is the point; here is the proof of the pudding! The Member asks: "Why didn't he tell the public?" Well, under whose administration did he tell the public? Our administration. How do you think it came out publicly? For a lawyer, you've been hoisted. Why do we lowly social workers have to straighten out these lawyers all the time?
MR. McGEER: What about the auditor-general?
HON. MR. BARRETT: Oh, the auditor-general!
[ Page 2471 ]
HON. MR. BARRETT: Shh! Independents, don't speak, because if you are trying to rationalize your way to Social Credit, and you start calling for an auditor-general, then you are joining the wrong party.
MR. McGEER: What about the auditor-general?
HON. MR. BARRETT: Oh, Mr., Member, don't dig a hole any deeper than you have to.
MR. McGEER: What about the auditor-general?
HON. MR. BARRETT: What about him? What did the federal Liberals try to do to old Max? Tell us, what are you trying to do with old Max? (Laughter.)
Anyway, aside from old Max, how in the world did the statement become public that the comptroller-general said that he was never allowed to look at the B.C. Rail books? Because we ordered him to go in there and make a public report. We ordered him to go in and make the public report, and he said that he was never asked or allowed to do that before. Mr. Member for Vancouver–Point Grey, be fair. As you consider your own future, look to the past and be fair. No other government allowed this to take place in British Columbia before. Even Liberal administrations, so help me goodness, when they were in power in this province never allowed this to take place before.
HON. MR. BARRETT: Now the comptroller-general has said a lot
of things about empty spaces in the Liberal Party. He can't
help that. You've got your own problems.
Now we have driven out the two independents — they are going out to caucus to consider their political future after they've heard what has happened with Social Credit. That's what they're out for. There's no way those two could join Social Credit, but I have to remind them anyway.
So now the next matter is what we're stuck with in terms of paying for. We have tremendous hydro needs in this province. We are committed to the Columbia River treaty completion, we have Site 1, and we have the Pend-d'Oreille.
HON. MR. BARRETT: How many dollars each? I anticipate that the total amount will be close to the maximum allowable in terms of the additional borrowing power in this bill. We're hopeful that that's the figure.
The internal financing, of course...the first call on internal financing will be schools, hospitals, the colleges and other services. The only two borrowings that not complete information is known on is the name of the country that we borrowed $200 million from. All the details of that loan are available.
Now the last subject, of course, is the public information raised by the Member for North Peace River (Mr. Smith). We filed a prospectus in New York, Mr. Member, and I will see that a copy is available to you if you wish one. All you have to do is drop a note to the Finance department and they will make available copies of the prospectus because it's a public document required by the SEC.
So that's really where it's at. We've inherited an obligation on hydro development that we would have to go ahead with, whether it was us or anyone else. The decision on Site 1 was our decision, although most of the engineering work had been done prior to us coming into office. Site 1 commends itself because it's a maximization of a river that's already been damaged.
MR. J.R. CHABOT (Columbia River): Pretty costly power.
HON. MR. BARRETT: The Peace River is pretty costly power, but that was a commitment we had from the former administration, and we have to maximize what we're faced with. Look, if we had our druthers, we'd rather you had not gone the route you did. But it doesn't matter what party's in power, you have to make the decisions that are obvious.
HON. MR. BARRETT: Well, we can go through those old debates over and over again. If I had the ability to scrub out your terrible mistakes, I would do it. But once faced with the hard information that we had in 1972, the obvious option was to go for Site 1 — the obvious option.
Now the matter of alternate power. The government has moved to cover all the geothermal sites under public ownership. The government has in front of it the concerns expressed by many people in the power field about shifting to energy produced by the use of coal. The government has taken a position opposed to the development of nuclear power stations.
AN HON. MEMBER: Are you revising that?
HON. MR. BARRETT: We're not revising that decision. That is our position. I would commend you to read some of the comments I made shortly after coming into office and how there was chuckling in the newspapers about some of my statements, only to find that my statements about the forthcoming
[ Page 2472 ]
energy crisis were a warning about a year before anyone else picked up on it. But it's not, I have to confess, because I have any great talent or ability. I just made myself available of the Rand Commission's report for California and its power projections in that state, and they are applicable in a smaller scale for us here in British Columbia. While the newspapers with their thorough, researching reporters knew what I was talking about, the editorial pages didn't. The working press knew that I was correct, but their reports were suppressed by the owners...
AN HON. MEMBER: No way, no way!
HON. MR. BARRETT: ...who would not keep their eyes open to the information that was....
MR. GARDOM: Lackey press.
HON. MR. BARRETT: They are not the lackey press. They are just the poor minions of the press. Nonetheless, the Rand report was a frightening document.
MR. GARDOM: Let's hear it for Snifkins!
HON. MR. BARRETT: Snifkins? (Laughter.) That's a new political party.
The Rand report indicated the tremendous pressure there would be on power needs on the California coast. They projected that by the year 2000 there would be a need of a nuclear power plant every eight miles along the California coast, if the projected growth continued.
We cannot consider that alternative in this province. Given the question marks about the safety of nuclear power and the question never discussed publicly — and let me be the first to remind you; it won't be an earth-shaking headline or anything else — but the one subject about nuclear power that is not discussed publicly, aside from the safety, aside from the technical problems of the engineering, is availability of supply of radioactive materials. I want to tell you something: the technical systems of CANDU are probably among the best in the world, but the problem that is not discussed — and I suspect the real reason why the slowdown in the United States — is not so much (a) the pollution problem, (b) the technological problems, but (c) the question of supply.
How many years' supply are there available to North Americans for the development of nuclear plants? Who controls that supply?
HON. MR. BARRETT: Hundreds of years? You may be surprised, Mr. Member, to find out that that myth is the same kind of myth that let us believe 10 years ago that we had unlimited oil supply in this country.
MR. G. F. GIBSON (North Vancouver–Capilano): Would you stake your seat on that?
HON. MR. BARRETT: I want to tell you, Mr. Member, that I recall how the oil companies told your federal government, of which you were a part, that there was an unlimited supply of oil and natural gas in Canada. Tens and tens and tens of years; that's the guff that was pedalled by the federal Liberal government that led to our export policy.
Who paid attention to the NDP? The oil companies sold the federal government on the policy. Now we don't have any national energy policy; to this day we don't have any energy policy.
HON. MR. BARRETT: Mr. Member, we still do not have a definitive national energy policy out of the federal government. They have suffered in their direction with the loss of all that expertise and confidence from the former Member for Esquimalt Saanich (Mr. D.A. Anderson), who knew the answer to every question there was. How the federal Liberal caucus has lost because of his absence! His technical skills, his expertise and his knowledge were a great help to the former Prime Minister; that's why they urged him to come to B.C. (Laughter.)
Seriously, Mr. Chairman, there is a very serious question about the availability.
HON. MR. BARRETT: I want to tell you, Mr. Member.... You're surprised to hear that. I will make available to you some....
HON. MR. BARRETT: No, no, no, no, no. I'm always about a year ahead of time. I'll make some reading available to you, Mr. Member; don't get too anxious. With a 57-vote majority, you want to read a little bit. (Laughter.) I'll make some information — shhhhh!
AN HON. MEMBER: We'll have a run-off.
HON. MR. BARRETT: No run-offs for you, partner! A skin-deep victory is all you can hope for. You don't go around looking for run-offs.
Look, I'll make available to you some current readings to you that I find quite....
[ Page 2473 ]
HON. MR. BARRETT: The CANDU system in terms of technology is not a question of supply, Mr. Member. There is a great deal of difference, but of course I can't impress that upon you because you know everything there is to know. But I want to suggest to you Mr. Member, that there is a growing concern about the evaluation of the consistency of supply. I think that there is reason for us to be very, very concerned about the information we've been fed and the gap between that and the facts. I'll make some reading available to you and also some other information that's come to our attention that makes us very concerned. I'd be happy to chat with you about it.
So that's the point. We've made the commitment to the hydro development; we'll maximize those rivers that are already damaged: the Columbia system, the Peace River and the extensions of that.
The choices to be made within a few years have to relate to the use of coal. The late Dal Grauer wanted the B.C. Electric Co. to go ahead with the Hat Creek coal deposits. As a matter of fact, that decision lead to the political seizure of the B.C. Electric. I choose the word carefully about seizure, because at this current time in the atmosphere of politics in British Columbia one has to go back to the only government that seized property in the history of this province. They seized the Black Ball Ferries — that was under Social Credit; they seized B.C. Electric — that was under Social Credit. I just want to remind those great freedom fighters how they seized property after having told the public a different story.
As a matter of fact, as I recall it, in relating to Hydro....
HON. MR. BARRETT: No, no, I'm talking answers to Hydro policy. You wanted this debate in here. I'm saying that in 1960, during that election when great Hydro issues were being debated and the course of these funds at that time were being set, we were told that at no time would there be public ownership of the B.C. Electric if you voted Social Credit.
HON. MR. BARRETT: I'll tell you how it relates. The decision was made at that time not to go ahead with Dal Grauer's plan of development of the Hat Creek coal; the decision was made to go for the political expediency of the Columbia River deal and the two-river policy of the Peace River as well. That's what relates to this bill; that's what the people of this province have to pay off. Nine months after that election, the B.C. Electric was seized, taken over, expropriated, nationalized, Social Creditized, thumped over the head. The day freedom died in British Columbia!
I know they'll all resign now and say they regret having made wild statements about our government, considering the record that this government had to take over from them. We've got to pay for the Columbia, which was purely a political decision over there.
MR. SMITH: No wonder you're going down.
HON. MR. BARRETT: Look, Mr. Member, we have to pay for the Columbia — somebody has got to pay for it. The people of this province are burdened with the Columbia.
AN HON. MEMBER: You say that with every bill.
HON. MR. BARRETT: Well, if you find some other way we can pay the bills, let me know. I'll be happy to find out how we are going to pay off the mess we inherited.
HON. MR. BARRETT: Yes, you are going to put your finger in the dike — that's what you're going to do.
So along with that, Mr. Member, we haven't reached the auditor-general section yet, but we do have the problem of raising the funds. We do have the public accounts committee available, where the B.C. Hydro director will be available. Mr. Chairman, I know it's painful for them, but they want to be answered, so I'm giving them the answers.
So that's where it stands, Mr. Member, and it is a matter of record that the comptroller-general did go in, and his report was filed for the benefit of this House. There were no holds barred on him by this government, none whatsoever.
HON. MR. BARRETT: Well, it's the next best thing to it, Mr. Member. We can't give you perfection, but we can give you almost nirvana, not quite.
MR. GIBSON: Mr. Chairman, the rules of relevancy have been given quite an expansion in context this afternoon, which no opposition Member will disagree with for one minute. I think it is a wonderful thing that we are having such a wide-ranging debate on this bill.
It's a very short bill, and here we are at committee stage, being asked in three lines to authorize, on behalf of the public of British Columbia, an extra
[ Page 2474 ]
three-quarters of a billion dollars for the B.C. Hydro and Power Authority.
My question to the Premier is very simple: what is the money going to be used for, over how long a period and exactly how much on each project? I just assumed that the Premier was going to come in here with charts, diagrams and figures — all this kind of thing which would tell us exactly what this three-quarters of a billion dollars of the public's money was to be used for.
HON. MR. BARRETT: Public accounts will do that.
MR. GIBSON: It's not there. "Public accounts will do it," he says. After the fact it will do it, Mr. Chairman. Can you imagine the gall of that? Here we are being asked to vote money, and we are asking in advance what the money is for. After it's blown out of the barn, what good does it do us then? What good does that do the people of British Columbia then?
HON. MR. BARRETT: Weeks ago you could have had it.
MR. GIBSON: Do you know what reference the Premier gave us, Mr. Chairman? A public document required by the Securities and Exchange Commission in the United States of America, not anything revealed under the laws of British Columbia, and not tailored to the kinds of things needed in this bill.
I ask the Premier to stand up and tell us these exact things: over how long a period will this money be spent? How much will be spent on the Columbia, Site 1, the Pend-d'Oreille? How much will be external funding and how much will be internally generated by B.C. Hydro? Very simple questions there.
Now I will just touch for a second on the nuclear supply question, Mr. Chairman, because the Premier said there was a genuine supply concern arising in Canada.
HON. MR. BARRETT: In the world.
MR. GIBSON: I'm talking about Canada. We live in Canada, Mr. Premier. I guess the Premier didn't hear me, but I stood up and I said: "Will you stake your seat on that?" He didn't answer that. I was surprised, because he seemed quite sure of what he was talking about.
HON. MR. BARRETT: Supply in the world.
MR. GIBSON: But how about the supply in Canada? It is Canada where we live, Mr. Premier, and it's Canada that controls the supplies of uranium and thorium which are in the Canadian context.
HON. MR. BARRETT: But we have no overseas obligations?
MR. GIBSON: We have some overseas obligations, but they are very slight. They are very slight, so far.
HON. MR. BARRETT: Aha, so far!
MR. GIBSON: As a matter of fact, do you know what the president of Atomic Energy of Canada said the other day in Halifax? I was so struck by this that I wrote him a letter and asked, "Can this really be true?" He wrote me back a copy of his speech saying: "Yes, this is really true." What he said, basically, was that there is a thousand years' supply of uranium in Canada for every Canadian using three times as much energy as they use now.
Now if that is a supply problem, Mr. Chairman, I have to be puzzled by this Premier of ours. But as I say, that is essentially a red herring; he's got his mind made up about nuclear power anyway.
Now I want to ask the Premier whether any of this money will be used for Hat Creek coal development, and when that project is going to come on. He's talking very vaguely about it. When is it going to come on?
I want to ask the Premier what the load forecasts are for British Columbia Hydro, because naturally that is what determines what money is going to be required. The issue of Progress, which is a B.C. Hydro publication, edition of summer, 1974, gives this quote: "The usage of electricity of B.C. Hydro customers rose by 10.7 per cent over the previous year." Another quote here: "In the gas service, usage rose 9.6 per cent to 711 million therms."
I would like to know what the Premier's forecasts are. Is he going by the B.C. Energy Commission forecast, or is he going by the B.C. Hydro forecast, because the energy commission forecasts are substantially lower and make a great deal of difference in the amount of capital required. Which one, specifically, is the one that is being used here?
Now in terms of the internal generation of funds in British Columbia Hydro, I want to ask the Premier whether those internally generated funds are predicated on the assumption of a rise in the price of the natural gas rate to domestic and/or industrial consumers. If it is not predicated on that, how does he square that with the energy conservation ethic and the need to price energy supplies at their real economic value, taking that into the income stream of the province and compensating back, if necessary, those people who can't afford that increase?
I want to ask him if the fund generation capabilities of Hydro assume some kind of rise in the domestic price of natural gas.
As I say, we're more or less groping in the dark.
[ Page 2475 ]
We haven't been given the fundamental data base we need to ask the proper questions, but perhaps I'll be back if the Premier provides some answers to those.
MR. G.S. WALLACE (Oak Bay): Mr. Chairman, when one deals with these very substantial figures, I can tell the Minister of Finance and the House that the man on the street, the citizen in British Columbia, is boggling more and more at the financial affairs of the present administration. As I've said on previous debates in this House, if there is one issue, rightly or wrongly, which is likely to bring this government down — I say this very sincerely in a non-partisan way — if you listen to what the people of British Columbia are saying today, if there is one issue that scares them out of their skins, it's the apparent rapid escalation of the very large sums of money which this government is either seeking to borrow or is spending out of reputed surplus.
For example, in trying to be cooperative from our side of the House on one of the difficult issues we're faced with on estimates, I get angry telegrams from individual citizens in this province, misinformed as they are, that the Liberals and Conservatives have made some kind of a deal with the NDP to go behind closed doors to finish debate on estimates. That's how absolutely wrong people can be in trying to understand what's going on in this chamber and this Legislature. On this particular issue of the estimates, the person sending me the telegram is completely uninformed and, worse than that, when I phone him he doesn't have the courtesy to apologize when I tell him that he doesn't know what he's talking about.
Nevertheless, the one big issue — the big issue — and it applies to any government in power, is its handling of the money. Everywhere you go in this province, citizens, many of them with a knowledge confined only to superficial data and block figures, wonder how on earth the government can manage to spend as much money and be seeking to borrow so much money.
On this particular bill...and I've listened with interest to some of the projects which the Premier tells us the government more or less has to be committed to, projects which have been started and have to be finished, and the history of governments is that they very often have to make certain decisions about which they have little choice. In this particular instance, they're asking for borrowing power of another $750 million, in conjunction with this government's statement that they're so concerned about the mess in connection with the Columbia River treaty that we must have an inquiry. When that statement is made so bald and unequivocal, and it was made several weeks ago, I must say that I find it very difficult to readily buy the Minister of Finance's argument that this money will all be spent in the manner he suggests, when in fact it might be easier for the opposition to understand this bill if it could be debated after we have the inquiry on the financing of the Columbia River project. It seems to me we're putting the cart before the horse, when we've already been told by this government that....
MR. WALLACE: But the fact is, while the projects in large measure will have to go ahead, the Premier has stated many times that the reason for such large sums of money being required is the financial mess which was negotiated by the former administration. I think the Minister would have to acknowledge that if we're being responsible as opposition Members, I would like to know how much of this $750 million that will have to be borrowed is to catch up or correct or to neutralize the amounts of money which are required in excess of those budgeted for in the original Columbia River treaty project.
We've heard all kinds of ballpark figures bandied around in the past several weeks, inside and outside of this House. The opposition could be much more intelligent and better informed in this debate on this bill if we had some information, even at this late stage, from the Minister of Finance as to how much of this $750 million will be used to meet the unexpected or uncalculated costs on the Columbia River treaty project which the Premier says is the source and centre of most of his financial problems with Hydro.
It's quite clear, from statements also made by the Hon. Minister of Lands, Forests and Water Resources (Hon. R.A. Williams), that he also considers that the financial arrangements were ill-considered or badly arranged and in all respects a disaster, in his opinion, for British Columbia. And he is a member of Hydro.
We would have to ask the question: in asking for this kind of borrowing power, are we not putting the cart before the horse? Would it not be reasonable to take the position that if we have the whole story we might be able to decide to what degree this kind of money is justified in being authorized by the House?
Incidentally, Mr. Chairman, regardless of this specific bill, I would speak in favour of the principle of an auditor-general who reports to the House, who does not report to a Minister or report anywhere other than directly to the House and hence to the people of the province. And that's regardless of what government is in power. It seems to me that the role of the auditor-general at the federal level.... Not that the government pays much attention to him, mind you; all they do is scream and holler because he reveals their weaknesses, and they purposely keep his staff to a minimum so that he can't keep up with the work he's expected to do. So I would add the proviso that there is no point in creating an auditor-general unless you give him the kind of authority which is necessary and the terms of reference to report
[ Page 2476 ]
directly to the House and an adequate number of staff to do the job you are asking him to do.
So, in passing, I would support the comments very strongly of the Liberal Member for Vancouver–Point Grey (Mr. Gardom) that an auditor-general is a very important safeguard and a very useful mechanism for the people of the province in being able to know precisely what financial performance the government of the day is giving on behalf of the people.
Regardless of the auditor-general aspect, this is a pretty large sum of money we are being asked to agree to for the increased borrowing capacity. I feel that we need some more specific detail than the Premier has given us, and I would like him to answer my questions regarding the inquiry.
Would it not make a lot of sense if we had some of the kind of information which will come out of the proposed inquiry? When are we going to get it? What will the terms of reference be? To what degree will individuals in society or groups or politicians in the opposition have the opportunity to take part in the hearings; and there are a whole host of other questions in relation to the inquiry.
Over and above that, could the Premier give us a breakdown on the extra $750 million and for what specific projects this money will be used? And as the Member for North Vancouver–Capilano (Mr. Gibson) asked, over what period of time are we being asked to agree to the borrowing of this kind of money?
MR. PHILLIPS: I am glad to see that the Premier is back in his usual form after the suffering he's gone through in the last couple of weeks. I am glad to see a smile on his face and to hear him repeating his speech that he made to the NDP convention over the weekend.
I, too, Mr. Chairman, am greatly concerned over this and other — we used to use the term "blank cheque" — legislation, and that's exactly what this is. In view of some of the statements the Premier made in the Legislature last spring, I am greatly concerned, and I think we should be advised exactly where he intends to borrow this money and for what purpose he intends to use it.
Now it's all very well and good for the Premier to harangue the Columbia River treaty. I wasn't in the Legislature at the time it was being debated but, from the records I can find, he was not really against the Columbia River treaty — not against the details of the treaty — but he was against the two-river policy.
HON. MR. BARRETT: No, you're incorrect.
MR. PHILLIPS: I remember the reports, in the research I have done, where he said: "Don't build the Peace River at all. Don't even start it until 1984." British Columbia would be in darkness today if we had listened to that Premier of Finance when he was in opposition. We would be in darkness today. But he has a lot of hindsight; and it's too bad he has so much hindsight, because I wish and the people of British Columbia wish that he had a little more foresight. Then we might be not quite so hesitant to vote the ability of the legislative authority, as it were, to go out and borrow an additional $750 million.
I recall very well in June of last year, when we were debating a similar bill, what the Premier said. On June 18, 1974, he says that we have made a conscious effort; the conscious choice will be to go to the market for $100 million of the $500 million, and that this will be our first entry into the market. He left the impression that he would only be borrowing....
HON. MR. BARRETT: We hoped that we wouldn't be borrowing.
MR. PHILLIPS: Oh, he hoped. Well, there goes some more of the Premier's inability, as Minister of Finance in this province, to forecast what he is going to require. So he says that we'll ask the Legislature for lots, we will probably spend all of it and then come back and ask for more.
But there was another statement that the Minister of Finance made on June 18, 1974, a statement which to me is very significant because on June 18 last year we were talking about borrowing money. The Premier says, and I want you to make specific note of this, Mr. Chairman:
There is no way this government will move from essentially conservative financing in North America.
Less than six months later the Premier is borrowing money in an undisclosed country, one of the OPEC countries, proceeds to involve the leaders of the opposition parties in a conspiracy of silence and does not advise where the money is coming from — after making the statement that he would not move from the normal, conservative financing in North America.
I ask you, Mr. Chairman: how are we to trust the words of this Minister of Finance when he endeavours to mislead us in the methods that he has used in the past year?
If the Minister of Finance had been capable and had looked after the money that has come into the Treasury since he took over as Minister of Finance, we wouldn't have to be passing this type of legislation to borrow these vast sums of money. In two years, the 1973 budget and the 1974 budget, this government overspent their budgets by some $719 million — close to the additional amount of money for which he is asking authority of this Legislature to go and borrow at the present time. This concerns me, Mr. Chairman. Had he had some discretion in spending the taxpayers' money, we wouldn't have to move into the financial markets outside of British Columbia and outside of Canada to borrow the amount of money we are having to borrow.
[ Page 2477 ]
Mr. Chairman, I just have to think that when the Premier says that the government is going to use $350 million of the additional gas revenue to build an oil refinery, it's not because it will provide any more jobs for British Columbians but because he wants to build up his own ego and his own power by having control of an oil refinery.
I realize that you are moving to the mike, and your hand is close to the gavel, but I notice you allowed a fair, wide range on the debate when the Minister of Finance was on his feet. As a matter of fact, he was talking about something that concerns him greatly, the political situation of British Columbia at the present time. He spent quite some time on that. I notice while he was speaking, most of his cabinet were absent from their seats because they were out in the caucus room having a game of Monopoly or musical chairs, I guess it was, so they could determine who is going to be where after the cabinet shuffle at the end of June.
We know the cabinet shuffle is coming, Mr. Chairman. I don't know where you are going to fit into the situation. We know that the Minister of Mines and Petroleum Resources (Hon. Mr. Nimsick) is going to be retired from that job because the Minister of Finance is quite unhappy with the way he has handled the mining situation. The easy way out for the Minister of Finance and Premier is to shuffle him out of that position entirely.
MR. CHAIRMAN: Order, please. We do allow you some latitude, but I think the Hon. Member should attempt to relate his remarks. Actually, the reason I was going to interrupt was that I thought the Hon. Member was becoming a little bit personal. I was going to caution him on that point.
MR. PHILLIPS: I wasn't becoming personal at all.
MR. CHAIRMAN: Would the Hon. Member proceed?
MR. PHILLIPS: No, no, I wouldn't want you to allow me to become personal after having allowed the Premier to go off on a political tirade and back to his usual form, Mr. Chairman. He must have regained his feet during the convention over the weekend. Being among his own, he feels secure again. Out there in the general public, I know he feels quite insecure because they don't particularly like him anymore as Premier of the province, and this bothers him.
As I say, I am concerned about what we are giving this Minister of Finance. After the statements made last June, when he was asking to borrow an additional $500 million — it's stated right here in Hansard, Mr. Chairman — he stated that we would only be borrowing $100 million to get the Peace River project underway.
Then he went out immediately and went into the New York market or the Boston market and borrowed $200 million and then went to the undisclosed sources in the OPEC countries. I'd just like to quote to you again, Mr. Chairman, from Hansard of last year where I am speaking and I ask:
What is going to happen in the future? Are we going to have to pass bills to borrow money or put the taxpayers' money into the forest industry that this province is going to take over and the transportation industry that this province is going to take over and, Mr. Chairman, into the mining industry that this province is going to take over?
We haven't moved in those directions but we're going into an oil refinery, Mr. Chairman. The money that's going to be used for that oil refinery is going to be borrowed money, because the money coming from the increase in the price of natural gas should be funnelled into B.C. Hydro. It wouldn't be necessary for the Minister of Finance to indebt the taxpayers of this province for heaven knows how many years in the future. They are the ones who are going to have to pay the interest. We had an increase last year in the price of hydro, which is another tax on the people of British Columbia; we had an increase in the price of natural gas, which is another tax on the people of British Columbia. Taxes are going up everywhere you look around British Columbia under this administration, simply because the government wants to take their money and they want to put it into oil refineries, they want to put it into steel mills, they want to put it into the lumber industry, they want to put it into land. That money could be available to meet the commitments we have for the expansion of Hydro.
I'm just concerned, Mr. Chairman — we discussed this last year. The Minister of Finance has not provided us with a prospectus as to what this money is going to be required for. He talks about the prospectus which was made available to the money markets in New York, yet he hasn't made the same information available to this Legislature. I think the Minister of Finance has a commitment. You should provide it — not the same prospectus that you provide to the New York money market. We want you, Mr. Chairman, through you to the Premier, to tell us where you're going to use this money. The questions have already been asked: how much, where and at what interest rate? The Minister said that he would endeavour to borrow the $100 million at the lowest interest rate available. Yet he went into the market last fall at a time when interest rates were the highest in the world and committed the taxpayers of British Columbia to pay back this high interest rate. Mr. Chairman, we've just lost a lot of faith in the ability of the Minister of Finance.
I don't know what good it will be, because he says one thing and goes off and does something else, but
[ Page 2478 ]
I'd like him to tell us just when this money will be borrowed, when it'll be required, how much of it will be spent where and how much interest rate he intends to pay. Tell us the story! Let the light shine in! He promised open government when he was running in 1972. He promised open government. Where is it? Why doesn't he give us the facts and figures?
I'll resume my seat in the hope that maybe the Minister of Finance will let a little light shine in on this blank-cheque legislation.
MR. L.A. WILLIAMS: Mr. Chairman, I can understand the concern which is being expressed to you by Members of this committee when considering increasing the borrowing power of Hydro by $750 million. The Member for Oak Bay (Mr. Wallace) expressed his concern very well, but I think the Members of the committee should put this increase into proper perspective. If the Member for Oak Bay and other Members of the committee are concerned about the $750 million, then listen for a moment and recall what the Premier said in response to questions posed to him earlier in this House:
We are currently raising the borrowing power of B.C. Hydro to $3 billion.
But the Minister made it clear that the capital projects of B.C. Hydro for which they are already committed and which he named — the completion of the Columbia Site 1 on the Peace, the Pend-d'Oreille, the Kootenay Canal and other somewhat minor projects comparatively — are going to involve the British Columbia Hydro and Power Authority in additional capital commitments by the end of this decade, about five years away, of $3,385,000,000. That's more than double the total borrowing power that B.C. Hydro has right today.
MR. L.A. WILLIAMS: 1982. That's even a better year. Seven years from now — seven lean years — where we're going to more than double the borrowing power of B.C. Hydro.
There are $3,385,000,000 additional dollars that we have to find. We are going to have $677 million from their own operations, generated by Hydro, and $2.7 billion from borrowings. Now we're talking about $750 million. Over the next seven years — $2.7 billion. That means that successive Legislatures are going to be faced with bills such as this to the tune of $2.7 billion. I think that when we are considering this particular increase and contemplate that these projects for which this money is required are already committed — there's nothing new — we must pause and concern ourselves about where we're going.
We must concern ourselves about the openness with which B.C. Hydro functions. It's true that public accounts now has somebody from B.C. Hydro available to them to talk about expenditures already made. It's true as well that an opposition Member is the chairman of the public accounts committee. But the enormity of this problem is too great to be solved with those two mechanisms. I agree with the Second Member for Vancouver–Point Grey (Mr. Gardom) and with the Member for Oak Bay (Mr. Wallace) that it would be nice to have an auditor-general. But this problem is even too big for an auditor-general; he would have enough to do with government departments alone.
I would like to draw the attention of the committee to what took place in another province which has a publicly owned hydro system — the Province of Ontario. Back in 1971, when Mr. Robert Taylor became the chairman of Ontario Hydro, the government undertook a major study into the operation of that hydro-electric power commission. A steering committee was established, a seven-man steering committee, and this study group was requested by the Ontario government to review the functions, structure, operations, financing and objectives of the Ontario Hydro Commission.
[Mr. Rolston in the chair.]
They have completed their task. One of the interesting things, Mr. Chairman, is that in the course of this review they made 100 recommendations, about 50 of them having been accepted now by the Ontario government. One of the recommendations accepted was the matter of a public and formal review of rates which the commission could charge. Following that review the procedure was established which has now been in operation through the first rate increase of Ontario Hydro. The procedure was, first of all, that the Hydro directors determine what they believe is the rate increase they require.
MR. L. A. WILLIAMS: It was a seven-man steering committee — "Task Force Hydro," it was called — and it was established by the Ontario government. Now with regard to rates, the directors of Hydro determine what the rates should be. They are then submitted to the Minister of Energy of the Ontario government. He then turns that request over to the Ontario Energy Board for detailed consideration. The energy board then comes back with its proposals which it issues to the Minister of Energy and the Hydro board.
I am reading from The Financial Post of April 26, which was an interview of Mr. Taylor, and the report states:
"Last year this particular procedure was followed for the first time, and Ontario Hydro accepted most of the energy board's
[ Page 2479 ]
recommendations. What will happen this time when the requested rate increases are to be so high and this process is currently going on may be quite different if there is a divergence of opinion between the energy board and Hydro."
Mr. Chairman, we have an Energy Act in the Province of British Columbia which has established the B.C. Energy Commission. While I may disagree with some policy directions which have been taken by the chairman of the commission and, under his chairmanship, by its Members, let me say that in all of my discussions with the commissioners and the senior staff at the B.C. Energy Commission, they are first rate. They are completely non-political and they are doing a job that was given to them, a most difficult job, by this government. I suggest that any Member of this House, from any side, can approach the chairman and his senior officers and they will give you direct answers to direct questions, and they will help you to understand this massive problem that is facing this province.
Indeed, some of the things they say are critical of the government; and they don't hesitate to say so. That's the kind of group that we need to examine into any of these decisions which are being made by British Columbia Hydro and Power Authority.
HON. MR. BARRETT: Never had it.
MR. L.A. WILLIAMS: For too long British Columbia Hydro and Power Authority, from its very inception, has been a closed corporation in every sense of the word. I find it unfortunate that the present government has not really opened it up. This is one way and this is one time when such action could be taken — when we're facing the prospect in the next seven years of spending and borrowing more than double the current indebtedness of that corporation.
If this government would make this move, it would, I suggest, resolve a lot of the difficulties that are facing the people of British Columbia. Because at the same time as considering the operations of B.C. Hydro — its structure, its borrowing, everything — the B.C. Energy Commission could also bring to Hydro's attention, and perhaps exercise some influence on this matter of energy use and conservation. That truly must be one of the major problems facing British Columbia, the other jurisdictions in Canada and, indeed, all of North America and the world.
One of the reasons that I am so concerned about this matter and am raising this question during debating $750 million, which is miniscule compared to what we'll face over the next seven years, are some of the statements made by the chairman of the Ontario Hydro Commission when discussing his problem and the way in which they have solved it. We have to expend, as I say, $3.385 billion in the next seven years. Ontario Hydro, with its bigger industrial base and bigger population, is facing the expenditure of something like $23 billion in the same period of time. The chairman of their Hydro commission is extremely concerned about the rate structures that they will have to develop with Ontario Hydro in order to allow that capital expansion to take place and to provide them with revenues which they must have to support that kind of borrowing.
Mr. Taylor, in this article, says — and I am quoting because it's in quotes:
"We are making an application to the energy board for one of the biggest rate hikes in Hydro's history. It is very difficult to achieve public understanding of the reasons why they are necessary. The chief reason is that we are having to build so many power stations to keep up with the provincial energy demand that is growing at an extraordinary rate."
That's the problem we face here. The government and B.C. Hydro are going to have a difficult time to make the people of British Columbia understand, if we are going to have rate increases, the need for those rate increases. All the more reason that we should have B.C. Hydro, with regard to its natural gas and electricity rates, subjected to the examination of the B.C. Energy Commission in the same way that any other utility operating in this province is obliged to comply.
Ontario Hydro, like other businesses, faces increasing costs of labour, equipment and operating expenses due to inflation but, in addition, Ontario Hydro, like B.C. Hydro, is facing another massive cost: that is the cost of borrowing money. It's a cost over which we have no control.
The Minister of Finance (Hon. Mr. Barrett) is confronted with the direct obligation over the next seven years of finding $2.7 billion. If we could finance it from our own funds, we would still have to charge an appropriate interest rate or else the source of those funds would, indeed, be cheated. If we have to go to the public market, we have to meet the rate in the public market. It's something over which we have no control. Therefore, the borrowing of $2.7 billion bears with it a cost which is incapable of determining in advance, as each time we go to the market, whether it's the public market or to our own private pocket, we have to face this massive borrowing cost. Therefore, the $2.7 billion that we borrow is itself inflated by this additional cost. The repayment of the moneys, year after year and decade after decade — principle interest — is a cost that must be borne by B.C. Hydro and, in the final analysis, by the people who use its services and pay its rates.
Ontario Hydro, when it goes for rates, is subjected to certain very stringent tests. They have a twofold task. They have a debt-to-capital ratio of 80 to 20. They try to maintain that. They've been doing their
[ Page 2480 ]
best to do so. They also try to see that their revenue-to-interest ratio is 1.35 to 1.
With the scant knowledge we have about the operation of British Columbia Hydro, we don't know whether they attempt to maintain a debt-to-capital ratio similar to Hydro. We don't know what their revenue-to-interest ratio is. That's all behind the boardroom doors of B.C. Hydro.
Therefore, Mr. Chairman, while it may seem insignificant to talk about borrowing $750 million, this is the time for the government to do it differently for B.C. Hydro. This is the time to open up Hydro to the scrutiny of an organization which has the staff, the time and the ability to look into that corporation and tell the government and, through the government this Legislature, where we are going.
I don't think that the government is asking us to increase the borrowing power of B.C. Hydro by $750 million in the dark. They know exactly what is committed. We may not have all the information as to exactly where dollars are going, but we know where they are going to be spent. I mean, $750 million can just go to the Columbia River foul-up. But we know all the other projects are going on. Site 1 is underway. The Minister advised us a year ago. We know the engineering is being done. We know what is happening on the Pend-d'Oreille. You don't do it without dollars.
But I would like to know, Mr. Chairman, that this and future Legislatures, when faced with the problem of borrowing the other $2.7 billion, are going to be certain that B.C. Hydro has done its job properly and mistakes aren't going to be made. As critical as we may be of the former government with regard to the two-river policy, the difficulties on the Peace, the Columbia and everything else, the decision was based on some kind of advice. We don't know yet whether the advice that our government today is getting is any better than it was before.
HON. MR. BARRETT: Mr. Chairman, through you to the Member, I want to say that that is one of the most rational statements that has been made in this debate, and perhaps one of the more rational statements made in this House in the past few years. Unfortunately, both on the government and opposition sides, there has been a tendency to become involved in recriminations of what existed in the past, attacks back and forth about where we are going in the future. Yet what I've tried to say, perhaps not too clearly, but nonetheless as best I can, is that whether it is us or anyone else, what we're talking about now — and it's $750 million, as the Member pointed out — is committed money. Whether it was us or anyone else, they are locked in.
What you had to say has a great deal to commend itself. We have been deeply concerned over the fact that we did not inherit any instrument at all to evaluate government policy at an arm's-length basis. When the B.C. Energy Commission was proposed, I would refer you back to the debate at that time when the Hon. Attorney-General (Hon. Mr. Macdonald) stood in this House and tried to cautiously explain why the old Public Utilities Commission had long ago outlived its usefulness and it was necessary for us to catch up, in effect, with the modern age. The Attorney-General, with great difficulty, got the bill through the House and we did manage to put together, under Dr. Andrew Thompson, a staff of, I must say, internationally recognized people in their own field who have given this province a first-class service from the energy commission.
At this present moment our first move with the energy commission and the kind of public hearing you are talking about is taking place. The commission came into being in 1973. They were instrumental in giving us the first, in terms of priorities of what we are faced with.... And remember, Mr. Member, what you said is correct: this is committed money. The other area of immediate priority was in the natural gas area, and the fact that we were selling it as cheaply as we were. I want to refer to the Member for North Vancouver–Capilano (Mr. Gibson) about the energy price, comparing the asking price to the real value.
The first thing we asked the energy commission to do was give us help in the natural gas field. We like to take credit for what we have done in the natural gas field. Mr. Member, I have to say that despite the official opposition's emotional, lengthy and hysterical attacks on the energy commission, we have been successful with the National Energy Board and with the federal government, putting aside the politics, to come up with a reasonably good price for the export of natural gas, based on hard facts that the Government of British Columbia was able to deliver for the first time.
I think it's an unfortunate criticism that appeared in one of the newspapers, that last time we appeared at the energy board the material was presented as if the Premier had conjured it up, when in actual fact Dr. Thompson was there and Mr. Lechner was there. Many other jurisdictions would give their eye teeth to have that staff available to them. I think it's an unfair, unwarranted criticism in one of our newspapers to suggest that we went down without adequate preparation. It wasn't NDP, Liberal, Conservative or Socred preparation; it was the work of highly skilled technical people that that Member has so rightfully praised today. I think the Member has pointed out a major gap in that we did not have an energy commission.
Now the energy commission is holding hearings similar to what you're asking for, and I find a great deal of your argument attractive. Very attractive. The
[ Page 2481 ]
energy commission is now holding hearings on natural gas this very...well, I don't know when they quit, perhaps at five, but today they were holding hearings. That is their first broad move in this regard.
We have had, as I say, the advantage of having Mr. Minty go in and do one quick look at B.C. Railway, one quick look at B.C. Hydro. It was obvious that B.C. Railway had to be the priority; that's where the move was made.
What you're suggesting for Hydro has a great deal to commend itself, and I expect that there will be moves made in that direction.
Your analysis of the kind of money demands that are faced by the province are absolutely correct. I want to say that it was encouraging to see that somebody is sitting down in this House and rationally plotting, with the information that's already at hand, what we're obliged to do in this province, and contrasting it to Ontario and the $23 billion that they are faced with. You can understand that we are, along with Quebec, Ontario, Manitoba and other provinces, going to be pressuring the world markets for more and more and more money. They know it.
Unfortunately, we have not yet matured enough as a nation to do centralized borrowing. Mr. Member, I'd like you to consider the kind of leadership that could be given in that regard to the Bank of Canada. But putting that aside — and how quickly one could dissolve into a political debate about the use of that instrument — just as a concept, I'd like to throw it out that collective borrowing by all the Canadian jurisdictions would have a great advantage through the Bank of Canada.
We have to take the advice of the federal Minister of Finance (Hon. Mr. Turner). The federal Minister of Finance made a statement in the House of Commons urging the provinces to go to the OPEC nations. He urged that. As a matter of fact, Quebec was the first to make the move. We were second. It is only reasonable, in the light of the demands that exist in the Canadian provinces for that additional capital, that the world's markets, hopefully, will compete. We've got two good borrowings out of those Arab nations, and all the information, as I've already said, is public.
Our debt-to-capital ratio is available through the annual report of the B.C. Hydro. It is there.
The kind of information beyond what you're suggesting, Mr. Member, does commend itself to this government, and we will take a very serious look at the Ontario Hydro approach, even if it is just to do as you said — do some public interpretation of where we are in terms of the growth problems that exist in this province, regardless of political labels. Even if it does that, it will be a great help to the people. But it also requires a degree of responsibility in political debate that, unfortunately, is lacking in this province. It is not right for the official opposition to make some of the statements that they are making in light of the very speech you made today. I think your statement, beyond your own political situation, is an excellent statement — as you said yourself, beyond politics — of where we are today. By 1982, in terms of the commitments we have, we have to almost double the borrowing figure. And we have to compete with Ontario; we have to compete with Quebec. There is no turning back.
The one hope that exists, in terms of limiting us to the $3 billion at this point, is that weathervane that the B.C. Energy Commission is holding out, saying that their projections are less than Hydro's. Now that's the first sign we've had. That's the first information we've had, other than advice we received from Hydro, telling us what the projections are.
There was absolutely no instrument that we or any other group governing this province had to measure Hydro's demands against until the energy commission was created. The first indication we have had has only come within the last 12 months. I hope Thompson's predictions are right. I hope Hydro can be scaled down. But there is no way we can go back on what we have already described in this $750 million. We are committed to the completion of Mica, the installations and construction — what is left of transmission is going to take $250 million, in answer to your question. The completion of the installation, Mica, the construction left, and also those transmission costs, are going to cost over $250 million.
I have to be political just for a moment. When the Member for South Peace River says he was not in this House to hear the debates on the Columbia River treaty, I would ask him to just ask for the press clippings out of the legislative library.
HON. MR. BARRETT: No, the press clippings don't give you an absolutely accurate detail of every word that went on here. We didn't have a Hansard in those days because of a certain government.
HON. MR. BARRETT: No, not my distortions, Mr. Member.
MR. CHAIRMAN: Order.
HON. MR. BARRETT: Not my distortions.
MR. SMITH: You should be thankful we didn't have Hansard.
MR. CHAIRMAN: Let's have some order here.
[ Page 2482 ]
HON. MR. BARRETT: Mr. Chairman, please: not my distortions. It was the former Premier who said, "Nothing is freer than free, my friends," when he talked about the Columbia River treaty. So don't tell me about my distortions. I have to refer to you what is a matter of record in terms of what we were told. We were told that without those transmission costs there would be enough money out of the Columbia River treaty to pay for the project. We were told those words.
Mr. Member for South Peace River (Mr. Phillips), I know you weren't here then, but it would be wrong of you to leave the impression with this House that somehow these things were not said, because they were. We were told what the consequences were going to be. Now I tell the House that the final costs yet to go out of this money on the Columbia is $250 million to complete the construction of the Mica and the transmission. The site 1 diversion tunnel will come out of these funds and also the seven-mile construction work on the Kootenay Canal plant.
On the question of the further $2.7 billion, hopefully there is room for us to make some choices. The Member asked about Hat Creek coal. The engineering information that was available was mostly done prior to the takeover. Of course, the engineering technology and ability has improved dramatically since that time, but costs have gone astronomically out shape from where they were in '61. I suppose anybody could say that had we moved on Hat Creek at that time, we would have been in much better shape in terms of the projected capital costs. It is hard to say. It is really hard to say. I think you could have yourself a real dingdong political battle over it but it would be hard to prove one way or the other.
It was at that crossroads that we were faced with the decision that was made by the government of the day. The government of the day decided to go Columbia-Peace. B.C. Electric wanted to go Hat Creek first and then later on with the rest. The rest is history.
As I say, the first scaling away from the demands presented by Hydro as a fait accompli, because the nature of the body of Hydro itself was that it had no governor on it.... It presented us with tremendous demands as soon as we were in office just as they had the previous administration. All they did was change the date. "This has got to be done. This has got to be done. This has got to be done." For the first time, a government asked Hydro to prove it. They said to us: "Prove otherwise." We had no instrument to prove otherwise; thus, the B.C. Energy Commission. Thus, as the Member says, the next logical step is the direction he says we should go in. Whoever makes those decisions other than what we are obliged to finish has only three choices: further hydro development, the use of fossil fuels, or nuclear.
This government has taken the No. 3 option out.
It is not fatal. If a future government wanted to change that position, then, of course, they must present their arguments, their reasons and their case to the people at that time.
But we have ruled out the nuclear option. Our next move, then, was to maximize, while we gather information, the potential development of those rivers that have already been started. That's why the choice of Site 1, which was so obvious a choice. It wasn't as painful as the other choice of the Pend-d'Oreille and the Seven Mile.
Okay, we've got that. I would say we've got about a three-year breathing space at the most. I want to publicly thank Dr. Cass-Beggs for stepping in in a vacuum period in B.C. Hydro. He agreed to come, and stayed two years, and has done, I think, a great public service for the people of British Columbia. He hasn't agreed entirely with our policy. We haven't entirely agreed with Cass-Beggs. It's the same with Dr. Andrew Thompson. We have not hired people to give us slavishly devoted answers. We've asked for some leadership and some direction, and I think we got it both from Cass-Beggs and from Thompson.
Now Hydro has to move to the next step. Hydro will look seriously at the option offered by the Ontario experience. I think that's an excellent suggestion, if nothing more than just to keep the public informed of the massive problems that exist, and I certainly intend to ask the two cabinet Ministers who are involved with Hydro to examine closely what Ontario has done in that regard.
One last question that was raised — and I've been skipping between the Members for North Vancouver–Capilano (Mr. Gibson) and West Vancouver–Howe Sound (Mr. L.A. Williams) — is the question of domestic pricing related to the real value of energy. We have taken a position that the real value of natural gas is, at the very least, $2 per 1,000 cubic feet. Now despite all the political rhetoric that went on in this House and in Ottawa when this government proposed a raise in the price of natural gas and we had the hassle and kafuffle, some ill-informed Members of the official opposition said we would never get a price raise. You'll recall that I was joshing them, saying, "But of course we would." Because anybody who does 10 minutes' worth of reading will recognize that what the Member for North Vancouver–Capilano (Mr. Gibson) said about energy values is absolutely correct. Tausig's information is public: $2 per 1,000 cubic feet is minimum.
Yes, we had a lot of fun joshing back and forth about the Idaho court decision.
Yes, we had a lot of fun about the projections of the costs of Alaska natural
gas. But by the time we went to Ottawa, by the time we presented our case, the
federal Minister of Energy (Hon. Mr. Macdonald) knew very well that $2 per 1,000
cubic feet, right now, is the fair
[ Page 2483 ]
energy price, at a minimum, for natural gas.
[Mr. Dent in the chair.]
At this very moment battles are going on between Texas and other jurisdictions in the United States around capped natural gas — already discovered natural gas. The machinery is all in and capped and ready to go in southern Texas close to Laredo. But they will not be brought into the field because they're asking for $2.35 guaranteed wholesale price — and they're going to get it. They're going to get that price. So when we move to $1.40 on August 1, and $1.60 on November 1, the Americans know very well that that's a darn good price. They didn't put up that much smoke when they came up to Ottawa.
What do we do in terms of our own needs? Seventy per cent of our production goes south of the border by way of the 15-year contract we inherited. That 70 per cent will bring us new revenues. Good! Two options with the new revenues: (1) exclusively for operating, (2) exclusively for re-investment; or, taking a bit of both and going both ways — reinvestment and operating. We've optioned for reinvestment and operating, without damaging our own industrial base, by raising that price of natural gas.
Who are we concerned about when we haven't raised that price of natural gas to its true value that you say, Mr. Member, is a goal theoretically? And theoretically I can agree with you. But how can we do that? How can we raise the price of natural gas to $2 per 1,000 cubic feet, which is its true value, to our independent logging operations and our small sawmill operators, and have them compete in the United States market for the same product while our natural gas sells in the United States market at this very day at $1, and by November 1, $1.60?
It's self-defeating in our interest to go to the true value because it would threaten the job base here. Take, for example, one mill in the constituency of Cariboo — the mill in Quesnel which has one of the largest independent operations anywhere. If that mill was faced with expensive dry-kiln operations, with the high cost of natural gas they'd become a marginal operation and the benefit they got from the chip legislation would go right down the tube and they'd lay off people....
HON. MR. BARRETT: Well, okay. Look, just take it easy now. We are talking about gas, the cost of the gas and the relative values. It is deliberate government policy not to ask the true energy value of the industrial user and the domestic user of natural gas at this time in British Columbia. We feel that the domestic consumer deserves a little bit of a subsidy because it's his natural resource.
HON. MR. BARRETT: Well, as we go along. Certainly we want to give a preferential rate for the domestic consumer. But I want to point out to you that if we had not committed 70 per cent of our production to the United States, which, in my opinion, was a dramatic error by the former government, we as a government would have gone directly to the gas consumers of this province, if they used 100 per cent of the consumption, and said: "You are the ones who are using the non-renewable energy source at a higher rate."
But what we have found is that by giving lower cost gas to the Americans, we can't force that price up. We can't. Now you talked about a consumer subsidy. The user of natural gas is already getting a subsidy through a low price.
HON. MR. BARRETT: No, that won't be the way of doing it. It's no use raising the price and giving some money back.
HON. MR. BARRETT: No. What are you going to have — a means test of gas users? I don't see that as being a method.
HON. MR. BARRETT: Well, gasoline covers almost everybody in this province; natural gas doesn't.
HON. MR. BARRETT: Look, at this stage of the game, where we have been able to shift the price of gas up, we have said to the domestic consumer: "We are going to give you some cushion," and to the domestic industrial user: "We have made a decision to help the small industrial user in this province by keeping his lower than what his American competitor has."
How I know this comes as a surprise to you: that a democratic socialist government is the one who made a conscious move to protect those small, independent businessmen. I don't expect you to repeat that publicly because it will damage the hysteria that the official opposition has created. But the actual facts are, just as that Member received a phone call of confusion, there is confusion out there.
So that is the decision related to natural gas: we
[ Page 2484 ]
will not charge that true international BTU value of the domestic consumer or of the industrial user in the province. It's economic determination of our own. When we see the number of people employed in the Cariboo, when we see the number of people employed in the interior — and the margin in tough periods of time may be the natural gas price — then we are not going to sock them that total value. The Member for Dewdney (Mr. Rolston) when he was sitting there — and I don't know where he is right now — pointed out that at the time of severe recession in the lumber field, the IWA in his constituency has maintained almost 85 per cent employment. Part of that reason....
AN HON. MEMBER: It got cut in half in Alberta.
HON. MR. BARRETT: Well, they got cut in half in Alberta because they don't have the same programme we have here, Mr. Minister. But in British Columbia we have been able to keep these people employed, and actually, at a time when unemployment is rising, have a 10th of a percentage or two-tenths of a percentage point drop in unemployment. And one of the factors, Mr. Member, is by not asking that full value. We don't have any long-term options beyond that. That's what we are faced with the information that we have now.
Now we have to ride on other people's backs in terms of research for alternatives because we have no indigenous plan here in this province to base any of our projections on. It was by guess and by golly. That group over there even fought the energy commission.
So that's where we're at. So in taking my seat I want to say that we will continue that lower domestic price industrially, and continue that lower domestic price to the homeowner.
We will give serious consideration to the outline presented by the Member for West Vancouver–Howe Sound (Mr. L.A. Williams). We have come a long way with the energy commission. It's the first yardstick we've had with which to measure when Hydro's come up and said: "We need this, we need this and we need this." There was no way of sort of reflecting on it and saying: "Okay, do you really need it for anything else?" Now Cass-Beggs has given that two-year interim period and we have to look at the next step from there.
The Member for West Vancouver–Howe Sound is absolutely correct. This money is already committed to these projects. It has already been publicly stated, as he said.
MR. FRASER: I just want to say a few words here under this bill to increase the borrowing of Hydro by $750 million. First of all, I was happy to hear that the Premier referred to problems of sawmill operators in the riding of Cariboo, but I will give you my version of that. I think we got a little fiction, and I will try and clear that up with some facts.
He was referring to the price of natural gas and keeping it down. That could well be, and I think that has happened. I am sure the operators appreciate that. But, Mr. Chairman, one thing he didn't relate is that the very power from B.C. Hydro has doubled to them in the last 18 months, and that has happened by Hydro increasing the power rates for commerce and industry and holding them at the residential level. I notice the Premier didn't mention that. That is now causing them a lot of concern.
MR. FRASER: How much concern? Well, it's really making some of the operations not viable any longer, because of the cost of power doubling to them.
I might say another thing regarding natural gas. That very operation, which employs 500 people, Mr. Chairman, is right at the present time installing a burner so they can burn the hog fuel and get away from the natural gas, even at today's prices. They don't consider it reliable. But the Minister of Lands, Forests and Water Resources (Hon. R.A. Williams) hasn't given them any encouragement. They're doing this on their own with their own funds.
There's another thing I would like, getting back to the bill itself. The Premier in reply to, I believe, one of the independents here, or the Liberals.... One of the splinter group, anyway, wanted a breakdown of the $750 million. The Premier, when he was up on his feet the last time, gave in a little bit and said $250 million of the $750 million is going to the Columbia.
I would like the Premier, if he has an opportunity in this debate, to break down a little further than that. He referred to the Site 1 and the Pend-d'Oreille in the Kootenays. But what I am not clear on is that that's $500 million not broken down; and in view of construction and the time it takes to progress construction, I don't think it is a good enough breakdown.
What I am really saying is: how much of the $500 million does he expect to spend until 1976 on Site 1? I don't think he will spend anything like $100 million. The contractors have just got started. They are sputtering around spending $2 million or $3 million, but there is no way they can spend $100 million. So I would like to hear a little further breakdown on the $500 million that he really just glossed over.
The other thing I would like to remark on, Mr. Chairman, is regarding the Premier again saying that everything is on the table regarding borrowing the $200 million from the Arab country. Everything is on the table except the important thing: who are we
[ Page 2485 ]
mortgaged to? The people of British Columbia want to know. That's what we want to know.
I would give the Premier some advice when he has to go out on the market again. You said in reply in this House before that you had to do this as a commitment of the borrowing. Well, Mr. Chairman, I say to the Minister of Finance, the next people that want to lend you money like that...tell them to keep their money. You will not enter into any kind of deals like that, because the people of B.C. don't like that.
I want to get on, Mr. Chairman. Let's get this Legislature adjourned. There's a good hockey game going on. But I want to refer to the deficit on the transit side of Hydro of $17 million.
I feel quite strongly about this. I want to say that I don't mind empty buses running all over the lower mainland, in the transit system of Hydro, whether they are full or empty. These people are entitled to transit, and they are getting it. But what I do not like is the fact that people in the interior of this province and in the north have no Hydro power at all. They sure haven't got any buses, they haven't got any roads and all this government will give from Hydro is $3 million for the subsidy of rural electrification.
We debated this under the Premier's estimates and we go nowhere. The facts are, Mr. Chairman, that the subsidy for rural power electrification in this province has been $3 million for at least five years.
I say to you: what do you think $3 million is worth today if it was $3 million five years ago? It is worth about $1 million. The rural electrification extension in this province consequently has come to a standstill. There are hundreds of miles of rural extensions to make in your riding, Mr. Chairman, the Peace River, and all the rural ridings. Mr. Woody Woodpecker over there won't do a thing about them except say no. All B.C. Hydro will say is no. If they have got the money, they find a formula through which they can stop the extension. They are going about this on purpose to bring rural electrification to a dead stop.
I don't want a reply from the Premier: "Well, how come they are spending the money?" The amount of money they spent to the end of 1974 was some $2 million-odd. Believe it, Mr. Chairman, that is absolute peanuts. People all over the interior of this province are denied power. They've still got candles and coal oil lights. You can't get anywhere with that bureaucracy of B.C. Hydro. The management of Hydro say they've applied to the government to increase the $3 million. Everything is dead because we have Woody Woodpecker here — it goes to his desk and gets buried in the wastepaper basket. I would like to see some action. I'm sure that the Premier will give him the money that he asks for, but he hasn't got around to asking. He doesn't know what is going on in B.C. Hydro because he doesn't read his mail.
I would like to further say, Mr. Chairman, that Hydro rates have gone up in the last two years. The Premier is trying to give us a snow job that they haven't.
HON. MR. BARRETT: No, I haven't.
MR. FRASER: The question I have to him is: when are the Hydro rates going up again? I imagine his announcement will be as soon as we adjourn that they are going up again.
MR. CHABOT: Too soon.
MR. FRASER: To give you another idea of this large conglomerate or whatever you want to call it — B.C. Hydro — the two directors who are on it, the Minister of Municipal Affairs (Hon. Mr. Lorimer) and the Minister of Lands, Forests and Water Resources (Hon. R.A. Williams), are completely inadequate representing the government, in my opinion. I asked the question in this House 10 days ago to show you how Hydro is out of control because of those two directors. Was he going to stop 2,000 truckloads of logs on a Hydro right-of-way — in your riding, Mr. Chairman, by the way — between Telkwa and Terrace? He took the question as notice. I understand now the logs are probably burnt. What kind of nonsense is this when it is brought in a responsible way to a responsible Minister and that is how he handles his responsibilities as the director of B.C. Hydro?
I say to the Premier that that Minister should be relieved from the job of director of B.C. Hydro because he has got his plate full now.
HON. MR. BARRETT: Which one?
MR. FRASER: The Minister of Lands, Forests and Water Resources. The other Minister of Municipal Affairs should be withdrawn from there because he is never awake long enough to know what's going on.
HON. MR. BARRETT: Oh! Oh, you just woke him up!
MR. FRASER: I think that we have to think that there is a large organization there in Hydro and they could care less what the individual wants. They just brush it off for some reason that they dream up and you can't get anywhere with them. You go through the Ministers involved and that is just the same as talking to this carpet. Thank you, Mr. Chairman, but I feel quite strongly about the rural electrification part and I would like to hear from the Premier after the hockey game.
[ Page 2486 ]
HON. MR. BARRETT: To show you how the Premier receives instructions, depending on what the instructions relate to, I move the committee rise, report progress and ask leave to sit again.
The House resumed; Mr. Speaker in the chair.
MR. CHAIRMAN: The committee reports progress and asks leave to sit again.
Hon. Mr. Strachan moves adjournment of the House.
The House adjourned at 5:53 p.m.