Heiltsuk LT BCUC July 8-07 Ocean Falls€¦ · Heiltsuk/Shearwater Documents in Support of Motion...

W E I S B E R G L A W C O R P O R A T I O N

2730 Ailsa Crescent

North Vancouver, B.C. V7K 2B2 Reply to: Fred J. Weisberg

Telephone: (604) 980 – 4069 Fax: (604) 980 – 6357 Email: [email protected] BY E-MAIL and MAIL July 8, 2007 Attention: Robert Pellatt Commission Secretary British Columbia Utilities Commission 6th Floor, 900 Howe Street Vancouver, B.C. V6Z 2N3 Dear Sirs/Mesdames: Re: BCUC Order No. G-36-07 - Project No. 3698368 British Columbia Hydro and Power Authority (“BC Hydro”) 2007 Rate Design Application (“RDA”) Heiltsuk Tribal Council and Shearwater Marine Limited Documents in Support of Motion for Production of Documents

We are writing to provide copies of two documents, as a courtesy, in advance of the hearing on Monday July 9, 2007 of our Motion for Production of the BC Hydro/CCPC contracts. We will make available 20 paper copies of this letter and each of the two documents (selected excerpts only for Hansard) at the hearing. The two documents establish an additional element in our prima facie case that BC Hydro’s rates in the “Bella Bella NIA” are unjust, unreasonable, unduly discriminatory or in contravention of the Utilities Commission Act (“UCA”). Recognition of access to abundant inexpensive power from hydroelectric generation in Ocean Falls dates back to at least 1903. In 1972, the provincial government bought the existing hydro dam and four large generators “in perfect working order”.1

1 Notably, the transmission line connecting Ocean Falls and Shearwater was constructed later so it was not part of the asset package originally purchased by the provincial government.

C23-13

bharvey

BCH 2007 Rate Design

Heiltsuk/Shearwater Documents in Support of Motion for Production of Documents July 8, 2007

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Thus, in the absence of evidence to the contrary, the starting presumption should be that CCPC began operations in 1986 or 1987 with useful existing facilities (but not the transmission line) on an established site with proven abundant hydro resources renowned for the production of inexpensive power. We submit that such a presumption supports a determination by the Commission to order the production of the BC Hydro/CCPC EPA, lease agreement and related agreements. BC Hydro’s rates in the “Bella Bella NIA”2 are the highest rates in B.C.; Ocean Falls appears to have the oldest and lowest cost hydro resource in B.C.

We submit that the disparity between the highest rates and the apparently lowest cost strongly suggests that BC Hydro’s rates in the “Bella Bella NIA” are unjust, unreasonable, unduly discriminatory or in contravention of the UCA and requires an examination of the requested contracts.

The first document is titled “A Brief History of Ocean Falls”.

We will make reference to the first two paragraphs of that document stating:

"The community of Ocean Falls is located at the head of Cousins Inlet, near Bella Bella. The first known inhabitants of the area were the Kwakwa (Kwakiutl) and the Nuxalk (Bella Coola), and their seasonal village at the base of the falls was called "Liak" meaning falls.

The site has always been known for its overabundance of rainfall (172 inches annually), and it was the potential for easy access to large amounts of fresh water that prompted the first commercial interests to concentrate on the area. In 1903, the Bella Coola Pulp and Paper Company was surveying the area for timber and was impressed by the site. Inexpensive power could be generated from the enormous waterfall at the head of Cousins Inlet, and the water in the lake (Link Lake) above the falls was pure enough to be used in pulp making without filtration."

We will also reference the last full paragraph on page 2 of that document stating:

"By the 1970s, the mill facilities at Ocean Falls were old, and the isolation of the site added to the costs of running the mill. In a move to cut costs and increase profits at other mills, the mill owner (now Crown Zellerbach), announced that the operations at Ocean Falls would be phased out by March of 1973. As operations gradually wound down, the community itself also started to erode. Jobs were being lost, people were moving away, and shops and businesses began to close.

2 And in the eight NIAs.


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However, two weeks before the impending closure of the mill, the provincial government stepped in and bought the entire town for a reported $1 million, and set up the Ocean Falls Corporation." (emphasis added)

We will also intend to make reference to Hansard, 1983 Legislative Session: 1st Session, 33rd Parliament, for Tuesday, August 9, 1983. In particular, we will reference page 715, which quotes Mr. Lockstead as saying:

“The recommendation which was favoured by myself and the managers of the Ocean Falls Corporation at the time was a combination of a new kraft mill at the Ocean Falls Corporation site coupled with a plywood mill, because of the cheap electrical energy. Right now, there's literally . . . . Every time the price of a barrel of oil goes up, that hydro power, which is going over the dam now and not doing anything, becomes more valuable. In other words, Ocean Falls had access, at that time, to cheap electrical energy. It is now and has for several years been going to waste.” (emphasis added)

We will also reference Hansard page 721, further quoting Mr. Lockstead as saying:

“But I'm serious when I tell you that over the 11 years that I have attempted to serve the people in Ocean Falls . . . . We've attempted to maintain that community, which contributed greatly to the economy of the province - a community that should stay in operation. There are a lot of things that can be done even at this late date. Utilizing the recommendations in the Simons report - a summary of which I have here - could return that community . . . . Because of the cheap electricity, the cheap energy costs there - the dam is in place; the four large generators are in perfect working order; the hospitals, the modern school, library and recreation centre .... All of those things are in place in that community. In my view, to close down that community is a crime against the people of British Columbia.” (emphasis added)

Finally, we will reference Hansard at page 723, quoting Ocean Falls Corporation manager Mr. Ted Vesak as saying:

“For the $1 million paid to Crown Zellerbach by the provincial government, the government received a five-storey hotel, a wood mill, a groundwood mill, a newsprint mill, schools, apartment buildings, subdivisions, a hydro dam, commercial buildings, recreational facilities and 45 acres of townsite valued at close to $50 million." (emphasis added)

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The Heiltsuk/Shearwater wish to reserve the right to make further submissions, as directed by the Commission with respect to the matters discussed herein. Yours truly, (original signed by) Fred J. Weisberg Barrister & Solicitor Weisberg Law Corporation cc. BC Hydro

Registered Intervenors Mr. A. Knott, CCPC

7/8/07 12:19 PMOCEAN FALLS HISTORY - COMMUNITIES IN B.C. - BC ARCHIVES TIME MACHINE

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A Brief History of Ocean FallsThe community of Ocean Falls is located at the head of Cousins Inlet, near Bella Bella. The first knowninhabitants of the area were the Kwakwa (Kwakiutl) and the Nuxalk (Bella Coola), and their seasonalvillage at the base of the falls was called "Liak" meaning falls.

The site has always been known for its overabundance of rainfall (172 inches annually), and it was thepotential for easy access to large amounts of fresh water that prompted the first commercial interests toconcentrate on the area. In 1903, the Bella Coola Pulp and Paper Company was surveying the area fortimber and was impressed by the site. Inexpensive power could be generated from the enormous waterfall atthe head of Cousins Inlet, and the water in the lake (Link Lake) above the falls was pure enough to be usedin pulp making without filtration. The Company acquired the rights to 260 acres of land extending fromCousins Inlet to Link Lake and obtained the necessary leases from the provincial government.

In 1906 a crew of 25 men arrived by steamer, and began clearing the land for a townsite. By 1909, OceanFalls was starting to take shape. A sawmill was in production, a store was built, school classes for 10 pupilswere being held on the second floor of the store, and a one-bed hospital operated out of a small building onFront Street. By 1910, a bridge had been built over the river, rough roads were in place, a number of houseshad been put up, and a hotel was being built. Construction of a pulp mill and a dam at the head of the fallswas also underway. In 1911 the whole province, including Ocean Falls, was enjoying an economic boom.

The Company relied heavily on handloggers to supply them with logs. These men often worked alone,sometimes in pairs, felling trees in the woods and getting them down to the water for transport to the mill.Over time, skids, horses, a mechanical engine called a "donkey engine", and logging "railways" were allused get the logs out of the forest, but it was tough and dangerous work.

The pulp mill went into production in 1912, but by this time a recession was beginning. The timber holdingsheld by the Company turned out to be unsuitable for large scale operations, and in March 1913, Ocean FallsCompany Limited went into receivership. In 1915, a new company, Pacific Mills Limited took over theoperation. A large amount of equipment had already been brought in for existing mill, but the new Companywas planning a state-of-the-art million dollar operation, and it sought access to large amounts of timberfrom the provincial government.

In 1916, the community needed improvements to support the people living there. A doctor was brought tothe town, and a 25 bed hospital was built, and staffed with two nurses. The Company paid 50% of the costfor medical treatment for employees and their families. The school, closed in 1913, re-opened and aprincipal was appointed. By 1917, the face of the town had changed dramatically. A new fire hall, postoffice, customs building, and dock warehouse had been built. In order to house the new workers and theirfamilies, additional bunkhouses and apartments had been built by the Company.



World War One, created demand for strong but lightweight wood for the construction of airplanes. The sitkaspruce of British Columbia's north coast was well suited for this purpose, and all available sawmills wentinto full production to meet the need. Work continued feverishly to get the new pulp mill into production.The first paper making machine, No. 3, was fired up on June 1st, 1917, and the newsprint began to roll outat a rate of 600 feet per minute. The war also created labour shortages, and Chinese, Japanese, and EastIndian workers were brought into Ocean Falls to meet the demand.

By 1918, the celebration of Dominion Day demonstrated the strong sense of community that had alreadydeveloped in Ocean Falls. Dominion Day would remain an important social event for the town. Also in1918, the effects of the world-wide flu epidemic were minimized in Oceans Falls in part due to the isolationof the community, but also due to the Emergency Fund that was established to care for those individuals onthe sick list.

Church services were initially held in the basement of the schoolhouse, and everyone was welcome toattend. The first church was built in 1921.

A wide range of social activities developed, and clubs of all sorts were formed. Band concerts and theatricalproductions were given, and sports were popular, particularly baseball. Ocean Falls also had one of thefinest swimming pools in British Columbia, and the town sent many champion swimmers to compete forCanada in the British Empire Games, the Pan-American Games, and the Olympics.

Through the depression years of the 1930s the mill fought for survival by cutting operating costs and wages,focusing on "efficiency" measures, and reducing overall production. By the late 1930s unions started toform at the mill. However, the Second World War brought increased demand for sitka spruce, which led tolabour shortages since two hundred employees were serving in the Canadian armed forces. The mill alsoemployed a large number of Japanese workers, who were now uprooted from their homes and jobs at OceanFalls and sent to "internment" camps in the interior of the province.

The 1950s and 1960s saw continued growth and expansion in the community. This growth was interruptedby three major events; an industry-wide strike in 1957, and two disastrous landslides caused by rainfall thatwas excessive even for rainy Ocean Falls.

By the 1970s, the mill facilities at Ocean Falls were old, and the isolation of the site added to the costs ofrunning the mill. In a move to cut costs and increase profits at other mills, the mill owner (now CrownZellerbach), announced that the operations at Ocean Falls would be phased out by March of 1973. Asoperations gradually wound down, the community itself also started to erode. Jobs were being lost, peoplewere moving away. and shops and businesses began to close.

However, two weeks before the impending closure of the mill, the provincial government stepped in andbought the entire town for a reported $1 million, and set up the Ocean Falls Corporation. No provision wasmade to secure a supply of timber for the mill through timber grants, so the new corporation was forced tobuy logs on the open market adding to the costs. Though production remained high, profits decreased forvarious reasons including weak markets, rising cost of materials, machinery problems, labour unrest, andhigh interest loans. In early March of 1980 the government was forced to announce that the entire mill wasto be closed within three months. On May 31, 1980 the mill at Ocean Falls was closed and the last employeeleft.

As the Ocean Falls Corporation was being dismantled, the equipment auctioned off, and buildings



demolished, the community itself began to take more direct control over its future. Although there were just50 residents, the Ocean Falls Improvement District was established. The community worked with thegovernment to save 60% of the buildings in recognition of their historical value. By 1996 the number ofresidents had increased to 150 people; many attacted by the charm of the small town, it's quiet atmosphere,and unique heritage.

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7/8/07 2:15 PMHansard -- Tuesday, August 9, 1983 -- Afternoon Sitting

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1983 Legislative Session: 1st Session, 33rd ParliamentHANSARD

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

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY(Hansard)

TUESDAY, AUGUST 9, 1983

Afternoon Sitting

[ Page 701 ]

CONTENTS

Routine Proceedings

Oral Questions

Political contributions by McKim or Vrlak Robinson. Mr. Barrett –– 701

Tenure for contract positions. Mr. Nicolson –– 702

Termination of community involvement program. Mr. Barnes –– 702

Craig Aspinall and Associates Ltd. Mr. Hanson –– 702

Harbour Board Repeal Act (Bill 25). Second reading.

Hon. Mr. Phillips –– 703Mr. Lea –– 704Mr. Reynolds –– 709

Ocean Falls Corporation Repeal Act (Bill 30). Second reading.

Hon. Mr. Phillips –– 712Mr. Lockstead –– 713

Tabling Documents

Ministry of Tourism annual report, 1983.

Hon. Mr. Richmond –– 726

The House met at 2:05 p.m.

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Prayers.

HON. MR. GARDOM: Mr. Speaker, Mr. David Jacobs and his daughter, Miss Wendy Jacobs, areobserving our procedures here this afternoon. Miss Jacobs is taking part in the 1983 Pacific Coast JuniorTennis Championships being played at the Racquet Club of Victoria. I'm sure that all members would like towish these two very good people from the great riding of Vancouver-Point Grey a very warm welcome.

MR. LOCKSTEAD: Mr. Speaker, visiting with us in the Legislature this afternoon is a constituentof mine from Gibsons on the beautiful Sunshine Coast, and a star reporter for the Coast News, Mr. GeorgeMatthews. I ask the House to join me in welcoming him.

MRS. JOHNSTON: Mr. Speaker, visiting with us in the Speaker's gallery today from Holland areIvone Broshuis and Lawrence Rack. They are accompanied by one of my constituents from Surrey, Mrs.Rita Waenink. I would ask the members to welcome them please.

Oral Questions

POLITICAL CONTRIBUTIONS

BY McKIM OR VRLAK ROBINSON

MR. BARRETT: Mr. Speaker, I have a question for the Provincial Secretary. Can the ProvincialSecretary advise this House whether to his knowledge McKim Advertising or Vrlak Robinson have givenany political contributions to any political party, federally or provincially, during the period they've beenemployed by the provincial government?

HON. MR. CHABOT: Not to my knowledge.

MR. BARRETT: On a supplementary, has the Provincial Secretary checked this question?

HON. MR. CHABOT: The Leader of the Opposition asked me if I was aware of whether acontribution had been made by McKim Advertising and Vrlak Robinson. I gave him a straightforwardanswer: not to my knowledge.

MR. BARRETT: In light of the investigation by the Attorney-General over the allegations made byMs. Morrison of funds gone through these two agencies, does the Provincial Secretary feet that he shouldinquire as to whether or not those two agencies have given political contributions to any party?

HON. MR. CHABOT: I'm not aware of any requirements for public disclosure of campaign fundsin British Columbia.

MR. BARRETT: Since public moneys may indeed have been involved as an answer to transfer ofthis money, does the Provincial Secretary think it would be necessary to request that the Attorney-Generalcheck this particular point to see whether any funds . ?

AN HON. MEMBER: Ask the Attorney-General.

MR. BARRETT: I would ask the former Attorney-General, who failed in his job, if I consideredthat important, but I'm asking the Provincial Secretary.



MR. SPEAKER: Order, please. Hon. members, we are in question period.

MR. BARRETT: Mr. Speaker, $5.5 million is unaccounted for by these two agencies. At a time ofrestraint - let alone in good times - we want to know whether or not any money out of the taxpayers' pocketshas been laundered through these agencies to a political party. I asked the Provincial Secretary that question.

My final supplementary: considering the auditor-general's report, would it not be a wise move forthe government, through the Provincial Secretary or the Attorney-General, to doublecheck to see whethereither McKim or Vrlak Robinson have given money to any political party, and if they have, where thesource of this money came from?

HON. MR. CHABOT: The Leader of the Opposition is asking me a question that would probablybe more properly put to the Attorney-General. He's attempting to influence one minister to ask anotherminister a question. If he has a question of a particular minister, he should address that question to thatminister and not attempt to influence one minister to ask a question of another minister, who might have toask another minister to bring the question back to this minister to give an answer to the Leader of theOpposition. So if he really wants to ask a question of the Attorney-General, I suggest he address thatquestion to him without all of the political rhetoric, political insinuations and the misleading and misquotedstatements that he's putting forth at this time in attempting to convey an erroneous impression in the mindsof the people of this province.

[2:15]

MR. BARRETT: I want to thank the out-of-order minister for his out-of-order answers –– 1, too,Mr. Minister, were I in the same situation, would answer the same way. It's very humorous; I enjoyed it.However, we're dealing here with a report from Ms. Morrison of $5.5 million of taxpayers' money that hasunaccountably gone to these two agencies. You are the minister responsible, and I ask you: do you not thinkit is a necessary question to ask McKim Agency and Vrlak Robinson whether any of that unaccounted-for$5.5 million has been contributed to any political party? I ask you, Mr. Minister, as the minister responsible,as Provincial Secretary.

HON. MR. CHABOT: That's a very interesting question with a great variety of politicalinsinuation, and the only conclusion I can come to is that by the question, the member is attempting toconvey a false impression. He's attempting to suggest that public funds have been misused, that public fundshave been used for a particular political party in this province. I kind of resent the insinuation being left bythat leader of the opposition - that waning leader of the opposition, I might say, who's leaving his post a fewmonths down

[ Page 702 ]

the road, and not too soon. But I want to say, to satisfy the leader of the opposition's curiosity, thatI'm prepared to take that question as notice with a view to securing and delving into the intricacies of thefinancing and conveying of funds to these two firms, to see whether any of those specific funds have filteredor done anything else as far as any political party in this province is concerned.

MR. BARRETT: I'm pleased that we have a modification of the original answer by the minister,whose verbosity is humorous but sometimes revealing. First he says he doesn't know; then he claims it's afalsehood. Thirdly, now he wants to dig at his notes. While he takes this matter as notice, will he assure the




House that in this matter that he's taken as notice he will consult with the study and investigation being doneby the Attorney-General? And in conclusion, does the minister not seriously think this is indeed a matter forpolice investigation rather than political investigation?

HON. MR. CHABOT: As I said a little earlier, from time to time the leader of the opposition asksquestions of the wrong minister, and he's asking a question of the wrong minister at this time. If he'ssuggesting that there's a need for police investigation of a particular allegation which he's prepared to makein this House, then I suggest that he ask that question of the proper minister, because I'm not the minister incharge of the police force in British Columbia. I'm sure that the leader of the opposition recognizes thatfully. Therefore, if he wants to suggest that there should be a police investigation, or any other kind of aninvestigation or examination, he should put his question to the right minister.

MR. BARRETT: Did the $5.5 million come through your department?

MR. SPEAKER: Order, please, hon. member. You must address the Chair and the ministerresponsible.

MR. BARRETT: I ask the Provincial Secretary: did the $5.5 million come through yourdepartment?

HON. MR. CHABOT: Well, I can't say whether each and every dollar of the $5.5 million camefrom my ministry, because advertising . .

MR. BARRETT: Thank you very much. That's fine.

HON. MR. CHABOT: . is budgeted for by all ministries of government. There's my answer.

TENURE FOR CONTRACT POSITIONS

MR. NICOLSON: Mr. Speaker, to the Minister of Universities, Science and Communications. Theminister's position on academic tenure is well known; I guess basically it's that good academics do not needtenure. Can the minister explain then to this House why the neurological project of which he is a member iscurrently offering tenure in order to entice applicants for two contract positions?

HON. MR. McGEER: Mr. Speaker, I'll be pleased to take the question as notice. I take it that thisis the standard advertising required for all academic posts, but I'll discover what the reason is and bring ananswer to the member.

MR. NICOLSON: While he's taking that as notice, would he explain why the July 29, 1983 issue ofScience magazine is inviting academics who are coming to British Columbia on this project tenure tracking?

HON. MR. McGEER: Mr. Speaker, I imagine this is standard advertising and probably would havebeen submitted many months ago. You can't get advertisements in magazines like Science on a daily basis.

TERMINATION OF

COMMUNITY INVOLVEMENT PROGRAM

MR. BARNES: A question to the Minister of Human Resources. Participants in the community



involvement program, recently cancelled by the minister, signed a six-month contract with the provincialgovernment. In view of the fact that the people signed these contracts in good faith, can the minister explainunder what authority she has unilaterally cancelled these employment contracts?

HON. MRS. McCARTHY: Mr. Speaker, the community involvement program has not beencancelled. The payment of $50 a month for the community involvement program has been withdrawn.

I will be pleased to take as notice the other part of the question vis-à-vis the six-month undertaking.

MR. BARNES: While you are taking that as notice, could you indicate to the House what will bethe status of those agreements currently due to expire on the 31 st of this month? I happen to know thatsome of them will last until the end of the year. Could you clarify what the situation will be in themeantime?

HON. MRS. McCARTHY: I'll take the question as notice.

CRAIG ASPINALL AND ASSOCIATES LTD.

MR. HANSON: Can the Provincial Secretary explain to the House why he has arranged throughDoug Heal's department to engage a Social Credit Party apparatchik by the name of Craig Aspinall toattempt to clean up the image of the government surrounding the budget and the bill?

HON. MR. CHABOT: That's a very interesting question. I'm not aware that the government hasdone any such thing. What was the individual's name?

MR. HANSON: Craig Aspinall.

HON. MR. CHABOT: Would you spell that for Hansard? I'll make sure that I examine the questionthat the member has put to me, because I'm sure he's very interested in it, especially the party affiliation. I'msure he'd rather have the party affiliation read NDP or something else, despite the fact that qualifications andskills might be equal.

The only thing I can say in response to the first member for Victoria is that I will take the questionas notice and bring back the answer as quickly as possible to see whether there is any substance to theallegation he's making at this time.

[ Page 703 ]

MR. HANSON: Mr. Aspinall is the proprietor of Craig Aspinall and Associates, which was themedia service for the Social Credit Party during the last election campaign. You may be aware of that. He'sbeen engaged by Mr. Heal for perhaps up to $150, 000 to clean up the image of the government. By theway, $150, 000 is one child-abuse team in this province.

Will the minister explain to the House why such a payment would be necessary to a media operationsuch as this to clean up this operation, and why the minister's personnel and staff, presently being paidmillions and millions of taxpayers' dollars, can't handle ministerial appointments and communications withministers without going to Mr. Aspinall's group, which will then take $150, 000 of taxpayers' money and dothis? Why does this have to be done?




HON. MR. CHABOT: Well, Mr. Speaker, I've never heard of the organization that the first memberfor Victoria makes reference to. First of all, the $150, 000 seems like a lot of money. I indicated a littleearlier that I would take the matter as notice, and I'll take the supplementary question as notice as well andbring the answer back at the very earliest opportunity.

Orders of the Day

HON. MR. GARDOM: I ask leave to proceed to public bills and orders.

Leave granted.

HON. MR. GARDOM: Second reading of Bill 25, Mr. Speaker.

HARBOUR BOARD REPEAL ACT

HON. MR. PHILLIPS: Mr. Speaker, I rise to open second reading of this bill which is really aculmination of one of the very remarkable success stories in the history of the province of British Columbia.The British Columbia Harbours Board was established by provincial statute in 1967. The purpose was topromote harbour development and ensure adequate access to British Columbia harbours. The top priority atthat time, of course, was the development of that great superport now known as Roberts Bank, includingadequate rail and road access.

MR. LAUK: Who wrote your speech?

HON. MR. PHILLIPS: Certainly not the same guy who writes your questions.

A provincial agent was necessary in this instance, Mr. Speaker, because the federal government andthe National Harbours Board were either unwilling or unable to act fast enough to ensure necessary portfacilities to export coal from that great coal-exporting area of our province, southeastern British Columbia.

The Harbours Board acquired, of course, the right of way to Roberts Bank and constructed a 40-kilometre railway access. The board owns this railway, and charges user fees to cover capital operating andmaintenance costs. Principle users of this little railway are the Canadian Pacific Railway and the CanadianNational Railway. The Harbours Board is a party to the Roberts Bank Expansion Agreement, madenecessary, of course, by additional sales of coal into the export market, Commitments to expand thecauseway and related railway facilities are now being completed and, naturally, are on schedule.

The board has also provided funds for studies for such smaller harbours as Campbell River, Stewartand, indeed, Kitimat. A number of factors led to the decision that responsibilities of the British ColumbiaHarbours Board should now be reallocated. Expansion of Roberts Bank and construction at Ridley Island isnow well underway, thanks to the great agreement to develop the northeast coal fields of this province.These two facilities assure adequate capacity for coal, grain and other bulk materials, and I must say thatbecause of those great decisions that were made, this province will be more than adequately served with portfacilities well into the decades ahead. I'm certainly happy to be part of a government with such great visionand courage as to carry on, at this particular point in history, these great developments.

[2:30]

The British Columbia Railway, of course, already manages the Harbours Board railway facilities,



and of course they also, Mr. Speaker - as you well know, because most of it's in your constituency - carryout all maintenance work. The British Columbia Development Corporation is the provincial agentresponsible for the development of provincial lands and is ideally suited to managing the Harbours Boardproperties. The federal government is finally - and I repeat "finally" - seeing the errors of its ways and isforsaking the monolithic, centralized concept of the National Harbours Board in favour of local autonomy.The British

MR. LAUK: I gave you that speech ten years ago.

HON. MR. PHILLIPS: Yes, well, it didn't do you much good, did it?

I must say that we have had some changes in the federal government, and they are now giving upthat local autonomy and are giving some responsibility in saying that westerners should have some say inthe running of the ports on the west coast. I've had, Mr. Speaker, now that you mention it, many argumentswith Mr. Pepin, the Minister of Transport, in saying there should be more local autonomy. He said: "Well, ifwe give you too much local autonomy you might preclude the movement of goods and services from otherprovinces in Canada." I had to say: "Well, my gosh, what about Rotterdam?" The largest port in the world.Who runs it? The city of Rotterdam. Moving through that great port are goods and services from all thecountries in Europe and even a lot behind the Iron Curtain. So I said to Mr. Pepin: "If you make iteconomically viable, and the decisions don't have to be made 5, 000 miles away on dry land in Ottawa -where they don't know a port from a whatever - and leave the autonomy, then maybe we'd get things done."It's happening, but not as swiftly as I would like to see it happen.

MR. LAUK: You're just not too swift.

HON. MR. PHILLIPS: I know that; I read that. I'm not too used to putting legislation through, soyou'll have to bear with me.

The British Columbia Harbours Board has done what it set out to do, and its duties can now becarried out more

[ Page 704 ]

efficiently by two other existing Crown corporations, the great British Columbia Railway and theBritish Columbia Development Corporation.

MR. LEA: Which you voted against.

HON. MR. PHILLIPS: We won't talk about that.

By order of this act, the assets and liabilities of the Harbours Board will be divided between theBritish Columbia Railway and the Development Corporation. As of March 31, the Harbours Board hadbook value assets totalling about $30 million. The Harbours Board owes $6 million on a note held by theprovince. Assets and liabilities will likely be transferred to receiving agencies at book value, when thelawyers get through sorting it all out.

The Harbours Board has done what it set out to do when the odds, at times, seemed squarely againstus. With Vancouver and Prince Rupert, Canada now has world-class access to the Pacific Rim, that greatgrowing area in the world. This little province and government led the rest of Canada kicking and screaming




into the Pacific Rim. They thought there was no other place on earth except the European community, butthis little government single-handedly now has Ottawa recognizing where the future is. By reallocating thisCrown corporation's responsibilities, we are demonstrating that current government policies are a logicalcontinuation of philosophies which have been in place since we were returned to government in 1975.

1 now move that the bill be read a second time.

MR. NICOLSON: On a point of order, we know that the minister has now moved that the bill beread a second time, but when shall it be read?

MR. SPEAKER: If the minister adds one more "now, " we'll be . .

HON. MR. PHILLIPS: Mr. Speaker, I stand corrected, and I now move that the bill now be read asecond time now.

MR. SPEAKER: That pretty well covers it.

MR. LEA: It would be a simple matter to go along with this bill if the minister had put all the cardson the table, but he hasn't. The minister has failed to mention that we are talking about 4, 000 acres ofagricultural land that's going to be transferred into the B CR or the B.C. Development Corporation. Thereare people in the community who are worried that either this agricultural land will be developed by the BCRor the B.C. Development Corporation, or sold off to friends like Dawn Development or others to bedeveloped. There are probably members in this House who know that I'm not the only one with thatconcern. The municipality of Delta, Mr. Speaker - of which you have some knowledge, I'm told -is alsoopposed to this bill's going through. As a matter of fact, the Delta municipal council made a representationto the minister asking the minister not to pass this legislation because of their concern of losing agriculturalland.

HON. MR. PHILLIPS: That isn't what they said, Graham. Read the letter.

MR. LEA: Why didn't you mention to the Legislature, Mr. Minister, that there is opposition from alocally elected council?

HON. MR. PHILLIPS: That's your job. Do you want me to do everything for you?

MR. LEA: That's my job. That's right. We have to do your job, our job, everybody's job, becauseyou can't do the job.

Why wouldn't the minister, in his opening remarks asking this Legislature to pass this particular act,tell us what they planned to do with the assets - not just that they're going to transfer them to the greatBritish Columbia Railway or to the wonderful British Columbia Development Corporation, but why arethey transferring them? There must be a reason. The minister hasn't given us a reason, so we can onlyassume that it's one of those Social Credit dirty tricks. That's all we can assume.

First of all, the Delta council asked that this land be transferred to one of two other places: either tothe Minister of Agriculture and Food, because they have a little bit more faith that the Minister ofAgriculture and Food isn't going to let good agricultural land out to be developed . . . . I don't know whetherthey knew at the time that the Agricultural Land Commission, which is the other agency they wouldn't mind



it being transferred to, wouldn't even exist in reality -so why transfer it there? But I think we do have to putour faith somewhere. As a member of this House, I would feel much better about it if these 4, 000 farmacres were transferred to the Minister of Agriculture and Food for stewardship than transferring it to BCRand that minister.

You can bet that if this bill passes there'll be members of this House on the Social Credit side whowon't be able to vote because of conflict of interest. That's what's going to happen. Will the member forMaillardville-Coquitlam (Mr. Parks) be able to vote on this? Is he going to be allowed to vote on thislegislation that will probably be just a stopgap between the Legislature and Dawn Development? That's allit's going to be. If only the member for Delta (Hon. Mr. Davidson) were allowed to speak in this debate. I'dbe really interested in hearing that member's plea, with mine, on behalf of the community that he represents.Could you get a surrogate delegate here, Mr. Speaker? Could someone else speak for the member for Delta?Because, believe me, the Minister of Agriculture (Hon. Mr. Schroeder) is not one of those pinkos orcommie conspirators that some members of the House are so worried about.

MR. LAUK: Now wait a minute.

MR. LEA: Well, yes, let's not get ahead of ourselves; he's never really said that. He's never deniedit.

We can't vote for this bill. We would be letting down all of the people of British Columbia if wewere to allow 4, 000 acres of good farmland to transfer to the Minister of Industry and Small BusinessDevelopment. We would not be doing our duty. The first thing we'd probably see would be commercialproperty or anything at all on that farmland except what farmland can produce.

This government seems to be under the misapprehension that we can get rid of all of our farmland -no problem. We can import those things we need to consume in terms of farm products from California,Mexico or anywhere else. We're

[ Page 705 ]

okay. Get rid of our farmland and we'll just import it. There's a higher use, the government feels, forfarmland than using it for farmland. It just sort of turns them sick to their stomachs when they drive byfarmland and they don't see a house or a factory on it. They think to themselves: "My God, if we could justget this farmland and have commercial and industrial property on it, and still import all those foodstuffs."

MR. REID: Who put the industry on 726 acres of Tilbury Island?

MR. LEA: What is that harping, carping thing back there? He still has to make his maiden speech inthe House on his feet; he's made about 55 of them sitting down.

MR. REID: Tell us about the 726 acres, because this is the same to me.

MR. LEA: Why don't you tell us?

MR. REID: I'll tell you.

MR. LEA: Oh, I bet you won't even speak on this legislation, Mr. Member. You've probably beentold to vote and shut up. That's what the back-benchers do. They feel that's what they're paid to do. You



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know, when someone said that Social Credit politicians are the best politicians that money can buy, theymeant it. And with every piece of legislation that goes through here we're finding out that it's more true allthe time.

Farmland means nothing to this government.

MR. REID: What about Tilbury Island? That was 726 acres of the best farmland . . . .

MR. SPEAKER: Order, please, hon. members. All members will have an opportunity to take part inthe debate.

MR. LEA: Mr. Speaker, when we alienated farmland for Tilbury we were right up front. We saidthat that legislation was there to protect farn-dand.

SOME HON. MEMBERS: What about Kamloops?

AN HON. MEMBER: What about Salmon Arm?

MR. LEA: My God, Mr. Speaker, they're going crazy on us today, aren't they? Do you have anyrule at all up there that would apply to Social Crediters?

MR. SPEAKER: Hon. member, we do, however, have rules that guide us in debate on secondreading, and I think we could narrow the debate somewhat.

MR. LEA: Sure, I can understand why I would be brought to task.

MR. LAUK: You've been interrupting yourself.

MR. LEA: Yes, I've been interrupting myself all along here, did you notice that? Thank you, Mr.Speaker. Thanks a lot; I appreciate it.

Mr. Speaker, you look an awful lot like the member for Delta, and it was the municipality of Deltathat asked that this legislation not go through in its present form, because the community is worried aboutwhat will happen to the 4, 000 acres of farmland involved here.

We are also concerned about these 4, 000 acres of farmland, and I think it's only incumbent upon meto point out what I see as the philosophy of the Social Credit when it comes to farmland. I don't think thatthe Social Credit are stupid enough to believe that we can exist without farm products. But they believe thatwe can get the farm products from somewhere else.

[2:45]

AN HON. MEMBER: Chile.

MR. LEA: Anywhere - so that we don't have to preserve farmland in the province - seems to be theway they want to go. Mr. Speaker, that's just not good enough. California, where we get a lot of our producenow, tells us that they won't be able to supply farm products, even to the extent they've been supplying themin the past. They have water shortages, too many crops ruining the soil, burning out the soil. They've gottheir problems. And California tells us: "Canada, British Columbia, don't expect that we can continue the



supply." Even some of the farmland today which under existing conditions is not economical will becomeeconomical as farm produce becomes scarcer and scarcer from importing sources.

AN HON. MEMBER: When's that?

MR. LEA: I don't care when it is. I don't care whether it's next week or next year or ten years fromnow, because this side of the House is not only concerned with what we're going to eat; we're concernedwith what our children and our children's children are going to eat. That's what we're concerned about.

Mr. Speaker, this government look at us and they call us "airy-fairy, " They don't really think thatwe're crazy; they just think we're just a little fuzzy and woolly-headed.

AN HON. MEMBER: You said that, we didn't.

MR. LEA: No, you say it all the time. They believe that on this side of the House we're a little "airy-fairy" because we're worried about what might be happening to future generations. Their attitude is: whyworry about it? I would like to go back to something I've said in this House before but that I think bearsrepeating. There are only two kinds of people in the world today. One group looks at the future and sees itas pretty bleak. The other group looks at the future and sees it as pretty bleak. It's what you do after that thatcounts. The Social Credit are people who say: "Look, if you've booked passage on the Titanic, why gosteerage? Let's live it up. Let's not even put somebody up there to look for the icebergs." Maybe down theroad with science and agricultural technological breakthroughs we won't have to worry about it. Now thescientists in agriculture tell us we do have to worry. They tell us that especially in this province we reallyhave to worry about agricultural land, not only in the future, but in the present. We have a shortage ofagricultural land in this province. If we are to use our heads, we have to worry about it.

On this side of the House we don't see the future as all that rosy either. We see some of the thingswe're looking at as

[ Page 706 ]

pretty bleak - nuclear armament and all of the environmental things, and everything else. We don'thave blinders on either. But we aren't going to climb on the Titanic and go first class. We're going to try andturn it backwards a little. We're going to fight every inch of the way. We're going to try to maintainfarmland. We're going to try to maintain good environmental standards because we know our future and ourchildren's future depend on the vigilance of those of us who are here today. It's so short-sighted to view theworld in such a bleak form that you're afraid of courage; that this government is afraid to do the kinds ofthings that are needed in order to preserve British Columbia for future generations. Their attitude is: do whatyou want. Get rid of farmland. It doesn't matter. There are going to be scientific and agriculturaltechnological breaks in the future that will make it all superfluous. Maybe they'll invent a pill: you can takeit in the morning and you don't have to eat the rest of the day. Maybe California will get water all of asudden and everything will continue the way it has in the past.

AN HON. MEMBER: Or hydroponics.

MR. LEA: Hydroponics is something that this side of the House talks about, Mr. Speaker.Hydroponics is, I think, something that we have to look at, especially for the north.

AN HON. MEMBER: You're pretty good at growing mushrooms.




MR. LEA: Mr. Speaker, after listening to the minister introduce this bill, we grow 'em, he eats 'em.That introduction to this bill was nonsense. Gibberish and nonsense!

MR. LAUK: That's because of the kind of mushrooms he's been eating - psilocybin.

MR. LEA: I never thought of that.

Mr. Speaker, the member for Shuswap (Mr. Michael), although he probably won't take his place inthe debate, is absolutely correct that we do have to look at such things as hydroponics to survive. But peoplewho are more knowledgeable than 1, and I don't know about the member for Shuswap, are telling us thateven with those kinds of modem technological breaks that we can look forward to, it won't be enough; wedo have to protect our farmland. For this side of the House to allow 4, 000 acres of farmland to disappearinto the British Columbia Development Corporation, or to disappear into the British Columbia Railway . . . .What experience have either of these two institutions had in managing farmland? It seems a bit ludicrous.Other assets that are being transferred - we have no real quarrel with the . . . .

HON. A. FRASER: The BCR kills cows.

MR. LEA: That's absolutely right. I think that is the attitude. The Minister of Highways says to myremarks: "The BCR kills cows, What do you mean they don't have any experience?" Now I know he said itin jest, but it's true. That is their only experience. What will the British Columbia Railway or the BritishColumbia Development Corporation do with 4, 000 acres of rich farmland on the delta? Will they just holdit and not do anything with it? If that's the case, why do they need it?

If this government's record weren't so bad in dealing with farmland and if this government's recordweren't so bad in telling the truth, it wouldn't be so bad. But their record is abysmal in both areas: dealingwith farmland and telling the truth as to their intentions. We cannot take their word for it. I don't see howthe government can expect us to take their word for it. All you have to do is take a look at the May 5election to see how a government breaks its word.

HON. A. FRASER: You should look.

MR. LEA: We are looking at it and so are the people of this province, Mr. Minister. There are agreat many people out there who voted for something other than what they got. The people out there andthose of us who represent those people in here know we cannot rely on the Social Credit Party to tell thetruth. They know we can't rely on the Social Credit Party to deal with farmland sensitively and withcommon sense.

When we see agricultural land being transferred into a development company, be it the governmentdevelopment company or any other development company, I think it's reason for concern. For the ministernot to even mention these 4, 000 acres of farmland in his opening debate on this legislation would almostlead you to believe that he hoped we didn't know about it, that somehow they could slip it over on us -just ahousekeeping bill that transfers a few assets out of the Harbours Board into the British Columbia Railwayand the British Columbia Development Corporation. We will not vote for this bill in its present form.

This Bill 25 is part of the package called Budget '83. How much is going to be saved by transferringthese assets to the BCDC and to BCR? I doubt if anything will be saved. The people who now manage these



assets may not be the same people managing the assets, but the time involved and the administrative setupneeded to manage these assets is going to be exactly the same, so no money is going to be saved. That I cansee. When the minister closes debate, maybe he could elaborate on any money that's going to be saved. ButI can't see it.

Even if a few bucks are saved on this, exclude the farmland from the transfer of assets. If you wantto bring back a piece of legislation transferring all other assets into the BCDC or the BCR, we'll go alongwith that; but we're sure not going to go along with transferring farmland.

[Mr. Strachan in the chair.]

In the past we have seen the written word and heard the spoken word from members of the SocialCredit Party on their attitude toward handling farmland. In all honesty, Mr. Speaker, could you vote for thislegislation? If you represented Delta, could you vote for this legislation? I doubt it. The legislation is goingagainst local wishes. On the one hand, the government is telling us how much they admire local autonomy,how much they admire the wisdom of local decisions because local decisions are made by people who areimmediate to the problem, who can understand the problem and who have to live with the results of thedecision. In fact, that's what they argue when they talk about the Spetifore land, That's what they argueabout when we're discussing another piece of legislation which, in my opinion, takes powers away from theregional level. Their philosophy

[ Page 707 ]

changes from bill to bill. In one bill they want to give local autonomy; in another bill they want totake it away.

I would feel a lot better if this farmland were transferred under the agencies of the regional district,as opposed to this government. Even at that, I would rather see this farmland transferred to the Minister ofAgriculture (Hon. Mr. Schroeder) under this government than to the Minister of Industry and SmallBusiness Development. It just doesn't make sense that you'd transfer farmland to the Minister of Industryand Small Business Development, unless the government intended to put development on that farmland.Why would the Minister of Industry and Small Business Development want farmland? Is he going intofarming? That doesn't seem to be the function of either the BCR or the British Columbia DevelopmentCorporation. So I think we can safely assume that it's not going into farmland.

In each piece of legislation there's a short explanatory note. On this one it says: "Harbour BoardRepeal Act, Explanatory Note. The purpose of this bill is to dissolve the British Columbia Harbours Boardand to provide for the transfer of its assets to the British Columbia Development Corporation and the BritishColumbia Railway Company." Period. The government is saying, in a succinct sense, that this is theirintention - to transfer these assets over to another area.

I can't believe this government isn't a bit more machiavellian than that. I can't believe they'vesomehow forgotten that we're dealing with 4, 000 acres of farmland. I think this government knows full wellthat part of the assets to be transferred are these 4, 000 acres of farmland, and I think they have plans forthem. I don't think the plan is to farm, or any other agricultural purpose. I think the plan is for some kind ofeconomic development; what, we don't know. But I think it would be safe to assume that when you transferland to the minister of economic development, it will probably be used for economic development and notfor farmland. It seems to make sense.




On top of that, we have to continue looking at the record of this government as it relates to farmland.We have to look out towards Langley, at the acres and acres of farmland in Langley and this government'sefforts to get that farmland out of agricultural purposes and into development. We have to look at theSpetifore property in Delta and this government's efforts to take farmland and put it into economicdevelopment, commercial development. That is their record. It's almost cheeky for the government to comein here and try and hide, within the context of this bill, 4, 000 acres of farmland. Not one mention of whatthe assets are. Wouldn't it have made better sense for the government to bring in a piece of legislation andsay: "We're going to transfer the assets and here's the list. Here's what the assets are." Wouldn't all membersof this House, including government backbenchers, feel a little better about that kind of legislation? Are wesupposed to be debating blind, or is the government's real intention the hope to slip through an innocuouslittle bill?

Interjection.

MR. LEA: Oh now, nothing from you, Mr. Member. Your federal leader has just condemned you,hasn't he?

MR. REYNOLDS: He loves it.

[3:00]

MR. LEA: Oh, he hates it.

Mr. Speaker, the Conservative member behind me, who is on record as wanting the Spetiforeproperty out, has interjected. Are we going to trust 4, 000 more acres to those backbenchers, Mr. Speaker?Are we going to trust 4, 000 acres of farmland to the Social Credit in economic development? The answer isno. I don't think the people of this province would want the opposition to vote yes on this bill. I don't thinkthe people of this province would want the Social Credit to vote yes on this bill. One thing we know for sureis that the municipality of Delta doesn't want us to vote yes on this bill.

MR. REYNOLDS: The people do.

MR. LEA: No, they don't. They want this property transferred to either the agricultural landcommission or the Ministry of Agriculture. If the truth were known, the Minister of Agriculture (Hon. Mr.Schroeder) would like that too.

Interjections.

MR. LEA: Isn't it amazing that those who are in opposition to the Social Credit are a bunch ofcommie, pinko crazies.

SOME HON. MEMBERS: True, true.

MR. LEA: And you know, Mr. Speaker, they believe that. It's called "groupthink." That's a theoryput forward by a psychologist named Janis, who wrote a book called Groupthink. If certain ingredients arein place, then a group can be affected by what Janis calls groupthink. He used four examples in history ofwhere, in his opinion, groupthink took place; one of them was the Bay of Pigs, the other was Pearl Harbour.

One of the most important ingredients in groupthink which is a very dangerous thing, because



groupthink means the group thinks it's absolutely right and everybody else is absolutely wrong - is euphoria.Ever since May 5 we have seen a euphoric groupthink like we have never seen before in this province. Theybelieve they are absolutely correct and that everybody else is absolutely incorrect. They believe that themore people come out and campaign against them and call them down, the righter they are. They feel betterand more righteous. Every time there are more people out on the steps and out there in the citizenry of thisprovince complaining, it only serves to make this government and this euphoric group believe that they areabsolutely more right than they ever were before. We have a dangerous phenomenon going on in thisprovince - a group of people who are euphoric.

HON. MR. PHILLIPS: Speak to the bill, will you?

MR. LEA: I'm speaking to the bill; you didn't. If you had spoken to the bill, Mr. Minister, youwould have been upfront and told us that the assets being transferred included 4, 000 acres of farmland. Youwould have told us what you intended to do with that land and why it was being transferred to the BritishColumbia Development Corporation or the British Columbia Railway. The minister did not lie, but heomitted the facts. Why wouldn't the minister tell us the assets that are being transferred?

[ Page 708 ]

Interjection.

MR. LEA: You'll have your opportunity. In fact, he had his opportunity to tell us, and he did one oftwo things. He didn't know what the assets were. It would be unforgivable, wouldn't it, that a minister wouldbring a bill in here and really not know what it's all about. If he did know that 4, 000 acres of farmland wereto be included and didn't tell us anyway, it would be unpardonable. Either way, he is condemned by hisaction or lack of action.

That minister has not acted responsibly. If he had been responsible, he would have been moreupfront. In his opening remarks on this legislation he would have come in here and said: "Here it is. We'regoing to transfer all these assets. Here's what they are, and here's why we're transferring them and here'swhat we're going to use them for." He didn't do it, and you have to ask why. Did it slip his mind that 4, 000acres of farmland was to be included? I'll bet you that there are back-benchers over there who don't evenknow the contents of this bill. They don't know what the assets are.

MR. REYNOLDS: Do you know what they are?

MR. LEA: No, I don't know what they are. Do you know what they are?

MR. REYNOLDS: Yes, and I'll get up and tell you what they are if you'll sit down.

MR. LEA: You'll have your turn. That member will also have his turn to tell us why they'retransferring 4, 000 acres of farmland into there.

MR. REYNOLDS: It will be a pleasure.

MR. LEA: I can't wait to hear it, because every time he explains his position we pick up more votes,and Brian Mulroney loses a few more votes.

I wonder if this is one of the bills that Brian Mulroney, the leader of the Conservative Party, said that




he didn't agree with last night. The Conservative leader said he didn't agree with the restraint program that'sbeing used, and this is part of the restraint program, I understand. As I understand it, the reason that this billis in front of us is because the minister has said that there's going to be a few dollars saved. Right? That'sthe purpose. It's going to be more streamlined administratively and there's going to be some dollars saved.He said that when he summed up at the end of this debate - two or three years from now - he was going totell us, but he didn't tell us. I suspect that he can't tell us. Mr. Mulroney apparently doesn't agree with thiskind of restraint program. He doesn't agree with the Social Credit Party and says he's trying to distancehimself. In fact, the only group that I know in the entire country who agrees with the legislation is theCanadian independent small business group, Mr. Bulloch, and he didn't even agree with it until he went intothe Premier's office and came out again.

MR. REYNOLDS: The Vancouver Board of Trade agreed with it.

MR. LEA: The Vancouver Board of Trade agreed with it and the Canadian Federation ofIndependent Business people agreed with it. I don't believe that, by the way. I believe that maybe Mr.Bulloch and Mr. Pepper were speaking on behalf of their executive or themselves, but I doubt very much ifthey canvassed the members of the small business community in Victoria to see whether they agree withthis restraint program.

Do you know that the civil servants are going into the bank and the lending institutions to get a loanfor a mortgage and are being told no because they don't have enough security to get a loan? How does thataffect the realtors? Do the realtors agree with this kind of restraint measure?

AN HON. MEMBER: To the bill.

MR. LEA: To the bill. They don't like it. They're the ones who said it was a package. They're theones who brought 26 bills in, this one being Bill 25. They're the ones who brought it in and said: "It'sbudget '83, and this is a package." But that was too tricky by half, because what they did was bring in abudget and then bring in 26 bills that have very little, if anything, to do with the budget. What they hoped todo was cover up a lousy, stinking budget that will not bring around economic recovery, but will drive usfurther into a recession, and they hope to cover that up by bringing in this kind of legislation. The SocialCredit would much rather argue about farmland and human rights, and would much rather debate aboutlandlords, tenants and rent controls than they would a lousy budget. So they thought: "Aha, we'll bring inthis budget, but to take the sting away, so people won't know exactly what we're up to, we're going to bringin 26 bills. We're going to take away human rights, transfer farmland into the BCR, give the landlordseverything, take away consumer protection; and boy, everybody's going to be so upset and they're going tobe fighting all this stuff and they're not even going to notice a budget going through that does nothing for noone." That's what they're doing, and you know dam well, Mr. Minister, that was the plan. But now they'refinding out, Mr. Speaker, that on Bill 25 and on other bills people are not too happy.

HON. MR. PHILLIPS: On a point of order, Mr. Speaker. The member who is speaking has been inthis Legislature a long time; as a matter of fact, too long.

DEPUTY SPEAKER: State your point of order, please.

HON. MR. PHILLIPS: I would suggest that you bring him to order and get him to speak to theprinciple of the bill. He's wandering all over the map. If he hasn't got anything to say about the bill, heshould take his seat and let somebody who knows something about the bill speak to it.



DEPUTY SPEAKER: The point of order is well taken. I will commend to all members of theHouse that in second reading we speak to the principle of the bill. I'm sure the hon. member for PrinceRupert can do that.

MR. LEA: Mr. Speaker, I'm convinced that there is no principle to this bill, only a lack of principle,and the lack of principle is transferring farmland into development. I think what we have to do in that case isgo through the litany of bad decisions surrounding this government and farmland to prove, once and for all,that this government in its entirety cannot be responsible for farmland, but most specifically the

[ Page 709 ]

Minister of Industry and Small Business Development cannot be given another 4, 000 acres offarmland out of the delta of the Fraser River to be squandered and spent on economic and commercialdevelopment, as opposed to farm and agricultural purposes.

I find it hard to believe that there are members in this House who represent big farmingcommunities. I don't. I was raised on a farm and I know something about it, but there is very little fanningin my constituency. For members of this House who represent constituencies with large farm holdings not tobe upset about 4, 000 acres of farmland being transferred to the Minister of Industry and Small BusinessDevelopment is beyond my understanding. Is the member for Okanagan North (Mr. Campbell) not going totake his place in this debate and talk about 4, 000 acres of farmland being transferred for economicdevelopment? Or is he going to be silent, and when the time comes and the Premier snaps his fingers, standand vote for Social Credit, no matter what?

Are the two members for Surrey (Mrs. Johnston and Mr. Reid) who have a great deal of very richfarmland in their constituency going to let their neighbouring community of Delta suffer the loss of 4, 000acres of farmland? The answer is yes. They're on record. There's doubt for the member for Okanagan North,because he doesn't speak much and he's a new member and we don't know where he stands. But we doknow where the two members for Surrey stand: they will be voting for agricultural land to go into economicdevelopment. We know that for sure.

Interjection.

MR. LEA: I do want to hear him, but there is a procedure here and the procedure is that he can getup right after I finish.

[3:15]

But, Mr. Speaker, I'd be willing to bet you .... Let's not make it too big a bet. What shall we make it?What about a medium vegetable pizza? Which we probably won't be able to pay off if we lose thisfarmland. I'd be willing to bet that the member for Okanagan North does not speak on this bill - that he'sgoing to silently sit there and hope that Hansard doesn't reach his constituency. I'll bet you that there areother members of the. back bench in the Social Credit who are not going to speak on this bill and will sitthere silently and hope that the Hansard record doesn't reach their constituents.

I have to warn you, Mr. Speaker, and I have to want them, that one of our members may squeal. Oneof our members may actually go to the north Okanagan and tell your constituents, Mr. Member, that yousilently sat there and didn't say anything, and when the time came you voted with the government.




HON. MR. WATERLAND: On a point of order, the member from Prince Rupert is telling aboutwhat members of the Social Credit caucus are not going to speak on this bill, and I wonder if he's going tocontinue not speaking on this bill himself. I understand that second reading is rather narrow.

DEPUTY SPEAKER: The point of order is well taken. Briefly, the member should speak to the billand avoid personal reference to other members.

MR. LEA: Yes, would you chastize him for getting up on a non-point of order?

DEPUTY SPEAKER: That was a point of order.

MR. LEA: It was, Mr. Speaker?

I move adjournment of this debate until the next sitting of the House.

[Mr. Speaker in the chair.]

Motion negatived on the following division:

YEAS - 15

Macdonald Barrett CockeDailly Lea LaukNicolson Brown HansonLockstead Barnes WallaceMitchell Passarell Blencoe

NAYS - 28

Chabot McCarthy GardomSmith Curtis PhillipsMcGeer A. Fraser DavisWaterland Brummet SchroederMcClelland Heinrich HewittRichmond Michael PeltonJohnston R. Fraser CampbellStrachan Veitch SegartyRee Parks ReidReynolds

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

MR. SPEAKER: As I have mentioned before, if it is the wish of the House on recording votes, wemay do so automatically, if there is unanimous leave.



Leave not granted.

MR. REYNOLDS: I hadn't planned to get up and speak in this debate, but the member for PrinceRupert (Mr. Lea) got my adrenalin going and the second member for Vancouver Centre (Mr. Lauk) said:"More votes for us when he speaks, " That was another comment I think the member for Prince Rupertmade, and that also got me going. It's nice to get up and remind these NDPers that on May 5 the people ofthis province voted this government in overwhelmingly. They voted in Social Credit. This member herewent into a constituency and increased the votes over the member that was there previous to him, and also ifthey - and the member for Prince Rupert - want to go back to 1972 and 1974, they'll find that this memberdefeated the NDP candidates in his constituency quite handily. In fact in 1974 I had the largest majority inthe federal House in all of British Columbia. That's because I don't mind speaking my mind, speaking aboutfree enterprise and telling the truth, and I do mind if I have to listen to distortions of what is reallyhappening in this Legislature.


I want to quote the member for Prince Rupert. In one of his comments he said "Groupthink thinkseverything they

[ Page 710 ]

think is right and everybody else is incorrect." Well, a groupthink in my mind is Solidarity -something that this member and members of his party support wholeheartedly, I understand. The Solidaritygroup think they're right and everybody else is wrong, but I've read the brochure that they put out, and I'venever seen . . . .

Interjection.

MR. REYNOLDS: I'm speaking on the bill, and it has to do with Bill 25 because the Solidaritygroup printed a brochure full of absolute lies, things that they know are incorrect. I would say that outsideas well as inside this chamber the people who put that brochure together had to know they were lying.They're trying to fool the people of British Columbia, and that's why I'm going to speak in this Legislatureon Bill 25 and make sure that the people in this province hear both sides of the argument and know whatthis government is trying to do.

Bill 25, the Harbour Board Repeal Act was put forth by Hon. Donald McGray Phillips - I'd neverheard his middle name before; I thought I'd say that it's awfully nice - the Minister of Industry and SmallBusiness Development. The explanation for this bill explains that "the purpose of this bill is to dissolve theBritish Columbia Harbours board and to provide for the transfer of its assets to the British ColumbiaDevelopment Corporation and the British Columbia Railway Company." The member for Prince Ruperttalked about the fact that 4, 000 acres of farmland were being transferred to the minister. That's incorrectalso, because if he read the bill he would see it's not being transferred to the minister; it's being transferredto the British Columbia Development Corporation and the British Columbia Railway Company. I thinkthat's something, Mr. Speaker. The facts of this matter have to be pointed out to show that this member forPrince Rupert is not putting all the facts before the people of this province.

AN HON. MEMBER: Or this House.




MR. REYNOLDS: Or this House, and I think that's extremely important.

The member, who's also the critic for that party, has had to leave the House. To be fair, maybe he'sgot a meeting outside, but you would think that this matter is so important that he could sit in this Houseand listen to a member from the government side explain some of the facts of life. The member for PrinceRupert said: "Can you explain what the assets are?" I'm quite surprised that he would get up and take thetime of this House to tell us that he knows there are 4, 000 acres of farmland in the assets, but he didn'tseem to know what the other assets were. So how did he find out about the 4, 000 acres if he didn't look atsomething to get his information? If he had looked he would have found out that the 4, 000 acres are beingtransferred. Certainly there are 4, 000 acres, but there is also a railway and a port. Those are basically theassets that are in the Harbours Board right now.

I have to say that I'm not as concerned as the member for Prince Rupert is about these 4, 000 acres ofland. He talks about the council in Delta; "the people in Delta" - is the way he put it, I think - are opposedto this matter, I suggested to him that certainly some members of that council may be opposed to it, but thepeople of Delta are not afraid of anything this government wants to do with that 4, 000 acres of land. Hemay find that hard to believe. He mentioned that it was unfortunate that the member for Delta (Hon. Mr.Davidson) couldn't debate on this thing - and it is. I know he'd love to be speaking for his constituents, butsince I represented that constituency as the federal Member of Parliament for so long, I feel it's only fair thatI get up and tell this House that the people of Delta not only like the job this government is doing in BritishColumbia but by returning that member with a larger majority in the last election than he ever had before,they also defeated the NDP by more votes in the last election than ever before in a provincial election.

I'm going to quote the member for Prince Rupert: "What will they do with the 4, 000 acres offarmland?" He said that we'll let 4, 000 acres of farmland disappear into B.C. Rail or BCDC. If he wants togo back and understand why they put it in there originally, it was expropriated to protect the land around asuperport being built in this province - a coal port right now that is one of the finest coal ports in the world.It has provided hundreds of jobs across British Columbia, not only in the lower mainland but also in theKootenays and other areas where that coal is coming from. It was a brave and a smart decision of thegovernment of that day to preserve those 4, 000 acres of land around this port, because in the future thecitizens of British Columbia are going to say: my god, who were the brilliant group of people who took overthat land so many years ago to make it available for a superport in this province? We're certainly going tohave a superport in that area.

Interjection.

[3:30]

MR. REYNOLDS: I had a note about it here somewhere: it's Ridley Island where this governmentis spending so much money in employing approximately . . . . It happens to be in the constituency of themember for Prince Rupert. I notice he didn't talk about that today and tell us how proud he was that thisgovernment doesn't show bias in this province. We created 1, 200 jobs in the constituency of the member forPrince Rupert. And here's an NDP group that talks about this party and its inability to get jobs, and here wecreate 1, 200 jobs right in that member's riding.

MR. REID: Those are real jobs.

MR. REYNOLDS: And a lot of them are union jobs, done by your good Social Credit government.



That's why I say Bill 25 is so important to this House.

MS. BROWN: That's a federal job.

MR. REYNOLDS: Oh, listen to the NDP. Mr. Speaker, I don't want to listen to the member forBurnaby-Edmonds, because she's the one who also talked about her West Indian cricket team, and we knowhow incorrect she was on that matter.

Interjection.

DEPUTY SPEAKER: Order! I'll ask the hon. member for Burnaby-Edmonds to withdraw thatremark.

MS. BROWN: I withdraw that remark, Mr. Speaker, because he's worse than the remark I made.

[ Page 711 ]

DEPUTY SPEAKER: Order, please. I'm sorry, it has to be an unqualified withdrawal. The memberwill withdraw without qualification.

MS. BROWN: I withdraw that remark, because he doesn't know what he's talking about.

DEPUTY SPEAKER: Order! Thank you, that's sufficient.

MR. REYNOLDS: Mr. Speaker, I don't mind what the member for Burnaby-Edmonds calls me,because she never knows what she's talking about anyway.

Interjections.

MR. REYNOLDS: Mr. Speaker, I intend in a future debate to get up and talk about her commentsabout the West Indian cricket team and how misleading they were, and how that member can create racismin this province by false and misleading remarks.

MR. LEA: Shame!

DEPUTY SPEAKER: We're now getting into personal references throughout the House. I'll ask themember to speak to Bill 25. I call for order, please.

MS. BROWN: Go ahead, tell us about racism.

MR. REYNOLDS: I don't have to tell you about racism; you create enough of it yourself in thisprovince.

Interjections.

DEPUTY SPEAKER: Order! I'll call the member to order one more time. Please proceed on Bill25.

MR. REYNOLDS: The gentleman over here says I'm Mulroney's spokesman. Well, Mr. Speaker, at




this time I'm just speaking on Bill 25, telling the people of this province what a great job this government isdoing in transferring this land. I want to explain something that the member for Prince Rupert doesn't seemto understand. He talked about 4, 000 acres of farmland, which is what this bill is about. That 4, 000 acresof farmland is leased out to farmers in that area. In fact, one of the finest turf farms in all of Canada is partof that 4, 000 acres. A gentleman by the name of Bill Friesen and his father, John, are the owners of that. Ifthis member for Prince Rupert who complains about this bill would sit down and talk to some of thosepeople . . . they lease that land off this government right now, off the Harbour Board; they'll lease it off ofBCDC. They're developers; they're promoters of British Columbia. They'll be happy someday to have togive up that land that they're making money off of now as farmers to help this government and this provincecreate a superport in this province. That's why it's so important, Mr. Speaker, that we take this land rightnow and put it into BCDC and B.C. Rail, the people who should have control of it, the people who are outpromoting this province to create more jobs in ths province. It wouldn't surprise me, knowing this ministerand how hard he works, that . . . . He must have something . . . .

MR. REID: He knows something.

MR. REYNOLDS: He knows something, Mr. Speaker, that these people are working on in thisprovince to create something in that superport. He must have something in the back of his mind. I knowhow hard he works, and I expect to see something very great in this.

But that turf farm I mentioned . . . . If the NDP want to go back and check, they opposed a turf farmgoing in there because they said turf farms take the soil out of the land. Only when they heard from theexperts did they find out that turf farms actually increase the soil and the value of it. But they slunk awayand didn't talk about it, because they don't know anything about farming. They like to talk about it, and talkabout farmland as if it's their God-given right to be the defenders of it. But it's this government that hasmade some good decisions on the farmland that they've used around that coal port, and they'll make gooddecisions in the future.

MS. BROWN: Giving it away to all your friends; that's a good decision.

MR. REYNOLDS: Well, the member for Burnaby-Edmonds says we're giving it away to all ourfriends. Again, she doesn't know what she's talking about, because this land is not being given away toanybody. It's creating jobs for the people of this province, jobs that will allow this government to continuewith the greatest social programs of any province in this country. It's supporting things like the B.C.Summer Games, so that people can play cricket; so that all people of all races and creeds can play cricketwith no racism involved.

Once again I would just like to congratulate the minister for getting up and doing a great job in thisHouse. I now move adjournment of this debate until the next sitting of the House.

Motion approved on the following division:

YEAS - 41

Chabot McCarthy GardomSmith Curtis PhillipsMcGeer A. Fraser Davis



Waterland Brummet McClellandSchroeder Heinrich HewittRichmond Michael PeltonJohnston R. Fraser CampbellStrachan Macdonald BarrettCocke Dailly LeaNicolson Brown HansonLockstead Wallace MitchellPassarell Blencoe ReynoldsRee Parks VeitchSegarty Ree

NAYS - I

Lauk

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

HON. MR. GARDOM: I call second reading of Bill 30, Ocean Falls Corporation Repeal Act.

[ Page 712 ]

OCEAN FALLS CORPORATION REPEAL ACT

HON. MR. PHILLIPS: Mr. Speaker, in 1973, when the socialists were the government in thisprovince, they ....

Interjection.

[3:45]

HON. MR. PHILLIPS: The socialists were the government. That's what I said. When you socialistsover there were government, the NDP government of the day bought a white elephant on behalf of thepeople of this province. The writing was on the wall. Crown Zellerbach, who then owned the Ocean FallsCorporation, realized that its Ocean Falls newsprint operation would shortly be uneconomical. So with thelogic of all true socialists, the NDP government blundered dramatically, and the taxpayers of this provincehave been paying through the nose for that mistake. On behalf of all of us, the socialist governmentpurchased the Ocean Falls mills operation from Crown Zellerbach, but they didn't have the intelligence atthe time to buy a guaranteed wood supply to go with it. Today it costs more than half a million dollars justto ensure that Ocean Falls will not deteriorate to the point where future operations may not be viable.

Interjection.

HON. MR. PHILLIPS: I'm saying it in here. Maybe if you'd pay attention and stay in here once ina while you'd learn something, instead of just sitting over there yacking.




The tabling of the two acts, the Ocean Falls Corporation Repeal Act and the British ColumbiaCellulose Company Repeal Act, is a significant success story for the Social Credit government. It is areversal of what might be considered a serious error by the previous NDP regime, when Bob Williamsmade the taxpayers responsible for various resource companies under the umbrella of B.C. Cellulose.Among the acquisitions were Crown Zellerbach's assets at Ocean Falls, purchased by the Crown for $789,952.

The Bella Coola Development Co. started sawmill operations in 1908. Pulp operations followed in1912. In 1915 Crown Willamette Paper Co, later called Crown Zellerbach, took over the mill. In 1917newsprint production began. Peak production was achieved in 1945. In 1964 Ocean Falls began to suffereconomic problems due to obsolete production facilities. Between 1965 and 1971 three of the six papermachines were shut down. In 1972 Crown Zellerbach announced that all operations would cease within ayear. In 1973 the NDP government purchased this troubled Ocean Falls operation on behalf of the people ofBritish Columbia. When the Social Credit government returned to power in 1975, it was with the firm beliefthat the government should not be involved in areas that had traditionally been served by the free marketand the private sector. Former Forests Minister Ray Williston was given the job of privatizing theacquisition of B.C. Cellulose Company. The result was BCRIC. It was ruled that the trouble-plagued OceanFalls operation would only be a millstone around the neck of the newly created private organization. OceanFalls Corporation continued to be the taxpayers' financial responsibility under the umbrella of B.C.Cellulose. B.C. Cellulose's formal relationship with Ocean Falls Corporation is limited to providing loans.Mr. Ray Williston is chairman of both corporations.

Between 1974 and 1978 Ocean Falls Corporation spent almost $12 million on mill renovations andequipment-upgrading in an effort to save that plant.

MR. LAUK: Under which government?

HON. MR. PHILLIPS: Under this government! If you'd pay attention you wouldn't have to ask allthose stupid questions.

MR. LAUK: You're incompetent.

HON. MR. PHILLIPS: Well, I want to talk a little bit about incompetence. I'll tell you I listened tothe member for Prince Rupert (Mr. Lea) just a little while ago, and I have never heard such an incompetent,nincompoop speech in this Legislature in my life. They have been here asking for the Legislature to berecalled, begging that we recall the Legislature, and then they come in here and all they do is bring inmotions that they want to adjourn debate. They're not prepared. Not once did he mention the principle of thebill as he tried to debate it.

MR. LAUK: On a point of order, while the minister is calming himself, I think, Mr. Speaker, sir,you will find that "nincompoop" is an unparliamentary expression. I ask the minister to withdraw that attackon the hon. member for Prince Rupert - and on the hon. member for West Vancouver-Howe Sound (Mr.Reynolds), who was so embarrassed and hurt that he has left the chamber,

HON. MR. SCHROEDER: On the same point of order, I distinctly heard the member who had thefloor and who was making his speech say it was a nincompoop speech. I would agree if he had called anymember in this House a nincompoop it may have been unparliamentary, but clearly he referred to themember's speech.



MR. LEA: As I'm the butt of that unparliamentary term, I don't know whether to be insulted or not.What I want the minister to do is explain what "nincompoop" is, so we in this House can know whether itwas an unparliamentary word.

HON. MR. PHILLIPS: I will withdraw the word "nincompoop." The very fact that the memberfrom Prince Rupert doesn't understand what it means shows how incompetent he is.

The second member for Vancouver Centre (Mr. Lauk) was talking about incompetence. I have to sayagain, Mr. Speaker, that I have never in all the years that I have been in this Legislature seen or heard suchan incompetent opposition. At one time I used to think they were a good opposition, and that's what theywere best suited for. But now they're not even capable of or suited to being opposition.

However, Mr. Speaker, back to the bill. Between 1974 and 1978 Ocean Falls Corporation did spendabout $12 million on mill renovation and equipment upgrading in an effort to save this mill for the people ofBritish Columbia. Losses increased dramatically in 1978 and 1979 due to escalating wood and energy costs.


[ Page 713 ]

In 1980 a very difficult decision was needed and was made. The corporation's newsprint mill wasshut down in June, but studies indicated that logging and a flitch mill would be feasible for new products,depending on markets recovering. With markets now on the brink of recovery, active negotiations areunderway to utilize facilities at Ocean Falls and provide a basis for private sector initiatives in logging andsawmilling. This is due to the preservation and expertise of Ray Williston and the long-term planning of theSocial Credit government. It has been a long, hard battle, and the ideal resolution is far from certain.

Mr. Speaker, I move that the bill be now read a second time.

MR. LOCKSTEAD: Mr. Speaker, that was a pretty short opening speech by the minister.

Before I start into my presentation, you should know that Ocean Falls is in my riding. It's been amatter of discussion in this House over the I I years that I've been here.

Interjection.

MR. LOCKSTEAD: What speech? That member doesn't know from anything. I've spoken on thismatter in every session, on numerous occasions. In the last session of this Legislature that particular issue ofOcean Falls was raised by me some 18 times without one direct answer from that minister over there.

What I started to discuss with you, Mr. Speaker, was that I strongly object to the government'scoming in here, as they've been doing week after week, changing around the order of bills so that we don'tknow from one minute to the next what bill is going to be brought before this House. At a time when weshould be discussing the budget we've only have three days of budget discussion.

HON. MR. PHILLIPS: To the bill.

MR. LOCKSTEAD: To the budget, Mr. Speaker. Why aren't we in here discussing the budget like




we should be? You're trying to ram these bills down the throats of the people of British Columbia. Theyknow very well that we will not let this atrocious legislation pass in this House. As a democratic and loyalopposition we have a duty in this House to protect the interests of the people of British Columbia, and Idamn well intend to take part in that protection. That's the reason I was elected.

Anyway, back to the bill, Bill 30, speech number 6. Mr. Speaker, I just want to go back a bit for theedification of some of the new members in this House who are down having coffee right now. Well, that'sall right. I go down for coffee myself, Mr. Speaker, once in a while. There's nothing wrong with that. I justwant to back up a bit and give you a bit of the history of Ocean Falls since I've represented that area.

The community at one time had about 1, 200 employees and was thriving. In about 1971 CrownZellerbach Ltd. which owned and operated Ocean Falls at that time, made a public statement that they werein fact considering closing the operation. There was an election coming up in 1972, so a number of thingshappened. Specifically, Mr. Williston, who was then Minister of Forests, and Mrs. Isabel Dawson, nowdeceased, God rest her, went into Ocean Falls and met with the Crown Zellerbach Company. To make along story short, I think for political reasons it was decided . . . .

I'm a little ahead of myself. This was about 1969, just after the election, and there were meetingswith the company. To make a long story short, the company resolved not to close down the operation. Idon't know precisely what the transaction was; I believe it was on the basis of Crown Zellerbach's receivingmore timber rights on the coast of British Columbia, or having their long-term timber rights renewed. In anyevent, that decision was made, and as a consequence a number of things happened.

The government built a brand-new school at a cost of I don't know how many millions of dollars.Included in that school was the largest gymnasium in any school in British Columbia, most of which waspaid for by private funds and public subscription, not through government funds or the local school board.That school is still there, by the way; we'll talk about all those things later. Another major construction wasa brand-new, fully equipped modem hospital with, I believe, nine beds. I'm just going from memory.Certainly it was one of the most up-to-date facilities in British Columbia.

All of those things were based on their promise that that operation would remain open, but lo andbehold, in the early spring of 1972 Crown Zellerbach decided to close the operation. This was a few monthsprior to the 1972 provincial election. It really was a black eye for the government when all these manymillions of dollars had been spent for the library, for a new liquor store and all kinds of things. All thismoney was spent, and a decision was made arbitrarily by the Crown Zellerbach Corporation to close thecommunity. By August of 1972 termination notices had been given, people were in the process of movingout, and the operation was to cease total operation by August ....

I'm going once again from memory, because I haven't had an opportunity to get my notes. The waythe government handles their business in this House is simply atrocious; no other House in the BritishCommonwealth handles their business so atrociously as the people do in this House. But my notes will bealong shortly. I may be out a month or two on precise dates, but the time-frame is approximate.

[4:00]

In any event, Mr. Speaker, the community of Ocean Falls was due to shut down completely, underthe Social Credit government of that day, on, I believe, September 30, 1972. In the meantime, somethingfunny happened on the way to the forum, There was an election, and a good government was elected on



August 30, 1972. For the first time in the history of this province a good democratic socialist governmentwas elected, a government that felt responsible to all the people in this province. Early in 1973 the thenMinister of Lands and Forests, Mr. Bob Williams, announced to the people of British Columbia that we hadpurchased Ocean Falls for $1 million, I am sure the minister who brought this bill to the House remembersthat, because he was in this House at the time.

That operation then became a Crown corporation. It was a reduced operation. By that time therewere some 500 employees in the mill, and it saved the jobs of the 500 people employed directly in the mill,and saved the community itself. There were some 1, 200 to 1, 400 people, including children, in thecommunity at that time. The purchase price was approximately $1 million to the people of the province, andin my view, it was a good purchase on behalf of the people of the province.

[ Page 714 ]

I might point out - and I'm going to point it out again later in this presentation - particularly for thebenefit of the new members in this House, that that operation showed a profit for every year of operationunder a New Democratic Party government, including, I believe, the year 1976 when the Social Creditgovernment regained office in this province, although the profit for 1976 was minimal. As I recall, it wasbelow $100, 000, but it did show a profit even in 1976.

AN HON. MEMBER: More than our money back.

MR. LOCKSTEAD: Far more. Not only did the operation show a profit as a good free enterprisetype of operation" where you make a profit on your investment and all these things, but it did more thanthat. Ocean Falls was the focal point for the whole central coast community. If you needed good hospitaltreatment, libraries, recreation facilities -these kinds of things, whatever - all those things were there. But itdid more than that. The people who were employed in that community paid taxes to the federal andprovincial governments. And so we had that return. There were water licence fees. There were all kinds ofreturns to the province of British Columbia as a result of that community and that corporation operating. Sothere were those returns to the people. But it did something else that is very important. And the ministerover there, who brought this bill before the House, knows very well how important offshore dollars are tothe economies of British Columbia and Canada. That corporation returned literally hundreds of millions ofdollars over those years to the province of British Columbia and to Canada - offshore dollars that otherwisewould not have come to British Columbia, that otherwise would not have been available to BritishColumbia. So those dollars were injected into the British Columbia economy as well.

[Mr. Pelton in the chair.]

I see the minister is giving me a long look, and I understand why he is looking at me that way. It'sbecause we understood at the time that we purchased - and I say "we" because I was part of the government,although I was quite a way back on the back bench; you actually needed binoculars to find me back there,but I was part of that government and proud to be part of that government . . . . In any event, we understoodvery well that the operation was old and would not compete in the modem industrial age, with the largecompanies like Crown Zellerbach at Elk Falls and MacMillan Bloedel at Harmac, Powell River and Alberni- certainly at Powell River and Harmac - modernizing, putting in thermal mechanical pulping operations andthese kinds of things. In the future that operation could probably not compete in world markets. As a resultof that, the then Minister of Forests retained Simons and Co., a leading pulp mill consultant, recognized allover the world, to do a study of the best future for that community, of the operations of that corporation, of




the best return for dollars invested, and all of those things -good free enterprise principles that we're allfamiliar with and cherish when we see them around here. We hardly see them any more in this province, butonce in a while there's a bit around. The study was finally completed in November 1975. As you know,there was an election in December 1975 and that huge study was then given to the present Social Creditgovernment in February, as I recall, of 1976. The present chairman of the board was good enough to let mehave a look at that study, although the study has never been made public. I've asked that the study - someyears ago, but there's no point now - be tabled in this House. It never was tabled. It has never been madegenerally public. However -and I'll be referring to this a bit later - somehow I received a summary of thatstudy in a brown paper envelope in 1976, and I'll be quoting from it later.

But I want to back up a bit, because I really haven't had the opportunity to discuss this. There areprobably other members in this House who are more knowledgeable about this matter than I am, but I wantto refer to it in passing. When the NDP were the government and Ocean Falls was operating at a profit, thethen opposition, the Social Credit members who were sitting in this House at that time, continually railed atour members on the treasury benches about the purchase of Ocean Falls. They said that it had been a wrongand a bad buy - it was a Crown corporation. "Give it to private enterprise, give it away, close it down, dowhatever." The fact is, as I attempted to point out a while ago, that corporation did show a profit, did keep alot of people employed in the province, and did do a lot of good for British Columbia.

There was one particularly bad incident, which I'm sure some of the members recall. I'm sure theminister sitting opposite who introduced the bill will remember this. I don't remember the precise details,but I will if I have the opportunity to go through Hansard and get the details, which I'm sure I will do to jogmy memory and the minister's. This was more than an incident; it seemed to be a totally unfoundedallegation at the time that the Crown corporation and directors were somehow selling the pulp and paperproduced in that community at some warehouse sale price and that some stock promoter was making a greatdeal of money out of the on-the-spot market by reselling paper and products produced in Ocean Falls. Thisturned out to be almost totally incorrect. It's a common practice when you're selling pulp, paper, oil, sowbellies, beans, wheat or whatever, particularly when you have no firm markets, although there were firmmarkets.

I'll get into that after a while, because there were further allegations and transactions and contractsbroken with the Los Angeles Times. I'll give the minister a clue now so he can make notes and we candiscuss the Los Angeles Times incident later in this debate. It left the impression that some promoter wasgetting rich on products produced in Ocean Falls. Allegations were made in this House and there were itemsin the newspaper, most of which were totally incorrect and unfounded. I just wanted to jog the minister'smemory and remind him that those kinds of allegations were made on this side of the House when theywere in the opposition. When we stand up on this side of the House to make allegations based on goodresearch and on fact, they yell across the floor, "Wrong again." The fact is that that irresponsible oppositionmade those allegations regarding Ocean Falls between 1972 and 1975, without one shred of evidence that Ipersonally am aware of. I didn't appreciate that. These were people in my community who I represented.They were trying to make an honest living, and I didn't appreciate that very much.

The study I referred to still has "confidential" stamped all over it. As I said, I received itmysteriously in the mail in a brown paper envelope in 1976. It's not the whole study, but the summaryindicates that the Simons study actually recommended three alternatives based on the future of Ocean Falls

[ Page 715 ]




so that operation could become a profitable and viable operation. I'm going to quote just a bit. Ibelieve this is a summary of the summary; I don't want to read it all at this point. I might later. Thisalternative would have had the newsprint production retained at 100, 000 tons a year using the existingground wood and newsprint facilities. The bleached-kraft mill would produce 253, 080 tons of bleachedmarket pulp and 19, 0801 tons of semi-bleached sludge for newsprint finish.

Alternative 2. A new bleached-kraft mill and a sawmill complex, as indicated in the base case,would be constructed at Bella Coola. Three, the new bleached-kraft pulp mill would be located at OceanFalls, the base case, where the sawmill operation is split between Ocean Falls and Bella Coola. Those arethe three alternatives.

I'm sure that sounds like a lot of gibberish. It doesn't really make much sense unless you read thewhole study. Basically what we were saying in these three recommendations . . . . The recommendationwhich was favoured by myself and the managers of the Ocean Falls Corporation at the time was acombination of a new kraft mill at the Ocean Falls Corporation site coupled with a plywood mill, because ofthe cheap electrical energy. Right now, there's literally . . . . Every time the price of a barrel of oil goes up,that hydro power, which is going over the dam now and not doing anything, becomes more valuable. Inother words, Ocean Falls had access, at that time, to cheap electrical energy. It is now and has for severalyears been going to waste.

Interjection.

[4:15]

MR. LOCKSTEAD: I just don't recall. I don't have it in front of me, but I know it was quiteextensive.

As well, that alternative would have included a one-half million board feet a day sawmill complex atBella Coola, which would have increased the tax base in that community, utilizing timber primarily from theChilco plateau, which is quickly being alienated but at some future time will come down through the BellaCoola valley. The residue suitable for pulp and paper manufacture would have been barged down to OceanFalls for processing. That alternative would have provided employment for many of the 1, 200 native Indianpeople located at Bella Bella, because part of that plan would have been to utilize timber on the central coastof this province, which is also being alienated very quickly by this government through long-term leases toother companies. But at that time, it was the single largest block of timber remaining in Crown hands. Rightnow it's being alienated. I think Crown Zellerbach has a piece of it; I know Weldwood has; also othercompanies that don't come to mind. In any event, that timber is being alienated. The plan would haveprovided employment on the logging operation side for our native Indian people in the Bella Bella area. Alot of that timber certainly was suitable for plywood production.

Part of the thinking of the government of the day was that rather than have everything processed onthe lower mainland - there was some decentralization - we would keep that operation decentralized becauseof the schools, hospitals, houses and modem homes in that community, and have some of the workperformed . . . . You wouldn't be aware of this, Mr. Speaker, but there is a great deep-sea port in OceanFalls of all places, which has no railroad or roads leading in or out. Nonetheless, this would have created allthese new jobs, had any one of these recommendations been followed, particularly the recommendation Ipersonally favoured because it would have provided jobs for our native Indians in Bella Bella, which is aneconomically depressed area. It would have provided a couple of hundred jobs for people in the Bella Coola



valley and provided a tax base for the whole central coast region, so they could enjoy some of the thingspeople enjoy perhaps on the Sunshine Coast, Delta, the lower mainland, wherever.

They have a very difficult time in terms of tax base in that part of the coast. You can understandwhy: a total population of possibly 2, 400 in the Bella Coola valley, and some 1, 200 people in Bella Bella,which is a large Indian village, as you know; 70 people now in Ocean Falls, but as of June 1980 there wereabout 1, 200 to 1, 300 people who remained in that community. That's just a bit of background.

My point is that the government had all this information to work with but it did nothing. I grant youthat the operation did stay in existence until June 1980, as I said. It did show a loss; we can read thequarterly financial reports and annual reports as well as anybody else, but even with the losses, it was thethinking of some economists that the mere fact that 450 people were employed there contributed to the totalwelfare of the total provincial community, through taxes and through offshore dollars coming into thisprovince; this would suggest that the community could have remained open until a plan had been completedto modernize the system. I know the minister is familiar . . . . In the minister's closing statements on this billwhenever we close debate on this bill, next month or whenever - I expect to hear that studies were carriedout. There was the central coast timber survey; there is a bit of question mark around that one; I hope youremember to get back to that particular topic at some time. In fact, I think I'll make myself a note, Mr.Speaker, if you wouldn't mind. There's a little bit of funny goings-on with that survey. Studies were done onthe operations: were the energy requirements sufficient to meet a thermo-mechanical pulping operation?

Mr. Speaker, you might be interested to know that a thermo-mechanical pulping operation utilizessome 90 percent of the fibre, whereas the sulphate and sulphite operations in pulp and paper mills utilize 55to 60 percent of the fibre. So you get much better use out of the wood production.

Talking about wood production, I'd better make another note here. The government did do studiesand, of course, the energy requirements for a thermo-mechanical pulping operation in Ocean Falls - oh,availability, that was the word . . . . They did, in fact, do these pretty expensive studies, and I presume, sincethey closed the community down eventually, they decided that the whole operation was far too expensive.But, Mr. Speaker, I know that it's hard to capture the interest of the whole province in a community that hasbeen closed down for three years. A lot of people have perhaps forgotten about it, but I think it's important -possibly it's my last chance - to get this matter on record, and I intend to utilize this opportunity on behalf ofthose people remaining in Ocean Falls; not only on behalf of those people, but for the 55, 000 to 60, 000people who have passed through at one time or another and have lived and worked in Ocean Falls, includingtwo members of this House that I'm personally aware of.

So, Mr. Speaker, one of the excuses the government used in terms of this study, and one of theissues they used in debate time and time again in this House, was that when we purchased Ocean Falls fromCrown Zellerbach and set up the new corporation of Ocean Falls, we didn't include availability

[ Page 716 ]

of wood supply. But as I recall that contract with the Crown Zellerbach company at the time, a long-range contract was signed with Crown Zellerbach that they would guarantee, no matter what, even ahead oftheir own operations, a wood supply to that community - a contract which, as far as I am aware, theyhonoured for the duration of that contract. As a result of the Simons report - and it was our government'sintention to make available to Ocean Falls, when the study was completed, which it was in November 1975,and presented to this government in 1976 . . . . We would utilize timbers from the Chilco plateau, and




particularly the central coast area, for the Ocean Falls area.

Now, I'm very sure that the large corporations in this province probably were very upset when theybecame aware of the contents of the study. Not that Ocean Falls would remain in operation - they didn'treally care about that, because it was a relatively small operation compared to Powell River, Elk Falls,Harmac or corporations of that size. But I think they became very concerned when they discovered that oneof the recommendations in this study was that this timber be allocated to the Ocean Falls Corporation andnot to themselves. I think that at that point they became very concerned. I think this government - and Ihave nothing to back this statement up because I did not have tapes in the minister's office, and I got nobrown-paper envelopes, and nobody from any of the large companies came and told me . . . . As a matter offact, I did have word from the representative of one of the large companies at some point, come to think ofit. But as my colleague says, it's logical that the large companies weren't very happy with this, and no woodwas allocated to Ocean Falls - none of the recommendations in this study, of which this is only a summary;the study is volumes. That's part of the reason why the government made no move at all, and in facteventually closed down the operations.

I think part of the other reason that the government closed down the operation was sheer politicalvindictiveness.

AN HON. MEMBER: They voted NDP.

MR. LOCKSTEAD: Yes, good point. We carried Ocean

Falls for many, many years, as far as I can remember, going, back to, in fact, Bakewell. We oncehad a candidate who was fired for running as a candidate for the CCF in Ocean Falls. He was never rehiredat Ocean Falls because he ran as a candidate for the social democratic party - a party with a conscience. Heran for that party and was never hired back. I had the good fortune, by the way, to meet with Mr. Bakewell'sson just a short time ago, who, by the way, is older than I am ,

In any event, I might pat myself on the back a little bit. In 1975 Ocean Falls voted 96 percent for theNew Democratic Party.

AN HON. MEMBER: The kiss of death.

MR. LOCKSTEAD: Yes, that's why I mentioned the words "political vindictiveness."

I believe that the government had made up its mind, when it was elected to office in 1975, no matterwhat, not to take the operation of Ocean Falls seriously and to close that community down - no matter what- in spite of the fact that there were 150 modem homes in Martin Valley, adjoining Ocean Falls. There'sroom in the huge, modem apartment buildings alone for some 2, 000 people, 1, 500 families, plus the oldersection of town, much of which has been tom down over the last eight years, home after home after home.Had those homes been anywhere else in British Columbia they would have commanded a very handsomeprice, but they were tom down, wrecked; garbage, gone forever.

I firmly believe the government was showing its political vindictiveness and had made up its mind,on its re-election to government in 1976, to close that community down no matter what. Today, thatcommunity could be open and operating; there should be at least 1, 000 people actually employed. Thatcommunity should be serving the whole central coast area. The hospital is shut down. A $2.5 million school



is shut down and just sits there, idle. Brand-new firefighting equipment that any smaller community inBritish Columbia would be proud to have, shut down. Nobody there. Nothing. A brand-new hospitalfacility, totally equipped, X-ray equipment, everything that you'd want in a modem hospital is sitting thereempty. As a matter of fact, after the government finally closed the community for good in 1980 thearrangement was that a doctor would be flown in once a month. Would you believe it? Once a month. Eventhat hasn't worked. A lot of things haven't worked since then, but I'll get to that a bit later. The people upthere don't even have the services of a doctor on a monthly basis. Now, if something happens and they haveto see a doctor, they go by private pleasure boat or private craft of any kind, or by charter aircraft, which isvery expensive, by the way. They have to fly down to what is now a modem facility at Bella Bella. Luckilythere is a private person in the community who has some nursing experience, so that's of some assistance.

That's the state of the community right now. That's a thumbnail sketch which I'll probably go overagain later, Mr. Speaker, and possibly in more detail when I have a chance to look through the stuff. Thatthumbnail sketch takes us up to June 1980, when the government, through the Crown corporation, sent aletter of termination and intent to all of its some 400 employees who were still employed at the mill at thattime. In that letter, a copy of which I have somewhere in this pile of stuff in front of me, the governmentpromised - in writing - that within six months there would be a new operation in place in that community,possibly a chip mill or whatever . . . .

Interjection.

MR. LOCKSTEAD: Oh, it's on file. It's from you. It's a government letter, Mr. House Leader,through you, Mr. Speaker. Ask the minister. He must have it.

[3:30]

Interjection.

MR. LOCKSTEAD: Well, I'll tell you what, Mr. Speaker. Because of the atrocious way thegovernment handles business in this House, calling bills on the spur of the moment, without letting ourWhips know what's going on, I wouldn't have this document, which is here in this pile of stuff. I barely hadtime to go and grab it out of my office and come roaring in here to take part in this debate. If the HouseLeader wishes to come over and go through my files and pick out the letter that I'm referring to, which I willfind as soon as I have the opportunity, he's welcome to do so. As well, in going through these files in anorganized manner he might learn something about what happened at Ocean Falls. In fact I

[ Page 717 ]

think just by sheer luck, Mr. Speaker, I grabbed this. It was right on top of the first pile. Would youbelieve that?

HON. MR. GARDOM: That's good organization.

MR. LOCKSTEAD: At least I'm organized. You guys over there don't know from one minute tothe next what business you're dealing with. No wonder this province is going to have another billion and ahalf dollar deficit this year, on top of the $1.3 billion last year. There was no deficit under an NDPgovernment. We made money. We left this government over $400 million in 1975, and what have theydone? They've squandered it and run this province into debt. Now they're trying to pay off the debt on thebacks of the poor and the working people. They're doing away with human rights and bringing in a so-




called restraint package which has absolutely nothing to do with many of those bills of restraint. They'resimply anti-people bills. This bill is part of the package. What's restraint about this bill? What you couldhave done under this bill, had you been organized and doing your job, Mr. Speaker, to the House Leader . . .. I've decided to be designated. What the heck, I've got lots of time; I'm not going anywhere.

DEPUTY SPEAKER: The hon. member for Mackenzie has been designated as the speaker on Bill30.

MR. LOCKSTEAD: I haven't even had a chance to go through all this stuff yet, and I want to get itall in the record.

AN HON. MEMBER: When are you going to start saying something?

MR. LOCKSTEAD: You haven't been listening.

Well, Mr. Speaker, where was 1? 1980. Closure. The letter and a statement from Mr. Ray Williston,chairman of the board, Ocean Falls Corporation . . . .

Interjection.

MR. LOCKSTEAD: Yes, I think I will. I think it should be read into the record. This was datedMarch 6, 1980. This was the date, Mr. Speaker, that the government, through its Crown corporation people,Mr. Williston, announced the imminent closure of Ocean Falls. The final closure date by the way, as Istated, was June 30, 1980. The letter says:

"Changing economic circumstances, related to increasing input and operating costs, have forced the Ocean FallsCorporation management to recommend that the newsprint mill must be closed down in the near future. All avenuesto remedy the situation and to maintain an expanded newsprint mill have been exhausted.

"A proposal for modified and expanded milling operations to support the community, which could eventually lead toa new kraft pulp mill, is outlined below. It has been determined that the production of kraft pulp at Ocean Fallscould be feasible if the necessary volume of woodfibre at competitive cost could be assured through some form ofpulpwood agreement.

"The Minister of Forests has ruled that the present standards of wood utilization on the midcoast will not permitexpansion of the allowable annual cut to ensure the required timber supply for a new or expanded pulp mill."

Now this, Mr. Speaker, just to stop there for a minute, is exactly the point I was trying to makeearlier, in conjunction with the Simons study. The government knew very well that in order for the OceanFalls Corporation and that operation to stay in effect, they would have to designate timber from the centralcoast and Chilko plateau areas, as recommended in the study to the Ocean Falls Corporation. Thegovernment had from 1976 until 1980 to do that, but they did nothing. They did studies but nothing else.They had a good five years to rectify that situation and make those decisions, but they made no decisionsand did nothing.

One of the things I'm leading up to, and I want to get this on the record now, is that - and this willcome out as I go through this material - the employees were promised that within six months a new type ofoperation would be in place in Ocean Falls. A flitch-and-chip mill is . . . .




You know what a flitch is. A flitch is a piece of a log that has been squared on four sides, whichbasically makes them logs eligible for export to a foreign country - usually from British Columbia to Japan,which is fine. They can do that legally, without that log being called a raw log. It didn't, then, have to gothrough the log export board or anything like that. You just knock off the bark on four sides so it's kind ofsquared. A normal flitch still has bark on the comers, but it's called a square timber - which it wasn't. Thechip part refers to a particle board type of operation, which Mr. Williston did a great deal of work on. Butthat is not the point of what I'm saying here.

The point is that the government promised that within six months there would be a new type ofoperation in that community. Quite obviously, the government didn't keep its word. A lot of people stayed inthe community hoping that something would happen.

By the way, I want to rectify that shutdown date, just for the record. Somewhere back in my speech Isaid June 30, but the document I have before me shows that the phase-three, total shutdown was June 1,1980 - just to keep the record straight.

In any event, the government did promise these people who stayed in that community. Smallbusiness stayed in that community because there were some small business people in that community,people who had private stores and little operations but who made a living there. They stayed in thatcommunity, and there was no sign of a flitch-and-chip mill or anything else after 1980. It was just anotherbroken government promise.

Interjection.

MR. LOCKSTEAD: No, I'd like a smoke.

Interjection.

MR. LOCKSTEAD: Well, I'm just going back. I know it's boring. We're discussing a communitythat's been part of British Columbia since 1908, I believe.

Interjection.

[ Page 718 ]

MR. LOCKSTEAD: The member who's not in his seat - he's sitting in the Premier's seat and hopesto be there one of these days - asks if we're going to pay the $35 million one of these days. Had thegovernment used good, sound management practices in that community instead of setting out on a politicalvendetta, not only would the $35 million have been repaid, but that operation would also have continued tobring offshore dollars into this community.

Interjection.

DEPUTY SPEAKER: Order, please. I'll remind all members that it's unparliamentary to heckle atthe best of times, but heckling when one is not in one's place is even more unparliamentary.

Interjection.




DEPUTY SPEAKER: Order! Perhaps the member might return to his seat as well.

MR. LOCKSTEAD: I didn't mean to get that member into a lot of trouble. Gee, I feel like I'm backin grade 4. I didn't want to squeal on him. I enjoy that member. Once every third week he comes up with areally good interjection.

In any event, where was I? I was saying that I know that a lot of this is dull stuff, but the fact is thatit may be the last chance to get the Ocean Falls situation on public record, and I intend to use theopportunity. That operation had been a vital part of British Columbia's economy since, I believe - onceagain I'm going from memory - 1908 or so. It was somewhere around that time that the Ocean FallsCorporation was originally founded in that community by a Mr. Martin and another free enterpriser, whoprovided many jobs for many people in this province for many years. At one time, you may be interested toknow, there were about 5, 000 people employed in that community, believe it or not. The largest hotel inBritish Columbia was the Martin Inn at Ocean Falls. It was six storeys, with I don't know how many rooms.It's still there and operational. The last time I was up there, during the last election campaign, there were meand three others, and we had our choice of about 700 rooms. We had the whole place to ourselves prettywell.

[4:45]

Anyway, getting back to 1980, I guess the point I was trying to make is that the government made acommitment in writing to the people of that community, and in effect to the people of this province and tothe people in this Legislature, that there would be an alternative operation in spite of the fact that the pulpmill was, in their words, obsolete. It probably was - some of the machines up there were very old andneeded modernizing. I heard some but not all of the minister's opening remarks; I'll see them tomorrow inHansard. I know that a lot of money was spent on studies, and that there was some $12 million on the headboxes, and I know what head boxes and these kinds of things in a pulp mill are. I live in a pulp millcommunity, as a matter of fact, as you probably know, Mr. Speaker. I know those moneys were spent, butwhy did the government spend those moneys if they had no intention of modernizing the community, orallocating wood to the Ocean Falls Corporation? They could have done that, particularly once this studywas completed. This really bums me, Mr. Speaker, and makes me extremely angry. We were a bit lucky asgovernment that that operation in Ocean Falls made money. We knew that the pulp mill was old, that themachines were obsolete and needed modernization, and the government was very much aware of all that.The government did nothing from 1976, in spite of the fact that they had the results of the study which wedidn't have, commissioned by our government, not based on any other principles but good private enterpriseprinciples, on return on investment, etc.

Any of these three options at that time, because in 1976 interest rates were somewhere around 10percent, would have resulted in a net return of 10 percent on funds invested, so this wasn't some fly-by-night type of recommendation put forward. The government knew that in 1976 and right through 1980.Anyway, they did close the place down. They did promise the residents a newsprint mill. I'm just quotingfrom Mr. Williston's letter to the employees: "The newsprint mill now employs approximately 410 people.About 100 workers will be initially required to operate the modified wood-processing plant on a two-shiftbasis. Logging crews will be able to operate from Ocean Falls, and this will increase employmentopportunities centred on the town." There was not one job, in spite of 150 people they're possibly talkingabout here. In spite of opportunities they may have had to go to other pulp and paper mill communities topractise their trade, they stayed in that community on the basis of this government promise that a new



operation would be in place in six months. What happened? Absolutely nothing. I think there was a furtherstudy, then there was a study to study the study, and then some studies to study those studies.

There was one study which I am a bit concerned about. That was a timber survey of the areaconducted at government expense by the Forest Service of British Columbia. There may have been someprivate people involved who were paid by the government, which is fine. It's normal practice - I'm notcomplaining about that. In fact sometimes, in terms of private timber consultants, you get a much better anda more realistic evaluation of the type of wood and what you want to do from them. There's some very goodpeople. I'm not knocking that. What I'm talking about here is a very expensive and extensive study - I havea copy and the minister is familiar with it, I'm sure - carried on by the government on the basis of looking atthe kinds of wood we have for our flitch-and-chip operation, for our particle board operation, to use low-grade cedar, quite a bit of which is located in the area. The study indicated there wasn't as much as theythought there was, by the way, but the study did something else. This is in relation to Ocean Falls and thecorporation; this is the reason the study was carried out, so I'm pretty sure I'm in order, Mr. Speaker.

The study did something else. That particular survey also found out and indicated where the good,merchantable timber was in that area. It had never really been done in that area before. Nobody really knew.So it was a whole, comprehensive study. I want to be very careful here, because I don't want to get peoplein trouble if they don't deserve it, but certain people were able to utilize that study, the results of which werepaid for by the government, for their own benefit and purposes, in the central coast area, knowing very wellthat the government would never utilize the results of that study in terms of operations at Ocean Falls.

A lot of allegations have been made, particularly from that part of the coast, with regard to who gotwhat and who got the freebies in terms of the results of that study that was essentially paid for by thetaxpayers of this province. That's a story that may or may not come out in this House at some

[ Page 719 ]

future date, but I think the minister will probably know what I'm talking about. If he doesn't, I knowvery well the Minister of Forests (Hon. Mr. Waterland), who's in the House at the present time studying hisannual report, will know what I'm talking about for sure.

There have been further problems at Ocean Falls definitely related to the closure of that operation.One was the transportation into that community. Depending on who you listen to, there are some 65 to 80people still living in that community. Of course, as people had to leave that community, transportation inmany, forms ceased. There is no longer a regularly scheduled aircraft service into that community,understandably so. It simply would not pay for a regularly scheduled airline to fly in and out of Ocean Falls.So you have to charter out of the community.

But worse still, the government made a promise that it would maintain water services to thatcommunity and did initiate ferry service on a weekly basis to that community, particularly when peoplewere moving out. Okay, fair enough. Once again, the cost of that operation was about $200, 000 a year,according to B.C. Ferry officials. I believe that figure. The ferry corporation then decided to terminate thatservice into Ocean Falls because of the cost. You must remember that the government reduced the subsidyto the B.C. Ferry Corporation by some 25.1 percent last year I notice, just for the record, that the budget forthe ferry service, which is not part of this bill, has been maintained the same this year as last year, whichmeans a further reduction in subsidy to the B.C. Ferry Corporation. In any event, because of that reductionin subsidy, the B.C. Ferry Corporation board of directors decided to terminate service to Ocean Falls and




subsidize a private carrier. The net result of all of this . . . .

I am not opposed to the subsidizing of a private carrier on the coast of British Columbia in certaincircumstances. That just makes good common sense in some areas. It's much cheaper to subsidize a privatecarrier that is going in that direction anyway than it is to send a whole ten-tonne vessel into a small port ona weekly basis. There's nothing wrong with that under certain circumstances, and that's fair enough. But inthis case the residents of Ocean Falls were able to prove quite successfully that if the B.C. FerryCorporation would stop by in Ocean Falls once every three weeks, at a cost of about $60, 000 per year, theywould be able to get their food supplies in, and their vehicles in and out at a reasonable cost.

That would be at no further cost to the ferry corporation, and I'll tell you why. The government iscurrently paying, over and above the regular subsidy that this particular carrier is receiving, a further $60,000 a year at the present time. That contract goes, as I understand it, to December 31 of this year. Thatprivate carrier is currently unable to meet their commitments. It is not a passenger service, so people arebasically stuck in or out of Ocean Falls, or have to charter a private aircraft, which is very expensive, orthey have to hire a water taxi, which is also very expensive. Service has not been maintained.

I spoke yesterday morning, just as luck would have it, with a gentleman, Al Parkes, who operates thehotel and store in the community. He has not utilized - and, in fact, can't afford to utilize - the subsidizedprivate carrier currently serving Ocean Falls. So that people can have food at a half reasonable price - stillfar above what we pay here in Victoria or in Vancouver or Powell River - he has now been forced to hire afishboat to go out once a week, at some considerable cost, to either Port Hardy or Bella Coola to bring foodand supplies into that community. Would you believe that this is in spite of the fact that this government ispaying a private carrier $60, 000 a year extra to call in at Ocean Falls? I understand they've made only twotrips into Ocean Falls, in any event. Obviously it does not appear that the private carrier is living up to hiscontract; he says he has no reason to call in there because there is no freight. He tripled his rates since thecontract was signed, and this government is taking no action. I've been in touch with the Minister ofTransportation (Hon. Mr. A. Fraser) and other people. I have received no response of any kind yet, but, inall fairness, I expect I will.

We're not talking about transportation estimates. We're talking about the residents of Ocean Falls andthe kinds of things happening to those people right now under this bill, as a result of the actions of thatincompetent government. Can you believe that it's cheaper for that small store owner to hire a fishboat in thearea, or anybody, to go 80 miles to Bella Coola every week - the highway ends at Bella Coola, as you wellknow; there's a wharf there - to bring back supplies than it is to utilitize the private carrier that is currentlyreceiving $60, 000 a year extra to call in at Ocean Falls? It has only made two trips - possibly three - thatI'm personally aware of. It is not providing the service but is still receiving that $60, 000-a-year extrasubsidy.

There are senior people in the B.C. Ferry Corporation who agree with this analysis compiled by theresidents of Ocean Falls. For that same $60, 000 a year that ferry could have called in at that communityonce every three weeks at no extra cost, and provided a reasonable service for the remaining residents in thatcommunity. It could have brought in food and things people need, at more or less the same cost as to otherparts of the coast of British Columbia, instead of the horrendous prices they now pay - and some kind ofreasonable service. But no, it's shortsightedness of the worst kind. On that particular topic, you'll be hearinga lot more from me during debate on the estimates of the Minister of Transportation and Highways inparticular.



I only raise the matter now to point out the current plight of the residents of Ocean Falls and toquestion what their future will be.

I'm just looking through some of my files. As I said before, I haven't had an opportunity to gothrough them in great detail, but I will have that opportunity this evening, and we'll get back to this bill,presumably tomorrow sometime.

I want to quote from a magazine called the British Columbia Lumberman, May 27, 1975: "The Buyof the Century: Ocean Falls." I'm just going to quote briefly from this article, which seems to be quitelengthy. I haven't looked at it since . . . . Well, I don't read the files on Ocean Falls every day, so I haven'tactually seen this particular magazine since 1976. But anyway, we'll have a look, and I'll do a little quotingfrom it. What I'm attempting to point out here . . . . We were talking about the desirability of . . . and thegood bargain the government made in 1972. Actually it was in the fall of 1972 when we purchased OceanFalls, when the social democratic . . . .

[5:00]

HON. MR. HEWITT: That was your first mistake.

MR. LOCKSTEAD: You weren't here when I pointed out and made my arguments about why itwasn't a mistake.

[ Page 720 ]

Just for the benefit of that member who just walked into the House . . . . I'm sure he had someimportant business: he was probably in cabinet or maybe in a legislative committee meeting, drawing upsome more legislation to bring into the House - probably more anti-labour legislation, right-to-work laws,and stuff like that, and maybe a gerrymander bill or two. I don't know what he was doing out there. Just forthe benefit of that member, who was not in the House, I'm now forced to repeat my argument on why OceanFalls was a . . . .

Interjection.

MR. LOCKSTEAD: No, that member asked me a question, and I believe that every member in thisHouse has a right to know. Just a thumbnail sketch to that Minister of Consumer and Corporate Affairs(Hon. Mr. Hewitt). I'm sure you don't know this, Mr. Minister: between 1972 and 1975 the Ocean FallsCorporation showed a profit in every one of those years. Those are the years, by the way, when the NewDemocratic Party was the government of this province. I see the Minister of Forests (Hon. Mr. Waterland)shaking his head. Don't shake it too much. He wasn't here. He wasn't even elected. How would he know?Just going from memory, because I don't have the accounts before me, I believe that even in 1976, in spiteof reduced prices for pulp and paper on the world market, the Ocean Falls Corporation showed a profit ofunder $100, 000, somewhere in that area. I hope the Minister of Consumer and Corporate Affairs will do hishomework. He wasn't here either between '72 and '75, and that's why he's not familiar with the facts.

It's a strange thing. Those people over there just want to believe what they want to believe. Theydon't want to look at the facts or listen to the truth, because it hurts. Were you in the House, Mr. Minister,when I was discussing the fact that your government did not tell the truth in 1980, when in a letter to theemployees and the residents you said that within six months there would be a new and viable operation inOcean Falls? Where is that operation? That was in 1980. You didn't keep your promise. You didn't keep




your promises in the last election campaign. You said that in terms of government employees you wouldreduce the size of government by attrition, and what did you do? The moment you were elected you broughtin an atrocious bill laying off people and taking away people's human rights, You didn't talk about that in theelection. You're a government that's not given to telling the whole truth, or even part of it sometimes.

In this case in Ocean Falls and in Bill 30, the government as well . . . . When this letter was issued inMarch of 1980 telling the employees they were going to shut down the pulp mill operations in June 1980and said there would be a viable operation in place within six months, that's some three years ago, and we'restill waiting. Now we have this bill before us which totally abolishes the Ocean Falls Corporation.

I heard a portion of the minister's opening remarks where he indicated that they were negotiatingwith some private company. No details. We don't know who they're negotiating with, what the terms are, oranything else, and that's fair enough, but we would like to know from the minister, in his closing remarkssometime next month when we get to the crux of this bill, a bit more about the negotiations that are takingplace, what kind of operation they are talking about and what the terms of that agreement may be.

I just found a copy of the Sandwell report, which the minister is very familiar with, I'm sure. This isrelating to an integrated market study, potential products evaluation, the possibility of a thermo-mechanicalpulping operation in Ocean Falls, and going back for several years. But we won't go into that one unless wehave to.

As late as July 1983 . . . . Here are three or four current news clippings. I've only got these to triggermy memory. July 1983: "Logging Near Ocean Falls Raises Hopes." This is just what I was talking about.This was an article in the Province.

Interjection.

MR. LOCKSTEAD: He says to read it out. I was just reading it to myself, but I guess we'resupposed to read it out loud if we're going to read it in the House, aren't we? Just to quote from this verycurrent article, it relates to what I was saying about the minister not being candid with the House and givingus, during the course of his opening remarks, a great deal of information.

Interjection.

MR. LOCKSTEAD: Well, I didn't get much information. Of course, I was out of the House for awhile, but he didn't tell us very much about what kind of operation we are talking about or consideringlocating in Ocean Falls, what stage the negotiations are at or anything else. That's simply not good enough.

Here's another article. I haven't read this one yet, but we'll get to it. "Axe Poised Over Ghostly OceanFalls." Mr. Speaker, if you go into that community today you will see a couple of hundred homes boardedup. Large apartment blocks are boarded up. Homes in the Martin Valley - modem three-bedroom, full-basemented . . . .

HON. MR. PHILLIPS: It proves how wrong you were.

MR. LOCKSTEAD: Mr. Speaker, the minister interjects across the floor, which is fine, that itproves how wrong we were, the government, to purchase Ocean Palls. I thought I had attempted torationally point out to the minister, through you, Mr. Speaker, why the preservation of those jobs in Ocean



Falls for those employees and their families was not a disaster for the province. It only became a disasterwhen that government was re-elected to government in this province. They mismanaged Ocean FallsCorporation and the whole situation to the point where they couldn't make any money. After the totalmismanagement by that government and by that minister, then it made no money and they said: "Well, we'regoing to close the place down because we're not making any money."

I tried to point out to that minister, Mr. Speaker, that that corporation showed a profit in every yearthat the NDP operated that operation in Ocean Falls. It brought in I don't know how many millions ofoffshore dollars and paid taxes, water leases and everything else to the province. Every employee in thatcorporation paid income tax to this government and contributed in some way to the economy of theprovince. That corporation only became a disaster when that minister of disasters sitting over there gotcontrol of that corporation. That's when they started to lose money, and that's when it

[ Page 721 ]

became a disaster, and that's when the people of Ocean Falls started to lose hope.

HON. MR. PHILLIPS: Everything you guys did was a disaster.

MR. LOCKSTEAD: The minister says everything our government did between 1972 and 1975 wasa disaster. I've got your words on the record. I want to tell you it's quite the opposite. The New DemocraticParty government between 1972 and 1975 was probably the best government this country had seen in 114years of Confederation, in my view. Let's look at this House, for example. Let's start now. We'll just look atthis House.

HON. MR. PHILLIPS: You were rejected in 1963. You were rejected in 1966. You were rejectedin 1969. You were . . . .

DEPUTY SPEAKER: Order, please.

MR. LOCKSTEAD: Look at this House. This building was falling down, Mr. Speaker.

DEPUTY SPEAKER: Perhaps we could have just one at a time. Right now it's the member forMackenzie.

MR. LOCKSTEAD: Mr. Speaker, there was much more than that. Do you realize that there was noHansard in this House before 1972? We're just talking about this House, not the whole province, and ourrecord between 197 and 1975 including Ocean Falls.

HON. MR. PHILLIPS: It's a waste of money, recording the garbage you're drivelling across thefloor!

MR. LOCKSTEAD: Do you realize that there was no question period in this House? Now we'vegot question .... There's no answer period, but we've got a question period in this House.

HON. MR. PHILLIPS: You haven't asked an intelligent question since you come in this House.

DEPUTY SPEAKER: Perhaps if we'd return to Bill 30 we might maintain some semblance oforderly debate.




MR. LOCKSTEAD: Well, Mr. Speaker, they keep interrupting. I just can't take those remarks lyingdown. That member made some atrocious statements about the government between 1972 and 1975 - thebest government that this province has ever seen. That government over there has attempted to dismantlemany of the programs, including Ocean Falls, put in place by a very good government between 1972 and1975. Perhaps one of the reasons they were re-elected, Mr. Speaker, is they did not tell the truth out on thehustings. Did they tell the people that they were going to terminate without cause, fire people left, right andcentre, and do away with every form of human right that you can almost imagine?

HON. MR. PHILLIPS: Back to the bill.

MR. LOCKSTEAD: Mr. Speaker, that minister doesn't want to listen. He doesn't want to hear that,does he? I don't blame him. If he's so cocksure of his position, why don't they resign and call an electionnow, based on their legislation? They're gutless, that's why - gutless wonders.

DEPUTY SPEAKER: Hon. members, it's getting just a bit noisy here. I'll ask the hon. minister notto interject. That applies to everyone. I'll ask the member for Mackenzie to return to the principle of Bill 30.

MR. LOCKSTEAD: Well, Mr. House Leader -through you, Mr. Speaker ....

[5:15]

Interjection.

MR. LOCKSTEAD: I learned it in logging camps and mining camps. Some of the best words I'velearned I learned right here in this House, like "strawberry."

Back to the bill. I see the minister is running for cover -as usual. Mr. Speaker, I could just go on andon. There is a basic concept here. We've had a little fun. We've had, I hope, some serious debate and somehistory of this Ocean Falls situation, and I know that other members want to speak. But I'm serious when Itell you that over the I I years that I have attempted to serve the people in Ocean Falls . . . . We've attemptedto maintain that community, which contributed greatly to the economy of the province - a community thatshould stay in operation. There are a lot of things that can be done even at this late date. Utilizing therecommendations in the Simons report - a summary of which I have here -could return that community . . . .Because of the cheap electricity, the cheap energy costs there - the dam is in place; the four large generatorsare in perfect working order; the hospitals, the modem school, library and recreation centre .... All of thosethings are in place in that community. In my view, to close down that community is a crime against thepeople of British Columbia.

Well, I've just about . . . .

Interjection.

MR. LOCKSTEAD: Yes, I'd forgotten about that. That's right. In fact, I had a note on that. Where'sthe minister?

Mr. Speaker, this government, through the offices of its Crown corporation - and I'm sure we'll hearmore about this later on - signed a five-year contract with the Los Angeles Times and then proceeded tobreak that contract when they announced the closure of the Ocean Falls Corporation in 1980. I don't think



that figure has ever been revealed, has it? Have they ever told us how much it cost them? They settled outof court. This government was taken to court in a legal action by the Los Angeles Times, as I recall. Thegovernment reneged on that contract. The Los Angeles Times took this government and the Crowncorporation to court and they settled out of court. They never did go to court, and that figure has never beenmade public. I haven't been able to find it in Public Accounts, and I haven't been able to find it in the annualreport, nor have I been able to find it in quarterly reports from before the election.

Interjection.

[ Page 722 ]

MR. LOCKSTEAD: Yes, 1979. That's exactly right, an excellent point.

Is the minister at some point going to tell us how much of the taxpayers money went to pay off theLos Angeles Times in that out-of-court settlement? Why wasn't that figure made public, Mr. Speaker? Howmuch would you guess - three million or four million? We don't know.

Interjection.

MR. LOCKSTEAD: One guess is $8 million. Do I hear $10 million?

Interjections.

MR. LOCKSTEAD: We thought that these people .... They claimed to be good money managers,and they blew at least $3 million, $4 million or $5 million of taxpayers' money on a contract they didn'tkeep. You know what people who don't keep their contracts are called, don't you, Mr. Speaker?

MR. BARRETT: Used-car salesmen.

HON. MR. PHILLIPS: Better a used car-salesman than a social worker.

DEPUTY SPEAKER: I think we've had quite enough interjections.

MR. LOCKSTEAD: Now that the minister is in his seat, calmed down, with his earplugs out, and islistening, I wonder if, in his closing remarks next month or the month after - whenever we've completeddebating the second reading of this bill, Mr. Speaker - he will tell us how much of the taxpayers' money wasspent in that out-of-court settlement with the Los Angeles Times. You never made that figure public, Mr.Minister. That figure wasn't in Public Accounts.

MS. BROWN: Was it $8 million?

MR. LOCKSTEAD: We don't know.

Mr. Speaker, that relates directly to this bill, which I have before me. If the government had notmade that atrocious out-of-court settlement with the Los Angeles Times, perhaps Ocean Falls would beoperating today. That's why it relates to this bill. How do we know Ocean Falls wouldn't be operating? SoI'm asking the minister how much of the taxpayers' money he forked over, or under, or around, or through.How much of the taxpayers' money went to pay off that out-of-court settlement with the Los Angeles Timesover a contract which that government broke with that newspaper? How much, Mr. Minister?




HON. MR. PHILLIPS: Not as much as your leader paid Bob Williams to resign.

DEPUTY SPEAKER: I'll call the House to order again.

HON. MR. WATERLAND: On a point of order, is the member having a caucus meeting there, oris he addressing the bill? Although I'd much rather hear him speak than Tweetie Bird, I think he shouldaddress the bill.

DEPUTY SPEAKER: The member has brought to the Chair's attention that many other membersare speaking and interrupting, and the hon. Leader of the Opposition is interrupting as well. Perhaps wecould hear the member for Mackenzie on Bill 30. However, there are more points of order.

MR. COCKE: On that point of order, the minister obviously raised a spurious point of order to tryto distress my colleague from the great riding of Mackenzie. I think the minister is probably quiteembarrassed because of some of the things this government has done, and that's why he jumped to his feet.It had nothing to do with the fact that the member was asking his colleagues a question.

DEPUTY SPEAKER: The minister's point of order was well taken by the Chair, as the Chair ruled,because several members in the assembly were speaking at that time, when in fact the member forMackenzie had the floor.

MR. BARRETT: On a point of order, Mr. Speaker, it is the responsibility of the Chair to keep orderand see that speeches are not interrupted by anything other than bringing a point of order to the Chair'sattention. The minister did not have a point of order; he made a statement. I point out to the Chair that it isthe Chair's responsibility to keep the House in order, particularly the former Attorney-General and theminister whose bill is being debated. We'd get a lot more work done if order was maintained by the Chair.

HON. MR. WATERLAND: On the contrary, I was very interested in the speech by the member forMackenzie, but I couldn't hear it because of all of the little meetings taking place over there. I wish to hearhis speech and hear him direct his remarks to the bill under debate in the House at this time. As I said, I'drather listen to him than Tweetie Bird over there.

MR. BARRETT: That's not a point of order.

DEPUTY SPEAKER: Order, please. I think we've had quite enough, thank you. Now, if we canreturn to debate on Bill 30.

MR. LOCKSTEAD: I do think I will continue. I'm concerned for the residents. The minister hasshown no concern for the residents and the people in the whole central coast area of this province. I think Ido have a few more things to say on this bill.

I know that the minister will answer the question on what the out-of-court settlement was to the LosAngeles Times -how much of the taxpayers' money. They broke their contract to that newspaper, as they'vebroken many contracts and promises in the past and will continue to do.

I've been waiting to quote from this magazine for some time, but I just want to make this point. Ican tell from the attitude of that minister and some of the people on the treasury benches that thisgovernment has no intention whatsoever .... They'll say one thing and do another time after time, as with this



letter to the residents of Ocean Falls telling them that within six months they will have an alternate andviable operation that will employ maybe 150 to 200 people in that community. That was written three yearsago, and what have we got? Nothing. This is the same government elected to office some four months ago,who went around this province

[ Page 723 ]

telling people: "Vote for us and we'll practise restraint. There will be no firing without cause, nohospital user fee increases, no tax increases." That is what they did at Ocean Falls under this bill. They saidto these people that within six months it would be a viable operation, and what have we got? Backing up, interms of Ocean Falls, this article in the British Columbia Lumberman by Jean Sorenson is entitled "The Buyof the Century." I don't want to read the whole article; maybe I do. It's worthwhile reading, because it sort ofputs into perspective - and I'm sure the minister has read this article and I'm sure he has it in his files; he hasa photographic memory, anyway, so if he read the article, he would remember every word of it . . . . Just torefresh the memories of some other members in the House, so they'll understand a bit of the background, Ithink this is a good article to read into the record. It's from an article in the British Columbia Lumberman,1974, quoting a manager of the corporation:

"Skeptics who believe Ocean Falls" - I'm quoting now, for Hansard's sake - "should have been turned into a penalinstitution will have to deal with Ted Vesak."

Mr. Vesak was the general manager of the operation between 1972 and 1980.

"That may not be an easy matter. Vesak, mill manager, accountant, chairman of the Ocean Falls Corporation, andformer pulp and paper planner for Crown Zellerbach will tell you straight out: he believes in the future of OceanFalls. 'I've studied it inside out, ' he says. He'll also tell you Ocean Falls is sitting in the middle of the largestuntapped block of timberland left on the province's west coast."

I believe I said that before, to give you some explanation along those lines.

"Mr. Vesak, who came to Ocean Falls to work for Crown Zellerbach in 1954, and later left a Vancouver head officejob to go back, is convinced the provincial government got the buy of the century."

That's from the general manager of the corporation, a leading free-enterpriser.

[5:30]

"For the $1 million paid to Crown Zellerbach by the provincial government, the government received a five-storeyhotel, a wood mill, a groundwood mill, a newsprint mill, schools, apartment buildings, subdivisions, a hydro dam,commercial buildings, recreational facilities and 45 acres of townsite valued at close to $50 million."

It was valued at that in 1974. You heard the remarks from the minister across the way; obviously hedoesn't know what he's talking about.

"Vesak, who also knows the area's weaknesses and strong points, is determined to make Ocean Falls go."

At this point, Mr. Speaker, I want to just tell you a bit about Ted Vesak. He did not have to return toOcean Falls when the government bought that corporation. He did have a commitment in that community,and he knew it well. He had the confidence of the employers and residents of that community. He wasdetermined, and actually did a very good job. That operation showed a profit, as I said before, between 1972




and 1975, and, I believe -just going from memory -in 1976 they made a small profit as well. It was quitedown, but you must remember that the pulp and paper market was down in 1976 as well. But Ted Vesak dida good job, and he did have a commitment to that community. I firmly believe that if this government hadlet Mr. Vesak operate that corporation the way it should have been operated, it would be operating todayand showing a profit.

This government meddled on a sheer political, vindictive basis, and it was determined to scuttle theOcean Falls Corporation, which you're doing under this bill, and to undermine Mr. Vesak in every waypossible. You made it impossible for Mr. Vesak, the general manager and chairman of the board, to operatethat community in an effective way.

Quoting again from this article:

"It is to the chagrin of those opposing Ocean Falls that the corporation can even announce a modest profit for thelast fiscal year. 'We made a profit last year, believe it or not, but I haven't submitted the annual report to theResources minister yet.' At that time it was Mr. Williams

" 'He will have to table it first before we make public the profits of the corporation.' "

Going from memory once again, I believe the corporation made a profit that particular year, Mr.Minister, through you, Mr. Speaker, of close to $1 million.

" 'But he has announced on the radio that we have made a modest profit, and we have.' "

We're talking about 1974 now, and still quoting Mr. Vesak in this article.

"Things are starting out good this year and if things keep going as well we should do better than last year, ' Vesaksays. 'The move by the provincial government in 1972 to purchase Ocean Falls was an eleventh-hour decision.' "

And it was. I remember the time very well. I was sitting over in that comer and the then Minister ofLands and Forests was sitting back here somewhere near where the Minister of Consumer and CorporateAffairs (Hon. Mr. Hewitt) sits now. I recall that right after the election, and during the course of the firstsession of the Legislature in 1972, I approached Mr. Williams, the then Minister of Lands, Forests andResources. And he was a good one, not like the kind of thing we have now. He was a good minister, Mr.Speaker, and did his job for the people of this province during the course of those three years. The people ofthis province owe Mr. Williams a lot.

Nonetheless, I recall approaching the minister in his place and saying: "We have some 1, 500 peoplein Ocean Falls who are going to be out of work. It's an operating community. Is there anything we can doabout it?" By this time I'm sure Mr. Williams had thought of this on his own, but I asked him, because thatcommunity was in my riding, to have a look at the situation, and he did. He said sure. I recall that sometimein the spring of 1973 Mr. Williams approached me again and said he had been having discussions withCrown Zellerbach Corp., and that they were quite close to an agreement. He outlined the terms of theagreement and asked me what I thought. I said: "Well, we're getting $50 million worth of assets for $1million." You will recall that at the time Crown Zellerbach had the community up for sale for $10 million.Ten million dollars to buy a whole community. "B.C. for sale." "Ocean Falls for sale." "Town for sale." Thiswas largely advertised in the United States: "Town for sale, $10 million, " and then they listed the assets ofthat community, which I listed here a few minutes ago. Fifty million dollars worth of assets, and they wouldhave chucked everybody out on their ears. You could have bought the place for a yachting club, or



whatever.

[ Page 724 ]

Our government was successful in purchasing from Crown Zellerbach $50 million worth of assets inthat community, for about $1 million.

At that time, to get back to the article:

"Production is averaging 260 to 270 tons a day, with annual output estimated at 96, 000 to 100, 000 tons a year.Vesak says the output is a little less than half of Crown Zellerbach's Elk Falls division on Vancouver Island, whichturns out about 235, 000 tons a year.

" The three paper machines standing idle at the mill could be brought back into operation if economic circumstancesfound a demand for the specialty paper such as" - and it names the various types of wax tissues and those kinds ofproducts that we were capable of producing in Ocean Falls in 1974 and which were produced up to 1966 at OceanFalls. " 'We've cannibalized a certain amount of equipment off them, but they can be brought back' " - he's talkingabout machines now - " 'into operation for a certain amount of dollars, ' Vesak maintains."

But of course once again the minister, who's sitting in his place listening intently, was very muchaware of all this. For an expenditure of certain amounts of money, that community would be operatingtoday, and the government chose for political reasons to shut that community down and keep it shut down.

The article goes on to say:

"If Ocean Falls has a problem, it is the constant need to buy its raw materials to produce newsprint, a problem thatVesak is both aware of and concerned about."

Right. We discussed that earlier, Mr. Minister, and we understood that problem. That problem couldhave been rectified had the government decided to allocate timber that should have been allocated to theOcean Falls Corporation on the basis of the Simons report, the summary of which I have here. Thegovernment had the results of that study in their possession, and didn't in fact allocate raw materials. Up tothat time there was an agreement that had been reached with the Ocean Falls Corporation and CrownZellerbach that, when we purchased the community, Crown Zellerbach would supply the Ocean FallsCorporation with an assured supply for some years.

Then there was a period of time when much of the timber had to be purchased on the open market.This cost the operation, and gave the other companies like MacMillan Bloedel, if you will, and CrownZellerbach - I don't have to name them all, but those two companies I'm very familiar with - an edge on themarket because they had timber supply in terms of tree-farm licences. In fact, as the present Minister ofForests (Hon. Mr. Waterland) will know, they had more timber than they actually required for their needs.You will recall that the present Minister of Forests maintained and put out an edict some years ago: "Use itor lose it." I think he did take action against one company. He cut back, not on the annual allowable cut buton the tree-farm area for one large company in this province. He said they had more timber than theyrequired for their purposes, and they weren't properly utilizing that area, so he reduced their size. However,what that minister failed to do was to make available to the Ocean Falls Corporation a timber supply so thatthat community could have stayed in operation.

[Mr. Speaker in the chair.]




HON. MR. PHILLIPS: You don't know what you're talking about.

MR. LOCKSTEAD: Well, it's right here in black and white. Can't you read? Can't you think? Youropening remarks on this particular topic, Mr. Minister, were simply atrocious. What did you tell the peopleof British Columbia when you opened this debate? What did he say? He said absolutely nothing. He closedthe mill down. He's totally and personally responsible - he and his government - for arbitrarily closing thismill down in 1980. He had made a promise in writing to the people in that community in March 1980 thatthere would be a new and viable operation in that community in six months. Did he keep that promise? Andhere the minister says: "You don't know what you're talking about." If there's anybody in this House whodoesn't know what he's talking about, it's that phony minister sitting over there, in my view.

HON. MR. PHILLIPS: You were a disaster. We're still trying to dig ourselves out of three years ofsocialism. What a disaster!

MR. LOCKSTEAD: You dug yourself in. If I may point out to you, Mr. Speaker, when thosepeople over there were returned to government in 1975 there was a surplus in the budget of this province,and where are we now? Two years in a row we're . . . .

Interjection.

MR. LOCKSTEAD: More than that. That's in out-of-court settlements. I want to tell you moreabout that. Last year there was a $1.4 billion deficit, and this year a projected $1.6 billion deficit. When weleft government in 1975 there was a total deficit of some $4 billion. The deficit stands today at $14.1 billionunder the mismanagement of the people sitting over there, and he's got the nerve to say we don't know whatwe're talking about.

This is a very good article, and it relates directly to the Ocean Falls Corporation. Ted Vesak goes onto say, and I quote for Hansard:

"You see, we are not an integrated operation. We do not have any chemical pulping. We just make groundwood pulpand buy the cellulose kraft for newsprint from Elk Falls." The Ocean Falls operation consists of a wood mill, agroundwood mill and the newsprint mill, with the total townsite operation employing 400 people with an annualpayroll of some $6 million."

This was in 1974 - a payroll which contributed to the welfare of every person in this province: 400people who paid taxes and a product that brought offshore dollars to this province and to this country. Andwhat did this government do?

HON. MR. PHILLIPS: You bought all the losers.

[5:45]

MR. LOCKSTEAD: All the winners!

This article really concisely puts into words the situation at Ocean Falls as the people in BritishColumbia knew it and know it. It was actually sickening to most of us when this

[ Page 725 ]




government shut that operation down for no reason other than a political, vindictive one. We hadsaved the jobs of those people at Ocean Falls, and this government and that minister threw them out of thewindow and hung them out to dry. That’s what they did. They don't care about people. A government thatwill break its contract, a government that will break its word, a government that will take away humanrights, is a government that does not care about people. If they had any gumption they'd resign today, go tothe electorate, and ask them today in British Columbia what they think of them. They won't do that.

To get back to the bill, Mr. Speaker, and to quote Vesak:

'The market price of cellulose kraft went from $170 a ton in 1973 to $370 a ton in January of thisyear, more than a 100 percent increase, ' Vesak says."

HON. MR. PHILLIPS: Loser!

MR. LOCKSTEAD: I'll be here, mister, when you're not. I guarantee you that.

HON. MR. PHILLIPS: And you'll still be sitting in opposition too.

MR. LOCKSTEAD: Mr. Speaker, that member is still yelling. I know he's going to gerrymanderhis riding. He finds that South Peace is too much for him to handle, so he's going to gerrymander his riding,cut it in half - one MLA for every four people in South Peace, because that's about his limit. That's all thepeople he can handle. We know they're going to bring that gerrymander bill in. We know they're going tocarve up those Socred ridings into little hunks and pieces here and there. And the Attorney-General's (Hon.Mr. Smith's) riding - are you going to gerrymander Oak Bay?

HON. MR. PHILLIPS: Where I come from they eat guys like you and spit 'ern out.

MS. BROWN: No respect! He's gone three hours without a cigarette!

MR. LOCKSTEAD: Maybe I'll quit.

MS. BROWN: No!

MR. LOCKSTEAD: I mean I'll quit smoking.

MS. BROWN: Oh.

MR. LOCKSTEAD: No, I'm not going to quit this. Jeez!

He says here: "Under the terms of the agreement between Crown Zellerbach and the provincialgovernment, Crown Zellerbach agreed to supply the mill with pulp and logs until December 31, 1975.'We've got another ten months to go. It looks like we've got 1976 covered for pulp, and we're in the throesof trying to cover ourselves for logs.' "

HON. MR. PHILLIPS: You sound like an old phonograph that needs winding.

MR. LOCKSTEAD: Well, somebody wound you up this morning, you turkey.

I'm quoting from this very well-done article by Jean Sorensen in 1974, regarding Ocean Falls,



generally quoting Mr. Vesak, who was a very fine general manager of the corporation. The minister shouldlisten to this, instead of yacking and hollering. You know, it's strange to me that he gets so upset. Why is hegetting so upset, do you suppose, Mr. Speaker? Is there something . . . ? Are we hitting a nerve? He saidnothing in his opening remarks regarding Bill 30. He didn't tell us anything. He said: "We're conductingsome discussions with somebody somewhere, but we don't know who and we're not going to tell you who.We don't know what's happening in those discussions, but they're going great."

Interjection.

MR. LOCKSTEAD: He won't tell us. He won't tell us in the House. He hasn't got the nerve to standup in his place and tell us exactly what's happening. He'll sit in his seat and holler like a banshee or awounded hound-dog, but he won't stand up in his place.

To quote from this article . . . . I'm only on the the second column and it's eight columns wide. If theminister would quit interjecting, I might be able to get through the whole article. Mr. Vesak goes on to say:"I think we are going to have to apply and bid for timber the same as any other operation would." Those aregood, sound, free-enterprise practices. Isn't that right, Mr. Speaker?

Interjection.

MR. LOCKSTEAD: I know. I was in logging for some time.

HON. MR. PHILLIPS: What's the date of that article?

MR. LOCKSTEAD: You can have it. In fact, you can have the whole thing.

HON. MR. PHILLIPS: What's the date of it?

MR. LOCKSTEAD: I told you four times. If you would stop and listen instead of interjecting . . . .You have very bad manners, Mr. Minister, I have to tell you.

HON. MR. WATERLAND: On a point of order, Mr. Speaker, I understand there is a rule in theHouse that members are not supposed to read newspapers during a sitting of the Legislature.

MR. COCKE: On the same point of order, Mr. Speaker, I'm sorry for having offended the House.The next time I offend the House I hope it is the Minister of Forests who will again bring it to the attentionof the House. That makes me feel even sorrier that I've offended the rules of the House.

MR. SPEAKER: Order, please. Hon. members, on the matter of newspapers, while it has beentraditional that newspapers are not openly read, some care in reading the paper is difficult for the Chair tofind offensive - if they're not sort of held up broadly in front of the member. I think that's a rule we can allafford to live with. The point of order from the Minister of Forests is well taken.

MR. LOCKSTEAD: Can I quote from the paper? Thank you, Mr. Speaker. I'm only on the secondcolumn of this

[ Page 726 ]

article, and if the members would quit interjecting, I could . . . .




AN HON. MEMBER: And you're slow readers.

MR. LOCKSTEAD: Yes, tell me about it.

To continue on with this article: "Ocean Falls is near four public sustained yield units which haveavailable timber. They are the Kimsquit, Dean, Rivers Inlet and Chatsquot." These are public sustained yieldunits which the Minister of Forests . . . .

HON. MR. PHILLIPS: Will you quit mumbling! I can't hear what you're saying.

MR. LOCKSTEAD: Well, you haven't been listening all day. You haven't listened to anybody inthis House since I've been here in I I years. You haven't listened to anybody in this House or in thisprovince. When are you going to start listening? What I suggest that member should do, Mr. Speaker, if he'sreally interested in what I'm saying, is get somebody to read Hansard to him tomorrow morning.

To continue my quote: "There is a lot of unallocated timber in this area. In fact, it is one of the lastareas of the coast with unallocated timber. Ocean Falls will probably make application for this timber." Andthey did, Mr. Speaker. I think the present Ministry of Forests processed that application. The Minister ofForests was also Minister of Mines at the time; he had a dual portfolio, you will recall, when he was firstappointed. That member for Yale-Lillooet was probably too busy with his mining portfolio to really knowwhat was happening. In the best interests of the people of this province, he should have allocated some ofthat timber to the Ocean Falls Corporation. The minister sitting over here to my left, the Minister of SmallBusiness and Economic Development, (Hon. Mr. Phillips) should have insisted in the cabinet that thatminister allocate timber as suggested in the Simons report, which the minister has a copy of, and so has theMinister of Forests. They should have allocated timber to the Ocean Falls Corporation.

What did they allocate that timber to, Mr. Speaker? Did it go to the Ocean Falls Corporation? No.Who did it go to? I believe a large block went to Doman. Do you remember Doman? It had nothing to dowith Ocean Falls. They had their plants elsewhere. I'm not suggesting that Doman should not receive a fairallocation of timber, but in this case the forest service, the Ministry of Economic Development and theOcean Falls Corporation all had recommended that that particular area of timber be allocated to the OceanFalls Corporation, and this government did absolutely nothing about it.

HON. MR. PHILLIPS: You're just a lame-duck member.

MR. LOCKSTEAD: That's a lame-duck minister sitting over there.

I can't take much more of that minister this evening, Mr. Speaker. I've barely begun to discuss theOcean Falls situation. I have letter upon letter to read into the record, from Mr. Williston, from people inOcean Falls to the government, from the residents' council. I haven't even referred to any of this materialyet. I move adjournment of this debate until the next sitting of the House.

Motion approved.

Hon. Mr. Richmond tabled the annual report for the Ministry of Tourism for the year ended March31, 1983.

MR. NICOLSON: I move the House do now adjourn.



MR. SPEAKER: Hon. member, I can only accept that motion from the government side.

MR. NICOLSON: It Is been accepted before, Mr. Speaker.

MR. SPEAKER: This isn't one of those days, hon. member.

HON. MR. McGEER: I move that the House at its rising do stand adjourned until 2 p.m. tomorrow.

Motion approved.

HON. MR. McGEER: I move the House do now adjourn.

Motion approved.

The House adjourned at 5:56 p.m.

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Heiltsuk LT BCUC July 8-07 Ocean Falls€¦ · Heiltsuk/Shearwater Documents in Support of Motion...

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