2004 Legislative Session: 5th Session, 37th Parliament
The following electronic version is for informational purposes
The printed version remains the official version.
WEDNESDAY, MARCH 3, 2004
Volume 21, Number 5
|Introductions by Members||8995|
|Statements (Standing Order 25B)||8996|
|Pharmacist Awareness Week|
|Cancer awareness and fundraising|
|Vancouver drug trade|
|Police investigation of government officials|
|Hon. G. Collins|
|B.C. rail privatization process and police investigation|
|Hon. G. Collins|
|Promotion of avalanche safety|
|Hon. R. Coleman|
|Funding for native courtworkers|
|Hon. R. Coleman|
|Hon. C. Hansen|
|Lobbying in B.C. Rail privatization process|
|Hon. G. Collins|
|Interjurisdictional family maintenance agreements|
|Hon. G. Plant|
|Point of Privilege||9000|
|Hon. G. Collins|
|Committee of Supply||9001|
|Estimates: Ministry of Health Services (continued)|
|Hon. C. Hansen|
Proceedings in the Douglas Fir Room
|Committee of Supply||9038|
|Estimates: Ministry of Finance (continued)|
|Hon. G. Collins|
|Estimates: Ministry of Provincial Revenue|
|Hon. R. Thorpe|
[ Page 8995 ]
WEDNESDAY, MARCH 3, 2004
The House met at 2:03 p.m.
Introductions by Members
Hon. S. Hawkins: In the House today is a very special friend of mine who travelled on vacation with me and is now spelling off my family. She is a great nurse, a great colleague and a great friend — Janice Parker-Sparrow. I'm looking for her. Would the House please join me in making her welcome.
If you'll indulge me for a minute, Mr. Speaker. I haven't been here for a month, and I promise I won't speak a month's worth of my time. I feel like I'm at the Academy Awards. If I hear music, I refuse to sit down. I've seen that show. I've seen you, Mr. Speaker, being very creative in the last month, as I've been watching on TV, in trying to get ministers to sit down. I promise I'll try and keep this short.
I want to thank all my colleagues, everyone in the buildings, all the press gallery. People have been so supportive. It's been overwhelming, but it really does make a difference. I think I know I'm not on this journey alone. Your thoughts, prayers and best wishes really have made a difference to me. I mean, I don't even think I could have travelled here today if I didn't know I had so many people caring for me.
I want to thank my staff. I want to thank Jennifer Burnett. I want to thank Karen Bill here for making arrangements. I want to thank the Premier for accommodating my meetings and looking after my duties while I've been gone and for being so supportive and making sure I got here and back okay. My staff in Kelowna have just been incredible. I can't imagine what kind of circumstances they're working in. Del and Shirley have just been an incredible source of support — and my colleagues there, the MLAs for Okanagan-Westside and for Kelowna–Lake Country, in looking after my constituents while I have been unable to. I'm sure you'll have a list of things you owe me like my sisters are writing down, so I promise I will try and fulfil that when I'm better.
I know that you've all heard my sisters' top-ten list, and it seems to have encouraged other people to develop lists. In my absence, I want to thank the staff from IGR. I'm starting to get top-ten lists from different…. People in protocol came up with one in a card that says: "If you didn't want to learn French, why didn't you just say so?" Anyway, I'm not encouraging that, but it is nice to get that.
If I can close with my appeal, because that is what is important to me right now. There is a message to send to people across the province. You don't realize how important things are to you until you lose them, and the significance of some things you are doing until it actually affects you. I have been a blood donor, and now I am a blood recipient with my diagnosis of leukemia. I am learning more about blood donation than I ever wanted to know, but I am learning it and I want to get the message out.
In British Columbia we have a population of over four million, and we donate at half the rate of other provinces. We are a net recipient of blood. We get 15,000 to 18,000 units of blood from other western provinces that have half or one-quarter the population we do. That, to me, is unacceptable. I really hope people will roll up their sleeves and help save a life. It is helping to save my life, and I can't tell you how much I appreciate that — that someone out there, an anonymous donor, has been unselfish and has taken the time to make sure I get what I need in my time of need.
The second thing I am asking for is people to consider registering in the bone marrow registry as an unrelated donor. I am so fortunate that my parents had six kids, me included. One of my sisters, who is three years younger, ended up being a perfect match for my bone marrow transplant. If she weren't a match, I would be in a circumstance where I would be looking around North America, Europe or India for a match. That would delay my treatment, and if a match weren't found, it wouldn't be good news for me.
So I'm encouraging ethnic populations — whether you're Indian, South Asian, Filipino, Chinese, Japanese — to please get registered. We do not donate blood, and we do not register at the rate of eastern- and western-descent populations. So that's my appeal.
Mr. Speaker, thank you for indulging me. I don't hear the music yet, but I will sit down.
I want to thank the opposition and the Leader of the Opposition. She told me to get a life. Maybe when I go back now, I won't watch you guys as much because it's not that exciting to be here, I notice. I do miss you all terribly. Thank you for your support.
Mr. Speaker: Further introductions, hon. members?
Hon. I. Chong: Today I would like to introduce two constituents of mine from the riding of Oak Bay–Gordon Head. They are David and Annabeth Black. They're in the gallery, and they will be watching question period. They are both very strong community leaders in the greater Victoria area. As well, David is a chair of the B.C. Progress Board and does that job very well. They're also very good friends of the Clerk of the House, and I know he would like to see them welcomed here today as well. So would the House please make them both very welcome.
J. MacPhail: On this wonderful day when we have our colleague from Kelowna-Mission with us, I also have great news about Graeme Bowbrick, who is now a former colleague of ours. Let me just read you the message — if I may, Mr. Speaker — very quickly: "Julie" — his wife — "and I want to let you all know this morning that Julie, Charlotte and Meredith were born at just after 9 a.m." Sorry, sorry. Charlotte and Meredith are
[ Page 8996 ]
the twins — not triplets. How to make a tough event seem like nothing…. I'm sorry. [Laughter.]
I'm so sorry, Graeme. Julie is the mom. Graeme is the dad. Charlotte and Meredith are the new baby girls. Charlotte is 5 pounds 5 ounces; Meredith is 5 pounds 15 ounces, and they join their three brothers: Adam, Alex and Colin. Good luck, Graeme.
Hon. C. Hansen: We have several guests in the gallery today that I would like to introduce from the Canadian Breast Cancer Foundation. Dr. Moira Stilwell is the chair of the foundation. She is joined by four other members of the executive for the B.C.–Yukon chapter: Virginia Greene, Jan Engemoen, Greg D'Avignon and Judy Caldwell, who is also one of the founders of Breast Cancer Foundation of B.C. Will the House join me in making them very welcome.
R. Hawes: This week is B.C. Pharmacist Awareness Week. To that end, we have had a visit today from the B.C. Pharmacy Association. They met this morning with about 30 MLAs. In the House today are Peter Hirschmiller, president of the B.C. Pharmacy Association; Marnie Mitchell, chief executive officer of the association; Marion Pearson, a UBC faculty of pharmacy professor; three pharmacists from Victoria — Marilyn Boyce, Larry Thorne and Alan Hickey; and two students from UBC pharmacy — Tiffany Ho, who is the student coordinator, and Eugene Chu, who is a pharmacy student and president of the UBC Pharmacy Undergrad Society. Could the House please make them very welcome.
G. Hogg: There are two residents of Surrey–White Rock here in the House today — one who's recently had an epiphany and moved here from New York. Would the House please welcome Dr. Penelope Peters and Mike Miller.
Mr. Speaker: Hon. members, I would like to take this opportunity to introduce 25 public servants seated in the west gallery, who are participating in a full-day parliamentary procedure workshop. This workshop, offered by the Legislative Assembly, provides a firsthand opportunity for the public service to gain a greater understanding of the relationship between the work of their ministries and how that work affects the Legislature. Would the House please make them welcome.
(Standing Order 25b)
PHARMACIST AWARENESS WEEK
R. Hawes: Every day in every corner of our province there are pharmacists providing advice on medication management, disease prevention and healthier lifestyles. They're an integral part of our health delivery system. For many, the community pharmacist is the first stop for answers to medication questions and health-related concerns.
Pharmacists are the drug experts in health care. They are recognized as the most effective medicine managers and drug information experts involved in patient health care. A recent poll indicates that 90 percent of those polled expressed confidence that pharmacists reduced drug interactions and mixups, especially with seniors' medication. In fact, a 2003 Ipsos-Reid poll revealed that Canadians found pharmacists the most trustworthy professionals when it comes to honesty and integrity.
As our baby-boom generation continues to march towards senior status — and that probably includes a number of us — with the resultant increased financial burdens on our health care system, it becomes more and more important to consider new roles for our health care professionals, including pharmacists. I would urge the Minister of Health Services to ensure that the role of pharmacists as health care consultants is an important part of the scope-of-practice review now underway.
Pharmacists are one of the best bargains in health care today. I would ask all of my colleagues to recognize pharmacists as we celebrate the proclamation of Pharmacist Awareness Week, March 1 to 7.
CANCER AWARENESS AND FUNDRAISING
P. Sahota: There has been a lot of recent discussion about cancer awareness and the important role the public plays in supporting cancer research initiatives. I'm very proud that in Burnaby we're doing just that.
My colleagues from Burquitlam and Burnaby North and I have teamed up with the Burnaby Chinese Parents Association and the Romana Restaurant to raise funds for the Canadian Cancer Society. Tomorrow, March 4, the Romana Restaurant on Hastings Street in Burnaby will be hosting a Spring Romance fundraising dinner with all proceeds going to the Canadian Cancer Society. Thanks to Winnie Fong, Julie Lin, Jackie Liu, Mary Wong, Gilbert Lam, Andrew Shum and Jennie Siormanolakis. I know tomorrow night will make a difference.
On March 12 the tenth Chinese campaign anniversary dinner will be held to raise funds for cancer research and to support programs and prevention information. So far, with the help of people like Johnny Fong, Dr. Michael Lowe and Mason Lowe, this organization has raised close to $3 million for this very important cause.
As introduced earlier in the House, I along with my colleagues met with the Canadian Breast Cancer Foundation, who are here raising awareness and educating all of us on breast cancer and the critical importance of mammograms, as breast cancer is the number one health concern for women in British Columbia. It is important for all of us to work together and raise awareness and educate women on breast cancer prevention.
Of course, I would be remiss if I didn't say it is great to see the member for Kelowna-Mission in the
[ Page 8997 ]
Legislature today. All of us will continue to pray as she goes in for a bone marrow transplant next week.
There are so many British Columbians in our province — like the Canadian Cancer Society, the Breast Cancer Foundation, researchers and countless volunteers — who dedicate their time to raise awareness and funds for cancer research so thousands of people in our province can benefit from their efforts. It's my hope that with world-class researchers and the community spirit of generosity, we will find a cure for cancer. To the many partners, researchers, volunteers and communities: thank you for your continued dedication as we all work together towards a future without cancer.
VANCOUVER DRUG TRADE
L. Mayencourt: Vancouver's drug trade has been a longstanding problem for many neighbourhoods in our world-class city. We have tried to control and to understand it for many years. The reality of the drug trade is that it follows the laws of supply and demand. While the Vancouver police department cracked down on dealers in the downtown east side, they simply moved west, up to Richards Street and into the West End.
It was reported yesterday that as part of a two-week operation focusing on our West End, the Vancouver police department arrested 98 individuals suspected of trafficking drugs. Half of these were repeat offenders. The police laid a total of 147 charges in this operation.
These drug dealers hang around the schools in my neighbourhood. The people of my community are sick and tired of being victims of crime and watching the open-air drug trade happen in our neighbourhoods. We need to ensure that people feel safe as they walk to work and school. We need to work together with our police forces to take back our communities and tell the drug dealers that we are not going to stand for this anymore.
Tonight I will host a meeting about implementing a community safety zone around Lord Roberts Annex, Lord Roberts Elementary and King George high school. One of these schools is situated right beside Nelson Park, a place where needles are found and dealers frequently sell their drugs and harass residents. The school safety zone we will be talking about will protect children from facing some of the daily dangers of this drug problem.
Tonight we will meet at the West End Community Centre at 7 o'clock. Tonight we will also have members of the Vancouver police department, the parent advisory committees from all three schools, the three school principals in the area and many, many concerned citizens. It is my hope that we will be able to provide children and parents in my riding with a safe place to go to school, a safe place to walk home and a safe place to be a kid.
Mr. Speaker: That concludes members' statements.
POLICE INVESTIGATION OF
J. MacPhail: Will the government finally come clean today and tell us why David Basi got fired and Bob Virk got suspended with pay? What is the government not telling us about what they knew about the activities of David Basi that was not in the summary of the warrants released yesterday? Bob Virk is still on the public payroll, when his actions, according to the summary, are no different than Mr. Basi's. Can the Deputy Premier tell this House what the Premier and his chief of staff know about what was going on in the Finance minister's office that they aren't telling the public?
Hon. G. Collins: I answered that question yesterday in estimates. I answered it two months ago, and I answered it yesterday in the corridor.
Mr. Speaker: Leader of the Opposition has a supplementary question.
J. MacPhail: Well, maybe the Minister of Finance is having a conversation in his own mind. He has not answered that question at all.
When the police raided the Finance minister's office, that Finance minister assured British Columbians that David Basi had no role in the sale of B.C. Rail. The summary released yesterday directly contradicts the Minister of Finance. Mr. Basi was up to his eyeballs in the B.C. Rail deal, and it is inconceivable that the Finance minister did not know that.
In fact, we know that Mr. Basi was directly involved in lobbying stakeholders — Colin Kinsley, the mayor of Prince George, to name one, as well as others — to support the Premier's broken promise. Will the Minister of Finance now admit that his chief political aide was directly involved in the sale of B.C. Rail and had access to confidential information?
Hon. G. Collins: Mr. Speaker, if she checks the record from the end of December, she'll find the answers to those questions as well. As well, we talked about it yesterday in estimates for several hours, and I answered it as well.
Mr. Speaker: Leader of the Opposition has a further supplementary.
J. MacPhail: In fact, checking the record shows that this minister and this government said that Mr. Basi had nothing to do with the B.C. Rail deal. That's exactly what the Minister of Finance said.
Another incredible statement yesterday by the Premier. The Premier said yesterday that the investigation has nothing to do with his government. If the matter weren't so serious, that statement would be laughable. The Premier also said that he would gladly run for re-election on his broken promise to sell B.C. Rail.
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I can't wait. I wonder what part of the deal the Premier will feature in the ads — the broken promise, the criminal investigation, the stonewalling, the Finance minister. The Premier and the Finance minister know more than they're telling.
Erik Bornman is a registered lobbyist for Omnitrax, and Mr. Bornman lists the Minister of Finance as one of his lobby targets.
Mr. Speaker: Order, please. Order. Hon. member, may we have a question, please.
J. MacPhail: Can the minister…
Mr. Speaker: Now, please.
J. MacPhail: …tell us if he ever met with Mr. Bornman, and who else was in the room?
Hon. G. Collins: I never met with Erik Bornman. I'm sure the Premier will be thrilled to go to the public with that as an election issue — the fact that we revitalized B.C. Rail. Communities along….
Hon. G. Collins: Mr. Speaker, if she wants to ask a series of questions, she can get up and ask them in the normal order of the House. The fact of the matter is that I never met with him. How many times does she want to ask me that?
The fact of the matter is that the Premier and every single member of our caucus will be excited about talking about the revitalization of B.C. Rail — as well as will all the mayors along the communities, as well as the mayor in Prince Rupert, as well as all the communities and all the jobs they're going to receive as a result of that action.
B.C. RAIL PRIVATIZATION PROCESS
AND POLICE INVESTIGATION
J. Kwan: The former Minister of Children and Family Development resigned when he was informed of an audit into a forgiven loan — a decision that the minister wasn't involved in, according to the government. The Premier praised the minister. Let me quote the Premier: "He's acting in the best parliamentary tradition, and I think that speaks to the quality of the man." Today the Minister of Finance's top aide and chief political adviser is under criminal investigation for breach of trust and influence-peddling in the B.C. Rail deal.
To the Deputy Premier: if the former Minister of Children and Family Development was acting in the best parliamentary tradition, why is the Finance minister still in his job when the police are investigating criminal activities in his office?
Hon. G. Collins: I answered this question, as well, yesterday, and I think I answered it previously as well. The difference here is that I am not subject to an investigation, nor is there an investigation taking place within my ministry that would report to me, which is different than the situation of the minister she talked about.
Mr. Speaker: The member for Vancouver–Mount Pleasant has a supplementary.
Mr. Speaker: Hon. members, the member for Vancouver–Mount Pleasant has the floor.
J. Kwan: Well, talk about a double standard. Here's what the former children's minister said when he resigned: "As parliamentary practice dictates, when these clouds are cast, one makes the decision to step aside." The police were never in the office of the former Minister of Children and Family Development. There is no criminal investigation, at least that we know of, into the conduct of his staff. He resigned over a forgiven loan that he says he has nothing to do with.
Again to the Deputy Premier: why is it honourable for one minister to resign to protect the integrity of his office and not for the other? Why is the Minister of Finance getting special treatment from your Premier?
Hon. G. Collins: It doesn't feel like special treatment. The difference is that there is an internal investigation that's taking place in the ministry, which would need to report to the minister. There is no investigation in the Ministry of Finance that is reporting to me. There is an external investigation that's undertaken which does not include me, which does not include any elected member or any elected official. The police have been very clear about that right from the beginning.
PROMOTION OF AVALANCHE SAFETY
W. McMahon: My question is to the Solicitor General. The federal government recently followed B.C.'s lead and announced funding of $525,000 over three years to establish a national avalanche centre. This was one of the key recommendations of the report that was recently submitted by the B.C. public avalanche safety program review and comes as welcome news to many of my constituents, to people nationally and also internationally. Can the minister advise my constituents what his ministry is doing to support avalanche safety in British Columbia?
Hon. R. Coleman: When we came to office, there was an avalanche bulletin in British Columbia that was published by the Canadian Avalanche Association. It was funded from a number of ministries sort of at the end of the year — $5,000 here; $10,000 here — to the tune of about $40,000 on an annual basis. As we went through a very significant, devastating avalanche year
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last year, it became obvious that we needed to enhance that bulletin. So we put some extra bulletins in place so people would know when they're going into the back country where the dangers were and where to take caution.
At the end of the season, in my ministry we worked towards finding funding for a three-year cycle at $125,000 a year, which is more money than the avalanche bulletin had ever had in the past from all contributors to the bulletin. We thought if we took the initiative to do that, we would then be able to move towards a national avalanche centre which would do bulletins on a regular basis, if we could attract other funding from other levels of government.
Our initiative led to the funding from the federal government. I hope that at some point in time Alberta will also come to the dance with us so that we can have a long-term, sustainable avalanche bulletin and information centre for people who go into the back country of British Columbia. I am proud of our government for stepping up and taking the leadership in this, and I am proud of the fact that our officials have been able to put it together.
FUNDING FOR NATIVE COURTWORKERS
P. Nettleton: This year the Native Courtworker and Counselling Association of B.C. is preparing to celebrate 30 years of extraordinary and exemplary service as an integral part of the justice system. The Solicitor General has a special birthday surprise for this dedicated organization and the people they serve provincewide. He is about to huff and to puff in an attempt to blow their candles out.
On February 27 of this year the Native Courtworker and Counselling Association were notified by the same minister that as of April 1, their funding would be reduced by 36 percent. This follows on the heels of a 20 percent reduction in June 2002. With this further cut next month, 50 percent of the native courtworker positions will have been eliminated by this government, leaving fewer than 20 front-line workers to serve the entire province.
Mr. Speaker: Order, please, hon. member. May we have the question now, please.
P. Nettleton: Yes. The number of clients has risen by a staggering 73 percent since 2002.
Mr. Speaker: Now, please.
P. Nettleton: My question is to the Solicitor General. Without blowing smoke in our eyes about alternative service delivery models and referencing federal funding, will you reconsider and commit today to review this funding cut and thus follow through with your government's commitment to consult with first nations prior to making such arbitrary decisions?
Hon. R. Coleman: Indeed, the member is correct. We have advised the native courtworkers that we will be cutting their funding this year. The fact of the matter is, though, that we've been in discussions with the native courtworkers as to how we can harmonize some of the programs for people in the justice system with our programs in the correction centres, as we have done with other programs, to get more efficiencies. We also recognize that this is going to put some stress on them, so we're in consultations as we do the transition, but we have forecast this back two years in discussions with the native courtworkers as a transition to how we'll deal with these programs. That's just what we have to do, unfortunately, when we have to make tough decisions.
R. Stewart: As we've heard today, the blood inventory in British Columbia is lower than it should be. This is of great concern to me as a longtime blood donor and to my family and to my constituents and to people across this province. I know that the concern was brought home even more to this House by recent events. Can the Minister of Health please tell us what we can do to ensure an adequate supply of blood products in British Columbia?
Hon. C. Hansen: I don't think I could say it more eloquently than our colleague from Okanagan-Mission said earlier. It is incumbent upon all of us who can give blood to take the time to do that. I know I'm booked in for a week this Friday, which is my 56-day mark, because you can give once every 56 days. The short answer to the member's question as to what we can do to make sure that we have an adequate supply of blood product in British Columbia: we can all roll up our sleeves.
B.C. RAIL PRIVATIZATION PROCESS
J. MacPhail: We have the lobbyists' registration in British Columbia here. It provides very interesting information. Erik Bornman has lobbied, or claims to have lobbied, this government on many files. Now, he's a good Liberal. Maybe he's not telling the truth. On his B.C. Rail file, he filed to say that he lobbied the Premier, the Minister of Finance, the then Minister of State for Deregulation, the Minister of Energy and Mines, the former Minister of Transportation and the current Minister of Provincial Revenue — I guess that's the job he's got now. Is Mr. Bornman lying on the lobbyists' registration? If so, is he lying about all the other files on which he lobbied the Minister of Finance as well?
Hon. G. Collins: If the member understands the act and takes the time to read the act, she'll know that the lobbyists have to register their intent to lobby. They may or they may not. I have never met with Erik
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Bornman on any issue since I've been elected as a member — since 2001.
FAMILY MAINTENANCE AGREEMENTS
S. Orr: My question is to the Attorney General. A number of my constituents, and these are predominantly women, depend on family maintenance from their former partners.
S. Orr: This is an issue that's very important to women, so let's deal with this.
To provide for their children a safe home…. During the 2002 spring sitting we introduced legislation that would help hasten interprovincial family maintenance orders. Can the Attorney General explain how this legislation has helped in the collection of support payments when an ex has actually moved to another jurisdiction?
Hon. G. Plant: Thanks to the member for the question. The Interjurisdictional Support Orders Act was enacted by this House in 2002 and brought into force the next year. We were leaders at that time. Since then, every other province in Canada has enacted similar legislation, and we now have agreements with all of the provinces and territories and all of the states of the United States and a number of other countries that make it easier to enforce maintenance and support orders across jurisdictions. Essentially, the major element of the process is that instead of having to go to court twice — once in this jurisdiction and then once in the other jurisdiction — you now have to go to court only once in the jurisdiction where the payer lives.
The goal here is to reduce legal costs to ensure that people get access to the support payments they need quickly. Early indications are that people are taking advantage of the opportunity and the program is being used, and I believe that we see a success story in the making.
[End of question period.]
Point of Privilege
Hon. G. Collins: I rise today to respond to a matter of privilege which was raised by the member for Vancouver-Hastings. On the afternoon of Tuesday, February 10, the member rose in her place to reserve her right to raise three matters of privilege. It's worthy of note that the member did not reserve her right at the earliest convenience, which is a strict requirement of the standing orders of this House. The failure to do so has resulted in members losing their right on numerous previous occasions.
I'd refer the Speaker to the ruling of Mr. Speaker Schroeder of November 25 and 26, 1982, which is definitive and strict on this issue. The member's earliest opportunity was at 10 a.m. on February 10, before the House had prorogued. Rather, the member chose to wait until the afternoon for maximum attention to raise the issue immediately after Her Honour the Lieutenant-Governor had left the chamber after delivering the Speech from the Throne.
However, with regard to the substance of her assertion, the member deals with two issues: first, that the increase in tobacco tax is illegal; and second, that the increase in the existing tax rate constituted "a contempt of parliament" in that "the minister has violated the supremacy of the Legislature and our rights as MLAs to vote and represent our constituents before the tax is announced and collected."
With regard to the first point, the legality of the tax is not the subject of a privilege motion but rather a matter for the courts. Governments regularly introduce legislation to retrospectively amend taxation legislation. With regard to her allegation of contempt of parliament, it would be impossible for members "to vote and represent our constituents before the tax is announced" because, simply, there would be nothing to vote on.
If it was the announcement itself that offended the member, I refer the Speaker to the Journals of this House of April 10, 1990, and the ruling of Mr. Speaker Rogers who makes it clear that the presentation of a proposed charge or tax on the public in a venue other than this chamber does not constitute a prima facie case of privilege. The issue is rather whether it violates all members' right to vote before the tax is collected.
As I said on February 11, it has never been the government's intention to infringe on the rights of the Legislature. This tax increase is clearly subject to the will of the Legislature, as all taxation issues are. In addition to the documents tabled by the member for Vancouver-Hastings, I'll submit to the Speaker a copy of tax bulletin No. 49, the tax notice and the wholesale dealers' inventory return with regard to this issue, which clearly state the intention of the government.
As well, my comments of December 19 to the public were clear. I stated it was the government's intention to introduce legislation in February that would increase the rate of tax on tobacco retrospective to December 19 or 20 of 2003. It was and remains the role of the Legislature to validate that increase or not. The members will decide. As I also stated on February 11, if the House declines, the government would need to return those moneys collected to the wholesalers who have paid it.
Further, it is not unheard of for taxes to be collected before the House has voted. I refer you to Erskine May's sixteenth edition, page 698, as it pertains to the general rules of financial procedures where it says: "It will be useful to summarize here the effect of the financial standing orders with respect to showing which of the general rules of financial procedure they prescribe and to which kinds of financial business they apply these rules. It will be seen not only that they cover a
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comparatively small portion of the field of financial procedure, but also that they need help from 'practice' to cover that portion effectively."
Further to that practice, it has not been universally held that all taxation must first be passed by parliament before it can be collected. I refer, Mr. Speaker, to page 759, subsection (7) of the same document, where it contemplates "provision for making a charge with retrospective effect, from the date before that on which the bill becomes law." Pages 795, 796 and 797 refer to the provisional collection of taxes subsequently validated by an act of Parliament.
Mr. Speaker, as I said previously, it is not the intention of government to infringe on the longstanding right of parliament to raise revenues. Only parliament has the ability to validate and authorize the collection of taxes. However, it is not an unheard-of practice for parliament to validate the collection of taxes retrospectively, as I've shown.
Indeed, to the contrary, I've been unable to find even one example of a prima facie case of privilege that has been found by any Speaker in a similar case. I note that the member opposite could not and did not.
Mr. Speaker: The Chair has now heard from both sides in this issue and will bring back a ruling in due course.
Orders of the Day
Hon. G. Collins: I call Committee of Supply in this House. For the information of members, we will be dealing with the estimates for the Ministry of Health. In the small chamber, we'll be dealing with the estimates for the Ministry of Finance.
Committee of Supply
The House in Committee of Supply B; J. Weisbeck in the chair.
The committee met at 2:48 p.m.
ESTIMATES: MINISTRY OF
On vote 25: ministry operations, $10,404,260,000 (continued).
J. Kwan: Yesterday I was canvassing the minister about the lay of the land, if you will, about long-term care facilities around the province. The minister had advised that with respect to closures of residential care beds or long-term intermediate care beds to date…. He had broken that down for me and advised of the number of beds that have been closed in the different health authorities. I've added those numbers up, Mr. Chair, and that gives me a total of 2,369 beds that have closed. That is from the five health regions.
Keeping that number in mind, I now want to turn to the report that I was referencing yesterday, Meeting the Ongoing Care Needs of Seniors and People with Disabilities. A Planning Model: Home Support, Assisted Living and Residential Care Services, which was developed by the ministry itself in January of 2003.
Yesterday the Minister of Health had advised that perhaps some of the information contained in this report may well be out of date, and I was asking the minister if he has available information that is perhaps more current or another model or plan in place in dealing with the home support, assisted-living and residential care services. Perhaps we could start with that. Could the minister advise me if there's new documentation with respect to that planning model? If so, what information can he offer from his own documentation?
Hon. C. Hansen: I did have a chance to look at the document she was referencing yesterday. We managed to dig it out. It was a document, as we talked about yesterday, that went back to January of 2003. It was policy options, as we discussed yesterday afternoon, and it really sets out the various opportunities to shift care from that intensive, dependent, residential model to a more independent model with appropriate home and community supports in place to support even the most complex of seniors — in some cases where that's appropriate.
That is still an ongoing discussion within the ministry and with others that we are consulting with on that file. As yet, no decisions have been made with regard to the various options that were set out in that document. Those are still the options, ranging from the very low shift to the very high shift. At the end of that, once the decision is made, then obviously that will in turn determine the number of assisted-living beds that may be required to be opened and constructed and the number of complex care beds that will need to be maintained or perhaps renovated or upgraded. As a result of those decisions not yet being made, I can't give her a specific answer.
J. Kwan: When does the minister anticipate that he will know which option he would choose?
Hon. C. Hansen: There is a lot of work being done now with the health authorities on this file. I would hesitate to give a time line on it at this point, other than that we're trying to move forward on it as quickly as possible obviously, because there are some fundamental decisions regarding the nature of the kind of care facilities we may need in the future, once we determine the option that is the most desirable. I apologize to the member. I can't give her a specific time frame at this point other than to say that we are working on it and would like to get through it as quickly as possible.
J. Kwan: The planning that the document refers to goes through several cycles in terms of time line. It looks at 2006 and 2007, and then at 2011 and '12, and
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then at 2016 and '17 with population projections. Can the minister advise whether or not he's working on a long-term plan with the ministry that goes beyond '06-07, or is it just up to '06-07?
Hon. C. Hansen: The planning that we are doing really does go much beyond 2006. We are looking to 2010 — we're looking to 2020 in many cases — to try to anticipate the needs that will be there on behalf of the population as we go forward. I think it's something that our Premier has driven throughout government, and that's that we can't just look to the next quarter, the next year or the next election. We have to look much beyond that if we're going to take a responsible approach to our challenges.
I think it's probably the first time, in B.C. certainly, that we've ever had the kind of long-term planning that we see now. Certainly, when it comes to planning the number of community care beds in the province, that is no exception. There are models being put in place that take us into those out years.
I think the thing that's important to remember is that we are also designing in flexibility, because even as we start to anticipate the needs in the health authorities two and three years from now, we know that there still needs to be flexibility — even in that time frame. As we go forward, for example, with a request for expression of interest around an assisted-living or a complex care facility, it's only when we get out in the community that we realize there are other ways of meeting those needs. We need to be flexible. Yes, we are planning long-term, and we are doing so with the kind of flexibility that we think is responsible.
J. Kwan: I should have asked this question earlier on. That is, with this planning document that I referenced…. While the government has not decided on which option to choose to move forward with, presumably the data and the facts contained in this document are valid. Am I right in making that assumption?
Hon. C. Hansen: What we are trying to do is the kind of modelling that will allow us to anticipate the needs of communities. There's a lot of work being done around designing the appropriate tools that can help us in that forward-planning exercise.
The main purpose behind the document that the member is referencing is to set out the options we have with regard to the degree to which we should shift from that 24-hour-a-day dependence model to one that has more independence but with appropriate support. Yes, there is data in that which helps to guide the choices when it comes to those various options that are set out, but I think that if we were to rerun the same model with the new data we have, it might come out with different numbers.
I think what's important is not the actual numbers that are in that particular document but the options that are being set out and the choices that are there for the kind of care we would be able to put forward to make seniors' lives more enjoyable and more independent in the years ahead.
J. Kwan: Well, there's some information here that I think is important, which I'd like to canvass with the minister, and it's based on the facts in this report.
It does refer to the different options. Given that the government has not decided on which option to choose, let me then just ask the questions around the facts. We can then review them under the different scenarios of whatever option, at the end of the day, the government chooses.
In this report it advises under the introduction section — and I will quote from it — in terms of the anticipated population change. It states that the population of seniors aged 75-plus is expected to increase by 51,000 between 2000-01 and 2006-07 — a 21 percent increase; by 77,000 between 2000-01 and 2011-12 — a 32 percent increase; and by 109,000 between 2000-01 and 2016-17 — a 45 percent increase. Then it goes on to talk about proportion of total population, etc. I'll just stop there and focus in around the population change.
Let me start with this set of facts. Is it the minister's opinion that this set of facts are in fact correct, and that those are the facts which the ministry's working with to determine what option to choose and what plan to move forward on, with respect to ensuring that there are adequate housing options — including intermediate and long-term care housing options — for seniors?
Hon. C. Hansen: The stats that are contained in that report would come from B.C. Stats. We rely on them for these kinds of population numbers but also for the projections in terms of population growth in various age groups. As the member knows, B.C. Stats has a very good track record with the accuracy of their information, and we certainly depend on it.
They do update their numbers annually, so from year to year their projections may change. Whenever we go into a new planning process, we in fact rely on the most recent B.C. stats that might be available. I believe that those stats are available on the B.C. Stats website, but certainly that is the source of our information.
J. Kwan: Then on that basis, I think it is safe to assume that these numbers are accurate at least until the next update, so I will go with what is contained in this report.
These series of questions that I'm asking…. I hope at the end I will be able to weave them all together. Right now I just want to establish certain facts within it so that I know what the assumptions are that the government is working with, so that hopefully at the end, as I say, I can weave all the questions together to make my point.
The other set of information here that I would like to confirm with the minister is with respect to eligibility criteria in terms of determining which clients should go into what type of care facility. In the docu-
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ment it states: "Under the new complex care criteria" — which we went through yesterday — "the majority of clients that are assessed as high-end intermediate care" — that's IC 3 — "or extended care are anticipated to continue to be eligible for residential care" — I assume the term "residential care" is the new term replacing extended care — "while the majority of those assessed at the lower-end intermediate care level, IC 1 or 2, would no longer be eligible." Is this still the policy of the government?
Hon. C. Hansen: I think the first thing I want to point out is that the term "residential care" is not a new term. I think yesterday we talked about how that is defined. It covers a whole series of different types of housing options and care options for seniors. To say that for individuals that have a higher level of acuity — what we would know of as complex care, for example — that residential care will still be an option for them…. Yes, that's true. But we also, as we are planning, are trying to look at what additional options we can give to seniors regardless of their level of acuity.
I think, as we were discussing yesterday, there is lots of evidence that even seniors with very high-level care needs can still be allowed to maximize their independence. You know, we can have individuals with very high levels of needs that can still be supported in their family home with care being provided.
What we're trying to get to and what we are moving towards is not trying to say: "Okay, someone is assessed at this particular classification through the assessment tools, so therefore they have to go to place X." What we're saying is: let's assess the needs of the individual, and then let's look at the range of housing options that may be appropriate for that individual. Then let's work with the individual and family and sort of say: "How much independence do they want? Do they still want to be maintained in a family home?" That may not be possible if the complexity of their condition is quite acute.
The intent is to first of all provide for assessment that can, in a very objective way, determine what their needs are, and then let's look at the housing options which could be a residential care model. It could be supportive independent living with outside supports that are there for the individual. It is a range of options that we're trying to build towards so that seniors in fact have more choice in the future.
J. Kwan: According to this report — my read of it, at least — it indicates that what the minister has just put on record has already been taken into consideration. Arriving at the statement around the new complex care criteria, around IC 3s or extended care, they are anticipated to continue to be eligible for residential care, while the majority of those assessed at the lower-end intermediate care level — IC 1s and 2s — will no longer be eligible. When I read this report, it seems to me that what the minister has said has already been taken into consideration. Then, with that, they have arrived at the suggestion of how to provide the options and come up with the numbers for the options in determining how many beds will be needed under the different scenarios.
If we keep going down the road on which the minister wants to go, it would appear to me that the ministry is not going to be capable of actually nailing down any ballpark numbers to work with and therefore be able to work towards a target of establishing how many beds are needed at what level for the future years. If we just keep saying, "We'll move as things sort of move along," that's no kind of planning, in my view. If you are going to plan — as the minister says he wants to do and as this government intends to do — well, you have to nail down some ballpark numbers somewhere along the line and then work towards those targets. If we're not going to do that, if you have no targets, then I don't know what it is that the government is planning towards. That creates a great set of difficulties, I think, for the government.
Maybe it is intentional from the minister's side to say, "We don't have any targets," so that he can get up, or…. For the government to say, "Well, we met those targets because we never had targets to begin with," or to erase the targets they had first set out…. To me, it would simply not work. It would seem to me that it would simply not work.
Going back to the document, let me put on record, then, what the document actually refers to in arriving at the statement that I put on record earlier. It states, "In order to increase the flexibility and responsiveness of the home and community care system and to ensure residential care beds are available for complex care clients who require that type of intensive setting, the admission criteria for residential care were revised in April 2002" — which refers to the residential access policy. Then it refers you to an appendix, actually. Unfortunately, the appendix in this copy, in any event, is blank, so I don't know what the policy is.
I think the minister yesterday read out the policy with respect to admission, and so let me just ask this question. The policy that the minister put on record yesterday with the conditions or the requirements for the different types of admissions, or definitions for IC 1s, IC 2s, IC 3s, etc. — am I correct in assuming those are the residential access policy that the government is now using?
Hon. C. Hansen: I think the member is confusing two aspects of this file. One is the assessment that needs to be done. As we talked about it yesterday, what we had in place before was assessment definitions which would include the need for — I think we did talk about them yesterday — the IC 1, IC 2 and IC 3 and extended care. I shared with her some of those definitions. What we are moving towards is the new assessment tools under the interRAI assessment tools, which are far more refined. Out of that assessment it will determine what the care needs of the individual are. It's looking at their level of mobility and the
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amount of support they may need from the health care system. Only then do we start looking at what the accommodation needs are of that individual. Based on the assessment, we will determine the level-of-care need, and then we will sit down with the individual and the family to set out what choices are there.
Now, if you have got someone who is assessed at a low level of acuity where they still have an opportunity to maximize their independence in their life but they need some supports, we're not going to give them a choice of the complex care environment. That was really what I think many seniors were faced with in the past. They would get to a point in their lives where they could no longer maintain the family home, so the only choice available for them was what we used to think of — well, we would still today think of — as the nursing homes where there was a 24-hour-a-day, seven-day-a-week loss of independence.
This whole range of choices we are setting out include these variety of housing options with care components to them. Once we've done the assessment, we determine the care needs of the individual. We look at what kind of supports there are from the family or other options, and then we can sit down with the senior and possibly the family members, as well, to determine what the appropriate accommodation needs are. Then we try to work with the families and the seniors to make sure that they can maximize their independence, because we know that is what leads to a fulfilling life for seniors in their senior years, even when they do require a certain level of care.
J. Kwan: The minister did advise this House yesterday that the new assessment tool and the new category or term being used fall into at least one group called the complex care group. Then he advised that it goes from A to E, depending on their situation. Generally speaking, we had a bit of discussion about that as well — that these are more or less similar to those now in extended care facilities. I think we established that yesterday.
The minister was not able to give me the other definition, which I believe is the assisted-living definition. He advised, Mr. Chair, that I would get that by the end of the day yesterday when estimates ended. My office still has not yet received that information, but nonetheless we will continue on with a discussion, setting aside what those definitions might be.
Having said that, what I think I just heard the minister also confirm is that according to this report, the residential access policy, which was revised in April 2002 — and that is the admission criteria — has taken into consideration the new categories in terms of options of care and housing options that the minister references.
The point I want to make with this report, which I want to establish, is that the report takes that into consideration. Then it goes on to say, in addition to what I read off earlier: "This policy is further strengthened by the concurrent implementation of a comprehensive standardized interRAI assessment tool in progress, which supports the decision-making of case managers regarding appropriate care settings." I assume that in that language it incorporates all of what the minister talks about — that is, to assess the person accordingly, to talk with the family and then arrive at a decision where the individual or couple, whatever the case may be, should go.
Then following that sentence the report goes on to say: "Under the new complex care criteria, the majority of clients that are assessed as high-end intermediate care, IC 3, or extended care are anticipated to continue to be eligible for residential care while the majority of those assessed at the lower-end intermediate care level, IC 1 or IC 2, will no longer be eligible."
On that basis, I am assuming that's the premise with which the government is working and that's the policy decision, and then that is how the options and the numbers associated are derived. That's all I wanted to establish — that we are working with the right assumptions. Those are the policy criteria the government is working with. This report had taken all of what the minister had said into consideration, and they still arrived at the statement, saying that those assessed as high-end intermediate care, IC 3, or extended care are anticipated to continue to be eligible for residential care, while the majority of those at the lower end will no longer be eligible.
Am I right in making that assumption, taking into full consideration what the minister has said about assessment with regard to the individual's needs and having spoken with their family?
Hon. C. Hansen: I think the key word in that document that the member read out is: "Those who are assessed with a high level of need are eligible for…." It is not saying we're going to put everybody into a complex care facility if they're assessed as a high level of need. The evidence does show that even those with the highest level of need can be accommodated in different types of accommodation, if there are appropriate supports. They can even be accommodated in their own homes, in some cases.
What it goes on to say is: "Those that are assessed with a lower level of need would not be eligible for that complex care." That is exactly the case, because what we did in the past with individuals who had a low level of need and who could no longer maintain themselves in the family home really had no other choices out there than the nursing home. I think we all know from family experience that seniors dreaded the point in their lives where one of their family members would come and say: "It's time; we're going to move you into a nursing home." That's in a model that, in the past, has had a total loss of independence.
We also know from evidence that if an individual has a lower level of need and still has the ability to direct their own care, still has the ability to live a semi-independent life, to put them into the old style of nursing home where they totally lose their independence will actually result in them deteriorating very quickly.
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It won't take very long before in fact they are living a life that is totally dependent, and they will lose their ability to maintain an independent lifestyle. To take someone with a lower level of assessed need and put them in a high level of care with 24-hour-a-day dependency would certainly not be doing those individuals any service and, in fact, could lead to a quickened deterioration of their health status.
J. Kwan: Maybe we can just step back for a moment. It seems to me the minister is very defensive about this situation here. All I'm trying to do, Mr. Chair, is establish some facts based on the government's own report so that I know what assumptions we're working with and then arrive at, I hope, a reasonable debate and gain a better understanding of how the government is planning to meet the needs of our community. That's all I'm doing.
We don't need, at every question I ask on the confirmation of facts or the basis of information, the minister to advise me about the need for options of care and to take into consideration the changing needs. I fully appreciate that. I can't reiterate any more than I already have that I fully appreciate that each individual will be assessed accordingly. Then the families will be engaged in a discussion with the individuals and with the health care professionals, and will determine what the best housing option for them is, with full flexibility of whatever those options might be.
The report actually states that. The following sentence, after I stated about those who are not eligible, goes on to say: "With the addition of assisted living to the care continuum, it is anticipated that many of the clients that would have gone to residential care will now go into assisted living. Others may remain at home or move to a cluster care setting with enhanced home support services. Such changes will expand the range of available options." It goes on to talk about the impact of admission criteria, changes in the types and numbers of residential care beds, etc. Then it goes on to talk about the aging residential care facilities, and so on.
I fully appreciate what the minister is saying. All I'm trying to do at this point is establish the basis of the assumptions on which we are engaging in this discussion. That assumption, according to this report, has already taken into account the notion of ensuring that there is proper assessment, that there is discussion with the families and that assisted living or staying at home or other kinds of enhanced home support services would be available for the individual to expand the range of available options. It talks about that.
Even when it talks about that, it still states, though, that under the government's assessment criteria to date, they anticipate the majority of clients that are assessed as high-end intermediate care — that is, IC 3 or extended care — will continue to be eligible for residential care, while the majority of those assessed at the lower-end intermediate care levels, IC 1 and IC 2, will no longer be eligible. I think we have established that that's the basis on which the government is working.
We've got to land somewhere. The notion of targets and how we are trying to get towards some targets…. We've got to build in some targets. If, in fact, all of this stuff is not correct or the minister deems that it has not adequately taken into account the notion of providing full housing options to seniors, then the options that are before the government right now — the three options…. Even though they have not arrived at which option to choose, it would say that all of those options are irrelevant, because the numbers and the assumptions and the accuracy of the data are not the basis which the government is accepting.
I assume that's not the case. I assume the government is accepting the basis of these assumptions and these facts. They have the three options before them. At some point they will arrive at choosing which option. Am I right so far?
Hon. C. Hansen: Certainly, what the member has read out in terms of the assumptions and the directions that she has quoted…. Obviously, they're in the document, and I don't take any issue with them, if that's the answer she's looking for.
J. Kwan: Well, yes.
In that vein, I'm also asking if that's the assumption that the minister is accepting — not to advise in this House or answer my question with respect to whether or not I've read the paragraph correctly. I know I've read the paragraph correctly on the record, so I don't need confirmation on that. What I need confirmation on, though, is that those are the assumptions that the minister is accepting, and that's the basis which the minister is working towards in building what needs to be done in terms of home care options for seniors.
[K. Stewart in the chair.]
Hon. C. Hansen: Basically, I just want to reiterate that I think we've covered this before. The document that she's got is a planning document, and it is to set out options and to provide guidance as we move forward to try to find the right mix of care in the future. The sections that she read out…. I haven't got those sections right in front of me today, but I'll take her at her word that she's read them. We can move forward on that basis.
J. Kwan: I don't know why the minister is actually trying to be so evasive about it. I mean, he wants to confirm that I've read the information onto the record correctly.
The minister says, Mr. Chair, that he doesn't know what the question is. The question is this. I want to see whether or not I can get confirmation from the minister that the assumptions contained in this report, which I've read onto the record, are the assumptions which the government is working with — that these assumptions on the projected eligibility criteria, on the projection of who would be eligible and who would not be
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eligible for intermediate care, etc., are the assumptions that the government is working with.
Without those assumptions, without confirmation of this fact, then I don't know how the government could plan ahead to say how many care beds would be needed. Even though within the three options in the report….. The minister has stated that they have not decided on which option to choose. In arriving at those options, this report advises that it used these facts and the information contained in it to formulate the three options. What I'm seeking of the minister is, I think, quite simple, and that is for him to confirm that the assumptions and the facts contained in this report are the premise which this government and this minister are working with.
Hon. C. Hansen: I'm starting to get a better understanding as to what the member is asking for. The assumptions that are written into this document allow us to move forward on developing the models necessary, but the whole thing is a planning document. Have the assumptions been signed off on? No. The assumptions are here in this context, in this document, as part of a planning process to allow us to develop the model.
I think that as we move forward with the policy that will flow from this, then clearly we have to not only challenge the model; we have to challenge the assumptions. Only then are we going to be able to arrive at a final policy. Once we come to a conclusion of this process and we've actually developed the policy, I would be pleased to share with anybody who's interested what the final assumptions are that allowed us to lock into a policy direction to move forward.
J. Kwan: This is a bit troubling. What the minister is basically saying is: "We have no targets towards when we will arrive at…." I shouldn't say that; I'm sorry — not "no targets." He actually advised earlier that he does not know when he'll have the information sufficient for him to choose which option to go with in terms of planning for 2006, '07 and years beyond. Earlier today he said he doesn't know when he'll arrive at that decision.
Now, with respect to even basic information on…. Then he also advised that given the three options outlined in this planning document…. He said that they have not chosen an option because they are still working towards arriving at that decision. He doesn't know when he'll choose what option. He doesn't even know, of the three options, whether or not — it sounds like — these three options would in fact be valid options for consideration, because he just said the assumptions that this report had used to derive the three options are now in question. The minister himself is not sure whether or not those assumptions are accurate.
Well, then that means the minister has got nothing to work with. He has no targets, he has no time line, and he has no basis of facts to use to determine what he wants to plan towards, and that is the concept of meeting the needs of seniors and fulfilling the New Era document commitment for 2006 and then years beyond. I find that rather shocking.
If the minister advises that he's got…. The assumptions in this report that I'm asking him questions about are assumptions that he said we're not necessarily committing to and we don't know whether or not we will accept them. Well, then maybe the minister can start off by telling me what assumptions and what facts he is using as he is planning towards arriving at a decision in terms of how many care beds will be needed and what kind of care beds will be needed for 2006-07 and years beyond.
Hon. C. Hansen: I think the comments the member just made underscore for me that she has never been involved in a planning process before, because in any planning process they will start with making assumptions. They will then use those assumptions to develop policy options. In this case, it's the modelling that is required.
I will take the member back to the front page of this particular document, where it is titled "Discussion Paper." That's exactly what this document is, so as we go out for discussions around this document…. The reason they set out assumptions in the start of a planning document is because they themselves are part of the discussion. It is not a case of sort of saying, "This is our model," and then: "You know, don't worry about our assumptions because we're not going to tell you about them." We actually set out the assumptions right in the start of a good planning document, because as we go around the province and meet with the health authorities and other people that have expertise in this area, they're quite free to look at the assumptions that were made and to challenge them, to question them and to change them — to elaborate on them.
To say that we're somehow locked into some assumptions that are part of a planning document would simply be irresponsible and not part of a legitimate planning process. If you look at what's happening in other parts of Canada, Manitoba, for example, just recently developed some projections around their needs in the future. What they've done is simply taken their historical trends over the last number of decades and just extrapolated those numbers forward. What we're saying is that we want to look at other options and other assumptions that we should be bringing in so that we can develop some new models that really meet the needs of individuals as we go forward.
I will set out for the member what our assumptions are as we go into this. First, we believe that seniors want more choice. Second, we believe that we have to get the best value for the taxpayers' dollars for those options that are subsidized by the taxpayers. Third, we want the best level of care for the respective needs of individual seniors. Fourth, we want to maximize the independence and autonomy of individual seniors so that they can live as independently as they are capable of at that stage in their life. The final assumption we have is that we want to build in flexibility, so it takes
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into consideration the geography of this province and the diversity of the population in this province but is also flexible so that we don't get locked into some rigid model that isn't going to meet our needs five, ten or 20 years from now. Those are the assumptions that underscore all our planning initiatives.
J. Kwan: You know, I don't need a lecture from this minister to tell me what planning documents are and how one moves forward with planning documents to arrive at a target. I know exactly how one does it.
What troubles me in this instance is this. Here we have a planning document that the minister has actually gotten from his ministry, which presumably he asked his ministry to conduct. It is about a year old. Within, it lays out options. It lays out some basic assumptions in terms of trying to set out how to arrive at certain targets by a certain date. Those are fairly basic facts.
I fully understand that when we're doing planning work, some things may change. I also would anticipate that someone who is prudent with their job and their responsibilities would actually set something down so that they can work towards some level of projections but build in flexibilities with the understanding that those projections may change. I do not expect someone who is prudent to say: "We do not have assumptions, and those assumptions keep changing, and we have no targets and no time lines." That's exactly what the Minister of Health is now saying.
If that's the case, then I am greatly worried — with what the minister says and the confidence with which he says it — that he will arrive at delivering the promise politically but as well, and more importantly, delivering the needs required by the community. If he has no plan and no projections right here and now, by 2004, I don't know how he will meet his target goal of providing for the needs of seniors in a year's time or in two years' time or at any time thereafter. It makes no sense.
J. Kwan: The former Minister of Education is heckling me. The current Minister of Children and Family Development should have the gall to heckle me when she might want to look internally to her own ministry and see the chaos that is happening there. So much for the lack of planning. Maybe that is the case in point — that there was no planning, and the money has gone missing from that ministry.
The Chair: Members, order.
J. Kwan: Communities are now stuck in a situation where they are at risk.
The Chair: Order. Members, please keep it on the topic of the budget items before us.
The member for Vancouver–Mount Pleasant has the floor. Continue, please.
J. Kwan: You know, I would welcome any of the government bench members to rise up and ask questions of the minister.
Hon. C. Clark: When you're done.
J. Kwan: I would welcome that.
Hon. R. Harris: Have a seat when you're done.
J. Kwan: Well, okay. They say: when I'm done. Well, sit tight, because it will be some time. It will be some time.
Point of Order
J. Kwan: The member for Vancouver-Burrard, Mr. Chair, on a point of order, is heckling me out of turn. He is actually not in his own seat.
The Chair: Could the member please return to his seat if he wishes to heckle.
Members, could we please continue with the questioning of the minister.
J. Kwan: It might be wise for the members in this House to learn the rules of the House. It has only been three years that they've been elected. They might actually start to learn the rules of this House.
Let me get back to the issue at hand here. The list of things that the minister identified — the notion around flexibility, meeting the needs of seniors, providing for options, etc. He says those are the assumptions that he is working with — in part. In part. According to this planning document…. And I'm not saying this is the end-all and be-all and that this is the only planning document.
I'm glad the minister says that there is more work to be done and that it needs to be updated. So I asked a very simple question of the minister: what updating work is being done? What are some of the numbers he is working with, so he can advise this House of his targets in terms of trying to meet those targets, which then fulfils the commitment that he has said in this House? That is the political commitment of providing for 5,000 new residential intermediate care beds for seniors and the commitment of his job as the minister responsible to ensure that the needs of the communities and the seniors are actually met and on that basis to judge — not for the minister's own assessment or his own colleagues to say how well he is doing. We know that his own colleagues, at least, are incapable of actually doing any form of evaluation that is fair and accu-
[ Page 9008 ]
rate. All that they're able to do is say what the government and the Premier's office tell them they should say, irrespective of what the reality is.
This minister, Mr. Chair, I know to be a responsible individual and very prudent in taking on tasks. He's intelligent; he's forward-thinking. I know all of that. I see it in terms of his performance. I will acknowledge the minister's good work. But if the minister sits in his chair and says, "I don't have any time lines. I don't have any targets. I'm just sort of, you know, out there being very slippery on the slopes and not able to get any grounding with respect to any sort of targets," well, then it brings into question this minister's prudence and his ability, quite frankly, to do his job. It brings into question, in my view, the level of confidence of British Columbians trying to assess whether or not this minister says he will meet his goal — a political goal as well as the goal of meeting the community's need. It brings into question that credibility.
So let me start again. Let me start again with respect to the notion of facts and assumptions. Surely, if the minister says this report's facts and assumptions are not valid and they're changing on a daily basis, well then, to date, what information does the minister have to offer? I'm now talking not about vague generalities and principle statements around flexibility and seniors' independence. All of those are end goals that people want to arrive at. I would even go so far as to say that while they may be part of the assumptions, they are really not assumptions. They are really part of the end goal which one would use to measure how successful this government has been in trying to achieve its goal.
Part of that measurement will be based on what kind of time lines the minister might have established to try and arrive at the goals that he has set; what kinds of numbers in terms of projections of seniors that would require the different levels of housing needs. What are those projections for '06-07 and beyond? How many units are actually out there in the community to meet that projected need for '06-07 and beyond?
Maybe the minister can start, then, by answering these questions and let me know what facts he's using and give me the assurance, Mr. Chair, that the government is actually just not on a ski slope being very slippery, sliding everywhere and being completely out of control. Maybe it is the case that the government is completely out of control. I'm hoping not, because this is a serious matter for seniors.
Hon. C. Hansen: The target we have set is that by the end of 2006, there will be a net increase of 5,000 beds. We spent a lot of time yesterday afternoon as I went through CMHC numbers and talked about what the health sector itself was doing towards achieving that 5,000 goal. We talked about what B.C. Housing was doing towards achieving that goal. I think the information I put on the table yesterday would give anybody confidence. In fact, we're well on the way to achieving that goal of 5,000 beds. But as I said yesterday, I cannot today break down that 5,000-bed number and say it is going to be X number of these kind of beds and X number of these kind of beds, because that is work we're still doing. We're trying to be flexible to make sure that we're sensitive to the individual needs of communities.
The document she has got before her — this planning document, this discussion paper — is not about how we simply get to the end of 2006. This is a planning document that will develop a model that helps us move forward ten, 15, 20 years in a way that will anticipate the future needs. I can't say how many, for example, complex care beds we're going to need. If we can support a senior with complex needs in an assisted-living environment, then we also have to be able to fund the community support necessary to support that senior in that assisted-living environment because of their complex needs.
It's not simply a case of saying that we have X number of complex care beds that we're going to need in the future to accommodate seniors with complex care needs, because a lot of this becomes about how you allocate the budget resources to those needs in the years ahead. If I have to take the budget of this ministry and put it towards complex care beds, then those are fewer dollars I'm going to have to put into the community care supports that may be necessary to support a senior who has complex needs but prefers to live a little bit independently in, let's say, an assisted-living environment or indeed in the family home.
That is what this document is all about. We're going out and doing the responsible thing of saying that it is not up to me as an individual person to try to pretend I have got all the answers. We've gone out with this discussion document to actually engage the health care providers in the communities and get the best input we can from people who are experts in this field. Once we get their feedback, we will try to finalize the assumptions, and we will try to finalize the model. Out of that we will be able to finalize the numbers we may need at any point in time, but again, we'll still try to be flexible to make sure that we meet the needs of seniors in the future. That's what this is all about.
I appreciate the member's desire to get some hard, fast numbers — that we're going to say that by June of 2006 we're going to have X number of these kinds of beds. I can't give her those kind of numbers, because we're not driving it from that perspective. We're driving it from the need perspective of the individuals and how government can support those individuals to make sure they get the care they need.
J. Kwan: The minister made two commitments. One commitment was that he will meet the New Era document of providing 5,000 new long-term and intermediate care beds by 2006. He says that was a political commitment. Then he made a second commitment as the Minister of Health Services, and that is that he will ensure the needs of the communities are actually met — to ensure that for seniors who require the range of
[ Page 9009 ]
housing options, those requirements are actually there for them. That's what he committed to yesterday.
In that process, in canvassing about how we're doing towards those goals, we established and the minister put on record some numbers towards those 5,000 new intermediate and long-term care beds and how we're doing. I have my own opinion on whether or not the government is arriving at those numbers and whether or not the minister would be able to meet that commitment. But I'll set that aside, because that's a political discussion I didn't want to bring into this House in this set of estimates.
Today what I'm trying to establish…. I just accepted what the minister has said and advised me of yesterday. I accepted his numbers. I didn't challenge his numbers. I accepted what he gave me in terms of the new definitions for extended care, complex care groups, etc. I accepted the minister's word that he'd give me the information by the end of yesterday — the other set of definitions with respect to assisted living. I accepted the minister's word that the information would be forthcoming. I had said we'll come back to that discussion when I receive the information.
I have not yet received the information, and even then I understand. There were a lot of things going on yesterday, and things may not have arrived at my desk as the minister would have liked them to. I don't think the minister was being devious in not providing that information by the end of the day. I accept it. I'm not challenging that, and I've set that aside.
Today what I wanted to do was engage in some discussion — not political talk with the government but rather some basic, factual information — as an opposition member so that British Columbians who might be watching this debate could, based on the information I was hoping to canvass with the minister and to solicit from the minister, judge for themselves whether or not this minister and this government are going to meet his second commitment — that is, to provide for the needs of British Columbians.
Then at the beginning of today's debate I asked the minister: is he working towards '06-07 only, or is he working towards years beyond, in terms of 2011-12 or beyond? The minister advised that in fact it's not just 2011-12; we're going far beyond that. We're going to 2020, even, and that was the prudent thing to do.
I thought, great. Here's a minister who is — at least, so he says — forward-thinking about the needs of the community. If that's the case, then it is reasonable to assume that a legitimate question, which I started off with, was to ask: let's then evaluate and see what the lay of the land is with respect to population base in terms of aging seniors — what does it look like?
I read from the report what the projections were, and the minister rose in this House to advise that those projections were taken from StatsCan. I don't quarrel with Statistics Canada; I accept the numbers. We now have a base of what we think the aging population will look like. That is important in understanding what the aging population would look like, because it will give you a sense of what the demand would be in future years with respect to different types of housing options.
Then the next logical thing to move to, which is what is set out in this report, is to talk about what this government is doing right now, and that is the government's policy with respect to eligibility criteria in their assessment. It's taking full well into consideration the flexibility the minister referenced and taking into consideration that particular person's individual circumstances — whether or not the individual's own home would be available or if it's an option for the person to stay there with additional support, as one example. It's taking full well into consideration the desire of seniors who want to remain as independent as they can for as long as they can. That's what this report also says.
Then on that basis, this report goes on to say that with that in mind, generally speaking, we are expecting the majority — not all, not 100 percent of the clients…. All he says is the majority of them. He gives you the flexibility that there might be some movement within the client groups of who may end up going into intermediate care, level 3 or extended care homes — who may be eligible. It has the wording built into that flexibility, and then it has the wording to build in the flexibility of those who would not be eligible.
I think those are basic assumptions. I was simply seeking confirmation from the minister. I don't know why the minister finds it so hard to confirm, to say: "Yeah, that is our existing policy right now, and that's what we're working with in trying to develop what the model might look like down the road." It's not a trick question. All I'm trying to establish is some basis to work towards so that we know with respect to some projections down the road whether or not the government and the minister are going to meet them. That is all.
Given the minister's complete reluctance to confirm this simple request of giving me assurance that the assumptions I read are around eligibility and the policy the government is working with…. Given that he is reluctant to confirm that, for future planning purposes, maybe the minister can tell me the current policy. Maybe the minister can tell me, because in my appendix I actually don't have the residential access policy. I don't have that information.
Maybe we can start with this. The minister can advise me: what is the current government policy right now in determining eligibility, and what is the residential access policy?
Hon. C. Hansen: There is actually, I understand, a section in the Home and Community Care Policy Manual that sets out the access policy. We don't have it here in the chamber, but I am endeavouring to get it into the chamber as quickly as we can.
J. Kwan: Yes, I would appreciate it if the minister could make available a copy of that residential access
[ Page 9010 ]
policy. Maybe for the time being, for the purposes of this debate, the minister can advise: generally speaking, what does the residential access policy entail?
Hon. C. Hansen: Actually, I dug out one of my little notes here from earlier, because the residential access policy, as we discussed earlier, was based in the past on the assessment tools that were in place. It used to be the IC 1, IC 2, IC 3 assessment tools criteria that were there before. We are moving towards a new assessment tool. Based on the care needs that flow from the assessment, we then work with the individual — and the family, if necessary — to determine what residential care would be preferable for that particular individual. That, in essence, to give a summary, is what our residential access policy is. I will endeavour to get more detail on that for the member.
J. Kwan: Is it the case that those individuals who were assessed at what was termed as IC 1 and 2 — intermediate care level 1 and 2 — would not be eligible for extended care beds?
Hon. C. Hansen: If you look back over the last…. This actually goes back to 1990. In 1990 there was about 40 percent of the residential care days in the province where individuals were assessed at IC 2, IC 1 or personal care levels. Over that period of time since 1990, we have seen a steady decline in the number of IC 2, IC 1 and certainly the personal care categories that are put into residential care.
What we know from science, from evidence and studies, is that if you put someone into a dependent level of care — into a complex care environment — before they're ready for that, in fact they will deteriorate. Their health would deteriorate. The short answer to the member's question is that she is correct. We would not place an individual assessed at IC 1 or IC 2 under that old assessment tool into a complex care environment, because that would not be appropriate for their needs.
J. Kwan: I appreciate the minister's answer. He actually did answer my question, the last part of it — that is, to say yes.
I just want to be clear. I'm not passing judgment, necessarily, on this policy. I haven't arrived at that stage yet. I haven't determined whether or not I'm going to, with this debate. It depends on how the debate goes. I'm simply asking these questions to determine, once again, what premises the government is operating under. That's all. The minister need not be so defensive about this, because it's not a judgment. I'm not passing judgment on whether or not this is a valid policy or otherwise. I may do that, and I'll reserve that for another day.
Right now I'm just trying to set out some parameters — in terms of where things are at and what the current government policy is — and therefore be able to assess, based on the information I gather from this debate and other documentation, and arrive at my own judgment of whether or not the government is going to meet the commitment it has set out. So I appreciate the answer.
IC 1 and IC 2 individuals would not be eligible for extended care beds — which is basically, by the way, what the report says. That's exactly what the report says.
Can the minister then also confirm that the criteria for assessment that we just talked about…? That is the current government policy?
Hon. C. Hansen: I think what's important to reiterate is that we are moving away from the model she has just described, with the IC 1 and IC 2. We are moving towards the new assessment tool, and we're in the middle of that transition now. The old model was one that had been in place for a number of decades. It was the five care levels, which were personal care, IC 1, IC 2, IC 3 and extended care. Those are being phased out as we speak.
What we are moving towards, as I mentioned earlier, is the new interRAI assessment tool, which is integrated with client preference. This is the foundation on which the final care plan is based, and I think that's important.
I'm going to send the member a copy of this so that she can read through it. I won't go through it in all the detail. Just to give her a sense of the interRAI assessment tool, I gather it's now used in 33 countries. It's used in a number of provinces in Canada already. B.C. was actually one of the jurisdictions that piloted this, in North Vancouver, to great success.
In the assessment process…. Let me just read this here:
"A joint ministry and health authority working group has been established to resolve common issues related to the introduction of the new assessment process, such as identifying appropriate client groups to be assessed with the new tools, developing a transition process to move from current client care levels to resource utilization client groupings based on the need, and developing a standardized education and training program to support the implementation phase and into the future."
Now, the seven major classification categories of the RAI tool are special rehabilitation, extensive services, clinically complex, impaired cognition, behavioral problems, reduced physical function…. I am told that there are about 30 to 40 subclassifications of these major categories.
Once the assessment is done based on this new approach, then the decisions are made with regard to the appropriate residential options for the individual. This goes into assisted living, as we've talked about earlier. It talks about who can move into assisted living. It talks about new classifications for residential care assessment.
I will be pleased to provide this to the member. I will make sure that she gets it by the end of the day.
[ Page 9011 ]
J. Kwan: I would assume that's along with the old criteria — the IC 1, IC 2, IC 3 — that the minister committed he would provide yesterday. That's included in it. Great.
Essentially, then, what the minister has put on record with respect to the interRAI assessment tool and taking into consideration the concept that those who are IC 1 and IC 2, which was the former terminology, are really what we're dealing with…. Those in those two levels would not be eligible for extended care. I assume that taking all of that together is right now the current government policy.
Hon. C. Hansen: Sorry. I thought I heard the member say that those assessed under the interRAI would not be eligible for extended care. Extended care is a definition that is going to become part of our historical….
Hon. C. Hansen: Once we have gone through the interRAI assessment, the appropriate services that may be provided to meet the care needs that are identified by the interRAI would include home care nursing, palliative care, community rehabilitation, adult day centre, assisted living, home support, residential hospice care. Flowing from the assessment really leads us into the whole range of care options based on the individual needs of the person involved.
J. Kwan: The range of care options was the list that the minister read out. Is that the current list which the government is working with?
Hon. C. Hansen: That is the new assessment system that we are moving towards.
J. Kwan: One would assume that given that you're in this transition period, those who fall under the former groups called IC 1, IC 2, IC 3, etc., will then be attached with new terminologies in the new assessment categories that the government is using.
Can the minister advise me, then: what is the new terminology for IC 1? What is the new terminology for IC 2, IC 3, generally speaking? I'm not trying to trick the minister. All I'm trying to do here is understand the new terminology the government is working with so that I can actually use it in this debate accordingly. I understand that it's not necessarily an exact equivalent in every case and that there is a need to build in some flexibility in that evaluation. But generally speaking, what are we looking at? Yesterday the minister had advised that complex care groups A, B, C, D and E, generally speaking, equate with what was formerly termed extended care. That's all I'm trying to figure out — what the new terminologies are.
Hon. C. Hansen: I would very much have liked to have given the member a simple answer, but there is not a simple answer to what I'm sure she thought was a fairly straightforward question. Under the new interRAI system that we are moving towards, it's a rating system. It actually comes up with about 44 different classifications of the needs of an individual under this interRAI that we are moving towards, which — as I've mentioned — is becoming internationally accepted.
Given that rating system with its 44 different classifications, it's not a case of saying that what used to be IC 3 is now the rating system such-and-such. It's difficult to make that comparison in that regard. If an individual under the rating system is in fact classified as complex care, then once they have been designated as such, we start looking at the five groupings that we talked about yesterday, which I read out the definitions on. What we have here now, under this new system, is one that really comes up with 44 different classification groupings to identify the kinds of needs of an individual.
The other note that I was just handed is that the ministry, along with the health authorities, are currently working to try to map the care levels on this new interRAI classification. It is work in progress. It is being used in some parts of the province. The old system is going to be phased out, but the new system is being brought in. I guess the short answer to her question is that it is almost impossible to try to compare the old classification to a particular new grouping under this new rating system.
J. Kwan: Could the minister advise: when did the ministry decide to adopt the interRAI assessment tool?
Hon. C. Hansen: The pilot project that was done in North Vancouver was actually started prior to the election by the previous government.
J. Kwan: When did this government, after the election, accept the interRAI tool as the basis to do the evaluation to assess seniors in selecting the appropriate housing option for them?
Hon. C. Hansen: I am told it was about two years ago. We started working with the health authorities. The pilot was deemed to be a success, and we started moving forward with implementing it around the province. We're still in that transition process now.
J. Kwan: Given that it is the case that the government accepted the interRAI assessment tool approximately two years ago and that this draft report was developed in January of 2003, it still uses old terminology in terms of IC 1, IC 2, IC 3, extended care, etc. It does make a reference that states: "This policy is further strengthened by the concurrent implementation of a comprehensive, standardized interRAI assessment tool which supports the decision-making of case managers regarding appropriate care settings." It does take into consideration that the government has adopted this assessment tool as its current policy in assessing where
[ Page 9012 ]
seniors should go for their appropriate form of housing.
Given that's the case, maybe the minister can explain to me: two years ago, when the government accepted the interRAI assessment tool, why was this report done in such a way that it does not fully recognize this piloted assessment tool that the government has adopted as the practice and policy for its decision-making?
Hon. C. Hansen: I know the member read out a quote from that document she had. Maybe this is the same quote, so I apologize if I'm repeating it. On page 9, where it refers to the interRAI assessment tool, it says: "With the introduction of the access policy and the provincial mandating of the comprehensive standardized interRAI assessment tool, B.C. is in a better position than ever to project the future need for residential care beds."
At the time this report was developed, we were still at the early stages of implementing this interRAI across the province, and this report calls on historical data, which really was built on some of the old classifications we have talked about — the IC 1–IC 3 classifications.
The other thing is that the implementation of the interRAI assessment tool is an expensive process. It is one that requires some complex information systems to be put in place. It requires considerable training for community care staff in the province — community care nurses and others.
That's the reason why it wasn't simply a case of saying: "Let's start the RAI process as of a certain date where everybody's in it." It is going to take several years of transitioning before we are able to be fully into that new interRAI world, but we are well along that track now. This report the member has before her relies, as she knows, on historical data put together using the definitions of the old model.
J. Kwan: Then because this report was done when the transition is still in place between the two assessment tools, that is to say the old terminologies being used — the IC 1, IC 2, IC 3, etc. — are still valid because they are still being used right now as we're in transition. One would also assume that some of the conclusions, or at least some of the recommendations, and the facts found within this report are also valid. One can only assume that, because the minister says when this report was written, it wasn't just based on old information or old assessment tools. It had taken into consideration, in the transition process, the new assessment tool, and all of that was being considered. Still, in this report it arrives at some, I think, critical numbers in terms of the summaries of findings in terms of where they're at with some of this information.
I'll just put this on the record here now. In this report, aside from setting out the population base in terms of the aging population and what that might look like in different years with the benchmark of 2006 and '07, then 2011 and then 2016 and '17 and then looking at the government's assessment tools that they have in place…. Taking into consideration the old assessment tools that were used as well as the new assessment tool, the interRAI assessment tool, and with the full concept of wanting to find appropriate housing for seniors to maximize their independence and provide the full set of options to seniors — taking all of that into consideration — the report actually also provides this background information. That is to say, the rates for the IC 2, IC 3 and extended care clients have each increased, although not nearly sufficient to offset the rate of decrease for PCs and IC 1 clients, as shown on the diagram it references.
In fact, all throughout the report it makes reference to that effect. It talks about the rate of change and what they anticipate the rate of change might be, utilizing, yes, old terminology — IC 1, IC 2 and IC 3 and extended care — but at the same time with the full knowledge and information of the government's new assessment tool and the projected goal of maximizing independence for seniors with the appropriate housing option.
The report goes on to say that in terms of the different trends with the rate of change — and I'll put this on the record because I don't want to provide the wrong information:
"Consistent with a reduction in the number of home support clients, B.C.'s home support client 75-plus hours per 1,000 population 75-plus has also been slowly declining year after year although at a lesser rate. Rates between 1994-95 and 2001-02 decreased by 22 percent from 24,916 to 19,330 hours per 1,000 population 75-plus. Thus, the average hours of home support for those receiving services increased. While the home support client 75-plus hours for 1,000 population 75-plus rates have declined for all care levels, the most significant decline is for PC and IC 1-level client hours, as shown on the diagram."
Then it goes on to reference the trends in B.C.'s residential care utilization rate over time. It does state:
"B.C.'s residential care bed utilization rates have been slowly declining year after year. Rates between 1994-95 and 2001-02 decreased by 20 percent from 127.9- to 100.2 per 1,000 population 75-plus. This reduction was primarily due to a reduction in utilization by PC and IC 1 clients, particularly between 1994-95 and '97-98. Rates for IC 2, IC 3 and EC clients have also decreased but at a much slower rate. Although still declining, rates have shown increasing stability over the past four years, as shown on the diagram."
Then it goes on to talk about, basically, the rates of change, but at the end of it, it always arrives at the place where it says that while the rates for IC 2, IC 3s and EC clients have remained relatively stable, it does talk about PCs and IC 1 clients having decreased. The point that I'm trying to establish here is this. According to this report, yes, the PC and IC 1 levels tend to have declined, and historical data supports that. However, for the IC 2, IC 3 and EC clients, their rates, in terms of the rate of client, tend to have remained relatively stable.
[ Page 9013 ]
Those are the facts that I wanted to actually lay out with the minister. I see that the minister actually has the report before him, and I know that he was looking at it yesterday as well. The pages that reference this are pages 5, 6 and 7. It is headlined under sub(ii), "Background." All throughout the "Background" headline it talks about the rates of change, basically arriving at, yes, some levels have changed and some levels have basically remained stable. Particularly, IC 2, IC 3 and EC clients have remained relatively stable.
I just want to verify whether or not the government — the minister — agrees with this historical fact that has been outlined in this document.
The Chair: Let's take a five-minute recess, members.
The committee recessed from 4:27 p.m. to 4:30 p.m.
[K. Stewart in the chair.]
On vote 25 (continued).
Hon. C. Hansen: This actually goes back to a policy directive that came out in 1994. I'll just read the description of the policy directive, because it is still the policy today: "Since 1994 the Ministry of Health directive addressed changing demographics and heavier community care workloads by restricting low–care need clients' access to home support and limiting stand-alone housekeeping to exceptional cases. Health authorities have modified and adapted their practices to comply with this requirement and allocated home support to those who need it most."
When you start looking at the services that are available for the high-need clients, they have been maintained, but in fact it has been phased out for those with a lower level of care needs in accordance with that 1994 policy. It says here: "The average number of hours per client has increased from 166 per client in '97-98 to 195 hours per client in '02-03. This is an increase of 17.5 percent and is an indicator of the increased level of complexity of clients in 2002-03 as compared to the mid-1990s."
J. Kwan: I was asking the minister whether or not he agreed with the historical changes in terms of what was stated in this report, and that is the decline in IC 1s and PCs. The rates for IC 2s, IC 3s and ECs, while they have decreased, decreased at a much slower rate and in fact have shown that they have remained relatively stable over time. I was only just getting confirmation with respect to that fact.
Hon. C. Hansen: On the bottom of page 5 in the report, for example, the chart there is historical data. It starts in the '93-94 year and takes us up to the 2000-01 fiscal year. My understanding is that is factual data.
J. Kwan: Great. That's all I wanted to know, so that we know the facts before us are the facts we're working with and that I'm not using wrong information. I would assume from the minister's answer that his ministry is accepting these facts.
Now, let me turn to another area. In this report, what it does at a later section is to translate those percentages, those numbers and those assumptions into actual numbers. Let me put it on the record. It's on page 12, the HCC client and service projections, which reads:
"While the total number of clients served in each scenario is projected to increase from 35,400 in '00-01 to 41,000 by '06-07 — 5,600 clients or 16 percent — the location of clients is dependent upon the scenario. In the status quo scenario" — and that is no change — "all 41,000 clients would be expected to be located and cared for in a residential care setting. This compares to 32,400, 30,600 or 28,600 clients in each of the scenarios 1, 2 and 3 respectively. The difference between 41,000 and the number of clients projected to be cared for in the residential care setting represents those expected to be diverted from residential care to assisted living or independent living with enhanced home support services — 9,200 and 22 percent of clients, 11,000 and 26 percent of clients, and 13,100 and 31 percent of clients in each of case scenarios 1, 2 and 3 respectively."
I just want to ask the minister the question, and again it's to understand the basis on which we're working, if these numbers are valid in the minister's opinion.
Hon. C. Hansen: I think, as I mentioned earlier, the data used in here — the demographic data and demographic projections — is from B.C. Stats, and B.C. Stats does update those annually. This was based on the data that was available to us from B.C. Stats as of the time this was written. As we come back to the whole issue of the assumptions that we talked about earlier, the assumptions are just that. They're not something locked in stone. I guess if someone was to go back and successfully challenge the assumptions, then that would also produce different numbers. These are based on B.C. Stats data.
J. Kwan: Fair enough, because this is when it was gathered — in 2003. I expect that in 2004, if those numbers changed, they probably would not have changed that substantively. There might be some variation, and I accept that. I'm not sort of trying to nail down to the last one in terms of how many seniors fit into what category. I'm just looking at ballpark numbers. These numbers I accept, and I'm glad to hear the minister accepts them as well.
Turning to another section of the report, it talks about the projections of need for assisted living in residential care bed units, which is page 15 — the projections for 2006 and 2007. It reads:
"While the total number of beds and units required in each scenario is projected to increase, the size of the increase and the location of clients is dependent on the scenario. In the status-quo scenario, the number of beds required is projected to increase by 4,500, all of which would be residential care. In other scenarios the number
[ Page 9014 ]
of beds and units is projected to increase by somewhere between 1,300 and 4,200, which would be apportioned approximately 75 percent to 78 percent residential care and 22 percent to 25 percent assisted living.
"The combined residential care and assisted-living unit utilization rates under each of these scenarios range between 90 and 100 beds per 1,000, 75-plus, which compares to the '01-02 utilization rate of 100.2."
It goes on to say that projections for 2011-12, in the status-quo scenario:
"…the number of required beds is projected to increase by 9,100 over 2000-01 beds, all of which would be residential care. In other-case scenarios, the number of beds is projected to increase by somewhere between 5,300 and 8,900, which would be apportioned approximately 72 percent to 76 percent residential care and 24 percent to 28 percent assisted living. The combined residential care and assisted-living beds utilization rates under each of these scenarios range between 95 and 106 beds per 1,000, 75-plus, which compares to '01-02 utilization rate of 100.2."
Then it talks about the projects for 2016 and 2017. The paragraph essentially reads the same, but the numbers change for the status-quo scenario for a projected increase of 13,600. Then in the other-case scenarios the increase is ranging from 9,400 to 13,400. I won't read the rest, because essentially it's the same.
[J. Weisbeck in the chair.]
Finally, it arrives at this paragraph, where it reads:
"Interesting to note is that after three to five years, the reduction in the utilization rate achieved as a result of implementing the access policy becomes at least partially if not totally offset by the increase in the proportion of the 75-plus population in the very old age group — i.e., 85-plus. Those in the very old age group have higher utilization rates than those between 75 and 85 years old."
On this basis and based on historical projections, I'm asking the minister, Mr. Chair, whether or not he accepts these projections as outlined in this report.
Hon. C. Hansen: I think I have to come back to a discussion we had earlier that this is, in fact, a model. There is a set of assumptions set out. There's a model that's developed. This is a theoretical framework for how to anticipate future needs, and it is a discussion paper. We have gone out to get feedback on it, and that's where we're at with this thing. So, no, I'm not going to say that I endorse all of these projections, because I don't have that feedback yet. It would defeat the purpose of going out with a discussion paper if I were to lock myself into a particular projection.
But once we come up with a model that we can have some consensus on among those that are involved in this field, what we still have is a theoretical number, a theoretical model. We then have to translate that from the theoretical to the practical.
A lot of that is actually happening now, because we have to take into consideration the fact that we're not starting with a blank slate on any of this stuff. We have geography that we obviously have to contend with. We have existing facilities — some of which are useful going into the future, others that are not and some that can be renovated. We have to take into consideration the diversity of populations in different communities. At the local level, clearly, the needs and how this particular model may be applied in a community like Dawson Creek would be very different than those in a community in the lower mainland.
This will arrive at a theoretical projection and will be a useful tool for our planning process. But we're not yet at a stage where I'm going to say I will endorse any of the particular numbers that come out of this projection, until such time as we've had a chance to work through the decision-making process.
J. Kwan: The minister keeps on going back to say he's out there soliciting input and that this is just a discussion paper. Is this the discussion paper that's gone out to the health regions and to other health care professionals or whoever the minister is consulting with? Is this the discussion paper that he's anticipating feedback from?
Hon. C. Hansen: This particular document is part of a considerable volume of work that is being done across Canada. In this province we have a home and community care council, for example, which has input from the different health authorities. They meet regularly, so in addition to this document, they certainly have had lots of discussions and reviews of available literature. There are academic partners that are called into that on a regular basis. We also, through that, have input networks from Pricare, the B.C. Hospice–Palliative Care Association and groups like that.
There's been a fair amount of discussion at the FPT level in Canada. There are documents that have been presented at the FPT level, which also become part of the consultation or the consultation documents that are being used. Health Canada, for example, has been developing a lot of guidelines. In the health accord that was signed a year ago last month, there is health accord funding that flows with regard to home and community care. There is a lot of material that's been pulled together by Health Canada as well, which becomes part of the discussions that are taking place in the province to help determine how we move forward on this. This document is one of those documents that is being looked at to help guide us in this policy-making process.
J. Kwan: From what I gather then, there is no one discussion paper that the minister is talking about that he's seeking input on from the various sources. It sounds to me like there's a whole bunch of different documentation the minister is using. Does the minister have copies of all this documentation?
Hon. C. Hansen: Yeah, a lot of this documentation is really in the public realm. When we talk to those in the province that can bring some expertise to the table around this, they bring in their documentation. Some
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of it's available from websites. As I said, some of it is Health Canada documentation that they're sharing with all of the provinces to help guide us as we move forward on this thing. There's a considerable amount of documentation that is being utilized, but it's not necessarily documentation that's been generated by the Ministry of Health Services in this province solely and for the exclusive use of this province. We are really looking at quite a broad range of information that comes to assist us as we develop this policy.
J. Kwan: The minister refers to other provinces, the federal government, etc. Is he talking about developing a planning model for home support, assisted living and residential care in British Columbia in conjunction with other provinces, and therefore there would be a plan that's not just for British Columbia but for other provinces and potentially — from the way it sounds — for the rest of Canada?
Hon. C. Hansen: There is an FPT table that is trying to help coordinate some of the information flow around it, but it's not something that's going to lead to one national home and community care program. It's being chaired by Ontario this year, and it is designed to try to learn from the experience of each of the other jurisdictions that participate in that table. In addition to that, certainly at the deputy minister level, there has been a lot of discussion nationally around home and community care, particularly as those issues flow from the health accord discussions.
This document the member has been referring to over the course of this debate is a document we have shared with other jurisdictions. They, in turn, have shared information with us. It's not something that we're trying to all head towards the same common outcome on, but we are trying to make sure we share information and best practices in a way that we can learn from each other's experience.
J. Kwan: Well, thank you, then. Fair enough. I understand those tables. With different ministries and having been in government before, I've been at those tables as well — whether it be on homelessness or housing or whatever the case may be — so I understand what the minister is saying and what happens at those tables. But those tables, generally speaking, do not become a place where government, for the purpose of this discussion, develops its model for home support, assisted living and residential care. It may be a place where everyone gathers together to exchange information, best practices and so on. You sort of go home with a pile of paper, and then you sift through them, and then you sort of figure out who's doing what and what's working for whom and all that stuff. You might pull a piece from here and there and adopt it into part of your plan.
It doesn't sound to me, though, that part of that consultation the minister references around this table is the consultation process that the health authorities are engaging in. I assume, when the minister advised that the health authorities are engaging in this consultation with the minister, they are working towards developing a plan for British Columbia — a plan of home support, assisted living and residential care. Am I not right in understanding that?
Hon. C. Hansen: It would not be fair to say that this process we've been talking about over these number of hours is going to lead to a home and community care plan, as I think the member's words were. Rather, this is a model that is being developed, which will help us as a planning tool going forward.
In the discussions that we've had, we've been working with those in the health authorities that are most familiar with the whole issues around home and community care. We're working with the academic sector, with those that can bring expertise to the table around this. So, yes, there is a lot of consultation going on to basically pull in the views of those who can bring some experience and expertise in this particular area.
J. Kwan: Maybe I'm just getting tired — I don't know — but trying to get a straight answer from the minister feels as though I'm trying to nail Jell-O to the wall. There's no trick here, Mr. Chair — honestly. I'm not trying to trick the minister in any way, shape or form. I'm just trying to figure out the lay of the land — what's going on.
The minister says that he has this planning document, which we engaged in some level of discussion about. Particularly, I was trying to assess certain facts and assumptions and projections and whether or not that's the information and the targets that the minister is trying to meet. The minister says no, that's an old report. "It's only a discussion paper, and so I'm not committing to anything in this report because I'm not the expert." I'm paraphrasing, Mr. Chair.
He advised that he's out there consulting experts in the field — those in the health authorities, in the academic community, etc. Then he said there's a discussion paper out there to which he's soliciting input. I asked the question…. One only assumes, given the discussion that's been going on, that perhaps this discussion paper we have been engaging in discussions on is the discussion paper. The minister says no, that in fact there is a table that involves deputy ministers and other provinces and representatives, at which everybody sort of comes together and engages in discussion about best practices and who's doing what, etc. I accept that, and I accept that that goes on with ministries. Then he says there are also, in that process, other people bringing forward documentations which we share with one another and that there is no national plan of home support, assisted living and residential care at all.
Then I asked the question: for British Columbia, in terms of the planning model that the government is going to be utilizing to arrive at its projected goals — the two goals that we talked about…? That is the political commitment in the New Era document of meet-
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ing 5,000 new intermediate and long-term care beds and the other commitment of this minister's responsibility, and that is to provide for home support, assisted living and residential care services to seniors in our communities that meet their needs.
In that vein, I fail to understand, so far, the consultation process that the minister is engaging in. I fail to understand what documentations are used in this consultation process. I fail to understand, if at all, the end goal with this consultation, with this discussion paper that doesn't exist — that this minister would have a document before him on which he can then make some decisions about what the time lines are, what the targets are, and to even project what the needs are….
Maybe the minister can enlighten me by telling this House exactly what is going on with this consultation process. Maybe he can start by advising me who is at the table for the consultation, what the purpose is, what the end goal of the consultation is and, with that consultation, what he hopes to achieve out of it. Is he looking at time lines? Is he looking at projections? Is he looking at what the needs are in terms of the number of the units and the breakdown of the types of units that might be required for 2006 and 2007 and the years beyond, all the way to the year 2020? As the minister said earlier, that's what he's working on right now.
Hon. C. Hansen: The member was referring to some planning document that I had been referring to. The discussion paper, which is what she referred to, is the one that she brought up, and that's the one she's been quoting from. If she'll flip to the front cover of it…. It is titled "Discussion Paper Draft, January 13, 2003." This is not about developing a home and community care plan for the province. It's about developing a model. It's quite specific in terms of what it's trying to accomplish, and we've talked about the assumptions and everything else that goes into this.
On the other hand, if we want to talk about…. Let me just finish that. This particular document has been actively discussed by the home and community care council, which is made up of representatives from the health authorities, including some of the individual health service delivery areas in the province. That, as we discussed, is an ongoing process that will hopefully help them to finalize this particular model, which will assist in some of the other decisions that we have. Now, that's one subject.
The other subject that we've been talking about is the more general approach to home and community care where, as I mentioned, there's all kinds of literature being utilized. There's Health Canada literature. We're working with all kinds of different players in this on the discussions around the home and community care system for the province. We include in that network B.C. Housing, B.C. Pricare — I always forget the new name for that organization — and B.C. Hospice–Palliative Care Association. We have discussions with the investment community around: how do we provide financing for some of these new residential care facilities and assisted-living facilities in the province so that they can be financed in a way that makes sense?
There are lots of players that come together in assisting us as government with the home and community care issues generally. But if you're talking about the discussion paper that we have been talking about during this discussion, it is this paper that she has on her desk, which is around — as it says right on the front cover — A Planning Model: Home Support, Assisted Living and Residential Care Services, which is looking at a tool, really, for how we can help forecast the kind of resources we're going to need into the future.
J. Kwan: Well, thank you to the minister for that clarification, because I asked the minister about consultation and whether or not this was the document he's using for the purposes of that consultation. Now, I must admit I didn't clarify that consultation. Was it for a model, or was it for a plan? I just assumed that, given that we were having this discussion, we were talking about the planning model and that ultimately it would arrive at giving the minister the assumptions he needs and the projections he needs so that he could actually come forward with a plan. The adoption of the model will presumably lead to a plan of action for the government. I just assumed that. I'm sorry if I didn't say the right word, whether it's a plan or a model.
The minister had actually said that they weren't using this document. Then at that point he injected that there was this interprovincial table which everybody is at, exchanging information. That discussion led me to think that that was the consultation process with respect to the model. I appreciate the clarification from the minister.
What he has now just advised — that in fact there's a thing called the home community council, which is reviewing this document for the purposes of the planning model for home support, assisted living and residential care services…. They're providing input to the minister with respect to this document, this draft document. The front of the page does say: "Meeting the ongoing care needs of seniors and people with disabilities. A Planning Model: Home Support, Assisted Living and Residential Care Services. Discussion paper draft, January 13, 2003."
Now that we've got that base settled…. This is the document the minister is consulting the home community council with. When does the minister anticipate this consultation process will end?
Hon. C. Hansen: I know this question, or a variation on it, came up earlier. The best answer I could give at the time was that we hope to get this model as soon as possible. As I understand it, there has been feedback that has been developed through the discussions that have taken place around this discussion paper. I think once we have a chance to incorporate some of that feedback, we'll fine-tune it. It's also probably a model that should always be somewhat flexible. To say that
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we're suddenly going to lock ourselves into a model in perpetuity would be misleading. In fact, it'll probably continually be refined as we go through policy changes that need to be reflected in this model. Hopefully, it will be the first time, I think, that any jurisdiction that we're aware of has actually developed such a model. We have every expectation that once we get it developed, we'll have other jurisdictions copying it.
J. Kwan: Great. Great. I love it when government shares information with other jurisdictions. That's a great way of developing partnerships as well as learning from one another. I don't quarrel with the minister's goal with that. Great, as well, for the minister to advise this House that this is going to be an ongoing, evolving process. Obviously as time evolves, as things change and circumstances change and technologies change and so on and so forth, one would want to review and see what needs to be updated. It's excellent that there's commitment for ongoing work.
At some point in time, one would assume — and I would assume, at this current time — that the minister has some general ballpark time line for this consultation process, at least for the first phase of it, to come to an end so that the minister can gather all of the input he's received and have staff tabulate it and do some analysis on it, and then formulate another report to which he can turn his mind and then decide on what he wants to do with it. He can decide to shelve it and say, "That's full of junk," or he can say, "I actually quite like this and that and whatever," and take pieces from it and then go to the cabinet table and ask for a cabinet decision in terms of how to move forward on some of this stuff. Or he can decide not to go to the cabinet table and to say: "To heck with it. I just want to do this, and I'm just going to go ahead and do it." At some point in time within this minister's mandate, one would assume that the minister would arrive at that place.
Generally speaking, it's not credible for the minister to say, "I have no time line. I have no idea when I might do some of that work" in terms of what the time line might be. It's not credible for the minister to say that. So I would ask the minister to give me some ballpark time line for when he expects that the first round of tabulation of the input he's receiving from this discussion paper will be put together to generate a report for the minister's consideration.
Hon. C. Hansen: As I said in response to an earlier question, this is not on a specific time line, but we are trying to move through it as quickly as possible. I can't tell her when this is going to ultimately go to cabinet, and even if I knew, she knows it wouldn't be appropriate for me to share that with the House. The best answer I can give her is that we expect some of the progress on this particular planning model will be happening very soon.
J. Kwan: When did this discussion paper go out to the home community council?
Hon. C. Hansen: I am advised that this particular discussion paper was distributed fairly widely to officials in the various health authorities about the time this draft was dated, which is January of 2003.
J. Kwan: From which health authority has the minister received input with respect to this discussion paper?
Hon. C. Hansen: I don't sit on the planning committees within the ministry, so I have not received any of it. I have officials that are actually tabulating this information. They will bring the report to me in a completed form when it's ready.
J. Kwan: The minister says he doesn't receive the information but his officials do, and he is responsible for his officials. So, in essence, the minister has received it. Fine. He says: "I haven't received them." His officials that he is responsible for…. From which health authorities have these officials received feedback?
Hon. C. Hansen: There have been countless discussions involving this paper, involving officials from the health authorities, over the last year from when it was first circulated. That information all becomes part of helping to refine this, helping to determine whether assumptions are accurate. It has been an ongoing discussion that involves many individuals in the health authorities that are involved in home and community care.
J. Kwan: Does that mean to say that all of the health authorities and the officials within those health authorities have sent feedback to the ministry with respect to this discussion paper?
Hon. C. Hansen: There have actually been lots of discussions involving all of the health authorities and the ministry. I understand that ministry staff actually went out at one point to the various health authorities to get input from them on the ground — if that's the right way to put it. There have been lots of discussions. All five of the regional health authorities have certainly been involved in those discussions and have had the opportunity to have input on this particular discussion paper.
J. Kwan: Well, that wasn't so hard. So all the health authorities have provided input to the minister with respect to this discussion paper.
Now, the minister first advised that the discussion paper has gone out to a group called the home community council. Later on, I think he expanded that to say it's gone out to all kinds of officials. I just want to clarify that point. Which is it? Is it the home community council in addition to other officials within the health authorities, or is it health authority officials that are part of the home community council?
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Hon. C. Hansen: I do not have a list of every individual who has received a copy of this discussion paper from us, but certainly a copy has been sent to every health authority. The health authorities, in turn, have certainly had the freedom to circulate it to those within the health authorities whom they think may be able to provide some constructive feedback on this. I simply don't have a list of everyone that may have received this particular document.
J. Kwan: Fair enough, and I wasn't going to ask the minister for that list either. All I was going to ask and try to get clarification on was at least who the minister knows that, from his ministry, has been purposely given this report for the purposes of feedback. I fully understand that within any organization, the person who is the head of a particular department might have received this and would have distributed it to their staff and asked for their expertise and input. I fully understand that kind of process, and that's not what I'm trying to get at.
The minister named a group called the home community council to which this document has been given, and they're using this discussion paper to provide input to the minister so that the minister could arrive, at some point, at finalizing this model. Am I understanding correctly? When the minister said it's the home community council, is that who received this document which the minister is expecting and has received input and response from this particular group regarding this discussion paper?
Hon. C. Hansen: The council is actually properly referred to as the home and community care planning council. It is made up of a representative from each of the health authorities, who meet with officials of the ministry. Certainly, the home and community care planning council has had discussions around at least elements of this particular document, and input has been provided by them.
J. Kwan: The home and community care planning council from which the minister is asking for input regarding this discussion paper and that has representation from each of the health authorities…. Could the minister advise: who is on the home and community care planning council?
Hon. C. Hansen: I am told it's the VP- or the director-level official in the health authorities who has responsibility for home and community care.
J. Kwan: Is there anybody else on this home and community care planning council, outside of health authorities?
Hon. C. Hansen: I am told that the CEO of B.C. Housing is also part of this council, and there are several Ministry of Health Services officials that also serve on this particular council.
J. Kwan: Is there anybody from the non-government agencies, whether it be the ministry or the health authorities, that sit on this council?
Hon. C. Hansen: No.
J. Kwan: Is the minister making any efforts to solicit feedback with respect to this discussion paper and therefore the planning model for home support, assisted living and residential care services? Is there anybody the minister is consulting with that's outside of government?
I just want to clarify that. I don't mean the bigger table that the minister talked about earlier — in terms of generally offering information and best practices, etc. — and that the deputy minister, amongst others, sits at. I mean community folks, as an example, who might or might not be consulted with respect to their thoughts and opinions around the discussion paper. Is there anybody from outside the government?
Hon. C. Hansen: The member was asking about this other table that is there. There's no other table per se. It is a whole process of consultation that goes back many years. In fact, the consultation around the kind of home and community care model we need to be working towards is something that goes back to the dialogue on health care that we had when we were in opposition, before the election even, and went into 27 different communities around the province. I mentioned earlier some of the organizations we rely on for input as we develop policy in this particular field. The former minister of state did extensive consultations over two years. She met with virtually every group imaginable in the province that had an interest in home and community care over that period of time. In fact, a lot of that feedback she got was presented at open cabinet, which of course is on the website and is part of the Hansard of open cabinet.
When it came to the new act, the Community Care and Assisted Living Act, there was an extensive consultation process around the province that got all kinds of feedback from all kinds of different organizations. The new registrar of assisted living that's been put in place has been engaged in all kinds of consultations with numerous different organizations. There's the end-of-life strategy that the previous minister of state had unveiled. That is on our website and is soliciting public feedback as well.
When you look at the kind of feedback and discussion we have generally around where we're going with home and community care, it is extensive. It will be an ongoing process, and we will make sure we get feedback from all of those different stakeholder organizations as well as individual seniors who are affected by this. On one hand, we've got our discussion paper — to come back to that — which is around a planning model which has been discussed by those in the field that have expertise in that area. Where this model fits into the broader planning process really involves discus-
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sions with literally hundreds of different groups and organizations and interests that we rely on for input.
J. Kwan: My, my, my. I must say, we are defensive. We are defensive. The minister just sort of went on about the consultation about home support services generally, etc., and that wasn't even my question. I wasn't talking about consultation with home support services, assisted living or residential care services generally. I was speaking very specifically about this discussion paper and trying to find out from the minister who else, if anybody, outside of government officials is being asked specifically for feedback regarding this discussion paper. That is all. I just don't know how else to put it. Just the level of defensiveness is really beyond me. Maybe it's sensitive times, given the current situation I know this government is faced with. Maybe it's sensitive for the minister.
Am I right in assuming, given the minister's answers so far, that outside of government agencies and government officials, the minister has not asked for feedback specifically related to this discussion paper? This is feedback from other groups outside of government agencies and officials.
Hon. C. Hansen: To the best of my knowledge, this document has been shared. It is an internal document within government. I think that as it says right on the front cover, it's been developed by the home and community care division and the information support staff of the ministry as an internal document, an internal discussion paper between the ministry and government generally but including the health authorities. It was meant to be a document that would be focused on by those individuals.
Now, health authorities may have shared it with others outside of the health authority — I'm not aware of that — but it was certainly never meant to be a document for general distribution. It's an internal document that's trying to develop a new planning model.
J. Kwan: In no way was I suggesting that this was a document for general discussion. All that I was asking to see is whether or not the government had solicited response from anybody else outside of government officials.
Having been in government and having set up tables with various committees, and so on, with internal documents to which we solicit input from officials and outside of government agencies, that is a regular happening even with internal documents. All that I was trying to determine from this minister is to see whether or not he's invited anybody else to this table.
Given that he hasn't, I would then raise this point. Given that this process is an ongoing process — as the minister is still trying to receive optimal feedback so that he could receive the information to formulate this planning model for home support, assisted living and residential care services — he would be wise to send this discussion paper, even though it's an internal discussion paper, to some other stakeholders who also have expertise in this area, for their feedback, specifically for the purposes of providing input for the minister's consideration of this planning model. I would urge to the minister to do that.
There are many people outside of government agencies and government officials who have that expertise and may surprise the minister with their feedback and their assistance in this process. They may surprise the minister in terms of providing information with respect to the assumptions and the projections that are contained in this report. The minister at some point in time in his career, within this mandate, would have to come to terms with and adopt and develop a plan and set out targets and time lines in achieving the goals for home support services, assisted living and residential care services for British Columbians.
Let me ask the minister: given this suggestion, would the minister consider requesting input from other stakeholders regarding this discussion paper specifically?
Hon. C. Hansen: As I said earlier, this document was designed as an internal document. The broader consultations that we have on an ongoing basis get input around the elements that go into these assumptions. You know, this document was not developed in a void. It was designed to be an internal document that really utilizes a lot of the input that we get from those various groups. I agree with the member. There are lots of people in British Columbia today, outside of government, that have lots of expertise in this area, and we are tapping into them. It is some of that expertise and input that was instrumental in developing this particular internal document. I'm sure now that three-quarters of the document has been read into Hansard, it's there for everybody to read, and I'd welcome comments.
J. Kwan: Well, given that the minister would not even say that he would consider doing that, then let me just do this. Given that this is the document that the minister has confirmed he has invited the home and community care planning council to provide input to him with respect to trying to come up with suggestions for the planning model for home support, assisted living and residential care services, and given that he wouldn't ask other stakeholders to provide that input, let me just say that the opposition will. Let me say that the opposition will send out this document to other stakeholders and invite their input and will forward it to the minister for his consideration.
It makes no sense whatsoever for the minister to try and hide under this notion of an internal document and therefore say that he won't consult more broadly. For the minister to suggest the former Minister of State for Intermediate, Long Term and Home Care did the homework on consultation, quite frankly, gives me no confidence at all with that work.
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I'll tell you why. Yesterday we spent quite a bit of time discussing information that the former Minister of State for Intermediate, Long Term and Home Care had put on record, which had proven to be wrong — which this minister had to correct on the record on a number of fronts. So given that background, given that knowledge, I have zero confidence, quite frankly, with the work of the former Minister of State for Intermediate, Long Term and Home Care. No personal offence to the former minister of state. I quite like her; she's a lovely person. But the information she put on record in estimates debate and in other situations was wrong information, which this Minister of Health Services had to correct yesterday.
With that background, it gives me no assurance whatsoever with that knowledge that this Minister of Health Services is relying on the work of that former minister of state with respect to consultation.
Let me just conclude here, Mr. Chair, because we did spend quite a bit of time on this report, and there was a purpose in all of this, especially now that we've identified that the minister is using this discussion paper as the basis for input for a planning model in the area of home support, assisted living and residential care services. The minister said he has not yet accepted the projections that have been outlined or the assumptions that I outlined earlier today. Let me just put on the record the findings of the report, therefore taking into consideration the assumptions and projections, and so on and so forth.
The report actually gives a number of scenarios for the different years of what would be needed in terms of the numbers of beds in the province to meet the needs of seniors. The report actually states that with respect to the year 2006-07 under scenario 1, which is the low-shift scenario, in residential care beds it is expecting to have 22,838 beds and in assisted-living units it's expected to need 6,742 for a total of 29,580. Then in the year 2011-12 it expects to need 26,134 residential care beds and 8,192 assisted-living beds for a total of 34,326. For the year 2016-17, residential care bed needs in the low-shift scenario is expected to be in the area of 29,626 and 9,250 assisted-living units for a total of 38,876.
Then for the moderate shift for '06-07, it's 21,507 for residential care beds and 6,807 assisted-living units for a total of 28,314. For 2011-12, it's 24,380 for residential care beds and 8,400 assisted-living units for a total of 32,780. For 2016-17, residential care beds needed will be in the area of 27,622 and 9,517 assisted-living units for a total of 37,139.
For the high-shift scenario, the 2006-07 residential care bed needs would be 19,950 and 6,728 assisted-living units for a total of 26,678. Then for the 2011-12 year, it is expected to need 22,265 in residential care beds and 8,457 assisted living for a total of 30,722. Finally, for the year 2016-17, it's 25,195 residential care beds and 9,616 assisted-living units for a total of 34,811. Those are the projections of what would be needed.
It goes on further to say…. In the final paragraph on the summary of findings, it also puts forward a caution which reads: "It is important to note that after 2006-07, the need for additional beds and units will significantly increase. By 2006-07, the long-term impact of the new access policy will be felt, and accommodation will need to be made for the growing numbers and increasing ages of the population of seniors. These longer-term requirements, especially for additional residential beds, need to be considered in short-term planning." This is a cautionary note.
I wanted to put this on the record because at least the discussion paper that the ministry has come up with highlights the number of beds that they project would be required, which the minister would not confirm. He would not confirm any of the assumptions. But irrespective, I can only guess that the people who did this work that the ministry is responsible for did it diligently with the information they had before them and with the assumptions that they believe are the case in terms of what's going on around the province. Maybe the input that comes back will tell us otherwise, but that gives us, generally speaking, the ballpark figures of what we're looking at.
That brings me to this question. I understand that the minister won't accept it, but I do want to caution the minister on this, and I would like his response on it. In the process — and clearly with this report — it actually projects an increase in terms of the need for the number of beds, with the full range of housing options that would be required. It is disconcerting that the government, in that process, is actually shutting down beds. Yesterday we were able to establish, and the minister had put on record, that 2,369 beds have been shut down across the province.
With that in mind, we'd better…. I hope the minister will confirm that he has accounted for the number of beds shutting down — and so therefore the decrease in the number of beds available for seniors as part of that housing option continuum — and while, yes, he's increasing other areas, that the two combined — the reduction and the increase — will actually be able to meet the needs of the seniors in the community. Now, I'm going above and beyond what the minister had committed in terms of his political commitment to what he committed as his responsibility as the minister, and that is to provide for the needs of the seniors in our community.
So in that accounting of it, one must also… I hope the minister will confirm that he is also accounting for the number of beds that are being shut down and the level of services those beds offer, and that no matter what model he comes up with, at the end of the day he will ensure that the seniors have the housing options they need, when they need it and where they need it.
Hon. C. Hansen: I think that what the member has just outlined from this report underscores the fact that we are on the right track. These may well be the numbers at the end of the day, once we get through the input and we challenge the assumptions. If they turn out to be right, we start looking at the various needs of communities and what the appropriate level of beds
[ Page 9021 ]
would be, based on this planning model — if this planning model, in fact, is what gets confirmed at the end of the day.
But the very numbers that she read out confirm that where we are heading is where we need to get to. For example, in '06-07, it says here that what we need to meet the needs of seniors in the low-shift scenario is 29,580, as she mentioned. In the moderate-shift scenario we would need 28,314. In the high-shift scenario we would need 26,678. As we discussed, the base number that we are working from, when it comes to our commitment for a net increase of 5,000 beds in the province, would take us up to 30,000. So with that commitment, which we are well on track for — as we went through yesterday — we would in fact meet the needs, assuming that this particular planning model is in fact what gets confirmed at the end of the day.
The member talks about the number of facilities that are closed around the province, and I know on Monday she spent some time going through a list of facilities in the province that she says have been closed. I think it's important that I correct the record because of the impression she left with the House regarding these various facilities. I would like to run through the list she ran through.
She mentioned Bethany Home in Vernon as being closed, and that's a surprise to people living in Bethany Home, because it remains open. It is being expanded to increase the number of residential care beds and to have new assisted-living units.
She mentioned Boundary Lodge in Grand Forks as being closed. It was determined it was no longer suitable as a residential care facility, so it is being converted into assisted living.
She mentioned Cariboo Lodge and Heritage House in Williams Lake as being closed, and in fact that facility remains open until the replacement facility has been completed — a brand-new, beautiful facility that's being built in Williams Lake.
Cascades in Burnaby she mentioned. That in fact is being converted for mental health services.
She mentioned Central Park Manor in Burnaby as being closed, and do you know what? She's right. It was closed in February.
She mentioned Cooper Place, which I believe is in her own constituency. Cooper Place, in Vancouver, was converted to 72 assisted-living units — the first facility of this kind in the downtown east side.
She mentioned Deni House in Williams Lake. This is a facility that remains open until a replacement facility is completed.
Fernie District Hospital care facility she mentioned as being closed. In fact, the hospital remains open. There are three residential care beds that were closed.
The Fountainview facility in Salmon Arm she mentioned is closed, and that one she was correct on.
The Gateby in Vernon was closed. That's a surprise to the residents who are living in that facility as we speak.
Golden and District Hospital care facility is being closed. The hospital is open. There were seven residential care beds that were reduced.
Gorge Road Hospital in Victoria. That in fact is being transitioned. We know the issues around Gorge Road Hospital, but it does remain open and is being utilized for residents who are in some transitional situations while new facilities are being built.
She mentioned the Halcyon Home in Nakusp as being closed, and that again is a surprise to people living there. It will be converted to new assisted living.
She mentioned the Haney intermediate care facility in Maple Ridge. That is a facility that is being converted into new assisted-living units in the future.
The Holy Family ECU in Vancouver. That remains open as part of the Providence consolidation project that may, in fact, lead to redevelopment, but it is very much active in serving patients today.
She mentioned the James Bay Lodge in Victoria. That is being closed temporarily to provide for renovations to accommodate complex care patients in the future. Those residents, along with those from Sandringham, are being temporarily relocated.
She mentioned the Joseph Benjamin care facility in Kelowna. That in fact has been closed, but it is being converted into new assisted-living units.
She mentioned Juniper Court in Enderby. That in fact has been closed.
Kelly Care Centre in Summerland remains open today and will not close until a replacement facility has been put in place.
She mentioned Kiro Manor in Trail. That remains open today as we speak.
Kiwanis Lodge in Nanaimo. That is being replaced with 75 complex care beds and 75 alternate-level care units.
The May Bennett Home in Kelowna. That has been closed as a residential facility because it was found to be no longer suitable, but it is being used as a wellness centre in that community.
The Mater Misericordiae in Rossland. That remains open as we speak.
Moberly Manor in Revelstoke. That is being converted into assisted-living facilities.
The Mount St. Francis facility in Nelson. That remains open, and it will only close when a replacement facility has been developed.
The Olive Devaud Residence in Powell River. That remains open.
Parkholm Lodge in Chilliwack. There were 84 beds that were in fact closed — residential care beds that were found to be no longer suitable.
Ponderosa Lodge. That facility will not close until replacement facilities have been built.
Peace River Haven in Pouce Coupe. That still remains open, but it will be converted to assisted living when the time comes.
Penticton and district care unit in Penticton remains open. It's gone through some changes, but the facility certainly remains open.
[ Page 9022 ]
Pioneer Lodge in Salmon Arm remains open and will be converted to assisted living at some point.
Pioneer Villa in Creston remains open and will be converted to assisted living.
Rainbow Intermediate Care Home in Prince George also remains open as we speak today.
Rocky Mountain Lodge in Cranbrook remains open as we speak. The Royal Ascot care centre remains open.
Royal Inland Hospital care facility in Kamloops. The hospital remains open, residential care beds are closed, and funding has been transferred to a new facility that's been opened in Clearwater to meet the needs of those residents.
Shirley Dean Pavilion at Surrey Memorial Hospital. That is the decommissioning of 60 beds. Operational dollars will be used for a new 36-bed Alzheimer's facility, and the rest of the operational dollars will go toward residential care beds.
The Slocan Community Hospital and Health Care Centre in New Denver remains open as we speak.
St. Bartholomew's Hospital in Lytton remains open as we speak.
The Southview Lodge in Vancouver is being converted to assisted living.
Summerland Lodge in Summerland remains open as we speak.
She mentioned the Tom Uphill Home in Fernie. That will not close until replacement facilities have been built.
Willowdale Home in Armstrong remains open as we speak and will be converted to assisted living.
I felt it was important to put this on the record because of the comments the member made on Monday in listing off this list of facilities that were closed. Certainly, I'm sure it was of concern to the family members of those residents who are still today living in those particular facilities.
J. Kwan: It is interesting to note the list that the minister read off, the majority of which he says have been converted. I particularly want to reference one that's in my home riding, and that's Cooper Place. In fact, Cooper Place has closed. It was a long-term intermediate care facility that has closed, and the government changed it into assisted living. That is what the government has done, but the reality does not change when the government switches the facility and its usage into something else. It doesn't mean to say that the intermediate care, long-term care facility did not in fact close.
I was down there on a number of occasions speaking with the people who lived in the long-term and intermediate care facility of Cooper Place and their families. They raised their concerns with me about this change. They raised their concerns with me about knowing the government was going to change it into assisted living and how dissatisfied they were. In fact, some of the family members were moved to somewhere else outside the community where they've lived in for a long, long time. They were particularly concerned about their friends being able to visit them, and they were particularly concerned about their family member being even more isolated because they have to leave their home. That is what's happened.
It is fine for the minister to say that those facilities have been converted into assisted living or some other forms of housing option, but it is not fine for the minister to say that those facilities have not closed, because they have. They have closed as what it used to be and how it used to serve the community. The use has changed, and that has impacted people's lives.
I suspect the minister will get up and, "Well, we talked to the family members and everything is fine, and they're all fine when we moved them," and so on and so forth. People might have said that to a certain degree, but let me tell you, I met with many individuals — seniors and their families — who told me they were not fine with this situation, but they felt that there was nothing they could do. They were told these are the criteria, and they're now no longer eligible. That was just the way it was, and there was nothing they could do.
There have been umpteen reports elsewhere which indicated that when you move a senior from their familiar setting that they've been used to for a long time, their health actually takes a negative decline as a result of that. I won't belabour that debate because the proof will be in the pudding, and the families are already raising this concern. In spite of the fact that the opposition is raising these concerns, the government continues to ignore them, and they continue to spin their spin and make their own arguments to give themselves comfort in what they're doing with this.
Now, let me just turn back to the numbers that I talked about. The minister rose in this House and said, "Well, see, it just goes to show that this planning document, this draft planning document, this discussion paper" — I should use the right terminology here — "shows that we are on exactly the right track" — save and except that throughout the document it highlighted a number of things, which the minister neglected to address.
That is, of course, that the rate of change with respect to those who need what was known as intermediate care levels 2, 3 and extended care remains relatively stable over the years. There's not significant change with respect to that. Then of course there is the cautionary note that I put on the record in terms of those who fall into the very-old age grouping — that is, the 85-plus. Those in the very-old age group would have higher utilization rates than those between 75 and 85 years old, and this should be taken into consideration as the planning process of the development of a model for home support, assisted living and residential care services is taken into consideration. That is in the context of the 25,000 base units that the minister referenced.
When you take the 25,000 base units and subtract the number of beds that have closed, that's 2,369. Those are the intermediate and long-term care beds that have closed, and that is the 25,000 base number of interme-
[ Page 9023 ]
diate and long-term care beds. Then we need to account for the fact that there's a reduction in number in this area of high need.
I know the minister will say: "Well, you know, just because people's situation may well be very complex, it does not necessarily mean that they actually need the higher-level service of intermediate or long-term care beds. It may well be that all they need is the right and appropriate support so they can stay in their own homes, etc." I'm not necessarily quarrelling with the minister on that, other than to say as a caution that while the government is closing intermediate and long-term care beds — or converting them, as the minister likes to call it — the fact remains that those higher-service-needs beds will be gone. It does not necessarily — and my fear is it doesn't — provide for the needs of the community the way he said he has committed to.
I just want to make one last statement about this. The list that I put on record was the information that I've received. I think that, substantively, the facilities that I put on record as having closed have closed. It does not offset the closure when the minister says that they've been converted to another use. It does not offset the closure.
It may be — and I will admit and I'll stand corrected — that there might be one or two facilities that I put on that list that were wrong. There might be a few, and I would fully acknowledge and stand corrected on that, but substantively the list that I put on record is correct information. Even when the minister says the closure will not happen until the conversion or some other thing happens in the community, the fact remains that those beds are either closed or are planning to be closed.
With that, Mr. Chair, and noting the time, I move that the committee rise, report progress and ask leave….
The Chair: It's not necessary to report out. We'll just have a recess until 6:35 p.m.
J. Kwan: Oh, okay, we'll just have a recess.
The Chair: Does committee agree to have a recess until 6:35 p.m.?
The committee recessed from 5:54 p.m. to 6:37 p.m.
[K. Stewart in the chair.]
On vote 25 (continued).
B. Suffredine: Today I attended a presentation by the Canadian Breast Cancer Foundation. Breast cancer is the number one concern of Canadian women in their health. The theme for the foundation for the year is "Smaller tumours earlier," sending the message that detection is the key to successful treatment.
I was personally disappointed to learn that although the World Health Organization recommends that 70 percent of women have a mammogram at least once every two years, in my region of Nelson-Creston only 39 percent get that test. That's probably due to either a lack of education or a misunderstanding by the public of what's involved in getting a mammogram. I understand there are even women who report when surveyed that they've had the test within two years. It is hard to imagine how they'd make that mistake, although they might just be making a mistake as to how long ago it was.
It seems to me that the savings to the health care system, if we can improve the participation rates in mammography, are pretty obvious. We don't really need to use our imagination very much to figure out how much it would save if disease were detected early and treated accordingly.
Could the minister give us some insight? I'd appreciate if you'd elaborate on what the ministry is doing. What's its strategy to deal with breast cancer education — educating women on the need to go for mammograms, correcting some of the misunderstandings and educating the public? Added into that, if you have any advice for us as MLAs in terms of how we can assist in that strategy….
Hon. C. Hansen: We certainly had a very useful presentation this morning from the Breast Cancer Foundation and the work they're doing around trying to build public awareness of the importance of mammography screening. We are pleased as a ministry to be partnering with the foundation and to work with them, as we have done over the last number of years, to ensure that more women are aware of the importance of this.
The good news is that in British Columbia we actually have the highest number of screening mammographies done on a comparative basis as compared to any province in Canada. In fact, I believe we're significantly ahead of even the number two province when it comes to the percentage of women in those target age groups who do get a regular mammogram.
The bad news is that even though we're ranked number one in terms of the number of women who do get a mammogram on a regular basis, we still haven't even hit 50 percent of women in those particular target age groups. I think the member mentioned 39 percent in his particular part of the province. The provincial average is about 49 percent. So we still have a way to go to hit that World Health Organization target of 70 percent. The good news is that we're making some progress.
I believe there is probably a direct correlation between the mammogram program we have in this province, which we should be proud of, and the fact that we also have the highest survival rate of women who are diagnosed with breast cancer. In fact, in this province 85 percent of women diagnosed with breast cancer
[ Page 9024 ]
now will still be surviving five years later. That is the highest percentage of any province in Canada.
Clearly, we have to do better. We have to do more. It is an ongoing part of our public education program. It's an ongoing part of the preventive health messages that we try to put out as a ministry and from the health authorities — to encourage women to get that regular mammogram. We certainly will continue to work with organizations like the Breast Cancer Foundation to make sure that message is communicated.
R. Hawes: I just want to follow with one question along the same theme. This morning the Canadian Breast Cancer Foundation may have heard for the first time — they hadn't thought of it — that one of the deterrents women potentially face in getting a mammography in the travelling vans is the fact that they are travelling vans. A travelling van parked in the parking lot of a shopping centre is perhaps not that attractive to anyone and not really conducive to anyone stepping forward to get a test they should get. The comparison they used was for men. A travelling van for prostate exams wouldn't exactly be attracting a huge crowd at a shopping centre, I don't think.
I'm wondering through the minister…. Is it possible for your ministry to work with the Breast Cancer Foundation to take a look at whether or not that travelling van situation is in some cases deterring women and whether there is another way it could be done with a portable or with a moving mammography machine?
Hon. C. Hansen: There are actually two issues around the use of the travelling vans. First of all, the travelling vans are used where there is not a significant enough population base to warrant putting in a full-time permanent location. There are two things that flow from that. One is just the cost of the equipment that is necessary, but the other is the availability of technicians. These are specially trained technicians who will operate the equipment and do the screening mammograms. You couldn't simply have a part-time technologist who is also doing other radiology work, for example.
The vans are certainly a good opportunity for women in smaller communities to get access in their own communities. The other choice that would be open to them is to travel to the next closest permanent facility, and that would certainly be an option to them.
They do collect a lot of data through the B.C. Cancer Agency, and we'll certainly look at what that data shows. I'm not sure how quickly I can get it. It probably might take a few days or a few weeks — I'm not exactly sure — but I will try to get more information to the member in that regard.
The other thing I should point out is that the equipment that's used needs to be standardized on a regular basis. It's not only the cost of the equipment and the availability of the technicians but also making sure the equipment that is there is properly monitored and properly adjusted so that we're getting accurate readings.
R. Hawes: Thank you for that, minister. One of the things they did point out when they were here this morning meeting with a number of MLAs was that they have taken a look at a whole broad cross-section of reasons why women aren't accessing regular mammography. Fear is part of it. There is a whole range of reasons that they have identified. I'm not sure whether those have all been shared with the ministry. I think 90 percent of what they find probably is solved through education.
I know they did talk about finding a way to liaise, actually, with the Education ministry to get their word about the importance of mammography into the public school system so that even kids could take that message home to their mothers and in a lot of cases their fathers, who can harp just as much as anybody at their wives to have this sort of thing done.
I wonder: is there a way to build a link with the Canadian Breast Cancer Foundation to ensure that we are using all of their information to build an education system across the province that's going to increase utilization of the service and that would maybe include an interministry link with the Ministry of Education?
Hon. C. Hansen: I am aware of the very excellent report that the Breast Cancer Foundation put out. I think it may be two years ago now. I'm trying to think of the date that it would have come out — a very helpful document that I know came from input they got from all around the province from their research, their surveys and the focus groups they undertook. That is a document that the ministry is familiar with and certainly becomes part of the pool of information we use in developing policy and programs.
There is a lot of work being done around school curriculum. My ministry is actively involved with the Ministry of Education around health-related curriculum. We are, for example, doing a fair amount of work around tobacco use. The idea of having breast health and the importance of screening mammography is an issue that we'll certainly bring forward as well.
R. Hawes: Just to change to a different topic, I wonder if I could touch for a minute on the retention of health care professionals and where we stand today. You know, nurse retention and the shortage of nurses has been an issue for quite some period of time. I wonder, minister: could you outline where we stand with that today? Has the change to greater reliance on LPNs had an impact? If so, what impact has it had?
Hon. C. Hansen: This is an area where there has been a lot of work done with a lot of success over the last two and a half years around the recruitment and retention of health care professionals. For example, this
[ Page 9025 ]
province experiences the greatest in-migration of doctors from other parts of Canada to this province than any other province experiences in Canada. We have seen an increase in the number of doctors in this province each and every year.
The other thing with regard to nurses is that we have also had a lot of success around our nurse recruitment strategies. What we find is that more nurses are in fact staying in this province after they graduate from our colleges and universities. As of December of 2003, there has been a net increase of 1,120 new B.C. nursing graduates for that last calendar year. That amounts to 638 registered nurses, 443 LPNs and 39 registered psychiatric nurses.
The member also asked specifically about the use of LPNs. You can go back a couple of years when I know the B.C. Nurses Union had an advertising campaign on radio and other media talking about how registered nurses were being asked to do a lot of duties in the hospitals that weren't unique to their scope of practice. I think one of the things that has been quite helpful is to engage more LPNs in our acute care hospitals to make sure they can work within their scope of practice, for which they are fully trained, and thereby alleviate some of the workload pressures on our registered nurses.
We also, in our long-term care facilities, see facilities that in the past — when it came to nursing staff — may have been staffed almost exclusively by registered nurses when, in fact, LPNs are well trained to provide many of those services. We are seeing a much better mix emerging of different health care professionals, nursing professionals that have different skills. I think we're starting to see the success of some of those in alleviating some of the pressures that our individual registered nurses have felt in the province.
R. Hawes: Thank you for that, minister. Perhaps you could clarify, too, in the role of the LPN…. I may be wrong, but my understanding is that there has been some work to upgrade the skills of LPNs so that they can administer some medicines, etc., which previously perhaps they couldn't. I wonder if that is something that has been happening. If so, is that being well received, and is that program working?
Hon. C. Hansen: Certainly, there is the College of Licensed Practical Nurses, and they are responsible for and work very closely with LPNs around credentialing and education programs and making sure that the education programs we have throughout the province for LPNs are consistent and properly accredited around the province.
There has been an increase in the number of LPNs. There is also an opportunity for LPNs to advance their skills or to get refresher courses. If they haven't been actively involved in the full scope of nursing responsibilities in the past, they can bring their skills back up to speed through some of those programs. If you look at the breakdown of nursing staff, there are over 30,000 RNs in the province as of the end of December. There are almost 5,000 licensed practical nurses and about 2,150 registered psychiatric nurses, so the number of LPNs has been increasing.
The other thing that is important to note is that the education programs for LPNs are really spread out throughout the province. I know it's been a great opportunity for students in smaller communities to actually get access to LPN training in their very own community. As we know, they will tend to stay there and provide that nursing support in the communities where they live, so I think we're starting to see some progress.
R. Hawes: I know the deputy minister particularly has been a very keen advocate of primary health care reform, and a part of that, I think, is the development of nurse practitioners. I wonder: could you just let my constituents know where we stand, then, with the development of nurse practitioners? At what stage do you think we might start seeing the advent of nurse practitioners throughout the health care system?
Hon. C. Hansen: This is a great news story in this province, because last September they started the first class for nurse practitioners at UBC, that brand-new program to educate nurse practitioners right here in this province.
I'll just give you a bit of background. Nurse practitioners are registered nurses with advanced training and advanced skills. They will be authorized to perform the full range of nursing functions plus a number of functions traditionally done by physicians: diagnosing, prescribing, ordering diagnostic tests, managing common acute and chronic illnesses, and referring to specialists. Nurse practitioners are formally recognized and regulated in most Canadian provinces, so this is certainly a new phase in health care in B.C. that's going to fill a lot of gaps that are there currently.
Just some of the key facts. We brought forward Bill 62 in the session last year, the Health Professions Amendment Act. That was introduced, and it is under the Health Professions Act that we will provide for the regulation of the nurse practitioners by the Registered Nurses Association of British Columbia.
In May of last year we announced that this new education program at the University of British Columbia and also at the University of Victoria would be established with a total of 30 new spaces, and those 30 students started those programs last September, as I mentioned. A third program is being developed at…. Actually, I better get this right here.
So that gives a bit of an update so far. It's a good-news story, and I think there are certainly lots of individuals in the nursing community that are very excited about this new advancement.
R. Hawes: Thank you, minister. I think that is a good-news story.
[G. Trumper in the chair.]
[ Page 9026 ]
Many of my constituents are extremely upset because of the changes that have happened in the local hospital where I live. I know this is not an isolated thing. Throughout the province people see change in their local community hospital, the place they've always had pride in. It's changing, and often people don't like change. It is causing some upset.
You know, I can see that the overall…. The way that acute care services are delivered is changing dramatically and, I'm guessing, not just in British Columbia. I think some of it is driven by the fact that specialists like to work together in groups. Some of it is driven, I suppose, by the advent of magnet hospitals. Perhaps from a fairly high level the minister could give an overview to my constituents, who are very concerned about the change in the local community hospital. What is changing, why is it changing, and when the change is complete, what is it going to look like? Will we have a seamless system?
Hon. C. Hansen: If we look back to the health care system that we have known in years past, it was really a very fragmented system where you had each hospital trying to be an island unto itself. Really, we didn't have the kind of linkages we needed between facilities. It was a very fragmented approach to health care and really left the patient sometimes scrambling between different facilities to try to get access to care that they determined was necessary.
What we have been moving towards over these last number of years is to develop networks of care and networks of facilities that actually can work in concert with each other. We want to make sure we have effective community-based hospitals and other facilities at the community level, whether they be emergency stabilization or primary care units. There are different models in even the very smallest of communities that can provide for that kind of emergency response, but we also need to make sure those are then linked into the next level of care so patients can be stabilized but then moved on to where they can get access to the next level of care.
When it came to how we deploy specialists in the province, in the past many hospitals were really vying with each other to try to attract a particular specialist to their community. Often that specialist would wind up being the sole specialist in that community and that particular discipline. That leads either to burnout, because they are trying to do the 24-hour-a-day, seven-day-a-week coverage, or to gaps in the coverage in those communities because that particular specialist isn't able to be available at all times.
One of the initiatives we've been undertaking is to try to say: "Let's make sure we have certainty to meet the needs of patients." That has meant building centres of excellence in regions throughout the province, making sure that we can in some cases consolidate the specialist coverage in that region so that they can be properly equipped instead of dividing the equipment budget across a whole range of facilities. Let's make sure the right equipment is put in place to meet the needs of groupings of specialists so they can work together as a team. They can cover each other off; they can avoid the burnout.
This is actually an approach that was recommended to us by the B.C. Medical Association when they talked in our health forum about two and a half years ago about the need to consolidate some of the specialist care around centres of excellence. We are now well on the way to doing that. The net result of that is we are able to show that more patients are getting access to the care they need in the regions where they live.
There are hospitals in this province that are now bona fide regional hospitals that had never been able to attract certain specialties in the past, so patients would have to go out. They'd have to fly to Vancouver or other major communities to get access to care. Now as a result of some of these consolidations, we've been able to build those specialist teams in those regions so that residents who live in those regions can in fact get care in those regions without having to travel outside. It is the making of a real success story, one that is being looked at by other provinces in Canada. They're certainly recognizing the success that we have in meeting the needs of patients rather than the needs of individual facilities.
R. Hawes: I'd like to ask one more question, because I see that the member opposite has, I think, some questions she does want to ask.
It's with respect to the ambulance service and the fact that we have created centres of excellence. Now we have a number of patients that are being transported by ambulance to other hospitals where at one time they weren't being transported. They perhaps were receiving a level of care in their own community. They may be accessing better care somewhere else, but when they come home or when they move around in the ambulances, quite often they get bills.
There's a lot of confusion around — at least there seems to be to some of my constituents and in my constituency office — what they should be paying and what should be covered by the health system. I wonder if the minister could provide some clarity on who's paying for what within ambulance transfers.
Hon. C. Hansen: Ambulance service is one of those non–Canada Health Act services that really is not…. We do not get any federal money towards covering the cost of our ambulance service. There is a small amount of the cost of the ambulance service paid for by the patient that is being transported. We do, in this province, have a policy of charging patients a portion of that cost, and that is a policy that's consistent in other provinces as well. Our rates for ambulance service in B.C. are, I believe, among the lowest in all of Canada and certainly by far the lowest in all of western Canada.
There is a policy that provides for 100 percent coverage of interfacility transportation of patients under
[ Page 9027 ]
certain circumstances, but there are others where the patient is expected to pay for their small portion of that interfacility transport. This, as I say, is consistent with policies in other provinces as well.
R. Hawes: I had just one more question, but that leads me to just ask for a little clarity on that last question. That would be: is there somewhere where my constituents, then, could get something that spells out fairly clearly which interfacility transfers are covered and which ones aren't? It's so my constituency office, at least, can have it so we can explain it to constituents as they come in with their bills, saying, "Why am I paying for this?" — so that we have a much clearer understanding.
Hon. C. Hansen: I can save the member the time by reading the policy to him and putting it on the record here.
"The only circumstance under which beneficiaries are not required to pay for an ambulance transfer is if (a) they are transferred from hospital where they are an in-patient to another hospital for required diagnostic/therapeutic tests and are returned in a 24-hour period to the referring hospital or (b) they are transferred between buildings of the same hospital facility. The hospital is responsible for costs of the transfer as well as the costs of any professional escort services provided in these cases."
Certainly if the member or any of his constituents have further inquiries on that, they can phone the health information line at the ministry, and we'd be pleased to provide whatever additional information any particular resident of the province might be interested in.
R. Hawes: My last question, actually, is with respect to lab reform. I get a lot of e-mails from constituents — and I'm sure others do too — who are very curious as to where we're going with lab reform. They are afraid we're going to go to a totally public system or that we're going to wind up having lab services provided from the United States — or any variation of all kinds of rumours that are out there. I wonder if the minister could just clarify, from a fairly high level: where are we looking to go with lab reform?
Hon. C. Hansen: The lab reform process that we embarked upon last August is still underway. At the time we indicated it was a process that probably wouldn't lead to a conclusion until about October of 2005. That was our target time line on this process. We have, up till now, had a system in the province that is really a mix of a public and a private model. We have the public sector labs in our hospitals that provide a very necessary function and also provide, in many communities, the community lab services as well.
To complement that, we have a very excellent private lab service in the province, with a couple of companies that really do a first-class job of mostly the high-volume tests that get done and that lend themselves to the mechanization and the robotics that those private companies use.
As we move forward, we want to make sure we have a system that gives, first of all, the patients and medical practitioners in the province the kind of service and the quality of service that they need. We want to make sure there are information systems in place so that information can be properly shared, trying to eliminate some of the unnecessary duplication of lab tests that we know gets done in this province.
Finally, we want to make sure we get best value for the taxpayer and that we get this necessary, quality service in a way that is cost-effective and gets the best value for each and every dollar that we're spending.
We are currently looking at trying to save some dollars. We believe there are some savings there, and we want to be able to reinvest those into the information systems that I talked about. But also some of the human resource needs…. We know there is demand for training of pathologists in the future and in-service training, and we want to make sure we have the financial resources to support those strategic initiatives as well.
As we move forward, we are still looking to having a strong and vibrant public and private sector mix of services at the end of this process, but we think we're well on our way to achieving the objectives that I set out.
J. Kwan: For the minister's information, the questions I'll centre on this evening…. I'll be trying to wrap up the questions around the long-term care–intermediate care piece, and then after that we'll be moving on to the service plan area. I had thought that we would be finished the long-term care–intermediate care piece by 6 o'clock today, but it turns out we didn't move through that with as much progress as I had hoped.
Anyway, I have a few more questions for the minister. Prior to the break we were talking about the input. The minister has received some of the input from health authorities and government officials regarding the discussion paper that we were talking about. I'd like to ask whether or not the minister would commit to making the input from these health authorities available to the opposition.
Hon. C. Hansen: As I mentioned earlier today, this is a discussion document that was designed to set out some of the options as an internal document in government. It wasn't written in a way that was meant to be circulated to individuals who were outside of government. As we've gone through discussion…. It's not like there's a formal response that I can say: "Yes, let's photocopy that particular pile and pass it along to somebody else." It's been the product of meetings and discussions around information that's contained in there, and as an internal document it is also part of an internal process that is not necessarily as structured as the member may imagine. It is one that gets the input from the various players, whether it's at the health au-
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thority level or at the ministry level. So the feedback I have is not in a form that would lend itself to circulating in that context, because a lot of it has in fact been verbal discussions in various meetings.
This is actually leading to policy initiatives. I'm sure that once government has made its decisions around those policy initiatives, we'll be pleased to share those with anybody and everybody.
J. Kwan: Well, given that the minister is not prepared to provide that information, and albeit it may not be in a tidy format…. Presumably, though, as the minister has advised, his ministry will be compiling that information so that it becomes a document for the minister's consideration as he works towards the model for intermediate care. Well, actually, that's the old terminology — intermediate and long-term care facilities for the seniors. When that document becomes available, once the bits of information — some of it in writing, some of it verbal from meetings — get compiled into a report for the minister, will the minister make that report available?
Hon. C. Hansen: As I'm sure the member knows, when we wind up with discussions and option papers that get developed within a ministry, it leads to a process of policy development. At the end of the day, all of that material is available through freedom of information. It is obviously a complex process that involves a lot of input, a lot of different formats and a lot of different ideas that come together.
There will ultimately be policy direction that will come out of all of this very good work that is being done within the ministry and in consultation with the health authorities, but I can't say at this point that there is going to be a particular document at a point in time in that process that's going to lend itself to public release. Certainly at the end of the day, there is opportunity for information to be accessed through FOI, and this material would be no exception.
J. Kwan: Well, that was what I was going to try and get at — that is, to see if I can access the information without FOI-ing it. I thought I'd give the minister a chance to see whether or not he will simply be cooperative in that regard. Obviously, that is not to be, and yes, we will be FOI-ing the information in that case.
Could the minister please advise: in regard to health authorities closing long-term care facilities and intermediate care facilities, what criteria, if any, does the ministry use or does the ministry provide to health authorities in regard to bed closures?
Hon. C. Hansen: I just want to be clear that I'm answering the right question here. Is the member asking about the criteria that are used by the health authorities to determine whether a facility should or should not be closed or the process they go through once they have determined that a facility would be closed or it has become necessary for change? Or would you like both?
Hon. C. Hansen: To determine closure. Okay.
There was a facility review undertaken of all the facilities in the province to look at the physical structure, at the design of the structures, what level of care it was appropriate for and whether it was still meeting the needs the residential facility was being put to in that particular community. In some cases it may determine that the facility is entirely appropriate, and it may also determine that there are certain renovations or upgrades that are needed. It may in fact indicate that it would be a candidate for conversion or, as is the case with some, it's a facility that is perhaps older and really not of use for the residential care needs we're going to have for the future.
It is based on that assessment that the health authority will start their plans. For facilities that need to be closed or converted, then obviously they will work with the owners of that facility, if it's under contract, and they will make sure they follow through on that process that's set out in the contract for the closure.
J. Kwan: In that process of a facility closure, does the ministry or the health authority engage with the seniors or the people who are living there? I don't mean after the decision has been made that the facility is going to close and then they are told afterwards that the facility is being closed — "therefore, we're going to move you," or whatever the case may be. I mean during the process of evaluation in determining closure. Do the residents know, and by the same token, do the people who work there know?
Hon. C. Hansen: A lot of the decision-making is based on the facility review in terms of whether the facility is still meeting needs. We wind up with facilities, for example, that were designed for a lower level of care, where suddenly the acuity levels of the residents has been getting higher to the point where in some cases facilities perhaps may not be wheelchair accessible in certain parts of it. They may have doors into washrooms that are too narrow to meet the needs of wheelchair-bound residents. Those are all factors that are taken into consideration. The other side is that you wind up with facilities that just become outdated and old and need either major renovations or to have whole new structures put in place.
Those are the factors that in most cases drive those decisions. In other words, it would not necessarily be appropriate to engage residents in a discussion as to whether or not the physical structure still had integrity to meet the needs of the residents going forward.
Once there is an indication that a facility may in fact be closed or converted, then there is a process of engaging with the individual residents where appropriate and/or their families. It's not always appropriate for
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the staff at these facilities or in the health authorities to directly involve a resident if they are at a stage where they're not capable of understanding some of those issues, which has happened sometimes. They will in those cases engage with the family. There is then a care plan put in place that makes sure transition needs are met.
There is a whole policy that has been handed to me around how…. It's actually titled "Residential Moves Resulting from Facility Renewal." It's part of the home and community care policy manual. I know the member was asking about engagement before decisions have been made. This policy would actually click into place once a decision had been made and a resident was going to be moved to a new facility. I can certainly go through that if she's interested.
J. Kwan: In other words, residents are not told when this evaluation is being undertaken to determine whether or not the facility is going to be closed. They're only told afterwards. That's the long and short of it as I understand the minister's answer. Staff are not told, either, until after the decision is made. If I'm wrong in that interpretation of the minister's answer, I would ask the minister to correct me.
On that basis, assuming that is the correct summary of the minister's answer, could the minister advise about situations where the facility is owned by a non-profit group? In that determination process of closure or not, is the non-profit group advised that the health authority is considering closing that facility or converting that facility?
Hon. C. Hansen: What we have seen over the last two and a half years is that in cases where there has been an indication that a particular facility may be a candidate for closure or renewal or whatever, which would involve disruption to the individual residents, that in itself causes huge concern in the residents and a lot of anxiety.
Two and a half years ago, when we rolled out a program that actually identified some facilities that may be candidates for closure over three years, it was one of those issues that I felt was a no-win thing. On the one hand, if people had said to us two years later: "You know, if you knew this facility was a candidate for closure, why didn't you tell us two years ago…?" On the other hand, people say: "Well, now you've told us this place may be a candidate for closure, and you can't tell us where the new facility is going to be built. We don't know what it's going to look like. We don't know where it's going to be located." We say: "Yes, but there is going to be one — right?" That would create all kinds of anxiety. I had family members telling me how concerned their family member was because they didn't know where they were going to be going.
I think the responsible thing for us to do as government and as health authorities in the province is to develop a planning process that gives that continuity so that when there is an announcement made around a facility that's going to be closed for perhaps renovation, the residents and family members are notified at an appropriate point in time. There's also information that can be provided to them at the same time regarding where the new options are going to be, what that change might look like, when it may take place and, hopefully, even some kind of an outline of the new facility.
What we found is that there are lots of people…. Lots of seniors go through all that anxiety about the move, and then when they get to their new facility, they're actually just blown away by how fabulous it is — a brand-new facility, an apartment-like home setting. Really, there have been some tremendous heart-warming stories of the reaction individual seniors have had when they get transitioned into some of these new and very modern facilities at the end of that process.
With regard to staff, there are certainly provisions set out in the collective agreement around when staff get notified of that kind of substantive change. We certainly try to make sure those provisions are followed. With regard to not-for-profits that the member indicated, we have in place, for each of the non-profit organizations in the province that are operating funded facilities for us, affiliation agreements that also set out the requirements we have in terms of appropriate notice and the kind of transitioning that would be necessary.
We are also trying to work with those not-for-profit organizations in those communities. If they are running a facility that has become obsolete and is in need of major renovation or perhaps relocation, then we do try to work with them to see if we can maintain the continuity of that organization's role in that particular community as we move forward into some new models.
J. Kwan: Presumably, the non-profits who get the notification…. Is that standardized for all non-profits, or does that vary from situation to situation?
Hon. C. Hansen: That would depend on the individual contractual relationship between the non-profit and the health authority that would have to be followed. Different non-profit organizations have different relations, non-contractual relationships, with their health authorities. There really isn't a standardized approach across the province to that.
One thing that's actually been brought to me by some of the non-profit facilities is their desire to have a standardized approach to this. As one of them pointed out to me, they wind up spending an awful lot of money on lawyers because with each different health authority, they wind up with different contractual models. It would make sense to try to develop one model that could be used throughout the province, the net effect being probably the saving of a whole bunch of lawyers' fees both for the non-profits and for the health authorities. I know that's something that's been looked at.
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J. Kwan: When the minister advises that the determination for either closure of a facility or an upgrade or conversion of a facility very much depends on the physical structure, what the needs are, etc…. Is there a standardized process which the health authority undergoes in making that decision? And included in that standardized process, if there is one…. Can the minister advise what that standardized process is — the steps that a person or the health authority goes through? Does it include a feasibility study, let's say, if there are upgrade or conversion requirements?
Hon. C. Hansen: This is largely driven by the facility review that was done. It was comprehensive. It looked at facilities throughout the whole province and really looked at what the physical condition of that facility was. That, in essence, is the kind of feasibility study that I think the member was referring to.
They also looked at whether a facility could be simply upgraded, whether it needed to have significant renovations or whether, in fact, it was obsolete and really would not lend itself to any kind of an upgrade or renovation. That is the basis upon which the health authorities have been planning.
From there, they also have to look at the individual contractual arrangements that they have with that facility. That would be the next step. Then they would have to look at the needs of the community and the opportunity for alternate care for residents who may be in those facilities. There's not a standardized sort of step-by-step process beyond that. But really, the feasibility that the member refers to, I think, is probably best driven out of the facility review that was done and that was looking at the physical structures.
J. Kwan: Is it correct for me to interpret that each of the facilities that underwent this process would have a feasibility study attached to it — that is to say, a feasibility study to determine how much the projected costs might be to upgrade it or to convert it and therefore to arrive at a conclusion either to close it down or to convert it, or whatever the case may be? Am I right in understanding that there's a feasibility study done on each of the facilities, and that was part of the consideration for closure?
Hon. C. Hansen: The term feasibility study, I think, can have all kinds of different interpretations to it, so I want to be specific that it is referred to as our facility review. It's undertaken by B.C. Buildings Corporation. They went in to do this assessment of the physical condition and physical needs of each of these facilities around the province. To the best of our knowledge, this was undertaken for all of those facilities with which we have contractual arrangements or which are in fact owned outright by the health authorities in the province.
J. Kwan: In this facility review that BCBC had undertaken, when they arrive at the determination in terms of the physical condition of a particular facility, etc…. In determining whether or not it should be closed or converted, presumably there are dollar estimates in terms of what the cost of upgrading might be versus the feasibility of not upgrading to a higher level of extended care or to a current acceptable level of extended care facility. On that basis then, the decision perhaps was made either (a) to shut it down or (b) to convert it to assisted living. Presumably, there are dollars attached in that evaluation.
Hon. C. Hansen: Actually, that took so long that I'm hoping I can remember the initial question now. I apologize to the member.
This may be helpful. It's a document titled Residential Care Facility Assessment, The Provincial Summary. Just to give you a sense of what's covered in this, in looking at the overall physical condition of the building, they do an overall physical condition rating. They do building component system which, as I understand it, are things like the heating systems and other infrastructure within the building, and then they look at identified remediation. This document, which is a provincial summary, does look across health authorities at the average annual identified remediation for beds. They have, in fact, gone to that amount of detail for each of these facilities across the province.
J. Kwan: Well, maybe I'll try and put my question to the minister this way. Normally — certainly in the housing sector, and that's where my experience comes from — if you look at the structure of a building, you say: "Okay, based on the physical condition of the building, the systems, the structures within the building, the heating system, the water, etc., if we want to" — let's just use housing, for example — "upgrade the rooms in that building into fully self-contained units with bath and kitchen facilities, etc., how much would it cost?" The feasibility study would sort of run some numbers and say: "You have to do this and this and this, and it will cost that much money." Alternatively, it would say: "Well, actually, if you tear the building down and rebuild it brand-new instead of doing the upgrading, it would cost this much money." We're talking about the same number of units, etc.
Then you're able to sit down and say, "Okay, an upgrade makes sense because it's less money," or you say: "Okay, an upgrade doesn't make sense, and there's no other value to the building — no heritage value or other things to take into consideration." Then the better option would be to tear down the building and build anew.
What I'm trying to get at is that in this facility review process, for each of the facilities that was deemed to be not worthwhile to upgrade because it might be not financially viable to do so, the option therefore was either to close or to convert it to a lesser one, such as an assisted-living unit.
My question to the minister is on the evaluation of the facility review. Were there dollar signs attached to
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it, so that you can arrive at the determination that closing the facility is a better option — more financially viable — than upgrading it, as an example? Now, that's setting aside the other question about the needs in the community. I'm just looking at the financial evaluation of these decisions.
Hon. C. Hansen: To try to answer the member's question…. The facility review did try to put some values on it, but the detailed work around how much it would cost to rejuvenate a facility or to renovate it really would require more work by the health authority or by the organization that owned the facility, if it wasn't in fact the health authority.
There is a policy in the policy manual that sets out facility suitability risk indicators, which might be helpful to the member. If I can just read this, it might be helpful:
"To assess facility suitability risk relative to the needs of complex care clients, health authorities are required to develop facility suitability risk indicators consistent with the following indicators.
"Facility physical condition. First, the facility is near the end of its building component life cycle, or the facility's building components require significant investment to meet current client and staff user requirements. Examples include separating flooring, leaking window seals, faded and separated ceilings, difficult-to-maintain air volume and temperature requirements, inadequate lighting. Secondly, the facility does not meet building and fire code sprinkler requirements."
Then it also talks about the facility functional condition:
"The facility designed does not meet current legislative requirements. Examples include small client rooms; inadequate ratio of private to multi-client rooms; inadequate client nurse-call and visual-monitoring systems; limited lounge, dining or activity space; client rooms lack ensuite washrooms. Facility does not meet the accessibility needs of clients, cognitive or physical. Examples include narrow window widths; small washrooms; limited or nonexistent secure outdoor areas; long, narrow and dead-end corridors; limited or nonexistent security within the building pods; lack of socialization spaces for small client groups.
"The facility designed does not meet current program requirements for the type of clients approved for residential care due to the facility's physical constraints. Examples include limited wheelchair access; small washrooms; limited or nonexistent ceiling lifts; inadequate space for clean and soiled utility; lack of storage, linen and service cart space; narrow and congested hallways; small client care stations; small or nonexistent staff education areas.
"The facility does not achieve the goals of a homelike environment. Examples include outdated colours and decor, institutional finishing and lighting, lack of space or shelving for personal memorabilia.
"The process to access residents' needs and evaluate the suitability of facility preferences selected by the resident and/or their family. The process to communicate the resident's current clinical and/or special clinical needs to staff in the receiving residential care facility or the operator of the assisted-living residence."
Well, I guess that's not necessarily helpful on those last two points.
This gives a bit of a sense of the kind of factors that the health authorities look at when evaluating whether or not a facility is still useful or whether it should be phased out or renovated. There is a lot of detail in the guidelines and a lot of factors that are looked at in trying to do a full and complete assessment of any particular facility.
J. Kwan: In other words, a full feasibility study, it sounds to me, was not done for the determination of whether or not a facility should be closed or whether or not it should be upgraded or converted. It's really just left up to the health authority on a case-by-case basis to decide whether or not they want to do that or for the society to decide whether or not they want to do that. Am I correct in this summary of the answers that the minister has given with respect to this question?
Hon. C. Hansen: We do have the policy that I just enunciated around the indicators that the health authorities are asked to look at. Each health authority has to approach in their own way how they determine the feasibility of a facility. Certainly, I know they do a comprehensive job. There is not a standardized approach that is utilized by every single health authority.
You know, I know that just the term "feasibility study" can mean an awful lot of things. Is the feasibility of each institution studied in detail? The answer would be yes, but each health authority would approach that challenge in their own ways to meet the needs of those communities.
J. Kwan: Yes, the minister provided the policy for evaluation for the facility review, but it does sound to me like…. I'm not necessarily questioning whether or not the job was done thoroughly. I do know of some cases that people have raised to me around the different perspectives on whether or not a particular facility could be upgraded and whether or not it's a financially viable option to upgrade it as opposed to tearing it down or shutting it down. I know there are varying opinions around that, which is why I'm trying to get at this question and get the answer from the minister.
That is to say that when I talk about a feasibility study, I don't mean, generally speaking, going to a building and looking at the physical structure and giving it a rating of, let's say, 1 to 10 or whatever the case may be. I don't mean to say to look at the building component in terms of its systems within the building and then give it some sort of rating, etc. I'm sure that was done thoroughly by BCBC for all these buildings. Sometimes, in some cases, I would think that a further step needs to be taken, and that is for a full feasibility study to be undertaken.
When I talk about a full feasibility study, I'm talking about full evaluation of the cost benefits required to either upgrade the building or convert the building so that one could actually arrive at the decision, hopefully, soundly with that background documentation.
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That's the question I'm asking of the minister. Is the minister aware of that kind of full feasibility study being done for the facilities that have closed?
Hon. C. Hansen: I think that if you look around the province, there are certainly differing needs. A one-size-fits-all approach to this simply wouldn't work from a couple of perspectives.
First of all, I am aware of health authorities that indicated that they felt a particular facility was beyond its usefulness and properly should be closed and relocated. After they sat down and worked with the owner of the facility, I know of one in particular where the health authority actually agreed that yes, it could probably be rejuvenated. That is now the plan.
The other challenge that a lot of health authorities have is how to make sure that the needs of the patients get met during this time. You may have, in a small community, a facility that may still have a new life ahead of it potentially, but the challenge is that there is not another alternative facility into which to move the residents while you renovate this. Instead, they will wind up….
I know of one community where this exact process is happening, where there is a brand-new facility that is being built to meet the needs of those residents. Once the residents are moved out of the old facility into this brand-new facility…. The old facility could potentially have been renovated to continue to provide assisted living or complex care, but to do that would then have resulted in far more units in that community than they were going to need.
The alternative, then, is for that facility to be renovated into some other kind of use for the community. The one I'm thinking of is where they're looking at providing housing for low-income seniors. It wouldn't actually be a care facility in the sense that it had been historically, because that's now been replaced with a brand-new facility. It allows that old facility to be renovated and have a new life into the future, but it would not be with a health care component attached to it.
I think we have to look around the province to look at the individual needs of those communities. I have every confidence that the health authorities are trying to be sensitive to those community needs and the needs of the owners of these particular facilities.
J. Kwan: I wasn't suggesting that one-size-fits-all was the solution here. What I was asking the minister was if in fact any full feasibility studies were done for any particular facility. I'm still uncertain as to whether or not a full feasibility study has been done for any of the facilities. Maybe it has, and maybe it hasn't. I'm not quite sure if the minister knows himself. Maybe that's why we get these answers that sort of just swim around the periphery of it.
Let me just cast that aside for a moment. I'll just take from the minister's answers so far that….
[J. Weisbeck in the chair.]
Oh, I thought there was something else happening. I realized all of sudden that maybe it's 9 o'clock already, but it's just the changing of the guard, as they say.
In any event, I would gather that maybe the minister doesn't know whether or not full feasibilities have been done for any of the facilities that have closed. Maybe it has; maybe it hasn't. I'm not sure, from the minister's answer and the way in which he put it. Let me just make the assumption that, generally speaking, it sounds to me that full feasibility studies have not been done, and we'll leave it at that.
I know that a facility in my riding, Cooper Place, was closed, and then it was converted into assisted living. I know that prior to the closure of Cooper Place, it was meant to be upgraded and in fact expanded into a larger long-term, extended care and intermediate care facility. After the election those plans came to a halt, and the tables turned. The facility then was closed and now has been converted into assisted living.
I also know that lots of work has been done on that facility to determine the need for expansion and that lots of work has been done in that community to determine the need for expansion. Even the previous government, by the way, had actually set aside dollars for that expansion. After the election, as I say, things had changed and everything was completely different. Closure then came for Cooper Place, and it became assisted living.
So this is why I raise the question around what kind of work has been done and to what extent. It does raise a lot of questions for a lot of community groups where they see their extended care facility or long-term intermediate care facility close. They're not necessarily as comforted as the minister is by the evaluation work with respect to that.
In my travels to other communities, I heard the same thing in other community groups when they came forward with their information. In fact, some of the non-profit societies themselves have actually undergone a full feasibility study to determine what the costs would be for an upgrade of that particular facility. Nonetheless, the government made a decision to shut down their facility as well. This is, again, irrespective of need. The need is clearly there, and it was established. So I'm less comforted by the minister's assurances that everything is fine and that the facility review was done in such a way that warranted each of the closures and more closures that are pending.
In any event, I'm going to set that aside, because no matter how I ask the questions of the minister, I don't think the answer is going to be forthcoming. I suppose we can dwell on this for days, but really there would be no point if the answer is not going to be forthcoming.
Let me then ask the minister this question about Independent Living B.C., which was formerly known as supportive living. The government had actually brought forward two acts, as the minister knows: the Residential Tenancy Act and the community care act.
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Neither of these two acts provides for protection for seniors in living arrangements. When I talk about protection, I'm talking about almost like tenancy right protections. None of these acts addresses the protection for seniors in facilities such as long-term care or intermediate care facilities and the like.
Could the minister please advise: why is that? And given that none of these acts provide protections for these seniors, what mechanism is available for the seniors?
Hon. C. Hansen: This again, I think, goes back to the discussion we had yesterday about the role of the Ministry of Health Services. Our role is to provide for the health care services or to ensure they are provided for — that we have health care supports for individuals that are done within proper standards.
When it comes to the tenancy issues that individuals are faced with, it really falls into other ministerial responsibilities, including the Solicitor General and Community, Aboriginal and Women's Services.
J. Kwan: The trouble is that when these questions were asked of the other two ministers last year when the acts were debated, each and every one of them pointed to somebody else. Somewhere along the line it's got to land somewhere. Given that protection for seniors in terms of their accommodations' protection and the rights within it impacts the health of those seniors, one would assume that perhaps this would be the right place to ask it. As I mentioned, I asked the Solicitor General these questions when we debated the tenancy act, and he said: "Well, it's not me. Go and ask somebody else." I asked the former Minister of Community, Aboriginal and Women's Services, who has the responsibility for the community care act, and he said: "Not me. Ask somebody else." So I'm not quite sure who else to ask when everybody says it's somebody else's responsibility.
Given that this does impact seniors' health and given that health care support is a component of this minister's responsibility, then maybe the minister can advise me: has he even looked into this question? Has he even brought it up with his colleagues and said: "Hey, wait a minute. The seniors, to whom I'm in charge of providing health care support, have no protection here, and I'm a bit worried about that"? Who's going to take on the responsibility and own up to it and say: "Hey, I will take questions on that, and in fact I will address it, and there's some sort of plan in place"?
Hon. C. Hansen: It might be helpful if I give the member a sense of the responsibility that we have from the Ministry of Health Services with regard to assisted living. That's with the new registrar that has been put in place and the responsibilities that she has. This paragraph, I think, probably helps to define what the scope of our responsibility is:
"The new registrar will establish health and safety standards for assisted living in line with the new Community Care and Assisted Living Act, which will come into effect later this year, and will require all public and private assisted-living residences to be registered. The registrar will also resolve concerns related to standards, such as complaints of abuse. In addition, the registrar will have the authority to conduct independent investigations of both public and private sector assisted-living residences."
In terms of the scope, it is very much focused on the health and safety concerns. Because these are apartment-like settings where the seniors do have a measure of independence and the ability to direct their living environment, in that regard the questions around tenancy issues should probably be put to another minister. Off the top of my head, I'm not sure exactly which minister those issues could be addressed to, but I know that they don't fall within Health Services.
J. Kwan: Has the minister asked or talked to his colleagues about these issues around protection for seniors and raised the matter with any of his colleagues?
Hon. C. Hansen: Certainly, I've had discussions with regard to the health and safety issues that this ministry has to be concerned with. Quite frankly, I think the new registrar is taking an excellent approach to making sure that those issues are covered. I guess from the perspective of the Ministry of Health Services, I think we are living up to our obligations. I leave it to my other colleagues to make sure that the things that fall under their purview are adequately supported.
J. Kwan: Unfortunately, it isn't. I remember when the minister was in opposition he used to call on the government to speak with one another in terms of areas of concern, so that the right hand knows what the left hand is doing, and to work towards cross-ministerial responsibilities. That, it certainly appears to me, is no longer the standard the minister is holding against himself and this government. Quite frankly, it's not good enough to say, "Well, my only area is around health and safety standards," even though the other issues impact the health of these seniors. They do, when we're talking about potential residential tenancy protection for seniors. It impacts their health when they don't know where the protection comes from, what act applies to them and to whom they appeal when issues arise.
The questions around this front, as I mentioned, I have asked the Solicitor General. When we debated the Residential Tenancy Act, the Solicitor General said: "Not me. Don't talk to me about it. I'm not responsible." Then when it was raised when the community care act was being debated in this House, the minister responsible said: "Not me. Go and ask somebody else." So the food chain just sort of keeps on passing the buck, so to speak, and nobody is owning up to that responsibility.
Let me put on the record, then, that I hope the minister will take it upon himself to ask his colleagues and
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to say: "Hey, look into this issue, because it does impact the health of the seniors living in these units." I fully understand the minister's point in saying: "I only have the health care support component." But because the health component of seniors would be impacted in understanding the overall picture of their living environment and where they get their protection from, I hope the minister will take it upon himself to ask his colleagues to say who is responsible and then actually own up to it and do something about it.
Let me then ask the minister this question. Last year, when I asked the former Minister of State for Intermediate, Long Term and Home Care about how much it would cost the seniors in these different living environments, the minister of state said no more than 70 percent of their income. I just want to confirm with the minister if that is still the case. Is this still the threshold — 70 percent of their income?
Hon. C. Hansen: Yes, I think the former minister would have indicated a maximum of 70 percent of aftertax income, and that is the case.
J. Kwan: Is there a minimum or maximum cost?
Hon. C. Hansen: The member's question was: is there a minimum and maximum for the monthly rate that could be charged by a facility for a person to stay there? No. If you had a not-for-profit organization that wanted to highly subsidize units and, say, offer them at $500 a month for the accommodation and all the services that come along with it, that would certainly be within their ability to do that. On the other hand, if there was a private organization that wanted to do very high-end, exclusive assisted living that would be very, very expensive, they're free to do that too.
What we do have in terms of the amount a senior would have to pay in a facility that is subsidized…. The minimum amount would be driven by the old age pension and guaranteed income supplement for a single individual, which is $12,270. At 70 percent of aftertax it would make a minimum level of $714 a month that would be paid by those individuals. In that respect, from what the individual would pay, in fact there would be a lower end to that because of that calculation.
J. Kwan: Is it all-inclusive?
Hon. C. Hansen: Yes. It says: "The monthly fee includes a minimum of two meals a day, hospitality services such as laundering of towels and sheets, housekeeping services and personal assistant services such as assistance with dressing, bathing and taking medications."
J. Kwan: When the health authorities are placing seniors into their housing options, the consideration is not just for non-profit-run operations. It also includes the private sector operations. Because the private sector operations' costs range…. As the minister has said, it could be very high-end. It could be middle-of-the-way or whatever the case may be. In some instances, I think the number that's been put out there is around $2,000 to $5,000, generally speaking, for the private facilities.
When the government is working towards placing seniors into the housing option, is there any consideration made to placing seniors in private facilities? Is there any consideration of the senior's income — that is to say, whether or not they could afford it? If they cannot afford it and the only placement available is in a private facility that costs, let's say, $5,000 a month, does the government subsidize that situation? How does that work?
Hon. C. Hansen: The health authorities around the province would in fact contract with a provider. If you have an assisted-living facility being built that has, let's say hypothetically, 100 beds in it, the health authority may go in and contract for a certain number of those beds, a percentage of those beds. It would be at whatever rate the health authority had come to agreement with in terms of that facility operator. What we know is that in downtown Vancouver, for example, where land values are going to be so expensive, it's going to be quite a different monthly cost for those beds than it would be in other communities in the interior of the province.
When it comes to the rates the individual would pay when they stay in those, that is consistent throughout the province. It's still based on that maximum 70 percent of aftertax income. If you go up to a senior — this is a senior who would be in an assisted-living environment, so they would have been assessed with that level of need…. You would wind up with those, for example, with a gross income over $60,000. That would translate into an aftertax monthly income of about $3,500. Those individuals would be paying the first $2,440 of their care costs. With seniors that have very high incomes, they may not look to the health authorities at all. They and their families might prefer to go out and make their own arrangements with that private provider. This program we have to provide subsidized assisted living is aimed at low- and middle-income seniors.
J. Kwan: Is it fair to assume that no senior would be turned away from a subsidized program where it is required?
Hon. C. Hansen: The process of placing a senior in a particular subsidized unit is really one part of that whole process we talked about earlier today. There's an assessment done that then determines the level of support that individual may need. They then work with the family and the senior to determine what options would be available in that community. That could lead to assisted living. If it was a situation in that particular community that there were not subsidized beds available at that particular time, then it may wind up with
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support so the individual could be fully supported in some other type of housing option — perhaps until an assisted-living option did become available. It really is an individual process to try to determine the individual needs and make sure those get matched up with appropriate resources in those communities.
J. Kwan: Yes. But in other words, it does seem to me that — after the assessment eligibility criteria to determine what level of care the senior might need and then talking to the family about what housing option is available where the senior may need subsidized or support services — they will not be denied. That's the bottom line that I think I heard the minister say.
Hon. C. Hansen: Yes. A low-income senior who is assessed with a level of need would get subsidized support services, but those support services could come in a variety of forms. Just because a particular assessment of need is done, it doesn't necessarily lead to an entitlement for a particular type of support. But definitely the subsidized support would be available.
J. Kwan: I just want to go back to this question with respect to health and safety standards. I forgot to ask it, I should say, with respect to that. Does that include things like cleanliness, security, emergency situations that arise in the facility? Is that what would be included as part of the health and safety standards that the minister talked about?
Hon. C. Hansen: We were trying to find out if there was some explicit reference to that. But certainly, given that the registrar's responsibility includes the health and safety concerns of residents and also involves trying to follow up on resident complaints…. If there were complaints that involved either safety issues or cleanliness issues, that would certainly be within the scope.
J. Kwan: Can the minister advise who the registrar is? How does one access this person to register a complaint or raise issues?
Hon. C. Hansen: The registrar is Susan Adams, who has been appointed to that position. She can certainly be reached through the Assisted Living Registration Project team at the ministry here in Victoria, or she could be reached by telephone through the ministry switchboard.
J. Kwan: Just for ease of reference, does the minister have that number? Do we just phone up the switchboard and then have them be referred?
Hon. C. Hansen: You would think we would know the ministry's phone number here for the general switchboard. This is a document Susan Adams is using in her consultations around the province. It's titled Assisted Living Registry Project Consultation, and it sets out the role of the registrar and the role of assisted living. If I can read from one section here, it says: "If you have any questions about the discussion papers, feel free to contact the project manager." The phone number that is given here is 250-952-3591.
J. Kwan: Thank you very much. I actually have trouble remembering the Enquiry B.C. phone number, which I keep telling my constituents they should phone so they don't have to pay the long distance charges. I know it is difficult for a lot of people to try and find the numbers, which is why I asked if the minister could put that on record just for ease of reference for people.
Hon. C. Hansen: There is also a website that individuals may want to go onto, which is www.healthservices.gov.bc.ca/assisted/index.html.
J. Kwan: Thank you to the minister. That winds up my questions with respect to intermediate care, long-term care, independent living, supportive living, etc. We've got about half an hour, and I'd like to turn to the service plan area if that's okay with the minister.
If the minister is ready, my first question to the minister regarding service plan issues. Under the services delivered by the partners section, there is the regional health sector funding line. We can see clearly from last year's restated estimates for the '04-05 estimates that there has been a reduction from $6.594 billion to $6.495 billion. That's almost $100 million less. Could the minister please explain the reduction?
Hon. C. Hansen: This is as a result of a change in the accounting treatment of capital. The health authority funding has actually gone up from last year to this year, but the reason it appears this way is that there's an adjustment that involves the major capital grants that in the past had been treated as operating dollars. What it was is that there were certain thresholds that up to a certain level of expenditure the health authorities could treat as a capital expenditure, and anything over that would have to be considered capital. As a result of the shift to generally accepted accounting principles and the need to standardize the policies used by the ministry and the health authorities in terms of accounting practices, these had to be standardized under the new generally accepted accounting principles. As a result, there is $89 million in this coming year's budget that in the past would have been considered as operating for small capital expenditures. Next year it's going to be considered as capital expenditures, so it actually gets moved down into the consolidated capital plan budget.
There is also another amount that was previously in the health authority budget that was allocated for emergency health services. That is being moved into the operating budget for emergency health services under the ministry. It comes down to accounting changes, but the bottom line, after you factor those things out, is that there is a net increase in the actual operating allocations for the health authorities.
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J. Kwan: Well, maybe the minister can give me the breakdown of the operating dollars for each of the health authorities, then.
Hon. C. Hansen: The allocation for each of the health authorities has not yet been finalized. Part of the process is once the budget is public information, then we can start working with the individual health authorities as to what their share of that regional program is. We now know what the regional health sector budget is, as the member has in the estimates book, but that then gets divided up based on the population needs–based funding formula that we have in the province. That is currently being worked through with each of the health authorities. We expect that basically as soon as it is available we will, of course, make that allocation public as it pertains to each of the health authorities.
J. Kwan: This brings me right back to estimates debate last year. I remember going down exactly this path with the minister when the question was posed to the minister about the breakdown of each of the health authorities and how much money they have. The minister, for quite a bit of time, talked about how he doesn't have that but all in the meanwhile maintained, though, that he was sure the health care needs of British Columbians would be met by the health authorities. After much back and forth in terms of this approach, the minister finally actually came up with numbers with respect to how much the health authorities are expected to get, generally speaking. The minister actually finally came up with a number.
I suppose we can go down that path all over again, as last year, but I would really rather not. Maybe we can just sort of cut to the chase and bypass that, and have the minister just give me the ballpark numbers of what he expects each of the health authorities would be getting in terms of their operating budget.
Hon. C. Hansen: The way this process works…. It is not the same as the process was under the previous government. What we have done is allocate the total amount of the budget for regional programs, and then it is divided up based on the population needs–based funding formula. That formula will factor in not just the number of people living in each region but also the cost drivers for each of those regions, so those regions that have a very high percentage of older population that have high health care needs get more money. Health authorities that wind up with many of their residents getting care outside of the region they live in…. That is, for example, the case in the Fraser health authority, where many residents, in fact, get their health care in downtown Vancouver or in the Vancouver coastal health authority. That gets factored in. There's a cost driver that's factored in, in terms of the number of residents that live in rural or remote areas beyond a certain distance to an acute care hospital. Those things all get factored in together under this formula.
The good news is that every health authority in the province gets its fair share of the budget that we have, but it does take a fair amount of calculation to determine how that formula will in fact flow out to the number. We're in the process of doing that now, but I don't have those final numbers yet. I can tell the health authorities that they will get that number a lot faster than they have in the past. I know, for example, that prior to the election there was one year the health authorities didn't get their budgets until the end of October, even though the ministry budget as a whole came down, obviously, prior to the start of the fiscal year.
We are getting that process sped up so that health authorities do have some certainty around their budgets. We're still trying to sort out the exact application of that formula to determine exactly how much flows to each of the individual health authorities.
J. Kwan: Well, it feels like we are going down exactly that path we went down last year. I've just sent a note to my staff to bring Hansard from last year, because I remember this exactly. We sort of entered into a high-level debate back and forth, back and forth, until finally the minister came clean and gave the numbers at least that he's projecting right now.
We already know, generally speaking, what the population looks like in each of the health authorities. There might be minor shifts and changes, but we do know generally what that looks like. We know what the global budget is for the ministry. That has been done and is now in the budget book. The only factor we don't know is the federal government dollars, and that remains a bit of a question mark.
Given what we do know, what is the estimated budget for each of the health authorities? Surely the minister has this information, and surely the minister can share this information. If the minister doesn't have this information, how can he be sure the budget he now has and his responsibilities with the notion that he's going to ensure, with any level of credibility, that health care needs are being met when we need them and where British Columbians need them…?
Hon. C. Hansen: I'd be pleased to walk the member through how the population needs–based funding formula works, but I know that's not what she's asking for. We do have the base budget. As I say, compared to the environment that health authorities were operating in three and a half years ago, they certainly will get the certainty around their budget number much, much faster than they would have three and a half years ago.
J. Kwan: No — the minister is exactly right — I don't want to know about the funding formula. I want to know the figure that the minister estimates each of the health authorities would receive for their operating budget. The minister says time and again in this House, with a certain level of authority and certainty,
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that British Columbians' health care needs will be met, and that this government is prioritizing health care, and so on and so forth. Yet when we ask him for the details around how that breaks down in terms of funding for each of the health authorities, he says he doesn't have that information. If he doesn't have that information, how could it be that the minister could say health care needs are being met around the province?
Hon. C. Hansen: You know, quite frankly, when I was the opposition Health critic in this House and I tried to get a sense of how the regional health budget was assembled under that old model, I tell you I was quite exasperated by trying to get that kind of basic information. At least now there's a formula in place that everybody understands in terms of how that budget gets allocated.
I'd certainly be pleased to share with the member the 2003-04 base budget for each of the health authorities from which we are working. That will give a sense of how it was allocated at that time. Fraser health authority, $1,358.7 million; interior health authority, $908.7 million; northern health authority, $313.2 million; Vancouver coastal health authority, $1,647.7 million; Vancouver Island health authority, $984 million; provincial health services authority, $839.9 million; and the Nisga'a Valley health board, $600,000. So that is the breakdown we are working from, and that does not include the capital expenditures. That's just their base operating dollars that had been allocated to each of the health authorities.
J. Kwan: Just for the sake of discussion at this point — and I'll come back to the '04-05 operating budget for the health authorities — when did the minister have the finalized figures for the health authorities for '03-04?
Hon. C. Hansen: The initial allocation…. If you go back to where we were last year, as the member indicated, we did not know what the federal moneys were going to be. So in fact when the budget was tabled last year, there was a placeholder for the budget for the two ministries of Health, and we could only finalize that once we knew what the federal money was going to look like and how it was going to flow. The letters of allocation for moneys were held off until such time as we were able to confirm how the federal money was going to flow. Approximately the middle of June is when the health authorities got that final number.
They were given a notional number earlier on in the process, and that's our intention again this year. We will give them an initial allocation based on this regional budget that we've just talked about. In addition to that, as has been indicated by the Finance minister, there are the additional moneys that will flow from Ottawa as a result of our share of the $2 billion allocation.
What we still do not have confirmation on is how that additional money will flow to British Columbia. We do know that B.C.'s share of that money is $260 million, but it is to be allocated over the term of the health accord, which was to be a three-year allocation.
What we are still trying to work out…. I understand there are discussions that involve the federal comptroller general — I'm not sure if the federal auditor general is involved; certainly the provincial auditor general is involved, and the provincial comptroller general is involved — to determine how that money can flow into our budget over what period of time. Until we know that, we're not going to be able to make that second stage of allocation to the health authorities and to the other needs within the ministry.
We will certainly finalize this initial allocation of the amounts that are in the budget. There will be a supplemental estimate that will be brought to this House at some point to get authority from the House for the allocation of the additional moneys that will flow from the federal government.
J. Kwan: For the '03-04 budget year, the notional number given to the health authorities…. That's not counting the federal dollars that flowed. When did the government have the notional numbers for the health authorities?
Hon. C. Hansen: I think one of the things we had endeavoured to do was give the health authorities some certainty before the start of their fiscal year. That was the case last year with the exception of the federal money, which we still had to wait for certainty around. We expect to be on the same time line this year and that we would be able to provide that precise information to each of the health authorities prior to the start of the fiscal year. Then we will have to see when we get certainty around the federal money and give them that additional allocation that may flow to those health authorities.
J. Kwan: What I decipher from the minister's words is that last year the health authorities got their notional number just before the start of the next fiscal year. I think that's what I heard from the minister. Of course, noting that last year we did health care estimates in May…. It was much later, actually, so that the minister perhaps needed the extra time to put this information together and also to have a clear understanding of what the federal government's intentions were.
However, this year it's not the case. We're doing the health estimates now. Knowing that, one's got to know that these questions are going to come up with respect to the health authorities and their budget, and so on. Nonetheless, the government, in their wisdom, decided that we should be doing health estimates now, before they know what the federal dollars are going to be.
But here we are talking about this information. I remember last year — and I don't have Hansard before me…. When we adjourn today, I will go and look at Hansard from last year, because we engaged in this discussion exactly. I think that last year the minister didn't have exactly the numbers either, although it was
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in May, so it was one month away before the final numbers came in. The minister was able to advise this House what some of those estimated dollar figures might be for each of the health authorities.
I still find it hard to believe that the government and the minister do not know what those numbers look like — excluding federal dollars — now. I find that incredibly hard to believe. If that's the case, I don't know how the Finance minister can come up with the budget for the Ministry of Health. I don't know how the government can say they're going to meet health care needs for British Columbians when they don't know the authorities that will be charged with the responsibility of delivering the programs and when they don't know what their budget's going to look like for this coming fiscal — for the '04-05 fiscal year. I find that rather disturbing if that is the case.
Hon. C. Hansen: A couple of things flow from that. First of all, when it comes to the additional federal money that may flow, there will be a supplemental estimate that will be brought before this House. When that happens, we will go into Committee of Supply. Actually, we can go through all of this again. We've had so much fun yesterday and today. We can actually repeat it all over again when we do the supplemental estimates.
The other thing with regard…. She says: "How can the Finance minister make up his budget?" We approach the budgeting for the health authorities differently than was done in the past. It's not simply a case of all the health authorities submitting their budgets to us as to what they would like to have and then adding it all up and plugging that number into a budget. I know even that didn't happen before, because there was a lot of back and forth with the health authorities as to what their budget should look like.
Now we actually have in place a formula that says to the health authorities: "This is your fair share of our available resources that we have for regional health funding." Within that budget restraint, they have to pick their priorities. If there are areas of high priority that they believe need to be funded, it's not simply a case of coming back to the ministry and saying: "Send us more money." It's a case of them saying…. They will have to look within their own programs to determine areas of low priority where the funding should be reallocated to the area of higher need. In that way we can make sure that the priority needs of residents throughout the province in fact get met.
I think the system is working. The population needs–based funding formula is something that I think is long overdue. It is working. There are still some discussions as to whether or not it needs to be tweaked here and there. I think it is a much, much superior model to what was in place prior. As soon as we have the opportunity to work the numbers through that formula, then we will be providing that information to the health authorities, and that information will be made public.
J. Kwan: On that basis, given that the minister says he already knows what the funding formula is with certainty, then he must know the ballpark figure of what each health authority's budget is going to be, excluding federal dollars. It's not credible for him to say that he doesn't know and that they haven't actually worked through these numbers. That's just simply not credible at all.
In any event, there will be much more discussion around this front tomorrow, I'm sure, if Health estimates are called tomorrow. I don't know what the lay of the land is. We'll find out tomorrow at 10 o'clock, as normally we do as the opposition. Noting the time, at this time, Mr. Chair, I would move that the committee rise, report progress and ask leave to sit again.
The committee rose at 8:53 p.m.
The House resumed; Mr. Speaker in the chair.
Committee of Supply B, having reported progress, was granted leave to sit again.
Committee of Supply A, having reported resolutions, was granted leave to sit again.
Hon. P. Bell moved adjournment of the House.
Mr. Speaker: The House stands adjourned until 10 o'clock tomorrow morning.
The House adjourned at 8:54 p.m.
PROCEEDINGS IN THE
DOUGLAS FIR ROOM
Committee of Supply
The House in Committee of Supply A; H. Long in the chair.
The committee met at 2:50 p.m.
ESTIMATES: MINISTRY OF FINANCE
On vote 22: ministry operations, $31,297,000 (continued).
J. MacPhail: Does the minister have the information about capital city allowances for me?
Hon. G. Collins: I have some information. Perhaps the member wants to ask the question. I don't recall what the specific questions were that she asked. I can
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check Hansard if she wants, but I don't remember her question.
J. MacPhail: I asked for the breakdown of the…. The minister said there was $1.28 million, I believe, charged to his budget for capital city allowances, and I wanted the breakdown per minister, please.
Hon. G. Collins: There is the $1.286 million we spoke of yesterday, and $657,000 of that is capital city allowance, and $629,000 is travel to and from the constituency.
J. MacPhail: For the fiscal year ending March 31, 2003 — which is the last time this is available — which would have been a full year for which this government had ministers, the capital city allowance was $428,321. Why is the minister increasing that by 50 percent?
Hon. G. Collins: It's a forecast. That was based on…. I think it was a request sent to ministers on their forecast of what they thought it might be. It was sent to their offices. That was the forecast that was put forward by the ministers. They may well not expend all of that, but that was the forecast that was sent by the various ministers' offices.
J. MacPhail: It does seem to be an interesting increase. For instance, I have one minister here who claimed 169 days overnight in Victoria — lives on the lower mainland. There are several ministers here who are exceeding $20,000 in capital city allowance claims. My question yesterday…. That's based on $428,000 per year in capital city allowance. We now see that's going to increase under this budget by 50 percent. I would appreciate…. Again, to the minister, my question is…. No. I'm sorry, Mr. Chair. He has offered it as a forecast. I'll have to wait and ask him in the Legislature, I guess, in question period when the public accounts come out for '03-04 and see how much even more these ministers are billing for what they never previously were able to bill under any previous government.
Mr. Chair, I want to go now to…. This arises out of question period today. I want to look at the lobbyist registration website, please. The minister has said that he never met with Mr. Bornman. I'm sure every single lobbyist in the province is now saying, "Oh God, I hope she doesn't explore this any further," because of course, lobbyists bill on the basis of their connections, on their access, their ability to get access to government.
I never understood why lobbyists were necessary at all. I didn't meet with lobbyists when I was a minister. Oh, I'm sorry — I did once. Yes, I did once. In fact, it was for the car dealers. I think he was a lobbyist. He was also a car dealer. Anyway, once.
Somebody's billing clients a lot of money for their lobbying activities. The one example I asked the minister about today, Erik Bornman — he said he hadn't met with him. Let's see in what other areas Mr. Bornman claims he was going to meet with and billed his client for access…. Mr. Bornman is down as saying that he met with the minister.
The Chair: Member, can I ask how this has got anything to do with vote 22 in the finances?
J. MacPhail: Yes, sorry. It's going to be about this minister, Mr. Chair.
The Certified General Accountants Association was a client of Mr. Bornman, and he claims there were two people he was going to lobby. This minister was one.
Hon. G. Collins: As I said, I've never met with Mr. Bornman, certainly since we were elected. I'm trying to think. Actually I met with him once — not a meeting. I got off the Helijet after arriving in Victoria, and I think Brian Kieran, Erik Bornman and somebody else were there. There were no cabs, and they offered me a ride to the Legislature. At no time on that trip did we discuss any matters of business, certainly not with regard to B.C. Rail or anything else. I think we were talking hockey, actually.
I probably met with CGAs. In fact I can almost guarantee…. Well, I can't guarantee, but I'm pretty sure I have over the last year. I know I spoke to their body, I think a year and a bit ago. Certainly, from time to time they come in to see me. Certainly, I would probably have had contact with the CGAs, but as I said in the House, I have not had a meeting with Erik Bornman on any business matters at all since I was appointed Minister of Finance.
J. MacPhail: Well, let's see if other Liberals are doing the same thing as Mr. Bornman is doing in terms of their clients — claiming who they have access to. Clark Roberts is a lobbyist for the Canadian Association of Income Funds. He's a good Liberal and claimed that he was going to lobby the Minister of Finance. Did he lobby you?
Hon. G. Collins: Yes, he came to see me on behalf of his clients. I met with his clients as well.
J. MacPhail: Bruce Young — he's also a good Liberal. Bruce Young claimed he met or is meeting with the Minister of Finance on Connect Logistics.
Hon. G. Collins: I have not had a business meeting with Mr. Young on any matter, and I'm not familiar with Connect Logistics.
J. MacPhail: Erik Bornman claimed he is lobbying the Minister of Finance on behalf of Cap Gemini Ernst and Young. In fact, it was either the Premier or the Minister of Finance that Mr. Bornman was dealing with on that file. If it's not the Minister of Finance…. Was it the Minister of Finance on that?
Hon. G. Collins: I may well have met with Cap Gemini. In fact, as I think back, I may well have. I think
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they're a firm that's well known. But certainly, as I said earlier, I've not met with Erik Bornman on any matter. The name of the company or the organization the member mentioned in her previous question was Connect Logistics. I said I hadn't met with them. I don't recall meeting with them, and I couldn't tell you who they are or what they do. It doesn't mean I wouldn't have met with them at some point in the last couple of years.
J. MacPhail: Marcia Smith claims to have lobbied the Minister of Finance for AMAC. Did she get a meeting with the minister?
Hon. G. Collins: I don't recall if I ever talked to Marcia Smith about AMAC. I know I've met with AMAC in the past. I don't recall when, whether that was prior to the election or since the election. It wouldn't surprise me if I had, but I don't recall meeting with Marcia Smith on behalf of AMAC. That could have happened. I just don't recall it.
J. MacPhail: Mr. Chair, I find it fascinating. Actually, this says more about the lobbying community for their government connections. Is that what you have to do to get a meeting with the minister — you have to register with a lobbying firm and charge big bucks? I happen to know what some of these fees are that the lobbyists are charging. They're charging for access, and clearly they're not getting access — which I don't deny.
I don't deny that the minister is telling the truth. I assume he is telling the truth. Except it is interesting that all these people are making big bucks off the grind of politics in this government and it's simply, according to the Minister of Finance, to get a meeting that they don't attend — that I don't know why they can't do directly.
Let me ask the minister. Pilothouse, Brian Kieran's firm, is registered as a lobbyist for this minister in particular. Has he ever met with anyone at Pilothouse?
Hon. G. Collins: First of all, if the member has a concern with how the industry works, she should take it up with the industry, not me.
J. MacPhail: I'm about to.
Hon. G. Collins: Yeah. People can come and ask for meetings with me anytime they want. They don't need to go through anybody. In fact, I get requests frequently, and I try and meet with as many people as I can, either here or in my constituency office or around the province, if I'm out. I generally try and keep a pretty open door. It's always a matter of scheduling time, an appropriate time for it, but there has to be a pretty compelling reason why I wouldn't meet with somebody. It's generally a scheduling issue. I try and meet with any constituent or otherwise, a citizen of British Columbia, a person trying to invest here or create jobs in British Columbia. I'm glad to meet with them and hear what they have to say. I go out of my way to try and make that happen.
That doesn't necessarily mean that somebody who registers under the act is going to meet with me directly. They may say to their client, you know: "Here's what we think. You would like to see this happen. Here are the people in government you should probably tell your story to. Here's what I think your story should be, how it works with what government's goals are — how it meshes, where you clash, how you manage those things." I'm assuming they give advice to people on how they want to deal with government. I've never been in that profession, but that's what I've always understood.
People probably do that, and they would be listed, I'm assuming. I probably don't have a great deal more knowledge about the act and its application than the member opposite does, but I do know that people register their intent to lobby. Now, they may not. They may find they don't need to lobby directly. They may advise clients, and perhaps as an abundance of caution, they register. I don't know that. All I can tell the member is who I recall meeting with and, if so, what it was about.
Now, in response to her specific question, Pilothouse I think is the same company she talked about earlier that Erik Bornman was part of. My understanding is that was the same. Brian Kieran was one partner and Erik Bornman was the other. To answer her question, I don't recall ever meeting with Brian Kieran on an issue either.
J. MacPhail: Oh, I understand this is as much about the lobbying firms that grease the skids of government, particularly the Liberal Party — sorry, not the skids….
Point of Order
Hon. G. Collins: Point of order, Mr. Chairman. Those are pretty severe accusations the member makes, and I think she should be very careful about making them.
J. MacPhail: What point of order is that?
Hon. G. Collins: Well, it's unparliamentary.
J. MacPhail: No, it isn't.
Hon. G. Collins: It is, Mr. Chairman, and I think if you check the record….
J. MacPhail: Tell me what part is unparliamentary.
The Chair: Would the member mind going through the Chair? The minister is going through the Chair, and the member will wait to go through the Chair.
Hon. G. Collins: The member's comments are out of line when she talks of greasing the skids of the party or otherwise. That is a pretty serious allegation, and she should be careful about it.
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The Chair: If the member wouldn't mind being very careful about her parliamentary language, it would help the Chair.
J. MacPhail: Absolutely, Mr. Chair. I'm well aware of my parliamentary language. Just because he doesn't like the accusation, doesn't make it unparliamentary, I would say.
These are big donors to the Liberal Party. That's public information. Somehow this government likes to distinguish itself…. I mean, what a day for the Minister of Finance to stand up and claim himself to be pure and say that others should watch out — a pretty rotten day for him to try to make that challenge.
Robin Adair lists, again, the Minister of Finance as the only person he's lobbying on behalf of WCG International. Did that occur?
Hon. G. Collins: I don't recall what WCG is. I may well have, a year or two ago, met with Robin Adair, although I can't be sure about an issue. I think he used to be part of a group, Job Wave or something like that, if I recall correctly. I think he was working on their behalf. I'm not sure about that. We may well have had a meeting about that issue, if that's what it was. I'm trying to remember.
J. MacPhail: Does the minister's political staff keep records of their meetings?
Hon. G. Collins: I have no idea.
J. MacPhail: Well, how is it, then, that yesterday — and the minister used this to avoid answering in question period today — the minister was so sure that Dave Basi never had meetings with any of these people on B.C. Rail? How is that he's so sure of that if he has no idea who his staff are meeting are with?
Hon. G. Collins: I described for the member what David Basi's role was. She's made all sorts of inferences based on that, most of which — probably all of which, if not most — are not valid. Those are her conclusions. She can reach them, but she shouldn't put words in my mouth.
J. MacPhail: I'm not. I asked a question. If the minister says he…. Let's just see what this little network does. Lobbyists charge clients big bucks, thousands of dollars per month, to retain clients to lobby government. They list who they're going to lobby in government.
The minister says Erik Bornman never met with him. Erik Bornman doesn't list anybody else in government yet, although I understand he's been fired. He doesn't list anybody else. We can assume Mr. Bornman is not delivering what he promised, or he's not being clean with his clients. We can assume that, or Mr. Bornman met with somebody else in the minister's office on the B.C. Rail file. We can assume that too. It's one or the other, because Mr. Bornman has acknowledged that he was on the B.C. Rail file. The minister outed him yesterday in question period himself.
If we know that Mr. Bornman was working on the B.C. Rail file, because the Minister of Finance said so yesterday…. He's claiming he lobbied the Minister of Finance. The Minister of Finance says no, perhaps it could be his staff. Yet the minister hasn't got any idea whether his staff keep track of their meetings or not — none whatsoever.
On what basis is it that the Minister of Finance can assert he knows for sure nothing went on between Dave Basi and Erik Bornman?
Hon. G. Collins: I've never made that assertion. I've described to the member Mr. Basi's role as I know it and as I assigned it to him. Those are the questions she's asked from me. I have no knowledge of whether or not he met with Erik Bornman. I wouldn't know that. It wasn't something I was told. The investigators may know that. I don't. She's asked me questions; I've answered them. She takes this web and weaves it into something and then draws all sorts of conclusions.
Just because somebody registers under the act — the Lobbyists Registration Act — their intent to lobby somebody doesn't mean they actually end up doing that. They may find they don't need to; they may find they don't want to. They may find their client pulls away and don't want to achieve what it was they originally set out to. The Lobbyists Registration Act, which I might add was something this government brought in…. The same sort of procedures around the role of lobbyists existed under the previous government, except it was closed to anybody. There was no knowledge of that. You couldn't find any records of it.
We brought in, as part of our election campaign, a Lobbyists Registration Act. That's what the member has as information. It's far more transparent than what was there before. I don't ever once recall that member standing up in the House in the ten years we spent on opposite sides of the chamber raising the issue of lobbyist registration or any of those issues. I'm surprised by her new-found innocence in all of this.
The reality is that there is information there for the member. Just because somebody registers their intent to lobby somebody doesn't mean a meeting takes place. You can't assume that. All of the assumptions the member puts out before this House don't have a leg to stand on. She can't make that assertion. She has no proof of that. She's coming to wild speculations in order to move this along.
Now, I might ask the member if she wants to keep doing this. I'm prepared. That's part of my job. At some point we'll run out of relevant questions, and that will be up to the Chair to determine. There are lots of staff here from the Ministry of Finance who are very busy and are very skilled. That's fine with me if she wants to ask these questions. If she wants to do this, I'd like to send them away so they can do their other work, be-
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cause they have other work to do. Just out of courtesy to them…. She doesn't have to, but if she wants to give me some indication, then we can continue to do this, and they can go about their jobs. Otherwise, I'm perfectly prepared to have them wait here.
J. MacPhail: The first time we debated legislation, this minister didn't want to answer my questions. He was quite insulting throughout the debate. Now he wants to know how quickly he can get through his estimates. Today I asked him how late we were sitting. He can't even answer that question. It's unbelievable, and now he's worried about his little role in the job. Honestly, Mr. Chair, we're at the second day of debate on estimates, and he is already getting frustrated.
The Minister of Finance said during the raids…. Just after the raids on the Legislature, when he flew home from Hawaii and then flew back, he said this has nothing to do with government — absolutely nothing. Today his story has shifted quite a bit. That's moved on today. He's admitting today he has no idea whether it has anything to do with government, so that's a different story — completely.
On the basis of giving the severance to Mr. Basi…. I assume that the severance was given to Mr. Basi on a discussion that there was cause or no cause and that whether there be cause or no cause must have been discussed with the Minister of Finance.
Hon. G. Collins: As I said yesterday, I was not involved in that decision. It was done through the Public Service Agency and Mr. Brown, whose role it is and to whom Mr. Basi reported.
J. MacPhail: Is it the minister's knowledge…? He's the head of…. I think the Public Service Agency reports to the minister. Does it? PSEC reports to the minister, and he's responsible for administration of severance. Sorry — is the minister not? The guidelines?
Hon. G. Collins: PSEC policy, as government put under Bill 66, is on the public record. As I said with regard to Mr. Basi, I was not consulted with regard to his severance.
J. MacPhail: Is the Minister of Finance responsible for PSEC policy regarding severance?
Hon. G. Collins: As I've said, government's policy on severance was put before the House in Bill 66. The general policy around severance in government is something that is set by government as well as by the Legislature, as the member's aware.
J. MacPhail: Is it the minister's view that severance can be paid with cause?
Hon. G. Collins: I'm advised that there is no severance payable if somebody is let go with cause.
J. MacPhail: So we can assume that Martyn Brown has some information, that he made a decision to give Mr. Basi severance because…. We're not sure why. When the Minister of Finance's staff person got severance, was it reported to PSEC? Was PSEC consulted on whether Mr. Basi should be given severance on the basis of cause or no cause?
Hon. G. Collins: The Public Service Agency made that decision within the policy that's set by government. That's their role. They base it on the years of experience, etc. Although I wasn't part of the decision, I expect the reason Mr. Basi received severance was that he wasn't fired for cause because we didn't have a particular cause that was his fault. There was an investigation underway, and as I've said in this House and publicly numerous times, we felt Mr. Basi couldn't continue to do his job while that investigation was underway.
We have had no…. There is nothing that's been proven that Mr. Basi has done anything wrong. There are allegations in a summary of a search warrant. There has been lots of public speculation, but contrary to the comments of the member in the House yesterday, which she didn't withdraw, there have been no charges laid. Mr. Basi — there would be no cause to fire him, so he was let go, I assume, without cause. Therefore, severance was payable. But it was clear for the reasons I've stated over and over again that he couldn't continue in that position.
J. MacPhail: Mr. Brown consulted with the Public Service Agency. Is that correct?
Hon. G. Collins: I've said that about four times.
J. MacPhail: I'm sorry, Mr. Chair. After the last cabinet shuffle, who does the Public Service Agency report to?
Hon. G. Collins: Management Services.
J. MacPhail: Would the minister suggest that it was also the Public Service Agency…? I'm just looking for direction on who to ask these questions to. Would it be the Minister of Management Services' Public Service Agency that would make the decision to keep Bob Virk on salary even now?
Hon. G. Collins: I answered that at least 40 times. It was Mr. Brown.
J. MacPhail: I don't know what the minister is so frustrated about, about having to answer questions over and over again. He might want to look to his own record when he was in opposition. I know he's tried to deny all those years when he set all those high standards for governments that he now refuses to live up to, at any turn, including his own ministerial responsibility. I fully understand that he wants to avoid all of that diatribe he inflicted on previous people when he
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was in opposition. But oh my God, forget that he might have to answer questions now.
Is the minister stating, then, that the lobbyists that are in this…? Let me just reach a conclusion and ask the minister for his comment on it. The lobbyist activities that are listed here under the currents ones…. They're the most current ones as of today. When his name is mentioned here and he, the minister, says he has not met with that person, then no meeting took place, either with him or his staff?
Hon. G. Collins: My understanding of the way the act works is that it would be my name that's on there. I can only tell the member of those meetings that I recall taking place and those, to the best of my ability, that I recall not taking place or that no meeting did take place. I can provide that to the member. I can't draw assumptions on anything above and beyond that, because I can only tell the member what I know.
J. MacPhail: What made the minister reach the conclusion, then, that the raids on the Legislature had nothing to do with government?
Hon. G. Collins: I don't recall ever saying that, in those words. What I have said repeatedly, as have the investigators as late as yesterday in the summary, is that there was no elected official, no member of cabinet or caucus, who was subject to this investigation.
J. MacPhail: Certainly the Premier said yesterday that it had nothing to do with government, that it was a personal matter. I'm happy to do the research. I'm happy to get — we can do that in question period tomorrow — to where the minister said this has nothing to do with government. In fact, the minister assured reporters, when asked, that it had nothing to do with the B.C. Rail deal. So it's interesting that he's shifting his story today.
What's the status of the completion of the B.C. Rail deal?
Hon. G. Collins: I have said probably at least 20 times over the last couple of months, maybe twice that many times, and a number of times in the House what Mr. Basi's role was. He did have a role with B.C. Rail. His job was to liaise with the members of caucus. His job was to deal with the media in the corridors. His job was to deal with elected officials along the route. I said that, standing in exactly this same position, probably 24 hours ago almost right now. I'm not sure where the member's revelation is coming from. I said that on the day I got back from my vacation. I've said it repeatedly since then. There's been no change. It's the same comments I've been making all along, because it's the truth.
For the status of B.C. Rail she should ask the Minister of Transportation.
J. MacPhail: Well, it's this minister that made the decision to book an indemnity of $255 million. What's the status of that?
Hon. G. Collins: The same status it had yesterday when we talked about it. It's in the books.
J. MacPhail: We didn't discuss the status of it; we discussed the booking of it. Is the minister saying he has no involvement in the completion of the B.C. Rail deal, including dealing with the competition bureau?
Hon. G. Collins: I've had no discussions with the competition bureau. The member asked the question of what the status of the booking of the amount was — the indemnity. She can check Hansard. I'm answering her question. She asked me what the status of the indemnity was, and the status hasn't changed.
J. MacPhail: If the minister knows the status hasn't changed, then he must know something about the completion of the deal, because it's part of the deal. That's fine. Is the minister saying he has nothing to do with the completion of the B.C. Rail deal?
Hon. G. Collins: As I said yesterday, I have a role to play, and that is with the financial part of it. I will deal with the indemnity. I will deal with any legislation, in helping to draft legislation, to implement this when it comes along. Officials in my ministry would. Arn van Iersel, who's the comptroller general, who was here yesterday, would have a role in that. Probably the deputy minister would. There are trusts that need to be set up.
I expect there's lots of involvement with the Ministry of Finance in the implementation and preparation of that transaction, but I personally am not out there dealing with the competition bureau. I'm not dealing directly with CN or B.C. Rail for that matter. The Ministry of Finance is facilitating the progression of what may end up being a transaction that, at the end of the day — it's been signed off — once it's implemented, will provide lots of opportunities for British Columbians. The role of the Ministry of Finance is to help facilitate that.
J. MacPhail: Well, perhaps he could facilitate the public information now by giving the time line of the completion of the deal.
Hon. G. Collins: I think on budget day I talked about it. I think it's actually in the budget reports, where the member could have seen it in the topic box on B.C. Rail. The government forecast is that it would complete by March 31. That is what the forecast was at the time the budget was put together. If the competition bureau takes longer than that, then it could happen in April or some other time, but the plan was and the forecast was that it would be complete by March 31. If it doesn't complete by March 31, then the entire transaction, both the pluses and minuses, moves into the 2004-05 fiscal year. In either year it's bottom-line neutral to the budget. That's all contained in the budget documents.
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J. MacPhail: What the minister I'm sure realizes is that part of this discussion is for people who don't have time to read the topic box. I read the topic box, yes, and it said that their forecast is for March 31.
How are we coming along on the forecast of the deal to be completed by March 31?
Hon. G. Collins: Pending a decision from the competition bureau, it will happen before or after March 31. I don't know when their decision will come down.
J. MacPhail: What meetings have happened or submissions have occurred from the competition bureau, and what's the word from the competition bureau on when it will be completed?
Hon. G. Collins: As I said, I haven't made any submissions to the competition bureau. I'm assuming lots of people have. I'm assuming B.C. Rail has. I would assume the proponent has. I assume others have. Shippers have. I'm not familiar with the competition bureau process. Those questions would probably be better put to the Minister of Transportation, who is the lead in driving this issue through government, through the competition bureau, etc. We are attached to it tangentially in trying to provide services around the accounting, around the setting up of trusts, etc., to move this forward. I'm just not aware of how that process works. It's not an area of my responsibility. It would be an area of responsibility for the Minister of Transportation.
J. MacPhail: It's a billion-dollar item, and the minister is taking such a hands-off approach to it? Interesting.
Who in the Ministry of Finance is helping the Ministry of Transportation with the competition bureau?
Hon. G. Collins: I answered that yesterday. I answered it about three and a half minutes ago — the comptroller general, who was here yesterday; the deputy minister; and, I assume, other officials in Treasury Board who would be required to do that.
J. MacPhail: I'm not sure why the minister is wanting to take such a hands-off approach to it. He was front and centre in claiming what a great thing this was for the budget. It would be a pretty big hole in their little political platform if the competition bureau doesn't allow this to proceed. I would assume any good Finance minister worth his weight in salt would be concerned about this.
Is the comptroller general making direct submissions to the competition bureau?
Hon. G. Collins: Not to my knowledge. As I said, that's not our role. The Minister of Transportation's role would be to guide this project through. The Ministry of Finance's role is to facilitate in the ways I've described.
J. MacPhail: After receiving the summary of the warrants yesterday, has the minister changed his position about the relationship between the raids and the business of government?
Hon. G. Collins: I answered that question earlier.
J. MacPhail: I'm quoting from the paper today — the Jeff Rud article in the Times Colonist:
"Outside the Legislature Collins said: 'It looks to me as though the investigation that's taking place relates to Mr. Basi and Mr. Virk and their role in government and Mr. Bornman, who became public comment in the media…. It appears that's where the police are looking'" — I'm just quoting directly — "'is some sort of relationship between those two individuals and Mr. Bornman, who was representing Omnitrax. I can only infer from what I see and what I've been told.'"
Is that different than what the minister would have said the day he returned from Hawaii after the raids on the Legislature?
Hon. G. Collins: Obviously, that day I wouldn't have seen the summary, so I wouldn't have made the same comment.
J. MacPhail: The departure of Mr. Basi has led to what changes in the minister's office from a technical point of view, from a sort of document point of view, a tracking point of view, a ministerial responsibility point of view, a tracking-of-meetings point of view?
Hon. G. Collins: Well, nothing. The office continues to operate. We have people who have taken an oath. They do their jobs; I do my job. There's an investigation underway. It may lead to something; it may not lead to something. The member could read that in the summary as well.
J. MacPhail: So the minister has made not one change in the procedures in his office since the firing of Mr. Basi — not one?
Hon. G. Collins: I described, I think at length, yesterday the roles of each person in the office. I also explained at length yesterday the role that Mr. Penner is playing as parliamentary secretary to replace the duties of Mr. Basi. I think I've answered that.
J. MacPhail: Mr. Chair, all sorts of responsible people in government who have integrity, which is what this government promised, would take these kinds of troubling situations, allegations or not, and learn from them whether they be true or not — some indication of restoring public confidence. I'm asking the minister what changes he has taken in terms of his relationship with how meetings are recorded, responsibilities for what, dealing with staff and outside lobbyists. Has the minister made any changes in those areas?
Hon. G. Collins: There is an investigation underway. There have been no findings of that investigation. There have been some allegations — some very vague
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allegations — made. I don't know what changes she would expect.
Members of the public sector take an oath. They're expected to behave accordingly and with professionalism. I assume they do that. I'm not going to police every single person who works in my office and have them report to each other on who they talk to on the phone, who calls them, who comes to see them, which member of the Legislature comes to see them.
My schedule is subject to FOI. I know that because the member has requested it, and she's more than happy to have it.
I think I've answered that.
J. MacPhail: Did the minister have conversation with Robert Pauliszyn about changes in procedure after the departure of Mr. Basi in terms of office procedure, computer files, tracking of information, meeting with lobbyists?
Hon. G. Collins: Until yesterday, when the summary was released, there was lots of speculation in the media about what this might be about. There was no indication of what it could be about. I saw the summary yesterday. Since then, I've been in estimates with that member opposite, and I continue to be estimates or in cabinet with that member. I have not had a chance to determine whether or not there are any procedures that need to be changed. All we know from the summary is that there was an allegation or a comment made by the investigators in order to obtain a warrant. They made that. I read it yesterday, probably after the member opposite read it.
J. MacPhail: Oh well — sorry. That's not what Andy Orr told all the government to say, and it's not what the Premier said. Andy Orr was out in the hallways doing his job as deputy minister responsible for the public affairs bureau, telling all who would listen: "We knew everything that was in there. There's nothing new. Calm down." In fact, the Premier is quoted saying that. Here's what the Premier is quoted as saying: "There frankly is not very much in that report that hasn't already been reported by the media in the past or speculated by the media in the past." There's nothing new there, and yet it caused a lot of consternation.
The Premier said: "Nothing new; don't get anxious." Yet on the basis of even the speculation, the minister is saying he didn't change anything in his office. Did Martyn Brown call a meeting of political staff on this matter that the minister is aware of?
Hon. G. Collins: I don't know. Ask him.
J. MacPhail: Well, I'll have to ask the Premier. Once again, we're lifting up on this.
It was in this minister's office that the raid occurred. It was his staff person that was fired, and somehow there has been no discussion between Mr. Brown and this minister about any of this. That gives a lot of confidence to the public, doesn't it? Yesterday, in order to get out from a very tough situation, this minister, the Premier and Andy Orr were saying: "Oh, there's nothing new here." Yet, when I asked the minister what changes he's made, if any, he said: "None, because we didn't know what the summary was going to say." The minister can't have it both ways.
Have there been any directives issued to cabinet ministers as a result of the raid on the Legislature?
Hon. G. Collins: The member goes on at length about speculation — speculation in the media, lots of speculation by the member opposite. I'm not conducting an inquiry in my office. I've said that previously. There is an investigation ongoing. Let the investigators do their investigation. I'm not going to interfere in that. I'm not going to do an internal investigation. I'm not going to go out there and hunt people down.
You know, some of the questions that have been asked by media in the last couple of months have, quite frankly, been pretty offensive. I was asked at one point if I knew of any other relatives of Mr. Basi who were still working in government. What does that imply? Does that imply we're supposed to go through the government directory, check all the Indo-Canadian names and find if there's somebody related to David Basi, then go and ask them if they're related and then go fire them? I mean, I don't know what the member is getting at.
The reality is there has been tons of speculation — all sorts of speculation over the last…. The media have been commenting about all the speculation and then going on and speculating more. The member opposite has speculated more than anybody. I'm not going to go out there and start doing an internal investigation based on speculation.
There is an investigation that's happening. They're going to pursue that, and they will come to their conclusions. Either there will be nothing there or there will be something there. That's their job. I don't know what the member intends here. Nothing has changed. Yesterday the information that came out was the first time we had seen it in a summary, but it is not new information. It was speculated upon for the last two months.
J. MacPhail: Let me follow the logic of the Minister of Finance. He hasn't made any changes in his office because there's an ongoing investigation. I would assume he's saying that there's an ongoing investigation into his office. Yet, at the same time, he and his Premier say, "Oh, this is personal. It's got nothing to do with government," although the minister did just change his story on that.
If indeed the investigation is the reason why this minister is not changing anything in his office, does the investigation have to do with his office or not?
Hon. G. Collins: I see no need to change anything in the office. I said that earlier. Perhaps she forgets that. She has selective hearing. I said there is no need to.
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They're our professional civil servants. They take oaths. They're expected to behave professionally. I assume they're behaving professionally. I am not going to have somebody monitor and police the people in my office. I'm not going to do that. I have no reason to believe it's a problem with any of them, and I'm not about to go in and set up some big structure in order to make the member opposite happy.
The fact of the matter is that there is an investigation into two individuals who worked in government, Mr. Basi and Mr. Virk, and investigations into people outside government. People are aware of that. The summary yesterday, I think, confirmed a bit of that speculation. That's fact. The message hasn't changed; the story hasn't changed. It's exactly the same. The member can try and take that and turn it into something it isn't — she's been doing it now for the last hour at least, if not the last two months — but the facts are the facts. The member can do with them what she wants, but I think people know what the facts are.
The Chair: The Leader of the Opposition on new questions?
J. MacPhail: Sorry?
The Chair: I'd ask the Leader of the Opposition…. This has been canvassed fairly thoroughly on his office. Has the member got a new question?
J. MacPhail: Boy, I don't know what this government would do if there were more than two in opposition. I mean that seriously. It's unbelievable how this government likes to clamp down on any challenge to it whatsoever.
Mr. Basi was fired. It wasn't anybody else's office. It was this minister's office which was raided. He now stands up and says he's taken no action whatsoever because the facts speak for themselves. Well, the facts in the summary don't give any comfort on that. It's about proceeds of crime and corruption. We haven't even heard about those search warrants on the proceeds of crime and corruption yet, but they're there in the summary. The second investigation is about breach of trust. The minister hasn't taken one iota of action to ensure that his office — other than blind faith that everything is fine…?
Let me ask this, then. On the proceeds of crime and corruption investigation, has the minister taken any action inside his office?
Hon. G. Collins: Again, the member has her facts wrong and is stretching the facts or re-creating facts. The reality is that the offices that were searched were the office of Mr. Basi — restricted to the office of Mr. Basi; it was very clear, and the police, the investigators, made that very clear on the day they did it — and the office of Mr. Virk. It was not a search of my office; it was not a search of Robert Pauliszyn's office. It was not a search of Adam Buchanan or Yvette or Melanie or anybody in my office. Their offices were not. It was the office of Mr. Basi. Those are the facts.
I've said many times this afternoon that I am not about to engage in an investigation in my ministry. I've said that for two months. It's not appropriate. Let the investigators do the investigation. It's their job. Me interfering with that…. If I had, this member would be standing on her feet crying blue bloody murder over that. I'm doing what is appropriate. I'm letting the investigators do their job.
J. MacPhail: My questions have nothing to do with interfering in the investigation. They have to do with whether this government has taken any action as a result of the raids. I find it very interesting. This is a government that now likes to limit its scope of responsibility, its sphere of influence. The Minister of Finance says: "Oh, Dave Basi's office has nothing to do with me." Isn't that interesting. I guess Dave Basi has some sort of his own sphere of influence. Yesterday the government said the fact that this has to do with the allegations around the B.C. Rail deal has nothing to do with government. My God, who is in charge?
We have a situation here where confidence in this province is at risk, a national story, and this minister feels like he wants to step back and limit his sphere of influence so that Mr. Basi's office had nothing to do with him.
Did the minister have any discussions, following the police raids, with the former Minister of Transportation re the firing of staff?
Hon. G. Collins: The answer to your question is no. The answer to her rant is that the facts speak for themselves. I've not said half of the words the member puts in my mouth. What I've stated is the fact. The fact, as stated by the police on the day the warrant was executed, was as follows, and I paraphrase: that the offices of Mr. Basi were searched, that the office of Mr. Virk was searched, that the search did not extend beyond those, that neither….
J. MacPhail: Yes, it did — the computer systems.
Hon. G. Collins: Well, I don't think that was a public statement by the police at that time, and I'm trying to paraphrase the statement they made at that time. The member may have been able to see with her crystal ball something different, but at that time that's what we all knew.
J. MacPhail: The government knew about it.
The Chair: Will the member please go through the Chair and wait for the minister to finish?
Hon. G. Collins: I've stated the facts. She may not like the facts. She may try and create the facts and turn them into something else. She may try and paint over the facts. She may try and stretch the facts. The facts
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are clear, and I've stated them for her. How she chooses to abuse those facts is up to her.
J. MacPhail: What are the facts that the minister is referring to — what was listed in the summary? What facts?
Hon. G. Collins: I just paraphrased it for the member.
J. MacPhail: No, sorry. My question was: what are the facts? That's his interpretation of events. The facts that the minister likes to call facts — are they in the summary of the warrants?
Hon. G. Collins: The day the warrants were executed, the police made it clear that the two offices that were searched were the office of Mr. Basi and the office of Mr. Virk. They made it clear that the rest of the precinct was left intact. They only had permission to search those two offices. That was talked about in the media. I only know what I heard in the media, and that's all I knew at the time.
I can corroborate — as I've said and as I showed the media when they came back and wanted to see — that the office of Mr. Basi was empty. The rest of the offices of the people who work in that area were as they were previously. That's the fact. The member may like that or she may not, but those are the facts.
J. MacPhail: Well, I think it's even more troubling — the fact that Mr. Basi had his own sphere separate and apart from this minister in the Ministry of Finance. It's really shocking how…. Who else is given this sphere of influence in this government?
What role did CIBC World Markets play in the sale of B.C. Rail?
Hon. G. Collins: Again, I'm not the minister responsible, but they were, to the best of my knowledge, providing financial advice to Mr. Trumpy's team of advisers.
J. MacPhail: Well, in fact, the minister commented publicly on the role of CIBC World Markets when it was revealed that they made a presentation that CN would be…. I remember it as the best choice, but they clearly indicated that CN was the best choice, and it was this minister that commented on that. Can the minister remember what his comments were?
Hon. G. Collins: Yes, I think it was my first quarterly report last year in September — September 10 or 12 or something like that. My comment was that it was highly inappropriate — they were to be providing advice to the review committee, not the general public — and that we would be taking that up with them. Actually, I said I thought somebody already had taken it up with them. My understanding is that they were told that it was an inappropriate comment — that the process was not complete and that their role was to provide advice to the review team set up and led by Mr. Trumpy, not to the public.
J. MacPhail: Was it Mr. Basi that brought that to your attention about CIBC World Markets favouring CN?
Hon. G. Collins: I think it was commented on in the media, if I'm correct. I don't remember where it came from. I just remember it was public. I was asked that at the quarterly report.
J. MacPhail: Did Mr. Basi discuss that with you before your public response?
Hon. G. Collins: I don't recall, but I don't believe so.
J. MacPhail: That's interesting, very interesting. Well, there'll be more to come out on that.
Why wasn't the…?
J. MacPhail: Well, there will…. This minister claiming complete innocence around any of this is really a bit too much to bear, Mr. Chair. Completely too much to bear.
The Chair: The Leader of the Opposition has the floor.
J. MacPhail: His unbelievable lack of ministerial responsibility…. I mean, the only conclusion you have to reach is that he didn't have a clue what was going on inside his own ministry. Why was Partnerships B.C. not involved? Or were they involved in the B.C. Rail deal? Did people like Ms. Sanatani meet on B.C. Rail or…?
Hon. G. Collins: No, not to my knowledge. Partnerships B.C. was not involved. This was a particular transaction that would stand on its own. We had the appropriate people in place to deal with it, a team led by Mr. Trumpy. There were others. There were independent legal advisers as well as independent business advisers.
Mr. Chairman, I just might comment…. Throughout the debate today and yesterday, the member has made veiled allegations or references to other information that is going to come out and then has one of those neat little smiles on her face. If she has information that would assist the investigation, she should forward it. If she has information that is part of the investigation, it would be interesting to know how she obtained that.
J. MacPhail: Oh, thank you for the ethical advice about integrity. Thanks very much. Coming from this
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minister, that really means a lot. Both his personal record and his government's record….
When does it get decided about whether Partnerships B.C. is part of a privatization effort?
Hon. G. Collins: The way it works…. We went through this last year in estimates, but I'm glad to go through it again, because this was a year ago. Generally what happens is that a ministry has a project or something they want to proceed with, although a proposal could come from outside government. It might be something somebody in Partnerships B.C. identified. Certainly, anywhere in the public sector if there was a proposal, it would either originate in a ministry or an agency or be taken to the ministry or agency to see if it fit with their service plan, their business plan.
If it was something they thought was interesting and worthwhile proceeding with, then Partnerships B.C. would help to facilitate in the analysis of that to determine whether or not it might be a partnership arrangement that they could help to facilitate or that would be in the best interests of government, of the people of British Columbia. Partnerships B.C. would need to take that to their board.
The ministry or agency would have to be the champion for it. They would be the lead on it. Partnerships B.C. would have to go to their board and convince them that there was actually a potential partnership here and that there was a business arrangement and a service Partnerships B.C. could provide to the proponent.
J. MacPhail: What prevented B.C. Rail from qualifying for that? It's called an investment partnership. What happened there?
Hon. G. Collins: My understanding, although I'm glad to take advice if anybody has any, is that this is a large stand-alone transaction. It was pretty clear what needed to be done. While it's complicated, there was a project team headed up by Mr. Trumpy, who is imminently qualified and of great reputation in the public sector. He put together a team that worked with him, people from various ministries who might be able to assist and help out in that. They also accessed the expertise at B.C. Rail itself, as well as contractors to provide other professional advice, whether it be legal advice or business advice, etc. That was the appropriate structure to use in this case, and I think it proved to be correct.
J. MacPhail: Is Partnerships B.C. playing any role in the completion of the spur line sale to Roberts Bank?
Hon. G. Collins: No, it's the same team.
J. MacPhail: The exact same team that's doing the B.C. Rail deal?
Hon. G. Collins: A question better put to the Minister of Transportation, but to my knowledge, that's correct.
J. MacPhail: Well, it's so hard to know who's in charge of privatization in this government. We have a whole operation called Partnerships B.C., and there are all sorts of privatization initiatives that aren't included under that.
If I want to ask Mr. Trumpy questions about this B.C. Rail deal…. He reports directly to the Minister of Transportation?
Hon. G. Collins: On this file, that's my understanding.
J. MacPhail: When was the last time the minister met with Mr. Trumpy on the B.C. Rail deal?
Hon. G. Collins: I don't recall the last time I met with him. I will talk to him from time to time. If he has a question or an issue he wants to bring to my attention, that's up to him.
J. MacPhail: Is the minister still chair of Treasury Board? Does the Minister of Finance still do that?
Hon. G. Collins: Yes, last time I checked.
J. MacPhail: When was the last time the B.C. Rail deal, either the spur line to Roberts Bank or the completion of the sale of the rail line in the north, was brought to Treasury Board?
Hon. G. Collins: I'm trying to recall if and when that would have happened. B.C. Rail was, as I mentioned, a stand-alone transaction that was being led by Mr. Trumpy — and, obviously, led through the Ministry of Transportation. There were analysts, and expertise was sought from both the public and private sectors as part of that. All those issues were presented to the review committee, which was specifically designed to deal with this transaction, and then went to cabinet.
The people and analysts who would have analyzed this as it came through Treasury Board would have been similar people who worked on the file. The comptroller general would obviously have been consulted. The Deputy Minister of Finance would have been involved and any other people within the ministry or Treasury Board staff that the team thought was appropriate.
J. MacPhail: I didn't hear even a month. Can the minister consult with anybody to find out?
Hon. G. Collins: I did consult, first of all. As I said, I don't recall it coming specifically to Treasury Board as such. There was a committee or a team that was putting it together under the leadership of Mr. Trumpy and the Minister of Transportation. There were analysts that were pulled from across government and the Crown, as well as the private sector, to do the analysis of this transaction. It went to a review committee, which I described to the member yesterday. Then the entire cabinet looked at the proposal, made a review,
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determined what they wanted to do, made a decision and moved forward with it.
J. MacPhail: I'm actually quite taken aback. Is there no Treasury Board decision minute on the B.C. Rail deal?
Hon. G. Collins: We'll try and determine that for the member. I'm not aware of one.
J. MacPhail: It didn't go to cabinet for final approval before the big frou-frou public announcement by the Premier. The cabinet meeting occurred — because I went through these Hansard debates yesterday — before CP Rail made its accusations of unfairness on the bid. The minister doesn't know if there was a Treasury Board minute. Where is the decision point on this deal, and when was it?
Hon. G. Collins: I've described the process to the best of my knowledge, as well as the role of Treasury Board and the staff that might have been in the Ministry of Finance. I know the member had that discussion with the Minister of Transportation in the fall. If she wants to pursue that discussion further, she should take it up with the Minister of Transportation in his estimates.
J. MacPhail: No, no. That's not my question. Where is the decision to spend money? Where is that decision point?
Hon. G. Collins: We're actually making a billion dollars on this transaction.
J. MacPhail: No. Oh, honestly. What a ridiculous statement for the minister to make. What an absolutely ridiculous statement. Is it on that basis that he decided not to take it to Treasury Board then — because he can't remember? Isn't it funny? A billion dollars either making or spending, and he can't remember where the decision point was.
Can we just take a pause here, and then the minister can consult with his deputy minister? Is the deputy minister still secretary to the Treasury Board?
Hon. G. Collins: I've described the process to the best of my knowledge. The member had a full discussion with the then Minister of Transportation at the time about the cabinet decision on this issue. I discussed it a bit yesterday with the member, again to the best of my knowledge. It was a decision of all of cabinet. That's the final decision-making body of government. Cabinet said: "Go do this transaction. There are these few things we want you to deal with. If you can make that happen, then make the deal." That was a decision.
J. MacPhail: Was the minister at the cabinet meeting?
Hon. G. Collins: Yes.
J. MacPhail: What action did the cabinet take on the CP Rail letter regarding the B.C. Rail sell-off?
Hon. G. Collins: The fairness commissioner has already taken all those issues into consideration and reported on them.
J. MacPhail: Oh, I can just see it, if he were in opposition. They set up their own commission to examine how well they're doing. They limit the parameters of the fairness review, and then they say: "Oh my God, that stamp of approval. We created the stamp. The size of the stamp and the ink the stamp is going to use justifies everything we did." Wow, aren't those high standards?
Is it the minister's point, then, that the fairness commissioner looked at the CP Rail letter?
Hon. G. Collins: I believe so.
J. MacPhail: Did cabinet decide that the fairness commissioner was able to deal with CP Rail's allegations?
Hon. G. Collins: No, I believe the fairness commissioner did.
J. MacPhail: Well, the fairness commissioner said that they didn't deal with the allegations and that it was not part of their review. The fairness commissioner, in its report, said: "We did not have the right to review those kinds of allegations." Did anyone else deal with them?
Hon. G. Collins: That's why the member should be asking the Minister of Transportation these questions.
J. MacPhail: If I want to know who made the decision to cut a $750 million deal with B.C. Rail, with CN…. It ain't one billion, Mr. Chair. It's $745 million, actually, and the taxpayers are on the hook for the other $255 million in indemnity — $745 million. I'm to ask the Minister of Transportation what went on at Treasury Board, what went on at cabinet. Did the Minister of Transportation sit on Treasury Board at that time?
Hon. G. Collins: It wasn't a he; it was a she. No, she didn't.
J. MacPhail: The current one.
Hon. G. Collins: The current Minister of Transportation did at the time. I don't know whether he attended all the meetings. In fact, I know he probably hasn't attended all the Treasury Board meetings. I've already described for the member, to the best of my knowledge, how this transaction took place. If she wants to pursue it further, she should take it up with the Minister of Transportation. I've also said that the
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ultimate decision-maker was cabinet. It's always cabinet.
J. MacPhail: Yeah. Well, I assert that cabinet didn't make any decision about this deal before the deal was announced — none whatsoever. I also assert that cabinet didn't deal with CP Rail's accusations and neither did the fairness commissioner.
What lessons were learned from the B.C. Rail privatization that are being applied by Partnerships B.C.?
Hon. G. Collins: I just spent a bit of time this afternoon explaining to the member why the B.C. Rail transaction was outside of Partnerships B.C. Partnerships B.C. was not involved in the transaction because it was not the type of transaction that would be good for Partnerships B.C. to be involved in.
J. MacPhail: I'm not sure what that had to do with my question.
Partnerships B.C., according to their own annual report, are about partnerships between the private and public sector. Let me just see some of the big files they've got right now. They've got the Abbotsford regional hospital. That's a $300 million project.
Let me ask this: are there any lessons to be learned from the B.C. Rail sell-off and the Abbotsford hospital?
Hon. G. Collins: The final conclusion of the B.C. Rail transaction has not occurred yet. When it does, it may well be that Mr. Trumpy and his team want to advise other people in government what they've learned. They're certainly free to do that. And if they have any valuable advice, I hope they give it.
J. MacPhail: But the minister doesn't know when the deal's going to be completed. He can't answer that for me. He has no idea what the competition bureau is doing here. He's just such a hands-off guy. I think it'll come as a real shock to British Columbians that this minister lacks such influence across government. Of course, he wouldn't be claiming that if he weren't in this hot water around the raid on his office at the Legislature. I'm sure he'd be claiming success at every turn.
Well then, I'll ask very specific questions about the various deals that are underway by Partnerships B.C. How many proponents are left in the bidding for the Abbotsford hospital?
Hon. G. Collins: I think it's been publicly stated that it's one.
J. MacPhail: What happened to the other bidders?
Hon. G. Collins: They dropped out over time.
J. MacPhail: Why?
Hon. G. Collins: Because it wasn't a transaction that they felt they could complete.
J. MacPhail: Did they file any formal withdrawal letters about why they couldn't complete the project?
Hon. G. Collins: I'm told yes.
J. MacPhail: What did those letters say? How many bids were there initially? Maybe the minister could read the letters into the record, please.
Hon. G. Collins: I don't have them with me, but under the normal procedures, I'll try and get them to the member if she's requesting them.
J. MacPhail: I'm sorry. Why are they not here? I assume this would be part of the debate around Partnerships B.C. How long will it take? I would like the letters. It's always awkward not to have this information available in estimates. How long will it take?
Hon. G. Collins: I'm certainly prepared to talk about the general content of the letters and the reasons behind it if I can. Correspondence like that is subject to freedom of information and protection of privacy. The individuals who wrote those letters have business issues they may want to deal with, and they'd need to be consulted. That's the act she put into place and voted in favour of.
J. MacPhail: Oh, balderdash. Why is it that this government, this minister in particular, always says: "Use FOI." What happened to the promise of openness and accountability? What happened to the Premier's statement that openness beats hiddenness any day? What happened to that?
I would like the letters. There is no provision under the act that allows the minister to prevent releasing those letters to me. In the meantime, I will take him up on his offer right now to give me a summary — per bid, please.
Hon. G. Collins: There actually is something in the act. It's third-party confidence, and it needs to be respected. We just don't release that kind of stuff without the advice….
J. MacPhail: They've withdrawn.
The Chair: The minister has the floor.
J. MacPhail: There is no competition.
The Chair: The minister has the floor.
Hon. G. Collins: I have no knowledge whether there are items in those particular letters that may be prejudicial to future bids that those companies might make or be making presently in other parts of the world. I've no knowledge of that. The member might like to have everything at her fingertips, but unfortunately for her, the law she helped put in place and
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voted in favour of and continues to support, I think, requires that we respect the rights of those third parties. It's not just freedom of information; it's also protection of privacy. The member is aware of that.
J. MacPhail: Can I have a summary of the contents, please?
Hon. G. Collins: I'm advised that both proponent teams have been striving to meet the time lines and requirements as outlined in the RFP. The Healthcare Infrastructure Co. of Canada reached the business decision that they could not continue and submit a winning proposal within the time lines available, which effectively took them out of the process. That leaves one remaining. I'll try and find out if we can give a bit of a summary as to the rationale why the other two proponents withdrew as well.
Hon. G. Collins: I'm advised that the other two…. The first two proponents to withdraw did not put up their quarter-million-dollar bond in order to proceed to the next stage.
J. MacPhail: What are the time lines that the last remaining bidder is having to meet?
Hon. G. Collins: We expect to receive a final proposal from the proponent on April 16.
J. MacPhail: I assume it wasn't the bidding time lines that the first proponent couldn't meet. It was the completion-of-project time lines. Or am I wrong?
Hon. G. Collins: The first two, as I mentioned…. I'm not sure which of them the member is referring to. The first two withdrawals happened because they didn't post the bond. The third person to withdraw is because, as I've said, they couldn't meet the time limits. The proposal they thought would win, given the time limits for submission that were in place…. Those time limits for submission are driven by the time lines for the project itself, which is 13 years overdue.
J. MacPhail: And, I predict, won't be completed before this government is out of office. I predict that. I bet it won't even be started.
What is the time line for building the hospital?
Hon. G. Collins: We anticipate the final proponent to be on site this fall, and we are anticipating and forecasting that the hospital will be open in the 2007-08 fiscal year.
J. MacPhail: Has there been a revised cost to the project?
Hon. G. Collins: I'll just sort of give the rationale first, and then I'll try and get the numbers for the member — what the numbers are for the increased scope of the project.
There were a number of things. This release, I think, went out in September of last year. This is a background document which was released publicly as well. It's on the website, if the member wants to look. It's www.abbotsfordhospitalandcancercentre.ca. I'm sure her staff can look that up if they want.
There are nine changes to the facility. There is expanded emergency care; a 25 percent larger emergency area to accommodate larger room sizes; an expanded decontamination site; two additional secure rooms and four stretchers in the psychiatric clinical decision unit and a small child play area in the waiting room; more stringent infection control measures. As a result of SARS, the infection control measures are being revised, I think, across the health care sector, probably around the world. Resulting increased space requirements to provide appropriate care…. More than 100 rooms in the hospital will be set up as negative pressure isolation rooms essential to management of disease control, communicable diseases. All rooms in the hospital will be either semi-private or private.
There is a separate cardiac care unit and a separate intensive care unit. It was originally planned to be a combined unit. Now the two will be separate. That's a 15 percent increase in the space overall. There will be eight critical care unit beds and eight telemetry beds. The intensive step-down care unit will consist of ten ICU beds and ten medical-surgical step-down beds.
There is a child-focus health care component to all of this. There is a child rehabilitation space that's been added to create a child-friendly area where physiotherapy, occupational therapy and other disciplines can work with children. The medical and surgical day care spaces for children have increased from four to eight spaces. As part of the emergency area expansion, emergency pediatric space has doubled to support a child-friendly philosophy. Pediatric out-patient services have increased, recognizing the benefits of the trend to care for children at home and in an out-patient setting whenever possible. Space for children has increased from two to four clinics.
Advanced technology. Two out of the eight operating rooms will have teleconferencing and videoconferencing facilities, allowing surgeons to operate with the virtual presence of medical experts from around the world. In general, the estimates for space and equipment, etc. — refrigeration — have increased as well.
Medical equipment and associated services. Plans call for a second CAT scan, computerized procedure room, control rooms, PET scans, X-rays, an additional six hemodialysis stations, a 25 percent increase in that space. The surgical day care unit has added seven additional stretcher beds, for a total of 30. They're doubling the size of the sleep lab program area and adding an exam consult room and a neurodiagnostics area.
There is an expansion in the academic space. It's going to be a state-of-the-art teaching hospital now, with an expanded academic and ongoing learning pro-
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gram to meet anticipated teaching responsibilities in the future. The facilities allow for partnerships with medical and nursing schools, including conference rooms, computer facilities and study rooms. That's a major component. More facilities will accommodate students in residence, including locker space, rest space, sleep rooms. The hospital library services will merge with the cancer centre medical library, which allows for shared operating costs. That'll keep costs down, not up.
The cancer program. Two new out-patient programs have been added to the plans for the hospital and cancer centre. There's a breast health program — a collaboration between the B.C. Cancer Agency and the Fraser health authority — and the hereditary cancer program, integrated into the shared specialty clinic service area of the ambulatory care centre. There are enhanced brachytherapy services, which is a special localized radiation therapy treatment — I didn't know that — and expanded chemotherapy treatment chairs and multidisciplinary teamwork areas based on projected increases in the demand for cancer treatment services.
Also, generally it's going to be about 15 percent larger than it was in 2001. It will be 60,000 square metres, and it'll be three times the size of the current hospital. I think that's pretty much it. The new hospital and cancer centre have LEED, Leadership in Energy and Environmental Design, silver certification, a recognized standard for green buildings used to assess environmental sustainability of building designs.
I think it's fair to say that over the 13 years from when this hospital was first designed to the one that's being designed now, the population of the Fraser Valley has doubled. There are clearly greater demands for cancer care in the valley, and that's being accommodated, as well as all the other types of upgrades I've talked about. It's a significantly different hospital than it was before. I'm told the cost is $300 million, including $90 million in equipment.
J. MacPhail: When this government first proposed it, what was the cost?
[R. Stewart in the chair.]
Hon. G. Collins: Actually, the previous government proposed it, and I think it was about $210 million.
J. MacPhail: The previous government funded it out of public moneys. This government actually took it to a private builder. It's 15 percent larger, and the budget has increased about — what? — over 25 percent. How's that?
Hon. G. Collins: The numbers, the math…. I wasn't actually listening when she did her calculations, so I'm not sure what she said. I think the gist of it was that the cost went up and the size increased. It did increase substantially in size. I think I said it was…
J. MacPhail: Fifteen percent.
Hon. G. Collins: …15 percent larger. It's now 16,000 square metres. I think what would be a big cost, as well, is just the technology that goes into this and some of the modern facilities as well as the equipment that has gone into it.
J. MacPhail: I'm sorry. My math — I was doing it in my head. It's more than a 40 percent increase in the cost. Could the minister break down the 40 percent increase for a 15 percent larger hospital?
Hon. G. Collins: The equipment budget went from $30 million to $90 million because of a lot of those things that I talked about in the list. I'm trying to answer these as best I can. If she wants some more technical answers on what this all means…. She probably knows better than me, having been Minister of Health. The project was $210 million. It's now $300 million, of which $90 million is equipment. That budget for equipment went from $30 million to $90 million.
J. MacPhail: How does the provision of medical technical equipment work in this deal?
Hon. G. Collins: This might be helpful to the member. Under the arrangement, the plan is that the partner will design, finance, build, maintain and operate the facilities management services — the facilities management part of it; be responsible for the capital costs and the facility operating costs; have a licence to use the facility to provide services; and be paid for services when they meet our standards and leave the facility in good condition at the end of the contract. That's all written into the contract.
The province's role is that we will own the facility and the land. We deliver all the health care services themselves, and we report both an asset and a liability as a result.
J. MacPhail: Where else in Canada has the equipment for delivery of health care services been privatized?
Hon. G. Collins: I don't know that. It's not an unusual structure. It's done elsewhere in the world with partnerships around health care — in the U.K., Australia and elsewhere. I don't know the construct of the transactions that are being negotiated now in Ontario. I think there are two in Ontario that are underway.
J. MacPhail: Is there a Canadian model on which this is based?
Hon. G. Collins: We actually own the equipment. We own the building; we own the land; we own the equipment. I think that's the answer to the first question the member asked.
I think there are only three hospitals in the country that are being done through public-private partner-
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ships at this point. This is one. I think there are two in Ontario. While there aren't lots of models in Canada, there are lots of models internationally.
J. MacPhail: I'm familiar with the Australian models, which have failed miserably, and those are through public reports. So how does the ownership of the equipment work? Where does that get budgeted? In whose budget is that?
Hon. G. Collins: It would be in the budget of the health authorities. I mentioned that there is an asset and a liability. The asset would rest with the health authority and the Cancer Agency, both of which are part of the government reporting entity, so they'd appear on our books.
J. MacPhail: That's news to me. I'm interested in this. This is the first time I've heard this. Out of the $300 million, how much is the private contribution, and who bears the risk? This is the first time I've heard that the equipment is owned by the public.
Hon. G. Collins: I'll run through the list again. Just to give the member an example, the CT scan we would own. The floor polisher the private sector partner would own, and that would be part of them providing their services, and it's actually delineated, I think.
Let me just restate my earlier answer, because it may give the member a sense of that. The private sector partner designs, finances, builds, maintains and operates the facility's management services. They're responsible for the capital costs and facility operating costs. They have a licence to use the facility to provide services. They are paid for their services when they meet our standards and they leave the facility in good condition at the end of the contract. We own the facility, the land and major equipment. We deliver all the health care as a public provider, and we report both, obviously, as a result — an asset and a liability, as I stated.
J. MacPhail: What amount of tax dollars is being contributed to build this and own the equipment?
Hon. G. Collins: Just to go back again to my earlier statement: the partner designs; finances; and then they build, maintain and operate the facility's management services. The private partner will actually go out and purchase whatever they need to build this place, to have the equipment in place, to have it up and ready to open the door. We end up owning the land, the facility and the major equipment, and we pay them a payment for that, based on the service that we get. It has to be up to our standards, and there are certain criteria around that written into the contract. There will be an ongoing payment to operate the project in the years ahead.
J. MacPhail: Yes, and the taxpayer doesn't own it until the completion of the contract. Is that correct?
Hon. G. Collins: As I mentioned, they finance it. They build it; they finance it. When we unlock the door, move in and actually start to operate the place, the assets transfer to us, and we make them a contracted payment based on the service, which would include the costs of delivering the service as well as the cost of the capital — their financing — and we would be paying them for it. But it appears as an asset and a liability on our books because of the consolidation of the entity.
J. MacPhail: When does it appear just as an asset?
Hon. G. Collins: When there's no longer a liability that's attached to it.
J. MacPhail: When's that?
Hon. G. Collins: I'll try and find out for you.
There would be amortization of the assets. Not the land, obviously, but the building would amortize over 35 years. I think that's the accounting policy. The medical equipment and technical equipment would be amortized at a different rate.
You know, that could change too. I mean, accounting policy changes from time to time. But also, we could have all these cancer centres set up and running, and three years from now, or ten years from now, somebody could find a cure for cancer, and you'd write it all down. So the liability that's on the books will vary depending on the asset and the value of the asset.
J. MacPhail: I don't think this has to do with accounting. Let me see whether I can explain how I understand it, and the minister can change where I'm wrong. This is about a private operator building everything, financing it herself, financing the equipment, and the government will pay a mortgage on that until they own it. Until they pay off the mortgage, the private operator has proprietary rights to that. They have to live up to the contract, but the government and the taxpayers do not own it until the mortgage is paid off on both the equipment and the building.
Hon. G. Collins: Much like you would own…. You would go and buy a house. You actually own the house. You may have a mortgage and a debt attached to it, but you actually….
The Chair: The minister has the floor.
Hon. G. Collins: The asset is on our books as a liability until it has depreciated. There is a contract payment that happens on an ongoing basis to provide the services that they're contracted for. As I said earlier, a component of that payment obviously would go to the provider to service the debt that accrued, the debt that's there on the building. That's what it's for.
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J. MacPhail: Well, I'm actually mortgage-free, but when I had a mortgage, the bank owned my house. If I didn't pay my mortgage, the bank repossesses houses.
J. MacPhail: When I held a mortgage — just as this government will owe mortgage payments on this. I don't know what the minister is trying to hide here. He seems to be quite proud of it, but the fact of the matter is that there will not be public ownership until the mortgage is paid off. What are the risk arrangements in the contract to prevent default on either side?
Hon. G. Collins: The contract's not signed yet.
J. MacPhail: What did the bid require?
Hon. G. Collins: Sorry, I missed the question the member asked. Perhaps she could ask it again.
J. MacPhail: What risk provisions are there in case of default on either side?
Hon. G. Collins: The contract is yet to be completed, but I can give the member a general sense of the securities that would be there for the public. There would be the proponent, and the operator is expected to operate the hospital to a specific standard. If they don't, they could lose any bonus provisions that are in there. Their payment could be reduced — deductions from the monthly payments. If it really wasn't working properly, government would have the right to step in and take over the operations. There would be all sorts of tick-offs as to things that had to happen before you could do that. You could actually terminate the contract in the event of a major problem. Again, there would be criteria worked into the contract to do that.
Our security, obviously, is that all of the financing, all of the capital investment of the proponent, is at risk. We can step in and terminate and take it over if they're not delivering on the service as they need to, in an extreme case. Also, the stream of payments is obviously at risk, because we can stop those or reduce those depending on whether they're living up to the contract that's before them. It will be quite a detailed contract of service levels they need to provide and outcomes they need to provide as well.
J. MacPhail: What is the rate of interest that the proponent is allowed to build into its financing? Does that get passed on nickel for nickel to the health authority?
Hon. G. Collins: No, that would be their risk. That would be part of the competition for them to try to get the best rate they could. If they can only get 20 percent interest, then they've got to eat that. They obviously wouldn't be competitive. If they can get a lower rate, then they're obviously competitive. The bidding process…. We arrive at the services we want provided for us, and there's a payment to them. What they pay for interest is up to them to figure out. We have a bidding process that arrives at the best benefit and the best service level for the best price.
J. MacPhail: There must be some accounting for risk. There must be something in the bid that deals with the issue of financing and costs of financing.
Hon. G. Collins: I don't know who the final proponent is, but some of the proponents that were in early on were large enough that they could finance this stuff internally. They had actual cash and capital they could use internally to do this. I don't know who the final proponent is and all the details of that, but if they wanted to go borrow it, their costs of capital could be very competitive. It could be different for different organizations. It would depend on their credit rating. It would depend on where they could raise their money. That's a risk they bear. We transfer that risk to them. They would go out there and compete and try to put together the best bid.
Now obviously, part of what they can provide for services at a particular cost…. If they can get their interest costs down below somebody else, then they can provide better service or a lower bid or whatever, but we don't dictate a cost. We can go out and hire people to model for us what we think their costs of capital would be, but we don't know what their costs of capital are, I guess, until they finally bid and we actually see all the details. Even then, I don't know if we get to see it.
J. MacPhail: Let me try this approach, then. Is there any difference in the payment that the health authority will be making to the private proponent than the cost would be to government if government built this itself?
Hon. G. Collins: If I heard the member correctly, generally, I think where she's going, and maybe I'm wrong, is the comparator of what the public sector can borrow at and what the private sector partner could borrow at.
J. MacPhail: Charge.
Hon. G. Collins: To my understanding — correct me if I'm wrong — they don't charge us for an interest payment; they charge us for a set of services they deliver. It includes financing and building the asset. They then have to provide that based on all sorts of things. There are all sorts of little things that will go into their determination of what they can bid for a price. Here's a payment; what can you deliver for that? Here's a set of services; what does it cost for us to buy those services from you? Interest will be a component in a very large formula that they will put together as bidders, and it will probably be different from bidder to bidder.
I don't know what that number is, and I don't know if we ever get to know what their number is, because
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they're not just going to bid on this hospital; they'll probably bid on other ones. It's not the concern for us. It's what we are getting from the various bidders. What are we getting for the price we're paying? There'll be the cost of that floor polisher I talked about. There'll be the cost of the floor wax they're going to use for 30 years or whatever. All those things will be part of it. I'm not just being facetious. There's a long list of things they're going to have to deal with, and finance costs will be one of them.
I know there was a thing that was put out by the HEU a little while ago, a report that had the cost of capital at 5 percent. Well, the government doesn't borrow at 5 percent. I expect that that number — the cost of capital for the private sector — would be higher than 5 percent. I don't know that. They'd have to make that determination on their own.
J. MacPhail: All right. Let me try to make my question clearer. I assume that the government has done some modelling to suggest that this is cheaper for the taxpayers. What is the difference in the cost to the health authority in payments to the proponent versus public building and delivering of the services?
Hon. G. Collins: I don't recall if we talked about this last year. We might have. It's the public sector comparator. I think the member was asking about that. There is a public sector comparator that's done. There's a model that constructs a public sector comparator. That's released at the time the contract is signed. That's been public for some time.
J. MacPhail: What does it say related to the Abbotsford hospital at $300 million?
Hon. G. Collins: Sorry. The public sector comparator is not public. The fact that there will be one published at the time the contract is signed has been published.
J. MacPhail: So we have to wait until the deal is done to find out whether it will be cheaper to do it in the public?
Hon. G. Collins: The RFP, I'm told, is published on the website at Partnerships B.C., and in that there are some public sector comparator targets that the proponents have to hit. It's there, and it's been there for a while.
J. MacPhail: Final question on Abbotsford, and then I'm going to move to the RAV line, which is part of Partnerships B.C.
Is the proponent committed? The one bidder that's left — are they in it for the duration? Do we know that for sure?
Hon. G. Collins: We expect so, but not until the actual contract is signed.
The member mentioned RAV. That's actually a TransLink project. We're tangentially, I think, dealing with that. I'm prepared to ask questions to the extent that I can.
J. MacPhail: Well, sorry. It's listed as the projects under Partnerships B.C., so those are the two that….
J. MacPhail: What is the role of government?
Hon. G. Collins: It's a little different from some of the other items that are in the service plan. From time to time different projects…. Partnerships B.C. will play a different role. In this case, Partnerships B.C.'s role, and we pay a fee to Partnerships B.C., a retainer on an ongoing basis, which we discussed at length last year….
Part of their role here for government is to be the eyes of government, watching for the provincial government's interests in that transaction. We're a small component — well, not small, but a participant in it in that we're putting money into it. The federal government is as well. I'm assuming they have people there, watching their interests. It really is a TransLink project. We're just making sure our funds are dealt with properly.
J. MacPhail: How much provincial government money is going into RAV, and how is it being managed?
Hon. G. Collins: We're just confirming it, but I believe the number is $300 million.
J. MacPhail: Since the estimates of last year, the Premier of British Columbia went public and said we need $450 million from the federal government in order to complete this project. He didn't get that. He got a commitment of $300 million. Where does that commitment stand?
Hon. G. Collins: To the best of my knowledge, the commitment from the federal government stands. There are ongoing negotiations with the federal government to try and secure additional funds. I was not involved in that debate, so I can't be certain. Certainly, the Minister of Transportation would probably have a better idea as well as the Premier, but I'm glad to try and find that information for the member as well.
J. MacPhail: In question period I raised a matter showing a federal news release, fresh off the printer, that said $60 million of the $111 million for rural infrastructure was dedicated to the RAV line. What has since happened to that — what the Premier said was wrong by the federal government?
Hon. G. Collins: It is still wrong. The Premier has been very adamant right from the beginning on this
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that the RAV project should not take proceeds from other projects in British Columbia. That's been a very base starting position for discussions with the federal government. He's been adamant about that. He's said it publicly, repeatedly. The federal government is wrong.
J. MacPhail: No, I understand that's the provincial government's position, but he also said he had people in Ottawa that very moment who were dealing with that. What's the status of that?
Hon. G. Collins: I expect we told them they were wrong. I don't know what happened as a result of that meeting, but our position right from the very beginning — and it continues to be — is that this project should not draw resources from other projects in the province.
J. MacPhail: I'm just wondering. If it's $300 million of provincial money, and there's a disagreement about the source of the federal government's money, how is the project proceeding according to Partnerships B.C.?
Hon. G. Collins: The negotiations with the federal government are being done through intergovernmental relations, which rests in the Premier's office and is generally done through the Deputy Minister, Ken Dobell, to the Premier. From our role in monitoring the project itself and the progress as far as the province is concerned, we anticipate the — I think it is — best and final offer sometime in March. As the member will know, the vote by TransLink, who are really the lead on this project, passed by one vote. That will continue.
J. MacPhail: What's the status of the government's commitment that any new fees or taxes levied by TransLink will be subject to a referendum?
Hon. G. Collins: To my knowledge, it's the same as it was stated in the New Era document. The Minister of Transportation could probably answer that better than I.
J. MacPhail: So I should ask the Premier about the infrastructure money, and I should ask the Minister of Transportation about the new-era commitment on referenda. Has the cabinet discussed the matter of TransLink raising levies or fees or taxes and having a referendum?
Hon. G. Collins: To my knowledge, that issue has not been discussed. I'm not always there.
J. MacPhail: Well, what is the member's attendance at cabinet?
Hon. G. Collins: Pretty good. You can FOI it if you want.
J. MacPhail: It's interesting how that commitment…. With all this discussion around TransLink and the lack of certainty around the federal money and now the increasing lack of certainty around the federal money, this government hasn't once mentioned a referendum, hasn't said: "Whoa. Wait a second, TransLink. You can't impose those new taxes without a referendum, because that was our commitment." There's dead silence on it.
Partnerships B.C., in its role as managing the interest of the provincial government, will be aware that there was a second part to the RFP where if the original RFP's scope could not be met within the budget, they were allowed to submit an alternate bid. What's the status of that?
Hon. G. Collins: That's the Ministry of Transportation's role, not ours.
J. MacPhail: Okay. Why doesn't the minister just tell me, then, what question I could ask about RAV? It's quite clear here. There's no limit about the role that Partnerships B.C. is playing here. It's got pretty much the whole thing down there. Can Partnerships B.C. answer questions about the scope of the project?
Hon. G. Collins: As I said earlier, the role of Partnerships B.C. on this file is quite limited. It is not the sort of project facilitator as it is in the Abbotsford hospital. It's not the project proponent. In fact, government isn't even the project proponent; TransLink is the project proponent. We have some money at the table, and we're sitting at the table to make sure our money is dealt with fairly. Above and beyond that, Partnerships B.C. is not involved in a big way with the progression of this project. It's really TransLink. As I mentioned, the Minister of Transportation could probably answer the more detailed questions better than I.
J. MacPhail: Then perhaps I could go through the projects. It's on page…. Well, it's the list of projects under the annual report, or is it the service plan? Anyway, the minister will know where it is. Oh no, it's the annual report.
Could he tell me which of these projects Partnerships B.C. actually has the lead on?
Hon. G. Collins: I'll run through the ones. I've got the service plan for this year, which starts on page 25. It's the appendix, which is the project highlights — page 25, for the member.
The Abbotsford hospital — we're the lead on that, in a role much as I've described here today to the member. The academic ambulatory care centre, which I think is a pretty straightforward project — we're observers on that one. The Britannia mine — we're the lead so it would be similar to what we are doing with the Abbotsford hospital. It's a much less complicated transaction, I would think, although an interesting one.
The Fraser River crossing — we just provide support. We're like a business adviser, if they have ques-
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tions for us. We don't play a major role there. The same with the Okanagan Lake Bridge. I think that's because that one was well advanced in its planning, etc.
We're support in the Richmond RAV line, as I mentioned earlier to the member. We're the lead on the Sea to Sky Highway, with the Ministry of Transportation, and we're the lead in the Sierra-Yoyo-Desan road in the northeast.
The Knowledge Network — we're advising on that. That's it.
J. MacPhail: Partnerships B.C. is dealing with four leads. I don't think this list has changed from last year. What other initiatives is Partnerships B.C. exploring?
Hon. G. Collins: There is probably an array of projects that come to our attention from time to time. Lots of those don't go anywhere. Partnerships B.C. is asked at times to be business advisers on projects for other entities. Sometimes we're able to do that; sometimes we're not. It's not an appropriate thing. It will change from time to time. There are other initiatives that come along.
There are still some projects we're trying to clean up that sort of went with the capital management people to Partnerships B.C. from the Ministry of Finance, one being Burns Bog. Partnerships B.C. is helping with that. I'm trying to think about some other ones that might be obvious. The Kicking Horse Canyon with the Ministry Transportation — they're playing a role. The Knowledge Network — trying to facilitate that.
Those are dispositions of assets — not all of them. The Knowledge Network is, and Burns Bog is a purchase of an asset. Kicking Horse Canyon is a Ministry of Transportation project. Those are the kinds of other things that come our way, and we have a limited role sometimes, and potentially, in some cases, it could be a much greater role. That gives the member a sense of the types of things we get from time to time.
J. MacPhail: What changes, if any, have there been to the service plan for Partnerships B.C. — the financing of it, revenues?
Hon. G. Collins: I'll just get the answer to that for the member. She can probably compare the two — last year to this year. I want to confirm for the member that I said I thought it was $300 million — the provincial government's commitment to RAV. That is in fact the case. I told her I'd try and get that for her, so I'll answer her other question in just a minute.
I think the biggest change is that we have a board in place. It's actually an excellent board — high-level people from across the country who have been really positive. I'm glad to walk the member through some of those people, if she wants.
Rick Mahler is the chair. Larry Blain is the CEO. Harold Calla is from the Squamish nation, with extensive business experience. Celia Courchene is VP of Xenon Genetics. Jim Dinning is from Alberta. Ellen Hosieris the vice-president of finance at a number of companies here. Charles Jago the member would know from Prince George. Barry Lapointe is the CEO of Kelowna Flightcraft. Doug MacKay, of Vancouver, is an engineer and a chartered arbitrator. Carol Stephenson is from London, Ontario, and she's the elected dean of the Richard Ivey School of Business at the University of Western Ontario. I think it's a real coup that we have her here. She provides some national perspective and also a solid business background, both academic as well as practical.
That board has met with the executive at Partnerships B.C. They've now put together a full business plan. They've set out some goals and some objectives for the corporation. They have set some client satisfaction measures to determine whether they're performing for the people that are contracting with them. There are some goals about serving the public interest to ensure fair competitive processes.
Obviously, one of the goals, and we've been talking about this since the beginning, is to make sure that British Columbia — and Partnerships B.C., in particular — are seen as centres of excellence for P3 initiatives across the world. There are really, I think, two observed centres of excellence: one in the U.K. and one in Australia.
We think that British Columbia can take the lead role. We've certainly had very positive feedback from other provinces at conferences. People like the model here. They think it's the right one for work in our environment. It's a little different from the U.K. It's a little different from Australia. But certainly it works well here. We've had many positive comments from other provinces about the structure, about the processes we've put in place. Many are eager to see, as we close some of these partnerships, some of the successes and some of the things we all can learn from them.
J. MacPhail: The resource summary on page 23 of the service plan…. I was looking, and in other parts of services plans they tell what the changes have been from previous revenue forecasts, etc. What, if any, changes are there in '04-05 through to '06-07 from the last rolling three-year service plan?
Hon. G. Collins: I don't think I have last year's with me. If I do, I'll find out in a second. I certainly have, I believe, this year's.
This would change on an ongoing basis depending upon which projects we thought would be completed and when the payments would be made to Partnerships B.C. for the various projects. You have schedules for these. Sometimes they take longer; sometimes they move more quickly. That would obviously mean that the revenue curve for the company would be dependent upon that.
I will try and see if I can get last year's to compare. Certainly, I'd be more than happy to provide the member with last year's and this year's, and she can compare them herself if she wants.
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J. MacPhail: What I'm noting here is that the bottom line of Partnerships B.C. never exceeds the provincial government contribution. Well, in one year it does — '04-05. This year it gets $1.8 million from the provincial government, and its net income is about $1.996 million. Every other year the net income of Partnerships B.C. falls short of the provincial government contribution. I note that project revenues are in the decline year over year throughout. They flatten out in '06-07.
What success indicators are there, other than revenues?
Hon. G. Collins: I talked earlier about some of the things the board had put in place around client satisfaction — some of the other measures that would be there. The revenue from project recoveries, etc., is going to change, as I mentioned.
This is a forecast of when we think various projects might close and what the fees might be for Partnerships B.C. It's the forecast to the best of our ability. It could change, obviously. This is based on the projects that we're aware of now. If there were other projects to come on stream…. We are trying to do that on an ongoing basis — build a steady business for Partnerships B.C. over time so they become more and more self-reliant. Then, obviously, that would contribute to that bottom line.
This is our forecast. It's based on the projects that we're aware of and, to the best of our ability, our projection of when they might complete and when payments might be made to Partnerships B.C. I think it's fair to say that, depending on all of that, those numbers could change.
There are big revenues up and down for this company. It's not like they sell thousands of items and it can go up and down half a percentage point. They have a limited number of projects. Either the payments happen, or they don't happen, so the numbers can go up and down. It can move from fiscal year to fiscal year.
The goal has always been for Partnerships B.C. to become financially self-sufficient. We'll continue to work towards that.
J. MacPhail: I have questions, before I turn it over to my colleague, on revenue changes, generally, outlined at page 34. Then I have one other area of…. Well, we can do PSAC very quickly.
What, if any, salary increases are budgeted for across government, including the whole SUCH sector?
Hon. G. Collins: The government has had a negotiating mandate of zero-zero-and-zero, which includes '04-05 and '05-06. The Treasury Board has yet to set the bargaining mandate for '06-07. They'll do that some time in the not too distant future. Within that time line, government has no plans to provide wage increases to anybody in the public sector over and above what might be required in specific market adjustments where there's a proven case for that. That's been our position for the last couple of years, and it remains the case.
J. MacPhail: With the inclusion of the completion of the generally accepted accounting principles for this budget, does the minister agree with me now that all of those items, those entities that have been included, are subject to questioning at estimates?
Hon. G. Collins: Well, we don't actually control them. I suppose in the accounting sense, you might. There are school boards that have their own budgets. They're elected. They're responsible for their own thing. I know that right now the Minister of Health is fielding questions with regard to the Ministry of Health and, I'm assuming, probably what goes on in the health authorities.
The universities…. I don't see that the line of debate that's happened in this House in the past is going to change much as a result of the SUCH sector. I mean, the Workers Compensation Board, which isn't even in the government entity, has been a topic of discussion in estimates. I don't imagine that's going to change.
J. MacPhail: I heard you answer the questions to the member for Malahat–Juan de Fuca about accounting changes. Other than a demand from accountants, what is the public interest in this matter? That's why I am asking. Does the public interest now include the ability for someone to be held accountable?
Hon. G. Collins: I come back to my earlier example of the Workers Compensation Board, which isn't part of the government entity. I know there have been long debates in the House on legislation and on estimates about workers compensation. I participated in them in the past. I don't think that will change. I mean, at the end of the day, as the member knows, we're all accountable for everything that's in the entity and lots of stuff that isn't in the entity and stuff that's not even in the province. Sometimes you end up being held accountable for that.
I just don't think that anything with the changes as a result of compliance with GAAP is going to make any difference in how that would normally happen here in the chamber. I just can't think of an example of why it would.
J. MacPhail: Well, the debate around the Ministry of Education last year consisted of the Minister of Education saying: "Ask a school board that; that's got nothing to do with us." That was the debate, and it went on and on and on like that.
Let me just read into the record the topic box from the minister's fiscal plan:
"The decision to include the SUCH sector in the government reporting entity was a complex undertaking. In making this determination, the government followed the PSAB criteria" — the Public Sector Accounting Board is what that stands for — "for determining inclusion, which
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is based on whether or not an entity is controlled — or not controlled — by the government.
"The PSAB criteria clearly show that school districts, colleges and institutes, and health care organizations are controlled by government and should therefore be included in the government reporting entity."
It just goes on to say:
"The assets, liabilities and debt of the SUCH sector are included in the government's statement of financial position."
I would assume that some of this…. Oh, here:
"Spending by the SUCH sector reflects the cost incurred to deliver health and education programs on behalf of the province, in keeping with statutory obligations as well as for other related activities."
The only reason I was asking for an opinion by this minister is that surely if it's in the public interest that GAAP means something worthwhile to the taxpayer, his fellow ministers of the Crown who try to delegate responsibility for that to someone other than himself or herself won't be appropriate this year.
Hon. G. Collins: As the member knows, I've just spoken of an example of an entity that is not controlled by government and is not on our books, is not part of the entity under GAAP: the Workers Compensation Board. That's never precluded members from asking lots of questions, and it's never precluded ministers from saying: "That's not my business." Sometimes they talk about it; sometimes they don't.
The House is an interesting place sometimes. Members are entitled to ask any minister virtually any question they want, as long as it's in order with parliamentary rules. The minister may or may not answer. There's no obligation for ministers to answer any particular question that's put to them, although the opposition is always available to make that an issue. They can do that. I don't think anything that's happened with GAAP is likely to change any of the debate in this House one way or the other.
[H. Long in the chair.]
J. MacPhail: Well, that's disappointing, because I can't imagine that the intent of PSAB was just for accounting purposes. It was for accountability purposes. That's one of the premises underlining the PSAB guidelines — accountability. Anyway, we'll just have to wait and see whether anything's changed this year in that area.
I'm referring to page 34 of the Budget and Fiscal Plan: changes in commercial Crown corporation net income changes. These are just changes. Therefore, for '03-04, B.C. Hydro net income, from the original forecast, is $260 million higher. From Budget '03, the '04-05 net income is higher, and again and again. What's the basis for this?
Hon. G. Collins: In '03-04, I'm advised that the previous number was minus 70. It's now $260 million better than that. That's primarily due to better water levels. Last year when Hydro was forecasting, going into the budget cycle…. I think we get their forecast in December, and we're not really into the biggest snow season. They give you their best estimate based on what's in the snowpack at that point in time and try and project that. We had a lot of snow in the spring, so the snowpack was higher, the water levels were higher, and that's what drove that. In the out years, '04-05 and '05-06, I think the biggest part of that — I don't know if it's all of it, but it's a bigger part of it — would be the rate increases that are before the Utilities Commission.
J. MacPhail: Is it the minister's view that a swing of almost $300 million that leads to cuts in delivery of services is okay, but an estimate that allows delivery of services to continue but doesn't allow the budget to be balanced is not okay?
Hon. G. Collins: That's partly what the forecast allowance is for and partly what a contingency budget is for — to deal with those things. We had huge swings last year on the downward side as well: about an $800 million hit in the federal equalization transfer, both for in-year and prior-year adjustments; costs of forest fires, etc. I've itemized all of those things. You know, you try and forecast conservatively and prudently. You deal with what comes at you, and sometimes it's half a billion dollars' worth of forest fires, and you have to try and manage it. We do the best we can.
J. MacPhail: In fact, Mr. Chair, my only point was…. I remember that in 2001 this minister in particular just made a huge deal on the tabling of the budget about the outrageous forecast of B.C. Hydro. It was $300 million higher than one forecast made inside B.C. Hydro, and wasn't it awful that the Minister of Finance didn't take the low end of the revenue forecast? Of course, what that would have meant…. It turned out that the revenue forecast of that Minister of Finance was exactly accurate, and we didn't cut health and education.
That minister made such a big deal of it. Now he's got exactly the same swing, which actually is a reality of being off forecast by $300 million. He's cut services in the public sector, and I guess that's okay.
How much of the '04-05 $263 million increase is due to Hydro increases? All of it? The minister just said primarily it's due to that. Is the $263 million increased income from Hydro coming out of the pockets of the ratepayers?
Hon. G. Collins: The member is on page 34. If she looks at the bottom of page 35, where it says "Commercial Crown Corporations: B.C. Hydro and Power Authority," and turns the page, she'll see the answer.
J. MacPhail: As I understand it, it doesn't…. Oh, so it is the full $263 million. Let me just see. I just want to read this into the record, because the minister…. "British Columbia Hydro and Power Authority — forecasts
[ Page 9060 ]
$388 million in income before deferral transfers for 2004-05." Can he explain that, please?
Hon. G. Collins: That's the amount before the Hydro rate stabilization account transfer.
J. MacPhail: And then it goes on to say: "The forecast includes the impact of the 7.23 percent interim rate increase approved by the B.C. Utilities Commission that is effective April 1, 2004. The 2004-05 forecast represents a $263 million improvement to B.C. Hydro's projection in the Budget 2003 fiscal plan. The improvement reflects both the rate increase and a reduction in debt-servicing costs due to lower interest and debt levels." Can the minister break that down for me, please?
Hon. G. Collins: I'm actually not the minister responsible for B.C. Hydro, but I will try and get those numbers for the member. I don't have the Crown agencies here. We may have some data on it. I'll try and get that to the member.
J. MacPhail: Okay. Is it Treasury Board and the Ministry of Finance that do the revenue forecasts?
Hon. G. Collins: B.C. Hydro sends us a forecast. I guess that was the issue going back to 2001. There was some concern about which forecast the minister should take — that from the Crown or his own. At the time I felt it was better to take the one from the Crown than the one that he would have determined. I think at the end of the year his number was more accurate than Hydro's — good for him.
J. MacPhail: Yeah, good for him, but the minister never acknowledged that that could even be a possibility. Perhaps the minister should do some work on B.C. Hydro's forecasts. They don't seem to be that accurate.
I have two concluding questions. These are a follow-up from my questions around lobbying. The minister said he never met with Pilothouse. Did he ever meet with anyone from Omnitrax itself?
Hon. G. Collins: Yes. I have met with Pat Broe prior to the B.C. Rail transaction process starting. I met with him once after the B.C. Rail transaction had completed.
J. MacPhail: Boy, I'm sure glad I get the questions right. Is the minister aware of any of his staff that met with Omnitrax on his behalf?
Hon. G. Collins: I'm not aware of that, whether it would have happened or not — certainly not on my behalf. I wouldn't have directed anybody to do that.
J. MacPhail: And Pat Broe is whom?
Hon. G. Collins: He's the owner, president and CEO, I think, of Broe Companies, of which Omnitrax is a subsidiary.
J. MacPhail: What were the two meetings about?
Hon. G. Collins: The first meeting was, "Hi, this is who I am," on his part. "I'd like to come and invest in British Columbia. I think what you guys are doing makes sense. It looks like a great place for me to invest. I'm interested in all sorts of things." Just a general get-to-know-you type of meeting. I have those regularly with potential investors in British Columbia, if they want to come and talk. It's more of a welcome, get-to-know-you, individual meeting.
After the transaction had closed, Mr. Broe wanted to tell us that despite not winning the B.C. Rail contract, he would be interested in continuing to be part of British Columbia if he could — similar to the prior meeting.
J. MacPhail: Was Mr. Basi present at either of those meetings?
Hon. G. Collins: No.
J. MacPhail: Who staffed the minister?
Hon. G. Collins: I rarely take staff with me. I think it's a waste of their time for the most part when I travel or when I meet with them. Sometimes I do; sometimes I don't. It depends on what the need is. I had a dinner, and I didn't feel I needed staff at a dinner.
J. MacPhail: Was the minister aware that Omnitrax was bidding on the B.C. Rail spur line to Roberts Bank during that period of time?
Hon. G. Collins: No, I wasn't. I knew they were generally looking to do investments in British Columbia. We certainly didn't talk in any great detail about any of their proposals. Rather, it was a general discussion of things they might do in British Columbia. They were still interested in British Columbia. They were disappointed, obviously, that they weren't the successful bidder on CN, but they wanted to continue to have a presence in British Columbia. They were looking for things they might do.
There are a whole range of things they might do. I hope at some point that they are part of that.
J. MacPhail: Did the minister ever meet with a Mark Neumann, who is with Charles River Associates, the group that did the fairness report?
Hon. G. Collins: No.
J. MacPhail: Did the minister ever meet with Charles River Associates?
Hon. G. Collins: No.
E. Brenzinger: Minister, I'd like to ask you a series of questions related to the financing of the govern-
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ment's debt, interest rates and capital markets. You are to be congratulated on your plan to balance the government books in the forthcoming fiscal year and the capital markets attitude which has resulted from that accomplishment.
First of all, what was the attitude of the capital markets toward British Columbia in its fiscal performance and deficits under the previous government?
Hon. G. Collins: I forgot to introduce the gentleman who was here from PSEC. It was Al Sakalauskas. He's now gone. Sorry; I was negligent in doing that. We have beside me now Jim Hopkins, who heads up the treasury department in the ministry. That's sort of different from the Treasury Board. His role is to make sure we get the best costs of borrowing that we can.
The previous administration while they were in office had their credit rating downgraded twice by S&P, twice by Dominion Bond Rating Service and, lastly, once by Moody's — to the point where we ended up with a rating that was substantially lower than it was previously. It's fair to say that the rating agencies were very — how would I put it? — cynical about British Columbia and British Columbia's ability to deliver on commitments it made.
The Premier and I met with the credit rating agencies. I think we went to S&P and Moody's about a year and half prior to the election in a general way to talk to them about who we were and what our plan was. I don't know that they get a lot of visits from the opposition across the country, but we tried to describe to them what our plan was and what our philosophy was.
We went back to see them prior to the election with a more detailed sense of where were headed as a government. I went to see them right after the election, prior to the July update I put in place.
We've tried to establish a very professional relationship with them. We have a commitment that there are no surprises. We try to make sure that they have all the information they need to be comfortable with British Columbia. We also meet with them on an annual basis after the budget. We just completed those meetings last week, I guess. We spent almost a full day with each of them — each of the three — and I think it's fair to say that they're pleased and impressed that the government has stuck to its fiscal plan. That's certainly the report they issued last year. I don't think that's telling tales out of school. I think they were pleased we've continued with that to date. They'll be issuing a report, I think, by the end of March — the three of them — on where they think we're at now.
I would say that our relationship with them has improved substantially — but not just with them. They're a rating agency. It's really the financial markets themselves that have responded very positively to the government's changes. I talked about it in my opening comments yesterday, that we now trade at an interest rate that's 15 basis points below where it was a couple of years ago relative to Ontario. That's sort of the benchmark for Canada, so that's a pretty major improvement.
E. Brenzinger: When we use the phrase "capital markets," who are we talking about? For example, what institutions, what people and where are they located?
Hon. G. Collins: The capital markets are really everywhere. It's anywhere in the world that people have capital they want to invest. I mean, the member going to her bank and putting money in a savings account is part of the capital market. The bank then turns around and tries to invest that in some way that gets a return to its shareholders. Insurance companies do that. They receive insurance payments from people, and they invest those funds as part of their reserve on an ongoing basis between taking in and putting out. They always try to get a better return for their shareholders. The capital market is everywhere.
We certainly go and try and touch base with…. We tend to borrow big dollars. We don't go and borrow five bucks from mom, although I guess, tangentially and ultimately, we do. We generally borrow large sums when we do, in the hundreds of millions of dollars at a time. We tend to go to big institutional investors to tell our story and describe to them where the government has been, where it's going, where our economy is going, where our fiscal plan is headed and to convince them that we would be somebody they would like to lend money to. The better we can be in convincing them of that, obviously, the more competition there is to pick up those bonds or those capital offerings when we issue them. That drives our interest rate down.
E. Brenzinger: That's good clarification for my constituents.
What was the public debt of this government when the NDP came into office, and what was it when they left? Approximate figures will do.
Hon. G. Collins: If I go back to 1990-91, the provincial debt was $17.2 billion. When I go to 2000-01, which is the year in which the previous government left office, the debt had gone from $17.2 billion to $33.9 billion. It has now in the last couple of years gone to $36.5 billion. That's for '02-03. We're forecasting that will go up a little bit next year. I think it's supposed to go up $1.6 billion. But again, for the year we're in right now, we're forecasting it will come in about $3.6 billion under what our forecast was at the beginning of the year. The number for the year before, 2002-03, actually came in about $4.2 billion lower than was forecast.
E. Brenzinger: Did that increase in public debt change the confidence of the capital markets in British Columbia, and in what way?
Hon. G. Collins: As I've said before in my quarterly reports, one of the key indicators that credit rating
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agencies and lenders look at is your debt-to-GDP ratio, which is the amount of debt you have versus the size of your economy. The bigger your economy is, the more debt you can service. That ratio is important. The debt-to-GDP ratio is something they watch very carefully. They also watch trends in that as well.
When we brought our first plan into place in 2002, we forecast a debt-to-GDP ratio, topping out in '03-04, of about 25 percent. That number came down last year to just over 23 percent. This year it looks like the number for '03-04 will come in at about 21.7 percent. It goes up a little — like 2/10 of a point next year — currently on the forecast. That may change. Then it starts to trend downwards. At '06-07 we're forecasting it to be 20.3 percent.
All of that is a good indicator, and that's really what the markets look at. They look at lots of things, but that's a key indicator they look at.
V. Roddick: Hospital thrift stores have been run by volunteers and generate much-needed funds that they use to purchase equipment and services for local hospitals. Under bulletin 47 of the consumer tax branch, Social Service Tax Act, service clubs and non-profit thrift stores are exempt from charging PST for items of clothing under $100; children's clothing or footwear; magazines and books; and non-motorized, two-wheeled vehicles — bicycles.
For 20 years some hospital thrift stores have never charged PST. The government has not sought to remedy the situation. Under a similar principle where PACs are not required to pay PST on the purchase of basic school supplies, can the government consider exempting hospital thrift stores from charging PST on all items in their shops, given that the proceeds directly augment the purchase of hospital equipment and hospital expansion — money that would otherwise have to come from the health care budget?
Hon. G. Collins: I appreciate the intervention by the member, and the question. I hear that issue not infrequently from hospital societies and the thrift stores and people who do those kinds of things. Certainly, we did remove the requirement for parent advisory councils to pay PST on things they purchase with money they raised.
It can get very complicated. One of the things that drives me crazy, as minister, is how the PST is applied. It's very challenging to try and decide what's taxable and what isn't taxable. When is it taxable? When isn't it taxable? It's a very complicated process. We do review that tax policy every year. Almost without exception, I think every year I end up making some tweaks to that policy, in some form or other, as part of the budget.
There's a whole page, I think — I don't know if they're all PST — in the budget. There's a bunch of items — little changes. They're not material. They're not big-dollar items, but there are little changes that have happened.
That one has been presented to me. We always have to balance wanting to do more with what you've got available to you. This year coming up we start to run surpluses. We have surpluses the year after and the year after that. That provides government with choices and options.
As I've said before, one of the things that the Finance Committee does when it travels is get input from the public. One of the questions they'll be asking this year — obviously, again — is: what do we with those surpluses? There are really three choices. First, you could pay down debt, if you want, and not spend it. You could target those revenues to additional expenditures and say we want to add money to something or to a program or service. Or you could reduce taxes further.
The one that the member has presented is one that's certainly worthy of a look. I'm glad to get a submission. That would be part of the review that we would do each year. Prior to next year's budget I'll be looking at it again.
If we get a lot of input from people at the Finance Committee that that's a big priority for the public, then obviously that moves it up the list of things I look at. I always try and take the advice from the Finance Committee or what comes through the Finance Committee from the general public and incorporate that, where possible, into the budget. I look forward to submissions from people in the future and appreciate the one by the member.
E. Brenzinger: I would like to continue my questions on debt. What is the spread between the interest rate paid by British Columbia on our debt compared to that paid by Ontario on its debt, and what was the spread a decade or so ago? Have the spreads changed, and if so, how?
Hon. G. Collins: I don't have data going back…. The ministry might, in some closet or box somewhere, have the data going back that far. I just don't have it handy here.
It is fair to say that our spreads from July 2001 have tightened appreciably to now, to the point where we used to trade, as I said, about nine and a half basis points above Ontario. We'd pay an extra nine and a half basis points of interest over and above what Ontario would pay. Ontario was sort of a benchmark, because it's generally the lowest, although Alberta is right off the charts. They just don't borrow, so they're not out there. Ontario is the baseline you could look at.
If you compare where we were then, we came down and gradually tightened, tightened, tightened. Last year at this time when I was doing the investor tours post-budget, we were right around Ontario. Sometimes we'd trade through, sometimes above. We were right close to it. Since then our spreads have gone even further in the other direction. We just went to the market two weeks ago and borrowed at six and a half basis points through Ontario — so, less than Ontario. That was a thirty-year bond — about $500 million (Canadian), I think it was. The rate at the end of it was
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about 5.5 percent, so that's pretty good, looking out there.
It's fair to say — I'm reading — that ten years ago provincial spreads were about double what they are today. These are historical numbers that we're seeing.
E. Brenzinger: What is the dollar amount of new money we borrow each year, and what is the amount of old borrowing which rolls over each year? Where do we borrow the money — from what countries, in what currency? And in what term — to maturity? Long versus short?
Hon. G. Collins: We have a whole range of places we go to borrow money. The capital markets are big. Sometimes we borrow money from the Canada Pension Plan. There are some small things that happen there. That's generally not a huge amount of money, but it's part of it.
We can do what we call a private placement. We did one a year and a half ago out of Switzerland. We did an investor tour. We had a very good reception in Switzerland. People came to us and said they had lists of clients — I think this is how it works, and correct me if I'm wrong, Jim — who would be very interested in buying B.C. credit or borrowings. They put together what they thought was their key list of people. We put an offer out there, and they went and placed it for themselves. That wouldn't have been generally available to a whole bunch of people. It would have been their private placement. Is that how it works?
A Voice: Yes. Pretty much.
Hon. G. Collins: It's pretty close to how it works. I don't understand it nearly as much as these guys do. So that's an example.
There are other things we can do. We can go to the domestic market here in Canada and borrow in Canadian dollars. We have a syndicate of people who actually go out and get a percentage of that based on their performance. Then they have to go out and place that with investors. They could phone your mother or my mother and say: "Hey, I've got so much. Do you want to…?" I don't think my mother's in their league. I don't know if yours is. "Here are some B.C. bonds that are coming up. Are you interested?" They then go out and do that transaction.
We also can borrow in U.S. dollars in the U.S., and that happens sometimes. We can borrow in euros; we can borrow in Japanese yen — all different currencies. There is actually a list of currencies we are allowed to borrow in. It's about 30-some different currencies. We don't generally go into those currencies.
That sometimes exposes us to exchange rate fluctuations. We're not in that guessing game. That's not what we do. We don't try and play the exchange rate game; that's not our expertise. We generally swap back the Canadian dollar. That's a complicated financial transaction, which I'm not going to try to explain here, that reduces our exchange rate risk so it's minimal.
E. Brenzinger: Has this changed materially from a dozen years ago, and why?
Hon. G. Collins: I'm advised that we're probably more global than we were before. The markets have changed, technology has changed, and these kinds of transactions and capital internationally flow much easier than I think they probably did even 12 years ago.
We describe ourselves to potential people who lend us money as opportunistic borrowers. We go where the value is best for us. The province of Quebec, for example, tries to go into particular markets and create enough borrowing there that there's actually what they call a book of business big enough that people are aware of Quebec all the time. They do that because Quebec always likes to have that little chip on the table that they might go off and be their own country. Sometimes they pay premiums for that, but they have other goals. They try to create a presence for themselves in the financial markets.
We don't need to do that. We go where the best value is, and that's our goal.
E. Brenzinger: I do believe I'm entitled to a pension from Quebec when I retire.
How much money will we save through the narrowing of the interest rate spread?
Hon. G. Collins: It really depends on the length of term you look at. There are all different ways of calculating the savings and over how many years, etc.
The number I used yesterday was that 15 basis points difference from where we were to where we are now is worth about $20 million. That's a roughly accurate number. Jim's just pulling out this big, honking calculator that's probably linked to the Web, and he's going to get me a better number. That gives you a rough idea. If that's not accurate, I'm sure he'll let me know.
E. Brenzinger: One more question. Looking ahead, do you see the attitude of the capital markets improving towards B.C. debt? What are the risk factors?
Hon. G. Collins: First of all, risk factors. We're a pretty small player in the international capital markets — right? We're there, but I think this year Ontario could borrow, like, $20 billion or something. I don't know what the numbers are, but that's a big year for them.
Certainly, the trends…. When you see your debt-to-GDP ratio numbers trending downwards, when you see a good fiscal plan in place, when you're hitting those targets — all of those things send positive messages to the market. The market responds, and you can measure how the market feels about you. You can measure it day to day by looking at your spreads.
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When those spreads tighten through Ontario, that's a really positive comment that people are voting with their dollars on British Columbia. That's a really good sign.
There are all sorts of risks out there. I mean, I think the fact that the U.S. government is borrowing as much as they are puts pressure on interest rates. They tend to crowd out the capital markets — or could over time. That's a concern. It's beyond our control, but it's something we have to keep an eye on. General economic trends — all those things are big risks to us.
We do try to manage our portfolio pretty conservatively. We try to have a good ratio of fixed versus floating. We try to hedge our foreign currency exposure down to…. I think our policy is no more than 10 percent, but we're well below that. We have 5 percent on hedge, but we're actually earning money it. That's the Japanese yen swath. We actually have some that we're making, technically, negative interest on, so we just leave that open. We try to minimize our currency exchange risk.
We try to manage our reborrowings out in the future so that we don't get any big bumps in various years and so that we don't end up being forced to go to the market in a year that might not be great for us, more than we need to.
As we plan our borrowings for each year, we look to where there are little dips in our borrowings out 30, 40 years. We compare our gaps with what the market is telling us for those years — what we can get. If we see something that looks good for us, we'll go out and try to get that to fill in that hole and try to even that out over time.
B. Locke: My favourite school district, Surrey, has done a really excellent job of managing their fiscal house and making sure that their provisions to adapt to GAAP have been in place for quite some time. Can the minister tell me what, if any, additional financial pressures GAAP put on school boards? How long have the school districts known that they were to do their books with those kinds of requirements?
Hon. G. Collins: I think it's fair to say that school districts would have known if they had paid attention to the political system and our new-era commitment. They'd probably know the election night of 2001 that they were moving to GAAP by our third full budget. That was part of our election platform, so they would have known that way. Certainly, that direction went into my ministry as part of my letter of instruction from the Premier. We began working on that. The Ministry of Education would obviously have been aware of that. It's been an ongoing project. We've spent a lot of time with them.
I think it's fair to say as well that some school districts, such as Surrey, have a lot more capacity to deal with these kinds of things. They have probably a couple…. I won't ask for verification from the member, but they probably have accountants. They have sufficient resources to actually hire the people they need. I expect it's a challenge for all school districts. I would also expect that some would be better able to manage that than others.
There are some very small school districts where the chief financial people in the districts don't necessarily have any specific financial training. They're not accountants. We've had to deal with that as well. We work with ministers. We were trying to get school districts to GAAP last year. We gave them an extra year, because they weren't quite there yet, and we've been working with them ever since.
I think there's been a lot more anxiety about it than was necessary. It's been tricky and challenging. I think people sort of have to change to get their heads around things. Actually, I think it has improved the accounting policy across the public sector, forcing people to get there. There have been things that we have discovered in the health authorities and elsewhere as we've gone to GAAP that I think indicate it was exactly the right thing to do.
B. Locke: As the chair of Finance and Government Services Committee, we made 11 recommendations to the minister, and I'm wondering…. Some of those recommendations were incorporated into the budget. How will the ones that aren't being incorporated — some of them are sort of long-term project recommendations — be incorporated in the future?
Hon. G. Collins: I always make a point of reading the report that comes from the Finance Committee and keeping that in the back of my mind, as well as encouraging GCC chairs to do that, and Treasury Board generally encourages them to look at it as well.
How we choose to implement those over time…. I mean, obviously I like to be able to look at those recommendations and see if they can be incorporated into the budget, because I reflect them as priorities of British Columbia. You can't always do that; you can't always do that right away, even if you'd like to. So we try and address them, and if we can't do it right away, then we keep that on the burner. Sometimes people's priorities will change, but they may be consistent, and next year we'll be able to do it or the year after or the year after. Or maybe it is really a long-term project that we need to undertake.
R. Hawes: Minister, my question revolves around international finance centres. The investment community has said that this is maybe the real sleeper in the budget. I wonder, first, can you outline for my constituents what the plans are for the development of the International Financial Centre?
Hon. G. Collins: The International Financial Centre legislation was passed, I think, in 1988 or '89. I think it was for Vancouver and Montreal, and it was to give them particular tax advantages to attract international financial business. Montreal, Quebec, built on that by adding other components to it and other things that
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made it quite vibrant, and it actually was a fairly successful undertaking for them. British Columbia never did, and it sort of languished as a result of neglect, I would say.
We have had discussions for a number of years, both in opposition and in government, with the IFC. There's been a bit of revitalization that's happened there. New people have come on, and they came to us with a proposal. I and the former Minister of Competition, Science and Enterprise — the member for Okanagan-Westside, I think, is his riding — had been taking a bit of a lead on that.
Really, government had to decide whether we were…. In my opinion, anyway, we either had to really dive in here and make this work or just stop doing it. We had presentations, we looked at it, and we decided we'd really dive in and try and make it work. We've expanded the scope of things that can be included in that — the types of businesses, including film and television distribution as a different type. We also geographically expanded the scope of where those companies could locate. They don't have to be in Vancouver; they can be elsewhere in British Columbia.
IFC is very excited about those changes and have an aggressive marketing plan that's underway. They already have a big communications plan. I can tell because it's been appearing in all the business sections of the newspapers. That's a good indication to me that they're serious, they're excited, they're actually going to get out there and push this, and I hope it's very successful.
R. Hawes: Just following on the same theme, I wonder if the minister could outline…. Are there costs to government for diving in, as you put it, or expanding this?
Hon. G. Collins: There should be minimal, if any, costs to government, because what we're trying to do is grow new business. What it would mean is that you hope there are new businesses that set up and operate here. You would obviously receive some tax benefit from those businesses being here, and economic activity as well. You wouldn't receive as much as if they had just sprung up on their own, but then again, they haven't sprung up on their own in the last 12 or, I guess, 15, 16 years now. You'll see in the revenue table that there is no real cost to the IFC changes. We actually hope that there will be new businesses created, and there will be a positive tax benefit to British Columbia.
R. Hawes: Outside of the investment community, I would dare to say that there are very few people who understand what this concept is all about and, specifically, what kind of benefits to British Columbia it can bring and its value as an economic development tool. I wonder if the minister could briefly outline that for those many folks who don't know what we're talking about here.
Hon. G. Collins: The financial services sector is a growing sector of the economy worldwide. It is one of those service industries that's there. It's generally pretty high-paying jobs. It's something you like to see. Communities compete for that and would like it to be there. I don't know what percentage of the economy of New York City is the financial sector, but I bet it's a big chunk. Certainly, it's something we would like to build here in British Columbia. I don't think it'll ever be like New York City, but certainly, there are things that could be here.
It's not just new businesses that might spring up during these international financial transactions, but it's also exchange transactions of companies that are based in British Columbia. There are a couple of forest companies who moved their foreign exchange operations to Montreal because of the tax benefits that were there. Those are B.C. companies that picked up a component of their business and the people that go with that and moved them to Montreal. I know IFC has targeted those companies to bring those people home to British Columbia. It's not just new business that we'll be able to attract from around world and that we're going to try and attract from around the world, but it's also business that should have been here all along that we hope can come home again.
R. Hawes: Just one last question. That would be with respect to the film and television distribution under the IFC. Could you explain that and how it will benefit that industry?
Hon. G. Collins: As the member knows, there is a film and television industry here in British Columbia. One of the ways it's very sensitive to taxation issues is in the distribution of its product. There can sometimes be a fairly good flow of money through those kinds of transactions. We've had submissions from the film and television industry that they wanted to be part of IFC, because they think that's a business we could grow here in British Columbia and actually expand on.
They saw that tool of IFC as a potential mechanism, but it wasn't quite tailored to them. They weren't part of it, but they could see the benefit, so they asked to be part of it. We've now made them part of it, and I expect — I know from talking to people at IFC — that that's a big business opportunity that they're going to be looking to secure and bring to British Columbia. Again, it creates all sorts of activity. It creates all sorts of people that are in that industry, and it starts to create some critical mass. It's a huge opportunity for us as well.
P. Sahota: I just have a couple of questions for the minister. By introducing the balanced budget this year, I really do believe we have signalled that this province is living within its means. Having said that, I would like to get the minister's thoughts in terms of what further restructuring is to take place in the coming year in terms of programs and government services.
Hon. G. Collins: As I said on budget day during the lockup, if you look at the three-year service plan, of which we're about to enter the third year, you will
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know that there was money put aside in the budget in the first year and the second year for restructuring: the costs of getting out of leases, of reducing the size of the public service, etc. — severance and pensions and those kinds of things. We told ministries that you needed to reduce your costs and be down at your costs and complete your cost reductions by the end of the 2003-04 fiscal year. That's by the end of this month.
Virtually all ministries will have completed — if not in their entirety then certainly to the greatest extent possible — the spending reductions that were in their service plans by the end of this month. There will be a little bit that may spill over into next year, but not a lot, and so the spending reductions across government have essentially been completed.
That doesn't mean there's not going to be lots of change. I mean, the health care budget's gone up 30 percent in the last three years or so. There's big change happening there and big restructuring happening. Education as well — the number of students is coming down. That's driving decisions in school districts to perhaps close schools and centralize resources better and make better use of those resources. At the same time, the per-pupil is going up and overall funding is going up. There's still going to be change happening in education — advanced ed as well.
The spending reductions for government are essentially complete, but there will be lots of ongoing restructuring. I actually think the world's changing on an ongoing basis, and so there'll continue to be restructuring, probably forever.
P. Sahota: My second question is related to future priorities. I recently met with the motion picture industry and the Canadian Bar Association. I'm sure the minister is well aware of their concerns in terms of future tax policies. I was wondering if I could get his thoughts in terms of some of the future priorities the government has been looking at. I'm talking about future priorities in terms of the motion picture industry, in terms of the Canadian Bar Association. I'm aware they've met with the minister. I was wondering what your thoughts were on some of their proposals they've put forward to you.
Hon. G. Collins: PST is the issue that both of them brought to me. We continue to try to review those on an ongoing basis. I think they both make some legitimate points. The question is nobody likes any tax. These two parties don't like the tax they pay, but that's part of the review on an ongoing basis. We'll continue to consider that.
Vote 22 approved.
Hon. G. Collins: I have a number of other votes. I'll try and move very quickly because I know the other House is awaiting us.
Vote 23: Public Sector Employers Council, $14,693,000 — approved.
Vote 39: management of public funds and debt, $800,000,000 — approved.
Vote 40: contingencies (all ministries) and new programs, $240,000,000 — approved.
Vote 41: B.C. family bonus, $59,000,000 — approved.
Vote 43: commissions on collection of public funds, $1,000 — approved.
Vote 44: allowances for doubtful revenue accounts, $1,000 — approved.
Hon. G. Collins: I move that the committee stand recessed until 6:35 p.m.
The committee recessed from 5:59 p.m. to 6:36 p.m.
[H. Long in the chair.]
ESTIMATES: MINISTRY OF
On vote 30: ministry operations, $52,279,000.
Hon. R. Thorpe: I'm pleased to introduce the estimates for the Ministry of Provincial Revenue for the fiscal year 2004-05. First of all, I'd like to introduce some ministry staff from our offices that are with me tonight: my deputy minister, Chris Trumpy; assistant deputy minister Greg Reimer; and our senior financial officer, Ranbir Parmar. I'd also like to acknowledge the hard work and efforts of other members of the ministry: assistant deputy minister Lloyd Munro, from the strategic initiatives and administration division; Janet Baltes, executive director, collection and loan management branch; and Howard Thompson, executive director, special projects.
I want to thank everyone who works on our team for their efforts in producing our budget and our estimates this year. Their skill, dedication and professionalism are the reason the ministry has become a centre of excellence in government revenue collection and a leader in tax administration in Canada. I am proud of the work they do, and I thank them for their ongoing support. Their work in this ministry is very important to the success of government's commitment to restoring sound fiscal management in British Columbia.
The Ministry of Provincial Revenue administers the collection of taxes and other revenues that support vital government programs such as health care and education. This includes taxes on income, property and retail sales, as well as revenue from natural resource extraction. My ministry is also responsible for debt administration and the collection of accounts receivable owed to government, including MSP premiums and student loans. It provides loan management services and ad-
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ministers the homeowner grant program, which assists thousands of British Columbia homeowners.
In the fiscal year just ending we expect to collect and manage combined gross revenues in excess of $16 billion. I should point out that the ability of the ministry to achieve its revenue collection targets is somewhat dependent on the economy. I am very encouraged by a number of positive economic signs.
Tax reductions, both personal and small business, introduced by this government have been offset by higher revenues from energy and forestry resources, property transfer tax and contributions from Crown corporations. It is expected that low interest rates will continue to buoy consumer spending, which will lead to more revenue from provincial sales tax and property transfer tax.
Housing starts are up 22 percent over the previous year, and we are running three times the national average. There's booming activity and investment in the industry sector. Revenues from the forestry industry have increased in recent years, primarily due to higher-than-expected harvest volumes. B.C. leads Canada in job creation, with 159,900 new jobs since December 2001. For the first time in six years, more people are moving to British Columbia than leaving.
Our mission is to collect revenues in a fair, efficient and equitable manner to support the public services that meet the needs of British Columbians — services like health care, for which our government is increasing annual funding by an additional $1 billion by 2006-07; services like education, where spending will rise by $313,000 for K-to-12 and $105 million for advanced education.
To ensure the province collects the revenues to support these priorities, our service plan sets out five important goals: (1) maximize voluntary compliance; (2) collection of all outstanding amounts owed to government; (3) fair, efficient and equitable administration that meets taxpayers' needs; (4) continuous performance improvement and accountability; and (5) support highly skilled, motivated and innovative employees. I'd like to speak briefly about those goals and why they are important to the success of government's strategic plan for a strong and vibrant provincial economy.
Our first goal is maximizing voluntary compliance. It's important, because voluntary compliance is the best and most efficient means of collecting revenue and debt, and it avoids the complexities and the expense of having to enforce payment. We encourage voluntary compliance through excellence in customer service, easily accessible information, new electronic services, clear regulations and reduced red tape.
For example, we're using the Internet to provide the latest policy updates and tax bulletins to taxpayers. The ministry's Internet sites attract nearly half a million visitors during the year, well exceeding our annual targets. We're expanding Internet and telephone banking opportunities for rural property tax customers, resulting in a significant increase in revenues. We're working together with other governments and industry associations, such as the Revenue Programs Advisory Committee, to come up with innovative solutions for common revenue taxation issues. We have set a target this year to collect 97 percent of revenue without enforcement action. To support voluntary compliance, the ministry also undertakes audit and enforcement activities.
Our second goal of collection of all outstanding amounts owed to the government is an important part of our commitment to sound fiscal management. British Columbia's overdue accounts receivable have grown by 40 percent in five years. There are several reasons for this. First, following the recommendations of the auditor general and changes to the comptroller general's reporting requirements, ministries are now able to better identify and report their accounts receivable. Overdue balances for MSP premiums have increased, in part because of increased enrolment where the taxpayer is directly responsible for payment. The value of the student loan portfolio has doubled after the province started funding student loans directly in August 2002.
To give you a snapshot of the size of overdue accounts receivable, at the end of December there was $815 million overdue. Letting this debt go uncollected is unfair to those who do meet their obligations. That's why in the coming year our goal is to reduce our accounts receivable by at least 2 percent, and we will reduce it further in years ahead. We will do this using several strategies, including improved customer service, streamlined account management and technical improvements. For example, if a taxpayer has multiple debts relating to more than one ministry, those debts will be consolidated and the taxpayer will only have to deal with one collector, who can work with them to ensure the debt is paid.
We've streamlined the process for handling undeliverable collection letters. A bar code has been entered on all collection letters. When returned as undeliverable, they are scanned, collection letters are updated, and the accounts are sorted into skip tracing priority. To ensure that all money owed to the government is properly collected, we are increasing the number of audits this year. The revenue identified through these audits and the deterrent effect of comprehensive auditing programs will help the ministry reach its revenue goals.
Speaking of audits, I'd like to take a moment to describe our approach. Like all governments, we routinely perform audits to determine if there are taxes owing. The minister has global targets for revenue collection. However, auditors do not have specific dollar targets. There are no quotas. Auditors' performance is measured in a number of ways, not the least of which is the auditor's ability to treat taxpayers with professionalism, fairness and respect.
We do quarterly surveys of consumption tax audits to assess our performance. The vast majority say they are satisfied with the way their audit was carried out and with the service they received from ministry staff. These taxpayers describe the audit process as fair, dis-
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creet and informative. Taxpayers consistently find their auditors very personable, reasonable and easy to work with, a testament to the professional customer service–oriented individuals this ministry strives to develop.
I am very pleased with the results of post-audit questionnaires filled out by taxpayers: 96 percent said they received an adequate explanation as to why they were audited, 95 percent said the results of the audit were adequately reviewed and explained, 96 percent said they have adequate opportunity to explain their position, and 86 percent said that as a result of the audit, they now have a better understanding of the legislation administered in relationship to their business.
This brings me to our third goal: meeting customer needs through fair, efficient and equitable administration. We know it is important to ease the administrative burden on customers as part of our government's drive to enhance the business climate of British Columbia. In the coming year I will visit regions across British Columbia, holding small business round tables to hear first hand how we can work together.
We know that our clients need simplified regulations and streamlined processes. That's why we're committed to speeding up the tax appeal process. My ministry is also fully supportive of government's deregulation initiative. To date, my ministry has reduced the number of its regulations more than 13,000, to less than 11,000 — a reduction of 21 percent.
Our fourth goal, continuous performance improvement and accountability, encompasses a major initiative during the coming year. The revenue management project is a key priority for the ministry this year. Right now accounts receivable are spread over 40 branches of government. We're working to consolidate many of these accounts receivable functions and to transfer them to the Ministry of Provincial Revenue in the coming years as this large-scale project progresses.
To ensure we capture all the savings and efficiencies these transfers would bring, we have launched the revenue management project. The project will bring together account management, billing, payment processing and collection. All of these will be brought into one set of consistent business processes. The ministry is currently negotiating with EDS Canada to embark upon this multi-year project. The ministry is currently engaged in due diligence work with the EDS team of information systems billing and remittance processes and the proposed revenue management technology. The revenue management project will involve customer service centres, private sector–style customer relationship management and electronic service delivery.
The goal is increasing government's bottom line, transferring risk and ensuring we have flexibility to provide services in the future. Improvements will come from a variety of areas, such as lowering the accounts receivable balance, reducing bad debt, avoiding the cost of replacing expensive IT systems and providing a timely approach to customer service. As we work to implement the revenue management project, we are working in consultation with our employees and the union, keeping both employees and union updated as we move forward.
Our fifth and final goal is to support innovation and foster a highly skilled and motivated workforce. We have a very dedicated staff with very high morale. Close to one-quarter of our employees were recognized this year for their exemplary dedication and service to their work. I've only been working with the Ministry of Provincial Revenue for a very short time, and I am very, very impressed with their commitment to excellence and innovation.
For example, IT specialists with the information systems branch and staff from the collection and loan management branch were recognized for their success in developing and implementing the immigrant sponsorship debt recovery project. The project has enabled us to proceed on collecting $34 million in outstanding debt. The billing and receivables branch expanded payment opportunities and made it possible for customers to pay by preauthorized debit for Medical Services Plan premiums. There was a 10 percent takeup in the first six months. The revenue programs division staff worked with the Ministry of Finance tax policy branch to design a program to provide independent schools with benefits comparable to a provincial sales tax refund provided to the public school parent advisory councils.
Our employees are constantly developing their skills and finding innovative ways to share their knowledge. The revenue programs division created an innovative on-line employee development learning plan system. It helps employees identify skills gaps and training needs and allows the ministry to use training funds more efficiently. This innovative system is now copyrighted. Our non-accounting employees will soon have the opportunity to obtain formal accreditation through ministry development and sponsorship of the revenue management certificate program with Camosun College.
The building and receivables branch created a staff learning community: learner-led sessions and brown bag lunch-hour sessions that create informal learning opportunities for all staff. These sessions help employees at every level to work together to identify ways to streamline processes, improve customer service and share their knowledge. I am very proud that this passion for learning and professional development is leading to innovative solutions and supporting the achievements of the ministry's goal.
In summary, this ministry was set up under the vision of the Premier. My goal is to continue the excellent work of my colleague the member for Penticton–Okanagan Valley. We will continue to consolidate government revenue collection in a way that makes sense to taxpayers and that serves British Columbia. We will continue to strive to create efficiencies and savings. We are striving to provide excellent customer service.
I look forward to your questions.
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B. Penner: I'd like to thank the minister for his opening remarks. During those remarks I heard him comment about fairness and how it is only fair to make sure we collect from those people who properly owe money to government. I couldn't agree more.
I'm going to just focus on one issue, Mr. Chair. That has to do with unpaid provincial fines for various tickets that have been issued, as I said, under provincial offences. Many of us will know that when you are caught speeding, if that should happen to you, and if you choose not to pay your fine immediately, you will be reminded of the fact that you failed to pay your fine when it comes time to renew your driver's licence. You will not get your driver's licence renewed unless you pay the fine that's outstanding if that has been tracked against your driver's licence.
Sadly, however, that's not the case for the vast majority of provincial offence tickets. Back when I, once upon a time, worked as a park ranger, we often thought amongst ourselves: "Why doesn't the provincial government implement a policy of collecting against Park Act fines, liquor act fines, Litter Act fines, Wildlife Act fines and make sure all that revenue gets collected from people who have chosen to break the law and who may be reluctant to pay the fine voluntarily?"
Back before Christmas I wrote to the previous Minister of Provincial Revenue. In January I received a response from a Deborah Fayad, a director from the Ministry of Provincial Revenue, who attached an interesting schedule. What this indicated was that where the provincial government does have in place a mechanism for tracking unpaid provincial fines against motor vehicle licences, 85 percent of the fines are paid within one year. Where we don't do that, however, only 32 percent of the fines levied are collected each year.
The practical impact on the ground is this: the offenders know they can get away with littering, smashing beer bottles, causing damage in parks, stealing from parks, causing whatever mayhem out on the rivers, not bothering to get a fishing licence. Conservation officers, police officers, park rangers and other law enforcement types are demoralized in terms of actually enforcing the provincial statutes that are in place, because they know there's not going to be any practical effect. It's very demoralizing for law enforcement officials to know that there's no practical impact as a result of their investigative efforts.
J. MacPhail: I agree.
B. Penner: I know the Leader of the Opposition agrees with that.
When I meet with people who are out in the field attempting to uphold the laws of British Columbia, I'm asked repeatedly: "Why doesn't the provincial government take advantage of the opportunity to collect some extra revenue, make sure that people who choose voluntarily to break the law are held accountable and do something to improve our morale and maybe give us more resources to spend on enforcement?"
Just in closing, before I sit down, I'll just rattle off some of the collection statistics that I was provided with for the year 2000. It shows, for example, that under the Forest Act, $28,831 in fines was assessed and only $11,129 was collected. That's pretty good compared to the Liquor Control and Licensing Act, where almost a million dollars in fines was assessed in one year, and $631,572 went uncollected, for a collection success rate of only 33 percent. That's a lot of money left on the table.
One that jumps out at me is the Litter Act. Unless it's a typo, this document indicates that zero dollars in fines were assessed under the Litter Act in the year 2000, despite all the signs on the sides of highways threatening up to $2,000 fines for littering. In real terms, in the year 2000 zero dollars were actually assessed and, of course, zero dollars were collected. I think that indicates that in fact law enforcement officials have been discouraged from issuing these tickets, because they know that the offenders know there is no practical impact if you don't pay your fine. One conservation officer told me last August that he has stopped writing these tickets, because writing the ticket in itself contributes to litter — the offenders will just throw it way into the creek or the campsite.
I look forward to hearing a response from the minister.
Hon. R. Thorpe: Thank you, member. First of all, the note I think you got back with the attachment comes from the AG's department. What we are doing, and you have our commitment, is consolidating collection from 40 different sources, so far, in government. We are looking at other opportunities that make sense. We're doing that on an incremental basis. We will follow up on these items that the member has brought, and we will report back to you within 30 days on what we might be able to do to address the issue you brought forward here today.
D. Jarvis: I wanted to ask just one question in regard to the property purchase tax. It pertains to an area down in the False Creek area of Vancouver, the whole Expo lands, where many of those large towers were built down on…. Unfortunately, my papers are not here in front of me to give you the exact location, but it is one of those two or three apartments that were built down on Marine View Way, or whatever they call the name of the street.
J. MacPhail: Marina Side.
D. Jarvis: Marina Side? Okay. Thank you.
J. MacPhail: It's not West Vancouver, I know.
D. Jarvis: No, I know it's not West Vancouver, but it's Vancouver. And fair enough — that's a nice little town.
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People have written to me with regard to how all of them, in one tower building, received an audit. It is strange, if you are going to do a little audit, that you'd do a whole apartment block. These are large towers, and I can only assume the other ones in the other places did audits and were contacted as well.
The question that comes to mind is the fact that in this letter of audit it refers to their having to send some questionnaire or papers proving what they purchased it for, what relationship they had to the builder, etc. This one case I had, which I have the information in my office on, was that they bought it two and a half years ago. They've occupied it almost one year now. Suddenly, they get an audit from your department saying that we're enquiring with regard to the property purchase tax, relating to the fact that the property purchase tax is based on what the assessment is at the time of closing the deal. We know, if he bought it, that they put their money down and were agreeable to buy two and a half years ago, and then they occupied it about ten months to a year ago. They obviously have paid their property purchase tax and the full price of what it cost them. Yet the audit says that if they do not send this information back to us by the end of February — in other words, March 1 — you are going to reassess them with respect to their property purchase tax.
You've just finished saying that it's a fair and efficient manner that you're doing this sort of thing in, but that to me slants as retroactive taxation. I was wondering if you would care to comment on that.
Hon. R. Thorpe: First of all, as I'm sure all members are aware, I can't talk about individual cases because of confidentiality and the Freedom of Information Act.
Let me just talk about the Property Transfer Tax Act, which has been in place for a number of years. This is an issue of…. The property transfer tax is due at the date of registration, which in some instances can be much different than the date of entering into the contract to purchase. It's the actual date of registration that the property transfer liability kicks in. That's based on fair market value. That is how that legislation works. It's been in place for a number of years.
On the specifics of a particular case, if the member would like to bring those to my office, I would be pleased to have my staff check into the details. The other thing I'd like to say is — and I don't know what the time line is on the particular example that the member is talking about — on all assessments that are rendered, individuals do have the right to appeal to the minister. Those appeals are taken very, very seriously and reviewed on a very individual basis. If we're not at that stage, I would encourage the member to bring that information to my office. I'd be pleased to work with him on finding the details.
D. Jarvis: I just wanted to reiterate the fact that he has occupied the premises for ten months to a year now. You don't occupy a premise down there without having to pay all your money for the full value of that property. You also pay your property tax at that time of the closing, and it's registered in your name.
By the way, I have a letter signed by him with regard to the confidentiality aspect of it. What bothered me was the summation of that letter to him saying: "If you do not send it…." I think this is sort of mean-spirited, in a way, of our government, and we're not a mean-spirited government — not like the previous government.
The last paragraph of that letter stated that if they didn't send the information requested by March 1 — or maybe it was the end of February; I can't remember the specific date — you would go out and reassess them. They have paid their property purchase tax. They paid it a minimum of ten months ago. That's retroactive. In any event, I will make sure the full information is in your office, trusting that I'll get the information as soon as possible.
Hon. R. Thorpe: I look forward to the member bringing that information to me. The member should feel very reassured that if in fact the property transfer tax that was paid actually took place based on the registration as opposed to the date of purchase, if it was some years before, and that if it has been paid on fair market value at arm's-length transaction, then the taxpayer will have no issue. Once we have the details, we can look into that for him.
J. MacPhail: How often does the Minister of Provincial Revenue meet with the Minister of Finance? Are they regularly scheduled meetings?
Hon. R. Thorpe: I meet with the Minister of Finance when required, and there are no regularly scheduled meetings with the Minister of Finance.
J. MacPhail: Has the minister ever sat on Treasury Board and, if so, when?
Hon. R. Thorpe: I have been a member of Treasury Board since we formed government on June 5, 2001.
J. MacPhail: Are there shared services between the Ministry of Finance and the Ministry of Provincial Revenue?
Hon. R. Thorpe: Yes.
J. MacPhail: What are they?
Hon. R. Thorpe: Human resources, personnel management, communications and accounts processing.
J. MacPhail: Has the minister ever been involved in a meeting with Mr. Bornman? I think his first name is Frank. I'm sorry. I've just had one of those moments. Is it Frank?
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A Voice: Erik.
J. MacPhail: Erik. I'm sorry — Erik Bornman, the lobbyist that until recently was with Pilothouse. Has the minister ever attended a meeting in his capacity as minister where Mr. Bornman was present or where that meeting was arranged by Pilothouse?
Hon. R. Thorpe: Not to my knowledge.
J. MacPhail: I'm asking it about the minister personally, so I assume that he would either be able to answer yes or no. I don't think he has menopausal moments. I may be wrong.
A Voice: Don't be so sure.
J. MacPhail: Yeah. I can't imagine why a minister would say, "Not to my knowledge," when that's the case.
Can the minister say whether his staff, either in his previous portfolio or the current portfolio, met with any lobbyists or any people with interest in the B.C. Rail deal?
Hon. R. Thorpe: I have no recollection or no knowledge of that.
J. MacPhail: Erik Bornman. We explored a little bit of this with the Minister of Finance today. Mr. Bornman is registered as a lobbyist on several occasions, claiming that this minister — by name, not portfolio — was the reason why he was registering as a lobbyist. Of course, we did explore the possibility that the lobbyists were charging their clients for things they didn't deliver. That's a possibility. Of course, I've had quite a bit of feedback on that already from people.
Erik Bornman did mention this minister, I think, on at least three separate occasions as a person he was intent on lobbying. As the Minister of Finance pointed out, often the lobbyists don't do what they say their intent is. Has the minister, both in his previous portfolio and this, not been lobbied by Pilothouse or Mr. Erik Bornman or Mr. Brian Kieran under any circumstances?
Hon. R. Thorpe: I believe I have met with Brian Kieran, both in opposition and as a member of the government.
J. MacPhail: Can the minister remember the nature of the meeting when he was a cabinet minister?
Hon. R. Thorpe: No, I can't remember the details, but I can assure this House that I never met Pilothouse consulting with respect to the B.C. Rail partnership.
J. MacPhail: How is it that the member so assured on one point but not any other?
Hon. R. Thorpe: They have many customers.
J. MacPhail: No, no. I know that. You should see the lobbyists' registration. They — Pilothouse — are claiming a lot of success. But I'm asking the minister how it is that he's so assured. He can't remember what he met Pilothouse on or Brian Kieran, but he's so assured that it wasn't about B.C. Rail. Can he remember what it could have been about?
Hon. R. Thorpe: You know, over the years, I've met Mr. Kieran on other issues. I can't remember if it had to do with auto dealers. I can't remember if it had to do with the breweries. I can't recollect the details of that, but I do know that I did not meet with them with respect to the B.C. Rail partnership.
J. MacPhail: The minister is a member of Treasury Board. Can he recollect when the B.C. Rail deal, the sale of B.C. Rail, came to Treasury Board? The Minister of Finance couldn't remember.
Hon. R. Thorpe: As the member should know — I'm sure she served on Treasury Board before — it's confidential.
J. MacPhail: Well, I don't think decisions out of Treasury Board are confidential. Call me wrong. I can't get an answer from anybody in government about when the decision was made to accept the deal around B.C. Rail. The Minister of Finance couldn't tell me. He could not tell me whether it had even been to Treasury Board. I have evidence from the former Minister of Transportation that the final deal didn't go to cabinet before the announcement was made.
I'm not asking for details about what Treasury Board did but when they discussed and decided the B.C. Rail deal.
Hon. R. Thorpe: I'll answer that question as I did before. The member knows very well that what takes place in Treasury Board is confidential, and I will not disclose confidential information.
J. MacPhail: Okay. Is it confidential — the information that Treasury Board looked at the B.C. Rail deal? Is that confidential?
Hon. R. Thorpe: I take everything that appears before Treasury Board as confidential. That's the way I conduct myself. I would be surprised if that's not the way the member conducted herself when she was on Treasury Board.
J. MacPhail: I find it curious, extremely curious, how the members of government now are comparing themselves, as the standard they like to meet, with the previous government. I'm flattered. I have to tell you I am flattered that I'm setting the standard, as my time in government, of what this government is doing.
Where is it that information about what Treasury Board decides — not how they decide — or when they
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approach an issue is confidential? I'm just trying to find an answer from someone on Treasury Board that the deal went to Treasury Board. The Minister of Finance couldn't tell me. This minister, sitting on Treasury Board, won't tell me. So I have an obfuscator, and I have a person who actually chairs Treasury Board who doesn't know.
I'm going to ask every member of Treasury Board this. It seems ridiculous that this government won't even answer about when the decision was made or what kind of fiscal overview they did around the deal. Where does the fiduciary responsibility lie within executive council on this matter, then?
Hon. R. Thorpe: I'm here to discuss the estimates of Provincial Revenue for the year 2004-05. I would more than welcome answering questions about that. Questions related to Treasury Board and the operations of Treasury Board should have been directed to the Minister of Finance.
J. MacPhail: I did. He couldn't answer them. Believe you me, it's entirely appropriate to ask this minister questions of all of his government responsibility, his ministerial responsibility.
Has the minister ever met with anyone outside government to discuss the B.C. Rail sale?
Hon. R. Thorpe: Chair, I'm here to discuss the estimates of the Ministry of Provincial Revenue for the year 2004-05, and I look forward to those questions.
J. MacPhail: Has the minister ever met with anyone outside of government to discuss the B.C. Rail sale?
Hon. R. Thorpe: For the last time, I am here to answer questions, through you, from the members of this House with respect to the estimates for Provincial Revenue for the year 2004-05, and I look forward to those questions.
J. MacPhail: How does my question preclude your answering my question? What in the minister's responsibilities or lack thereof precludes him from answering my question?
I find it unbelievable that this minister, executive council, member of Treasury Board, will not answer my question. What's to hide? I don't understand what's to hide. Is there something wrong with meeting with someone outside of government on the B.C. Rail deal? Is there something untoward? I'm not in any way suggesting there's something untoward. I just want to know what happened.
Believe you me, Mr. Chair, the fact that this minister refuses to answer a straight-up question about his role as executive council and member of Treasury Board and the minister that shares services with the Minister of Finance…. He refuses to answer the question.
Let me ask this. Perhaps this senior member of the executive council could advise me when I am allowed to ask him questions of this nature.
Hon. R. Thorpe: I would be very, very pleased to have the member, and all members of this House, ask any question they want that pertains to the estimates related to the Ministry of Provincial Revenue for the year 2004-05.
J. MacPhail: Is the minister responsible for tax collection in this province?
Hon. R. Thorpe: Yes.
J. MacPhail: Part of the B.C. Rail deal is about a $255 million tax arrangement that may or may not be collected. Is the minister aware of that?
Hon. R. Thorpe: That's tax policy, the responsibility of the Minister of Finance.
J. MacPhail: No, in fact the Minister of Finance wouldn't answer questions on that either. He said it was a bookkeeping arrangement.
I think this minister is responsible for accounting in this government — for tax collection. Is the minister aware of what happens if that indemnity can't be honoured by the federal government? What happens then?
Hon. R. Thorpe: It's a question of tax policy, and it should have been asked of the Minister of Finance.
J. MacPhail: I don't understand why the minister is obfuscating and stonewalling on this matter.
If the $255 million, the tax policy initiative of this government, falls through, who is responsible for collecting or not collecting that tax? Is it this minister?
Hon. R. Thorpe: The Canada Revenue Agency is responsible for collecting corporate taxes for the province of British Columbia.
J. MacPhail: Who in this government, in the executive council, is in charge of making sure that happens? Is it the Minister of Finance or is it the Minister of Provincial Revenue?
Hon. R. Thorpe: It's the Minister of Provincial Revenue. We have a signed agreement with CRA on tax collection.
J. MacPhail: Well, it would seem to me that the minister would want to come clean on the fact that one-quarter of the B.C. Rail deal involves tax collection or tax expenditure with CRA. He's directly involved in ensuring the success of this deal one way or the other. Is that why he doesn't want to answer any questions about whether he's met with anyone outside government on the B.C. Rail deal?
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Well, I guess I do have a couple of other avenues where I could ask the minister these questions, Mr. Chair. I can ask him in question period, where he can't obfuscate — or maybe he can; that wouldn't be a surprise — or I can FOI information, or I can send him a letter. He should probably look forward to all three. It is simply ridiculous. In fact, the minister has probably got himself in more hot water by refusing to answer.
The Canadian Federation of Independent Business met with us in a regular meeting. It's not regular enough for our liking. The Canadian Federation of Independent Business has offered us many meetings, and we were fortunate enough to be able to take one up recently where they suggested that they had a problem with the government's audit of small businesses. Has the minister met with the Canadian Federation of Independent Business on this matter?
Hon. R. Thorpe: I have, in my previous responsibilities, met with the Canadian Federation of Independent Business. As the Minister of Provincial Revenue I have not personally met with them yet. I've talked on the telephone several times. My staff meet with them on a very regular basis. They are participating with us in a sales tax forum and tax administration forum on March 12 in Vancouver.
J. MacPhail: This has to do with auditing small businesses. Is the minister saying this sales tax forum will address the concerns they have around auditors coming into small businesses?
Hon. R. Thorpe: We have a formal revenue program advisory committee, of which CFIB is a very willing and active participant with some 20-something other organizations. We meet formally twice a year. We then meet off line with all of these organizations to understand the issues that are impacting their members. One of the things this ministry is very proud of is our approach to customer service, our approach to working with people, our approach to simplifying and streamlining processes. We know, unlike the previous government, that the key to success of the province of British Columbia is the viability of small business.
J. MacPhail: How many auditors are in the minister's department now?
Hon. R. Thorpe: Approximately 230.
J. MacPhail: How have those FTEs changed from '01-02 through to '04-05?
Hon. R. Thorpe: We do not have that detailed information, but I'll undertake to get it to the member for next week.
J. MacPhail: What is the target…? What is the success rate, not the target, of auditors in terms of cost benefits of that number of auditors?
Hon. R. Thorpe: There are no individual targets for auditors.
J. MacPhail: Yes, I changed my…. I said cost benefits. What is the cost of the 200-odd auditors, and how much do they collect?
Hon. R. Thorpe: The ratio is a cost benefit of 5 to 1.
J. MacPhail: Has that remained steady over the years or increased? Does the extra…? Well, let me ask that question first.
Hon. R. Thorpe: We don't actually have that detailed information with us, but over the past five years the returns have increased to the province.
J. MacPhail: Is it, in other words, that the cost-benefit ratio has increased or that the actual amount of taxes has increased? Here's where I'm going. The Canadian Federation of Independent Business makes a point — and I have no idea of the origin of their concern — that there seem to be more audits of small businesses going on now, and they are getting more complaints about the intrusive and sometimes — this is not their word, but I sensed it was — abusive nature of the audits.
I'm trying to figure out if there is a cost benefit to the increased number of audits in terms of an increased ratio of return. Or is it just that there is more money being collected because you're putting more auditors into the field and the cost benefit remains the same?
Hon. R. Thorpe: Over the past five years, through technology and other advancements, it's my understanding that auditors have been given better tools to do their jobs. They also have more sophisticated methods for targeting at-risk tax issues, which have resulted in the increase in the cost-benefit ratios.
J. MacPhail: Then I assume, even though the minister hasn't been able to provide me the information over the last five years, that he will be able to provide that in terms of the increased cost-benefit ratio. Is that correct?
Hon. R. Thorpe: Yes. If the member wanted to send me a note, just a little handwritten note with exactly what she would like, I'd be pleased to provide that.
J. MacPhail: What I want is the number of auditors and how much money they raise for the government and what that has been over the course of the last five years — how many auditors per fiscal and how much money raised.
I was curious to know why, in the small business sector, the government hasn't gone along with cutting red tape and deregulation and a results-based approach that they're allowing in the mining industry and in the forest industry. Why isn't that premise applied to small business?
[ Page 9074 ]
Hon. R. Thorpe: It is.
J. MacPhail: Then, as Minister of Provincial Revenue, how many auditors are assigned to the forest sector, and how many auditors are assigned to the mining sector?
Hon. R. Thorpe: We do not have auditors, as I understand, that target in specific areas. They have areas of expertise, and they go across a large sector, whether it be in sales tax or capital tax. They apply that expertise across the entire sector of businesses in British Columbia.
J. MacPhail: Has the ministry got it broken down in terms of the revenues collected by the auditors according to sector?
Hon. R. Thorpe: I don't have that information with me, but I will check. If we do have it, I will provide it to the member with the details of the other questions.
J. MacPhail: Yes, I'd like that. I assume that if the minister is standing up and saying that the same results-based approach, which this government brought in, that exists in the mining and forest sectors also exists in small business, he'd be able to back it up with some facts. That's why I ask the question.
Hon. R. Thorpe: Let me just say to the member and to all members of this House: our government, unlike previous governments that were in British Columbia for ten years, actually cares about and understands small business. I take exception to that member's comments that she made about the style and manner of our auditors when in fact she said she was paraphrasing or characterizing the comments. I actually take exception on behalf of our employees, who work very, very hard in doing their work throughout the province.
Perhaps if the member had been listening when I gave my opening comments, she would have heard that I will be visiting small businesses throughout and around British Columbia in the coming year to understand their issues, to ensure that we are working with them, to ensure that we have simplified and streamlined methods of doing business. Unlike the previous government, we actually know that small business is the backbone of the province. I'm surprised that the member even knows what CFIB is.
M. Hunter: I want to say to this minister that he's very near and dear to my heart. That's because my wallet is kept close to that place. I think about him very frequently as I reach for my wallet.
J. MacPhail: You prefer the finances of the province today?
M. Hunter: Yeah, I do, actually.
I've got a couple of areas of questioning I'd like to pursue. The first is with respect….
J. MacPhail: You're going to be in question period tomorrow, are you?
The Chair: The member for Nanaimo has the floor.
M. Hunter: I wanted to ask a question which has implications for 580 taxpayers in B.C. as I understand it. Earlier this week a constituent of mine, with some alarm, was told that she would receive an — I believe it's a T5077 or T5007; I can't remember which — income tax report for work she does for kids in her care. Post-adoptive assisted parents, I believe, is the name of the program. The implications of the province being required to report payments made to this individual and 579 others were quite dramatic according to her. Can the minister tell me what has happened? I believe there have been some discussions with CRA. Can the minister tell me what's happened in that case?
Hon. R. Thorpe: Thanks to the member for that question.
My staff have reviewed the requirements for issuing T5s together with Children and Family Development and the CRA and have concluded that they will not be required. This is consistent with the procedure in other provinces. It's my understanding that a clarification letter is going to be sent out to adoptive families in British Columbia, and we regret any difficulty caused to these families. Of course, since this is a program that deals directly with Children and Family Development in British Columbia, detailed questions on that would be best directed to the Minister of Children and Family Development.
M. Hunter: That is indeed good news for 580 post-adoptive parents in British Columbia. It leads me to my next couple of questions.
The Canada Revenue Agency is an organization which is also near and dear to all our hearts, I'm sure. One of the things the Canada Revenue Agency does have, though, is a taxpayers' charter of rights. I wonder if the minister can tell me whether or not British Columbia or his ministry is prepared to look at the adoption of a similar charter of rights for British Columbia taxpayers.
Hon. R. Thorpe: We would be very willing to and would welcome any input the member would have in this regard. We'd be very pleased to look at that. I'd also just like to let this particular member know that in our ministry's commitment to customer service, we will be doing a customer outreach program on sales tax in Nanaimo in the very near future, working again with small business so that they understand the issues and we understand their issues and so that we can make some progress together. It is part of a pilot program, and we're pleased to be working in the community of Nanaimo on this project.
[ Page 9075 ]
M. Hunter: Thank you to the minister for that offer of working toward some kind of clear charter for taxpayers. I will take him up on that.
I can tell the minister that the workshop in Nanaimo, the reaching out to businesses, has already…. I've talked to the chamber of commerce, and I think we're going to have a pretty good reception for that event. I'm grateful that my community was chosen as one place that's going to happen.
I do want to follow up on some of what the Leader of the Opposition was talking about in terms of audits. I think many of us have had individual businesses complain. Indeed, I have spoken to one of the officials in the ministry about this issue. I don't want to pursue individual cases. That's not my purpose. I do believe that auditors generally are trying to do a good job.
I do want to ask the minister: when complaints do happen — and I know they do, because I have a couple of things I need to pursue — what kind of quality control do we have in place? What kind of training are we providing our auditors? What actually happens if a complaint is lodged with the ministry? What steps do you pursue to make sure the taxpayer is being treated fairly and that the revenue is being collected in a manner that reflects the needs of the business?
Hon. R. Thorpe: Let me first of all say that I've been the Minister of Provincial Revenue for a very brief period of time. The one thing that has impressed me right off the get-go, having visited a number of our offices, meeting staff and my executive group is that I am very, very pleased with their professional approach.
With respect to our audits, we have professional accountants. We hire professional accountants. They have internal training programs that take place before they go out to the field. When they perform an audit, those audits are reviewed by a manager before results go out to the field. If we have any complaints about people's attitudes to the audit, we take the very serious ones — depending, obviously, on the level of the concern it raises in the organization — to the assistant deputy minister and to the deputy minister. We also conduct quarterly surveys where audits have been done and ask people to send that information in to us. Those concerns are addressed and acted upon.
Let me also say one of the things I said to my executive group when I became the minister here. The words I think are very important from my office are that we have to have a customer service approach to dealing with the taxpayers of British Columbia. When letters or phone calls come into my office, they are dealt with promptly by my staff. We take every concern very, very seriously.
There is a review process before assessments. When assessments are issued, taxpayers in British Columbia have the right to appeal directly to the minister. Those appeals are reviewed by the minister. The outcome, of course, on individual cases is confidential. If people still are not pleased with the outcome of reviews by the minister, then they have the right to take those to the courts of British Columbia. We take customer service and approach to customer service very, very seriously. We are learning, adapting and adjusting every day, based on the experiences we encounter in British Columbia.
M. Hunter: I would like to thank the minister for that response. I'm particularly interested in the adaptability he talked about at the last. I think that's very important, because as technology changes, as new industries develop…. I guess aquaculture is a good one.
I have a case right now where an individual has had some difficulty. Auditors, who are trained to look at a series of numbers, perhaps sometimes are technologically challenged. It's no fault of their own, and I don't mean that in a demeaning kind of way.
I am interested in how the ministry deals with new technology, the technical advice that might determine whether or not a particular item is subject…. I'm talking about the PST.
If I may, while I have the floor, I'd like to ask the minister if he can tell me if there is a count on how many interpretation bulletins and guidelines that exist within our PST regime. It seems to me that the more exemptions and the more flexibility an auditor has, the more chance there is that you could actually find an arguable point when you're going through any particular business's PST accounts and doing an audit on that.
In the spirit of the fairness and thoroughness he's talked about, I'd be interested in knowing how much paperwork we actually have that people have to comply with. Can he answer me on this issue of training and technical advice that an auditor might get going into a specialized operation on PST?
Hon. R. Thorpe: Thank you very much for that question. Let me first of all say that our ministry works very closely with the aquaculture association. In fact, the list of exemptions the industry has is worked in cooperation. They come forward with their thoughts and plans and wishes, quite frankly. That then is taken to the Minister of Finance as part of an annual planning process. It's reviewed at that point in time, and a decision is made.
With respect to auditors understanding what's exempt and what's not and how they understand it, we take tours. We have a digital photo library so people actually know what a certain item may be. We are willing and able to meet with the association on an ongoing basis to develop a better understanding — them a better understanding of us; us a better understanding of their business.
We have about 120 consumer tax bulletins in British Columbia. If the member has any need for myself, my senior staff or our field staff to work with the industry on a particular issue, we are more than pleased to do that.
[ Page 9076 ]
M. Hunter: That gracious offer has been made by your officials. It's just that I don't have enough time to pursue some of these issues — but I will.
Just a couple of issues on federal-provincial taxation kind of relationships. Does British Columbia automatically grant the same personal income tax deductions that Canada does? When I fill in my T4, are those deductions automatically accepted by British Columbia — union dues or professional income, that kind of thing? Do we follow the same rules as CRA?
Hon. R. Thorpe: We follow the same rules on the net income side as Canada does. With respect to the deductions side, British Columbia has the ability to establish its own deductions, should it wish to do so, in a particular area. That is part of tax policy administered by the Minister of Finance.
M. Hunter: My last question has to with how British Columbia audits or checks that taxes collected by CRA on our behalf are actually remitted back to B.C. What system do you have in place to ensure we are getting our fair share back from Ottawa?
Hon. R. Thorpe: That's a very interesting question. I'm meeting tomorrow morning at 8 o'clock with the federal Minister of National Revenue in Vancouver to go over a number of issues.
British Columbia has been identified in Canada, and British Columbia, under these folks, has taken a leadership position in working with CRA to ensure that British Columbia is getting its fair and equitable share. My assistant deputy minister here co-chairs a joint committee with Canada on ensuring that British Columbia is getting its share. We have gone through a number of programs with respect to income allocation to the province from a corporate tax point of view, which has been very beneficial to British Columbia in making sure it gets its fair share.
We've also gone through over the past couple of years a T1 residency review of folks that were actually living in British Columbia but perhaps filing their taxes as if they were living somewhere else. I know that's hard to believe. In that program over the past two years I believe we've had $25 million accrue to the taxpayers of British Columbia.
We work very closely with them. We have been identified and will continue to work very hard to ensure that British Columbia is leading in this area in working with CRA. We have an excellent working relationship with CRA, but we will continue to lead to ensure that British Columbia gets its fair and equitable share of Canadian taxes.
D. MacKay: First of all, a comment on the percentage of recovery of taxes due to the province. It's quite remarkable, given the population base and the problems in collecting it. I think it's certainly a credit to the staff that collect those. I think you said 98 percent of the taxes due are in fact collected.
That begs the question on audits. Does the Provincial Revenue ministry work in conjunction with other ministries, such as natural resource ministries? Do you work in concert with them in any way?
Hon. R. Thorpe: In our ministry we have the mineral, oil and gas revenue branch that looks after revenues from that area. We also have forestry revenue that we look after. Therefore, as part of that whole process, we work very closely with Energy and Mines and also with the Ministry of Forests.
D. MacKay: Taking that response to my question, then, what would trigger an audit? When I look at the budgets of each of those natural resource ministries…. I think the minister said he works in concert with oil and gas. There's the Columbia River Treaty. There are forest and water resources. Let's say we're going to use forestry for the year 2003-04, where $697 million was budgeted by the ministry. If and in fact it comes in under budget, would that trigger an audit of the forest sector, per se?
Hon. R. Thorpe: No, that wouldn't. In fact, what we do is through a variety of sources…. I'll just stay on forestry, if I can. If we had a forestry organization or industry related to forestry that we, through our various processes, thought was perhaps buying materials or products outside the province and not paying the sales tax due, we would then target them and conduct audits on that. Whatever the results would be, that's how we would work — that way.
D. MacKay: My understanding is if a ministry comes in under budget, that means the province is now short some revenue needed to meet its financial commitments. I go back to forestry again, where we came in $50 million under budget. There's a reason for that coming in under budget; there could be a variety of reasons. It would not trigger an audit on the forest sector.
Hon. R. Thorpe: I'm not exactly sure of the number the member over there is talking about, but it sounds like it's stumpage revenue to me. We are in the collections business. That's where we go. We are in the audit business. Our business isn't driven by the fact that their stumpage revenue may be down. Our ministry is driven by what is due to the province, and then obviously through tax audits, if people have been avoiding taxes or not paying the appropriate taxes, that's where we would make an assessment.
Chair, I was wondering if we could maybe have a three-minute recess.
The Chair: The committee will stand recessed for three minutes.
The committee recessed from 7:57 p.m. to 7:59 p.m.
[H. Long in the chair.]
[ Page 9077 ]
On vote 30 (continued).
B. Lekstrom: I have a couple of questions related primarily to my area in the northeast part of the province — the challenges we face being as close as we are to the border with Alberta.
He's touched on it in a couple of his answers already this evening, but can the minister tell me, when our companies are competing with companies from right across the country — and I'm focusing, really, on the Alberta contractor coming into the province — how does our government, how does your ministry ensure the taxes are collected? Do we have auditors that actually go cross border outside of British Columbia to look into the books of some of these companies that are doing business in B.C.?
Hon. R. Thorpe: Chair, the simple answer is yes, but let me give him some detail. Not only has this member for Peace River South, but the member for Peace River North and the members in the Kootenays with respect to similar issues have raised the concern of the level playing field and who is and who is not paying the proper consumption tax in the province. Our staff take that very seriously. As the member knows, we have an office in Dawson Creek. We also have staff in Fort St. John, and we have staff in the Cranbrook area also.
Let me just tell you that in the fiscal year 2002-03, with respect to the consumption tax, we had 5,371 audits and made $95 million in assessments. Outside British Columbia we had 796 audits, or 15 percent of the audits, which yielded 35 percent, or $32.8 million. With respect to Alberta companies in 2002-03 we conducted 272 audits, or 5 percent of our total audits, which yielded us 14 percent of the revenue, $13 million.
Let me also advise that having heard the concerns from the members for Peace River South, Peace River North and other members and also in working with the business community in the Peace, which has had some concerns in the fiscal year to date, in 2003-04, we have conducted 324 audits on Alberta companies, which is 6 percent of our total audits. This has yielded us 20 percent of our assessment, or just under $20 million.
We take this very, very seriously. We understand the importance of what local businesses in Dawson Creek, Fort St. John and Fort Nelson contribute to the province. We are working together with the industry — industry associations, the companies working here — to ensure the playing field is as level as it can be. We've always said that if members of companies and associations have information for us, we are always pleased to pursue it to ensure the playing field can be as level as possible.
D. MacKay: I think I heard the minister say that it was the Minister of Provincial Revenue's responsibility to collect what is due to the province. Was that a statement? I'll follow up with that. Who is responsible for determining what is due to the province? Is it different ministries who are responsible for that?
Hon. R. Thorpe: Just continuing, I'm assuming the member is still on his forestry example there, so that's the one I'm going to follow up on.
With respect to the revenue estimates that are in the budget book, those estimates are prepared in cooperation between the Ministry of Forests and the Ministry of Finance. They reach agreement on a number. The Ministry of Forests, who issues cutting licences, then goes out and issues those licences. The timber is harvested. The Ministry of Forests issues the appropriate invoices for the moneys that are due. Those invoices are then turned over to us for collection. We do the collection, but the Ministry of Forests does the billing on stumpage and other revenues that are due to the province.
D. MacKay: I guess I should have elaborated a bit on the question and where I was hoping to go with it — more specifically, natural resources that at present are not taxed. I'm talking about the pine mushroom.
The pine mushroom in the northwest part of our province is a multimillion-dollar industry. It's cash. There is no tax paid by the people who collect the mushrooms, there's no tax collected on the middleman up there, but millions of dollars are made every year by people who collect the mushrooms and by people who ship those mushrooms offshore.
I don't know who is responsible for setting a value on the mushroom itself, or should we be taxing the export of those mushrooms only, as they're leaving the country? It's one way of tracking a resource that belongs to the people of the province. I'm not suggesting for a moment that we look back at the people who are actually collecting the mushrooms, because it's all cash. Everything is cash, and it would be difficult to track.
The idea of putting a tax on the mushrooms as they are being shipped from this country is an idea I'd like to pursue. I wondered if in fact that is being done now. If it's not, can we look at doing that in the future?
[D. Jarvis in the chair.]
Hon. R. Thorpe: First of all, a changing of the guard at the Chair, so I'll recognize both of you.
On the surface, it sounds like the question would be a Canadian Revenue Agency issue with respect to whether people are reporting their income properly or not. It sounds to me that this member has extensive knowledge of pine mushrooms and that what we should actually do is arrange, in the next week or so, a meeting with our staff to understand this issue. Then my staff would pursue that with CRA. If it's warranted that a pilot project would be required, we'd be pleased to work with the member and his constituents on this matter.
D. MacKay: In closing, I can see where I would make myself a lot of enemies with the pickers of the
[ Page 9078 ]
mushrooms if it's an income tax issue as it relates to the pickers. I'm more concerned about the value of the mushrooms being shipped and the province not really realizing any tax dollars from the mushrooms as they're being shipped out of the country. It would be very difficult to track the money in the bush.
Hon. R. Thorpe: As I said earlier, as the member appears to have extensive background and knowledge on this subject matter — not that any of them would be his constituents — we'd be pleased to meet with him and get the details and see if there's any way we could work to ensure that British Columbia is receiving its fair share.
D. Hayer: I've got one question that some of my constituents have been asking me. You know, it's been on the TV and the news about smuggled cigarettes. They were selling them all over. They're wondering what our ministry is going to do to get some of the money collected. How do you stop them so that we can get our fair share?
At the same time, they also say that sometimes the people working in some contract field or some other part provide their services for cash, and we might be losing some PST on that. Are we doing something on it? Those are the only questions I have.
[H. Long in the chair.]
Hon. R. Thorpe: I thank the member very much for that question.
Currently we have an enforcement organization whose work is primarily focused on the retail market. We have eight personnel in that area now, the tobacco enforcement team. We also have a special investigations unit that oversees provincewide investigations with respect to tobacco tax. We currently have six individuals working in that area. We also have 12 RCMP officers working on this issue.
In this recent budget in the process of being approved we have additional resources. We'll be adding six additional people to our enforcement team, six additional people to our special investigations unit as a result of a $1.2 million budget increase to assist in this area.
We continue to work very closely with the federal government on this issue — the RCMP — and with local police and cigarette companies. In fact, from June to December of this past year we were part of a team that seized eight containers that were coming in from overseas, the Chinese mainland, saving British Columbia taxpayers in excess of $8 million. There is a very high profit margin potential on this. It generally costs about $180,000 to move a container of counterfeit cigarettes from China through the system, if it can get through, with a revenue margin of about $3.8 million. It's very, very lucrative.
This is also an issue that I will be discussing tomorrow with the federal government, the Minister of National Revenue. It's a priority item for us and one for which we are marshalling the resources to do whatever we can, working together with Canada, the RCMP, city police and other officials to try to bring this subject under control.
B. Lekstrom: Back to a few questions for the minister regarding the cross-border issue we face in British Columbia in many areas. I thank him for the first answer.
Digging into that a little deeper, can the minister explain doing an audit or, I guess, even prior to that, when a contractor successfully bids on a job…? An out-of-province contractor comes into British Columbia — maybe a large earthmoving job, for instance, maybe a roadbuilding job — brings his equipment in, brings people over and commences to do the job. How do we track whether he's bringing fuel in from Alberta? How do we know we've got a tax issue there? If a motor in a cat goes out, he has to replace that cat motor. Is there a method or a process so that we can ensure that the proper taxes are paid and we receive what's due to British Columbia?
[K. Stewart in the chair.]
Hon. R. Thorpe: Thank you for the question. Whenever a major contract is let, through our variety of sources of information we generally know who the winning company is. They are visited. We also get a list of all their subcontractors. We work very aggressively at ensuring that out-of-province contractors are complying with the tax code of British Columbia.
In fact, I think the member could see, through my earlier answer, that we went from 275 audits for the entire year a year ago to over 324 now, with an increase of $10 million. We take this very, very seriously, because we do not want small businesses or contract businesses in British Columbia having to compete on an unfair, unlevel playing field.
B. Lekstrom: Thanks to the minister for that. I am encouraged with what's taking place. I can tell you the business community in British Columbia is willing to compete with anybody, whether it be Alberta contractors or right across the country, as long as the playing field is level. I'm happy that we are levelling that and ensuring that it stays level.
For the select few — and it is a few — that will try and get around the system of paying taxes…. Believe it or not, there are people out there that try that. I'm sure it's a surprise. For the ones we're aware of — we go out and do an audit of an out-of-province contractor, for instance — can the minister explain what penalties are in place? Is it more than just paying the money due? If it's a reoccurring offence, can we mandate that that contractor isn't eligible to bid on jobs in British Columbia again? What process is followed there?
Hon. R. Thorpe: We have a variety of penalties. For instance, if someone actually collects a tax and doesn't
[ Page 9079 ]
remit the tax, they will get a 100 percent penalty. The other penalties can range from 10 percent to 25 percent. We actually work with companies to ensure they understand the methodology used in British Columbia. Unfortunately, some people don't understand it, but we work to encourage them. Again, it's part of an ongoing process.
I think when I talked about the 100 percent penalty, that's a direct result of willful default or fraud. That's when they get the 100 percent penalty.
The other thing that's important to us is to continue our ongoing work with the business community, with the folks that live in the communities who actually know what's going on. We encourage those individuals to be in touch with our staff, to let us know what's going on. We'll follow up on those.
In fact, I will, before the end of March, be taking two to three days and travelling through Peace River North and Peace River South to meet, first hand, small business operators, contractors, etc. — to see first hand what's going on and to share and be guided by the members for Peace River South and Peace River North on how we can work even better to ensure that the playing field is level.
B. Lekstrom: Following through on this line of questioning and really focusing on that, a question that comes to mind — and it has been around for a long time — is the issue of marked gas. There are certain individuals and corporations that can run marked fuel; purple fuel is what it's referred to. Can the minister tell me how we would approach…?
I believe in other jurisdictions, and I'll use Alberta as an example, if you have a card with a supplier of fuel, you can access certain pumps based on what you're eligible to do. In British Columbia I'm not sure that criteria is there. You can actually pull up to a pump with your gas card, access pump 5, for example — it may be purple or marked gas — fill up your individual vehicle, and away you go. Unless you are caught by the RCMP doing a random test, you'll never pay the road tax on that fuel.
Do we actually go and audit fuel suppliers that offer card locks? If so, what's been the recourse on that?
Hon. R. Thorpe: Yes, we do conduct audits on the fuel. We are in the process of finalizing a review of how we may move forward in the future with respect to coloured fuel in British Columbia. That would be one of the issues as we travel around British Columbia — that we understand from bulk dealers, consumers, etc., how this impacts on their business, on their consumers, and how we can work together to make sure that in British Columbia we have a fair, streamlined, equitable system that ensures there is compliance with the rules. We are currently wrapping up a review of what happens in other provinces so we can move forward.
If the member has any ideas in this area which can make British Columbia a more competitive jurisdiction with fair and level playing field rules, we would be pleased to hear those and to work with him in that area.
B. Lekstrom: I want to thank the minister for that. I think we can correct some inequities that have taken place for a long time while enabling the people who legitimately should have access to this fuel to continue with that and have the benefits, whether it be the egg industry or…. I could go on at some length.
I won't take a lot more time. I do have one further question for the minister that I'd like to touch on, and that's the issue of out-of-province workers coming into British Columbia. Again, they're coming in to work in British Columbia while at the same time taking that payroll they earn while they are here, in many cases in northeastern British Columbia extracting a resource that's owned by all British Columbians.
They're making some very good money, going back — and I'll use the jurisdiction just to the east of us — to Alberta, filing their personal income tax and paying their taxes in another jurisdiction, although they've earned all of that revenue while working in British Columbia. Has the minister and the ministry ever investigated a payroll tax that could be looked at in the province to try to accommodate collection of individual payroll taxes?
Hon. R. Thorpe: Thank you for the question. That is an issue that is a matter of tax policy, which falls under the Minister of Finance. But I can tell the member that it has been reviewed by the Ministry of Finance in the past, and it was concluded that it would be administratively very, very difficult to put in place.
Let me say, with respect to those British Columbians who say they actually don't live in British Columbia but do live and earn their income in British Columbia, that we have moved very aggressively on that and, over the past two years, have collected $25 million due to the province.
B. Lekstrom: In closing, I have probably more of a comment than a question to the minister. I want to thank you and your staff for creating the environment we're all working towards, and that's the level playing field I refer to quite often. It has been a challenge, I can tell you, over the years, in my life in the northeastern part of the province. I know the East Kootenays, as well, faced the challenge. It's somewhat refreshing to hear we're making progress, and we are. I hear it from yourself, certainly, and people who work in your ministry. I've had a great relationship. I've had my questions answered whenever I've had issues to be brought forward. I hear from the contractors and the people in the area I represent, who say: "Look, we're making some progress on this." There's a lot to do still, and I think we all recognize that.
In closing, I want to thank you, Mr. Minister, for the work you do, and through you I want to thank your staff for all the work they do on our behalf.
[ Page 9080 ]
Hon. R. Thorpe: Thank you very much for those kind comments. Of course, the staff with me today are but a small part of the team. I can assure you that myself, as a minister, and these gentlemen, as part of our executive team, recognize that it's a team effort. We are very pleased to hear the comments back from the member about the customer service he's receiving from members. We look forward to continuing to work with all members of this House to ensure that we provide the customer service and that taxes are charged in a fair and equitable manner and collected in a fair and equitable manner.
Vote 30 approved.
Hon. R. Thorpe: I move that the committee rise and report resolutions of the Ministry of Finance and resolution of the Ministry of Provincial Revenue and ask leave to sit again.
The committee rose at 8:25 p.m.
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