2007 Legislative Session: Third Session, 38th Parliament
HANSARD BLUES
This is a DRAFT TRANSCRIPT ONLY of debate in one sitting of the Legislative Assembly of British Columbia. This transcript is subject to corrections, and will be replaced by the final, official Hansard report. Use of this transcript, other than in the legislative precinct, is not protected by parliamentary privilege, and public attribution of any of the debate as transcribed here could entail legal liability.
(Blues)
HANSARD BLUES DRAFT TRANSCRIPT
COMMITTEE OF SUPPLY (SECTION A)
WEDNESDAY, MAY 2, 2007
Afternoon Sitting
PROCEEDINGS IN THE
DOUGLAS FIR ROOMCommittee of Supply
ESTIMATES: MINISTRY OF
PUBLIC SAFETY AND SOLICITOR GENERAL(continued)
The House in Committee of Supply (Section A); R. Cantelon in the chair. [DRAFT TRANSCRIPT ONLY]
The committee met at 2:29 p.m. [DRAFT TRANSCRIPT ONLY]
On Vote 38: ministry operations, $579,354,000 (continued). [DRAFT TRANSCRIPT ONLY]
M. Farnworth: Yesterday we were on emergency preparedness, talking about the flooding and diking, and I know that my colleague from Maple Ridge–Pitt Meadows had asked some questions. I know that my colleague from New Westminster wants to ask some questions, and he will ask them shortly. [DRAFT TRANSCRIPT ONLY]Before we start, I just wanted to quickly let the minister know that once we've dealt with emergency preparedness, I hope we are then in a position where we can move to the Crown corporations shortly after that — the Lottery Corporation and ICBC — and proceed on issues with that. My colleague from Delta North will be taking both those issues. [DRAFT TRANSCRIPT ONLY]
In terms of flooding — what the member for Maple Ridge–Pitt Meadows had left with — if the minister can respond, that would be great. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Perhaps, so that I can respond accurately, the member opposite may want to put the question again, just so that I remember all of the relevant details of his question. [DRAFT TRANSCRIPT ONLY]
M. Sather: I was asking the minister about the allocation of money vis-à-vis the Fraser Basin Council report having come out back in December about the necessity to raise the dikes one metre, and why the minister and the government hadn't provided funds in the budget, with that notice, to address the problem rather than the emergency last-minute funding. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I think a couple of facts are relevant here. The $33 million that has been advanced is the single largest allocation of that kind of funding ever in the history of the province. It has increased the previous best allocation by a factor of four. Clearly, we've had a very robust response this year to the potential flood threat. [DRAFT TRANSCRIPT ONLY]
We are also on the ground much earlier than had previously been the case. In 1999, for example, when we last had a flood threat — a snowpack that was similar to what is out there this year — response and preparation didn't begin until much later. [DRAFT TRANSCRIPT ONLY]
I mentioned yesterday in my remarks that our staff were meeting as early as the first week in January, getting themselves prepared and organizing and strategizing as to how we could meet this flood threat. [DRAFT TRANSCRIPT ONLY]
In terms of the diking infrastructure and issues of that nature, I'm sure the member is aware that what we are dealing with is a problem that has been developing over many decades. Everyone in the Fraser Valley that has any knowledge at all of the Fraser River and its tributaries is frustrated and has been frustrated for a long time that we are not been able to remove the silt and the gravel that is necessary to maintain the flow capacity of those streams and of that river. [DRAFT TRANSCRIPT ONLY]
That is something we need to re-engage on with the federal government, who have some of the regulatory processes in their hands. So we are left, in dealing with the potential threat that we face this spring, with making sure that our diking infrastructure is in the best possible shape. [DRAFT TRANSCRIPT ONLY]
We have, as I said, made $33 million available. Many communities have taken advantage of that. Do I think for a moment that that addresses all of the problems? No, it certainly does not. But it addresses many of the problems that we can deal with now and actually accomplish before the freshet begins. [DRAFT TRANSCRIPT ONLY]
M. Sather: I want to clarify something the minister said yesterday about the $33 million. My understanding is that that is being provided by the province. But the minister had said, as I understood it, that the province is looking to the federal government to cover off half of that amount. [DRAFT TRANSCRIPT ONLY]
If I understood that right, does that mean, then, that the whole $33 million is not available until the federal government comes forward? If the minister could just clarify that for me. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: We announced — I think six weeks or maybe going on two months ago now — that we're making $33 million available, and that money has all been allocated. We also said at that time that it is our belief that the federal government should be good for half of that. [DRAFT TRANSCRIPT ONLY]
I have been in discussion with my federal counterpart, the hon. Stockwell Day, with respect to that. I've said: "Your half of $33 million would be $16½ million dollars." I do not yet have any response officially from Mr. Day — yes or no. However, that's immaterial at this point. [DRAFT TRANSCRIPT ONLY]Quite frankly, it is our felt obligation that we need to be prepared. We have a responsibility to the public to ensure that the infrastructure is in place. We felt two months ago that we couldn't wait for the federal government to make a decision. We had to advance the money now. I would hope, and I still expect, that the federal government will come through with $16½ million. [DRAFT TRANSCRIPT ONLY]
C. Puchmayr: I thank the minister for entertaining the mayor and me in a meeting recently on this issue. The city of New Westminster has a very unique role in the GVRD — the fact that it is the geographic centre of the GVRD. It also has, along the key waterfront, quite a few thousand residents that live there, and the city is working very hard to do mitigation in that area. I believe they've spent close to $800,000 now of the city's tax dollars in mitigation. [DRAFT TRANSCRIPT ONLY]
The other components that are very crucial in that area…. You can just imagine, if you take the 400,000 cars that run through New Westminster on a daily basis, what impact that would have on the entire transportation grid from the Fraser Valley into Vancouver if they weren't able to run through there. It would be just an incredible impact on that structure. [DRAFT TRANSCRIPT ONLY]
We have the major North Fraser perimeter truck route that runs through New Westminster. It benefits all of the region. We have three railways. We have the Southern Pacific, CN and CP that run through New Westminster along the corridor that's in question. [DRAFT TRANSCRIPT ONLY]
We also have a fairly significant containment pond, an environmental containment system, which was put in to take road runoff water. It was a partnership between the GVRD, the provincial government and the city of New Westminster. That containment facility is not yet complete. It's still being constructed. It is exposed to some extreme risks should there be flooding in that area. [DRAFT TRANSCRIPT ONLY]
My question to the minister: in view of how the city plays such a structural role in the region of transportation, why would the government not look at this closer as a high-crisis need for mitigation? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I was pleased to be able to meet with Mayor Wright and the member opposite — I think it was about a week ago — to discuss the particular situation in the city of New Westminster. I should point out, first of all, that two projects were in fact funded in the city of New Westminster. The value of those two projects was about $175,000. [DRAFT TRANSCRIPT ONLY]
I think it's important to keep in mind that as we fund these particular upgrades to infrastructure, it is of course in addition to all of the investment that has happened over the last 50 or 100 years right across the province, and certainly in the case of New Westminster as well. It isn't as if we're starting from ground zero. I'm also mindful of the fact that in 1999, when we had almost the exact same type of flood risk, there was no investment in additional flooding infrastructure in New Westminster, at least not by the province at that time. [DRAFT TRANSCRIPT ONLY]
With respect to the application that the member refers to that was not funded, there were, in the judgment of ministry staff, some issues with that. It was apparently of a temporary nature. What we were looking for here was the type of infrastructure that could be put in place and left in place for a long-term solution. [DRAFT TRANSCRIPT ONLY]
In spite of the fact that that particular project was not funded, I don't want to leave the member opposite, or anyone, with the impression that, as the next number of weeks unfold and we end up with emergency situations, we will be unable to respond. We have distributed sandbags to quite a number of municipalities across the province, including New Westminster. Those obviously could be useful. [DRAFT TRANSCRIPT ONLY]
We also have new technology available today in the form of gabion weirs. We apparently were just testing that out in the last day or so in Mission. These are structures that can add as much as a metre to the top of a dike. If you are talking about a 24-hour period, apparently we can do some two to three kilometres of that in that period of time. [DRAFT TRANSCRIPT ONLY]Clearly, we have some options if a critical situation arises. We have no intention of just ignoring these situations, but we did have a bit of a self-imposed mandate to ensure that the $33 million of funding was put in places where it would endure to lasting effect and also make sure that those works could be accomplished well before the middle of May. [DRAFT TRANSCRIPT ONLY]
C. Puchmayr: Actually, I was on city council in 1999, and there were moneys from the province on some of the preventative measures that were undertaken in the city. [DRAFT TRANSCRIPT ONLY]
Certainly, there is a need for the federal government to come to the table. The minister makes reference to the issues with the Fraser River and the lack of dredging. I should let the minister know that there is a type of dredging that is being used now by the federal harbours board. That dredging is called channel dredging. [DRAFT TRANSCRIPT ONLY]
The idea is to dredge a river in such a way that it's self-flushing. The consequence to that is you end up with a lot of sand on the sides, so we have a lot of sandbars in areas that used to…. One of our marinas is completely covered over with sand because of the impacts of the channel dredging by the federal government. [DRAFT TRANSCRIPT ONLY]
So that has been taken into consideration, and maybe the minister can, when he's talking to Mr. Stockwell Day…. I know Mr. Stockwell Day is ready for flooding because I saw him in a wetsuit once. But I think that certainly has to be considered. The impact that the federal Harbour Commission is having on that water system and the river system really alludes to the fact that they need to come to the table. [DRAFT TRANSCRIPT ONLY]
My final question, I think, will be…. Our engineering said that the mitigation can't be done in a real short period of time — that it's not an area where you can do mitigation in a short period of time. [DRAFT TRANSCRIPT ONLY]
Can the minister assure me, my city and the commuters from all over who travel that route that mitigation can in fact be done on a very short notice without impact to looming disaster? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: If it comes to that and we do have critical situations that arise, our staff and government will certainly be there to do whatever is possible to ward off any danger to communities, to commuters and to residents. Obviously, that is our obligation, and that is one that we intend to fulfil to the utmost of our ability. [DRAFT TRANSCRIPT ONLY]
C. Puchmayr: I checked with the city engineering just a few minutes ago, and the fruits of the meeting we had…. No one has contacted them yet. Is the minister aware of any communication that's ongoing now? What needs to happen to put your people in touch with the engineering on this matter? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I made a commitment that ministry staff would be in contact with the relevant staff from the city of New Westminster, and that will happen. [DRAFT TRANSCRIPT ONLY]
M. Farnworth: Before we go on to the Crown corporations, I have a few questions around Victim Services and crime statistics in general. [DRAFT TRANSCRIPT ONLY]
Between 2001 and 2005 there have been some significant changes around the issue of victim services. Many of the services have been reorganized. Has the minister monitored the reaction from victims during that time, particularly in the last 18 months to two years, to see how those changes have impacted the victims and their satisfaction with the program? [DRAFT TRANSCRIPT ONLY]Hon. J. Les: I very much appreciate the question. In terms of monitoring how we're doing in terms of Victim Services across the province, we have each of the 150 Victim Services organizations across the province — whether they are community-based or police-based — report into the ministry. So that's obviously happening on a regular basis. We also employ focus groups, particularly in aboriginal communities, that are helpful in terms of determining a future direction in Victim Services. [DRAFT TRANSCRIPT ONLY]
We have not as yet implemented formal satisfaction surveys amongst victims groups. That is not to say it's something we won't do in the future, but to date we have not done that. We are relying on the monthly reporting processes and on the focus groups to give us the feedback that we need. [DRAFT TRANSCRIPT ONLY]
M. Farnworth: Well, given the importance of this particular issue and the terrible impact that occurs to people when they have been victims of crime, I think it's important that the ministry do that. Whenever significant changes to programs are made, I think it's important that we monitor and survey and find out the satisfaction level amongst the people that we're trying to help to ensure that those changes are meeting their needs and that we can, if necessary, revamp, fine-tune and introduce new ways of dealing with the issues. [DRAFT TRANSCRIPT ONLY]
I would ask the minister to make that a priority. That is something that definitely needs to take place. I'll illustrate with some examples in a moment. [DRAFT TRANSCRIPT ONLY]
Has the minister had discussions with the federal government in terms of improvements that need to be made to the Victim Services program — recognizing there is the provincial program, but also the federal government can and does have a role to play in this particular area? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: As I'm sure the member opposite is aware, in quite a number of areas of government policy there is involvement by the provincial and federal levels of government. From that flow federal-provincial-territorial working groups that report into ministerial meetings — in some cases, several times a year. [DRAFT TRANSCRIPT ONLY]
That is the case here as well. Our staff is involved in federal-provincial-territorial working groups with respect to Victim Services. As a group, they also do research into Victim Services delivery. From time to time, some funding actually flows from the federal government to help with that research. [DRAFT TRANSCRIPT ONLY]As a province, obviously, we are significantly involved in that FPT process. Sometimes we, in fact, lead those processes. I think we are there. We're at the table, and we can be very proud of the role that our staff play in those processes. [DRAFT TRANSCRIPT ONLY]
M. Farnworth: I think in any of those processes our staff will be doing a terrific job. The question I'm wondering about is at the political level. Are there any specific initiatives that the minister is spearheading with the federal government? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: With respect to our involvement in federal-provincial discussions, we are very much spearheading the issue of the delivery of victim services to communities in the north and in aboriginal communities. [DRAFT TRANSCRIPT ONLY]
That, in part at least, comes about as a result of the tragic situations that we've had around Highway 16, where there have been a number of disappearances of women and a lot of traumatized families as a result. We have been very interested in making sure that we are at the leading edge of being able to deliver victim services to those communities who have been so horribly traumatized by these events. [DRAFT TRANSCRIPT ONLY]
I think we have benefited from that. Victim services in the north along the Highway 16 corridor have certainly benefited from those discussions, and that is something that we want to continue to support very strongly. [DRAFT TRANSCRIPT ONLY]
M. Farnworth: Those are important issues, and I want to say that they need to continue. We need to look at how we provide victim services to aboriginal communities and to aboriginal people and also to other parts of British Columbia. I also think we need to look at how victim services currently work and look at gaps, which is why I asked the question before about is there monitoring taking place. [DRAFT TRANSCRIPT ONLY]
I'm also concerned about the issue around the federal government's role, because I think they do have a role to play. It's important that the minister pursue those avenues. I've been raising some issues around Victim Services and how they relate to families who suffer. [DRAFT TRANSCRIPT ONLY]
For example, in one particular case in my riding, their son was murdered. It's had a devastating impact on the family. It has made it extremely difficult. There are some services there, but the effect on that family and their ability to stay together, particularly as it comes to the financial issue of being able to pay the mortgage and pay the bills, is significant. [DRAFT TRANSCRIPT ONLY]
One of the things that maybe is being looked at — I have raised it with the federal MP, Dawn Black, from New Westminster–Coquitlam; she understands the issue around victim services — is the area around employment insurance, for example. [DRAFT TRANSCRIPT ONLY]
I know that's a federal responsibility, but the ability of a federal program to be either changed or modified to take these types of circumstances into account as part of victim services is the type of thing that the province could be working with and pushing the federal government to recognize. [DRAFT TRANSCRIPT ONLY]
I have spoken with my own MP, James Moore. He understands the importance of victim services in this type of issue. The message I want to give the minister is that we need to be looking at ideas. We need to be talking to victims, we need to be monitoring the services, and we need to be saying — even if they are outside our jurisdiction, if they are coming forward with good ideas — that here is a way in which you can deal with some of these issues. [DRAFT TRANSCRIPT ONLY]They don't impact a large number of people, but the number of people they do impact is significant. If there is an opportunity, then we should be taking a leadership role. I think the minister has that ability, as this province's Solicitor General, on these round-table discussions to do exactly that — to raise these types of issues as being a priority and say: "We are willing to work with you, federal government, to do this." [DRAFT TRANSCRIPT ONLY]
That's what I'm asking the minister. I understand the importance of the initiatives that he's outlined. What I also want the minister to do is to recognize that by monitoring the effectiveness of programs, looking at them in terms of how the province can do things…. Will he also recognize that there is the ability for him to play a leadership role and do that in terms of where there is an overlap between the province and the federal government? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I should say first that I certainly appreciate the comments that the member opposite has made. I think they're well-founded. [DRAFT TRANSCRIPT ONLY]
Two things. I want to get on the record as well that our staff participate — I think they are the only provincial representatives — on the national victim advisory committee, which gives them another great opportunity to advocate for victims at the national level. [DRAFT TRANSCRIPT ONLY]
Often we need what are referred to as out-of-the-box solutions. The member opposite has just suggested one, which I'm somewhat attracted to. [DRAFT TRANSCRIPT ONLY]
Attaching EI funds for this purpose is probably not out of the realm of the possible, particularly as we're in the happy situation in British Columbia where we find very little takeup of EI funds at the moment. Perhaps we could divert some of that to Victim Services. I certainly would have no philosophical objection to that. If and when I have the opportunity, I just might be advancing that notion. [DRAFT TRANSCRIPT ONLY]
M. Farnworth: I'm glad to see the minister is receptive to comments from his critic. I agree. We need to recognize that the impact of crime on victims is significant. We need to recognize that it's sometimes not just the things that we think they need but that it's often much deeper than that. We need to be creative and think outside the box — much as I hate that term — in how we approach the issue. [DRAFT TRANSCRIPT ONLY]
Another example I'd like to raise to the minister that I think is important…. It often concerns young people who become victims of crime, particularly victims of crime in gang violence, and that is the issue around cooperation with the police in terms of qualifying for the program. That is an important principle. No one disagrees with that, but there are also circumstances where you have individuals who feel absolutely terrified and terrorized that if they say something, then they will suffer very severe consequences. [DRAFT TRANSCRIPT ONLY]
As a result, they sometimes find it difficult, in terms of Victim Services, dealing with claims or dealing with their ability to access the program, because that is a key component of that. I don't disagree that that should be an important principle, but I also think we need to recognize, particularly at that age group — teenage, adolescence and early adulthood — that it can be very, very traumatic and trying. [DRAFT TRANSCRIPT ONLY]I want to ask the minister: have they recognized that this can be an issue, and if so, are they doing anything about it? [DRAFT TRANSCRIPT ONLY]
[D. Hayer in the chair.]
Hon. J. Les: Just a couple of points I'd like to make in terms of youth and gang violence. First of all, it's something that the ministry and the victim assistance staff are highly aware of, obviously. [DRAFT TRANSCRIPT ONLY]
There's a pilot project currently going on in the Broadway Youth where they are given a supportive environment, where they are able to learn how to deal with peer pressure. We also have a Youth Against Violence line, where youth can provide information and report situations that they are aware of on an anonymous basis. We think that's an important outlet for them. That allows them to keep a sense of security so that they're not exposed. [DRAFT TRANSCRIPT ONLY]
We also have a youth gang strategy where youth are encouraged to work in fairly close contact with the police and with the justice system to eliminate some of the alienation or the perceived barriers that sometimes exist between youth in the community and the justice system generally. [DRAFT TRANSCRIPT ONLY]
All of this is a lot of hard work. It's not easy to overcome some of those barriers, particularly when there are gang environments. But we do some good work in the ministry to try and give youth a sense of security, particularly if they wish to cooperate with the authorities. [DRAFT TRANSCRIPT ONLY]
M. Farnworth: Hon. Chair, at this point I'm going to turn it over to my colleague from Delta North, who will have some Crowns to ask questions on, and then we will return after that. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Just a quick heads-up to the minister that chronologically, we're looking at probably liquor, quickly…. I certainly would like to thank the Liquor Distribution Branch, who had the meeting with me and my colleagues this morning. [DRAFT TRANSCRIPT ONLY]I'll follow with some questions relative to ICBC and the B.C. Lottery Corporation, and maybe afterwards we could have some housekeeping. If things go well, I can't see why we can't move on and finish today, hon. Chair. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Maybe we could even finish with liquor. [DRAFT TRANSCRIPT ONLY]
G. Gentner: I'll take that as an invitation. [DRAFT TRANSCRIPT ONLY]
Maybe I'll relinquish the position to my hon. colleague to my right. [DRAFT TRANSCRIPT ONLY]
N. Simons: My questions are going to be around the issue of rural agency stores and an issue that's affecting some 230 such stores in the rural parts of our beautiful province. [DRAFT TRANSCRIPT ONLY]
Recently the government introduced another increase in the discount that private liquor stores, LRSs, receive when they purchase alcohol for resale. It was 10 percent, I think, back in 2000. It went up to 12 percent first, I believe it went up to 13 percent around 2004, and then it went up to 16 percent now. [DRAFT TRANSCRIPT ONLY]
My concern is about the fairness of that. My concern is about the fact that this has actually put a lot of rural agency stores in a less viable situation when they're now competing with stores that are able to purchase alcohol at such a high discount. I'm just wondering if the minister can explain some of that for those people who live and work in rural parts of our province. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I'm quite well aware of the rural agency stores and, as the member points out, the 230 of those that we have across the province. I should first of all point out that these stores were never meant to be full-fledged liquor stores. These are stores that, in the first place, offer quite an array of different products for sale. They're corner stores, general stores — gas bars in some places. The general rule of thumb is that the sale of liquor will not exceed 20 percent of their gross sales. [DRAFT TRANSCRIPT ONLY]
They are in essence an extension of the government liquor store system. They buy their alcohol at a 10-percent discount, and they undertake to sell that alcohol at government liquor store prices. I'm not sure that that should place them at any great position of disadvantage with respect to the LRSs. Most of the LRSs seem to be retailing their liquor in and around government liquor store prices — in some cases, a little higher. I don't think their competitive position has eroded as a result of that. [DRAFT TRANSCRIPT ONLY]
I think there would be quite an outcry if suddenly we were to increase the discounts available to the RASs — or, indeed, if we were to take the cap off the prices as well. This is a convenience service that was extended for these more remote and rural businesses to be involved in. I think for the most part that they have very much appreciated having an additional line of business within their overall business, and we do not contemplate any changes at this point in time. [DRAFT TRANSCRIPT ONLY]
N. Simons: Well, thank you for the answer. I think I would like to take issue, if I may, on a number of points that were made. [DRAFT TRANSCRIPT ONLY]
First of all, I don't think it's necessarily appropriate to compare the business reality that the rural agency stores face right now as opposed to even five years ago before the private agencies started opening. Also missing in the minister's response is an explanation of how you can compare some urban big-box liquor outlets and their ability to make profit when they get a 16-percent discount versus the small general store. We're talking about little general stores in the small coastal villages and the far regions of the province, in the Peace River and the interior. They're all asking about the same thing. [DRAFT TRANSCRIPT ONLY]
There was an outcry when the minister increased the discount once again. The outcry was from people who are trying to make their businesses run, often small business owners, often people who are the only employers in their region. In some cases, the jobs and the values that these small agencies add to their communities are significant. I don't think it should be overlooked, especially when in the rural parts of our province the economic successes that we see in some sectors don't always impact on everyone equally. [DRAFT TRANSCRIPT ONLY]I think the business reality is that we all know the big-box stores compete now for food. Originally, when rural stores started opening, they sold food too, and people did their grocery shopping there. Their reality has changed, and that should be recognized. Their whole economic viability is further impacted by the increase in the number of outlets. Now we see, in fact, that some of the private liquor stores are advertising that they are able to beat the government liquor store prices. [DRAFT TRANSCRIPT ONLY]
I'm just wondering if the minister could comment on the disadvantage that the rural agency stores seem to be having in the face of this stiff competition that's been dictated by government at a benefit to the private industry of $20 million a year. I think that's a conservative estimate of what this further discount has meant to the large liquor outlets. [DRAFT TRANSCRIPT ONLY]
We're talking about potentially the liquor barns and the liquor worlds and the expansion of big liquor. I think if you think about the fact that most people who are tourists now…. If they're going to stock up on food, they're going to stock up on alcohol. In the old days you'd wait until you went to buy the worms and the ice and the fishing tackle and the beer. [DRAFT TRANSCRIPT ONLY]
Now the situation is a lot of these stores…. The tourism industry is a traditional strong supporter of these rural stores, whether they're marina stores or a place where you go camping or fishing or mountaineering or what have you. They need to know if they're about to lose out significantly to the private interests. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I guess I should underline again for the member that when rural agency licences were made available to these general merchandising stores five years ago, it was never intended that liquor would become their main source of income. It was an additional line of business. The suggested maximum would be about 20 percent of their overall sales. [DRAFT TRANSCRIPT ONLY]
It was very warmly welcomed by that small business sector at the time, and I'm assuming that they still welcome that additional line of business that they previously did not have available to them. They are restricted to selling their products at government liquor store prices, and while there may be a few LRSs that are selling at less than government liquor store prices, my strong suspicion is they are not in locations where they are at all competing with the rural agency stores. [DRAFT TRANSCRIPT ONLY]
Rural agency stores tend to be located in places where they do act as a convenience store. I think it's also fair to say that when they got their RAS licences five years ago, many of them actually saw the rest of their business increase as well because the availability of liquor in those locations actually drew more people to their establishment, and there was a lot of incidental buying going on as well. [DRAFT TRANSCRIPT ONLY]
Generally speaking, I think it has been good for the convenience store sector. As I said before, I don't see any particularly convincing argument at this point that the current environment should change. [DRAFT TRANSCRIPT ONLY]
N. Simons: Convincing argument. We started out by selling liquor in rural agency stores because we didn't want people driving far to go get their alcohol. We thought we were in an era where there was some social responsibility being accepted by the community in terms of drinking and driving. [DRAFT TRANSCRIPT ONLY]
If you look back, the Evans report was one of the first that started saying that this is how we start structurally changing the system to reduce the number of people who are going into the city, buying alcohol, using alcohol and driving back drunk. I think that's a very strong public safety argument in and of itself. [DRAFT TRANSCRIPT ONLY]
I think the question of fairness…. You just go to the values and mission statements of the Liquor Distribution Branch, and you can see they talk about integrity and respect and teamwork and all the rest of the things. We will see an impact on the small agency stores — some more than others. If you happen to have a big box outlet in Duncan, the rural communities near it are probably going to suffer. It is what draws people in, in many cases. [DRAFT TRANSCRIPT ONLY]Just as our shopping habits have changed, so have our drinking habits. Recognizing that evolution in purchasers' habits, I think we need to really be careful about the impact on these small stores. If I may, the viability of rural stores should not be based on their ability to sell alcohol — sure. I don't think it always is. [DRAFT TRANSCRIPT ONLY]
Here's from the Maple Leaf Store in Crescent Valley: "While our costs continue to escalate, and we support our community school, sport teams and organizations, we receive no concessions from the government as do the private stores, who are mainly located in the larger business areas." [DRAFT TRANSCRIPT ONLY]
You see the impact that sometimes one of the only businesses in the area, the general store, where you can, as I said, buy your bread, your beer and your wine…. Bathgate General Store: "It's become increasingly difficult to maintain a high level of service and support in a small community when the playing field isn't even." So there's a perception of an unevenness in the playing field. [DRAFT TRANSCRIPT ONLY]
I think the previous minister was clear that his intention was to make the purchase of alcohol the same for all vendors. I'm wondering if those arguments aren't enough, because I may have some more while I listen to the minister's response. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The fact of the matter is that this is how the system was set up five years ago. We do have a lot of establishments around the province where alcoholic products are available. I think that has added a great level of convenience for the public. The rural agency stores are part of that. Alcohol is part of their business. It's a minor part of their business. That was always the intention. That was the clear understanding at the time. [DRAFT TRANSCRIPT ONLY]
I have never heard my predecessor talk about a level playing field — in other words, the discount being equal to all — other than in a speculative context where there was some discussion going on at that time about government exiting the retail business altogether in terms of alcohol. [DRAFT TRANSCRIPT ONLY]
We're not doing that, as the member is well aware. So we have a situation where rural agency stores can sell alcohol as a convenience to the public. They get a 10-percent discount. They sell at government liquor store prices. The sale of alcohol is no more than 20 percent of their overall business. [DRAFT TRANSCRIPT ONLY]
LRSs, on the other hand, have a 16-percent discount. They can price wherever the marketplace indicates, but they are restricted from selling pretty much any other products. They sell basically alcohol only. [DRAFT TRANSCRIPT ONLY]
If we were to start turning rural agency stores into what effectively would become liquor stores — if they had the same rights and privileges as LRSs — then pretty quickly the LRSs, I think, would have a case to make where they should be allowed to expand their lines of business as well. [DRAFT TRANSCRIPT ONLY]
We have a relatively stable situation today in liquor retailing in British Columbia. I propose that we leave it that way. [DRAFT TRANSCRIPT ONLY]
N. Simons: I'd just like to correct one little fact. Many, many of these private liquor stores are starting to sell other items. In fact, one store, the Duhamel Store in Nelson, wrote to you, I believe, saying, "We notice that wine and beer stores are selling an ever-increasing inventory of items such as lottery, snack foods, non-alcoholic beverages and various other promotional items," and I'll add ice. [DRAFT TRANSCRIPT ONLY]
Many of these stores are actually competing with the convenience of the rural stores. If you're heading to the dock or to the campground or to the cottage, you'll pack up with everything in the city. [DRAFT TRANSCRIPT ONLY]
I'm not saying that the rural agency stores should get a special extra break, but I think that a 16-percent break to what are probably going to be large multinationals versus a 10-percent break to the small mom-and-pop stores that are operating…. They're the stores you walk into, and there are wooden floors. You get a sense of history in so many of these places. Not to mention some of the newer stores…. [DRAFT TRANSCRIPT ONLY]One, the Shearwater Marine Group, I think, wrote a letter saying that they were actually told: "Don't bother applying for an LRS. We're going to make all private liquor stores, including the little ones, the same." So they didn't. [DRAFT TRANSCRIPT ONLY]
There are business people who are put out by this. I know that the British Columbia Restaurant and Foodservices Association is concerned about this, and they're asking that there be some sort of discussions around this issue. [DRAFT TRANSCRIPT ONLY]
Back to the jobs. The Slocan Valley co-op. Our business model is one that works well, creating a vast number of jobs. Our store alone supports a base of 16 employees, with an increase during the summer season, indicating again the relevance of the stores for the tourism traffic. I think we need to try to do what we can to encourage and, I would even say, not just encourage, but allow it to be an equal playing field. I don't think anyone would see a 16-percent discount for one private retail outlet as the same as a 10-percent discount for another retail outlet. [DRAFT TRANSCRIPT ONLY]
Then you look at the other factors — the social factors about driving and the impacts on the rural communities. These baseball teams are supported by these little mom-and-pop stores. I really think it would probably be a good idea, if it's possible, to engage in some discussion through, perhaps, the food services association to discuss the impact, or to at least measure the impact, that these further discounts for private agencies will have on rural stores. [DRAFT TRANSCRIPT ONLY]
I would like it if they were treated fairly and equally. At the least, would the minister be able to tell the people in the rural parts of this province, who want to be able to live…. We need people living in our rural areas. We need to encourage community cohesion in rural communities, and if we find ways of encouraging that good, but let's not find ways of discouraging that. [DRAFT TRANSCRIPT ONLY]
That's what I think is ultimately at issue here: what is perceived by many as the unfair advantage to the private liquor stores. Will the minister be able to tell the people in the province that there will be some further discussions around this issue at minimum? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I don't want to give rise to unfounded expectations. I do not intend to engage in a serious way in terms of increasing the discount or of lifting the cap on retail prices in rural agency stores. We need to be clear. We have 230 rural agency stores across the province. That is a service that is available to residents of mostly rural communities, where they can now access alcoholic beverages at government liquor store prices. [DRAFT TRANSCRIPT ONLY]
I think that is good news for rural British Columbia and, at the same time, I will also submit that was good news and still is good news for the owners of those small businesses who now have an additional line of business that they did not previously enjoy. On that line of business, they receive a 10-percent margin. I have never been in the retail business. I'm not sure whether a 10-percent margin is good, bad or indifferent. I suspect it's not bad. [DRAFT TRANSCRIPT ONLY]
Now, I get the fact that there will always be some pressure, a little bit of agitation, to see if we can maybe shave a little bit here and bump a little bit there. I understand that. I appreciate that. Nothing wrong with that. But the fact of the matter is that we've, I think, been very clear. The situation, as it is now, seems to be working relatively well, and there seems to be no overwhelming need to adjust those margins for that particular class of licence. [DRAFT TRANSCRIPT ONLY]
N. Simons: Well, I would just take issue with the minister's characterization of the situation as going reasonably well. "Reasonably" is subjective, I suppose. To many people, it's reasonably well. To the people who can purchase alcohol at low prices, it's good. But for people who are trying to support business in an environment where competition is unduly influenced by government intervention, I think that's another story altogether. [DRAFT TRANSCRIPT ONLY]
I'm just wondering if maybe the minister can tell us the economic impact of the further reduction to 16 percent of the LRSs and their costs to the government revenues. [DRAFT TRANSCRIPT ONLY]Hon. J. Les: At face value, the difference in the discount would be about $22 million. Of course, we will not know what the actual difference will be until the end of the fiscal year because we're showing very strong growth right now in terms of all kinds of retail sales across British Columbia. The liquor sector is also enjoying that upsurge in retail sales. [DRAFT TRANSCRIPT ONLY]
The other thing that's useful to keep in mind…. When the discount was increased from 13 to 16 percent, immediately you saw a lot of advertising going on where licensee retail stores were saying: "Come on in. Buy your liquor products at our place at government liquor store prices." [DRAFT TRANSCRIPT ONLY]
It clearly had a downward effect in terms of retail liquor prices, which I would suggest is and was good for the consumers of British Columbia. So it would be wrong to suggest that the $22 million migrated straight to the bottom line of the LRS operators. In fact, there's lots of evidence to suggest that a significant portion of that difference went straight into the pockets of British Columbian consumers. [DRAFT TRANSCRIPT ONLY]
N. Simons: Using the minister's rationale, it would be a benefit to all consumers if we just made it a 50-percent or a 60-percent discount for everybody. It's not a question of how big the discount is. It's a question of: why is there a discount for one private liquor outlet and not…? Why is there an unequal application of this? [DRAFT TRANSCRIPT ONLY]
I think it is a question of fairness, and I'm not talking about, you know…. The rural stores aren't the ones that have huge resources behind them. Many of them are just operating in the community, providing a service and being a hub for the community. They're not fabulously wealthy. [DRAFT TRANSCRIPT ONLY]
I think that their charges have been increasing yearly. Their reality has changed. Their freight charges are exorbitant. Their fuel charges are high. Their insurance costs are high. Their utility costs are higher. They're already at a disadvantage. [DRAFT TRANSCRIPT ONLY]
Yes, they do provide a service. They provide a service willingly, and they provide a service, I might add, very ably. They provide the highest standard of liquor service in the province, as far as I'm concerned. [DRAFT TRANSCRIPT ONLY]
As far as I know, we don't have a lot of complaints about under-age drinking or selling to under-age…. I don't know what the statistics are on that. I just think that it behooves this government to look carefully at the needs of rural communities and of the stores that often form the core of those communities, and I think a dialogue is essential in order to address those particular concerns. [DRAFT TRANSCRIPT ONLY]
What is the relationship between ministerial policy and…? How is it directed that these discounts take place? Who's in charge of saying: "Do another discount"? I'm just wondering where that direction comes from. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Obviously, we monitor the wholesaling and retailing of liquor closely across the province, whether that retailing occurs in government liquor stores, LRSs, RASs, pubs, bars or restaurants. There are of course any number of different types of locations in which alcohol is bought, sold and consumed across the province. [DRAFT TRANSCRIPT ONLY]
When we had an evolution, frankly, in the last four or five years in the province where alcohol was now allowed to be sold in what we refer to as rural agency stores, this was business that they did not previously have. When the member talks about being supportive of rural communities, allowing these rural small merchants to sell liquor as well was in fact a policy direction that was very supportive of rural communities. [DRAFT TRANSCRIPT ONLY]It was at the same time very supportive of the consumers in those rural communities, as they're able to access those liquor products in their communities through rural agency stores at government liquor store prices, which are the same right across the province. [DRAFT TRANSCRIPT ONLY]
When we watch the operation of the liquor retailing enterprise across the province and there is evidence that a certain discount level is not working as well as it should — in that it is keeping prices too high — then clearly decisions are made to take a discount level to another place, which was done in the LRS sector. [DRAFT TRANSCRIPT ONLY]
As I've already indicated, it seems to be working its way through the economy rather well and producing significant retail price discounts for consumers. I would suggest that is a good thing. [DRAFT TRANSCRIPT ONLY]
N. Simons: The minister, I think, just told us that the private liquor industry said: "We wanted to make a higher profit." The government said, "Good idea," and they increased the discount. [DRAFT TRANSCRIPT ONLY]
I don't know what other explanation there has been. It seems to me there's been no demand from the general public that they increase the amount of profit to these private liquor stores. I don't know whether there has been a letter-writing campaign that I'm not aware of. [DRAFT TRANSCRIPT ONLY]
I certainly can tell you there's been a series of letters written from East Kootenay, West Kootenay, Cariboo North, Cariboo South, Columbia River–Revelstoke, Peace River North — you name it. These are rural ridings represented by both sides of the House. This is not really an issue about partisanship. I think it's an issue about fairness. [DRAFT TRANSCRIPT ONLY]
I've had letters from people from the Liberal Party. The constituency president in Powell River even wrote a letter. I skipped the part with all the glowing things he said about the government, because I had to skip to the important part. That was that he found this an unfair advantage. I believe he's also the owner of an LRS. [DRAFT TRANSCRIPT ONLY]
I thank the minister for his responses. I hope we can move this issue forward. With that, I cede the floor to my friend from Delta North and the islands. [DRAFT TRANSCRIPT ONLY]
G. Gentner: There are no islands yet in Delta North. We'll see after the floods and how well the Solicitor General is able to provide protection — well needed and afforded to the people of Delta. [DRAFT TRANSCRIPT ONLY]
I want to speak about the increase on the discount rate. On November 28 the Liquor Barn Income Fund released a press release. A leading operator of private retail liquor stores in western Canada today commented on B.C. liquor distribution branch's recent announcement that the wholesale purchase discount rate will increase from 13 percent to 16 percent. "We are pleased with the BCLDB's announcement, as the increase in the purchase discount enhances our overall operational flexibility." [DRAFT TRANSCRIPT ONLY]
To the minister: why would a large liquor corporation in Alberta be commenting on this increase in the discount rate? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I do recall the memo to which the member refers. It of course was issued by an income trust whose shares at that time, quite frankly, were somewhat under water. Clearly, what they were trying to do is take this new reality and hype it, in hopes of raising the value of their business. [DRAFT TRANSCRIPT ONLY]
As the member may be aware, there have been subsequent negotiations between themselves and others with respect to sales and acquisitions and those kinds of negotiations that corporations enter into. I of course disagree with the assumption that was being made in that memo, and I think subsequent events have borne that out. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Obviously, the ministry and the distribution branch are monitoring the activities of big-booze or big-box chains moving into British Columbia. Can the minister tell the House how many independent liquor stores over the next five years are anticipated to be bought up by these huge franchises? [DRAFT TRANSCRIPT ONLY]Hon. J. Les: I'm here to answer questions relevant to my ministry. I have no idea what the particular plans are of Liquor Depot, Liquor Barn, Wal-Mart, Eaton's or any other particular chain. [DRAFT TRANSCRIPT ONLY]
I'm sorry about that, but I'm just not equipped to answer questions on behalf of the private sector. [DRAFT TRANSCRIPT ONLY]
G. Gentner: I raise it because the notion of selling liquor to private stores — I'm not talking about the rural stores, but the ones that were adjoined to pubs, for example — was a policy that was evolved in, I think, 2001-2002 to allow them to increase profitability. But there has been quite a big shift in that these independent retail stores are now being bought up, and obviously the minister doesn't care whether or not that is the case. [DRAFT TRANSCRIPT ONLY]
I asked the minister, because this is now a shift in policy: how many retail outlets that are attached to pubs are now being bought up by the big box franchise chains? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I don't have that information here. I will undertake to get that for the member. [DRAFT TRANSCRIPT ONLY]
It's important to remember that licensee retail stores remain attached to liquor primary operations. I'm sure the member is aware of the genesis of that. That essentially has always been the case. The only way that you get a licensee retail licence or an LRS is to have a liquor primary licence in the first place. That association continues. [DRAFT TRANSCRIPT ONLY]
G. Gentner: If I'm right, the minister is suggesting that there are no independent retail liquor stores that were attached to a pub that now have been removed. I mean, that there are two separate operations: one is a pub owner and one is the new franchise purchasing. Am I correct: the minister said that type of activity is not occurring? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: You have a liquor primary operator who has an LRS operation. It is perfectly okay for that particular individual, that business owner, to enter into a third-party agreement with another liquor store operator to run that side of the business on his behalf. But that initial attachment still remains. [DRAFT TRANSCRIPT ONLY]
That doesn't mean that the liquor primary licence disappears. It remains in effect, and in a sense that LRS still remains attached to that liquor primary, even though it is being operated through a third-party agreement by another franchisee. [DRAFT TRANSCRIPT ONLY]
G. Gentner: I'm glad the minister clarified that, because I think there is a profound shift in the sale of liquor and how the market is going to change, very similar to what we have seen in Alberta. Ergo the comments from the Liquor Barn and how elated they are that this government is encouraging discount pricing. [DRAFT TRANSCRIPT ONLY]Just reading several service plans…. I talked to Mr. Smukowich to give you a heads-up on this question. I know it's somewhat philosophical. This is sort of devil's advocate, if I may, but why is distribution still in government hands? Why don't you turn that over to the market? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Is the member advocating that? [DRAFT TRANSCRIPT ONLY]
G. Gentner: Hon. Chair, I'm asking the question to the minister: whether or not he philosophically believes that distribution of liquor is better held in government hands or private hands. We've seen this privatization over a long time. We've seen the model in Alberta. If that is a model and seeing the trend…. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: There are currently no plans to move the distribution of liquor outside of government. [DRAFT TRANSCRIPT ONLY]
G. Gentner: I want to know, therefore, since it's a quasi monopoly on the distribution side but on the retail side it's now free enterprise, how TILMA is going to affect the distribution of liquor. Will the private monopoly of the distribution in Alberta, wanting an equal playing field, not come forward to your ministry and ask for the same thing? What correspondence…? What is the expectation of the minister for the distribution side of it being brought forward as a controversial issue in the TILMA agreement? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I'm not sure that I have a fulsome answer with respect to the impact of TILMA on either the wholesaling or the retailing of liquor in British Columbia — or Alberta, for that matter. I have had no concerns raised whatsoever by ministry staff regarding the impact of TILMA on liquor retailing or wholesaling. It seems convenient nowadays that anytime somebody wants to raise an issue, you raise the bogeyman of TILMA, which probably in most cases is just a smokescreen. [DRAFT TRANSCRIPT ONLY]
We know from the research the Conference Board of Canada has done that TILMA is poised to generate huge economic benefits for all British Columbians in terms of 78,000 additional jobs and billions of dollars' worth of economic activity in the province. [DRAFT TRANSCRIPT ONLY]
If there are implications with respect to liquor in either Alberta or British Columbia, I am sure we will work through them. At this point, I am not aware that TILMA will raise any difficulty in that regard. [DRAFT TRANSCRIPT ONLY]
M. Sather: With regard to the trade, investment and labour mobility agreement, or TILMA, the Minister of Economic Development has made it really clear that the issue is about discrimination and non-discrimination. So if you have a private distribution system on one side of the border and a public distribution system on the other, it seems to me a reasonable prospect that, let's say, the private distribution people in Alberta could say quite clearly that they are being discriminated against because distribution here in British Columbia is not open to them. That's the whole point of TILMA, according to the minister — that it not be about discrimination of one party by the other, of one province by the other. [DRAFT TRANSCRIPT ONLY]
I would have thought the ministry would have discussed that possibility. It seems to me like it's a fairly reasonable, plausible scenario. [DRAFT TRANSCRIPT ONLY]Hon. J. Les: Well, I know that particularly that member opposite thinks that TILMA is the end of the world as we know it. Actually, it's not. In many cases it will be absolutely business as usual, and we think that that's the way it will be in the liquor business as well. [DRAFT TRANSCRIPT ONLY]
The member opposite may also want to consider that actually, in legal terms, the liquor distribution business in Alberta is still very much in the hands of the Alberta government. They have contracted out the physical service of distribution, but they are still the receiver of record, as we are here in British Columbia as well. Certainly in terms of that, they are still very much in the distribution business. [DRAFT TRANSCRIPT ONLY]
The other thing to keep in mind is that the distribution of beer is already carried out by the private sector, by the manufacturers of beer. There are no wineries in the province of Alberta that might be concerned about any TILMA implications. I believe there is only one minor distiller in Alberta that may or may not have any issues. We have not uncovered any issues to date that would cause us to have to do a thorough examination of all of this with respect to TILMA, and we don't think there will be. [DRAFT TRANSCRIPT ONLY]
As I've said, the benefits of TILMA have been well-canvassed. I know that the members opposite perhaps don't share the belief in free and open trade between provinces within our country. That's fair enough; we beg to differ. We think it can be advantageous to all British Columbians. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Well, TILMA's enough to make anybody want to go out and drink. It's going to be very interesting where we're going to be in the next couple of years with TILMA, because I don't think this government understands the full implications. Nevertheless, we will move on. [DRAFT TRANSCRIPT ONLY]
[J. McIntyre in the chair.]
U-brews are great; they're a wonderful thing. They are there so that any adult can make their own brew and wine to take home for one's personal consumption, and I do so. I certainly frequent my local U-brew guy all the time. Clearly, one may not provide U-brew beers or wines for public consumption at any public event. My understanding is that you must purchase your liquor from a B.C. liquor store or another source approved by Liquor Distribution Branch. [DRAFT TRANSCRIPT ONLY]
Can the Solicitor General, the minister responsible for liquor distribution and enforcement in the province, explain how it is that his ministry spent $480 at Scotties' U-brew? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Frankly, I have no idea how it came to be that $480 of ministry funds were spent at a U-brew, nor whether in fact any alcoholic product was purchased with that money. We can certainly chase that down for the member opposite and get back to him with that information. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Well, I'm not here to try and embarrass the minister — because his is not the only ministry that has this sort of problem. Even the government's own principal lawmaker, the Attorney General, spent $544 on the same U-brew. It may sound like a small pittance, but nevertheless, we're talking about the taxpayers' credit card. [DRAFT TRANSCRIPT ONLY]
I'm not going to go at great length on some of the abuses here. There is actually, for example, Zsu Zsu Hair, Skin, Nails in Regina from your ministry. There's a whole host of other suspicious, interesting entries here, but I want to know from the minister what type of oversight he or his ministry is conducting with the use of the people's credit card. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Frankly, I'm somewhat sorry to hear that line of questioning. As I'm sure the member opposite is aware, we have a practice in government of rewarding government employees from time to time, who work hard every day to serve the people of British Columbia. When we do this, frankly, we buy prizes or entitlements to various things, in keeping with an appropriate reward or a pat on the back. [DRAFT TRANSCRIPT ONLY]This isn't the first time that the member opposite draws unfavourable attention to that practice. He can be assured that we do everything possible to make sure we spend every dollar that we obtain from the taxpayer very carefully. But a good human relations strategy is a very important part of any successful operation. [DRAFT TRANSCRIPT ONLY]
Frankly, if from time to time management staff find it appropriate to reward employees and individuals for work well-done or a service well-provided, that will continue to get government support. I would hope that the member opposite will see the benefit of that as well, and not, frankly, harshly criticize those hardworking public employees who are often so richly deserving of that kind of recognition. [DRAFT TRANSCRIPT ONLY]
G. Gentner: I thank the minister for his comments on the line-by-line items. True enough, there may be some gifts that are rewarded to some staff, but there are entries here like Moores Clothing and other retail here that I just don't find appropriate. [DRAFT TRANSCRIPT ONLY]
Be that as it may, we'll now go to ICBC. If we can make a shift and thank the good people from the Liquor Distribution Branch for coming today, my good friend from Surrey–Panorama Ridge will lead us off. [DRAFT TRANSCRIPT ONLY]
J. Brar: The question I have to the minister is with regard to the Central City property we have in Surrey. That property was put on sale last October, '06. My first question is…. I would like to know from the minister: what is the rationale behind selling that beautiful property we have in the city of Surrey? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Because of the commotion and the changing of staff, I didn't hear the question appropriately. So I'll ask the member opposite to repeat it. [DRAFT TRANSCRIPT ONLY]
I will take this opportunity, however, to introduce staff, which I have not been appropriately doing all afternoon — as I should be with quite a number of staff moving out. To my right, of course, is Paul Taylor, the president and CEO of ICBC. To my left is Anne Worchadarie, who is the comptroller, and Mark Whitenshaw is here — the vice president for drivers services. [DRAFT TRANSCRIPT ONLY]
I'll now ask if I can indulge the member opposite to ask the question again. [DRAFT TRANSCRIPT ONLY]
J. Brar: Thanks to the minister for introducing staff members. I appreciate the extraordinary work the staff members are doing, particularly in assisting with providing us the appropriate answers. [DRAFT TRANSCRIPT ONLY]
My question was with the Central City building ICBC has in the city of Surrey. That property was put on sale in last October, '06. What I want to know is: what was the rationale to make a decision to sell that property? [DRAFT TRANSCRIPT ONLY]
Interjection. [DRAFT TRANSCRIPT ONLY]
J. Brar: Central City, that huge building…. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Yeah, yeah. What was your last question? [DRAFT TRANSCRIPT ONLY]
J. Brar: What was your rationale to sell that property? Why did you sell that property? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The member is quite right. At Central City in Surrey, ICBC is the proud owner of a very large building — probably the largest building in Surrey — and has been the owner of that building for quite a number of years. [DRAFT TRANSCRIPT ONLY]
Obviously, it is a very, very significant asset. However, with that building comes the prospect of future development. ICBC is not first and foremost a development company; it is an auto insurance company, and it wants to focus on its core business. [DRAFT TRANSCRIPT ONLY]As an investment…. ICBC really is not in the land investment or building investment business either, so the board of directors, after reviewing the entire situation, came to the conclusion that for the purposes of ICBC's business going forward, the best solution was to liquidate the building and market it internationally. That is what they have done. I believe they are not far off from making a final decision in terms of who the successful proponent was, but that final decision has not yet been made. [DRAFT TRANSCRIPT ONLY]
J. Brar: Thanks to the minister for the clarification and information about the property. [DRAFT TRANSCRIPT ONLY]
My understanding, from the comments made by the minister, is that the property has not yet been sold. I would like to know from the minister on what date this property was put on sale and where the property has been marketed — whether it's locally or internationally. What were the steps taken to market this property? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: When you have a very large real estate asset like Central City in Surrey, obviously you have to market well beyond local boundaries and even provincial boundaries. If the member reads The Economist magazine, he probably would have seen this asset being marketed through The Economist magazine. This was an international marketing effort. There were dozens of responses from interested investors around the globe. [DRAFT TRANSCRIPT ONLY]
J. Brar: I understand the size and quality of the building. My question is very simple — whether this property was put on sale locally and internationally at the same time or vice versa. Was it chosen to market the building first internationally or locally? I want to clarify that. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The building was made available for sale on a non-discriminatory basis locally, provincially, nationally and internationally — all at the same time. [DRAFT TRANSCRIPT ONLY]
J. Brar: I have this e-mail I would like to share with the minister, and I want to ask for a response from the minister. This is a real estate agent from the city of Surrey who was interested and who, according to this e-mail — not only one e-mail, but a lot of e-mails back and forth to ICBC — had a buyer for this building. [DRAFT TRANSCRIPT ONLY]
[B. Lekstrom in the chair.]
He was told that once the information was ready, information will be provided to him. This is what he is writing to ICBC. This is exactly what he wrote. I would like to just quote from him. [DRAFT TRANSCRIPT ONLY]
"Thanks for your reply. My partner talked to Mr. Kevin Michael, and he said to my partner that they are just working on the price and that once they are fine with the price, they will take this property to Europe for a month or two. After then, they will share the information locally." [DRAFT TRANSCRIPT ONLY]
I would like to ask for a response from the minister to this e-mail, which is actually a response from the company which was handed over this project for sale. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The member opposite, I'm sure, is aware that if this building actually sells, it will be the single largest real estate transaction in the history of the province of British Columbia. It is a big deal. [DRAFT TRANSCRIPT ONLY]
To engage in that process, one is involved in something that is somewhat different than selling your average home on any street in Surrey, British Columbia. You engage, for example, in the process of signing a confidentiality agreement, which allows you to receive certain information. [DRAFT TRANSCRIPT ONLY]I have no idea, in terms of the letter or the e-mail that the member has in his possession, whether this particular realtor seriously engaged in this particular process or not. But I can certainly confirm that all seriously interested parties were afforded a full, fair and non-discriminatory opportunity to be involved in putting forward proposals for the acquisition of that asset. [DRAFT TRANSCRIPT ONLY]
J. Brar: The question is still very simple — whether this property was put on sale in Europe first for two months or not? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: No, Mr. Chair. [DRAFT TRANSCRIPT ONLY]
J. Brar: Thanks to the minister for the clarification. My understanding is that this property was put on sale at the same time locally as well as internationally. That's what I take from the minister. If that is not correct, I would like the minister to correct that. [DRAFT TRANSCRIPT ONLY]
This is the e-mail which this real estate agent got. His name is Harpreet Purba, and he got an e-mail from Paul Reilly, who is the president of Surrey Central City Mall and the person who was kind of the lead person on the sale side. In his e-mail to this real estate agent, he writes back: "I'm sure that they will provide you with the proper information when it's ready." According to these people, they never asked anything else. [DRAFT TRANSCRIPT ONLY]
I understand the size of the property and the seriousness of confidentiality and all of that, but they were never told anything beyond whether the information was ready or not. I would like to ask the minister why these people were not given the opportunity or option. This property is a big property, and in order to be a part of this, you need to sign whatever the agreement is. But these people, according to this e-mail, didn't get that information. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Let me simply say this. When the property was put on the market, we had dozens and dozens of parties from around the globe who successfully engaged in the process. They signed the appropriate undertakings and they were provided with information. I can only surmise that if the process worked for all of these people, it should have worked for the member's constituent as well. [DRAFT TRANSCRIPT ONLY]
I can't speculate as to why that particular individual was unsuccessful in engaging in the process. I am satisfied that we undertook a process here that was completely fair and open and, in fact, available to everyone who was seriously interested — whether they were local, provincial, national or, indeed, international. [DRAFT TRANSCRIPT ONLY]
Obviously, given the size and scope of this transaction, it was necessary to be absolutely above and beyond reproach. I think we have certainly achieved that. [DRAFT TRANSCRIPT ONLY]
J. Brar: If that's the case…. I'm talking about e-mails back and forth, 20 e-mails. Not even one e-mail suggests that there is a process that he had to follow through — which I can understand, and which is a fair thing to do. I would like to ask the minister: if my constituent provides you with the full details of the information as to what he did and why he was not made part of the process, is the minister willing to look into his complaint or his concerns? [DRAFT TRANSCRIPT ONLY]Hon. J. Les: Certainly, we're quite open and eager, actually, to look into the specific concerns. As I said earlier, I think we have engaged in a process here that's been completely open and fair to everyone. There may well have been issues that prevented the particular realtor from being involved in this deal. I don't want to speculate as to what they may or may not have been, but if the member opposite wants to provide us with that information, we will follow through from there. [DRAFT TRANSCRIPT ONLY]
J. Brar: I appreciate the comments by the minister and the confidence the minister has in the fairness and openness of the process. The number of e-mails I have in front of me, which have been going between my constituent and ICBC — and the company that was hired by ICBC to sell this property — certainly seem to indicate that this person somehow was not offered the information of the process. That's why there are a lot of e-mails. [DRAFT TRANSCRIPT ONLY]
I would put on the record that of course it will be helpful for the people of British Columbia and for my constituents if the minister can clear the air. I will certainly ask my constituent to send this information to the minister. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Just one last quick question on the matter. Can the minister explain to us how many applicants ICBC received for the possible purchase of the property? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: We ended up, actually, with upwards of 50 qualified bidders in that process. [DRAFT TRANSCRIPT ONLY]
G. Gentner: I want to quickly move to the Olympic sponsorship — as the press calls it, the $35 million Olympic-size cash grab. [DRAFT TRANSCRIPT ONLY]
The purpose of licence plates during Expo 86, for example, was to advertise the fact through the so-called Spirit of B.C. flag — I don't know if you remember that — that signalled in the mind the up-and-coming event. But it didn't cost the taxpayers anything extra, so why should the Olympic plate? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The Olympic plate doesn't cost the taxpayer of British Columbia a nickel. [DRAFT TRANSCRIPT ONLY]
G. Gentner: The minister is correct. It's the ratepayer that's going to pay for it — correct. Why shouldn't the Olympic plate be given out free to customers so that everyone can market the games in B.C. and wherever they travel? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I'm not sure if I correctly heard the latter question. Perhaps the member can repeat it. [DRAFT TRANSCRIPT ONLY]
Let me just put on the record, as well, that the Olympic plate sponsorship arrangement does not cost the ratepayers of ICBC any money either. [DRAFT TRANSCRIPT ONLY]
G. Gentner: To the minister: How much extra does it cost to create an Olympic plate over an existing plate? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: It's amazing — the amount and type of information that we have available. I'll tell you what. I would have had no idea, but here we have the information. An Olympic plate costs $7.75 to produce. The regular plate costs $3.87. I guess that would be a difference of just under four dollars. [DRAFT TRANSCRIPT ONLY]
G. Gentner: And $35 million to the users. [DRAFT TRANSCRIPT ONLY]
The funding to insure the VANOC fleet of vehicles comes from the optional side and not the basic side. How much more will it add to the cost of optional insurance to pay for it? [DRAFT TRANSCRIPT ONLY]Hon. J. Les: I should point out that this whole Olympic sponsorship arrangement is actually part of the marketing effort of ICBC. But if you break it down, it amounts to something like 50 cents per year per ratepayer. [DRAFT TRANSCRIPT ONLY]
G. Gentner: This is an involuntary contribution, so won't you somewhat discourage those who disagree to buy insurance elsewhere? You're saying it's only 50 cents. That's all it's going to cost per insurer? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: It's a $6 million cost, and obviously ICBC — the board of directors — made the decision to engage in this program because they felt it would be helpful to advance the marketing of ICBC's products. Frankly, I agree with that. [DRAFT TRANSCRIPT ONLY]
So you take that $6 million cost over six years. That's $1 million a year, and if you spread that out over the number of ratepayers that ICBC has, you come up with the 50 cents per year figure. [DRAFT TRANSCRIPT ONLY]
That's part of ICBC's marketing program. The Olympics are the greatest opportunity that we in the province of British Columbia have ever enjoyed to market our province. Clearly, major corporations, of which ICBC is one, are enthusiastic about engaging in this marketing opportunity that is the Olympics. [DRAFT TRANSCRIPT ONLY]
The Olympics are certainly a sporting event, but they are one huge marketing opportunity for the province of British Columbia. ICBC wants to participate in that, and so they are. [DRAFT TRANSCRIPT ONLY]
They have this sponsorship arrangement with VANOC. It has been reviewed by the Ministry of Finance and, I believe, by the Auditor General as well. I'm quite serene in the fact that it is an appropriate arrangement. [DRAFT TRANSCRIPT ONLY]
One other thing to point out here. Nobody is obligated to buy an Olympic plate. It is entirely voluntary. If the member opposite does not wish to obtain an Olympic plate, that's fine. Many other thousands of British Columbians do wish to obtain an Olympic plate, and in fact already have obtained Olympic plates. So that is their sense of developing a sense of ownership and belonging to the Olympic experience in the province of British Columbia. [DRAFT TRANSCRIPT ONLY]
G. Gentner: ICBC is going to insure that the games' fleet of 4,500 GM vehicles is subsidized — for free. Just briefly explain to us how this is going to work. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: This insurance is obtained on a fleet-policy basis. ICBC essentially buys the basic insurance for this particular fleet and then manages the optional insurance product. The cost, as I have already indicated, is $6 million, and that of course is spread out over a period of six years. [DRAFT TRANSCRIPT ONLY]
As I have indicated, ICBC feels, and I certainly agree, that this is a very useful way for ICBC to extend its marketing. The member opposite, I'm sure, recognizes that ICBC is today in a competitive marketplace with respect to its optional insurance products. So obviously it wishes to take advantage of this marketing opportunity. [DRAFT TRANSCRIPT ONLY]When you look at it, for what is in the scheme of things an extremely minor contribution, ICBC receives access to what are arguably the most sought-after marketing assets in the world — that is, the Olympic rings. We have had corporate entities from around the world that have negotiated access to those marketing assets, but they have paid, in some cases, into the hundreds of millions of dollars for those rights and privileges. So the fact that ICBC was able to negotiate the arrangement that it has is great access, indeed, for a very modest contribution. [DRAFT TRANSCRIPT ONLY]
G. Gentner: I believe GM is the official auto of the games. Is that not the connection, yes? Therefore, will all GM products used by all Olympic sponsors of the games be compelled to buy optional insurance from ICBC, since you are the carrier of auto insurance for the games? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: No. As a matter of fact, optional insurance is exactly that. It is optional in the first place, and secondly, where you buy your optional insurance is up to the individual purchaser. VANOC is just another consumer out there. They can buy their optional products wherever they like. [DRAFT TRANSCRIPT ONLY]
G. Gentner: I'm surprised ICBC didn't include that as part of being the auto insurance carrier of the games. There are so many vehicles that are going to be insured for the games, and it is only going to have recognition for 4,500 vehicles of GM's. [DRAFT TRANSCRIPT ONLY]
On these GM cars insured by ICBC, where will the ICBC logo be located — since you're the sponsor? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: There will be no ICBC logos on these VANOC vehicles. The deal is all about giving ICBC access to the Olympic rings, not about giving the Olympics access to ICBC's logos. [DRAFT TRANSCRIPT ONLY]
G. Gentner: If ICBC didn't insure the Olympic fleet of vehicles, then the Olympic organizing committee would have to foot the bill. Is that correct? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Clearly, if ICBC had not negotiated a sponsorship arrangement with VANOC, then I am sure that another insurance company would have been glad to do so. As I have said, access to the Olympic rings for marketing purposes is a very sought-after commodity, and there is no doubt at all that VANOC would have gone shopping for an insurance sponsor if ICBC had not concluded an agreement with them. [DRAFT TRANSCRIPT ONLY]
G. Gentner: So ICBC has the world Olympic rights as the official car insurance of the games. What value does this international exposure give to ICBC? Does it sell insurance outside British Columbia? [DRAFT TRANSCRIPT ONLY]Hon. J. Les: Frankly, I'm not sure how useful this all is, but I'm sure the member knows and understands that ICBC sells auto insurance only within the boundaries of the province of British Columbia. But it is in a competitive marketplace with respect to its optional insurance. It competes with private sector insurance companies for the provision of optional insurance products to the automotive sector. In that context, it needs to not only provide good insurance products but also to market its products, as any other business is required to do. In that context, access to the Olympic rings is not a bad asset to have. [DRAFT TRANSCRIPT ONLY]
G. Gentner: In a press release, ICBC stated: "It operates in a competitive marketplace on the optional side of its business, and like other auto insurers, it is always looking for marketing opportunities to promote its products to current and potential customers." So can you explain the benefits? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Before this sponsorship arrangement with ICBC was worked out, our own consultants were telling us that the Olympics have always had an auto insurance sponsor and that if ICBC did not become that sponsor here, then someone else would have. [DRAFT TRANSCRIPT ONLY]
The member also might be interested to know that a 1-percent loss of market share impacts ICBC's bottom line by $5 million to the negative. Clearly, marketing is an important preoccupation for ICBC when only a 1-percent shift in the market has a negative impact to that effect. [DRAFT TRANSCRIPT ONLY]
I'm sure the member can understand quite clearly that a $6 million contribution spread over six years is a modest contribution indeed that obviously has the prospect of allowing ICBC to maintain its market share. [DRAFT TRANSCRIPT ONLY]
G. Gentner: In a press release, Jeff Schulz, VP of strategic marketing, said that it made good business sense to promote our products and services this way. However, since ICBC already has 85 percent of the optional market share, how much increased optional business do you expect to gain, beyond the 85 percent, for your participation? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The whole objective here is for ICBC actually to maintain its market share — grow it if possible, but maintain it in the first place. As the member may be aware, ICBC is entering into a new phase where optional insurance products will be more transparently competitive, and that obviously is good for consumers. But ICBC is going to have to sharpen its efforts to maintain its share of the optional business. [DRAFT TRANSCRIPT ONLY]
G. Gentner: That's interesting, because $35 million is being spent to maintain it, when you are the government that basically brought in private insurance on the optional side. So that's another cost because of the actions of the government. [DRAFT TRANSCRIPT ONLY]
I want to go back. I know the GM cars aren't going to have the logo, but how will those buying a licence plate? Will they have the ICBC name on it, or a logo, since it is the Olympic sponsor? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I'm confused by the member's line of questioning, frankly, at several levels. ICBC's logo has never existed on any licence plate — regular licence plate, vanity licence plate or Olympic licence plate for that matter. [DRAFT TRANSCRIPT ONLY]
The other thing I'd like to clarify with the member is his continuous reference to $35 million. He's making something up or reading the wrong briefing note or something like that. I'd be interested to know where that $35 million figure comes from. [DRAFT TRANSCRIPT ONLY]
G. Gentner: ICBC did a customer survey that found 160,000 households that expressed interest in getting the commemorative plates. When was this survey conducted, and who initiated it? [DRAFT TRANSCRIPT ONLY]Hon. J. Les: That survey was initiated by ICBC about a year ago. We can get the exact information for the member if he wishes to receive that. [DRAFT TRANSCRIPT ONLY]
G. Gentner: The survey was initiated, therefore, from the marketing team within ICBC. Is that correct? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Yes, that's true, Chair. I would indicate to the member opposite, given that he has a significant FOI request filed at the moment, that all of this information will be provided to him as a result of that FOI request. [DRAFT TRANSCRIPT ONLY]
G. Gentner: There's been so much happening in the last couple of weeks in the Leg. here regarding bureaucrats, and I'm certainly not here to besmirch the good character of Mr. Taylor. I just wanted some information. My understanding is that Mr. Taylor is a director or participates with VANOC. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Well, this is indeed unfortunate and is simply an extension of the opposition's efforts to smear people who contribute significantly to our province. [DRAFT TRANSCRIPT ONLY]
Mr. Taylor was a significant participant in the 1988 Olympics in Calgary, which I'm sure the member opposite may well remember. He has had no role whatsoever in the Olympics that we are about to hold in the province of British Columbia. That kind of silly speculation, frankly, is not appreciated. Frankly, I suspect the member would appropriately apologize for that kind of nonsense. [DRAFT TRANSCRIPT ONLY]
G. Gentner: The firm that did the survey in marketing — we still haven't established who that firm is. Could the minister elaborate? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I'm sorry that the member opposite hasn't apologized for attempting to besmirch a reputation here. [DRAFT TRANSCRIPT ONLY]
With respect to the question, we do not have that information here, but we will undertake to get that to the member either way, in terms of responding to the questions raised in this forum or by way of FOI requests. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Can the minister elaborate on how much money was spent on this survey or promotional budget? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Again, we don't have that specific information here, Chair. We will undertake to get that for the member. Again, this is information that is totally and transparently available. Given that the member seems to exhibit a keen interest in these matters, it will all be provided for him as quickly as possible so that he can amuse himself with all of those details. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Many people are interested in some details here. The question is: why can't you keep the plates as souvenirs when the Olympics are over? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Actually, the member is not completely up to speed, I suspect. Actually, people who purchase these plates will be able to retain the front plates as souvenirs. [DRAFT TRANSCRIPT ONLY]
G. Gentner: In the spirit of communications at ICBC, maybe there should be a big splash tomorrow in their marketing strategy. I'm sorry. I missed that point. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Are you going to buy plates, then? [DRAFT TRANSCRIPT ONLY]
G. Gentner: I might consider it, sure. [DRAFT TRANSCRIPT ONLY]
The question is: why did ICBC consider a second-tier sponsorship and not a first or even a third? Who in ICBC decided what tier? [DRAFT TRANSCRIPT ONLY]Hon. J. Les: This was a decision obviously made by the ICBC board of directors on advice from ICBC management. There are several tiers of sponsorship. Clearly, the very large international corporate sponsors — the likes of NBC, for example — would buy sponsorships in the range of several hundreds of millions of dollars. Clearly, that's not the league that ICBC ought to be playing in, unless the member opposite would like to suggest otherwise. [DRAFT TRANSCRIPT ONLY]
It was felt that tier-two sponsorship was the correct level of engagement for ICBC. When you look at the numbers and at the business case that's been made, obviously, it is a situation that pretty much recommends itself. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Well, ICBC for some time has been involved in all this, and I'm wondering why it hasn't really appeared in the service plan or even as part of a business plan that has gone public. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I guess it's going to come as a surprise to the member opposite that marketing has always been part of ICBC's business. It's part of their strategy to maintain their market share. [DRAFT TRANSCRIPT ONLY]
Let's be clear. Although he seems to be wavering a little in terms of his desire to obtain an Olympic plate or not, I suspect the member opposite is just simply against the Olympics. He's against the Olympic plate sponsorship, as he is against a whole bunch of other things. [DRAFT TRANSCRIPT ONLY]
I'm not sure that I will satisfy him today in his quest to somehow try to characterize all of this as unfortunate and unusual. In fact, it is good news. It's going to be part of a great Olympic experience in just over two years in British Columbia. [DRAFT TRANSCRIPT ONLY]
G. Gentner: The Olympic sponsorship is a new approach to marketing. How many more venues will be sponsored by ICBC in the future? We have the Memorial Cup, for example. Why not? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Well, clearly those will be ongoing decisions that will be made by the ICBC board of directors. I hope that going forward we have lots of top-drawer, high-level sponsorship opportunities not only for ICBC, but for the corporate sector generally to participate in, in British Columbia. I'm not sure whether that's the Memorial Cup, or whether that's the Police and Fire Games that are going to be occurring. There are numerous opportunities for sponsorship. [DRAFT TRANSCRIPT ONLY]
British Columbia is a place in the world where a lot of significant international events occur, and the corporate community often is very interested in engaging in those because it elevates them in the global marketplace. Obviously, ICBC will be participating in those wherever it is appropriate and wherever there is a business case that supports that. [DRAFT TRANSCRIPT ONLY]
G. Gentner: It's clear that perhaps we're going to see many corporations lining up for similar sponsorships in the next decade, if that is the new policy. [DRAFT TRANSCRIPT ONLY]
Before moving to the question of bonuses for exempt staff, I have to ask the question: what perks are involved with this tier? What are we expected to have from the sponsorship package — free meals, traffic, travel expenses, Olympic venues, tickets to figure skating games? Is there not some sort of package of venues that the corporation is expecting here? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Along with this package there is access to certain events and venues, but we will have to pay for them. The intention is that we will use those accesses to different events and venues as a part of ICBC's marketing strategy. [DRAFT TRANSCRIPT ONLY]
B. Ralston: Following on the previous discussion, will the minister then agree to table the details of that package in its entirety? [DRAFT TRANSCRIPT ONLY]Hon. J. Les: As I'm sure the member understands, this is actually an agreement between two parties — ICBC being the one party; VANOC being the other. I feel no particular reason why we should not be able to share that information, but clearly our other party to this agreement would have to agree as well. We would have to see whether VANOC was amenable to releasing all of the details with respect to that agreement, but as I stand here, I have no particular reason why I would not be amenable to that. [DRAFT TRANSCRIPT ONLY]
[A. Horning in the chair.]
B. Ralston: Will the minister agree to table the correspondence making that request within 30 days from today's date? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: As I'm sure the member is aware, I believe it's his colleague that has an extensive FOI request into the ministry and ICBC. So in the context of that, all of this information will be released. [DRAFT TRANSCRIPT ONLY]
B. Ralston: Given the answer to the question, can the minister then advise just when this information might be released from the most open and transparent government in the history of Canada? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: In accordance with government policy. [DRAFT TRANSCRIPT ONLY]
G. Gentner: On April 2, 2007, ICBC announced that it will no longer disclose the size of bonuses paid to executives because it doesn't want to risk giving the impression its managers are being overpaid. To the minister: are they? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The question is: are they being overpaid? I would say to the member opposite: certainly not. I think ICBC staff and management have served British Columbians exceptionally well. We have a public auto insurance company that I think is the envy of many. It has managed to keep rates low and stable. It is managing to do that in an increasingly competitive environment. [DRAFT TRANSCRIPT ONLY]
It's quite to the contrary if the member is suggesting that senior management are overpaid. There are lots of examples to indicate that, in fact, that is clearly not the case and that it's easier to make an argument that they are underpaid. [DRAFT TRANSCRIPT ONLY]
G. Gentner: If they're not overpaid, why don't you disclose the bonuses? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: There's certainly no intention of not making disclosure of all the things that ICBC needs to disclose, and the full remuneration — including both basic remuneration and bonuses — always has been and will be fully disclosed. I can read into the record, if the member wishes, some of the remuneration figures for the year ending 2005, which is the last year for which we have complete information. [DRAFT TRANSCRIPT ONLY]
[L. Mayencourt in the chair.]
We comply fully with government policy with respect to the disclosure of that information. There is certainly some discrepancy amongst the various Crown corporations within government in terms of exactly how that information is disclosed. [DRAFT TRANSCRIPT ONLY]We are currently working on developing a common template that will guide the disclosure of all of that information going forward so that ICBC, B.C. Hydro, the B.C. Lottery Corporation and other Crown corporations will be disclosing that information transparently and using the same principles and guidelines. [DRAFT TRANSCRIPT ONLY]
B. Ralston: The manner in which the salaries and total compensation package is disclosed now is a single figure, as I understand it. Really the issue is: what part of the total compensation package is a bonus? That's not revealed in the document the minister has open before him. [DRAFT TRANSCRIPT ONLY]
So the question is: is the minister prepared to reveal the dollar amount of the bonus for the senior executive team and the CEO? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: As I was explaining earlier, ICBC is one of a number of Crowns within the government of the province. The intention is that we have a common template for the disclosure of that information. When such a common template has been created, if you will, I think the member will find that basic salary information as well as bonus information will be recorded and reported separately. So certainly, that information will be available. [DRAFT TRANSCRIPT ONLY]
B. Ralston: It sounds like this proposed template is the subject of negotiation between a number of Crown corporations. While I have some faith in the ability of the corporations to move forward on this agenda, it doesn't sound like it's likely to happen very soon in the future. [DRAFT TRANSCRIPT ONLY]
Can the minister commit to directing or requesting that the Insurance Corporation of British Columbia issue the kind of salary figures, with the bonus number separate and the method by which the bonus is calculated, to the public within 30 days? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Actually, this is not a matter of negotiation between Crowns. This is a matter of government direction. Where government expects Crowns to uphold the standard of transparency, the government expects. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Express shops. How many ICBC-accredited express shops are there today in B.C as opposed to, let's say, five years ago? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: We don't have the exact numbers that the member opposite is looking for. We can get those numbers for him and supply him with that important information in the next number of days. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Therefore, for the record, I wouldn't mind if we could add on this information: how many applied last year, and how many were refused, looking for new owners for accreditation for collision repair business? How many were accepted? Could the minister agree to provide me that information, within the next couple of weeks? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: It would be a great pleasure to supply that information to the member opposite for his nighttime reading. [DRAFT TRANSCRIPT ONLY]
G. Gentner: How many ICBC supply numbers — of shops or mobiles — have been cancelled last year, and also within the last five years? [DRAFT TRANSCRIPT ONLY]Hon. J. Les: This is not information that we've got right here at our fingertips. We will get that for the member as soon as we can. [DRAFT TRANSCRIPT ONLY]
B. Ralston: I just wanted to clarify what the minister said a few moments ago about venue access in exchange for the plate deal. So who would get access to the venues? Would this be ICBC management, or would all of ICBC staff have that opportunity? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I'm certainly happy to clarify. First of all, this sponsorship package does not come with an allotment of free tickets. It gives ICBC the ability to purchase a certain number of tickets. When it does so, the intention is to make those tickets available for marketing purposes. They are not going to be freebies to ministers and senior ICBC staff. [DRAFT TRANSCRIPT ONLY]
B. Ralston: Is the minister saying then that ICBC management won't have access to this opportunity to buy tickets, or not? I'm not clear from the answer. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The plan is not to have these tickets available for staff of ICBC. The intention is to use them for marketing. I think I understand what the member is trying to get at here, but no, this is not a large giveaway of tickets to friends and insiders at ICBC. That's clearly not the case. [DRAFT TRANSCRIPT ONLY]
B. Ralston: Well, just in the context of marketing and creating good customer relations, who is the proposed target group that will be receiving this opportunity to attend Olympic venues? Obviously, tickets for these events will be in short supply, and they will be highly desired. I wonder if the minister could help me with understanding just who he thinks are going to use these tickets. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I'm not sure if I got the entire question here, but clearly the appropriate use for these kinds of tickets that ICBC will have access to are for contests, rewards, suppliers and brokers — those kinds of things. [DRAFT TRANSCRIPT ONLY]
If you have a broker that has really excelled and sold a lot of ICBC product…. You might have a contest ongoing for a period of time, where all brokers compete with one another or where all repair shops might compete with one another in any number of different areas. I'm sure the member understands how that might work and how that would be fairly distributed at the end of the day amongst that community. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Minister, what happened to the proposed Westside claims centre? Marion Phillips from ICBC stated there would be no movement in 2007. Can you explain why that is so, and when we will see that claims centre built? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Clearly, whenever a business like ICBC is considering its investment in infrastructure, you need to make those decisions carefully, based on emerging markets, population shifts and those kinds of things. [DRAFT TRANSCRIPT ONLY]Also, you need to take into consideration the expense. Claims centres are not cheap to build. ICBC is not yet ready to commit to a decision to build a claims centre at Westside. Obviously, those options remain open. But when a decision is made, it will be made in the context of a good, sound business plan. To date, the board has not seen fit to proceed based on the current realities in the marketplace. [DRAFT TRANSCRIPT ONLY]
G. Gentner: We'll quickly wind down here with ICBC. [DRAFT TRANSCRIPT ONLY]
There's a difference in how car insurance is provided in B.C. and Alberta, particularly with regards to optional car insurance. TILMA — here we go again — covers governments and their entities, which are defined in part 7 as meaning Crown corporations and entities that are owned by the Crown. Those that are a monopoly are exempted from the agreement, but the optional side is no longer a monopoly. [DRAFT TRANSCRIPT ONLY]
Can the minister tell this House how TILMA will affect optional insurance in British Columbia? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The member is correct. Where there is a Crown monopoly, and in this case that would be the basic insurance side of ICBC's business, that is indeed exempt from consideration under TILMA. [DRAFT TRANSCRIPT ONLY]
With respect to the optional insurance products, the business is optional, and insurance providers from Alberta — or anywhere else, frankly — can come to British Columbia and offer their optional insurance products. [DRAFT TRANSCRIPT ONLY]
G. Gentner: The minister is suggesting that he's anticipating that there will be no legal challenges to ICBC's provision of optional insurance and its relationship on the monopoly side. [DRAFT TRANSCRIPT ONLY]
[A. Horning in the chair.]
How much has been spent to defend ICBC's optional provision? Have you done any research at all? How much money has ICBC set aside for dispute resolutions relative to TILMA? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Zero. [DRAFT TRANSCRIPT ONLY]
G. Gentner: I'd like to now move on to the B.C. Lottery Corporation, if we can. I'd like to welcome the good people from the B.C. Lottery Corporation, gaming enforcement branch, etc. [DRAFT TRANSCRIPT ONLY]
Just a real quick little bit of housekeeping here. There are many venues that of course the president, CEO and staff have attended. I'd like to know how many members of the Lottery Corporation attended the Sports Betting and the Game seminar/convention at Munich, Germany, June 6 to 10. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: We don't have that information here, but we will find that information and make sure that it gets to the member soon. [DRAFT TRANSCRIPT ONLY]
G. Gentner: I know that Sam Huey went. Could the minister confirm whether or not the CEO attended? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: No, he wasn't there. [DRAFT TRANSCRIPT ONLY]
G. Gentner: That's somewhat of a relief, because those who attended were able to attend the World Cup soccer contest and have all the perks that were included there. I'm just interested in who took in the good old Bavarian fest — there, of course, in Germany. [DRAFT TRANSCRIPT ONLY]I want to know whether or not any of them attended the seminars relative to Internet gaming and sports betting. Could the minister possibly relay that information to me when or if he gets it soon? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The lottery business is no different than many other endeavours. People who are involved in management of that business need to avail themselves of information and insight wherever they can find that. [DRAFT TRANSCRIPT ONLY]
The Lottery Corporation is a member of the World Lottery Association. This is an organization that sponsors seminars and events on at least a quarterly basis in different places around the world. Eighty countries belong to the World Lottery Association, so it is an important source of information for people who are engaged in the lottery business throughout all these countries to come together, share information and learn from one another. [DRAFT TRANSCRIPT ONLY]
I think the member opposite mentioned something about whether or not the particular individual who attended last year in Germany would have gone to a session on Internet gaming. I do not know for sure whether he did or did not. However, I would have no difficulty with staff attending sessions of that nature because, clearly, it is incumbent on management within the B.C. Lottery Corporation to be as knowledgable as possible, even in areas where we have no intention of going. [DRAFT TRANSCRIPT ONLY]
G. Gentner: In today's broadcast news, particularly with the CBC, Ms. Sue Reid came forward with her FOI information on what's known as the lack of concern by casino employees regarding due diligence in marking gamblers. The FOI suggested that 85 percent of casino employees surveyed in 2004 said they believe that the gamblers themselves are responsible for seeking help for their problems, according to one of the corporation's internal documents. [DRAFT TRANSCRIPT ONLY]
Since then, what has the corporation done to change this policy? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Let me first of all say that given that we have a pretty extensive gaming enterprise through the B.C. Lottery Corporation, it is government's expectation that we ensure that gaming is carried on responsibly in the province. For the vast majority of people who participate in gaming, whether it's at casinos or by buying lottery tickets, they're able to do that as part of their entertainment, and no particular ill consequences flow from that. [DRAFT TRANSCRIPT ONLY]For a very small percentage of people, it can lead to gaming addictions issues. Clearly, we have a responsibility — whether it's at the B.C. Lottery Corporation or with the gaming policy and enforcement branch in my ministry — to ensure that we minimize to the greatest extent possible the number of people who fall victim to gaming addictions and, where people do succumb to those issues, that we are there to help them to the extent that we can. [DRAFT TRANSCRIPT ONLY]
With respect to the staff at the B.C. Lottery Corporation, they receive training on an ongoing basis. That training has been in place for several years now. The survey that the member referred to earlier is a somewhat out-of-date survey. [DRAFT TRANSCRIPT ONLY]
A lot of the training that I'm referring to has been going on in the last two years. Some 5,000 staff at the B.C. Lottery Corporation have so far been able to take advantage of that training. I am confident that that training is going to have the result of making them more positively responsive to people who exhibit gaming addictions issues. [DRAFT TRANSCRIPT ONLY]
G. Gentner: I take it that the minister is suggesting that all employees of casinos have been properly trained and can cut off problem gamblers when they see it, in the same way that a bouncer or someone working in the beverage industry can do the same. [DRAFT TRANSCRIPT ONLY]
However, that doesn't seem to be the case. I know there was a Mustel report, a survey that came out very recently. It's very subjective, and it really doesn't identify any corrections I can find in that survey. [DRAFT TRANSCRIPT ONLY]
How much money has been spent on determining what the benefits of gaming are in British Columbia? I mean, you must do your research. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I'm not aware that we've done a specific survey that would have as its core mandate trying to determine the benefit to communities. I am certainly happy to relate to the member the various benefits, as I see them, that flow to communities across the province. [DRAFT TRANSCRIPT ONLY]
I'm looking at figures that are for 2006-2007. In that year $144 million flowed to non-profit community organizations across the province, and $78 million flowed to local governments that are host communities to casinos and community gaming centres. Local economic development projects benefited by a factor of $14 million, and $5.2 million enhanced the horse-racing purse in the province. [DRAFT TRANSCRIPT ONLY]
There are apparently somewhere in the area of 10,000 people who hold direct jobs related to the gaming industry in the province. There is $147 million that goes directly into the health special account in British Columbia — so clearly it contributes directly to health services in the province — and then just over $600 million that goes into the consolidated revenue fund. [DRAFT TRANSCRIPT ONLY]As we know, if you use general government revenues as a guide, 43 percent or 44 percent of that goes into the provision of health care as well. Clearly, there are many benefits that flow in a variety of ways to British Columbia and British Columbians. I'm not exactly sure whether that was the nature of the member's question. But if his interest is where the benefits lie, I suggest that some of the things I have just enumerated are fairly substantial benefits. [DRAFT TRANSCRIPT ONLY]
G. Gentner: It's a leading question. I can grant you that. I'm going to lead to the next obvious one. How much money has the ministry spent on research on the social effects of gaming? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: We monitor the effects of casino operations, particularly in the lower mainland. As the member will be aware, that is an evolving thing. Where a number of years ago there were essentially no casinos, we now have casinos in several of the lower mainland communities — in some cases casinos that have only recently become established. [DRAFT TRANSCRIPT ONLY]
I'm thinking, for example, of a community like Langley. We have in place there an ongoing study to indicate what the social impacts might be of the casino being present in that particular community. [DRAFT TRANSCRIPT ONLY]
We're conducting what is, in effect, an ongoing impact study. It's managed by a steering committee comprised of staff from the gaming policy and enforcement branch in the ministry, the B.C. Lottery Corporation and the cities of Vancouver, Langley, Surrey and the township of Langley. It's fully funded by the province to the tune of $395,000. [DRAFT TRANSCRIPT ONLY]
G. Gentner: That's the case study for the province. Do I have that correct? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The impact study that I have just referred to actually involves the operation of four casinos in those communities that I have outlined. Clearly, the results of that study will be quite indicative of the impact of those casinos on their surrounding communities, as they involve a fair diversity of communities — all the way from Langley to Vancouver. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Very briefly on this, and then I'll move on. When do we expect to release this report? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The final report of the impact study is due out next month, in June. [DRAFT TRANSCRIPT ONLY]
G. Gentner: The responsible gaming people have been doing some work, and they referred — I quote the last survey of gambling, which was done back in 2002 — to those who lacked control of their participation in gaming and gambling as having a disorder. [DRAFT TRANSCRIPT ONLY]Why isn't this funding or some funding used to treat these disorders through the Ministry of Health, and the ministry of state for mental health and addictions? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I'm not sure that it matters much exactly where the funding comes from. I'm sure the member is aware that we have undertaken to make gambling addiction services available to whoever needs it at no cost to the individual. That budget has been set at $7 million for this fiscal year that we're in today. [DRAFT TRANSCRIPT ONLY]
That's, I think, a very significant commitment by this government to maintain the commitment that we've been consistent with all along — that anybody who needs gaming addiction treatment can get that treatment where and when they need it at no expense to that individual. [DRAFT TRANSCRIPT ONLY]
G. Gentner: With all due respect, it does matter where the money comes from and who the stewards of delivery of treatment are. Is it the pushers of gaming, or is it those in the mental health field who know how to treat it? [DRAFT TRANSCRIPT ONLY]
I want to also ask, since we've done all of this research regarding treatment and gaming and gambling: what is the average cost of rehabilitating a serious gambler — a person with serious gaming problems — or on top of it, the other tier which is known as just plain problem gamblers? What does it cost to rehab somebody? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: We don't have a particular figure here, although we can get that information for the member opposite. I gather what he's looking for is an average treatment cost. We'll have that information for him in the not too distant future. [DRAFT TRANSCRIPT ONLY]
G. Gentner: The proportion of British Columbians taking part in casino gambling activity has risen significantly from previous surveys. The average individual spending has increased among British Columbians who gamble. [DRAFT TRANSCRIPT ONLY]
To the minister: how much has the individual spending on gaming increased between 2005 and 2006? How much does the average British Columbian spend on gaming? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I'm not sure that we have numbers here that compare 2005 to 2006, but I do have the Canadian provincial gaming spend per capita. This information is from March 2005. I don't believe that's changed too much. [DRAFT TRANSCRIPT ONLY]
The average British Columbian spent $427 in gaming products. The average Albertan spent $720, significantly more than is the case in British Columbia. In Saskatchewan it was $684; Manitoba, $595; Ontario, $506; Quebec, $486; New Brunswick, $363; Nova Scotia, $505; Newfoundland, $529; Prince Edward Island, $331 — and the Canadian average being $516. [DRAFT TRANSCRIPT ONLY]
What those numbers tell us is that British Columbians spend well below the Canadian average in terms of their participation in gaming. There are only two provinces where the average spend is less than it is in British Columbia, those being New Brunswick and Prince Edward Island. [DRAFT TRANSCRIPT ONLY]When you look at the significant differential that exists between Alberta and British Columbia, where Albertans spend $720 per capita and British Columbians only $427, I think that relates to a basic decision that we have maintained in British Columbia. That is that video lottery terminals are not randomly available everywhere as they are in some of these other provinces such as Alberta, where you can play a VLT at any corner store, gas station, pub, bar and what have you. [DRAFT TRANSCRIPT ONLY]
We have made a deliberate decision in British Columbia that those kinds of games are available only in our casinos. Clearly, that is helping to keep gaming addiction issues in check. [DRAFT TRANSCRIPT ONLY]
G. Gentner: My understanding is that there are, as of the annual report of 2005 and 2006 — and maybe the ministry can correct me — about 30 contracted professional people who deliver counselling for problem gaming. Are these contracted professional people full-time, or are they part-time? How much of their professional time is actually used in the day for counselling problem gamers? [DRAFT TRANSCRIPT ONLY]
[B. Lekstrom in the chair.]
Hon. J. Les: Perhaps, just by way of update…. I think the member might be working from 2006-2007 numbers, which indicate we have 31. We're actually moving that up to 37. Just the other day we announced that there will be a further six individuals contracted to provide gaming addiction services. Almost all of these people work for us on a full-time basis. [DRAFT TRANSCRIPT ONLY]
G. Gentner: So these are professional psychologists? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: These are certified professional counsellors. [DRAFT TRANSCRIPT ONLY]
G. Gentner: I'll have to do some homework on that one. That hit me. I don't know what certification that really means. [DRAFT TRANSCRIPT ONLY]
These people spend 100 percent of their time, of their working day, with problem gamblers, if I have that correct. If I look at it, we had in 2005-2006 almost 7,500 help line calls, of which there were 3,500 or 3,600 referrals to the problem gambling program. Of that, only about 1,115 were admitted for counselling services. [DRAFT TRANSCRIPT ONLY]
So what happened to the other 2,400? Did they fall through the cracks? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: The reality is this. Quite often when people call the addictions help line, they are suffering from multiple addictions. So although they will be directed to assistance where they need it, it doesn't necessarily go to a gaming addictions counsellor. It might be somebody involved in a different area of help for these people. [DRAFT TRANSCRIPT ONLY]
It is also the case that not everyone who calls the help line actually is specifically looking for assistance. There are a variety of reasons why people call. I'm sure the member can understand that not every call that's made even to 911 is necessarily a call for the kind of service that that particular emergency setup is there to provide. [DRAFT TRANSCRIPT ONLY]G. Gentner: The minister's response — was that the ministry responsible for gaming and policy or the ministry responsible for the revenue stream from the B.C. Lottery Corporation? Which hat were you speaking out of? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Actually, I'm very difficult to split in half. I was talking about our government's responsible gaming strategy. It is a responsibility that we take very, very seriously. Whether we're talking about the gaming policy enforcement branch or whether we are talking about the B.C. Lottery Corporation, it is my expectation in both cases that we do the very best possible job we can to deal with any issues that arise from people's inability to partake responsibly in the gaming industry. [DRAFT TRANSCRIPT ONLY]
G. Gentner: According to statistics, 11 percent of B.C. adults are at-risk gamblers, 4.2 percent are moderate problem gamblers and 0.4 percent are severe problem gamblers. When you do the math for the B.C. adult population, this translates into a best estimate of gamblers of about 150,000 problem gamblers, including 136,000 moderate problem gamblers — of which we have close to 15,000 severe problem gamblers. [DRAFT TRANSCRIPT ONLY]
My understanding is you are spending about $4 million on assisting gamblers. My question is: how much of that is really going into counselling? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Some 90-plus percent of that money is going directly into counselling services. We have a very small administrative staff dealing with that particular area. [DRAFT TRANSCRIPT ONLY]
Just let me go back, though, to some of the projections that the member opposite was just sharing with us. It's a good illustration of how you have to be very, very careful when you're throwing numbers around. He extracted several percentages there and then applied them against the entire British Columbia population of 4.2 million people. [DRAFT TRANSCRIPT ONLY]
Well, I can come up with interesting numbers then too. But clearly, that kind of projection is entirely irrelevant and rather silly, if I can characterize it that way. It's of no particular usefulness whatsoever. Clearly, every man, woman, child and baby in British Columbia does not participate in gaming. [DRAFT TRANSCRIPT ONLY]
So you have to, I think, be a little more careful in terms of producing those kinds of projections, but I guess that would be inconvenient for members opposite who are trying to make an entirely different case. [DRAFT TRANSCRIPT ONLY]
G. Gentner: So I have it correct: 80 percent or 90 percent of the $4 million is spent on counselling — or thereabouts. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I said over 90. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Pardon me? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I said 90-plus. [DRAFT TRANSCRIPT ONLY]
G. Gentner: It's 90-plus. Okay. And the rest went to administration. How much money is spent on prevention, and how much money is spent on advertising to tell people the ills of gaming? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I don't have that specific number here. Again, I'm sure we can dig that out for the member and make it available to him. [DRAFT TRANSCRIPT ONLY]
M. Farnworth: I actually have a specific policy question and a problem issue that is a particular problem in a couple of areas but certainly in my community. That is around access to lottery funds in particular. [DRAFT TRANSCRIPT ONLY]School district 43, for example, unlike most school districts, does not have coterminous boundaries with the community that hosts a casino. As a result, within the city of Coquitlam, which has the casino and gets of course the revenue-sharing, schools are able to receive community grants which allow them to upgrade playground equipment. The result is that the other schools in the district outside the municipal boundaries don't have the ability to do that. This causes a severe inequity and a great deal of problem for a lot of parents. [DRAFT TRANSCRIPT ONLY]
Anyway, this issue has made its way to the provincial PAC — parent advisory council —and they have passed a resolution, which I will read for the minister. It says: "Be it resolved that the BCCPAC urge the Minister of Public Safety and Solicitor General to implement changes to the gaming regulations that prevent PACs from applying for a direct access grant for minor or major capital projects in order to replace school playgrounds." [DRAFT TRANSCRIPT ONLY]
Rationale: physical activity is required for children as much as academic activity. Schools located in communities where a casino's located may be able to apply for large grants from casino funds through the host community to help build a playground. This creates an inequity for students in areas where there is no casino, and all students in the province deserve equal access to adequate and safe playground equipment. [DRAFT TRANSCRIPT ONLY]
It's not one of those issues that is in terms of core funding from the Ministry of Education, but it is the type of issue that would be perfect for being able to access lottery grants for. So I'm asking the minister to recognize that this is a problem in a number of areas of the province, and I'm asking him to implement changes that would resolve these inequities. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I am generally aware of the situation, not only in terms of the inequity that exists, but also in the fact that there is a need to constantly be upgrading equipment in school playgrounds. I have had some discussion already with my colleague the Minister of Education. We're not yet at a point where we have a solution, but I can certainly let the member opposite know that I want to arrive at a conclusion because I think this is an area where we do need some improvements and equipment — in a large variety of schools, frankly, across the province. [DRAFT TRANSCRIPT ONLY]
This seems to me to be a good place to be sharing some of the benefits of the gaming industry in the province. So I would encourage all members to keep an ear open in the future, when hopefully we'll be able to address this in a positive way. [DRAFT TRANSCRIPT ONLY]
M. Farnworth: Thank you, Minister. I can assure the minister I will continue to follow the progress of this issue and raise it at other opportunities. [DRAFT TRANSCRIPT ONLY]
B. Ralston: I have a question about the speed cameras on the Pattullo Bridge. I'm going to switch gears slightly here. I don't know if…. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Are we done with lotteries? [DRAFT TRANSCRIPT ONLY]
B. Ralston: No. I think the minister can answer this without the benefit of staff given his position — unless he's changed dramatically. This issue has surfaced again in the news media, and I want to read to the minister a couple of brief quotations from senior police officers both in New Westminster and in Surrey. [DRAFT TRANSCRIPT ONLY]
The New Westminster Police Staff Sgt. Casey Dehaas — he heads the traffic enforcement unit there — says: "I firmly believe stationary traffic cameras for speed enforcement on the bridge would be really beneficial." He also goes on to comment that at the north end of the bridge, it's not possible to do it given the way the road is structured. He says: "It's almost impossible to do enforcement on our end. The members have tried it, and it's just too dangerous to try and work radar enforcement." [DRAFT TRANSCRIPT ONLY]
On the other side of the bridge, the jurisdiction of the RCMP, Surry RCMP Sgt. Paul Mulvihill, who is the detachment's NCO for traffic services, said he's measured northbound drivers at well over 100 kilometres an hour who know they've been clocked but actually speed up because they're immune. [DRAFT TRANSCRIPT ONLY]
The Surrey detachment devotes over 900 hours of policing time a year — 1/6 of the total traffic enforcement time in the municipality — and issued 3,000 tickets last year. What he says is: "I think the viable option we would like to see, and I know it's a political hot potato, is some kind of speed camera automated enforcement on that bridge. It would free up my members and give us almost 1,000 man hours to target the other problem areas of the city." [DRAFT TRANSCRIPT ONLY]Given that two senior police officers — one in New Westminster and one in Surrey…. At one point the minister's cabinet colleague the Minister of Transportation said that he thought it was an idea worth pursuing. Is the minister prepared to reconsider his position and follow the advice of these senior police officers, or does he just flatly disagree with them? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: I think it's been made abundantly clear ever since 2001 that we committed to British Columbians that we were getting rid of photo radar. We've done that, and we do not plan to reintroduce photo radar. [DRAFT TRANSCRIPT ONLY]
When the member refers to some 3,000 tickets being issued on the Pattullo Bridge over the last year, that would indicate to me that there is an awful lot of very good policing happening there. I'm not aware, particularly, of a political hot potato. I think there's good work being done there, and I salute that. [DRAFT TRANSCRIPT ONLY]
For a member in the Surrey detachment to suggest that the effort being expended on the Pattullo Bridge is somehow equivalent to 1/6 of their traffic patrol capability in the city of Surrey…. When you think about it, that's actually pretty ludicrous. That would suggest to me that they only have three members related to traffic in the city of Surrey. I'm sure somebody who knows nothing at all about the deployment of police resources would understand that that's simply not so in a detachment where there must be upwards of 500 sworn members of the RCMP. [DRAFT TRANSCRIPT ONLY]
The level of enforcement, obviously, has been stepped up, and the provincial government, as the member is aware, is making significant new resources available to communities. We have turned over $50 million worth of traffic fine revenue to communities so that they are able to access more police resources. We have, at no cost to communities, purchased a dedicated police helicopter that I'm sure is useful in terms of enforcing traffic on the Pattullo Bridge. We have put in place integrated road safety units of the various police detachments. [DRAFT TRANSCRIPT ONLY]
In fact, British Columbia is the most integrated policing jurisdiction in Canada. We have better working relationships between police departments. We have put in place a whole variety of measures that enable more effective policing in communities and between communities in such locations as the Pattullo Bridge. [DRAFT TRANSCRIPT ONLY]
We have been consistent on this. We will not be installing photo radar again in British Columbia. We scrapped it. We made that commitment, and it's going to stay that way. [DRAFT TRANSCRIPT ONLY]
B. Ralston: If I could just quote from Staff Sgt. Casey Dehaas of the New Westminster police traffic enforcement unit: "We're not asking for the full reintroduction of photo radar vans…It would be stationary camera enforcement at both ends of the bridge, with large signs warning drivers. Anything we can do to get drivers to slow down on that bridge will help save lives." [DRAFT TRANSCRIPT ONLY]
Clearly, the minister disagrees with the notion of saving lives that the police officer advances. Can he explain to the public why? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Obviously, the member and I don't necessarily disagree, but look, this discussion in the last several days came about as a result of a fatal accident on the Pattullo Bridge. I think it was about a week ago. The two contributing factors to that fatality that I've heard about were the fact that the person who died was not wearing a seatbelt and, secondly, that the vehicle containing the individual who died had in fact crossed the centre line. I don't know whether speed was a factor; I haven't heard about it. [DRAFT TRANSCRIPT ONLY]
The fact of the matter is that we're dealing with an old bridge built to standards that prevailed, I guess it was, in the 1930s or 1940s. It is the case that sometimes accidents happen for a variety of reasons, but I suspect strongly that when we have the kind of policing presence that is obviously being deployed at the Pattullo Bridge, it is a good and effective form of policing that is almost certainly going to produce safety benefits to everyone who uses the bridge. [DRAFT TRANSCRIPT ONLY]When you see a policing effort that produces 3,000 tickets in one year, those tickets will not have been generated just as a result of speeding. Those tickets will have addressed a number of driving infractions, and that is precisely the benefit that is obtained when you have police officers in person providing enforcement activity, as opposed to a camera taking a picture and generating a bill in the mail some weeks after the fact. [DRAFT TRANSCRIPT ONLY]
B. Ralston: It's clear the minister is not going to change his position. That's crystal-clear, and in my view, that's unfortunate. This bridge was built in 1936-1937. Will the minister commit to pursuing with the Minister of Transportation provincial cost-sharing with TransLink, who owns and operates the bridge now, to fund the construction of a new bridge in the near future? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: That is clearly a question that is appropriately put to the Minister of Transportation. [DRAFT TRANSCRIPT ONLY]
G. Gentner: To wrap up the business on casinos, I want to talk briefly about the unknown fund called the facility development commission fund, now referred to as the accelerated facility development commission fund. The Great Canadian Gaming Corporation has $37 million in this type of fund that's there for improvements. I know originally it was there for helping improve some of the old bingo halls. This is quite the little slush fund that's hanging around there relative to improvements at large casinos. Certainly, it doesn't necessarily work for those who are trying to compete against casinos. [DRAFT TRANSCRIPT ONLY]
My question to the minister is: can these funds accrued — and we're looking at…. At one time I believe it was 2 percent of the gross revenue. Now it's 3 percent of the gross revenue that can be put into this type of fund. Are these exclusively used only for slot machine areas of a casino, or can they be used for other expenditures, capital expenditures, within the hotel, within the convention centre, for restaurants, pubs, parking lots, etc? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Yes. [DRAFT TRANSCRIPT ONLY]
G. Gentner: Originally, this revenue was supposed to come back to the province, if I have it correctly, and now it's been changed from 2 percent to 3 percent. My question is: regarding the casino River Rock, how is it these funds could be used to purchase a parking lot off of Canada line? [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: First of all, let me clarify that these funds never did accrue back to government. They were always available for the improvement of casino properties in a variety of ways. The more directly that improvement was related to the casino property, the greater the percentage of money that was available from this fund. In some cases it went to a show lounge. In other cases it went to parking facilities. So that practice continues today. [DRAFT TRANSCRIPT ONLY]
C. Trevena: I have a couple of questions to the minister which I'm not sure he'll be able answer. It's not to do with lotteries. It's not to do with gambling. But they are a couple of questions which, if the minister isn't able to answer directly, whether he and his staff can provide me with the answers…. I would like to know how much money is going into Highway 16 projects this coming year, following last year's commitments. [DRAFT TRANSCRIPT ONLY]Hon. J. Les: I thank the member for the question. Actually, it's unfortunate. The staff that would have been able to provide me with that information was actually here yesterday. If the member has further questions dealing with Highway 16, perhaps she could put those questions, and I will undertake to make that information available to her. [DRAFT TRANSCRIPT ONLY]
Highway 16 and the issues surrounding the tragic disappearance of so many women there has certainly been a preoccupation of my ministry and the victim services branch. Our involvement there is ongoing, and I'm quite prepared to make whatever information the member wishes available to her. [DRAFT TRANSCRIPT ONLY]
C. Trevena: I thank the minister for that note. I will follow up with him and his staff. [DRAFT TRANSCRIPT ONLY]
The other question I have, which I'm sure the people who I needed to have the information were here yesterday…. It's the victim of crime surcharge fund. I wanted to know from the minister how much has been accumulated and how much of that is going to sexual assault centres. [DRAFT TRANSCRIPT ONLY]
Hon. J. Les: Again, the staff member who is involved in that was here earlier this afternoon. So I'll take that question as something we need to follow up and get that information back to the member. [DRAFT TRANSCRIPT ONLY]
M. Farnworth: With that, we can wrap the estimates of the Ministry of Public Safety and Solicitor General. [DRAFT TRANSCRIPT ONLY]
To make a few closing comments, I think there are a number of issues that we have explored in a wide variety of areas involving not just the Crown corporation responsibilities of the minister, which were done by the member for Delta North, but also some of the key program issues around public safety involving our prisons, involving the crystal meth program, involving victims of crime. [DRAFT TRANSCRIPT ONLY]
I know that during the course of these estimates, the minister indicated an undertaking to provide certain amounts of information or statistics — or what have you — so I look forward to receiving that. [DRAFT TRANSCRIPT ONLY]
At this time we are ready to pass the vote and move on to the next set of estimates. [DRAFT TRANSCRIPT ONLY]
The Chair: Seeing no further questions, I shall call the question on Vote 38. [DRAFT TRANSCRIPT ONLY]
Vote 38: ministry operations, $579,354,000 — approved. [DRAFT TRANSCRIPT ONLY]
Vote 39: Emergency Program Act, $15,630,000 — approved. [DRAFT TRANSCRIPT ONLY]
The Chair: At this time we will take a short recess and reconvene with the Ministry of Finance estimates. [DRAFT TRANSCRIPT ONLY]
The committee recessed from 5:43 p.m. to 5:47 p.m. [DRAFT TRANSCRIPT ONLY]
[B. Lekstrom in the chair.]ESTIMATES: MINISTRY OF FINANCE
On Vote 31: ministry operations, $54,555,000. [DRAFT TRANSCRIPT ONLY]
Hon. C. Taylor: If I may, what I would like to do is just introduce at least the individuals I have from ministry staff who are sitting with me now, and then as we make changes over the next weeks and months, I'll make the new introductions as we go along. [DRAFT TRANSCRIPT ONLY]
Of course, right beside me is Tamara Vrooman, who I think everyone knows now is the Deputy Minister of Finance. She also is secretary to Treasury Board and also CEO of PSEC. [DRAFT TRANSCRIPT ONLY]
Behind me we have Tara Faganello, and she is acting assistant deputy minister and executive financial officer. On my right we have Steve Klak, who is the acting senior financial officer. [DRAFT TRANSCRIPT ONLY]
I will not do a wordy introduction because the Minister of Finance actually has the privilege and opportunity in presenting the budget to talk about what our goals are, what our priorities have been and how we're approaching government. So I look forward to the questions from our critic. [DRAFT TRANSCRIPT ONLY]
B. Ralston: I appreciate the staff who have come here. I don't expect we will be too long today, but we'll doubtlessly make some progress tomorrow. [DRAFT TRANSCRIPT ONLY]
I wanted to start off by talking a bit about a response that the minister gave in question period on Thursday, April 19. This is a standard peroration that the minister sometimes engages in. [DRAFT TRANSCRIPT ONLY]
She was speaking of the 1990s. We were losing people, we were losing businesses, and unfortunately we lost head offices that will never come back. I take it that the conclusion she is seeking to point people to is that it was a cause-and-effect relationship between the then-government and the loss of head offices. [DRAFT TRANSCRIPT ONLY]
Is that the case, that in her view the NDP government caused the loss of head offices? [DRAFT TRANSCRIPT ONLY]
Hon. C. Taylor: I'm pleased to talk about this a little bit, even though the debate is to be about this year's Finance Ministry budget. But I will just in explanation say that in 1999, which was at the end of a number of years of difficult circumstances in British Columbia, I was asked to be a co-chair of a task force that was set up by the B.C. Business Council. [DRAFT TRANSCRIPT ONLY]
The task at hand was to travel around the province and ask people how we could get the economy back on track. The reason that we were asked to do this was because, in fact, we'd lost lots of jobs, business was not doing well, we were losing people, and we were losing head offices. [DRAFT TRANSCRIPT ONLY]
I spent a lot of time, along with a number of other people that fall, travelling around the province. We would go into small centres and set up in one of the local hotels or motels and just have two microphones on the floor. It was open to anyone to make presentations. [DRAFT TRANSCRIPT ONLY]Because I was in a situation of being the chair at many of these meetings, I had the opportunity to frame the debate. The debate really was to ask the question: how does British Columbia turn this economy around? How do we get back on track? How can we start to do things in a way that will be more positive for the economy? We put out a report at the conclusion, which was quite a thick report with a lot of ideas. [DRAFT TRANSCRIPT ONLY]
We separated out three that we put upfront in the report, which we believe to be non-controversial and the most important issues for government to face. The first was the taxation issue. It became very clear to us as we travelled the province that you cannot have punitive tax regimes and expect people to stay. Business, these days, is global. [DRAFT TRANSCRIPT ONLY]
We are sitting beside a province like Alberta, which is a tough competitor. If you had, as we did in the '90s, the highest marginal tax rate of any province in the country, or if you have high corporate tax rates, which we did — 16.5 percent — you just can't expect businesses to stay when they have so many options. [DRAFT TRANSCRIPT ONLY]
The second recommendation we had was on regulation. We heard story after story, as we went around, from small business people and from individuals talking about the hardship that had been caused by regulations, which were sometimes overlapping and sometimes contradictory but for the most part — for small businesses, in particular — a real burden. So that recommendation was to reduce the regulatory burden. [DRAFT TRANSCRIPT ONLY]
The third, which will be of interest for everyone to know, I'm sure, was that people really wanted to stop the confrontation. They really just wanted government to get on with the business of governing. We had the privilege of presenting this report to the Premier at the time, Ujjal Dosanjh and the Leader of the Opposition Gordon Campbell. [DRAFT TRANSCRIPT ONLY]
We did that. We put it on the table and really believed, having talked to unions and people from all political parties — from community leaders to professionals — that if we could somehow get at these issues, we'd be able to turn the economy around, which in turn would start to grow jobs in this province. [DRAFT TRANSCRIPT ONLY]
I think everyone now knows that we have taxes that are, for an individual earning up to $108,000 a year, the lowest taxes of anywhere in Canada. We now have a corporate tax rate reduced from 16.5 percent to 12 percent. We've increased the threshold for small businesses, at which they can continue to pay the lower rate, from $200,000 to $400,000. [DRAFT TRANSCRIPT ONLY]
On the regulatory side, we've cut our regulations by 41 percent, and in fact have been so successful at that that the federal government has asked British Columbia if we would help them do the same thing and look at their regulations as well. [DRAFT TRANSCRIPT ONLY]
So yes, I made those statements in the House. I stand by those statements, that the economy was in pretty rough shape and that it was important to have a different kind of policy initiative going forward in order to turn the economy around. I think most people would be very quick to say that the economy of B.C. is now doing very well. [DRAFT TRANSCRIPT ONLY]
B. Ralston: Well, my question was about head offices, and I don't think that question was answered. Does the minister agree or is prepared to state that the number of head offices has increased since the B.C. Liberals came to power in 2001? [DRAFT TRANSCRIPT ONLY]
Hon. C. Taylor: I really don't know what this has to do with the budget of the Finance Ministry, but that is not what I said. When you lose head offices, you can't get those head offices back. Companies take a long time to make a big decision like moving a head office. What we are hoping for, and we are seeing some of, are new kinds of head offices — a lot in the technology area. I see examples as I travel the province all the time, but I don't have specific numbers. [DRAFT TRANSCRIPT ONLY]
B. Ralston: Given that this was a statement made in the Legislature by the Minister of Finance on a matter of some economic importance, I think it's entirely appropriate that it be discussed here. Perhaps I can help the minister. The Business Council of British Columbia issued a paper called Corporate Headquarters and Head Office Employment in British Columbia: 2006 Update, based on a Statistics Canada survey which was issued in July of 2006. [DRAFT TRANSCRIPT ONLY]This survey found that the trend in head office employment in B.C. had seen a steep decline: "Between 1999 and 2005, employment at the B.C.-based head offices included in the Statistics Canada analysis tumbled by 28.5 percent." The same is also apparent when looking at head office employment in metropolitan British Columbia, which also fell 29 percent over the same period. [DRAFT TRANSCRIPT ONLY]
The report goes on to say: "Greater Vancouver also stands out as by far the worst performer among major…metropolitan areas in the trend in head office employment." That's continued, and the Business Council expresses a concern that that's continuing, that the decline continues. [DRAFT TRANSCRIPT ONLY]
Is the minister prepared to acknowledge, perhaps, that her very categorical and ideological statements that she just made about the reasons for head office decline are perhaps not accurate? [DRAFT TRANSCRIPT ONLY]
The Chair: Member and Minister, just one moment. I'm going to ask the member —versus attempting to carry on a debate that took place in the Legislative Assembly during question period — to try and refocus based on what we're here to deal with, which is the estimates of the Ministry of Finance. If you could put your question to the minister related to that. [DRAFT TRANSCRIPT ONLY]
B. Ralston: Frankly, Mr. Chair, I'm afraid that if that's a ruling, I respectfully disagree. The latitude that's ordinarily given in these kinds of debates is fairly broad. This is an economic matter. The minister speaks on behalf of the government on economic matters. This touches on the operation and the health, or not, of the B.C. economy. In my view, it's perfectly appropriate that this be discussed here. [DRAFT TRANSCRIPT ONLY]
If that's the case, I'd appreciate some further guidance from the Chair or from the Clerk as to what the limits are. If this kind of debate is not permitted here and I'm not permitted to question the minister here in these circumstances, where would the Chair then suggest that this debate take place? [DRAFT TRANSCRIPT ONLY]
The Chair: Member, it is not an official ruling I'm making. I was encouraging you to come back to Vote 31, which we are discussing, and to bring your questions to the minister based on that. [DRAFT TRANSCRIPT ONLY]
B. Ralston: The question stands, and I'm asking the minister to answer it. [DRAFT TRANSCRIPT ONLY]
Hon. C. Taylor: Hon. Chair, this government believes that a competitive tax policy is one of the ways in which we can encourage the economy of British Columbia. When you look at now having the lowest unemployment in 30 years at 3.9 percent, when you look at the increases in terms of non-residential construction, residential construction and retail business, I don't think there's anybody, except perhaps the member opposite, who doesn't believe that the economy has turned around from the '90s. [DRAFT TRANSCRIPT ONLY]
We do believe that our policies have been a big part of it, but this is for the budget debate, which has happened in the House. I'm very keen to talk about the Finance Ministry itself and about our expenses. [DRAFT TRANSCRIPT ONLY]
B. Ralston: Well, the minister references the corporate tax rate and concludes that that's one of the factors, although the study is very clear that the number of head offices in British Columbia has continued to decline, notwithstanding any changes that have been made in the corporate tax rate since 2001. [DRAFT TRANSCRIPT ONLY]
Has the minister or the ministry done any studies as to the efficacy of the cut in the corporate tax rate in attracting head offices to British Columbia? The evidence studied by Statistics Canada and by the Business Council of British Columbia suggests that notwithstanding those cuts, the number of head offices continues to decline. They're very worried by it, and they have some possible solutions for it, which the minister may not be interested in but which I can provide, if she is. [DRAFT TRANSCRIPT ONLY]
Hon. C. Taylor: Hon. Chair, I'm quite happy to give my budget speech again. I do think that the people of British Columbia…. We went through the '90s, and we had eight deficit budgets out of nine, when we saw people leaving our province, when we became a have-not province. That's not me making it up. This is the federal government's designation of what happened to British Columbia as a result of those policies. [DRAFT TRANSCRIPT ONLY]We have turned this around. We are now a have province. We've got 300,000 more jobs in this province, just in the last few years. We now have a more competitive taxation regime. I don't believe the job is finished. I think there's lots more work to be done and lots of work to be done in encouraging people to invest and locate here. [DRAFT TRANSCRIPT ONLY]
B. Ralston: One of the things that the Business Council of B.C. says is: "A necessary initial step is for public and private sector leaders to acknowledge that a problem exists." So apparently the minister is not prepared to acknowledge that a problem exists. [DRAFT TRANSCRIPT ONLY]
Apparently, since 2001 everything is peachy. That's not what the Business Council is saying. That's not what Statistics Canada is saying, and they do have a number of proposals to address that. Notwithstanding the corporate tax cuts, the number of head offices in this jurisdiction continues to decline and that is a serious problem. [DRAFT TRANSCRIPT ONLY]
Hon. C. Taylor: I don't think that the member opposite is listening. I said: "There is lots of work still to be done." [DRAFT TRANSCRIPT ONLY]
B. Ralston: Among her many duties, has the minister met with the Business Council of British Columbia to discuss the decline in head offices in British Columbia with a view to soliciting their advice on what the solutions might be? [DRAFT TRANSCRIPT ONLY]
Hon. C. Taylor: I have met with members of the B.C. Business Council from time to time on a number of issues. [DRAFT TRANSCRIPT ONLY]
B. Ralston: I guess that begs the obvious question. Has the minister asked the Business Council to provide their views on this and some of their solutions that they have in their paper, which is dated December 2006? [DRAFT TRANSCRIPT ONLY]
Hon. C. Taylor: We received this information, and like all of the information we receive from the community, business groups and unions, we thoroughly look at the research that is presented to us. As we present our budgets and as we actually build our budgets, we take all of these issues into consideration. [DRAFT TRANSCRIPT ONLY]
B. Ralston: I'm not quite sure what that response means, but there are some specific solutions proposed here. They don't appear to be related to the tax environment. Is the minister, as part of her duties as the chief economic spokesperson for the government of British Columbia, prepared to pursue those or not? [DRAFT TRANSCRIPT ONLY]
Hon. C. Taylor: I would like to make this the last question on the budget and get back to estimates. But I will say that Jock Finlayson, who is with the B.C. Business Council, actually sits on our economic advisory council and gives us advice in that format as well as the public format. [DRAFT TRANSCRIPT ONLY]
B. Ralston: I'll close off on this issue. The Business Council does have a number of suggestions, including setting up a central regional development agency that many other American cities…. Mr Finlayson in discussion mentioned Phoenix, Arizona, as one where there is a regional economic development agency, which is very effective — and doesn't exist in the lower mainland — and he talked about a number of other possible solutions. [DRAFT TRANSCRIPT ONLY]
I'd encourage the ministry, if this is the appropriate one, at least to have that discussion because it doesn't appear to be related to the environment that the minister spoke of in such ideological terms not too long ago. [DRAFT TRANSCRIPT ONLY]
I will move on. Looking at the budget document and the Estimates that we have before us…. On page 3 of the budget, in a letter signed by the deputy minister, the ministry spoke of ongoing negotiations with two major health regions, both Vancouver Coastal and Fraser Health. [DRAFT TRANSCRIPT ONLY]
They hadn't provided their sign-off on the budget at the time that it was tabled, so I'm wondering if the minister can advise what is the progress of those negotiations or those discussions with the health ministries in order to resolve the issues that were in doubt, as the deputy minister set out in her extraordinary note to the budget and fiscal plan? [DRAFT TRANSCRIPT ONLY]Hon. C. Taylor: Those questions should be put to the Minister of Health. [DRAFT TRANSCRIPT ONLY]
B. Ralston: The minister made a number of statements at the tabling of the second quarterly report and earlier about health care costs and the monitoring by the Ministry of Finance. With respect, it just isn't good enough to say that it's over to the Minister of Health. [DRAFT TRANSCRIPT ONLY]
She's the Minister of Finance. She's monitoring the ongoing development and expenditure in this very important part of the budget. So can the minister advise what reports she has received about the issues that are raised by Ms. Gruman in the preface to the budget? [DRAFT TRANSCRIPT ONLY]
Hon. C. Taylor: With respect, this is not the budget debate. This is estimates on the Finance Ministry. [DRAFT TRANSCRIPT ONLY]
The Chair: Member, just before I recognize you, I do want to encourage you…. There is latitude from the Chair, but this is on Vote 31, and this is dealing with the estimates for the Ministry of Finance. This is not budget debate. [DRAFT TRANSCRIPT ONLY]
B. Ralston: Looking at page 38 and page 39 of the three-year fiscal plan. Quoting from the bottom: "Two health authorities have also projected deficits for 2007-2008, totalling $119 million — Vancouver Coastal Health Authority, $54 million; Fraser Health Authority, $65 million." [DRAFT TRANSCRIPT ONLY]
Can the minister advise what the status is of those two budgets? [DRAFT TRANSCRIPT ONLY]
The Chair: Member, that would clearly be in the realm of the Ministry of Health estimates. Again, I will encourage you to direct your questions dealing with the Ministry of Finance estimates, which we are here dealing with today. [DRAFT TRANSCRIPT ONLY]
B. Ralston: I understand that the Ministry of Health is responsible for the expenditure of the funds. Does not the Ministry of Finance — in shaping its forward plan, certainly its three-year fiscal plan — have any monitoring of what's being developed and what's being spent? [DRAFT TRANSCRIPT ONLY]
The subject of the note at the outset of the budget was required by the Budget Transparency and Accountability Act, which is an act that the minister is responsible for. The deputy minister, in this extraordinary note, felt obliged by section 7(d) of that act, which the Minister of Finance — not the Minister of Health — is responsible for. [DRAFT TRANSCRIPT ONLY]
Those two health authorities haven't signed off on the budget, and the budget note is very clear. I'm asking what monitoring of those negotiations, or what reports, the Minister of Finance has received in looking out to the spending over this fiscal year? [DRAFT TRANSCRIPT ONLY]
The Chair: I see no further questions. [DRAFT TRANSCRIPT ONLY]
Member? [DRAFT TRANSCRIPT ONLY]
B. Ralston: I take it the minister is not prepared to answer that question. I gather that. That's unfortunate, but I'll take it up with my colleague and the critic for the Ministry of Health. I am of the view that the Minister of Finance, given the statements that she's made publicly about health care spending, has some obligation in this process to put her views on the record and doesn't appear to be willing to do that. [DRAFT TRANSCRIPT ONLY]
In a news conference last December at the tabling of the quarterly report, the minister spoke of cost pressures on the budget of some $400 million. I'm wondering if the minister can explain what the source of that calculation was. Was it from a document produced by the Ministry of Finance, or was it a document produced by the Ministry of Health? [DRAFT TRANSCRIPT ONLY]
Hon. C. Taylor: I am repeatedly on the record at the budget debate at the first quarterly, at the second quarterly, at the third quarterly on the budget. [DRAFT TRANSCRIPT ONLY]
Today we are here to discuss Vote 31, which is the running of the Ministry of Finance. [DRAFT TRANSCRIPT ONLY]B. Ralston: Once again, I take it that the minister is not prepared to answer that question, and I think that's unfortunate. Within the confines of the Legislature and this process, I think there's certainly some room for a response to those important public pronouncements that the minister seemed so willing to make but does not wish to be accountable for here in the Legislature. [DRAFT TRANSCRIPT ONLY]
I think the silence is telling, but if that's the approach of the minister, then so be it. The public will have to judge whether that's the right approach or not. [DRAFT TRANSCRIPT ONLY]
If I could move to another area, then: the trade and convention centre extension project. In the budget on page 62, table 1.23, "Capital projects greater than $50 million," the budget number there is $281 million for the provincial share of the convention centre extension project. [DRAFT TRANSCRIPT ONLY]
Can the minister advise if there has been any change in that projection? [DRAFT TRANSCRIPT ONLY]
The Chair: Member, once again, the debate you're on is a budget debate, and what we are here for is the Ministry of Finance estimates based on the ministry operations. That is still before the House — the Ministry of Tourism is where that would fall under. I would encourage you to direct your questions through that process during those debates or to one of your colleagues who would be the critic for that. [DRAFT TRANSCRIPT ONLY]
B. Ralston: Presumably, the Ministry of Finance is going to make an allocation out of contingency for cost overruns for the trade and convention centre extension project. What I'm interested in the minister answering is: what is the latest information that she has received — as the Minister of Finance, monitoring what that expenditure is? [DRAFT TRANSCRIPT ONLY]
Hon. C. Taylor: These are budget questions. They are questions for different ministries, not Finance Ministry. The convention centre is under the Ministry of Tourism. [DRAFT TRANSCRIPT ONLY]
The Chair: Member, noting the hour. [DRAFT TRANSCRIPT ONLY]
B. Ralston: It seems a little early, perhaps, Mr. Chair. But following your direction, then, I move that the committee rise, report resolution and completion of the Ministry of Public Safety and Solicitor General and progress on the Ministry of Finance, and ask leave to sit again. [DRAFT TRANSCRIPT ONLY]
Motion approved. [DRAFT TRANSCRIPT ONLY]
The committee rose at 6:14 p.m. [DRAFT TRANSCRIPT ONLY]
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