1976 Legislative Session: 1st Session, 31st Parliament

The following electronic version is for informational purposes only.
The printed version remains the official version.

Official Report of



MONDAY, APRIL 12, 1976

Afternoon Sitting

[ Page 839 ]


Routine proceedings

Economic Policy Analysis Institute of British Columbia Repeal Act (Bill 14) .

Hon. Mr. Phillips

Introduction and first reading — 839

Oral questions

Admission of secrecy oath to David Brown. Mr. King — 839

Swimming programme for disabled. Mr. Gibson — 839

Senior planner for Islands Trust. Hon. Mr. Curtis answers — 840

Insurance cost of R.C. Palmer school fire. Mr. Wallace — 840

Income assurance programme for potato growers. Hon. Mr. Phillips answers — 841

Appointment of John Arnott as cabinet press secretary. Mr. Lockstead — 841

Keep Women Alive programme. Mr. Cocke — 841

Ladysmith Harbour authority. Hon. Mr. Nielsen answers — 842

Thompson River report. Hon. Mr. Nielsen answers — 842

Vancouver East by-election. Hon. Mr. Macdonald — 842

Camera equipment used by security officers. Hon. Mr. Gardom answers — 842

Point of order

Statements following question period. Mr. Wallace — 843

Hon. Mr. Gardom — 843

Mr. Speaker — 843

Mr. Wallace — 843

Routine proceedings

Budget debate (continued)

Hon. Mr. Curtis — 843

Mrs. Wallace — 847

Special Funds Revenue Recovery Act, 1976 (Bill 7) Second reading.

Hon. Mr. Wolfe — 854

Mr. Stupich — 854

Mr. Gibson — 855

Mr. Wallace — 856

Mr. Cocke — 857

Mr. Macdonald — 858

Mrs. Wallace — 859

Mr. Nicolson — 859

Mr. D'Arcy — 860

Mr. Skelly — 861

Mr. Barnes — 862

Mr. Shelford — 862

Mr. Lockstead — 863

Ms. Brown — 863

Mr. King — 863

Hon. Mr. Wolfe — 864

Division on second reading — 865

Income Tax Amendment Act, 1976 (Bill 9) Second reading.

Hon. Mr. Wolfe — 865

Mr. Stupich — 865

Mr. Gibson 867

Mr. Wallace — 867

Mr. D'Arcy — 868

Mr. Skelly — 868

Mr. Lockstead — 870

Mr. Nicolson — 870

Hon. Mr. Wolfe — 871

Speaker's ruling

Clarification of earlier ruling on adjournment motions — 871

The House met at 2 p.m.

MR. G.H. KERSTER (Coquitlam): Mr. Speaker, in the gallery today I'm very honoured to have the grade 11 Social Studies class from Centennial High School and two of their instructors from the great constituency of Coquitlam. I wish the House to make them welcome, please.

MRS. E.E. DAILLY (Burnaby North): I would like the House to join me in welcoming a group of students from BCIT. These students, with their instructor, Barry McMaster, are taking a course in broadcast journalism.

MR. D.G. COCKE (New Westminster): Mr. Speaker, in the gallery today I note that we're being accorded the watch of the B.C. Medical Association. Mr. Speaker, I'd like us to welcome Dr. William Ibbot and other members of the executive board of the B.C. Medical Association.

MR. G.F. GIBSON (North Vancouver-Capilano): Mr. Speaker, in the gallery today I'd like to introduce Mrs. Betty Aitchison, a friend from Kimberley.

MR. F.A. CALDER (Attin): Mr. Speaker, we have in the gallery Mr. Edward Asp of Dease Lake, which is located in the constituency of Atlin. Mr. Asp is one of the top leaders of the Tahltan nation. He's the president of the newly formed association in that area and also one of our leading businessmen. He is one of the contractors for the B.C. Railway Co. I'd like the members to join me in welcoming Mr. Asp.

HON. G.M. McCARTHY (Provincial Secretary): Mr. Speaker, I'd like the House to join me in welcoming Mr. Dave Bruce, who is a member of the executive of the Automobile Retailers Association and a member of the board of X-Kalay.

Introduction of bills


Hon. Mr. Phillips presents a message from His Honour the Administrator: a bill intituled Economic Policy Analysis Institute of British Columbia Repeal Act.

Bill 14 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.

Oral questions


MR. W.S. KING (Leader of the Opposition): Mr. Speaker, a question to the Provincial Secretary. Does the Provincial Secretary intend to answer questions put to her in oral question period? Specifically will she answer a question as to whether or not Mr. David Brown has taken the oath of secrecy and allegiance?

HON. MRS. McCARTHY: The answer to that question, Mr. Speaker, is no.

MR. KING: On a supplementary, I wonder if the Provincial Secretary would explain why other order-in-council appointments such as Mr. John Wood and Mrs. Joyce Thomas, who were appointed by order-in-council on the same day as Mr. Brown, were required to take the oath and why Mr. Brown has been exempted?

HON. MRS. McCARTHY: Mr. Speaker, it should be explained to the hon. Leader of the Opposition that Mr. Brown is a temporary employee and the other two mentioned are not. As such, he is doing a communications study on behalf of the government and in that capacity did not have to take the oath of secrecy.

MR. A.B. MACDONALD (Vancouver East): Mr. Speaker, I'd like to ask the Premier whether, in the light of what has been said, he wants to change the statement he made to this House to the effect that no unauthorized person saw the budget prior to its release.

HON. W.R. BENNETT (Premier): I'm not going to change that statement to the House.


MR. GIBSON: Mr. Speaker, a question to the Minister of Human Resources. In view of the strong praise by the Minister of Health (Hon. Mr. McClelland) this week for the swimming programme for the disabled, formerly funded by the Minister's department through the Red Cross and now terminated, I wonder if the Minister would undertake to favourably reconsider that programme.

HON. W.N. VANDER ZALM (Minister of Human Resources): Mr. Speaker, that's a matter of policy, and as policy will be decided accordingly.

MR. GIBSON: Mr. Speaker, I have a supplementary.

AN HON. MEMBER: You can't have a

[ Page 840 ]

supplementary on that.

MR. GIBSON: Of course you can.

MR. SPEAKER: Hon. Member, the minister has indicated in his answer that it's a matter of policy, and as such is under consideration. Now can you explain to me why or how you ask a supplementary question on that particular matter when it's taken as a matter of policy?

MR. GIBSON: Yes, sir, I can, because I hope to learn a little bit more about the matter of consideration. I hoped to ask if he had had any representations from his colleague, who obviously favours the programme a great deal.

MR. SPEAKER: It's an improper question to ask a cabinet minister to comment on remarks made by another member of the cabinet, Hon. Member.

MR. GIBSON: I was just asking if he's received any representations, Mr. Speaker — which is in order.



HON. H.A. CURTIS (Minister of Municipal Affairs): Mr. Speaker, on Thursday last the hon. second member for Victoria (Mr. Barber) asked if I was aware if the senior planner for the Islands Trust had recently seen her contract terminated.

Later in the same question period the member rephrased his inquiry to determine if the now-vacant position of senior planner has been advertised. It may be interesting, Mr. Speaker, to note that the question preceded my receipt of the official information from the Islands Trust by approximately one and one-half hours.


HON. MR. CURTIS: Later that afternoon I received a letter from the Islands Trust general trustees. It's in the form of a certified true copy of the minutes of the meeting held by the general trustees on Wednesday, April 7. The minute is to the effect that the general trust requests the Minister of Municipal Affairs to rescind order-in-council 2443 appointing the acting manager planner of the Islands Trust, effective May 1, 1976.

The general trustees in a second letter — dated the same day but a second letter — requested me to approve the appointment of a replacement planner on a temporary basis in the near future, and I have that matter under review at this time, Mr. Speaker. The actual method of selection of a replacement is yet to be determined but would, I suspect, involve or be carried out in the main by the Islands Trust general trustees.


MR. G.S. WALLACE (Oak Bay): Mr. Speaker, I'd like to ask the Minister of Education a question with regard to the fire at R.C. Palmer Junior High School on April 10, where damage in excess of $2 million was caused: will the total cost be paid by ICBC and, if so, what is the figure that the minister anticipates the damage will amount to?

HON. P.L. McGEER (Minister of Education): Mr. Speaker, to the hon. member, the matter is under investigation now and I cannot give a figure at the present time as to the total loss. It was one of these, again, unfortunate incidents of school arson which is such a tragic problem for British Columbians.

Fortunately, Mr. Speaker, we had obtained re-insurance as of March I for losses over $1 million. There is still a premium reserve at ICBC of some $4.7 million which will cover this particular loss, but naturally in view of the depletion of this reserve it's going to be necessary for us to reconstitute that fund. We had hoped it would last until the end of the year, but with this one huge loss that becomes questionable. I would appreciate from hon. members or from the general public suggestions as to how we might curb arson in the schools in British Columbia.

MR. WALLACE: Supplementary, Mr. Speaker.

I'm a little puzzled by the minister's answer. In one part of his statement he said that this particular fire caused damage in excess of $1 million. Is the minister implying that the first million will not be paid by ICBC?

HON. MR. McGEER: The question, Mr. Member, I'd better repeat if the member misunderstood. There is a premium reserve of $4.7 million at ICBC to cover loss under a million. Over a million we have re-insurance which is placed through the firm of Guy Carpenter, and, as I say, we were fortunate in getting re-insurance this year because the experience in arson in our schools has been so bad that there was some question as to whether we could get re-insurance at all.

MR. WALLACE: Could I have a final supplementary, Mr. Speaker?

I'll be very brief. The minister asked for suggestions, and in light of the fact that the building was made of wood without a proper sprinkler system, has the minister made any decision about recommending to school boards that future

[ Page 841 ]

construction use fire-resistant material and a sprinkler system?

HON. MR. McGEER: Absolutely, Mr. Speaker. This school was 17 years old and we have certainly abandoned the practice of building schools that are not fireproof.

As far as existing schools are concerned, however, the cost of installing sprinklers in some cases is greater than the value of the school itself. It's a problem.


HON. D.M. PHILLIPS (Minister of Agriculture): On April 7 I was asked a question by the member for Cowichan-Malahat (Mrs. Wallace) on the status of negotiations with potato growers on a farm income assurance programme.

Answer: a proposal for potato income assurance was received from the B.C. Federation of Agriculture on January 25 of this year. The proposal was reviewed in detail by departmental staff in the field — the potato field. A review has been received from the field staff, and meetings by senior departmental staff were held late last week to consider this report. A meeting will be scheduled in the near future with the B.C. Federation of Agriculture to open negotiations on this matter.

At the same time I was asked a supplementary question with regard to the raspberry income assurance. A request for raspberry income assurance was received from the B.C. Federation of Agriculture on March 20, 1975.


HON. MR. PHILLIPS: The department has been prepared to meet with the B.C. Federation of Agriculture to discuss development of a raspberry programme, although funds are not contained in the 1976-77 budget for this purpose. The industry was advised to make formal application for federal government assistance under the Agriculture Stabilization Act, 1975, respecting the 1975 crop. We understand such an application is going ahead.


MR. D.F. LOCKSTEAD (Mackenzie): Mr. Speaker, I should say I object to the minister taking so much time to answer those questions when they could be tabled.


MR. LOCKSTEAD: My question to the Deputy Premier is simply: was the appointment of Mr. John Arnett as press secretary to cabinet done by order-in-council?

HON. MRS. McCARTHY: Could I just add, in the reply to the member's statement on answers being tabled, that I could say the same for questions — they can also be tabled in the House and answered on the order paper.


HON. MRS. McCARTHY: Mr. Speaker, in answer to the question, Mr. Arnett's appointment was done through the Public Service Commission to the Department of Education, and he has been transferred from that department to the Premier's office — by order-in-council.

MR. LOCKSTEAD: Supplemental, Mr. Speaker: in other words, Mr. Arnett is still a public servant, and he is not on leave from the public service.

HON. MRS. McCARTHY: Mr. Speaker, Mr. Arnett's appointment to the Premier's office was established by order-in-council, following his transfer from the Department of Education.


MR. COCKE: Mr. Speaker, I would like to direct a question to the same minister, the hon. Provincial Secretary. About two and a half weeks ago we asked whether or not the Provincial Secretary was reviewing the Keep Women Alive programme — Dr. Henry Richards. Since then I've noted in the House that they are distributing a three-page circular on the whole cancer investigation they are carrying on, and that is pretty well looked down upon by most of the authorities in the area. Mr. Speaker, I'd like to ask whether or not the Provincial Secretary will give us an answer to that question today.

HON. MRS. McCARTHY: Mr. Speaker, I appreciate that the member for New Westminster wishes to have his point of view aired while the medical association is in the gallery, but I am sorry that at this time I am not able to give him that statement.

I promised to this House that I would report when my staff had a report on the Keep Women Alive project. And that grant was not given to Dr. Richards; it was given to the women's bureau of Keep Women Alive. When I have that report, Mr. Speaker, through you to the hon. member for New Westminster, I will certainly give it at the closest opportunity of the opening of this House thereafter.

[ Page 842 ]

MR. COCKE: A supplementary, Mr. Speaker: is it not true, Mr. Speaker....


MR. COCKE: Mr. Speaker, I'm asking a supplementary — and don't give me the order stuff! The supplementary: is it not true that the money has already been spent in pushing the circular?


HON. J.A. NIELSEN (Minister of Environment): To a question asked by the member for Cowichan-Malahat (Mrs. Wallace) regarding the Ladysmith Harbour, the question asked: have any steps been taken toward the appointment of a harbour authority for Ladysmith Harbour? The answer to that is no, The draft report was circulated among the users and local interested groups for their comments, and the final report is now being drafted.

The supplementary question on the same subject from the member for Cowichan-Malahat — the question: has there been a move afoot to consolidate leases within the harbour? No formal requests to consolidate leases has been received; no new applications have been processed.


HON. MR. NIELSEN: Mr. Speaker, a very quick answer to a question from the member for Prince Rupert (Mr. Lea) regarding the Thompson River Report....

AN HON. MEMBER: Where is he?

HON. MR. NIELSEN: He's not here today, but it's a short answer to his question, a supplementary question. He asked if any environmental groups concerned in the matter of the Thompson River report were shown a draft of the report, as was the city of Kamloops and Weyerhauser.

The answer to that question is no. The only persons who were involved in those early discussions were the two principal dischargers, the city of Kamloops and Weyerhauser.

He asked who authorized the meeting in January between Weyerhauser and the city of Kamloops. The decision to hold that meeting, as I mentioned to the member at the time — I didn't believe it was necessary to have authorization — the decision to hold the meeting was made by the regional director of the Environmental Protection Service, Environment Canada, and the director of the pollution control branch of the Department of Environment.


MR. MACDONALD: I'd like to ask the Provincial Secretary if she is leaving the decision as to the issue of a writ for the Vancouver East by-election to the Deputy Provincial Secretary who is charged with that duty under the Constitution Act.

HON. R.H. McCLELLAND (Minister of Health): It's out of order.

MR. MACDONALD: No, it isn't.

MR. SPEAKER: You're asking a minister to reply on a question of law.

MR. MACDONALD: Mr. Speaker, the question is whether she or the Deputy Provincial Secretary is making that decision.

HON. MRS. McCARTHY: Under the statute it is in the hands of the Deputy Provincial Secretary. But I think the hon. member would like to know that we are awaiting the enumeration which is not yet completed. When it is, that information will be forthcoming.

HON. MR. PHILLIPS: Why did Williams resign? Where is he?


HON. G.B. GARDOM (Attorney-General): With leave of the House, Mr. Speaker, I'd like to respond to a question that was raised to me a few days back by the hon. member for Oak Bay (Mr. Wallace), concerning the utilization of camera equipment by security officers.

Leave granted.

HON. MR. GARDOM: I think, as all members know, it is the duty and responsibility of law enforcement officers in this country to protect the public and to protect property. I think every member in this House will commend our police and security officers for the very difficult and demanding job they are performing, particularly in these days of very high crime.

It is their responsibility, Mr. Speaker, to act within the confines of the law and to prevent criminal acts, or the possibility of criminal acts; and an ounce of prevention, as the saying goes, is a very good thing and it should be practised when necessary.

I'd like to say to the hon. member that there is nothing either unusual or new for the protection of the public for the police to take pictures in as

[ Page 843 ]

unobtrusive a manner as possible when they have received intelligence to the effect that there could be problems, because such films would enable any subsequent inquiry to have a good record of that which happened, and certainly to be an aid in determining the facts and as to whether criminal charges should be laid against any violators. The picture-taking in question is not done in such a way as to intimidate the public, or in any way to hinder peaceful demonstrations, and the police are advised to use caution at all times. It really boils down just to the question of the exercise of good judgment.

Now according to police information received, there was concern expressed by the organizers of one demonstration that problems could arise. I'm informed that the organizers in question were extremely cooperative with the police, and difficulties did not present themselves. The films were never developed and they were subsequently destroyed. After the occasion, the procedure was reviewed at a police board meeting and it was confirmed by the police board meeting and it was confirmed by the police board as being completely proper.

In short, therefore, what we're most concerned about, Mr. Speaker, is the protection of people. In situations where it is felt there could be possibilities of difficulties the procedures in question may be carried out if they are deemed to be warranted.

MR. WALLACE: Mr. Speaker, on a point of order: I don't wish to impose on the privileges in the House but could we have clarification, first of all, about statements by leave following question period, and whether or not we are all agreed that the questioner is entitled to respond to the minister's statement?

MR. SPEAKER: One moment, please.

HON. MR. GARDOM: Your question was to the Speaker, Mr. Member, but the reason I thought I'd introduce this after question period was merely to afford more time to the opposition for question period.

MR. SPEAKER: One moment, hon. members. I think the question is one I should take into consideration, because if a reply is made by an hon. minister outside of the question period, by leave, then we're faced with the situation of reply statements, if that's allowable. If it's not allowable, then I presume the only recourse would be for the hon. member to pursue the matter further in the next question period where the opportunity avails itself.

It is a matter that I'd like to discuss with the Clerks of the House because I can see, with the type of questions asked and quite often the answers being rather long, the ministers, out of courtesy to the House, ask leave to file an answer, which is proper and it doesn't take time from the question period. How much beyond that we should proceed I would like to discuss with the Clerks of the House before I give you an answer, hon. member.

MR. WALLACE: On a point of privilege then, Mr. Speaker could I just say that while I appreciate the Attorney-General's intention, and a very well-motivated one, to save time in the question period, the whole essence of the value of question period, surely, is the immediacy of question and answer. The immediacy of question period, and the value of immediacy which makes it worthwhile is something I hope you will take into consideration.

MR. SPEAKER: Thank you, Hon. Member.

MR. J.R. CHABOT (Columbia River): Point of order, Mr. Speaker: wasn't that question posed as a question of privilege rather than a question in the question period? I thought it was raised as a point of privilege.

MR. SPEAKER: Not if I can recall correctly, Hon. Member. I believe it was posed in the question period to the Attorney-General, but I'll check that out.

Orders of the day

(continued debate)

HON. H.A. CURTIS (Minister of Municipal Affairs): Mr. Speaker, I am pleased to participate in this budget debate and to speak in support of the recovery budget presented by the Minister of Finance (Hon. Mr. Wolfe) just a few days ago, and also, more correctly, I suppose, in support of the motion that Mr. Speaker do now leave the chair.

As other government members have indicated, Mr. Speaker, it is a good budget under the circumstances in which we find ourselves today. It is a document designed to put the province back on track again and permit us to prepare the way for later introduction of those programmes and policies which we enunciated in the campaign last November-December — programmes and policies which we know are desired and are required by the people of this province; programmes and policies which are vital if British Columbia is to prosper, in every sense of that word.

What is most personally satisfying, Mr. Speaker, is that in spite of general restraint and many other pressures, the Minister of Finance was able to accommodate a significant number of the proposals which I advanced to him on behalf of the departments of Municipal Affairs and Housing. I know that he and my cabinet colleagues had hoped to

[ Page 844 ]

do even more for these two departments, but we are off to a good start.

Perhaps in these few minutes I could touch on several points which may be of interest and which will assist all members in the House in assessing some of the policies for the departments of Municipal Affairs and Housing which we expect to flow out of this budget.

First, Mr. Speaker, the Department of Municipal Affairs has just concluded production of an interim revenue-sharing formula for local government in British Columbia during the fiscal year 1976-77. The details of the formula were given a few days ago to Mayor Muni Evers of New Westminster in his capacity as president of the Union of B.C. Municipalities. I am pleased to learn today that the UBCM has referred to the proposal as "a reasonable assistance programme." It is also encouraging to learn that the formula is recognized by the president of the UBCM and, I assume, by his executive as again "a step in the right direction" — action which should have been taken a few years ago, Mr. Speaker.

I would ask the permission of the House to make a few comments on the formula for 1976. I emphasize, of course, Mr. Speaker, that it is subject to the approval to departmental estimates and passage of necessary accompanying legislation. The reason for announcing the formula within the last few days was to provide municipalities — local government of all classes — at the earliest possible time with information which is vital as they prepare their budgets for the current operating year. We certainly didn't want to repeat last year's regrettable experience where sometime in the last part of April the general format was spelled out but the details of the Natural Gas Revenue Sharing Act were not finalized and formally transmitted to the various local governments in British Columbia until much later in the spring. In fact it was in the last few days of June — I am subject to correction, but in the last half of June at any rate.

It was essential, therefore, that this information be sent out now so that municipalities begin to have some idea of where they stand for their 1976 operating year.

Mr. Speaker, as you know, in 1975 a total of $20 million was provided for municipalities and regional districts under the provisions of the Natural Gas Revenue Sharing Act. It provided for distribution of those funds on the following basis: first, a basic support grant to each municipality; secondly, a grant based on the relative operating costs of each municipality; third, a water assistance programme; fourth, a grant to each municipality based on the annual increase in new housing units in that municipality; fifth, special community disparity grants to be made to municipalities; finally, grants to regional districts to assist in the capital costs of waste disposal sites.

The allocation of funds and actual expenditures in 1975 are important, I think, for the record and are as follows. First, the basic support grant — the allocation was $3,450,000 and the actual disbursement $3,500,000; operating costs — the allocation was $8,240,000 and the actual amount was precisely that; under water assistance the allocation was $1,310,000 and the actual amount $1,295,621; the new housing units component — the allocation was $3 million and actual $2,865,300; disparity grants — the allocation was $3 million and actual $3,165,470; and the final component, regional district solid waste disposal — the allocation was $ I million and the actual amount $933,504.

So it came out very close, and we worked on this in the last few weeks of the now-closed fiscal year, 1975-76, to see that the final allocations which were in order were transmitted. Of the full allocation of $20 million, the amount disbursed — the actual money transferred — was $19,999,895. You don't get much closer than that.

AN HON. MEMBER: That's a good programme!

HON. MR. CURTIS: Yes, it's a good programme, Mr. Member, and we're improving on it. That's the next part of my statement. We're improving on it.

As part of vote 151 of the new estimates, last year's $20 million, Mr. Speaker, has been increased to $30 million for local government in British Columbia. This is why I referred a few minutes ago to the fact that I appreciate what the Minister of Finance was able to do, and I know that he wanted to do even more with respect to local government.

It's proposed that the funds provided in 1976 will be distributed to municipalities and regional districts on a formula which differs somewhat to that in effect in 1975. Part of the consideration here was that the Union of B.C. Municipalities in convention voiced very strong objection to the community disparity fund, which provided, as I indicated a moment ago, for the $3 million to be allocated to a number of municipalities, basically at the discretion of the then Minister of Municipal Affairs (Mr. Lorimer) .

We're eliminating this portion of the allocation, and we're going to provide for distribution on the following basis for 1976: two non-allocated portions of the formula involve $3 million for water assistance programmes, as before, and $1,487,000 for housing-start grants. The $3 million for the water-assistance programme will meet the costs of providing a grant to municipalities and regional districts of 75 per cent of the amount of debt-servicing costs that exceed a 3 mill levy in the municipality or, alternately, a specified area of a regional district. This is a continuation, therefore, of

[ Page 845 ]

the programme from the previous year, and it's identical to the formula of funding provided under the Sewerage Facilities Assistance Act.

The housing starts grant will allow for payment to municipalities of $100 for each new housing unit which did not qualify or will not qualify for a grant under the programme to be instituted by the Department of Housing, that particular programme providing a $ 500 grant to housing units qualifying for assistance under AHOP, the assisted home-ownership programme. The $100 grant we feel, Mr. Speaker, will provide funds to smaller municipalities or in areas where density is not a major problem.

Those are then two non-allocated amounts. They will be drawn on as municipalities and regional districts make their requests and carry out the work.

In addition, the following have been allocated to both municipalities and regional districts: a basic grant for municipalities, $4.2 million; a basic grant for regional districts, $813,000; and the operating per capita grant portion of this $30 million only, $20.5 million. The $4.2 million represents a basic grant to all municipalities of $30,000 — that's an increase from last year's $25,000. While it is recognized both by this department, Municipal Affairs, and the UBCM, that this is not too significant in large urban centres, it does provide funds in sufficient quantity for smaller municipalities, and allows these smaller municipalities to provide services or facilities which their understandably very limited tax base would otherwise prohibit.

We've spoken in this debate and earlier of mill rates which are perhaps producing $600 a year or $700 a year, the equivalent of 1 mill, and we recognize that problem.

A restriction will be placed on this grant, and I think all members of the House will find it reasonable, that no amount in excess of 50 per cent of the previous year's general tax levy may be taken into revenue. The balance will have to be placed in a statutory reserve fund for capital purposes, which would require ministerial or departmental approval for expenditure. This is a continuation of a factor in the 1975 grant structure. The $813,000 will provide a basic grant to all regional districts of $30,000, identical to that for municipalities.

Mr. Speaker, there's a restriction on the grant in that no regional district will receive in excess of 50 per cent of the requisition on member municipalities and electoral areas for the previous year. Otherwise, we might indeed find that in the case of a very small and relatively inactive regional district, there would be no need for a requisition on member municipalities and regional districts and we would, in effect, be funding the regional district totally. I don't think that is what is intended in this kind of revenue-sharing.

The remaining $20.5 million will be allocated on the basis of a combination of per capita and expenditure formula and I would caution the House, through you, Mr. Speaker, that this is not what we have come to know over the years as the per capita grant, but this is the per capita portion of the $30 million revenue-sharing which I am speaking of. The expenditure grant portion is going to be based on the percentage each municipality's general expenditure is of the total expenditure of all municipalities and this percentage applied to the funds available.

Now, Mr. Speaker, I want to return briefly to the disparity grant factor which was part of the 1975 revenue-sharing programme and to indicate again, as I am sure the opposition will observe later on, that the deletion of this item will, without doubt, cause some critical comment in some small communities in British Columbia, communities which received the money last year. But I think members should realize that it was an administrative nightmare. While $3 million was allocated under disparity grant, requests totalling $40 million were received. The UBCM was invited by the former Minister of Municipal Affairs (Mr. Lorimer) to assist in assessing all these requests. The UBCM wrestled for weeks attempting to achieve equitable distribution. The senior staff of the Department of Municipal Affairs also made a valiant attempt to achieve some type of equity, and finally, the matter was left — I have the feeling with hands thrown up in the air — to the discretion of the former minister. This confusion and the delay in finally settling how much money went where, combined with a widespread belief that the disparity grant is very difficult to resolve on a completely fair basis — community by community by community — led the Union of B.C. Municipalities, at its September, 1975, conference, to urge that the practice be discontinued. Mr. Speaker, we now concur with that request.

I want to emphasize, Mr. Speaker, that the interim revenue-sharing programme, which I am outlining today, is short-term. Work will commence within the next few weeks to prepare the way for a more permanent sharing of growth revenues between provincial and local governments, and in this preparation, which is going to take a good number of months, Mr. Member, we want to prepare the way for a more permanent sharing of growth revenues. We are going to....


HON. MR. CURTIS: Yes, that will also be looked at, I am quite sure. We are going to involve municipalities, regional districts, the Union of B.C. Municipalities as well as elected and staff representatives of municipalities and regional districts and any other groups or organizations which have a point to make; and, indeed, a number have done so thus far in my ministry. Our target for revenue-sharing is 1977 and I hope all the details will

[ Page 846 ]

be worked out, still recognizing that it's a major task. All details will be worked out in time for implementation by the early part of next year — that is, the provincial government's fiscal year of 1977-1978.

But, Mr. Speaker, no municipality, no regional district in this province should misunderstand our intentions in this regard. We do not intend to enter into a blank-cheque type of relationship. We do not intend, no matter how healthy the economy may become, to simply serve as a money tree for local government. We expect the revenue-sharing concept, and the work which will go into formulating it this year, to be approached on a mature and forthright and very frank basis by both partners. I look upon it as a partnership to ensure that funds are received and dispersed in the most efficient and productive manner possible.

Increased autonomy at the local level must be accompanied by an increased sense of priority at the council, the municipal, regional district and staff levels. So we intend to urge carefully prepared and realistic five-year to ten-year capital expenditure forecasting, not to the point, Mr. Speaker, of mindless inflexibility or simply filling in a form and mailing it to the department, saying, "Well, we've complied with that particular requirement, " but carefully laid out capital forecasting with an understanding of the...


HON. MR. CURTIS: ...general direction in which a municipality's spending will be directed within the following few years.

The determining of this sense of priority in capital expenditures is not always easy because there are special expenditures, special interest groups within each community who attempt to influence — and it's fair game — a municipal council to follow a particular course of action. That's fair enough, as I say. However, if a municipal council is torn between a choice of, say, an indoor recreational facility and a storm drainage or a sanitary sewer programme, then that choice should be given the most careful and objective review. I know, having been through it, Mr. Speaker, that there's far more glamour and community pride in a brand new recreational complex than in essential underground improvements.

Again, park development may be highly desirable and there may be strong public support for it, but the same municipality or regional district may have a more urgent need for improved roads, for better and safer intersections, for more sidewalks, for bicycle paths, Mr. Member, perhaps, or for the elimination of dangerous drainage ditches. Each municipality is going to be urged to step back and say: "Is this a matter of pressure? Do we have a very vocal portion of our community asking for A, when in fact what the community as a whole needs is B?" That's not going to be easy, but that's what we expect of local government.

We intend to take a similar attitude toward an individual municipality's acceptance of growth. In the two metropolitan areas especially, the Department of Municipal Affairs and the Department of Housing will expect all communities to very clearly understand this fundamental fact: there can be no opting out of assuming a reasonably proportionate share of population increase pressures. I think that the federal initiatives now in place and those to be added by the province through the Department of Housing will overcome much of the previously understandable resistance to new development, but again — and fair warning to local government — we shall look to each municipality to assist in casing the present housing shortage and to ensure that there is the best possible accommodation mix.

At the same time — in fact, today would be as good a day as any, Mr. Speaker — I urge municipal councils to exercise even greater control over their spending. Now this is not to suggest that there has been no local concern — no serious concern — over increasing costs at the municipal or regional district level. I again clearly understand, having lived through a few, the agonizing decisions which take place at about this time each year, when a municipal council and senior staff sit day after day, or night after night, or both, in an attempt to hold the mill rate to an acceptable level. It's a tough job for local government, but each municipal council and each regional district in the province should be reminded once more of the opportunity each has in its own community to clearly demonstrate an anti-inflation attitude throughout the municipal structure.

I hope and I expect that we shall see, as an example only, virtually no council member salary increases in this calendar year. While the total municipal budget is affected to a very minute extent by council salaries, it is a high-profile item. We see the headlines: "Council Gives Itself a Raise." That so often sets the pattern for other salary and wage increase requests. Very few mayors, aldermen and regional district electoral area directors in British Columbia are overpaid. In terms of the total hours they devote to the often thankless task of serving a community, it's quite probably a below minimum wage situation but this is not the year for them to attempt correction of a long-standing problem.

Mr. Speaker, the relationship between local governments and senior governments, provincial and federal, is undergoing dramatic change. Municipal government has long outgrown its traditional caretaker image. It has experienced a dramatic — in some cases, traumatic — expansion of the degree of complexity and sophistication of its function and its

[ Page 847 ]

needs and the expectations and demands made of it by citizens. It is calling out for the other levels of government to acknowledge this change and to provide the necessary guidance, assistance and support essential if it is to discharge its duties and responsibilities. Mr. Speaker, this government will respond to that call from local government.

This government also believes that we must end the atmosphere of mistrust between province and local government, and we're going to do that. We're going to create an environment which is conducive to cooperation. We accept the fact that the only way local government can be effective in providing its citizens with the good government they demand and are entitled to is if we at the provincial level are willing to work in harmony and with a clear understanding of the myriad problems that are troubling municipalities now.

The challenge facing the urban centre is universal. In Canada, Mr. Speaker, we are rapidly approaching the position where 80 per cent of our population is concentrated in large urban areas. In British Columbia the tremendous growth rates, especially in metropolitan Vancouver and metropolitan Victoria, provide us with a situation where approximately 65 per cent of the population is concentrated in less than 1 per cent of the province's land area.

Recognizing these and other problems, Mr. Speaker, we have just completed formation of a joint committee with the UBCM, the purpose of which will be to examine the many difficulties related to the establishment of more housing in this province and to make recommendations to the Minister of Housing and to cabinet. I want to acknowledge again, in this instance, the enthusiastic cooperation of the Union of B.C. Municipalities.

This committee will actually function at two levels: the advisory committee will consist of elected representatives from this Legislature and the UBCM; the working committee will comprise staff members from the departments of Municipal Affairs and Housing and the UBCM. The group will be given authority to contact a variety of agencies and organizations, including other departments of the provincial government, school boards, the Urban Development Institute, HUDAC, the municipal section of the B.C. Bar Association and virtually any other organization or group which can assist.

The list of areas to be examined is very lengthy, I won't read all of it, Mr. Speaker. It obviously includes: cost of land; difficulties of servicing land; neighbourhood resistance to change; complexity of zoning and inspection procedures; duplication of inspection at the provincial, regional or municipal level; alternate forms of housing, including mobile and modular homes. I would indicate to the second member for Victoria (Mr. Barber) that we've already started an interdepartmental study of the mobile-home problem. We identified the problem — very easy.

I think that the committee has a valuable service to render to all British Columbians, Mr. Speaker, and I look forward to its successful completion within several months of a major and critical task.

Mr. Speaker, I feel very fortunate in having two provincial portfolios which are closely linked together. Since December 22, 1975, we have attempted to involve both departments from the outset in a variety of meetings and contacts and discussions both interdepartmentally and with municipal councils, regional district representatives, delegations of all kinds and individuals. I don't think this happened too often previously.

In so many cases the problem under discussion, you will know, Mr. Speaker, really involves both departments — Municipal Affairs and Housing. I have found the staff of both departments to be extremely receptive to this joint approach so that one understands what the other is doing and one can contribute to the discussion undertaken by the other. In fact, there are many instances where a comment or a suggestion offered by one senior staff member is particularly helpful to the other. I think that in this way, with this joint approach, we should be able to significantly reduce duplication of effort and provide an even clearer understanding of a question under review.

MR. A.B. MACDONALD (Vancouver East): Shouldn't a backbencher have one of those portfolios?

HON. MR. CURTIS: Mr. Speaker, I mentioned earlier revenue sharing. But most of us in this House recognize that this is just one part of the total relationship between two types of government — local and provincial. We're going to move away from the adversary approach. We're going to achieve a degree of mutual trust and understanding; in fact, I think we could call it problem sharing and solution sharing. We're always going to be keenly aware of the fact that the municipal or regional district taxpayer is also a provincial taxpayer. The people of British Columbia expect and deserve our best effort, no matter where or how or at what level we serve them.

MRS. B.B. WALLACE (Cowichan-Malahat): Mr. Speaker, first I would like to congratulate the speaker who has just finished on his very thoughtful and constructive remarks. I am sure that he will forgive me if I say that it was a welcome change from the last time he spoke in this House. Of course, I don't agree with everything that he has said but I am very pleased to have that very constructive and thoughtful approach presented in this House. It was a very welcome change, Mr. Speaker.

[ Page 848 ]

As I rise to participate in this budget debate I am faced again with the dilemma about which budget I am supposed to be speaking about. I have the first edition; I frankly haven't seen a copy of the second edition which, I understand, is floating around. But, Mr. Speaker, I would like to say that I am very pleased that there is a second edition, because I was very much concerned about the type of dialogue contained in the narrative of the first edition and the possible distribution of that dialogue throughout the market areas of the world, because I did have concern for the financial future of B.C., should that kind of innuendo reach those other areas.

Mr. Speaker, while I am very pleased about the second edition, I am very concerned about the method by which that second edition came into being. I was under the impression that this House, this legislative body, was the final authority in the decision-making process within this province.

We sat in this House and we went through some very hot debate on this very subject, Mr. Speaker. We debated whether or not the various sections that were removed should be removed. There was a petition presented to this House, and you, Mr. Speaker, ruled the petition out of order. You ruled against it on the grounds that there was no slur against....

MR. SPEAKER: Order, please! You are now out of order, Hon. Member, to reflect upon a vote or a proceeding that has taken place and been decided by this House at a previous session of this House.

MRS. WALLACE: Thank you, Mr. Speaker, I accept your ruling.

Well, I am concerned that the budget was changed outside of the House, and I'm wondering how, or by what authority. The Minister of Finance indicated on the floor of this House that he had read of the change in the paper on April 2, I believe it was. He indicated that he read in the news media over the weekend about the question asked about the second edition.

So who, Mr. Speaker, made the decision? Was it the Premier? Or was it some civil servant? Who made the decision and why? When we rose to ask for this change we didn't receive much support from the other side of the House. There have been various reasons put forward for the possibility of this change, but I have a different reason that I would like to present. I watched the cabinet very closely when the budget speech was being read, and I suspect that some of the licorice allsorts in that cabinet (those people with the different colour political stripe) were really the only ones on the government side who were aware of what was going on in that speech — of the breach of etiquette. I noticed that when the Premier led the great round of thundering applause that accompanied every critical comment against the former government, and all the bench-pounders joined in, there were certain members within that cabinet that refrained from joining in that applause. I suggest that those members from former political parties realized the implications that were contained in that budget, and my suggestion is that it was pressure from within the cabinet that caused the change.

Mr. Speaker, I would like to move on to the field of agriculture, as contained in the budget. The Minister of Agriculture (Hon. Mr. Phillips), speaking recently in the House, said that agriculture was a most important industry in B.C. — as goes agriculture, so goes the economy. I agree very much with the minister.

I would point out that there are some 12,000 farmers in British Columbia, and that doesn't include the related industries — the people that are working actually in the field of agriculture in related industries. There are 9,000 actual farmers within B.C. who are making sales in excess of $2.500 a year. The gross agriculture sale last year was nearly $400 million. I submit this is a fairly substantial part of our economy. Not only that, but adequate production of food is a basic requirement of our very existence.

Unfortunately, Mr. Speaker, this government has seen fit to leave the administration of this department to a part-time minister who has, to my knowledge, seemed rather reluctant in the past to actually meet with the farmers of this province, and who has seen fit to move on very few of the income-assurance schemes — one of which he has indicated to me today is under active negotiations, while I'm not quite sure whether the other one is or it isn't, from his answer.

I submit, Mr. Speaker, that a part-time minister is not adequate for the agriculture industry in B.C. During the past three years there's been a complete turnaround of the position of the farmer in B.C.'s economic community, and a start on the road back toward making farming a viable and an attractive industry, as it should be. We must have a minister who has the time, the interest and the understanding to assure this trend continues, not a minister who has no time to meet with vegetable growers when they are facing a nearly insurmountable problem in the whole vegetable industry in the Fraser Valley, when that industry is, in fact, in danger of disappearing. Instead, that minister made a dramatic performance on the floor of this House and berated the former government for not causing the federal government to impose import tax.

Yet, Mr. Speaker, that minister has today expressed little or no support for orderly marketing of farm produce at the federal level. I suggest, Mr. Speaker, that without interprovincial production and marketing agreements there is no possible way to control interprovincial imports. Without those kinds of agreements there is no way the federal government is going to introduce protective tariffs.

[ Page 849 ]

Mr. Speaker, apart from marketing, land cost and land availability is the other most important item relating to farmers, I am worried for the future of B.C. farmers when I see the administration of the Land Commission relegated to the Department of the Environment and the whole future of the agricultural land reserve buried in among parklands and urban industrial use.

I suggest, Mr. Speaker, that the preservation of farmland is a most critical question relative to the continuing development of our agricultural industry. I'm deeply concerned that this has been removed from the jurisdiction of the minister responsible for agriculture.

I suggest, sir, that there will be a heavy pressure put on the preservation of agricultural land. This is happening right now in the Fraser Valley with some 600 acres of land, and that pressure will grow, Mr. Speaker, if, say, the vegetable growers continue to find themselves without income assurance, without protection from imports. Then, Mr. Speaker, the pressure will be very great, and once gone, once covered with blacktop, once covered with large industrial complexes, once gone that land is unrecoverable, Mr. Speaker. I urge the immediate appointment of a full-time Minister of Agriculture, genuinely interested in the welfare of the industry and responsible for all factors affecting the industry, including the agricultural land reserve.

Mr. Speaker, as a woman who, for many years, participated in the work force of this province, I want to speak out on behalf of women. Statistics have proven over and over again that women are not given the same opportunities as men. They are put in dead-end jobs. They are not given the same training opportunities. They do not receive equivalent pay. I believe many of us don't recognize this situation, but we must move to ensure that equality.

I have here a report from the Attorney-General's department and it points out particularly, Mr. Speaker, the lack of training facilities made available to women. It seems one woman and seven men attended executive development training programmes in the Attorney-General's department; and, in government generally, executive-development programmes, six females and 87  males in those training programmes. I suggest that that speaks very poorly for the actual participation of women on an equal level in our society.

We must move to ensure that that equality becomes a reality, not just for women but for all groups within our society. Women are faced with many special problems, not just those related to their place of work, but there are problems in law, in education and in health.

Mr. Speaker, I'm a farm wife and, as such, I represent one of the many groups of women who have been historically denied their rightful place in our society. I submit that marriage is a partnership and the wife should be recognized as a full partner. Her replacement value has been estimate at $ 157,000; this was Dr. Martin Meissner of Vancouver, sociology professor at the University of British Columbia, and he told the supreme court in a judgment that he placed the value of a housewife at $ 157,000.

AN HON. MEMBER: That's reasonable.

MRS. WALLACE: That's probably reasonable, I agree, Mr. Member.

Now, Mr. Speaker, this government gives a degree of lip service to supporting the cause of women, but I fail to see any concrete evidence of this support either in the budget itself, or in the manifestations of the government during the past three months. True, we've had a blanket statement on the floor of this House from the Premier expressing general support of women's programmes, but yet the press report at the time of the women's rally doesn't reflect that train of thought. This was from The Vancouver Sun, March 23, and it says he reportedly admitted that he had read only the highlights of the Berger Royal Commission on Family Law. He was unaware of any day-care needs in Kelowna, and the Premier met most requests from the group with a warning that government had very little money and the pie was very small.

The Minister of Human Resources (Hon. Mr. Vander Zalm) is quoted as having said: "Women make good cooks and housekeepers and should be encouraged in that role."

That's not good enough, Mr. Speaker. The Premier also, on the floor of the House during a rather heated debate on another subject, I think, evidenced what perhaps his true feelings were. He was speaking on April 2, in the morning session, and he was talking about finances. He was talking about young married couples who run up bills and find out that they are contracting more debt than their income, and he said: "The wives always stick a few bills in the drawer and don't pay them." I suggest that that is a slur on the women of this province: "The wives stick a few bills in the drawer and don't pay them."

HON. K.R. MAIR (Minister of Consumer Services): Are you serious?

MRS. WALLACE:Yes, I'm serious, Mr. Speaker.

AN HON. MEMBER: Who said that?

MRS. WALLACE: The Premier of this province said that in this House, and I think that is a direct slur against the credibility of women.

AN HON. MEMBER: Have you ever left a bill in

[ Page 850 ]

the drawer?

MRS. WALLACE: Not and left it there, not to be paid. I suggest, Mr. Deputy Speaker, through you, Mr. Speaker, that there is far more spending done by the women of this province than any other one single group. It's the women that do the accounting in the household and pay the bills and arrange for the economic stability of the family unit. I think a slur like this, that the wives put the bills in the drawer, is just a little bit too much in this day and age, Mr. Speaker.


HON. MR. MAIR: Do you get as much credit as Alex?

MRS. WALLACE: I believe, Mr. Speaker, that this government wishes the women would go back into the kitchen. I doubt if they fully recognize the validity of the recommendations in the brief presented to the members of this House by the women who rallied here on March 22. What were some of those recommendations, Mr. Speaker? The re-establishment of the office of the provincial co-ordinator, Status of Women.

Mr. Speaker, it was most regrettable to me that one of the first acts of the only woman member of the cabinet, was she saw fit to discontinue the Status of Women's office, the co-ordinator for the Status of Women.

I see no provision in the budget to reinstate the committee. I suggest to members of this House that until such a committee is established with an interdepartmental responsibility within government, with responsibility to act as a resource body for women's centres and with responsibility for advising cabinet ministers for co-ordinating government programmes related to women, there is little hope for women to take their rightful place, make their rightful gains. This is one of the first steps, Mr. Speaker.

There are inequalities in law, in education, and in the work arena, and I submit, Mr. Speaker, that token support will do nothing to help women move along the road towards equality and social justice.

Now, Mr. Speaker, I would like at this time to turn to a few items that relate specifically to my own constituency of Cowichan-Malahat. Within the boundaries of Cowichan-Malahat there are, I believe, one of the highest per capita native Indian populations of any riding in the province. Those people are concerned about the land claim issue, Mr. Speaker. Naturally they are concerned, the Cowichans, for example, where a good part of the city of Duncan is built on Indian land. Kulleet Bay, Ivy Green Provincial Park exist on Indian land.

I'm concerned over the remarks of the minister responsible for Indian affairs made in this House this morning, remarks where again he brought up the old dodge of trying to throw the responsibility back on the federal government.

The province of British Columbia is a party — a very full-bodied party — to the Indian land claims here in B.C., the cutoff lands. I suggest that making the federal government the scapegoat for this is just part of the same old skin game.

I'm concerned about the government's attitude in cutting off the royal commission that was created in 1975 to study cutoff lands. Did it ever meet? Where will it go? What will it do in the future? This is the question and, Mr. Speaker, I recognize, as do the native Indians, that commissions do not make final decisions. It is ministers and cabinet members who make those decisions, and I sincerely hope that the door is still open and that this provincial government will keep that door open to negotiations on these cutoff lands.

I am concerned to see that there's no provision in this year's estimates for this settlement, none at all, Mr. Speaker. The native Indians certainly have a right to have some moves taken on behalf of the lands that have been alienated from their reserves, and that is a provincial responsibility, Mr. Speaker.

The native Indians are concerned with more than land claims though, Mr. Speaker, I've had some very interesting and productive meetings with the Cowichan band council which represents some 1,700 native persons. The Cowichans posed some very valid questions on other subjects. They point out that the Cowichans have pumped into the local economy something like $2 million in purchasing power during the past year.

Assuming, Mr. Speaker, that half of those purchases were taxable, that represents $50,000 in sales tax. Now with the 40 per cent increase we are projecting another $20,000. Theirs is a very valid argument when they claim they are not getting a fair return for their tax dollars.

I have here, Mr. Speaker, a letter from Marcel Jutras, the Assistant Director General of Indian Affairs, and he says, in part: "Except for two pilot projects, one in the Kootenays and one in the Vanderhoof area, the province does not provide social services to Indians on reserves. In the absence of these services on reserves, this department had a necessity to set up similar but not as comprehensive a service." He goes on to talk about child-care legislation and he says: "When an Indian child is taken into care the province bills this department at a per diem rate."

I submit, Mr. Speaker, that the native people are not getting a full and just return for their contribution to the sales tax in this province.

Now I'm not suggesting that the province does not contribute anything. They do contribute, but they

[ Page 851 ]

are not getting a fair return for their tax dollar.

Another area — and the former speaker, the Minister of Municipal Affairs (Hon. Mr. Curtis) talked about this and I was very glad to hear him talk about this. I was very glad to hear him talk about this — the new approach and the open mind he appears to have — because in the area of natural resource revenue-sharing there are 1,700 Cowichans living on the reserve, with duly elected chief and band council, charged with providing services for the residents of that reserve, yet they are not able to participate in revenue-sharing.

Just by way of comparison, I'd like to point out the kind of aid received by similar governments. In, for example, Cumberland, which has a population of 1,713, they receive the total revenue from the provincial government of nearly $121,000, or in excess of $70 per capita. Another similar area, Armstrong, with 1,671 population, received $105,724 total revenue or $63 per capita.

I do not suggest that we can reach this goal overnight, but I do not see how anyone can argue against the justness of allowing the native people to share in returns from our natural resources, Mr. Speaker. Surely they were here long before we were. Their band councils were a recognized governing body long before the white people came here, and I think they have every right to participate in the revenue-sharing of a natural product that is inherent in their province.

There's another group that wasn't mentioned by the Minister of Municipal Affairs (Hon. Mr. Curtis), another group which I believe has equal rights to share, and that is the improvement district.

I'm sorry the Minister of Municipal Affairs isn't here, but I'll talk to him about this later.

This is another form of government, a duly recognized government, that should be allowed to participate in the revenue-sharing from the natural resources, because that is a duly elected body with responsibilities very similar to municipal governments, and these forms of government should be recognized.

Another item of grave concern to my constituency, is the Ladysmith Harbour. The Minister of Environment (Hon. Mr. Nielsen) was good enough to today answer a couple of questions I had posed to him.

He referred to the study. It is an extensive and in-depth study of the harbour and is, in my opinion, an excellent report. But in order to fulfil the recommendations in that report, it requires the initiation of a local harbour authority. When that authority is set up there must be a complete spelling out of the specific duties and the specific authority of all federal and provincial bodies involved. The obligations of the private sector must be clearly defined and there must be a firm timetable for both short- and long-term objectives. The method of funding for the rehabilitation of the harbour must be clearly set forth. There must be no room for sidestepping or shelving of responsibility.

I would impress upon the minister — and I'm sorry he's not here — the extreme importance and the extreme urgency of this whole question of the Ladysmith Harbour. To have further delays would be disastrous. It's been specified as a joint-use harbour, but the ecological balance of that harbour is fast approaching the point of no return. I would urge the minister to act as soon as possible on the preservation of that harbour.

I would like to turn now to the question of education. You know, during the election we heard a lot of comment about return to local autonomy.

Oh, the Minister of Education (Hon. Mr. McGeer) is here.

I have in my hand a clipping from the local Nanaimo Daily Free Press over the weekend. This is in conjunction with Dr. Upguard, who is the head of Malaspina College there. Dr. Upguard is quoted as saying:

"In the discussion with the department it became apparent by going through the budget section by section, by approving specific figures for each section, and by earmarking certain increases in the budget, it" — that is the Department of Education —
"was, in effect, taking away a good deal of the college council autonomy."

I would ask the Minister of Education to consider Dr. Upguard's remarks and to review the direction his policy is taking the local autonomy in in the field of education.

Now I've looked a lot at the budget funding: though we say we're getting a 9.4 per cent increase, in effect, it is a cutback, Mr. Speaker. I always think that an example is worth 1,000 words, and I have here the proposed budget for the Cowichan school district for the coming year.

First, I would like to point out that the Cowichan district, contrary to the norm, has an average growth rate of 4 per cent. The south end of the school district is fast becoming the bedroom of Victoria, and that south end growth rate is very, very rapid.

This budget simply holds the line; it makes no provisions for any improvement or any increases other than to accommodate the growth rate. Based on that, the budget comes up with an increase in the operating, or shareable, costs of $2,142,486. Now 9.4 per cent of that increase, which is what the government is allowing, is $873,392. That leaves an increase in excess of $ 1.2 million to be picked up at the local level — either picked up or else you are facing a curtailment in services.

The present mill rate is nearly 40 per cent and it's an economic impossibility to increase that mill rate

[ Page 852 ]

by as much as 7 or 8 per cent, so the alternative, then, is to cut expenditures. I would ask: where do you cut, Mr. Speaker? What avenues are there available in the budget? I would point out that two successive referenda, back in the days when they used to finance schools by referendum, were defeated in that district. The result is that the building policy is very far behind schedule, so we're fighting from under on the capital costs.

There is no way that you can reduce the capital cost. You can't reduce interest, Mr. Speaker; that's a fixed charge. When you get into conveyances, you've got increased costs in licensing and insurance. We have increased costs in petroleum — fuels for those buses. The children are on shift there because of the delayed construction, and as a result of that we're already having children who are walking two and two and a half miles and having days from 7 in the morning until 5 at night. There is just no way you can cut the costs on conveyance.

Repairs and maintenance: the alternative there is to let the schools deteriorate. Again, if you do that, the reduction is a reduction, in people; you're laying off people. You're creating more unemployment.

Operating accounts: well, I would point out that the light and power costs have increased; heating fuel costs have increased. We've seen excessive increases in janitorial supplies, many of which are petroleum-based, so again the only possible cut is in people — laying off people, creating more unemployment, and resulting in dirty and unkempt schools.

That gets us up to the only last category, which is instruction. Can we cut on supplies, Mr. Speaker? I have a list here taken from the school-ordering catalogue, just as a few examples in the cost of equipment for instruction: duplicating paper in 1973 was $2.56 a thousand, In 1975 it had increased to $4.89 a thousand. Scotch tape — $4.11 a carton in 1973; in 1975, up to $7.10. I suggest you can't cut costs in those kinds of supplies.

Science supplies: silver nitrate in 1974, $34; an equivalent amount in 1975, $114. A molecular demonstrating tube $6.42 in 1974; in 1975, three times that amount $18.41. A microscope in 1975 — $89; in 1976, up to $145. A stopwatch — $27.95 in 1975; in 1976 — $44.

Mr. Speaker, there is no way you can cut costs in materials and supplies, so you're right up to the teachers themselves. Within the Cowichan school district there are presently 430 teachers. To absorb the $1.2 billion that we're going to have to accommodate in that area would require a reduction of 85 teachers from the 430.

But it's even worse than that. The school budget runs from January to December; the school year runs from September to June; the provincial fiscal year runs from April to March. As a result of this administrative maze of conflicting dates, the 430 teachers are already there and have to stay there until the end of June. So in reality, Mr. Speaker, in order to conform to this kind of funding for the Cowichan school district, it would mean that we would have to reduce the teaching staff by twice 65, or lay off 170 out of 430 teachers come next September.

Now you know what that will do to the class size. Also, those are more people laid off, more people without work. It means that the schools would return to shift. It means rundown school buildings, and it means dirty washrooms and unkempt grounds. It means layoff of teachers, janitors and maintenance personnel. It means less jobs, more unemployment and a complete degradation of the school system, Mr. Speaker.

I want to turn now to the field of health. I have always been a very firm proponent of preventive medicine. I am very concerned at one of the...well, I'm very concerned about several of the actions of the Minister of Health (Hon. Mr. McClelland) . But one of the things that has come to my mind very recently are letters from public health nurses, copies of letters that have been sent to the Minister of Health, one after the other after the other. I would just read a small part of one letter from the public health nurse in Duncan. She says in part:

"I'm concerned over the present freeze on our staff positions and orders to cut back these positions by 15 per cent.

"I understood you, Mr. Minister, believed public health was a service of vital importance to the health of the people of this province, and the recent outbreak of diphtheria on Vancouver Island as well as the possibility as a dangerous epidemic of swine virus influenza next winter are just a few warnings of what we must constantly be prepared for and protected from through our knowledge and use of preventive medicine."

Mr. Speaker, I am shocked, really, at the fact that the public health scheme is asked to cut back by 15 per cent, because I think that is one of the most vital and essential things in our whole health policy. I am shocked, too, to hear the minister reported on television last night as telling people: "Don't go to the doctor unless you are really sick." Mr. Speaker, preventive medicine is the most valuable and most economic form of medicine there is in this province, this country or in the world, and to have a minister saying that we should cut back on preventive medicine in a province like British Columbia in this day and age is nothing short of a disgrace.

I am concerned, too, that the Alcohol and Drug Commission has seen fit to withdraw the only grant to the area of Duncan. It's been discontinued in the face of the somewhat dubious honour that Duncan has of being the highest per capita user of alcohol in

[ Page 853 ]

the province of British Columbia. That was the only grant withdrawn.

MR. COCKE: Higher than West Vancouver?

MRS. WALLACE: Well, that's what the press says.

I am concerned, too, that we stand to lose our only child psychologist. The Minister of Health (Hon. Mr. McClelland) has suggested that there is another psychologist there and that he can see the children — in spite of the fact that the other psychologist already has a three-week waiting list, and in spite of the fact that the other psychologist is not trained in child psychology. I submit that the few dollars that the minister plans to save is a short-sighted economy. If problems are pinpointed at an early age, the child can receive early treatment and grow and develop to take this normal place in society. The dollars saved at this point are far overshadowed by the costs that society will incur if that child does not receive adequate and early treatment.

As a final point in connection with health, I would like to relate the story of Aaron Jones. Aaron Jones, Mr. Speaker, is four and a half. Two and a half years ago he was a lovely, tow-headed, bright, intelligent youngster. But Aaron Jones had an accident, Mr. Speaker. He fell in a friend's swimming pool, and when he was resuscitated he had irreparable brain damage. This child has been in hospital for two and a half years. He is blind. He is incompetent. He will be there for the rest of his life.

The recent announcement by this government, Mr. Speaker, of the increase in the costs of extended care to $7 per day has worked an impossible hardship on Aaron's family. His mother has sent me a list which indicates that their father is a teacher and their net income is $869 plus $22 family allowance — they have another child — making a total of $891 a month. She lists the expenses one by one. They total $850, Mr. Speaker, and that includes $31 a month to pay the dollar a day for Aaron. They have only one alternative, Mr. Speaker — that mother and that father — and that is to make that child a ward of the state,

Published recently in the local paper, The Crofton-Chemainus Observer, was an open letter to our government. I am sorry the minister is not in the House, I would like to have sent this over to him, but I will see that he gets it. Janet Jones, the mother, says: "We never entertained thoughts of unburdening ourselves of him or deserting him to the state. Now we must. He won't know the difference, but we will; he will no longer be our son." Mr. Speaker, it makes me very sad to think that a government policy is doing that to a mother in my constituency in this province.

Moving on to the handicapped and the Department of Human Resources — and that minister isn't here either — I would like to talk about Lawrence Johnson. Lawrence has been handicapped in a wheelchair since he was two years old. He is now 19. He has been an honour student in Ladysmith school. When the school was changed to Nanaimo he took correspondence. His marks were high. He is now in Malaspina college and he is getting good marks.

Larry had poliomyelitis when he was two years old. He is paralysed in both legs. He wants to continue his education. He applied for a handicapped pension and he was turned down and told that the reason was that when he gets through college he can get a job. Larry is very disturbed by this. He wants to go on. We are trying to help him, Mr. Speaker, but I suggest that it's very thoughtless of this government to create those kinds of conditions, those kinds of circumstances where people are so emotionally overwrought, so heavily disturbed because of the heavy-handed attitudes of this government — and they are heavy-handed, Mr. Speaker.

I don't think the government realizes quite the effect these punitive and retrograde policies are having on the handicapped throughout this province. I had four calls in one day, Mr. Speaker — four calls to my representative in Ladysmith in one day. They were all from handicapped people. One woman phoned to say her husband was 90 per cent disabled. They were on welfare; she had five children. "They are taking the food out of our childrens' mouths, " she said. Another woman, her husband handicapped, was in tears: "We're just making it now. If they cut us down, we can't manage." Another woman was completely disabled. Another's husband is 60 per cent disabled.

Four people, Mr. Speaker, called in one day. When asked to give their names so I might look into the case and try to get them some help, do you know what they said, Mr. Speaker? "I can't give you my name. I'm frightened. I am afraid I will be punished even more." That's what they said, Mr. Speaker — four in one day.

It's a vindictive government out to punish the electorate, I suggest, Mr. Speaker, the Minister of Human Resources (Hon. Mr. Vander Zalm) has infringed on personal freedom to an unprecedented degree, infringed on the personal rights....

MR. SPEAKER: Hon. Member, may I interrupt you long enough to tell you that you are in your final two minutes?

MRS. WALLACE: Thank you, Mr. Speaker; I am nearly finished. I suggest that the Minister of Human Resources more than any one member of that cabinet has infringed on the personal rights, the personal liberties and the personal freedoms of the people of this province. I don't know what runs in the minister's veins, Mr. Speaker, but I'm....

[ Page 854 ]

MR. SPEAKER: Order, Hon. Member! You are suggesting an impugning motive on a minister of the Crown, which I think is improper, I would ask you to withdraw that imputation.

MRS. WALLACE: May I say, Mr. Speaker, that his programmes have infringed on the personal freedoms and liberties...?

[Mr. Speaker rises.]

MR. SPEAKER: Any imputation against any minister of the Crown or other member of this House is unparliamentary. I would ask you to withdraw any imputation of an unparliamentary nature against the hon. minister.

[Mr. Speaker resumes his seat.]

MR. D.G. COCKE (New Westminster): Mr. Speaker, on a point of order, it is customary in this House to criticize a member of the government. That is merely what the member for Cowichan-Malahat was doing. I just can't understand the kind of interpretation that you're placing on this.

MR. SPEAKER: Hon. Member, on your point of order, it is the manner of debate sometimes that results in the Speaker asking for a withdrawal while allowing the matter to go unchallenged. I listened carefully to the words of the hon. member and there was an implication there that I think is unparliamentary and incorrect. I just ask her to withdraw it.

MRS. WALLACE: I will be very glad to withdraw, Mr. Speaker. I have no intention of impugning the minister personally; I was relating strictly to the policies.

MR. SPEAKER: Thank you, hon. member.

MRS. WALLACE: I was just wanting to speak about this question of freedom. I have evidence that there is a great concern about personal freedoms among the people within the constituency — certainly among the ones that I have spoken with. I am gravely disturbed that a government which campaigned on the premise of freedom, on a premise which purported to bring greater freedom to this province, has created that kind of an atmosphere.

Mr. Speaker, I would suggest that we all have different senses of values, but I would suggest that the basic difference in the sense of values between the people on the government benches and here is that the people on that side of the House have a sense of values which relates specifically to the bottom line — the balanced budget, the cash returns, the cash outgo.

I suggest that the people on this side of the House have a sense of values that relates to the well-being of and social justice towards the people of this province. I suggest, Mr. Speaker, being a member of this side of the House, that if that is what democratic socialist government stands for, and if that is what makes me one of the "socialist hordes, " then I am proud to be on this side of the House.

Hon. Mr. Mair, on behalf of Hon. Mr. McGeer, moves adjournment of the debate.

Motion approved.

HON. G.M. McCARTHY (Provincial Secretary): Second reading of Bill 7.


HON. E.M. WOLFE (Minister of Finance): Mr. Speaker, Bill 7, as you have said, is the Special Funds Revenue Recovery Act, 1976, the purpose of which is to recover to the consolidated revenue fund the balances in the special-named special funds on April 1 of this year.

Mr. Speaker, hon. members will recall that in the budget speech I advised that after review the government finds it is appropriate at this time to recover to revenue the balances of some previously allocated special-purpose funds. In this manner the budget can be balanced without tax increases additional to those already announced.

I might say that almost $28 million will be recovered in the following manner: first of all, an amount of $7.3 million from the Provincial Major Disaster Fund; secondly, an amount of $5 million from the Agricultural Aid to Developing Countries and World Disaster Areas Fund; thirdly, $7.8 million from the Power and Telephone Line Beautification Fund; fourthly, $2.8 million from the Green Belt Protection Fund; and fifthly, an amount of $94,792 from the School Tax Removal and Resource Grant Fund. Five million dollars from the Economic Policy Analysis Institute Fund is to be included in a separate Act which was introduced today by the hon. Minister of Economic Development (Hon. Mr. Phillips) .

Mr. Speaker, I would like to emphasize that while the capital amounts of these funds included in the bill are being recovered, their purposes will be continued. You will be asked to approve funds for the purposes within the estimates of the departments of Agriculture, Environment, Education and Finance.

Mr. Speaker, I move second reading.

MR. D.D. STUPICH (Nanaimo): Mr. Speaker, we do have some concern in spite of the minister's assurances that these programmes will be carried on in

[ Page 855 ]

estimates. It's so easy for the government to change its mind from time to time as to just what is going to be in estimates. Even this year, for example, when we look at estimates, we don't really see amounts — at least in my examination so far — that are closely enough identified with the programmes included in these funds that we remain assured, for example, that there will be money in the estimates to cover anything in the event that there is a major disaster, for example. Certainly with the flooding conditions that are quite unpredictable — we might go for several years without any trouble at all, and then have a very bad year — there's nothing in the estimates that can possibly be there to cover that kind of a circumstance, and it's some assurance to know that there is a fund maintained for that purpose.

Another example is the Power and Telephone Line Beautification Fund. It's one thing to say that this year there will be something in the estimates. Again I'm concerned, Mr. Speaker, that there would not seem to be an amount identified in estimates that is clearly identified with this kind of a programme. The telephone company, in some areas of the province, has been doing some work along the lines of burying telephone lines. We certainly think this is a very worthwhile project, and from the point of view of the telephone company it is not money ill spent, in that it is certainly going to be much easier to maintain service when the lines are buried than when they are in the air and subject to being damaged by failing trees or icing conditions or something like that.

We feel that when this fund was there, there was some encouragement for people to embark on projects that would provide for burying both power and telephone lines. They say that there will be something in the estimates to encourage this kind of a programme, but we don't know how much, and we're not even sure how much is identified for that purpose this year, let alone next year, When this fund was set up the Minister of Finance at the time announced his intention of having this fund so that there would be that kind of a continuing project to bury power and telephone lines, and we feel that we're losing the thrust for that programme by wiping out the fund.

The Green Belt Protection Fund. Mr. Speaker, when this programme was first announced I think there was general support in the whole community for the idea that there would be some greenbelts established in areas of heavy concentration of population and along highways. While there was some real concern, certainly on our side of the House, and concern in the community generally about some of the acquisitions of land through the Green Belt Protection Fund under the administration previous to ours, and maybe about some of the acquisitions that were put through by the NDP government, I don't think anybody was concerned at all about the purpose of the programme and the fact that it was a very worthwhile programme.

Rather than see this fund written off or disposed of, and saying that there will be some amount...and I suppose in this case it would be in the Department of Environment, but it is an amount that is not identified at all as a specific. At least my examination of the estimates so far would not see any figure in there that is clearly identified as being for greenbelt protection or for establishing greenbelts.

The School Tax Removal and Resource Grant Fund. Possibly if the legislation were dealing only with that one, and knowing that the previous administration got us so far along the road in that kind of a programme it would be very difficult for any administration to back away front it. It it were just that one, then we would have no concerns about the legislation, but we are very distressed to see the thrust — the psychological effect, if you like — the, effect on the whole community of the idea of pursuing these programmes. We are concerned that this is apparently not going to be endorsed by the government in the way that it would be endorsed if these funds were added to, as opposed to what is being proposed here, and that is to do away with the funds,

Mr. Speaker, we are not prepared to support the legislation in the way it is before us on the basis that there will be some amount included in estimates this year, and may or may not be next year, to continue these kinds of very worthwhile programmes.

MR. G.F. GIBSON (North Vancouver-Capilano): Mr. Speaker, I'll be very brief in speaking on this bill, whose coming up now surprises me a little bit in view of the fact that this House was seized of such urgency by the government on Friday afternoon last on another bill, and now we're bouncing around the bill book....

MR. SPEAKER: Order, hon. member, you're on Bill 7.

MR. GIBSON: Just a little comment in passing, Mr. Speaker.

HON. D.M. PHILLIPS (Minister of Economic Development): Keep your comments to yourself.

MR. GIBSON: That minister is trying to browbeat me, Mr. Speaker. Will you ask him to be quiet? (Laughter.)


MR. GIBSON: Mr. Speaker, the purpose of this bill is to find a little money to put into the provincial budget for this year so that it won't have to be raised by taxation in this unusual year, and that's a laudable

[ Page 856 ]

purpose to start with.

The funds were phony, Mr. Speaker, in the first place. They were just a way of siphoning a bit of money out of provincial revenue in years of surplus and squirreling them away until a time of need came along. They denied access to this Legislature in terms of a year-by-year vote on the purposes for which the interest of these funds were to be expended, and that was very, very wrong in principle. Therefore in principle I support the abolition of funds of these kinds because it returns control to the Legislature.

I would make only one exception to that, and that is in cases where funds are, and should be, set up to provide a kind of an independence to the kind of institution that they are supporting. An example to that is the Institute for Economic Policy Analysis, but even there we realize today that a special fund is of no protection whatsoever, because a bill has just been introduced in this House to abolish that particular fund — introduced today — so we can't talk any further on that one for the moment.

The purposes of these funds are laudable. It is the technique that has been improper, the technique of putting money away in special little funds controlled only by the Minister of Finance and the cabinet rather than by this Legislature. Therefore, I support the abolishing of these funds, with the important codicil that the purposes continue to be supported in the estimates, year by year.

[Deputy Speaker in the chair.]

I would speak especially of the Provincial Major Disaster Fund and the Agricultural Aid to Developing Countries and World Disaster Areas Fund, and I'm quite pleased at this time to give the government congratulations for the money they've put in the estimates for this year for world food aid.

In summary, Mr. Speaker, it seems to me that we have ample protection in the estimates debate to insist each year that these worthy purposes be continued, that we are removing a financial anomaly in disbanding these funds; and therefore I support second reading of this bill.

MR. G.S. WALLACE (Oak Bay): I oppose the removal of these funds for the very simple reason that — and I see the point of view of the Liberal leader (Mr. Gibson) who has just spoken, that the technique might have left something to be desired.... Nevertheless, the reason I so strongly oppose in particular one of these, the Agricultural Aid to Developing Countries and World Disaster Areas Fund, is that the funds at least were there and the interest was being spent, particularly in the agricultural aid fund, whereas the minute you remove this fund it's very unlikely, in my view, that there is any kind of guarantee as the years go by that subsequent governments will remember or take cognizance of this wish of the Legislature in previous years to ensure funding for Third World countries.

In this particular year I notice under vote 4 that there is indeed $350,000 in agricultural aid to developing countries, but there is no question that this is a cutback. I would appreciate participation in this debate from the Minister of Agriculture (Hon. Mr. Phillips) because I've been trying to find out in the course of the last week or so about another $5 million which was made available last year in addition to the $5 million which is in this fund. My staff were just in the process of trying to define exactly how much money had been spent and what the exact status of the other amount of money was.

Presumably it was a one-year grant but at least, whatever the status of that amount of money, Mr. Speaker, it showed that the government at that time was increasingly concerned about providing some greater amount of aid to developing countries and Third World countries.

I know from a meeting as recently as last week in my own riding that there are many people in this province who feel that British Columbia is being niggardly as a wealthy province in the very limited help that it is providing to Third World countries.

We have Habitat coming to Vancouver in June, The whole theme of Habitat is to recognize the shrinking nature of our society and the fact that we are living on a planet where the size is static but the population grows, and the problems are becoming immense year by year. For a province which has a provincial budget of $3.6 billion to be recapturing a fund which provides $350,000 a year for foreign aid, I think is being...I think niggardly is a charitable way to describe the actions in removing this fund.

Now, Mr. Speaker, the answer we'll hear from the government is that the interest will annually be placed in the Department of Agriculture's estimates, but my argument is that we have no guarantee whatever that that will happen year by year, whereas the existence of this fund set up by specific legislation did, at least, give some assurance that the interest was there to be spent. There might be a criticism, as the Liberal Leader (Mr. Gibson) pointed out, that it leaves the spending of the money beyond the scope of this Legislature, and I recognize the criticism in that. But I would rather that the money be there and be spent at the discretion of a minister than not be there at all. I feel that if.... This year we've got the money, yes. But it's, I think, a retrograde step in terms of British Columbia's recognition of its commitment to a wider community than B.C. and wider community than Canada, but to the community of the Third World countries, and it is that particular fund that I regret most of all seeing recaptured in this bill.

The sum we are talking about is $28 million, and I

[ Page 857 ]

just want briefly to refer again to the fact that the budget as a whole leaves reasonable speculation that revenue might be greater than the government is calculating.

Certainly, if we are agreed or believe that the growth in the economy might reach 4.5 per cent, then indeed the projected revenue from personal income tax will be higher than the $815 million which the Minister of Finance (Hon. Mr. Wolfe) has projected, and for that reason I think it's rather.... The government's being picayune in my view to be taking these funds and particularly the $5 million fund for aid to developing countries, when in fact there's reasonable arguments that the revenues from other sources might be much better than have been projected and $28 million is really a very small part of $3.6 billion. Even if they took the other funds but this one, I think it would be some manifestation of the government's commitment to realize that the world doesn't begin and end in British Columbia.

It makes no sense for so many politicians to pay lip service to the concept of the global village and the fact that pollution and population explosion and the armaments race and all the other problems may one day wipe out the human race.... It's no good to pay lip service to these concepts and then when we come to our own budget in our own corner of the world, we become extremely mean and miserable by taking this $5 million fund out of action with the promise that, of course, each year the equivalent in interest will go into the estimates of the Minister of Agriculture. It doesn't reassure me enough that just because that sum of money is in vote 4 this year, it will be there next year or the year after, or at the time of the next government, because regardless of the obvious confidence of our new administration, governments do change.

It seems to me that while I would prefer to see most if not all of these funds left to be handled in the way they have been handled, if one had to at least zero in on the one that causes, in my view, the greatest concern, it would have to be the agricultural aid to developing countries.

There's an amazing passage somewhere in the budget — I just can't pick it out right now — but it refers to.... . It's in the middle of page 32. "The provincial major disaster fund was established at $25 million in 1969. An annual average of $2.5 million has been paid from the fund". The budget goes on to say: "We have been fortunate the disasters have been localized and relatively light in property loss."

For this province that sits not very far from natural earthquake areas to the south of us, and where in fact we have had some small tremors in recent years, it seems to me that that particular statement in the budget is complacency of a high order. I don't for a moment mean to imply that there's any great risk of a major disaster in British Columbia, but just because since 1969 we haven't had something major is not justification whatever to remove the fund from its existence, because what it automatically means is that if we now have a disaster, the funding will have to come out of operating dollars that are available, in much the same way as we've already criticized this government for taking operating dollars to provide capital expenditures of other kinds. I feel, just to recap quickly, that these funds do fulfil a valuable purpose which exceeds the disadvantage that their management is beyond the scope of the House.

Secondly, the sum of money, $28 million, I believe, is an example of the very strenuous and perhaps over-zealous effort by the Minister of Finance to ensure that only black ink appears in the ledger.

Thirdly, there is a reasonable chance that this money is not needed in the next financial year.

Finally, and most important of all, is the example we are setting. Removing the fund for agricultural aid to developing countries creates the impression, rightly or wrongly, that are downplaying or reducing, or giving less significance to our role as a wealthy province well able to contribute a great deal — more than we've done in the past for some of these Third World countries.

So, Mr. Speaker, it seems to me that it's a little bit like the other debate we had the other day about how urgent it is to impose hardship to raise money which may not be needed. It certainly reflects my personal view that while we all certainly would prefer black ink and a balanced budget, I'm sure that if six months through the year the government were to find that there's a lot more than $28 million beyond projected revenue coming into the coffers, this debate would be unnecessary. The funds could be preserved and there would be the clear commitment by this government on behalf of the people of this province that we recognize the need of developing countries and that we are more than prepared, as a wealthy province, to pay our share and meet that kind of responsibility. So I oppose the recapture of these funds.

MR. D.G. COCKE (New Westminster): Mr. Speaker, I'm surprised at Bill 7.


MR. COCKE: Yes, and I'll be particularly surprised at the Finance minister. I'm not surprised at the Minister of Labour (Hon. Mr. Williams) or the Attorney-General (Hon. Mr. Gardom); I'm not surprised at a number of other members over there, but I'm particularly surprised at the old Socred Minister of Finance — oh, how they guarded those

[ Page 858 ]

special funds. Oh, how they voted for them, year after year after year. Under W.A.C. Bennett the most precious commodity we had was our special funds protecting the future of sports, protecting the future of agriculture in other nations, protecting others against disaster. We would set up special funds for everything. As a matter of fact, one day I expected a special fund to be set up for special funds.

Mr. Speaker, why the sudden change of heart?


MR. COCKE: Oh yes, I'll bet you're kind of blushing, Mr. Member. You and I have been sitting here for a long time.

Mr. Speaker, why the sudden change of heart? I'm not going to speculate on that. I won't speculate on why the sudden change of heart. But I don't accept a balanced budget — $28 million that we're sort of moving out. I say that's just utter nonsense.

I'll bet, if this evening you went for a walk with the Minister of Finance, he would tell you that there's only $18 million in cash flow there anyway. At best there's at least $10 million of it tied up in long-term investments, so at best that's a bookkeeping entry. So, Mr. Speaker, I suggest to you that it's just more flim-flam, just more flim-flam that we're beginning to expect.


MR. COCKE: Mr. Speaker, the only word that's in the book, as far as I know, is the Minister of Agriculture (Hon. Mr. Phillips) . I find that....


DEPUTY SPEAKER: Order, please.

MR. COCKE: Mr. Speaker, the Minister of Finance promises that the purposes will be continued. That's all very well and good this year — we look in our estimates books and we can agree or disagree with respect to the purposes. But what is there that's guaranteeing a minister putting forward his particular programme next year? What if the minister happens to be in a bit of a bind and says to himself: "Well, obviously if I'm going to get X, I can't put in Y in my estimates this year." Therefore the particular programme we are talking about could be the Green Belt Protection Fund, it could be the Provincial Major Disaster Fund, or it could be the Power and Telephone Line Beautification Fund. Incidentally, the Minister of Finance told us some time ago that that fund hasn't really been called upon. I think that's a shame because we should be getting on with programmes that are positive, such as that.

Mr. Speaker, I suggest that estimates can freeze in the course of a year. I've seen items in the estimates book in the beginning of the year; you get to the end of the year and it's not spent. So I don't really think that even provides the kind of guarantee we're talking about either.

I suggest to you that this is just another means of providing some back-up for some of the statements this government's been making in their budget, some of the statements they've been making in other bills before the House. I find it very, very hard, Mr. Speaker, to give it much credibility, and I therefore cannot support this bill.

HON. MR. PHILLIPS: Oh, shame!

MR. A.B. MACDONALD (Vancouver East): Mr. Speaker, just a word on the bill. I heartily agree with what was said by the hon. member for Oak Bay (Mr. Wallace), the leader of the Conservative Party, about our role in the world as a rich and affluent province.

It seems to me that we see in this bill not a question of technical accounting — whether it's in a capital fund with the interest going to the programme, or whether it's in the estimates — we see a turning back by this government from social objectives that are spelled out in bills like the Green Belt Protection Fund.

You know, that's the kind of thing that's in their hearts, Mr. Speaker. The present government of the province of British Columbia does not like, to put it very mildly, the idea that private land around the great cities should be brought into the public domain, even though it's a matter of good accounting — that it's a very profitable social investment for the taxpayer because that land is rapidly spiralling in value. What we see is that the government has turned its back on the idea of greenbelt protection.


MR. MACDONALD: Yes, you watch! Year by year you'll find the true nature and the true colours of that horse opposite, and we know what that is. You will wipe out even the major disaster fund. I want to say that on December 11, 1975, this province suffered a major disaster of no mean proportions — and the first thing you do is wipe out the fund.

I did not get up to make a speech — I got carried away. I'd like to say in all seriousness that this is not an accounting financial bill; this is the turning back, to the grief of the people of this province, away from the social objectives that are spelled out in those funds. Make no mistake about it; they will be deprived in the years to come. I think it's a tragedy to turn our backs, as I'm sure we're doing in this bill, on things like greenbelt protection and bringing some of the domain of British Columbia into the hands of the public.

[ Page 859 ]

MRS. WALLACE: Mr. Speaker, I oppose the bill, and particularly on the basis of the first item in the bill, the major disaster fund and agricultural aid to developing countries.

I can only reiterate the sentiments that have been stated by the member for Oak Bay (Mr. Wallace) and others. I feel that to put into the political arena something as important as a contribution to people in need, people in the Third World where we have no concept of the kind of living conditions, the kind of disasters that are faced on a day-to-day basis by those people.... I feel that it is just completely wrong to put this back into the political arena.

That is what we're doing, Mr. Speaker, because when that amount of money becomes a part of a minister's estimates, and when he is a position of, say, preparing a pre-election estimate where he is concerned about the needs of people within this province, needs which are, granted, very great, but needs that, by comparison with people who are starting to death, just can't really be considered as dire or as extreme.... I think that when we get into this position and that minister is having to prepare estimates and he's thinking of his own political future — we're all political animals and that's what we would be thinking of — that it is just not right to return that kind of a fund into the political arena.

I have in my hands here, as a matter of fact, a letter from a constituent in Cowichan-Malahat. Attached to it is a petition relative to this very business about citizens around the world, the hungry world, and the injustices of the distribution of the world's resources.

It is, in fact, taking exception to an article that appeared in the Colonist, but that is rather beside the point. The point I am making is that people are concerned about the Third World and about an establishment of some kind of a perpetual fund. I was concerned when we made a donation to Guatemala at the time of the earthquake. I think it was $25,000. It was a token contribution only, Mr. Speaker, from a province with the wealth and resources that British Columbia has, that we would find only $25,000 going from this province to Guatemala when, I think, a province like Saskatchewan, with a much lesser economic base, sent something like $150,000. I think, Mr. Speaker, we need that fund and we need to use that fund to its fullest possible degree and not put it back into the political arena. For that reason I am extremely opposed to this bill.

MR. L. NICOLSON (Nelson-Creston): Mr. Speaker, I, too, would like to rise and oppose this bill. I think we are seeing here the erosion of the principle that guarantees some security to British Columbians. If the government is going to take the special funds which were put aside some time ago, if they are going to turn their backs on that principle, if they are going to turn their backs on the principle, particularly, of the Green Belt Protection Fund, then I think we are just seeing the thin edge of the wedge towards the erosion of all special-purpose funds and toward a system of maybe politically expedient decisions in terms of expenditures of funds, year by year — particularly in election years, I suppose.

You know, through the Green Belt Protection Fund we were always able to move quickly and visibly in many ways in which we were able to enhance the environment of this province. In the Kootenay-Boundary area we were able to purchase the lands east of Grand Forks, very important as the winter grazing habitat of the white-tailed deer and, to some extent, mule deer — mostly white-tailed deer — a very invaluable resource. In the same manner, we were able to use the Green Belt Protection Fund to buy grazing lands in the east Kootenays to replace some of those grazing lands that have gone under to coal mining and various other types of considerations.

MR. J.R. CHABOT (Columbia River): Nonsense!

MR. NICOLSON: That member — that indifferent member for Columbia River — who perhaps hasn't tramped up in some of those hills as I have.

MR. CHABOT: Oh, oh! Nonsense!

MR. NICOLSON: ...and who hasn't seen the bighorn sheep any further than from his car on the Trans-Canada Highway, he might, Mr. Speaker, take this frivolously, but I don't take it frivolously. If that member isn't going to speak up for his riding, then I will.


MR. NICOLSON: So we're looking at the.... We're looking today at the....

AN HON. MEMBER: Is that your babbling brook?

MR. NICOLSON: ...thin edge of the wedge into many of the special funds, the Agricultural Aid to Developing Countries and World Disaster Areas Fund, the....


MR. NICOLSON: What about the British Columbia Economic Research Fund? Will that be next? What about drug, alcohol and cigarette education, prevention and rehabilitation funds? What about the Economic Policy Analysis Institute Fund and First Citizens' Fund? Does the First Citizens' Fund go next?

[ Page 860 ]

DEPUTY SPEAKER: Order, please!


DEPUTY SPEAKER: Order, hon. members! The member for Nelson-Creston has the floor.

MR. NICOLSON: Mr. Speaker, we see.... I believe I count five funds going under in this bill. Physical Fitness and Amateur Sports Fund — what's to happen to physical fitness and amateur sports? The Accelerated Park Development Fund, the Accelerated Reforestation Fund — will it be next? Will we stop reforesting in terms of some political expediency? What else is to happen? What about the Agricultural Credit Fund, Mr. Speaker?

These, I think will be the concerns of people in British Columbia when they see that probably one of the most widely-recognized and valuable of the special purpose funds — the Green Belt Protection Fund — will be going out of existence. I know the amount in that fund is low at the present time, but it should be increased, Mr. Minister of Finance.

I might also say I am glad to see that the minister has some aid in here along with the advice I gave the other day. I think that's a good decision the minister has made, make another good decision, Mr. Minister. Reconsider this bill. Put more money into the Green Belt Protection Fund because everything in the Green Belt Protection Fund.... We can look at it and say that that fund is down — I don't know what it's down to now, maybe $2 million or less....

HON. L.A. WILLIAMS (Minister of Labour): just look at the figures. Why don't you read the public accounts?

MR. NICOLSON: It was, I believe, $25 million. But everything that was purchased out of that fund is an asset. If you were to look in terms of normal bookkeeping practices at the assets and liabilities under that fund, and if you were to take the current appraised values of the assets under that fund, I am sure we would find that it's well in excess of $25 million. I am also sure that we would find that in terms of the social, recreational and environmental value, we could not even put a dollar figure on that expenditure and on that investment. It is with this concern of a very dangerous step being taken by this government.... Is the Crop Insurance Stabilization Fund to be another victim? Farm Income Assurance Fund, Farm Products Industry Improvement Fund, the Ferry Capital Expenditures Fund — what other funds are to be rescinded?

I think it's a regressive step and, Mr. Speaker, I think the people of British Columbia will be watching the actions of this government very seriously. They'll be particularly interested to see what substitute action is going to take place in lieu of — or, one might say, in left of — in left of....

AN HON. MEMBER: In right of.

MR. NICOLSON: Well, we do say "Lieutenant-Governor, " hon. member. We will be watching to see what steps are taken in lieu of these funds. Will the government be responding when opportunities arise to take steps which will enhance either the direct environmental concern such as grazing, particularly winter range, for threatened species, or perhaps just aesthetic concerns surrounding cities where there is a tremendous need for greenbelt protection around urban areas? People will be watching this and we will certainly be watching this. We hope there is no further incursion into this area.

MR. C. D'ARCY (Rossland-Trail): I certainly don't want to extend debate on this. I think most of the major cogent points have been made. I just want to let the government know that I believe that when you tear something down I think you should have something ready to put in its place. I certainly concur with the remarks that have been made here that one of the things we've got through these funds in the past is a sense of security. Although you know it's not a great deal of money, you can tell the province, the country and the world that, yes, this Legislature and the government of the day does believe in power and telephone line beautification. It does believe, on an ongoing basis — not just this year but maybe next year, maybe the year after — in agricultural aid to developing countries. Perhaps most importantly, Mr. Speaker, it shows that this province and this government agree with major provincial disaster protection, and I would suggest that that's a tremendous feeling of security for each and every community in this province.

Not very many years ago, about this time of year in 1968, we had a major disaster in the city of Trail — a sudden disaster. The assistance that the provincial government could give through this fund and other areas was tremendously important to the city at that time. I would note that just over the past weekend there have been three major slides in the Castlegar area. Fortunately, these slides did not hit any homes or businesses. They have, however, resulted in considerable expense to the Inland Gas Co. and the B.C. Telephone Co., and lesser expenses to the B.C. Department of Highways and the West Kootenay Power and Light Co. I note that had one of them been a matter of yards to the southwest there could have been a major power outage, possible affecting all of the southern interior due to hitting a substation at the Brilliant Dam belonging to the West Kootenay Power and Light Co.

[ Page 861 ]

For those reasons, Mr. Speaker, although I would like to support this bill, because I must tell the House that I happen to agree, in very general terms, with the idea of taking some of these funds back into general revenue, I don't happen to agree with bill funding in the way that we used to develop parks in this province. I don't happen to agree with special bills before this House for capital development. I think that all these things should be in the estimates of the particular relevant department. However, the fact is that these things are being taken away. They were a permanent security to the extent that they went for the people of B.C.

They're being taken away and there's absolutely no ongoing commitment that they will still exist. We're going to rely on the government of the day's largesse in any particular year, in any particular situation. Quite frankly, Mr. Speaker, I don't think that's good enough. For that reason, reluctantly, I have to oppose this bill at this time.

MR. R.E. SKELLY (Alberni): Mr. Speaker, I must rise in opposition to this bill, for many of the same reasons that my confreres on this side of the House have opposed the bill as well. These special funds have provided some ongoing protection to the people of the province over the years since they were established, and I give credit to the previous government and to the previous Social Credit government in establishing some of those funds.

Just over the last year, Mr. Speaker, in my riding, there was serious flooding along the Somass River in Port Alberni and in areas on the west coast of Vancouver Island such as Tofino, and this Provincial Major Disaster Fund assisted many people who would have suffered grave personal loss had that fund not been available to assist those people. I think rather than depleting the funds or recapturing the funds from that special fund, we should be restoring money to that fund and restoring money to many of these funds.

I'm also concerned, as was the member for Vancouver East (Mr. Macdonald), about lands protected by the Green Belt Protection Fund. In the past, Mr. Speaker, under the Social Credit government, the parks branch had been starved for funds, and they were forced in many cases to exchange lands or exchange timber rights or mineral rights in parks for lands outside parks of higher recreational value. As a result of that policy we lost something like two million acres of parkland under the former Social Credit administration. We lost it to timber exploitation, to mineral exploitation and hydro dam reservoirs. Our government, Mr. Speaker, over the past three years attempted to restore that land of tremendous recreational value back to the people of this province. Some of these special funds — granted, special funds set up by the Social Credit government, such as the park fund and the greenbelt fund — were used to purchase additional lands to restore the two million acres that were lost from our provincial parks under the 20 years of Social Credit administration.

So I'm very concerned about the loss of the greenbelt funds, Mr. Speaker, particularly in my riding, A few years ago, in 1972, when the NDP first took office, we attempted to acquire a small area on the west coast of Vancouver Island, a place called Hot Springs Cove, which is one of the few hot springs on Vancouver Island. The parks branch didn't have the funds at that time, Mr. Speaker, under the previous Social Credit estimates, to acquire land that would be very valuable for recreation in the future. The greenbelt acquisition fund was essentially the sorting of money to buy land that would be of tremendous recreational value in the future. As a result of an expenditure from that greenbelt acquisition fund we were able to acquire Hot Springs Cove and to bring it into the provincial parks system.

There's a river in my riding, Mr. Speaker, and it abuts the riding of the member for Nanaimo (Mr. Stupich) . The Englishman River in the future will be very valuable for salmon production, and in fact the federal and provincial governments are looking at that river to enhance the salmon production of that river. At the moment there are two pieces of property on that river that are threatened by subdivision development and by residential and commercial development. We are very concerned about this. The Department of Highways has been in consultation with the developers and the local communities, and the regional district has talked to the developers. The developers, I believe, have approached the departments of Environment and Lands down here, and in fact they've offered some of the land to the province under the greenbelt acquisition fund.

Mr. Speaker, this river — the Englishman River — has the possibility and the potential and the future of being a tremendous salmon producer for this province, given the fact that the federal government has established a salmon-enhancement programme for British Columbia. But if we lose these valuable productive lands along the streambanks, along the riverbanks, then there's the real possibility that we'll lose the whole river as a salmon producer for the province.

I'm very concerned, Mr. Speaker, that if we eliminate such funds as the greenbelt acquisition fund, then we'll lose that potential of saving rivers such as the Englishman River from development and lose that potential for salmon production that will give us jobs, that will give us provincial revenues, that will tremendously enhance the employment and the revenue opportunities of the province in the future.

I think that we shouldn't be looking at these funds on a short-term basis. If this is simply a measure to

[ Page 862 ]

balance a budget over a one-year period, then it's a very irresponsible measure, Mr. Speaker, and I think the government should give it more consideration.

The investment of, say, a few million dollars, in acquiring 1,000 or 2,000 acres along the Englishman River, along the Megin River on the west coast of Vancouver Island, could return to this province in the future thousands of jobs for fishermen and thousands of dollars in revenue from income tax from the fishery industry. So I think that the present provincial government should take a second look at calling up some of these special purpose funds, and I intend to oppose this bill, Mr. Speaker.

MR. E.O. BARNES (Vancouver Centre): I won't take very long. I just want to voice my opposition, along with my colleagues, to the proposed consolidation of the funds from these special funds into the consolidated revenue. But first I would say to the Premier, who is not in the House at the moment, that it would be of great assistance to those of us in the opposition if we were to have some warning in terms of the order of business. It's a bit difficult when we traditionally had a Whip system in the Legislature, and at the moment we have a non-functioning system.

DEPUTY SPEAKER: Order, please. We're on Bill 7.

MR. BARNES: Thank you, Mr. Speaker. But I'm sure the Premier would like to assist those of us in the opposition in preparation for our presentation by giving us some indication of what the order of business will be.

In any event, I would like to say that without having had sufficient time to get the response from the community in my riding, which I feel is very important on such a major stop as this, which I suggest is a major policy change on behalf of the government, I hope the minister, when he closes the debate, will assure the House that in consolidating the funds from these special programmes there will be no problem should there be a need for expenditures in the areas that are being consolidated.

For instance, if someone is interested in funds to acquire a greenbelt area that should be good for the people of British Columbia, I hope that the minister will forthwith take all the necessary action to acquire the same, and in every other aspect of interest to the community. My fear is that since there will be no special fund after this bill passes, the government may find itself short of funds from time to time and will be responding to those requests by stating that there just aren't funds available at the time. Even though these funds are not that large, it is a dangerous thing to start eliminating them because in principle it indicates the government's intention to respond in certain areas of importance.

In closing, I just would like to suggest to the minister that it would be reassuring to those of us in the opposition if he would indicate that the government intends to follow to the letter its suggestion in the bill that this is not a change in policy as such, but rather a means of expediting its fiscal programme in trying to utilize these funds to the maximum. I can appreciate that, but I think at the same time that unless we have something rather specific in the way of a commitment on behalf of the government, by the minister preferably — that is, with some direction as to how the procedure will take place should an emergency situation arise, as there are bound to be disasters in our own province or in some other country — there will be a need for us to be concerned that we have made a major policy change and really do not have any assurance that we will be responding on behalf of the situations in the future.

MR. C.M. SHELFORD (Skeena): Mr. Speaker, I certainly don't intend to keep the House long this afternoon, but I would point out that if the members across the way had managed the finances of the province properly these funds wouldn't be going out at all.

I would say it's a most unfortunate bill that is coming into this House, and I must say that I have to support it with reluctance, because I actually like many of these funds, especially the agricultural aid and world disaster fund, which I think I can take some credit for getting started in the first place. I remember speaking to the Premier the day I was taken into the cabinet of the need of this type of a fund. In fact I suggested $2.5 million, and I was surprised when he brought it in at $5 million. But it was a good fund and I hope the day will come, Mr. Minister, that once you get the province back on its feet from the disastrous three years, you will not only bring it back at $5 million but bring it back at $10 million.

I was very pleased when attending a world conference one time to find that speaker after speaker stood up and pointed to this type of approach of foreign aid. The people in the developing countries liked our approach, especially our scheme we started in the Cameroons under this fund, where we showed the people there how to produce food for themselves. As I've mentioned before, it's impossible to ship enough food from Canada to these countries and the best method of aid is to show them how to do it for themselves. We sent over, in this particular case, tractors and ploughs, et cetera, along with chickens, geese, turkeys, goats and sheep, Offspring from these various things we sent over spread all over that part of the country and increased their production simply tremendously. The few dollars that we put into this sort of stuff brought 100 times

[ Page 863 ]

back to British Columbians.

In the case of Korea, where we sent surplus egg powder and milk powder to the Korean children, Doctor Hichmanova thought this was just great. But it also helped the farmers because it moved away the surplus crops. You always have to have a surplus of milk and eggs or we end up with the type of thing that happened last year when we threw eggs into the garbage cans. I think if these surpluses can be moved to the needy then we not only help children but we also make friends, which helps us sell our products on the world market. It was through our connections with Dr. Hichmanova in Korea that we finally sold 28,000 dairy cattle to the Koreans.

This is the type of thing I like to see, and I would hope, Mr. Minister, that within a year or two years you'll be standing up and saying we're going to put in a $10 million or $20 million fund, because I agree with my friend across the way, for a change, that this is certainly something we have to look at. We do have to help people outside of our own country.

MR. D.F. LOCKSTEAD (Mackenzie): I don't want to hold up this bill too much longer, but I would suggest that the hon. member for Skeena (Mr. Shelford) did give us a number of good reasons why the fund should be retained. I think that was very well done, and I'm pleased to see he's going to walk with us on this matter.

I think a good argument can be made, Mr. Speaker, particularly in ridings like mine where the Green Belt Protection Fund has saved parkland areas around communities and preserved these areas for people from all parts of the province to enjoy. You do away with this Green Belt Protection Fund, and it's going to go into the political general kitty and we'll never see another dime up there, so I really think I will have to vote against this.

There is the disaster fund. You know, once again I can see in estimates that the water rights branch doesn't have the funds it requires to carry out its functions properly. I know that in Bella Coola if certain jobs in regard to flooding conditions aren't done in that area this year — and soon — there's going to be a major disaster in that area come the spring thaw. So I suggest we're going to need those disaster funds for areas like Bella Coola, Mr. Speaker, and I cannot vote for this bill,

MS. R. BROWN (Vancouver-Burrard): It's good to be back, Mr. Speaker. I left Newfoundland at 7 a.m. this morning and I'm in pretty rough shape, but I was informed that your Bill 7 is going to be the bill that recaptures various funds, including the agricultural aid to developing countries fund and the greenbelt fund, and I would very much like to take my place in this debate to speak against this piece of legislation.

I think we are not satisfied that the government has an intention to continue to meet the needs of these funds we're meeting and would prefer to see them remain as they are.

I must confess I was a little bit alarmed by the use of the world "recapture." When I spoke in the budget debate, Mr. Speaker, through you to the minister, at that time I voiced my alarm at the use of the word "recapture" these funds as though somehow they had fallen into enemy hands.

There was a very deliberate reason why they were set up as separate funds and not made a part of general revenue. There was a very deliberate reason why they were earmarked for the various services that they were earmarked for. I think that this is a step backward and I would very much like to add my voice in opposition to this Bill 7. I think we have some kind of responsibility, not only to people who live in this country but to people in other parts of the world. We are not going to be guaranteed that the responsibility is going to be discharged if the fund is going to be "recaptured" and placed back in general revenue. I don't know whether the Minister of Finance pays any attention to please which are delivered to him through you, Mr. Speaker, but I would certainly like to add my voice to those of the other members of the opposition, pleading for the withdrawal of this bill. Thank you.

MR. W.S. KING (Leader of the Opposition): I had not intended to say anything either, but when the member for Skeena (Mr. Shelford) rose, I felt I should comment on a few of the points he made.

The member for Skeena indicated that somehow there was a problem in terms of the finances with respect to these funds. I would point out that it was amply demonstrated, Mr. Speaker, that large sums of money were directed to other purposes for some reason or other, just before the end of the fiscal year, when it has been amply demonstrated that there was not need for such disbursements — namely ICBC and the universities council. But I think more telling — and I hope the member for Skeena pays attention, Mr. Speaker — is the fact that these perpetual funds grew from 1972 until the end of the fiscal year 1975. There was a growth in the perpetual funds from $90 million to S 105 million, and in the special funds from $257 million to $431 million. Well that's hardly an indication that there were financial problems with those funds.

I must share the views expressed by various members of the opposition as well as the member for Skeena, and I certainly paid close attention to his comments and accept them in all good faith. I would hope he would follow through and once again, as he once had a reputation for so doing, demonstrate his independence and his willingness to fight for the people in his area and their interests above any partisan devotion to an assortment of people who

[ Page 864 ]

happen at this time to be political fellow travellers.

I hope the minister will put aside his aspirations, perhaps, for joining them on the treasury benches, assert his independence and demonstrate that he puts his people's needs, his constituents' needs, ahead of his own political needs.


MR. KING: That's right. Perhaps, Mr. Member for Skeena, through you, Mr. Speaker, that is the road to Damascus once again for you, you know. Sometimes the cabinet likes to silence those dissident voices on the back bench, and I understand that other people in the past have arrived on the cabinet benches through that very route. Once successful, it might work again.

But, Mr. Speaker, I have looked at the estimates for some of the funds which we have been told will be placed in the departments and I notice that under the Environment department, under the land management branch, there is reference to the Green Belt Protection Fund Act, but it's not clear in terms of any financial allocation just what is allocated for that purpose. I assume it's under special programmes, and the total amount, Mr. Speaker, as I read it, is $2,356,830. Now I notice that under that branch there are 19 employees, so I have to assume that for a payroll of 19 employees and the incidental office and administrative expenses, we would be left with something under $2 million to be applied to that purpose. Again, there's no indication that it's solely for the Green Belt Protection Fund. I don't know what other programmes might be involved there too. That does little to assuage the concern of the opposition that there is any real intention of either maintaining or broadening the approach to greenbelt acquisition in this province.

Again, the other funds that have been disbanded...the disaster fund is similarly clothed in some vote that is very difficult to determine and analyse in any detailed way. I'm very apprehensive that we will find on the one hand when catastrophe strikes in British Columbia, as it frequently does in the kind of terrain, the kind of geography, that we have in this province, that there will be a shortage of funds.

[Mr. Speaker in the chair.]

At least the response from government will be that there are inadequate resources to come to grips with the proper compensation to people adversely affected, and also the need to take remedial action before the fact, which is often the most economic thing to do. An ounce of prevention is worth a pound of cure. If there's a danger of imminent flooding and some action can be taken before the fact, that often saves greatly in terms of dislocation to private property and homes and, in the final analysis, in terms of cost to government. So I hope that we don't find the government too thrifty with the purse strings to the extent that they incur a higher cost than they otherwise might have.

I would point out too that I have some apprehension...and the opposition is going to be watching very closely the expenditure of the funds earmarked through the departmental votes, because there are characteristics about this new administration which are singularly reminiscent of an older era.

One of the characteristics used to be the constant and the regular underexpenditure of departmental votes for various purposes. So we are very concerned to see these funds taken out of the special status they enjoyed, where there was a real accounting and where there was a real ability to measure the use to which they were put, rather than closed in departmental votes which may or may not be allocated and utilized through the year.

So for these reasons, Mr. Speaker, the opposition must oppose this change.

HON. MR. WOLFE: Mr. Speaker, in speaking to the principle of this bill, which we have been doing, I have listened very carefully to the various recommendations and suggestions of the members opposite and some members on this side of the House. They seem to reduce themselves to two main points of issue with regard to this measure. One is that, in fact, the government did not need to transfer these funds to general revenue. Second is the ongoing concern expressed about whether the purposes intended for these funds would still be followed through.

Mr. Speaker, in delaying with the first question — that we didn't need to in fact take this measure to remove these funds into general revenue, some $28 million — I think it's fair to say that this is tantamount to saying that $28 million is a small amount: forget about it, operate on the deficit or hope that the revenue will be there to compensate to balance the budget.

This was the last measure adopted in the budget to balance the budget. For the members opposite to suggest that it need not have been done to balance the budget, I think, overlooks the fact that had the election in December taken a different turn, had the NDP been elected in December, as sure as I am standing here they would have been taking the very same measures.

Mr. Speaker, a part of their master plan to balance the budget, which the former Minister of Finance is aware of, was to transfer funds from Crown corporations and so on in an attempt to wiggle into a balanced budget. I say to you that they had contemplated removing certain special-purpose funds,

[ Page 865 ]

the very thing that this government is advocating today in this bill. They contemplated that in what I would have called the NDP master plan to balance the budget. So, Mr. Speaker, I do not buy their statements here today that the measures we are taking to remove the funds were not necessary.

Dealing with the question that the budget should have been balanced, but because we have underestimated the revenues — I would presume we could deal with this further in dealing with some of the other tax bills. But this is tantamount to saying that we should overestimate the revenues, not take a safer course in terms of being able to know that the revenues which can we can foresee will be there to balance the budget. This is our policy on this side of the House, and the one we will hold to.

I know that there has been a lot of concern expressed that these have been worthwhile funds. We certainly support this fact. It is every intention of this government to carry on using the funds formerly used from the special purpose funds for the purposes intended, as indicated through the various votes. I think the more important thing than to have the funds there — which is a safeguard to anyone who wants to see that the funds are then available for these purposes — is in the structuring of a healthy financial picture in the province so when major disasters or unexpected events occur which call on the provincial treasury for sizable amounts of funds, we have reserves there to take care of the issue. I think this is more important than having actually set aside funds, as much as we have always advocated that.

So, Mr. Speaker, in principle, we support the purpose of this bill. It was made necessary to balance the budget which is before us. I therefore move second reading.

Motion approved on the following division:

YEAS — 32

McCarthy Gardom Bennett
Wolfe McGeer Phillips
Curtis Calder Shelford
Chabot Schroeder Bawlf
Bawtree Fraser Davis
McClelland Waterland Mair
Nielsen Vander Zalm Davidson
Haddad Hewitt Kahl
Kempf Kerster Lloyd
Mussallem Rogers Strongman

NAYS — 16

Macdonald King Stupich
Dailly Cocke Nicolson
Levi Sanford Skelly
D'Arcy Lockstead Barnes
Brown Barber Wallace, B.B.

Wallace, G.S.

Division ordered to be recorded in the Journals of the House.

Bill 7, Special Funds Revenue Recovery Act, 1976, read a second time and referred to Committee of the Whole House at the next sitting after today.

HON. MRS. McCARTHY: Second reading of Bill 9, Mr. Speaker.


HON. MR. WOLFE: Mr. Speaker, in moving second reading of Bill 9, Income Tax Amendment Act, 1976, you will remember that the budget-announced tax increases were necessary to meet anticipated expenditures, and this bill proposes to raise both the personal and corporation taxes payable. Personal rates are raised 2 per cent from 30.5 to 32.5 from July 1, 1976, and effective I per cent for the year 1976. Corporation rates are raised 2 per cent from 13 to 15 per cent effective January 1, 1976. At the same time, the small business rate of 10 per cent is raised to 12 per cent. Generally, a small business is a Canadian-controlled private corporation with a net income of less that $100,000 in the year. Mr. Speaker, a companion amendment is included to adjust the offset allowed for logging tax paid against income tax payable, to keep the offset allowed current with income tax rates payable in 1976. An additional $23.5 million revenue is expected from the personal rate increase and $31 million from the corporation rate increase for the year 1976-1977. Mr. Speaker, I now move the bill be read a second time.


MR. STUPICH: Mr. Speaker, if that was a question....

MR. SPEAKER: Order, please. The hon. member for Nanaimo has the floor.

MR. STUPICH: I am surprised. It is not often we have trouble hearing the hon. member for South Peace (Hon. Mr. Phillips) .

MR. WALLACE: Don't encourage him.


MR. SPEAKER: Order, please.

[ Page 866 ]

MS. K. SANFORD (Comox): Withdraw!

MR. STUPICH: Mr. Speaker, I do have some concerns about Bill 9, Income Tax Amendment Act, 1976. They are not concerns about supporting an increase in income tax, however. I think it's well recognized that the most progressive of all taxes is the income tax. Of course, no one likes paying taxes of any kind.

AN HON. MEMBER: Right on!

MR. STUPICH: But I think all will admit — well, maybe not all — but most people will admit that the fairest form of taxation is the one that is based on the principle to pay. Earlier in this session we debated another bill, a bill that the opposition side of the House, or at least most of the opposition side of the House, agreed was regressive, a bill, I think, that even the government members would agree was regressive in nature. I believe it was the Minister of Finance himself who, in supporting the bill, gave the only real reason for supporting it and proposing it at all, and that was that it was easy to do, but never attempted to defend the principle of raising taxes by a method that is as regressive as the one in that particular bill.

However, the income tax method of raising taxes is generally agreed to be a progressive way of doing it. However, changes have been made by the federal government that have removed some of the progressiveness from this particular tax. Of course, since ours is based on the federal programme, our tax has become less progressive rather than more progressive as time has gone on. The particular bill before us...the government had an opportunity, when it wanted more money, to perhaps do something a little different. Other provinces have done something different. We pride ourselves on the fact that our income tax rate is lower than most provinces. We are still the lowest of all provinces. Rather than moving this particular tax rate up and perhaps priding ourselves on being lower in other areas, we would prefer it if we were to remain in our position of being lowest or very low in other direct taxes, retrogressive taxes, and to be higher in this progressive area that is the income tax.

The province of Saskatchewan had the same choice facing it. In discussing the Anti-Inflation Board and the proposals put forward by the federal government, we argued then that the federal government was not doing enough to make sure that the people who were earning the high incomes were going to be taxed accordingly and that if they earned incomes in excess of the proposed maximum increases — the increases proposed by the federal government — that some very punitive income tax rates would be applied. Well, of course, the federal government didn't see fit to do that. The province of Saskatchewan did see fit to move in that direction. Unfortunately, the province of B.C. did not see fit to impose very heavy rates of tax on those who were able to escape the principles of the Anti-Inflation Board proposals and instead to get around them, to increase their personal incomes much more than the suggested maximums proposed by the federal government.

In this particular legislation before us we are not correcting that in any way at all. It is simply a 2 per cent increase for everyone, whether high or low. We are not protecting the low-income earners as we could have done in this particular kind of legislation. We are not getting after the people who are getting the fantastic increases.

Mr. Speaker, I think it's worth recalling in this that even if the Anti-Inflation Board survives, and even if the anti-inflation programme proposed by the federal government does last — and there seems to be some real question about that now — the maximum increase is not the suggested figure of $2,400 that was talked about when the programme was first publicized; it is that a group of people earning high incomes may not have an increase in excess of an average of $2,400. But it's quite possible, under that scheme, that one person out of 10 might have an increase of $24,000 and the rest of them nothing, and still be within the limits set by the anti-inflationary programme.

In this legislation before us we're not doing anything to correct that kind of position. It's submitted that the federal government plan will not really work against professionals — against chartered accountants, against lawyers, against doctors. There is no way of controlling it in the schemes that they have presented to us so far. The proposals they have made, they admit, are not really going to be effective; they are going to trust the people concerned to do the right thing. But not always will that trust be well placed.

In the Income Tax Act we have an opportunity to see that there's no need to rely on people to do the right thing and an opportunity to convince the community as a whole that people who are earning high amounts of money and who are getting large increases will be paying at least a large proportion of that, if not all of it over a certain figure. In the Income Tax Act we had the opportunity to correct that; we have chosen not to do so. We have chosen not to take this method of convincing the community as a whole that there really is a fight on to control inflation and that B.C. Is doing everything it can, including using the Income Tax Act in a similar way to that which was done by the province of Saskatchewan.

We're disappointed, Mr. Speaker, that the Income Tax Amendment Act doesn't go much further than it does in the proposal before us, doesn't take advantage

[ Page 867 ]

of some of the opportunities to really shift the load of tax paying as it might if we were to have the proper kind of legislation before us. We're disappointed then in the legislation before us; however, it does mean that more money will be collected by what is the most progressive form of taxation available and, although we're disappointed in it, we are going to support the legislation before us.

MR. GIBSON: Mr. Speaker, I'm reluctant to support any legislation which increases taxation, but I do give my reluctant support to this particular bill because, as the previous speaker has said, if you have to raise taxes, income taxes are the fairest kind to raise.

I would very much hope, however, that this raise in the rate is a temporary one. I want to make it clear at this stage that I support the principle only. I think there is a major flaw in the detail of the bill, namely that portion of clause I which provides for one rate for the 1976 taxation year, which is, of course, where we are now, and then an additional hike in the 1977 tax year. The minister, in his opening remarks, said that this increase in the personal income tax might raise something like an additional $23 million in revenue in the next fiscal year, but he neglected to say that in the fiscal year after that it would raise a good deal more — something in excess of $50 million, surely.

To me, Mr. Speaker, it's quite wrong to, in this year, be imposing tax rates in respect not simply of the next fiscal year, but of the fiscal year thereafter. As I say, when we get to the consideration of detail at committee stage, I will be seeking to vote against that particular aspect of it.

The remainder of the bill as it applies to corporations, particularly retaining the preferential rate for small businesses, I support. I support, given the context of our existing tax system which I happen to believe should be completely reformed insofar as the manner of taxing corporations is concerned, but as far as we retain the existing tax system, then these raises are proper to retain some kind of a balance and equity with the persons who have to pay personal income tax.

With those various caveats, Mr. Speaker, I give my somewhat reluctant support, but nevertheless support this bill.

MR. WALLACE: Mr. Speaker, it of course goes without saying that no politician, either for political reasons or any other reason, is happy about raising taxes.

My feeling, however, is that there is a problem for this government of raising additional sums of money, and I agree with the speaker who spoke for the NDP that at least if we have to raise taxes let us try, as far as possible, and adhere to the principle that you pay your taxes based on your relative wealth and your ability to pay. In that respect, I have to say that if revenues have to be increased, then it would be my view that the income tax changes, or changes in the income tax rate, would be the best route to go.

I suppose that one could be perhaps a little ironic and say that in that regard the examples quoted on page 31 of the budget speech state that the proposed increase for a single wage-earner with an income of $10,000 is $1.23 per month. If one wanted to be really objective, I would have to say that when you put that kind of small raise alongside the impact of the 2 per cent sales tax increase on the low-income earner, then my conclusion would have to be that a greater degree of fairness and economic justice would have been brought about by perhaps even a larger increase in the income tax, if that could have been balanced by no change in the sales tax.

Mr. Speaker, I have no wish to reflect on another vote of this House, and we've discussed that, but if more money has to be raised, then the income tax scale is the best way to go. And I have to wonder if these figures on page 31 of the budget are really accurate. I'll quote the next sentence: "For a married person earning $15,000 in 1976, and with two dependents under 16, the increase in tax is $ 1.92 per month."

Well, these are certainly very modest increases and it seems to me that a greater degree of consideration could have been shown to the person on Mincome, to the low-income earner and the person who is really having a tough time by perhaps even considering a larger increase in income tax and avoiding the other measure which I referred to.

I also would like to emphasize a comment made by the Liberal leader (Mr. Gibson), and which seems to have escaped almost everyone's attention. Certainly there's been very little reporting of the fact that in 1977-78 there will in practical effect be a further increase in income tax because the 2 per cent increase this year really only applies to six months of the year, and, presumably, there will be at least double the $23.5 million increase of income tax revenue in 1977-78 compared to 1976-77 over the six-month period.

I wonder if the minister, in giving second reading of this bill, will make sure, for the sake of the House and the taxpayer in this province, that the Liberal leader and I have got it right, just in case this is not the situation. But if it is the situation, then the government is already planning to take in another additional $23.5 million in 1977-78 over and above the extra that is to be collected over a six-month period in this fiscal year.

I think very strongly, as the Liberal leader stated, that it's tough enough to try and project revenue and calculate budgets for one fiscal year without trying to project it even into the next one.

[ Page 868 ]

The Minister of Finance said earlier in the previous debate that the opposition parties had implied that $18 million wasn't very much. I certainly never left that impression, and I don't say that now. I don't say that $23.5 million of personal income tax revenue is peanuts either. I think because the total budget adds up to $3.6 billion, perhaps there is a tendency for members of the House to throw around figures like $25 million and $23 million and so on as though they were insignificant. I very quickly and very loudly say that no way do I regard sums of money of that size as being insignificant just because they are a relatively small percentage of the total budget,

The corporation income tax has increased. Again, I think that if taxes have to be increased, corporations have to take their share of the load. But I think it is not completely accurate for the budget to talk glibly about corporations as though they were some inanimate, lifeless structure rather than individual human beings paying more taxes. The fact is that corporations make profits by selling goods to consumers, and that's you and me. If the corporation pays more tax, the product almost inevitably costs the consumer more.

So while I agree that we have to raise and increase taxes by some of the measures that have been adopted in this particular bill, the increase of corporation tax is inflationary. The effects of the income tax in this bill are moderate or modest, and in the total context of the budget, I think, might even have been slightly greater to try and soften the impact of other tax measures which are punitive towards low-income groups.

So it's a matter of opposition members trying to be responsible and support a bill of this nature, which, unfortunately, is necessary, yet at the same time stand here and criticize some of the ingredients of the bill, which I will do in committee. But in principle, I think the minister is correct in going the income tax route. I think I would even have been prepared to support an even slightly greater increase in tax, assuming that the figures here quoted on page 31 of the budget speech are correct.

MR. DARCY: Mr. Speaker, I'm glad to see you back in the chair. As with the previous bill, I don't want to spend a great deal of time on it. I just want to tell the House that I reluctantly will support this bill. While we all seem to like an ever-increasing number of services in government, none of us likes to have to shell out for them, especially if it's our personal income, or from our companies. But I do think that this is one of the fairest ways of raising extra revenue.

I would like to follow up on the point that was raised by earlier speakers — and return to a favourite theme of myself — about the fact that this bill is going to raise, and I think it's a conservative estimate, $55 million in this fiscal year.

Mr. Speaker, that amounts to some 0.37 per cent of our total disposable income, total per capita income in this province, and an effective cost of living increase of that amount. If we look at 1977, when this bill will raise probably — and I'm thinking conservatively again — about $120 million, that would amount to somewhere around 0.75 of 1 per cent of a cost of living increase over what we're looking at now. I think that's a significant amount.

I believe that every member of this House would probably agree that this is a time when we would like to see some more business opportunities in this province, some more job opportunities and some more opportunities for professional people. I hardly think that this is conducive to that kind of expansion to take more millions — $55 million this year, $120 million next year — out of the pockets of British Columbians, even though I accept the government's contention that it may well be necessary if we are to maintain the level of services that we have today.

MR. SKELLY: Again, I intend to support this bill, although reluctantly. While no one appreciates an increase in taxes at any time, I think that this is probably the only bright spot in any of the taxation measures that have been brought in by this government, and probably the only taxation bill that we, as an opposition party, can support.

When you look at some of the other revenue measures taken by this government, they are totally regressive and they operate totally to the detriment of the poor and lower-income people in this province, Mr. Speaker. I'm thinking of the ICBC increases, Medicare increases, social services tax increases, ferry rates and even partly the corporation tax increases.

Corporation taxes are in here — so even partly corporation taxes; those are regressive taxes in that they're passed on to the citizens of the province. So all or most of the tax measures brought about, and most of the increases in fees brought about by this government, work more harshly against the poor than they do against the wealthy, who are the people who basically support the campaign funds of the party opposite and who assisted in electing them to office.

So reluctantly again, Mr. Speaker, I support increases in the personal income tax. But the corporation tax is one that is partly regressive in the fact that it's passed on through the corporations to the consumer, and while I do support the Liberal leader (Mr. Gibson) in the House, who said that he was pleased to see the differential between the large business corporation tax maintained, I think it probably would have been better from the point of view of the economy of British Columbia and growth in the economy of British Columbia to have retained the corporation tax for small business at the same level as it was when it was reduced last year by the

[ Page 869 ]

New Democratic Party.

Most of the large corporations in British Columbia, Mr. Speaker, are engaged in the export market and those costs can be passed on to our customers overseas (laughter) — passed on or rearranged in such a way that profits of those huge corporations are reduced to a more reasonable level and they can absorb those increases in corporate taxes themselves.

But the small corporations doing business here in British Columbia cannot afford to do that. They must pass the total cost of those corporation income taxes on to the smaller people, and in that way the corporation tax on small business is partly regressive.

We've done some study into the taxation practices in Canada, Mr. Speaker, and we find that over the years the types of taxation used in Canada have been particularly regressive and have been designed to keep the poor poor and to keep the rich rich.

In fact, since 1957, according to Statistics Canada figures, we find that the gap between the rich and the poor in Canada has increased, not decreased. Most of this is due to the taxation methods used by governments provincially, federally and locally and by the transfer payments made by governments to the poor. That difference between rich and poor in this country has been increased and I think that most of the taxation measures brought in by the Social Credit government will tend to do that in British Columbia, and the corporation tax increase on small corporations will tend to do that in a small way.

Fifty-one per cent of the taxes in Canada, Mr. Speaker, are totally regressive. Corporation taxes are partially regressive, and they amount to about one-fifth of the taxation in Canada. So, in total, about 70 per cent of all taxes in this country are regressive and for that reason work more harshly against the poor than against the wealthy.

Rather than increase taxes on smaller corporations, and rather than bring in those regressive tax measures, it would have been far better to see the government increase the income tax as they have done, but increase it a little more and incorporate in those tax increases such things as the 50 per cent increase in Medicare premiums, the 400 to 700 per cent increases in B.C. Hospital Insurance, co-insurance, to incorporate those into the personal income tax so they are based on ability to pay rather than being regressive and being more harsh against the poor than against those who can afford to pay.

In addition, Mr. Speaker, they should have raised the exemption level so that the exemption levels for personal taxes in this province are more in line with the poverty line, with people's ability to pay again.

I think there's one tax that was left out of the whole tax picture. I don't see it mentioned anywhere in this bill, but it should be mentioned, and that's a capital gains tax on property. The one thing.... This was brought up by a former member of this House, Mr. W.A.C. Bennett, now retired, when discussing social services tax away back in 1948. You'll recall that debate, Mr. Speaker, when he said they should tax the unearned increment on property. He said that people in this province are getting away with a huge inflation in capital values and in values of property and we as a province could increase our revenue substantially without working any hardship on the poor by attempting to recapture some of that capital gain on the increase on capital value.

MR. SPEAKER: Order, Hon. Member. Could we get back to the principle of this bill, which is a bill to increase personal and corporate income tax? It has nothing to do, in principle, with capital gains tax, hon. member.

MR. SKELLY: Oh, yes, Mr. Speaker. But in proposing some alternatives, it's possible we wouldn't have had to increase the income tax as much, had the Social Credit government examined some of the alternatives that are more fair and probably would have increased more revenue. Now naturally they would have taxed the very people who supported their campaign funds, mainly real estate people who supported the Social Credit campaign because they're the ones who have reaped the greatest capital gains.

MR. SPEAKER: Order, hon. member. Order! The principle of this bill is an increase in personal and corporate income tax. It has nothing to do with capital gains tax, and I'll repeat to you that to stay in order on the principle of the bill, you must stay within the confines of what the bill provides, and that is an increase in personal and corporate income tax. As long as you stay in that area you are certainly in order, but once you start discussing a different subject matter altogether....

MR. SKELLY: What I'm discussing, Mr. Speaker, is the level of increase in the personal I income tax and that if the government had taken a reasonable look at other alternatives — for example, capital gains tax — then it's possible we may not have had such a high level of increase in the corporation income tax and in the personal income tax in this province that we have in this bill.

So that's one example — one alternative — that the Social Credit government could have looked at that was suggested by the present Premier's father and that, unfortunately, Social Credit hasn't adopted over the years, although Ontario and other provinces have.

In the main, Mr. Speaker, we do accept the principle of this bill, that taxes on income are much better than the other forms of taxation and charges brought in by the Social Credit government because they are based in the main on ability to pay.

We do agree that the differential should be

[ Page 870 ]

maintained between corporation taxes on large businesses and small businesses, but we feel that other alternatives should have been examined by the government, and it's unfortunate that most of the taxes they've brought in have been regressive and taxation against people.

MR. D.F. LOCKSTEAD (Mackenzie): Just a brief note on this bill. I should point out to the members of this House that the Mining Association of British Columbia has taken exception to this proposed bill, and I'd just like to quote a few lines if I may, Mr. Speaker.

They say that the rise of 2 percentage points in the corporation income tax rate in British Columbia as a result of the recent provincial budget has added to the woes of the mining industry. Oh, I thought it was all us, Mr. Speaker, when we were discussing mining in this Legislature.

A recent report by Price Waterhouse and Co. chartered accountants disclosed that the B.C. corporate mining companies in British Columbia had a difficult year in 1975.

"Seven large open-cut operations accounting for 70 per cent of the total provincial corporate production show a combined return on shareholders' investments of 0.04 per cent. What that means is that profits were nil or minimal with some companies while others recorded losses. That rate is far too low to encourage the mining companies to engage in renewed exploration or mine development, to provide additional jobs or to develop new revenues for the provincial treasury, especially when existing taxes and royalties are unacceptable. Copper prices in the world market where B.C. copper concentrates are marketed went up about 10 cents a pound recently. This increase was based on the devaluation of the pound, on interruption of the movement of copper from Zambia and expectation that the race war in Rhodesia might interrupt that flow on a long-term basis."

What I am really saying, Mr. Speaker, is that this government has been telling us for some two years that it was the Mineral Royalties Act that affected mining in this province. I submit to you that it was not. I submit to you that it was the world price of copper, that the Mining Association of B.C. now realizes that it was the world price of minerals that affected the mining industry in this province, an effect that we had all over the province. I'll be doing this speech again under the minister's estimates.

MR. NICOLSON: Mr. Speaker, I rise to speak on this bill. It's very difficult. It's almost as if we were in the federal House and the Liberals had brought down an omnibus bill. Because while we see in this bill some directions which we think are perhaps correct directions for a government that feels it must increase revenues, we also find there are parts of this bill that are at least for myself particularly distasteful.

The NDP, when it was government, brought in two rates of tax, one for small corporations and one for large corporations. Here we see that while that principle is being continued, there is an increase in the rate of corporate tax from 10 to 12 per cent for a small business.

I look in the budget and I see that the anticipated revenues from corporation tax.... I think the anticipated increase in revenue is $31 million. But it is not broken down. I would hope maybe the minister could in summing up or in third reading, if the information isn't available today, give us some kind of an indication of how much money he is intending to raise off the backs of small business. Because there are a lot of small business people trying to stay afloat. I notice that because of certain trends — and bear with me, Mr. Speaker — I must say that such effects as an increase in sales tax are already having an effect on retain sales so that people who have to pay the corporation tax in small business are finding the pinch of this....

I have visited some of the small business people in Nelson on the weekend, Mr. Speaker. They're feeling the pinch. Now these people are not quitters. They are taking an optimistic attitude rather than drawing back.

Some of them are diversifying. For instance, people that have been in the television and electronic sales business are diversifying. I notice here in Victoria, Mr. Speaker, that one electronics firm that has perhaps made good money by selling televisions and stereo sets and components is now bringing in a line with photographic materials and cameras. Because in that field colour television sales have more or less peaked out and it is necessary.

Some of these companies are going through difficult times. We can look and say: "Well, if their profits for last year were $20,000 it only means $200." Well, these people are also going to take salaries out of this, Mr. Speaker. They are going to be hit by increased income taxes; they are going to be hit by other factors. I would hope that if it were at all possible that....


MR. NICOLSON: Well, business people also pay themselves salaries sometimes out of their business.


MR. NICOLSON: Yes, I know, Mr. Premier. I wish you'd pay attention, Mr. Premier. Perhaps you'd follow the remarks. But....

[ Page 871 ]


MR. NICOLSON: Mr. Speaker, the point here is that we have an omnibus bill in front of us. On one hand we are talking about increasing the rate of personal income tax; on the other hand we are talking about increasing the rate of tax to small business corporations; on another hand we are talking about the rate of corporation tax which involves Canadian corporations and also foreign corporations. We are looking at returns, for instance, to mining companies. Maybe at a level of corporation taxes they will have to pay, mining companies that have sweetheart smelter agreements, mining companies that are, perhaps, selling....

AN HON. MEMBER: Name one.

MR. NICOLSON: Well, I could name one which was Bunker Hill, and the Reese Macdonald arrangement, Mr. Member, which was a sweetheart deal quite openly admitted. It's in reports which are in the files of the Minister of Mines (Hon. Mr. Waterland) .

We have on the one hand the international corporations which have arrangements such as selling the ore concentrates at less than 50 per cent of their actual value and profits are taken in the United States to the parent company. Now they are paying a little bit of an increase. We have taxable Canadian corporations whose operations occur entirely within the country, and which are paying a fair rate of tax as all of their operations go on in the country — large corporations.

Then we have the small business, and the small business certainly doesn't have the opportunity to avoid paying tax in one domain and pay it in another, wherever it might be more favourable.

I would like to know how much money. Either in summing up second reading or perhaps during third reading, I would like the minister to answer sometime on how much he expects to get from small business corporations. Is it necessary? Is it $1 million? Could that not have been raised in some other manner?

Mr. Speaker, it is a difficult thing to have to support a bill such as this. It's like an omnibus bill that combines capital punishment and gun control all in one. It really is. The minister smiles — a little bit of knowledge. I know he probably thought: well, we'll get it through a little bit quicker this way, rather than taking them up separately. Mr. Speaker, I will support the bill in second reading, but with a little bit of a heavy heart and some optimism that the minister might consider and reconsider what is happening in particular with small business.

HON. MR. WOLFE: In closing the debate on this Income Tax Amendment Act, I find somewhat of a bemused, confused condition arising — it would appear as though everybody is going to support this Act. Am I correct, Mr. Member?


HON. MR. WOLFE: In any event, I am beginning to wonder what we've done wrong. (Laughter.)

MR. WALLACE: Sit down before you do something wrong.

HON. MR. WOLFE: Mr. Speaker, just a point of clarification regarding the July 1 date on the Income Tax Amendment Act. Many members may realize this, but some may not: amendments to the Income Tax Act, where the provinces are concerned, require some notice. I am told it would require three months' notice. Secondly, they can only be made at two dates during the year, either July 1 or January 1. This would account for the July 1 effective date of the income tax amendment.

MR. MACDONALD: You can make it retroactive to the time.

HON. MR. WOLFE: No, we can't. We have done so on the corporation tax amendment. I might point out that in these amendments, as you can see by the tax tables in the budget speech, the amendments on personal income tax place us above certain important provinces such as Alberta and Ontario, and below certain other provinces like the Maritimes, Manitoba and Saskatchewan. It's important that we be competitive in these rates with the rest of Canada, similarly so in the case of corporation taxes.

As you know, we have a two-tier corporation tax rate. Our rate on the lower scale is still very competitive with other provinces, and it does put us in a higher scale where the higher end of the corporation tax rate is concerned.

I have appreciated the debate on this particular amendment and I therefore move second reading, Mr. Speaker.

Motion approved.

Bill 9, Income Tax Amendment Act, 1976, read a second time and referred to Committee of the Whole House for consideration at the next sitting after today.

MR. SPEAKER: Hon. members, before the House adjourns I have a report I wish to make to the House. On April 9, shortly after the commencement of the afternoon sitting, the hon. member for Vancouver Centre (Mr. Lauk) moved "that the House at its rising do stand adjourned until 2 o'clock p.m. on Monday

[ Page 872 ]

next." Mr. Speaker ruled the motion out of order on the grounds stated in the Votes and Proceedings of that day at page 3. Later, during the same sitting, the hon. member for Revelstoke-Slocan (Mr. King), made a motion in identical terms, and Mr. Speaker ruled the motion out of order, stating that the motion questioned the prerogative of the House Leader to move the adjournment, and stated he would give further reasons to the House.

Perhaps the clearest description of the traditional responsibilities of the House Leader is contained in Beauchesne, 4th edition, page 82:

"All motions referring to the business of the House should be introduced by the Leader of the House."

That is taken from volume 45, page 476 of the Journals of the House of Commons.

"Let us now briefly indicate the influence directly exercised by the Leader of the House on the course of business. It is his task, in the name of the government and the party in office, to distribute over the session the programme of legislation announced in the King's speech and to advocate it in the House. He assumes the duty of proposing all such motions concerning the agenda of the House as are deemed advisable by the government and is their spokesman in the debate thereon. With regard to every government project the leader is the final authority as to its general progress, as to the time to be given to its different stages and as to any application of the closure or other available method of shortening debate and bringing matters to a conclusion. The whole policy of the government, especially so far as it is expressed in the inner life of the House and in measures dealing with the course of its business, is concentrated in his person."

This general subject is further explored in Sir Erskine May's Parliamentary Practice, 16th edition, page 408:

"In the midst of a debate upon a question any member may move 'that this House do now adjourn, ' or 'that the debate be now adjourned, ' not by way of amendment to the original question, but as a distinct question which interrupts and supersedes that already under consideration. The use of the motion for the adjournment of the House to supersede another question, must be distinguished from its use as a substantive motion, i.e. before or between the orders of the day, when it can only be moved by a member of the government."

See page 390 of Sir Erskine May for that.

"It need scarcely be explained that a dilatory motion cannot be made while a member is speaking, but can only be offered by a member who, on being called by the Speaker in the course of debate, is in possession of the House. If this second question be resolved in the affirmative, the original question is superseded and, if the motion was for an adjournment of the House, the House must immediately adjourn and all the business for that day is at an end, and/or if it was for the adjournment of the debate, the last order or notice of motion is proceeded with."

Hon. members will observe this parliamentary rule does not prevent any member from moving an adjournment motion in a dilatory sense, but the motion made by the hon. member for Revelstoke-Slocan to adjourn the House until 2 p.m. Monday next is in quite a different category and was clearly used in a substantive sense.

Under the circumstances indicated the motion is clearly out of order unless made by, or with, the consent of the House Leader.

HON. MRS. McCARTHY: Mr. Speaker, we'll be moving into the continuing debate on the budget and other government business this evening.

Hon. Mrs. McCarthy moves adjournment of the House.

Motion approved.

The House adjourned at 5.54 p.m.