Today in the Legislature we discussed Bill 23, The Miscellaneous Statutes Amendment Act at the committee stage. As I noted earlier, the bill contained a profoundly troubling Section 46 which granted the Minister unparalleled powers to enter into secret deals with LNG companies concerning natural gas royalty rates. At second reading I outlined my concerns in detail. Bruce Ralston, NDP MLA from Surrey-Whalley, and I supported each other, including our amendments, as we unpacked the implications of this bill. Below is the text of some of my contributions. I also provide a link to the Hansard video for Part I.
In the end both of my amendments as well as Bruce Ralston’s amendment were defeated. All members of opposition voted against section 46 as detailed below.
A. Weaver: Now, I recognize that government is rather desperate to land the $30 billion investment, and in so doing, we’re just seeing a $1 billion investment walk from Vancouver Island EDPR and TimberWest trying to put a billion-dollar wind farm investment…. Of course, government is not interested in that, because they’re desperate to fulfil this pipedream.
The concerns I have here…. I’ll ask a very direct one. In light of the fact that everything is up to the minister’s discretion, in essence, to enter into secret deals — presumably handed to him or her by a company, because this government has lost all credibility on this particular file — one of the things that they might do, for example, is work out a royalty rate that might actually be $1 billion less than it would otherwise be so that the company could then find a billion dollars to perhaps give to the First Nation to get title over their land. This is the kind of stuff that the public does not trust government on because of this legislation, where there’s nothing that precludes government working out a back deal to say: “Well done. Good for you to get your title rights recognized. Good for you to negotiate a cost. But we in the province of British Columbia will pay that cost, and we’ll pay that cost by changing this royalty rate in secrecy so that the company doesn’t actually pay it.” The province of British Columbia pays it.
My question to the minister is this, why does he need this level of secrecy, this level of secrecy here that he does not even need to give the Lieutenant-Governor-in-Council, his cabinet colleagues, notification as to what deals he is making? Does this minister honestly believe that the millions of people living in British Columbia trust him and only him to negotiate royalty rates for generations to come because somehow he knows what’s going on, and no one else does?
Hon. R. Coleman: I will walk past the ignorance of the question and just go to my answer. If the member would look and do some research with regards to the legislation, the power given to the minister to do this comes from Lieutenant-Governor-in-council, which is cabinet — the ability to do this. And if there’s any change in revenues or things that have to be adjusted on a financial basis, the minister, as I know, with regards to my service plan, my letters of expectations with my responsibility to government…. Anything that affects the government fiscally, I have to take back to Treasury Board.
I think it’s inappropriate for the member to think that it’s just the minister that’s making this decision. In addition to that, if the member would like to look at section 78.1, subsection (3), it also says that “The minister must, as soon as practicable, publish an agreement entered into under (1) but may withhold from publication anything in the agreement that could be refused to be disclosed under” — an act that governs us all — “the Freedom of Information and Protection of Privacy Act.” The only thing that would be not disclosed in that, I believe, would be if there was something that was significantly different or something that was — technology over whatever — with regards to the design of a plant or something that may have an effect on the competitive side or the marketplace before it was disclosed by the company in the appropriate manner.
If a request were made under that act, the disclosure of the agreement has to take place. It’s our full intent to make these agreements public.
A. Weaver: Well, in fact, I have read this legislation rather carefully. I’ve been following this file very carefully for the last two years. Frankly, what I’ve been saying for all that time is playing out here. Here’s another sellout.
In fact, if you read 78.1(2), it says the following: “The approval of the Lieutenant Governor in Council is not required for the minister to enter into an agreement under subsection (1)….” I don’t know what the minister doesn’t see about that, but it specifically says that “the Lieutenant Governor in Council is not required for the minister to enter into an agreement under subsection (1) (a) in the prescribed circumstances, or (b) in respect of a prescribed class of agreements.”
In essence, this is saying that the minister can essentially enter into an agreement…. The province of British Columbia, all of us, believe that we have such confidence in this minister that we are going to let him — and only him — go into an agreement with a multinational corporation. This has got to be some kind of a joke.
What is the justification that the minister needs these exclusive powers to go and enter into agreements without his cabinet colleagues knowing, without the Premier having to even know, but giving him power under section 78.1(2) to do this? What gives him the right? This is not an autocracy. Why does the minister think it is?
Hon. R. Coleman: If you read the section, it says: “in the prescribed circumstances, or (b) in respect of a prescribed class of agreements.” These are determined by Lieutenant-Governor-in-Council and allow the minister to sign them as a delegated authority to do so.
The characteristics of these agreements — in prescribed circumstances and in the class of agreements — are dealt with long before they’d ever get to an agreement with regards to what’s in them and what the minister can sign or cannot sign.
So basically, what it effectively does…. It does what most pieces of legislation do and delegates authority, after certain prescriptions and outlines have been prescribed by government, to a minister that he can execute on behalf of government.
A. Weaver: Coming back to section 46, section 78.1(2)(a) and (b) where it describes: “The approval of the Lieutenant Governor in Council is not required for the minister to enter into an agreement under subsection (1) (a) in the prescribed circumstances, or (b) in respect of a prescribed class of agreements.”
The minister recently said that the type of agreements that he or she or whoever the minister will be can enter into are controlled by cabinet. But we have no indication as to what “prescribed circumstances” are. We have no indication as to what “prescribed class of agreements” are.
It could be — and I seek confirmation from the minister — that a prescribed class of agreements could be any agreement to extract natural gas from the Montney region in British Columbia and export it anywhere in Asia. That’s one possible interpretation, and “under the prescribed circumstances,” that the minister has the time to do so. Essentially, this would grant the minister…. We have no sense of this.
Is what I just said precluded from that? What constraints are being placed on the minister to enter into these agreements without consulting, without the need for the Premier, without the need for cabinet, without the need for anyone, obviously, except the proponent to know about what the agreement is? This set of prescribed circumstances and agreements is so large and vague, it could include anything.
Hon. R. Coleman: It gives to the Lieutenant-Governor-in-Council, in prescribed circumstances or in respect of a prescribed class of agreements, to allow the minister to execute them. Those will be prescribed in regulation through Lieutenant-Governor-in-Council, not arbitrarily by the minister.
A. Weaver: I guess that’s my point. I reiterate what I said earlier. In light of the fact that this government is so desperate to sign agreements with now one company — it’s, I guess, given up on a number of others — there is a lack of trust. There’s a lack of trust that this section is not going to be anything more than “prescribed class of agreements” is with Petronus, for example, or with any company involved in the Montney play that wants to sell gas to Asia. So there is a great deal of uncertainty with this.
This amendment does simply not instill confidence in British Columbians that the government actually has any sense of direction or actual clue as to what they’re doing. They’re making it up as they go along, moving it from a generational to now, as my friend from Nanaimo–North Cowichan points out, a multigenerational sellout in a desperate attempt to try to land a company.
Let me just follow up with a direct question here. If the minister signs an agreement under subsection (2) and then after giving it to the Lieutenant-Governor-in-Council — now it’s signed — the Lieutenant-Governor-in-Council receive this, and they then determine that they don’t like it, that the minister overstepped his or her bounds, my question is: what ability does the Lieutenant-Governor-in-Council have to overturn an agreement that was signed by a minister under section 78.1(2)?
Hon. R. Coleman: I know that the NDP and the independents in this House don’t support liquefied natural gas as an industry for the future of the British Columbia. I know that. I know the member is clearly after that in his mind, and that’s fine.
But if the member will think about the legislation, it allows regulations to be developed that specify the circumstances or describe the types of agreements that the minister can enter into. Don’t get to write the agreements. The Lieutenant-Governor-in-Council actually prescribes that in regulation. And by the way, every week the decisions by the Lieutenant-Governor-in-Council on regulations are published. That information, in and around the agreements, would be published, and the minister could only execute under those terms. If he went outside those terms, because of the regulation being in place, it wouldn’t be a legally enforced agreement.
A. Weaver: With respect, this has nothing to do about being against or for natural gas. This has to do with economic folly and irresponsible promises by this government in an election campaign that they cannot fulfil. Here we see desperation in legislation. We see one after another as they so desperately try to land a single contract.
The reality is…. I’m going to read this again. I have read this legislation. It says as follows: “The approval of the Lieutenant Governor in Council is not required for the minister to enter into an agreement under subsection (1) (a) in the prescribed circumstances, or (b) in respect of a prescribed class of agreements.” It doesn’t say in respect to an agreement that has been reached and agreed to by cabinet already. It says in prescribed circumstances or a prescribed class of agreements, which is incredibly vague, no matter how you interpret that.
Again, to the minister. If he believes that these circumstances or agreements really curtail or constrain what he is able to sign, why doesn’t he tell us what they are? Why doesn’t he table here today what is actually meant by prescribed circumstances or a prescribed class of agreements? Right now it can be anything. Will the minister table examples of what these are?
Hon. R. Coleman: I’ll reiterate it. I do know the member opposite doesn’t support liquefied natural gas as a new industry for British Columbia. Even in that case, this is a piece of the legislation that allows for regulations to be developed that specify the circumstances that the minister could actually enter into and sign an agreement on behalf of the province of British Columbia.
The regulation is a law, hon. Member. The minister has to follow that law in those prescribed circumstances and in respect of the prescribed class of agreements. He has to do that, because that is defined in regulation. The regulation is developed when legislation is passed.
A. Weaver: Again, to correct the record, I have never said I am against liquefied natural gas. In fact, if you go back to estimates, you will see that I have been arguing strongly for promoting domestic sector use, including the use of liquefied natural gas in our ferry systems in British Columbia, long before the government actually came up with that direction and idea.
This is not about liquefied natural gas. This is about irresponsible economic outlook — that the government is going in with no financial underscoring. They seem to be the only ones in the world that believe this is going to play out, and they’re desperate to do so.
Coming back to the question. The reality is, as the minister would like us to believe, that somehow he’s going to be constrained in entering into these agreements, that the regulations will be developed after the fact.
There is no trust on this file anymore. So there is no trust. The government is simply not trusted to be acting in the best will of the people on this particular file. We’ve seen, time after time after time, broken promises, changing legislation. We bring in an act, an LNG act. We then completely change the LNG tax act only a few months later.
It’s for this reason that I have a second amendment that I wish to put here to actually add another check in place. This is on the order paper. It’s adding a section (8) to 78. So it’s 78.1(8), which says the following:
[SECTION 46, by adding the underlined text as shown:
(8) The Lieutenant Governor in Council may, without penalty, pull out of an agreement entered into under subsection (2) within six months of the time at which the minister provided the Lieutenant Governor in Council with the full text of the agreement.]
A. Weaver: The reason why I’m doing this is I don’t trust the minister. The opposition doesn’t trust the minister. The people of B.C. don’t trust the minister. International companies don’t trust the minister. The minister has no trust on this file.
Hon. R. Coleman: I guess he will have to understand what the law means with regards to regulation.
I should tell the member opposite that I spent eight years with the RCMP. You can’t throw an insult at me that’s going to bother me. So try as you must, it just isn’t going to work.
On the other side, the flip side, I know the member opposite doesn’t think that we have opportunities on liquefied natural gas in British Columbia. Like I said to him in debates of a while ago, I want to be invited to the dinner when he has to eat those words. It will happen in the not too distant future, I believe.
Over the next year or two, you’ll see a number of these projects go ahead. They’ll go ahead not because the international community mistrusts the minister. It’s because the minister has built a relationship with the industry across the world and with financiers to the fact that they actually believe this government will deliver on what it says it will do and, therefore, will come to B.C. and invest.
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