NRGO Committee Meeting

STANDING COMMITTEE ON NATURAL RESOURCES AND GOVERNMENT OPERATIONS

COMITÉ PERMANENT DES RESSOURCES NATURELLES ET DES OPÉRATIONS GOUVERNEMENTALES

EVIDENCE

[Recorded by Electronic Apparatus]

Friday, May 14, 1990

• 0833

[English]

The Chair (Mr. Brent St. Denis (Algoma—Manitoulin, Lib.)): Good morning, everyone. It's particularly nice to see my colleagues again this morning.

I'd like to call to order this Friday, May 14, meeting of the House of Commons Standing Committee on Natural Resources and Government Operations, as we continue a study of Canadian forest management practices as an international trade issue.

I made brief opening remarks yesterday, and I won't repeat those. I just want to say very briefly that we are trying to understand all sides of the story as it relates to the pressure not only on forest communities, forest companies, and workers in B.C., but on other parts of the country as well. There are things that are said about Canada and its forest practices on the international stage and we want to better understand what is being said and what the truth really is.

On that note, in our first one-hour session, I'd like to welcome Paul Perkins from the Council of Forest Industries and Ken Higginbotham from the Coast Forest and Lumber Association.

Colleagues, we have one-hour time slots, and I'm going to try to keep us as close to those hours as we can because many of us have flights that we have to head out for right after the last witness.

The clerk probably asked each of you gentlemen to make brief opening remarks of five or seven minutes, and then we'll have an opportunity for members to ask questions.

• 0835

Thank you for being here. I invite Mr. Perkins to start.

Mr. Higginbotham, will you start?

Mr. Kenneth O. Higginbotham (Group Vice-President, Forestry and Environment, Canfor Corporation): I drew the short straw, so I'll begin.

Thank you very much, Mr. Chairman, for the opportunity to be involved in the hearings that you're holding. We very much appreciate the federal government's interest in the situation of the forest industry in Canada, particularly relative to our role as exporter of forest products to the world.

As the chairman has indicated, my name is Ken Higginbotham. I am group vice-president of forestry and environment for the Canfor Corporation, a large forest products company headquartered here in Vancouver, with operations in B.C. and Alberta. With me is Paul Perkins, who is the vice-president of forest lands and strategic planning for Weyerhaeuser Canada. Weyerhaeuser, as you're no doubt aware, is also a large forest company with operations in B.C., Alberta, Saskatchewan, and Ontario.

As was already stated, we are here representing the Council of Forest Industries. COFI, as it's typically called here in British Columbia, represents over 100 forest companies here in British Columbia, and is also made up of six member associations, sometimes referred to as an association of associations. Those associations include the B.C. Pulp and Paper Association; the Canadian Plywood Association; the Cariboo Lumber Manufacturers' Association; the Interior Lumber Manufacturers' Association; the Northern Forest Products Association; and the Coast Forest and Lumber Association.

In particular, we have to make note of the Coast Forest and Lumber Association, which was originally scheduled to make a presentation too but has agreed to be included in this Council of Forest Industries presentation.

We are here to try to make clear to you that we recognize that many in the world marketplace are expecting assurances that the forest practices carried out to lead to forest products getting to the marketplace are done in a sustainable way. As a professional forester, I'm very happy to see that kind of assurance desired by the marketplace.

But we're also here to tell you that there is a threat to Canada's international trade in forest products from groups who sometimes misrepresent our forest practices in very real ways. Therefore, it is something that we are very concerned about. I should also hasten to indicate that I think the advances in forest practices that have occurred in Canada over the past few years are in part a result of the concerns expressed by environmental groups and, therefore, there have been some very positive influences on our industry from those groups. I think we should appreciate that, but sometimes there is also misrepresentation.

We would like to talk to you about the advances in forest practices in this province and somewhat about some proposals where we and the federal government could cooperate perhaps more fully than we have in the past.

You're already aware of the importance of the forest industry to Canada. Canada is the world's largest exporter of forest products, and the forest products industry is the largest contributor to Canada's positive trade balance. Forestry is also Canada's largest industrial employer. There are about 350 communities in this country that depend on the forest industry for their well-being. We have a very highly skilled and efficient labour force in the forest industry in this country, of which we're very proud. To support the forest industry, we have some of the best infrastructure of any place in the world. Most important to our presentation, we are a leader in sustainable development.

• 0840

In B.C., the industry is particularly significant. We make up almost half of the manufacturing shipments from this province and employ, directly and indirectly, about 300,000 people. Regardless of the numbers that are mostly spoken about these days—the number of job losses that have occurred here in the past year or so—there are still very large numbers of people and families who rely on the industry. Of those 350 communities I mentioned that are depending upon the forest industry in this country in an important way, about 100 of them are here in British Columbia.

The B.C. industry faces many challenges. We are a high-cost province. We are a province facing market difficulties, particularly as a result of the downturn in the Asian marketplace. Those things have contributed to the erosion of our ability to be competitive in the world marketplace, but our challenges don't stop there. They include the ongoing, sometimes renewed, efforts by various groups to convince consumers, retailers, and governments, particularly in Europe and the United States, that we are providing forest products that are not produced from sustainable forests and that we are ravaging the old-growth forests of the world.

In B.C., of course, the focus of those efforts is largely on the coastal temperate rain forest, which you've had a chance to experience in your visit here. We think that while there are already some efforts being focused on the boreal forest and other ecosystems in this province, these campaigns will over time broaden and become much more focused on our interior forest.

The campaigns that I've mentioned are sophisticated. They're well funded. They tend to spread falsehoods or half-truths about our forest management practices, therefore threatening thousands of jobs of Canadians and the stability of those scores of communities that we've indicated are so important. Typically, they claim that the forest industry is destroying the forest but ignore the fact that in the actual situation the land base in commercial forest is actually increasing in this country.

The threats do not stop with environmental groups. There are of course people producing products that are potential replacements for forest products. Therefore, steel, plastics, and concrete manufacturing are all industries that are attempting to capitalize on the negative light cast on the forest sector by these environmental campaigns. Those campaigns, of course, are allowing these other industries to suggest that they are more environmentally friendly than we are.

What's really happening? B.C. has a total land area of about 95 million hectares. Of that, only 24% has been designated for commercial forest use. Not all of that 24% will ever be logged. The land is managed for a multiplicity of uses and is subject to careful and publicly reviewed planning, stringent forest practices, and professionally developed forest management activities, including reforestation.

In 1992, B.C. embarked on a protected area strategy, which is well developed. Its mandate was to increase the protected parks and wilderness areas in the province from 6% to 12% of the provincial land base. We have recently passed the 11% mark. Parks and wilderness areas are being created at the rate of about 800,000 hectares per year.

For comparison's sake, the U.S. has protected about 4.7% of its land base, Australia has protected about 4.2%, and Sweden, 3.2%. When B.C.'s goal is met, we will have protected over 11 million hectares. That, of course, is about the size of the combined land area of New Brunswick and Nova Scotia.

Most of the focus of environmental campaigns with respect to the B.C. forest industry is focused upon old growth. The protected areas will protect about 3.2 million hectares of old growth when the strategy is completed. Included in that strategy is protection of the largest intact coastal temperate rain forest in the world, the Kitlope Heritage Conservancy, which was created very much with the cooperation, especially, of the West Fraser corporation.

• 0845

B.C. is very much involved in extensive land use planning. That land use planning is designed to give broad stakeholder opportunity for input into what happens in given areas. It's important to point out that frequently, at least, some of these environmental groups refuse to participate in these planning exercises, preferring apparently to do their input through the media.

In the mid-coast, which you've had a chance to look at, for example, there is a major land use planning exercise underway that you may be familiar with, where Greenpeace, as one example, has refused to become involved. Over 80% of the province is currently under approved land use plans or under land use plans that are being developed. They include large regional plans, like the Vancouver Island land use plan, and a whole raft of resource management plans being done at sub-regional levels.

The land use planning process has frequently, across the province, included first nations involvement. Oftentimes it's been suggested that they have not been involved. Of course you're already familiar with the provincial and federal government initiatives to handle land claims for the native groups that are not under treaty in this province. Many forest companies, I think it's important to point out, are actively engaged in ongoing business arrangements with first nations, and most of those lead to situations where the first nations groups have heavy involvement in the planning activities of the forest companies. We, for example, have a joint venture in two different timber supply areas in the northeastern part of the province with the West Moberly first nations.

In 1995 the Forest Practices Code of British Columbia was introduced. It's become well known for its comprehensive nature and the rigorous standards that are a part of it. The code applies to the 94% of the B.C. land base that is crown-held land. Soon, however, with the agreement of the holders of private forest land, we will see special forest practices regulation put in place for those private lands.

Forest plans under the code must be approved by professional foresters, and in this province, as is the case in a number of other provinces, professional forestry practice is governed by its own legislation. The activities of the industry with respect to the Forest Practices Code since its institution have been exemplary. Last year the compliance rate was over 94%, as determined by thousands of scheduled and unscheduled inspections made by various government agencies that have responsibilities on public land.

Keith Moore, who is the chairman of B.C.'s independent Forest Practices Board, which audits company performance under the code, and, by the way, also audits government performance under the Forest Practices Code, has stated that the board has noted that there's been a significant improvement in practices in the province compared to the early 1990s. This means there is more protection provided to streams within cutting areas, smaller cut walks, and less site disturbance associated with logging. There's better road construction and more attention to maintaining and deactivating roads after logging. The code has brought some very positive results.

This high level of forest protection, of environmental protection in the forest, costs money. The incremental costs to industry are approximately $1 billion per year. It has also impacted the availability of annual allowable harvest, reducing it somewhat. It has a revenue impact on revenues to government, and it has employment impacts on communities, but we are doing it because it is the right thing to do.

• 0850

Now I'd like to talk about what the industry is doing specifically. In addition to the things we are forced to do, as you might say, the industry is engaged in a number of activities that we've instituted, including field trips of the types you have been involved in to show customers and other interested groups our activities on the ground, where they are best able to determine the real impacts of what we do.

Many companies in British Columbia are embarked on certification programs relative to the determination that the forest practices being done there are sustainable and will be proven by independent confirmation from auditors. The industry was heavily involved in the development of the Canadian Standards Association sustainable forest management program. MacMillan Bloedel has recently been the first company to achieve certification of its north island operating area under the Canadian Standards Association standard. Three companies, including Paul's, have obtained registration for their woodlands under the ISO 14001 environmental management standard. A recent Canadian Pulp and Paper Association survey shows that by 2003, we can expect to have 60% of Canada's managed forest lands certified.

The Canadian Wood Council is also involved heavily in the development of a “Wood is Good” campaign to demonstrate commitment to sustainable forest management and to try to overcome some of the issues around replacement products for forest products. Canada, of course, particularly with federal government leadership, has been very importantly involved in the development of the commitments to development of standards under which we will be certified. The Montreal process that followed the Rio de Janeiro Earth Summit in 1992 is a good example, as is the ongoing involvement of Canada in the intergovernmental forum on forests. The Canadian Council of Forest Ministers has also been very important.

We would suggest, though, that with all of those important things the federal government has done, there may be some other things we could cooperate with you in doing.

We think that while the federal government has a long history of involvement in trade missions, the federal government may want to expand some of those relative to going with the industry to marketplaces around the world to promote Canadian forest products and to help people understand, among the customer base out there, what we're doing in the forest.

It's possible we could establish forest trade officers in important market areas, especially in the U.S. and in Europe, Japan, and so forth, to support and promote the industry.

We need to carry out ongoing training, which I know does occur, with the trade commissioners and commercial officers in various postings around the world so that they can effectively be advocates and spokespersons for the industry. We can help there.

We should expand the Canadian forestry tour program for key representatives from media, from interested stakeholder groups, and from customer groups that import our forest products. We suggest that Canadian delegates' speaking tours, for industry, labour, and community representatives to go into markets where we are important, could be carried out.

We need to also promote the certification of the Canadian forest products industry that I have referred to, by continuing efforts of the Canadian Council of Forest Ministers and people like Minister Goodale.

We would also like to suggest that the federal government continue to provide funding for the Canadian forestry service and its research efforts that are designed to improve our understanding of forest ecosystems and that then can drive ever improving forest practices in the woods.

Minister Goodale has also indicated that the government is committed to working with industry to ensure that international approaches to forest certification are equitable and don't distort trade. We are very supportive of that initiative and would encourage its continuation.

• 0855

We're also supportive of the Canadian Forest Service proposal to work to develop the concept of equivalency from one certification system to another, allowing mutual recognition of the Canadian Standards Association, for example, in Europe where perhaps another certification system might be put in place, like the pan-European system currently being developed. In other words, we don't want to see certification become a technical barrier to trade.

This concludes the formal part of our submission. I want to thank you for the opportunity to be heard, and of course both Paul and I will attempt to answer any questions you have.

The Chair: Thank you for that, and especially for the series of suggestions.

We'll start our questions with Mr. Duncan.

Mr. John Duncan (Vancouver Island North, Ref.): Thank you very much for appearing here today.

One of the statements that's often made in reference to the B.C. forest industry is the need for much more value-added production. I know there's been a lot of movement in that direction in the 1990s. I wonder if you can somehow give us an estimate of how much growth we've seen in that sector in British Columbia since, say, 1990.

Mr. Kenneth Higginbotham: I don't know a specific number. Part of the reason for that is the difficulty in defining what is value-added. We, for example, as a company have moved towards large production of what we call square-edge lumber. This is because one of our important customers, the Home Depot, wants an appearance-grade lumber, given that people come in and just buy it off the shelf. That creates a premium for us relative to commodity production of 2x4s, for example. In our view, that would be value-added.

But if you're particularly referring to secondary manufacturing, there is no question that there is a substantial increase in the use of low-grade lumber and of materials that have typically been burned or otherwise discarded in the manufacturing process to produce higher-value products. Of course, B.C. has been right at the front end of trying to produce products specifically for special marketplaces like the Japanese market.

Mr. John Duncan: Okay. I have heard estimates of up to ten times growth factor in the high end and the low end. I was trying to get a handle on whether you had any estimates like that.

Mr. Paul Perkins (Vice-President, Forestlands and Strategic Planning, Weyerhaeuser Canada Ltd.): The best estimate I could give you, and the best way of estimating it from my perspective, would be the volume of wood that we sell into what we would call a secondary manufacturing or value-added sector. In the last ten years that has grown from around 7% to over 21% of our volume in B.C. now being sold into secondary manufacturers.

Part of that has to be related to the impact of the Softwood Lumber Agreement and changes in where the product production is being taken. So it's not a clean statement in that regard.

Mr. John Duncan: Okay. I won't venture into the Softwood Lumber Agreement in this line of questioning because our committee does have terms of reference for this fall to address that as a separate issue.

Mr. Paul Perkins: We appreciate that.

Mr. John Duncan: Okay.

Now, you described some of the large set-asides in the province of British Columbia, 11 million hectares set aside and about 3.2 million hectares of old growth. It's my understanding that British Columbia is very much targeted by some of the preservation groups but that we have very significant similar situations in, let's say, southeast Alaska and other places that are not being targeted in the same way. Do you have that kind of information as well?

Mr. Kenneth Higginbotham: We certainly have wondered frequently why it is that we are targeted. There's no question that there are other places that have been targeted similarly. The Washington and Oregon coastal forest areas have been targeted by some of these preservation groups in times past, and some might suggest that it's our turn.

• 0900

I think there may also be some truth to the statement that, especially on the coastal areas of B.C., it's relatively easy with the large population to attract the attention that makes those campaigns work. The population base and therefore the media base and so forth may not be there in places like southeast Alaska. But they have also had their problems. I certainly know from talking with both elected officials and industry people in those areas that there are significant impacts on harvesting, particularly from public land, that have occurred there. We buy a fair amount of pulpwood, for example, from southeast Alaska, but it's virtually all coming from either private land or land held by first nations.

Mr. Paul Perkins: I'd add to what Ken said. Two factors, in our minds, make us a particularly attractive target. One is our landholding pattern, which is highly public, and the second is the size of the industry in this area relative to other areas, both of which make us a particularly vulnerable target.

Mr. John Duncan: Because you're smaller or because you're...

Mr. Paul Perkins: Because we're larger, and it's a more important part of our economic equation.

Mr. John Duncan: Thank you. My last question, Mr. Chair, has to do with certification. That's obviously a major topic and one we're quite interested in here. When MacMillan Bloedel announced that their north island operations had been CSA-approved, the response of one of the environmental organizations' spokesmen was to call it “greenwash”. In other words, there's a suggestion that this is the new battleground. It will be over certification.

I'm pondering what to even ask. Obviously, the number of certification programs have to somehow coalesce or there has to be some way to bring them all together. What role do you think the federal government might play, given that this is essentially a private sector exercise at this point and probably should largely remain that?

Mr. Paul Perkins: I would answer that I think the federal government has played a role in the development of providing a baseline foundation for good international standards through the Montreal process and its equivalent on the other side of the world, the Helsinki process, which provide good criteria. They are working through the model forests to help develop what are good scientific indicators to drive you towards success against those criteria. So those are important areas. We did say in our presentation that helping to push for mutual recognition was an important element of the federal government's activity.

Certification is all about credibility. As we said in our presentation, Canada is a leader in sustainable development in its truest sense. Sustainability is about balancing the tradeoffs between the economy, the environment, and social responsibility. So if Canada can lead the way in public process development through this and stand up for the right principles around certification as we look for mutual recognition of certification across the world... We recognize that we need to get some middle-of-the-road ENGOs supporting our certification proposals for it to be credible. But we cannot get ourselves into a position where to get to our customers we depend on a certification scheme that is controlled by someone who believes we should go out of business. That will not balance our economic interests.

The Chair: Thank you very much.

Joe, you're next, then Yvon.

Mr. Joe Comuzzi (Thunder Bay—Superior North, Lib.): Thank you, Mr. Chairman, and welcome, gentlemen. I appreciate your taking time this morning to come and speak to us.

Mr. Chairman, if I may, on an initial point of order, all day yesterday and throughout the process we've been hearing about the forestry technique of clear-cutting. What we've been hearing in this process is that it is, one, a very bad forestry practice, and secondly, that it is an environmentally unsound method of removing our trees, and as a result perhaps clear-cutting should be removed entirely from the forestry sector. I think it's important that we understand that through this process there are many areas in Canada fortified with very clear empirical and independent evidence that shows that controlled clear-cutting—with the operative word being “controlled”—in many areas is a very acceptable and desirable method of harvesting the forest. This is something I know now is on the record, but that in our deliberations should be borne in mind. It's very important when we talk about forestry throughout Canada.

• 0905

Having said that, the meeting I attended, and represented you in Ottawa, Mr. Chairman—and it's why I couldn't be here on Tuesday—was with our friends in the United States. I'm coming to one of the major points you said, where the Canadian government could make a substantial contribution, and it's with respect to trade, not only in the Asian market but I'm talking now particularly about trade with our most important trading partner. The ambassador said to us that where we really fail as a nation is we send trade missions all over the world, but we've never sent a trade mission to North Carolina, which is one of our largest customers in the world, and other states that use a lot of British Columbia forestry products or Alberta forestry products. Since that's such an important market, I would like to hear from you folks as to what we should do, as part of your recommendation of what the federal government should be doing with respect to increasing sales.

It's not just a matter, Mr. Chairman, of increasing sales. We never put our position forward. Why is it so important for other markets outside of Canada to use our product? As an example, if they use B.C. lumber to build a home, I think you'll find there's evidence that because of the drying process, the age of the wood, we can eliminate at least seven building days off an 1,800 square foot normal home in the United States. You never see that mentioned anywhere in any Home Depot where you sell a lot of your product. How do we get that out? This seems to me like an important message we should be delivering. We're not doing it as a country, but you're not doing it as an industry. So I'll leave it at that.

The Chair: Thank you, Joe.

Mr. Paul Perkins: I'll start on that one, Joe, if I understand the question. I think we referred to the “Wood is Good” program in our presentation. Our approach with the United States is, just as you have said, about growing demand, to the extent that the total consumption of wood needs to increase. We believe wood is an attractive building material. It's not so much a “we and they” situation as it is a wood around the world versus alternative products. Our real competitors now are the steel industry, which has targeted us, and they are using some of the material we're talking about here today very specifically in their targeted campaigns: use six used cars instead of logging an acre of forest. That, in our opinion, is not a good environmental statement. The amount of energy consumed far outweighs the benefits.

So we are trying to launch a campaign that puts the facts on the table about the value of wood in solving some of the basic human needs, particularly shelter—to your housing comment—and communication through paper. We believe the wood industry between Canada and the U.S. should deliver that message effectively. Part of our view is that the federal and provincial governments can help in the delivery of that through both the research pieces and the communication elements that go with it.

I may not have answered your question.

• 0910

Mr. Joe Comuzzi: You haven't answered my question, Mr. Perkins—it's obvious—because I didn't ask it the proper way.

The Chair: I'll give you a chance later again, Joe.

Mr. Joe Comuzzi: Thank you.

The Chair: Thank you.

Yvon, Alex, then Philip.

[Translation]

Mr. Yvon Godin (Acadie—Bathurst, NDP): Thank you, Mr. Chairman. I, too, would like to welcome the witnesses.

You were saying that 24 per cent had been set aside for commercial use. Although you talk about 24 per cent, the industry has not actually achieved that. Yesterday, Greenpeace appeared before the Committee and pointed out that the industry doesn't pays any attention to quotas and has actually exceeded the 24 per cent or the percentage allocated. I would be interested in hearing your comments in that regard.

[English]

Mr. Kenneth Higginbotham: I think my response is that I don't think the industry is going beyond areas that have been set aside by government for commercial forest activity. I do think we need to keep in mind that sometimes the environmental groups, and perhaps that's the importance of having the protected area system, have argued that the 24% is focused on the most productive land, the best soils and that kind of thing, and the areas that are not set aside for harvesting are rocks, ice, and water. There has been some truth to that, and I think that's one of the reasons where the industry has been reasonably supportive of the protected area system, to make sure all of the different kinds of areas that need to be set aside are set aside.

There's also additional land being unharvested now as a result of the standards under the Forest Practices Code as compared to the past. There are larger stream-side and lake-side buffers, for example, than have ever been the case in the past. So I'm thinking anyway that the current standards we have here, the current objectives of the Forest Practices Code, should actually satisfy the concerns of some of these environmental groups like Greenpeace better than has been the case in the past.

[Translation]

Mr. Yvon Godin: Your referred to trade missions, where the government and industry representatives travel overseas to promote industry.

Don't you think workers' representatives could also be included in these tours, as well as representatives of the First Nations? Whenever teamwork is required for international promotion or travel to other countries to do business, it would seem that only two voices are ever heard: those of the government and the companies. Since people often say the government is in bed with the companies, I don't think that's the right way to do that sort of promotion.

If you really want the promotion to be effective, don't you think all the players should be involved?

[English]

The Chair: Thank you, Yvon.

Mr. Paul Perkins: I think it's a very good idea. Some of our very successful missions have included both members of the employee group and members of first nations. I would qualify that, however, by saying the objective of the mission has to be very clear, and we do not want to export our debate to our customers' backyard. The objective of the mission should be to go out and enhance the credibility of Canada's position around this activity, not to debate it in Germany or somewhere else. So with that caveat I would say it's a good idea.

• 0915

Mr. Kenneth Higginbotham: If I could add an example of why I think it is a good idea, there is currently an effort going on between a number of forest industry companies in B.C., represented by the Council of Forest Industries, the IWA, and the Government of British Columbia, looking at the possibility of going into various marketplaces to sell B.C. forest products and to try to sell new B.C. forest products. So the concept of labour partnering with the industry is giving birth at least in B.C. at the present time.

The Chair: Thank you for that. It was a good question.

Alex, please, and then Philip.

Mr. Alex Shepherd (Durham, Lib.): I'm trying to understand the issue from the customer base, which is I guess where people are putting their finger on the button at this time. Is the issue there between old-growth versus second-growth forests, or is the issue more about forestry practices here versus forestry practices somewhere else?

Mr. Paul Perkins: On the issue at the customer level, I have to go back and say that my background is really as a 2x4 pedlar for a number of years. The big customer out there who wants to buy product really doesn't understand the issue. He just doesn't want to feel guilty about doing the wrong thing.

I think you heard yesterday about “buycott” versus boycott. To me, the result is the same. The attack line has changed because of an inability to change the public's perception of this, because the issue is too complicated. The attack has gone to our direct customers' lines, the paper manufacturers and the Home Depots of the world, and they just don't want to have traffic cut off from them. They want the problem to go away. They know it's a complicated issue and they don't want to be bothered with it.

But there is an underlying value in people's minds. They want to do the right thing. They want to sustain the world. So they don't want to feel guilty about buying something that people tell them is not good. We're facing a very strong campaign that says Canada is not credible in this area and you shouldn't do it. It's very effective because there is a core value that people want to do the right thing.

Mr. Alex Shepherd: In doing the right thing, if I'm Home Depot, or whoever, and I cut your product line, which I substituted with something else, are the forestry practices of whoever the substituted product is coming from better than ours?

Mr. Paul Perkins: Home Depot's concern is not just limited to ourselves. Home Depot's concern is limited to wood products in general.

Wood products are core products for Home Depot. They want to be able to continue to buy wood products, but they don't want to buy wood products where there's somebody picketing their gate and causing them a problem. So if ours are the targeted problem, it's not a question of whether the substitutes are better; it just gets people away from the door.

I could substitute plantation wood for natural forest wood, and that is in fact a solution. It doesn't say plantation wood is a better environmental solution than harvesting natural forest; it just solves their problem.

Mr. Alex Shepherd: An example that was given to me the other day was that some of the old-growth forest produces a certain length of fibre that is used in chemical industries, and that one of our forestry companies basically lost a contract in Europe. The question was, well, what did they substitute for it? It was a primary-growth forest from Brazil. Is that a better product? The air of this whole debate is targeted against you, but the reality is that these people are just substituting for it other products that probably may even have worse forestry practices than we do.

Mr. Kenneth Higginbotham: One of the things Paul mentioned earlier is that for whatever reason there seems to be a much easier capability to focus on old growth or forest practices issues that occur on public land as opposed to private land. A lot of the transfer, whether it's in South America or wherever else, transfers to private land kinds of situations, particularly in Europe and in North America where private land is a very strongly held concept. It's not as effective for these groups to complain about activities on those kinds of lands as it is public land.

• 0920

The Chair: Thank you, Alex.

Do you have a brief comment, Mr. Perkins?

Mr. Paul Perkins: I would add that from a competitive position, the example you used is one where I can't answer whether it's better or not. But if you go to Brazilian forests with a seven-year rotation and you're working on tree improvement, they are meeting customers' needs by changing the product to the papermakers very effectively, an option we don't have here. So we have to sell on the basis of the natural resource we have.

The Chair: Thank you.

Mr. Mayfield, please.

Mr. Philip Mayfield (Cariboo—Chilcotin, Ref.): Thank you, Mr. Chair.

I'd like to thank you gentlemen for participating in this inquiry with the committee. I have three questions, not necessarily related to one another but that occurred to me as I was listening to your presentation.

As you mention, there are about 800,000 hectares a year going into parks and protected lands. It occurs to me that perhaps we're going to see what happens to lands that are not managed. Perhaps the environmental groups will see the results of that lack of management. But I wonder if you could make a comment, perhaps not only as a representative of your company or your organization, but of yourself and your knowledgeable concern as a private person as well, about the effects of putting this amount of land steadily away into a bank that is land that is not going to be managed. Do you foresee any consequences for the citizens of British Columbia that we may not appreciate?

Mr. Kenneth Higginbotham: I think there are some positives of having significant pieces of land set aside. If we back up the setting aside with the development of research programs or monitoring programs that are designed to tell us what the natural processes are that occur in those areas that are not being directly affected by intervention by man, that may help us determine how to create proxy forest practices that are more friendly, so to speak, to those forests where we do intervene.

But the biggest concern I have as a professional forester is the fact that these relatively large areas may indeed be breeding grounds for insect infestations, disease, or fire, as the source of a place where fire may be able to start with heavy development of fuels and so forth, which will burn out of these areas into the commercial forest land base. So I think the management plans that are developed for these areas somehow have to consider those kinds of issues.

Mr. Philip Mayfield: Let me be clear that my concern is not so much that the lands are being set aside, but that the government that is setting them aside perhaps doesn't have the resources itself to manage them appropriately. Are you aware of any provision for cooperation with other interests in managing those lands?

Mr. Kenneth Higginbotham: I'm not very familiar with it. There are for certain kinds of protected areas in B.C. and Alberta, the areas where we operate, for private individuals or groups to take on stewardship responsibilities for a natural area or something like that. Typically, those are fairly extensive kinds of management—in other words, they don't require a lot of money to carry it out. There has been the point made in B.C. that while these have been set aside, the dollars for either forest protection or other kinds of planning and on-the-ground management have not been set aside. It is a concern.

Mr. Philip Mayfield: Moving on quickly to two last questions, if I could—

The Chair: Make them really short.

• 0925

Mr. Philip Mayfield: Okay. On the question of regulations and going into the new code, that's not always an even process. I'm wondering how much difficulty that evenness is in. For example, there's still some question about the appropriate size of a clear-cut, and perhaps the thinking of the regulators may be changing on that at this time.

How much difficulty is it causing for your constituents, not knowing clearly what the rules are or what the rules may be as the changes are implemented?

Mr. Paul Perkins: When the changes first come out... there's obviously a major learning process, and it does cause significant angst amongst people as they try to understand the direction.

Our answer in this area is that it is a long-term process where we're all learning about what the right values are that have to be worked. We would prefer a system that was not prescriptive regulation, but tended to be more output management results oriented. Are we achieving the goals, clarified through a fairly rigorous audit process? The aim has to be not prescription but results. Are we really getting where we want to get to around things like soil and water quality?

Mr. Philip Mayfield: One of the reasons for asking the question is whether or not there is a chance for confusion or a clear understanding between the environmental groups and the resource industry groups in the direction that these changes are going.

Mr. Kenneth Higginbotham: There's no question that there is some misunderstanding there typically amongst the environmental groups. If they were to suggest that clear-cutting was acceptable at all, smaller would always be better. Larger tends to be less expensive and less costly in terms of the number of roads and so forth that have to be developed.

In actual fact, from the point of view of really managing forests properly, we probably should have harvested areas that range in size from very small to very large, given that's the way Mother Nature has created these forest stands through fire and other ways of initiating the forests that are there.

The Chair: Thank you very much.

There is a final word for Mr. Schmidt.

Mr. Werner Schmidt (Kelowna, Ref.): Thank you very much, Mr. Chairman, and thank you, gentlemen.

I really like the candour with which you have answered some of the questions. It's just absolutely excellent to hear this.

On the other hand, I'd like to get into this area of certification just a little bit further, because it seems to me that herein lies the key to a lot of the annihilation of the opposition to the Home Depot's concerns and a whole lot of other ones.

Mr. Perkins, you said you did not want it to become a technical argument against the export of lumber and so on. I agree with that. On the other hand, I recognize, by your submission, that you omitted the reference to the Forest Stewardship Council and its attempt to provide an accreditation of forestry management and so on.

This is really a follow-up to John's question. How can we get to the point where you have a third independent group that certifies and says clearly this is a well-managed forest? That takes you off the hook; that takes all of these other competitors off the hook who say bad things about you or false things about you. Wouldn't you want to really push this hard and fast so that indeed that certification process could move ahead quickly? I feel almost as if the industry wants to slow this down, if anything, rather than speed it up.

Mr. Paul Perkins: If you've come away with that feeling, we've done a very poor job of communicating with one of our key constituencies, the government.

In our presentation we show a graph about the rate at which the industry is getting there. I do believe, however, that there is not an appreciation for how difficult certification is if it's to be done right.

The CSA process is basically an ISO-formatted approach that delivers an environmental management system. It requires a great deal of integration from the principals through to the skidder driver about what you're trying to accomplish. It is not an easy process to get that alignment and to pass an audit.

• 0930

The industry started this process in 1993. We invested some $2 million in helping the CSA... We see this as a very important tool, but we also realize that it has to be done right. For it to work over the long haul, it has to have credibility. We have to have good auditors, and this is an area where the audit field is not rich with people who have the capacity to do this. So the ultimate credibility comes in performance, and we do not want to risk our reputation on a short-term gain.

Mr. Kenneth Higginbotham: Could I comment in regard to your reference to the Forest Stewardship Council, Mr. Schmidt? There is no question that at least here in western Canada we have resisted historically the Forest Stewardship Council, largely because of the way it is made up and how that council is governed. We have come around to a belief that if that's the certification system that will have credibility around the world amongst a whole bunch of groups, including our customers, then we will attempt to go there.

In terms of your comment about moving it ahead quickly, as you're no doubt aware, we can't move as quickly as we'd like to in that regard here because we don't have the regional standards in place under the Forest Stewardship Council to know what the standards are that we're certifying against.

Mr. Werner Schmidt: I want to be clear about one thing. I'm not particularly an advocate of any one of those councils. That's not the issue here. The issue here is to find a third body somehow that will provide the certification that's necessary. Whether it's the European Council model or whether it's any of these other three models, that isn't the point as far as I'm concerned.

The point in your interest and in the government's interest is, let's be sure the product we're getting out there is certified to be coming from forests that are properly managed and that they are sustainable and that indeed we can hold our heads up and say, look, this is a good product. I think that's what we're all after. So we really need to get to the point where industry pushes this as fast and as furiously as possible, because there are other competitors, there are competing products, there are competing approaches that need to be met.

The Chair: Thank you.

Mr. Paul Perkins: We believe the third-party credibility is ultimately the major test. And we need the KPMGs, the Price Waterhouses, the S.G.s, the real independent third-party auditors who can have the bona fides to be there and who have quality people behind them.

Mr. Werner Schmidt: Thank you.

The Chair: Thank you very much. I'd like to thank our two witnesses on behalf of the Council of Forest Industries.

We will take a two-minute break while we invite the IWA delegation to the table.

• 0934

• 0936

The Chair: I would like to invite members back to the table.

We have some airplane schedules to meet this afternoon, so we're going to try to keep everybody on schedule. I appreciate the cooperation we've had so far from witnesses and from members. While we're waiting for the members at the back, I'd like to thank you for taking the time to come out this morning. Which of you gentlemen will be making the lead presentation?

I just wanted to know if it is you, yourself, Mr. Smith, who's making the presentation? Okay.

The clerk probably mentioned that we like opening remarks of five to ten minutes, giving members lots of opportunity to ask questions. So with that, Mr. Smith, we invite you to commence.

Mr. Terry Smith (Secretary Treasurer, Industrial, Wood & Allied Workers of Canada): First of all, thank you, Mr. Chairman.

I just want to introduce the folks with us. Darol Smith is from Local 2171. Kim Pollack works out of our office, and he has done a lot of work on various issues. He will be summarizing our briefs for us. Darrel Wong is the president of Local 2171, which is the local union that covers the mid-coast and Vancouver Island, etc.

With that introduction, I'm going to ask Kim to do a summary of the presentations we have made. Unfortunately, due to other commitments and so on, a number of people could not be here this morning, and I apologize for their not being here.

The Chair: I'm sure your delegation will be more than capable of handling it.

Kim.

Mr. Terry Smith: We'll do our best, Mr. Chairman.

Mr. Kim Pollack (Director, Environment & Public Policy, Industrial, Wood & Allied Workers of Canada): Thank you. I think I've met most of you at various times.

I have worked now for over six years on environmental issues here in British Columbia and nationally.

As you're probably aware, IWA is a member of the Forest Sector Advisory Council, a federal advisory body that advises Ministers Goodale and Manley on forestry issues.

We've been very active on the consultation around proposed endangered species legislation, both Bill C-65 and the new legislation that's expected. We've been very active, of course, on a whole number of environmental issues here in British Columbia.

So we're certainly no strangers to these issues. Sometimes we wish they'd go away, but we know they won't and so we're there.

This morning we're here to help you, hopefully, in your deliberations on this issue around the forest practices in British Columbia and Canada and the need to market our forest products.

As you've seen in your visit here to British Columbia, the forest industry operates over a vast area in British Columbia. We operate in a whole variety of different settings and situations. Some of those are relatively uncontroversial and some of them have plunged us into controversy. So we need to put into perspective, just for a start, the incredible vastness of the area we're operating in and the number of different situations our members find themselves working in.

• 0940

It's really important to focus on our members because these are people, when you talk about IWA members and other forest workers, who make up 100,000 jobs in British Columbia—100,000 families who make their living through the forests. Some 100 communities are dependent on the forest industry.

You've met some of those folks first-hand and you know how committed they are to making a sustainable forest industry work and seeing their way through the huge transitions that are going on in the forest industry today in this region. Some of that means learning new ways of operating on the land, which our members have done.

We undertook, for instance, a huge training program to implement the Forest Practices Code in the mid-1990s. Some of that means engaging in land use planning exercises, and certainly those haven't been any fun. I am a veteran of three Commission on Resources and Environment processes, as well as the lower mainland protected areas plan. I think pretty well everyone of any rank and stature in our union has sat at one of those land use negotiating tables some time in the last half-dozen years or so. We know that's part of the price of making the transition to a sustainable forest industry.

We have been willing to support and encourage the change that's gone on in the forest industry over the last period of years. We supported the Forest Practices Code when it was implemented. We supported the protected areas strategy, the timber supply reviews, the land use planning processes, and so on. That's come at the cost of a considerable amount of pain, dislocation, unease, and even job loss for our members. So this has been no picnic.

In a very large way, we are the people who have carried the can for the change that has gone on. We're the people who have put our lives, jobs, families, and communities at risk, not because we want to see that happen but because we know that's the only way forward. So in spite of a lot of pain, dislocation, and trepidation, we've seen this thing through. I guess today we're here because we need a little bit of help, and we think the federal government can deliver some of that help.

We need help to ensure we can get to international markets. We need help to deal with boycotts, which has been an issue of discussion through the couple of days you've been hearing testimony, but we also need help in terms of market development. We need help in terms of the strategic analysis of both existing and potential markets. We need help in terms of developing new technology and processes and the training that goes with that.

We need help in securing and protecting our existing markets, for example, with respect to the pine nematode regulations in Europe, building standards and so on in Japan, and—this is a really serious and important one—the Softwood Lumber Agreement with the United States. That is a realm, as you're well aware, that's an exclusive and key federal jurisdiction, and this industry needs that kind of help from the federal government.

• 0945

If members of Parliament can carry a message back to Ottawa and the government, it's that we really seriously need a concerted program of action in terms of developing and enhancing trade in forest products in this country. As I said, a boycott is just one of those issues, but it really is a serious one.

We're doing our best, as other witnesses have suggested, to deal with the issue of forest certification. IWA Canada has long been a member of the Canadian Standards Association process. We've recently entered into a dialogue as well with the Forest Stewardship Council. So we're prepared to go down that road in terms of what needs to be done in the area of forest certification.

But we also need help in terms of securing markets, developing new products, and developing new technology, and the training that goes along with those things. So if I've left you with any message at all today, I hope it's that it's an important area for the federal government to be looking at. We need help, as the people who work in the forests, Canada's largest source of export earnings and employment.

Thanks.

The Chair: Thank you, Mr. Pollock.

We'll start with John Duncan, then go over to Alex.

Mr. John Duncan: Thank you very much.

I've had a lot of letters from IWA members lately on the rougher-headed lumber issue, and I'm very pleased to hear that the U.S. has deferred any decision on that until the fall. That's the latest information I've heard, which is very good news indeed.

I'd like to credit the IWA with the fact the committee is here today. The members from Local 2171 came to Ottawa and got this committee motivated. So I think it would be inappropriate to go unsaid that the committee has had a very good visit. Most of the members of this committee are not from British Columbia, and there will be a strong interest in coming back to British Columbia on other forestry issues. That makes my job easier. There are three MPs in a row here that are from British Columbia, and that makes our job easier.

The IWA has played a very strong role in land use planning in the province, and we recognize that. Two jurisdictions we've been to this week are the Cariboo-Chilcotin and the mid-coast. So that ties in with really why we're here.

A statement was made by one of the previous witnesses, I believe it was Paul Perkins, in reference to stewardship standards. He said—I don't think I'm putting words in his mouth—something along the lines that the standards should not be set by people who want to put them out of business.

Now I'm going to compare that to the issue of Greenpeace participating in the mid-coast land use planning process. They were not involved in the Cariboo-Chilcotin process. There was a consensus resolution to the Cariboo-Chilcotin land use process. Now there's been a great deal of energy expended to involve Greenpeace in the mid-coast, but they have a different mandate. Where do you foresee that going? It's a tough question, I know.

• 0950

Mr. Kim Pollack: It's always a tough road between whether it's better to have those folks inside the tent or outside throwing rocks. I have worked on land use planning processes under both conditions. I believe it's possible to come to a resolution with the greens involved. Certainly we came to a consensus resolution on the lower mainland protected areas plan. Some green groups were involved; some weren't involved.

I think it makes the dynamic more difficult, but ultimately you get a better product if they're involved than if they're not involved. I was going to ask Darrel Wong to comment on that because the mid-coast actually falls within his local.

Mr. Darrel Wong (President, IWA Local 2171, Industrial, Wood & Allied Workers of Canada): I have two comments. First of all, if people from Greenpeace and Sierra Legal Defence come to the table and from the beginning of the process say there is no possibility of ever negotiating a resolution to the situation, in my mind, they are not really coming to negotiate. If you're going to sit down to try to find a resolution, you don't start out by saying it can't be accomplished. So I have some real difficulties with that type of mandate from an organization coming in to sit on land use planning.

My other comment is that our intent here today was to try to have a national perspective, a provincial perspective, and then a local union perspective. Both Darrel and Darol have prepared some additional comments, and with the indulgence of the chair, we'd like to have the opportunity to put those forward.

The Chair: Go ahead now. How many minutes, roughly, do you need? Just so we make sure we have...

Mr. Darrel Wong: It shouldn't be any more than a maximum, between the two of us, of about five minutes.

The Chair: Please, go ahead.

Mr. Darrel Wong: Thank you very much. First of all, I want to thank each and every one of you for making the long trip out here to British Columbia and for taking time out of your exceptionally busy schedules to take a look at what the members of my local union do for a living.

In the time you've been out here, I think you've covered an enormous amount of ground, and you've seen that in fact the forest does grow back. You've seen that in areas where we logged 60 to 80 years ago the trees are now 30 to 32 inches across and standing well in excess of 100 feet tall. In my mind, that dispels the rumour that forestry is not something that will continue. It has the potential to continue in the province of British Columbia forever, in my opinion.

From the perspective of the members from my local union, and I'm sure from a large number of local unions across Canada, we enjoy working in the forest. We do a good job in the forest. We're extremely pleased that the changes that have taken place over the last 10 years are creating the ability for us to go to the public arena, on both a national and an international basis, and say, come and look at what we do, because we do it exceptionally well. We do it properly environmentally, and we are protecting all of the species in the forest.

We are concerned and have difficulty with the fact that there is absolutely no recognition for the changes that have taken place. We are at this point being targeted by some radical environmental groups saying, on an international basis, we should not be able to sell our products. That is putting a significant number of members of my local union out of work, as well as other workers within this province, and I'm sure it's having an impact across Canada. It's not true that we are not doing a good job. You've seen it for yourself.

• 0955

I want to close by saying thank you very much. I think you will now be able to tell people that you've seen it yourself; the proof is there. We invite each and every one to come back to look at it again. If you know of other groups or organizations that are interested, we'd certainly like to work on having them come out, to dispel the untruths that are being told about our industry.

Thanks.

The Chair: Mr. Smith.

Mr. Darol Smith (Executive Board Member, IWA Local 2171, Industrial, Wood & Allied Workers of Canada): Good morning, Mr. Chair. I'm Darol Smith. I'm an Interfor employee and the mid-coast executive board member for IWA Canada Local 2171.

Six generations of my family have earned their living harvesting Canada's timber. I'm proud to say that my son works as a mid-coast forest worker. Our family has always practised sustainable forestry, and our original family homestead, a few kilometres outside Campbellton, New Brunswick, still produces an income from forestry for my relatives.

I'd like to take this opportunity to thank all the members of Parliament and the standing committee for taking the time to travel out to B.C. and tour the mid-coast.

We agree with the Honourable Ralph Goodale, Minister of Natural Resources, when he stated in the House of Commons that Canada has the best forest practices of the world. We agree with that. But on the other hand, Greenpeace is telling the world:

The Great Bear rainforest enjoys only weak environmental protection from Canada's government and is being systematically logged to the bare earth.

Everybody in this room knows that's a lie from Greenpeace. What we don't know is how much potential market share we're losing as a result of these false statements. We must do more to dispel these destructive misinformation campaigns about Canada's forest practices.

British Columbia's forest practices are governed by legislation and regulations that are among the most rigorous and comprehensive in the world. Forest workers practise world-class forestry every day on the job. You saw it with your own eyes.

Forest workers and their families and the communities where they live are under attack. Radical preservationist groups are killing jobs in B.C. Forest workers must be given the opportunity to be part of the solution in this very serious issue. We need to be a player, using a Team Canada concept.

We appreciate the efforts of the government-sponsored tour to deal with the international misinformation and boycott campaigns, but we believe there is a key element missing in Canada's marketing strategy: the worker. We've noticed that during the forestry tours, most of the touring visitors seem to gravitate toward the worker. Apparently they think we have a story to tell.

In conclusion, I would like to request that the parliamentary standing committee recommend in their report to the House of Commons that workers from the mid-coast be asked to join Canada's trade missions and speaking tours.

Thank you very much.

The Chair: Thank you, Mr. Wong and Mr. Smith. We're going to try to move along with the questions.

We're going to go to Alex, and we'll try to get you back in there, John.

Mr. Alex Shepherd: The more we get into this issue, it strikes me that this is all about messages, how you get your message out to the public. It's pretty easy to show a tree that has been cut. That's supposedly a negative message. How can you people be more effective with your message?

I've talked to loggers in the woods and to people who have lost considerable time and wages and about the impact that had on their families. I don't know if we can have sort of a holistic approach. For instance, it would be nice to say that every time one of these ads goes into the newspaper, so many communities in British Columbia are negatively affected, that so many people lose their jobs, that communities will see their resources extracted from them and possibly even fail.

How do we get that word across? How do we make it simple so that people will understand that every time somebody does one of these negative actions... I think you talked about a class action suit dealing with down time in a legal action that was taken.

• 1000

How do we get those messages out?

Mr. Kim Pollack: One of the things we've handed out to the committee is IWA Canada's national forest policy. It's this nice-looking document here. One of the main themes in it is that it's about balance, that we need to protect the environment and we need to preserve the biophysical nature and values that we find in the forest, but we also need to create jobs. So it's about jobs and families and communities and people, as well as about making a living from the land.

When people get that perspective on it, it's a lot easier for them to see that it's not an either/or situation and that nobody can make a living from the land with zero impact. It's more a question of making sure our impact is minimal and doing what we need to do to restore ecosystems and to preserve some ecosystems at the same time as hundreds of thousands of people in this country make their living. We get our largest source of export earning from the forests. We don't have to choose; we don't have to make a false choice between environmental protection and that major mass of industry that's the backbone of some 300 communities in this country.

Mr. Alex Shepherd: What I'm addressing is not so much within the domestic economy—I think people here in British Columbia can understand how it's having a negative impact—but out in the international forum, where obviously all the action is.

For instance, if I ran a Home Depot, all the message I'd ever get is that we're cutting old-growth forests in British Columbia and it's a bad thing. That's the one message they have. If the consumers had the second message, that not only do we have good forestry practices, but every time you make these decisions you are crippling communities here in British Columbia... That's the message you want to get out.

Mr. Kim Pollack: Before I hand it over to Darrel Wong, who also wants to reply, I would say one of the keys here—and I think Darol Smith put his finger on it a minute ago—is that whenever international groups that include workers and first nations go outside this country, it's the workers and the first nations that seem to resonate the most, particularly with Europeans but also with people outside of Canada. It's really important to put that human face on the situation. Here are the folks—and they are right here today—who bear the brunt of this stuff and are going to carry the can.

Mr. Darrel Wong: There are two points I'd like to raise with regard to your question. First, Canada already does a fair amount of work on advertising around the world through some of its embassies. The down side is that I don't think the majority of the embassy people around the world have an understanding of what really takes place with forestry, and in particular with B.C. forest products. So while you actually have a very good structure available on an international stage, you don't really have people with the knowledge of our industry. If we somehow had the opportunity to be able to provide that knowledge to those embassies, and those in turn were able to utilize the information they've gained, that may assist us in some of the areas around the world, as well as other marketing strategies that I think we may be able to come up with collectively in order to be able to deal with some of these issues.

• 1005

The second point you raised was that we have started a legal action. In fact, we did start a legal action over a year ago, closer to two years ago, because Greenpeace and Forest Action Network actually blockaded our membership on Roderick Island for about 10 days and on King Island for almost 20 days. It cost our membership $170,000 in wages and fringe benefits, and they in fact had not worked, most of them, for a significant length of time and had just returned to work. We went to court here in British Columbia against Greenpeace last April, a year ago in April, and Greenpeace was successful in convincing the judge that what we in fact now need to do is go to a full trial in order to be able to get our members' wages and benefits paid. So we intend to do that.

The difficulty is that where we should have 7,000 members working, in February we had 3,000 members working, and we don't have the resources to be able to continue with the legal action that's necessary to get Greenpeace to pay the members' lost wages and benefits that they took away from them. So we're still planning on following through with that. It's an indication, really, of what commitment Greenpeace has to workers.

The Chair: Thank you, Alex. We'll try to come back to that point, but I want to try to make sure every member gets a chance.

Yvon, please.

[Translation]

Mr. Yvon Godin: First of all, I'd like to welcome you to the Committee this morning. I think that what you have done is important. As my colleague John Duncan pointed out earlier, you came to Ottawa and your visit may well have triggered our trip here to B.C., as well as the meetings held in my office and in other M.P.s' offices. What is also important is that we had an opportunity to visit the sites and see for ourselves the kind of work that has been done.

I also want to thank you for the book you gave us yesterday. Last evening and again this morning, I took the time to look at it, particularly the examples going back to 1978 and 1994, or 1950, 1995 or 1998. It shows the effort that has been made by industry. One thing I can say, though, is that despite the problems you're having, I'm a bit jealous of the forest industry. Unlike a mine, a tree can be replaced. It's important to recognize that.

You have made one request in particular: that if we go abroad to promote the industry, that you be part and parcel of that process. You say that you have a story to tell about people who work in the industry. You also say that you are in a position to represent the workers anywhere in the world, if the government and industry go abroad to promote our products or our practices.

I was a little bit disappointed this morning by some of the testimony we heard. One group in particular seemed rather pessimistic. They said they don't want us to wash our dirty linen anywhere else. To me, it seemed to demonstrate a lack of trust.

[English]

When I did raise the question, he said he didn't really mind it, but he didn't want to go to another place to wash our dirty laundry. I think as Canadians, as working people, people could wash their laundry here. When they go there, they go for the same goal—to try to promote the industry. But I just want to hear how important it is.

As I said, I would like to ask many questions, but we're limited by time. But this one I think is the most important one because that's why we're here—to listen to you people, listen to the industry, listen to the workers' representatives, representatives from all groups, whether it's Greenpeace or environmental... and then after that make up our mind and come out with a report.

But I really feel, how could we go out there and sell it to other countries, that they appreciate what we do and they believe in us? It seems they don't believe in us. I want to hear more about how important it is in all these processes.

• 1010

The Chair: Thank you, Yvon.

Ms. Kim Pollack: Yvon, I don't think we have any dirty laundry. You've seen it on the ground. You've seen how the forest regenerates. You've seen the way our folks work in the woods and the pride and the care they take in doing a good job. We don't have dirty laundry. We've got a great story to tell. We are probably the greatest forestry nation in the world.

We've made dramatic changes in the light of new information in the way we work in the woods. We support thousands of people here in British Columbia—over 300,000 people directly, and hundreds and hundreds of thousands more indirectly. We earn our living through the forest industry, and we're proud as hell of what we're doing. There is no dirty laundry. We're doing a really good job, and we should be out there telling the world about it. If we've got a few Canadians who don't like, for whatever reason, the way we do it, we're prepared to sit down with them too and try to explain it and try to reason with them, and try to be rational with them. If we can't, then we're sorry, but we don't have anything to hide. We've got a great story to tell.

Mr. Yvon Godin: Just to clarify, the reason I said that is the previous witnesses said they don't mind bringing people with us as long as we don't go there to wash our dirty laundry. That's the only reason I made that statement.

Leaving aside the dirty laundry, because I don't think there will be a place if there's anything you have to do... and I think that's the controversy you have here. Do you feel it will be important for the industry if all partners are together? I think that's the whole point of it, that if you only hear from the companies that want to make money—that's how we've seen it, and as I said this morning to the previous witnesses, the government has seen it as well; they would very much like to support the industry, and the other ones that are involved in it, the working people, the representatives of the working people, are not part of it. Are we not missing a link in the chain, and when is that getting done?

Mr. Terry Smith: Absolutely. Just as a quick response, I think you're right. From the federal government down to the worker and beyond, if we are all on the same wavelength and we have good world-class forestry practices, I don't think it's a question of washing your dirty laundry out there. It's to tell people that in this country we're not some kind of savages that go out and massacre the land and do things wrong, and we are very heavily regulated to ensure that doesn't happen.

However, you've got people on the other side of the equation that take the position that no trees should be cut in this country, period. It just goes from one area to another. The problem is—I think it was mentioned earlier—the customer out there who buys the forest products in this country doesn't like somebody walking up and down in front of the shop raising hell about it, and the issue is to make sure that in that country, or wherever that is, we can make our case. I believe we can make our case easily.

The fact of the matter is, workers seem to have a different effect than, say, a politician when you go to a country. In lots of cases they think the worker is out there on the stump and he sees it. We've brought people from all over the world and toured them out here and they said, “God, that isn't what we're being told at home. It's a lot different.” Our problem is there aren't enough of them coming over here to have a look at it, and that's right across the country.

The Chair: Thank you, Mr. Smith. It's a good line of questioning.

Werner, please.

Mr. Werner Schmidt: Thank you very much, gentlemen, for appearing here this morning.

Terry, the comment you just made leads right smack dab into the question I was going to ask. In fact, I want to refer to the presentation that was made to this committee by Dave Haggard, the president. He makes this comment. He says our ultimate goal is

to produce useful products for humanity while ensuring the long-term sustainability of forests and providing safe, secure opportunities in the forest sector for current and future generations.

Now, that's your official position as a group. The one thing that has impressed me throughout... well, there were three things primarily that impressed me. The first is the courage it took in appearing in Ottawa in the first place. I want to pay special attention to two fellows who are sitting at the end of the table, Darol Smith and Darrel Wong. I think you made quite an impression when you walked up and down the hill to the various offices. You did not play a partisan politics situation; you talked to everybody. I think it was good.

The second thing that impressed me is the pride that you have, and the pride the workers have in the work they're doing in the forest service, generally speaking.

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The third thing that impressed me is the fact that you can actually sit in the same room with the industry people with whom the unions apparently always fight and you're able to work together. Under the alliance of forest industries, the same thing is happening. In fact, I think you gave us the book yesterday on behalf of the alliance.

This suggests to me there's a coalescence here of approach. This statement by Dave Haggard, your president, advocates that as well.

The question I have is, how can this union, if you will, of the industry, of government, and of the workers really come together? You've tried, and it seems to me I still detect a certain degree of friction and mistrust in this thing. How can we build a trust relationship so that in fact we can go out there feeling confident that when you're out there you will tell the same story you're telling us here as a committee today?

Mr. Darrel Wong: I'd like to start that off.

The IWA and the forest industry are married together; I think that's probably the easiest way to define the relationship we have. What that means is that we have no intention of separating. We have at the end of the day some very similar goals. The goal from the IWA's perspective is the maximizing of employment in the safest possible manner that's available to be able to work. I think from the industry's perspective, they need to maximize their opportunity for fibre. Those two can go hand in hand very well.

But in any marriage, there are always going to be disputes. We don't always agree on every issue. That's a positive relationship, in my mind. If one blindly follows the other, I think that creates more of a problem than a benefit. But in this area we are both very confident. From what I have seen in the work I have done with the companies within my local union, and certainly in dealing with the Forest Alliance, we are very similar in this goal.

We have done an extremely good job of changing forest practices. We are doing an extremely good job on the ground. Our membership understands the changes that have taken place. They support the changes that have taken place, and they're doing it. The forest companies are supporting our members in doing that job properly.

We have the ability at any time to say we refuse to do a job because we don't think it's environmentally proper. That's something that is recognized with the industry and with the IWA. We haven't had a problem in those areas. There's a tremendous amount of cooperation in that area. But that doesn't mean that outside of that area we can't have disagreements. Employers still have different opinions on different issues, as do we. In this area I think we're very similar.

The Chair: Are there any other comments?

Mr. Kim Pollack: If I could just add to that, ultimately when it comes down to it, we are workers and IWA is a union. They are companies. We have different interests, but that doesn't preclude, as long as we recognize the reality and the salience of those different interests, that on various issues we can cooperate and work together.

Just as an example, lots of companies have joint environmental or joint safety committees that work together, because good environmental practices and good health and safety practices are of mutual interest to the workers and to the company. That doesn't mean that one day we're not going to go to the bargaining table and have a dispute and we'll be on strike. But ultimately there are all kinds of areas in which, as long as you respect one another's jurisdiction and interests, you can work together.

The Chair: Werner.

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Mr. Werner Schmidt: The only comment I'd make is that as long as it doesn't become an element that creates the distrust we were talking about, because I think that's absolutely critical.

I think a point that was made earlier was you didn't want a certification procedure somehow to become a technical handicap to international trade. I think it's the same thing here, that where there is legitimate disagreement—and I'm sure it happens and it's not a problem, but that it be managed in such a way that the trust relationship isn't destroyed. I think that's the point I'm trying to make.

The Chair: Thank you, Werner.

A short question to Phil, and then Joe has given up his time so John can finish off. So, Phil, please go ahead.

Mr. Philip Mayfield: Thank you very much. I appreciate that.

Mr. Joe Comuzzi: Thank me for that.

Mr. Philip Mayfield: Mr. Chairman, I'd like to begin by saying that as we were touring the mid-coast, I was particularly pleased, in looking back, that both Darol Smith and Darrel Wong were in the aircraft I was in. I appreciated very much your knowledge, your intense interest, and your pride in what you are doing there. It was a great experience for me to be there, and I'm glad to be here at the table with you again this morning.

As your presentation was being made, I noted about six things that you suggested the federal government might perhaps think about in advancing the industry. I could go through the six—there may have been more, but I've made note of six. The question I want to ask is, simply, could you please go beyond just the points? I won't ask another question, but I'd like you to elaborate on how you see the IWA, from your perspective, participating in helping to get at international markets, helping with boycotts. You've touched on some of these things by saying that the workers perhaps do a better job than the politicians, as do the native Indian people, and they are perhaps more acceptable than other people in explaining because they're the men and women on the front line of this.

Perhaps you could take those points and expand on them from your particular point of view, as to how you see the federal government doing that from your perspective and how perhaps you might be involved in that. I think you do have a role to play here.

Mr. Kim Pollack: Thanks for that. We actually have made a proposal to the federal government for a multifaceted approach to marketing and market development, market enhancement, product development, and so on. On this proposal I've actually handed out a copy of a document called “Managing Canada's Forest Products: A Proposal from IWA Canada”, and that gives you some idea of some of the—

The Chair: It's “Marketing of Canada's Forest Products”, I think.

Mr. Kim Pollack: Yes. That gives you some idea of what IWA Canada has in mind. In terms of IWA's own involvement in that process, I think it's really important, as we've said here today, that Canada and British Columbia should be using the contacts we have, in various countries in the world, with other groups of workers and their related organizations.

Just as an example, we're a member of an organization called the International Building and Wood Workers Federation, which brings together trade unions from over 100 countries that are related in the construction trades and the forest sector. It's a hugely powerful and influential body, and through that we've made contacts with workers in Europe, in Asia, in other parts of North America and Latin America, and in Africa. We are constantly expanding the contacts we make through that—for instance, with workers in Germany, who we learn are having the same kinds of problems with groups like Greenpeace that we're having here in Canada. We've begun sharing information with our brothers and sisters in Germany and Scandinavia on issues like forest certification, for instance. We have quite an array of contacts, which people generally don't know an awful lot about, which allow us to get at unions, governments, political parties, and so on, to those who are important and influential decision-makers all around the world.

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The Chair: Thank you very much.

The last word is to John.

Mr. John Duncan: Thank you very much. It's a pleasure to be given that special role.

There's the second question I never got to ask on the first round, and that is related to the question Yvon was asking. I know one of the major directions you're promoting is that there be worker involvement in going into our markets, and my feeling is that you have a very strong role to play there, and that the rural and aboriginal community leadership does as well. Our committee and, in earlier visits, some of the other MPs' tours heard from those people and were very impressed.

There was a statement made this morning that the caveat on doing this is to ensure we do not export the debate or argument overseas, and I think we have to pay attention to that.

So my question is, how confident are you as a group in stating that it would be a very reasonable proposition to put together a group representing those three various categories—labour, rural, and aboriginal communities—that would be all on the same stage in terms of promoting Canadian interests?

Mr. Darrel Wong: I'd like to start off with that one. I think right here, right now, is probably a shining example of that. We went to Ottawa last June and spoke to a number of people in Ottawa. What they said to us was we had a fairly good story but we should come back with more partners in order to be able to spread that story and gather a larger group of support. We went back in November and spoke to people from all parties in Ottawa, and all of the parties, in my opinion, dealt with us very fairly and gave us a reasonable period of time in order to allow us to address our concerns. That was a joint trip between the IWA and the industry.

We are now here today extremely delighted in celebrating your coming all the way from Ottawa to listen not only to the IWA and to the industry but to other stakeholders on the issues of the day. I think this really is a shining example of how our ability to work together has created at least the beginning—and I believe, quite frankly, from my perspective, that this is the beginning—of the next process in order to be able to expand. So I think the example is right here today that we can work together.

Mr. John Duncan: Thank you. I'm going to change the subject and talk about this proposal from IWA Canada regarding marketing Canada's forest products. A big part of the document deals with the issue of British Columbia hemlock exports to Japan, which is a very big piece of our market. I'd like to focus some attention on this proposal because it is so significant in terms of our exports. I'll just highlight a couple of things for the committee members here.

• 1030

Between 1987 and 1996, B.C. lumber exports to Japan went from 1.3 billion board feet to 2.6 billion; they doubled. From 1996 to mid-1998, we lost all we'd gained. They plunged by 1.2 billion board feet. A big part of this has to do with coastal hemlock shipments. It has led to the development of a partnership known as the Zairai lumber partnership. I'm very pleased to see the IWA is endorsing this project and requesting attention from the federal government on this.

So I bring that to the committee's attention. Could you let the committee know what activities have happened, as far as you know, in terms of enlisting the federal government in terms of support for this proposal? I know there's a definite request for money, and I'm not sure how much money is involved, but I know it's an important project.

The Chair: Thank you, John.

Mr. Terry Smith: We have endorsed the program. I've spent considerable time working on the program. It's a lot of research and development and marketing of this particular type of technology. We fully endorse it. From our point of view, it's where we think this industry has to get to do more remanufacturing in this country and ship out a different product, more to where the customer at the final-use end is. So we're quite supportive of that.

The Asian market has dropped considerably. It's coming back slowly, but it's coming back. This is an area of technology and manufacturing technology that's new and innovative and could have good results.

Again, we're saying we endorse a lot of good ideas, because we have our members living and working in a lot of those 300 communities that constantly get mentioned. They have their families, their homes, and their roots in those communities, and it's not easy to pack up from those small communities and move on. Whether it's mining or forestry, those are the people. Vancouver isn't going to be affected if some town in northern British Columbia closes up and disappears.

So you have to be supportive, and I've endorsed and worked with them on the program.

The Chair: Thank you very much. I'm sure we could go on with many more questions, but what I think we can assume is that a dialogue will continue into the future.

I'd like to second those comments made by others that we owe a debt of gratitude to the Local 2171 in particular, and John Duncan as well working with them, to bring to our attention in a forceful way the importance of this issue to your members, and to the communities in the mid-coast in particular. What you've possibly allowed us to do is to maybe stem the tide here and the possible negative impact of, shall we say, the unfair commentary on what's happening in B.C. affecting other parts of the country, where in due course there may be problems as well. So we appreciate that.

With that, we'll thank you and invite our next witnesses to come to the table. We'll start in about one minute.

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• 1037

The Chair: I'd like to reconvene our morning session.

We're pleased to have as our witnesses in this next hour the Forest Alliance of British Columbia, the Association of British Columbia Professional Foresters, and the Forest Practices Board.

We have been trying to get as much input as we can yesterday and today, so we're grouping witnesses. We're pleased you could be here. In the order in which you're listed, starting with the Forest Alliance, we invite you to make some opening remarks. Try to keep them to five, six or seven minutes if you can, please, thereby allowing time for questions. We have some airplane commitments that we have to meet.

Do I take it that Patrick Moore will start for the Forest Alliance?

Please, Mr. Moore.

Mr. Patrick Moore (Chair, Sustainable Forestry Committee, Forest Alliance of British Columbia): Mr. Chairman and honourable members, thank you very much for the opportunity to present to you today. I'm sorry I wasn't able to join your tour of the north. I know what a fabulous sight it is to fly over the mountains of the coast and see the tremendous forests there. My colleague, Tom Tevlin, of the Forest Alliance, tells me that you had a very good tour there.

The Forest Alliance is a forest-industry-sponsored citizens' committee, which is constituted under the Societies Act of B.C. We have been in existence for nearly nine years and have consultative status as an NGO with the United Nations. We operate provincially, nationally, and internationally, focusing on sustainability issues in the forests of British Columbia.

We know that the real challenge is to find the right balance between the environmental and economic priorities for our forests and we know that this is not a black and white issue. It is an issue that requires a synthesis of environmental, social, and economic values—what we have come to know as sustainability.

You have many able presenters here to give you the various aspects of these issues. In particular, it is clearly evident that British Columbia is a world leader in the creation of new parks and wilderness areas, in the improvement of forest practices, and in the protection of biodiversity. I will elaborate on these issues in a moment, but first I'd just like to give you a little personal history.

I was born in the land of the Kwakiutl, which is the north island, mid-coast, and grew up on an Indian Reserve in Quatsino Sound, which the Indians called Klayina and we call Winter Harbour.

In 1971, as a member of the first Greenpeace voyage to stop U.S. hydrogen bomb testing in Alaska, I was, along with the rest of the crew, made an honorary member of the Kwakiutl people in the longhouse at Numglis, known as Alert Bay. We were given the right to use the hereditary crest of the double-headed sea serpent, Sisiutl, in order to strengthen our campaigns to save the earth. The famous artist, Richard Hunt, gave us his depiction of Sisiutl, which we used in our literature and on our ship, the Rainbow Warrior.

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I served for 15 years as the leader of Greenpeace campaigns, and I'm proud of what we accomplished. Eventually I left Greenpeace and became involved in the movement to achieve sustainability in the forest industry in my home province of British Columbia. I became an advocate of the round table, consensus-based, community-oriented approach to resolving the complex issues around land use conflict and the efforts to find this balance between economic and environmental priorities.

Last year, I was awarded a ceremonial eagle feather by Chief Stan Dixon of the Sechelt Nation for my work to promote sustainability and consensus. Chief Stan Dixon negotiated the first self-government agreement for aboriginal communities in British Columbia and led the way for the first treaty settlement under the B.C. Treaty Commission process.

My sorrow comes from the recent events surrounding Greenpeace, the group I helped to create and led for 15 years, who have now destroyed the spirit of the very hard-won support from the first nations people. They have veered from the path of truthfulness and have betrayed their original principles.

Only last year, the first nations chiefs of the mid-coast wrote a protocol that now denies and forbids the environmental movement from using the hereditary crests of the aboriginal people in their campaigns. This is a clear symbol to me of the betrayal that has occurred, a betrayal by environmentalists who have gone into the villages of the aboriginal people on the coast where I've grown up, have sought out dissident minority elements within the aboriginal communities, have propped them up and paraded them around the world, and have caused division and deceit within these communities from the outside. Then, on their Internet sites, Forest Action Network and Greenpeace are claiming the support of the aboriginal people in their campaign against the forest industry in British Columbia.

I do not believe that there could be a lower or more unworthy activity than this activity of causing division within the aboriginal communities, which has been described by Arline Wilson, chief councillor of the Heiltsuk Tribal Council, as “unequivocally without honour”. I think those are the correct words to apply. It makes me very sad to see the organization I was involved in go this way.

It is clear that the confrontational and adversarial approach is not the correct way to go, but unfortunately these groups don't care what British Columbians think. That is why they are operating in New York, San Francisco, Los Angeles, and Hamburg, etc., to foster this boycott movement against us. They don't care about the aboriginal people on the mid-coast. They don't care about the working families in British Columbia. They don't care about 3.5 million British Columbian people—or even about 30 million Canadian people. This campaign is being fought outside our country, so no matter what we think about consensus and sustainability... As we see in the newspapers just this morning, Greenpeace has said that it doesn't matter if we stop clear-cutting—they will continue their campaign anyway.

On the one hand, they say they're not against forestry. On the other hand, they say they are against clear-cutting but they are also against the opposite of clear-cutting because it's fragmentation. So what are they in favour of? Obviously they are in favour of not cutting any trees. It is very clear as far as I can see.

It's alleged that 10% of B.C. species are “endangered with extinction”. This is a complete distortion. It is true that 10% of B.C. species are on the provincial tracking list, which only means that there is interest in their status. In fact, from a global perspective, only one species in British Columbia is on the endangered species list, and that is the Vancouver Island marmot. All the other species, even the ones that are classified as endangered within British Columbia, are not endangered on a global basis, such as the spotted owl, for example.

It is also true that 140 stocks of the 9,600 known stocks of salmon have been lost. It is also a fact that only three of these are outside the area disturbed by urbanization, agriculture, and dam-building. Over 50% of all the extinct stocks are in Greater Vancouver, where the rivers are now in pipes. Yet the Greenpeace representative yesterday gave the impression that the extinction of salmon stocks is caused by forestry. In fact, on the mid-coast of British Columbia, there is only one extinct stock, from the Owikeno Lake area, where no logging has ever occurred. There is no known relationship whatsoever between the loss of fish stocks and forestry—not to say that forestry has not caused damage to fish stocks.

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The Forest Alliance supports the effort to protect endangered species, but we were opposed to the original Bill C-65, which would have given the lawyers from the Sierra Legal Defence Fund jobs for life filing lawsuits against every person and company engaged in resource extraction for human survival.

We believe there are three fundamental principles that must be met by any endangered species legislation. I believe this committee could have significant influence and could help us a great deal in achieving endangered species legislation that does not follow the terrible mistake of the United States approach. There are three principles.

First is equity. All Canadians must share equally in the cost of protecting endangered species, including the people who live in the city—where there are no endangered species because they are all dead. The only endangered species are out in the country, where the people are working in forestry, mining, fishing, tourism, and ranching, etc., but those people should not have to bear all the cost of saving the species. It should be spread equally over the citizens.

Secondly, it should be incentive based. People should be rewarded, not punished, for having endangered species in their environment, unlike the United States, where you are punished for having endangered species in your environment. We need to have an incentive program that encourages people to have endangered species on their property and in their environment.

Third is participation. Even if all Canadians share the cost, country people will be the most affected in terms of lifestyle. There's no way out of that. Therefore, it's imperative that these people be involved at the very beginning of any process to address endangered species, that they not have some big agency coming in from outside to tell them what to do.

The Forest Alliance supports independent certification of compliance with sustainable forestry principles, but we do not believe there should be a monopoly in this area at this early stage. It's important that there is competition for the best system.

Why is it that Greenpeace and the Sierra Club say they support the Forest Stewardship Council when at the same time, now that one major company in Canada, J.D. Irving, has achieved Forest Stewardship Council certification, Irving is facing a very strong campaign by the Sierra Club to oppose it? Why, when Western Forest Products is in the middle of an application for FSC certification, does Greenpeace launch a huge media campaign and a strike against Western Forest Products for seeking FSC certification?

It is because of the hypocrisy of their position. They say that people should only buy FSC-certified forest products, but on the other hand, they are fighting doubly hard to make sure no one gets certified by the FSC, because they wouldn't have a campaign if the industry was certified by the FSC. It's very clear that these are the politics around certification.

Much has been said about MacMillan Bloedel and their program to end clear-cutting and adopt variable retention harvesting. Now TimberWest and Interfor have also announced plans to adopt this system. The Forest Alliance supports these efforts, as it has always been our belief that alternative harvesting systems should be employed where they can be shown to be ecologically appropriate. We believe this is the case.

I'll draw your attention to what I believe is the most important forest management document produced in the last years, and that is the document called “An Ecological Rationale for Changing Forest Management on MacMillan Bloedel's Forest Tenure”, prepared by the Centre for Applied Conservation Biology at the University of British Columbia, led by Dr. Fred Bunnell, eminent wildlife ecologist. I think it is the best piece of work showing how we can have timber harvesting and preservation of biodiversity simultaneously on the land, and it is absolutely wonderful work for throwing out the myths around the impact of forestry on biodiversity and for showing how this can be accomplished.

In my final point, I would like to just talk about this boycott campaign and how the federal government must engage at an international level in a very strong way. Never mind the misinformation campaigns of Greenpeace: we are now facing an international public opinion that wants us to stop cutting trees. We have the World Resources Institute, the World Trade Organization, and the World Bank... Just three of the directors of the World Resources Institute are: Maurice Strong, the head of the 1972 and 1992 international environment conferences in Stockholm and Rio; William Ruckelshaus, the former head of the Environment Protection Agency of the United States and a very influential individual; and Stephan Schmidheiny, the founder of the Business Council for Sustainable Development and a very influential man at an international level.

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We will soon be faced with international opinion leaders who want to make British Columbia into a world heritage area and a world park. From their international perspective, this is how they see it. Not just crazy people chaining themselves to trees, but the leaders of the world community.

With every chance I get, I'm telling the forest industry and the CEOs that they have to change their culture from a wholesale culture to a retail culture.

Listen to what Greenpeace said yesterday. It's all about marketing a boycott campaign to the customers of our forest products. It's marketing, marketing, marketing.

And the forest industry is not up to speed at the retail level. If you look at retail, normal retail companies in Canada will spend 3% of their gross sales on advertising. Somewhere in the neighbourhood of $1 billion to $2 billion per year for the forest industry should be spent on television, on MuchMusic and MTV, on CNN and YTV, to reach the people and give them our story.

As it was very capably mentioned, we're not going to North Carolina and telling the people who are buying our products who we are and what we do. And this huge effort is required.

Oliver Stone said British Columbians are the real natural born killers. Woody Harrelson, Tom Cruise—all these big Hollywood people are against us and in favour of the Forest Action Network and Greenpeace. We have to turn that around. We need to hire Steven Spielberg and the Dreamworks team. We need to get champions from the sports industries and other types to go to bat for British Columbia and Canada and the forest industry, and this is a national issue of huge significance.

I don't know if you know of the film that's been made in Quebec recently by Richard Desjardins, the famous poet and musician. This has had a huge impact in the newspapers and the media in Quebec, and the forest industry in Quebec is very afraid of this. The target is Canada, if you go outside our borders, not just B.C. Therefore, I encourage the federal government and your committee in particular to lead the federal government in addressing this in a serious way.

May I also just point your attention to this document that was passed around called, “Market boycott campaign tactics used against Canadian forestry companies”, just in case there is any doubt lingering in your mind that we are facing a boycott campaign.

The Chair: Thank you, Mr. Moore. Your full brief is also a matter of record now for the committee.

I invite Mr. Arkle, on behalf of the Association of British Columbia Professional Foresters, to commence.

Mr. Nick Arkle (President, Association of British Columbia Professional Foresters): Thank you very much, Mr. Chair.

I'll refer to my association as the ABCPF from now on. With me today are two members of our association staff, executive director, Van Scoffield, and registrar and manager, professional standards, Jerome Marburg.

On behalf of our 3,900 members, almost half of the professional foresters in Canada, I too would like to welcome you to British Columbia. We're honoured to meet with you and to have this opportunity to contribute to your understanding of B.C. forest practices in the context of international trade.

Our members work in roughly equal numbers, a third each in industry, government, and the consulting field, and do so in every corner of the province, including the Cariboo-Chilcotin, central coast, and north island regions you visited earlier this week. In fact, you most likely met many of them, and if you look at the business cards, they'll have RPF written after their names.

The ABCPF was established in 1947 with the passage of the Foresters Act by the B.C. legislature. In general, we are a professional regulatory body not unlike those that regulate the medical, legal, accounting, engineering, and many other professions.

My purpose here today is first to familiarize you with the profession of forestry as it exists here in B.C. Secondly, I would like to point out that the degree to which the profession is regulated in this province should give critics at home and abroad some confidence that the state of the forestry industry in B.C. is considerably better than they've been led to believe.

Let me begin with a review of the key parts of the Foresters Act. Section 1 of the act provides a fairly comprehensive definition of the practice of professional forestry. In summary it says the practice comprises managing forests; assessing the impact of activities on the forest; designing, specifying, and approving forest practices; planning, locating, and approving forest transportation systems; and examining and verifying forest management performance.

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The purpose of the association, as set out in section 3 of the act is to, and I quote:

uphold the public interest in the practice of professional forestry by ensuring

(a) the competence, independence and integrity of its members and

(b) that every person practicing professional forestry is accountable to the association and to the public.

And finally subsection 22(1) of the act states that, and I quote:

a person must not engage in the practice of professional forestry unless that person is a member or holder of a special permit.

In other words, the only people lawfully entitled to practice professional forestry in B.C. are our members, and the association exists to make sure they are competent, independent, ethical, and accountable.

To become a registered professional forester in B.C., some rigorous requirements must be met. In the main, these involve the following three criteria: the successful completion of an accredited university education in forestry; the completion of two years of relevant work experience under the oversight of a sponsoring forester; and finally, the successful completion and passing of a rigorous registration exam. This means, in general, a minimum of six years of university education and training to become a professional forester.

Once admitted, members are subject to a variety of ongoing requirements and standards. Prominent among them, our code of ethics imposes on members certain professional responsibilities to the public, the profession, the client or employer, and other members. Members who fail to live up to these responsibilities or to comply with the act or the bylaws, or who fail to behave professionally, may be subject to discipline up to and including removal from the profession and imposition of fines up to $10,000. Complaints may be made by the public, other members, or the association itself. The ABCPF typically handles 10 to 15 complaints per year.

Up to this point, I provided you with a brief background on how the profession is regulated in B.C. I would now like to relate this to the issue the committee is addressing at present, the study of Canadian forest practices as an international trade issue.

The key point we want to make is in contrast to what you may have heard: the practice of forestry is not an unsupervised, cut-and-run exercise here in B.C. On the contrary, there is little doubt we have the most highly regulated forest sector in the world. For starters, there's legislation like the Forest Act and the Forest Practices Code Act, administered by the Ministry of Forests and the Ministry of Environment Lands and Parks. Then there's the Forest Practices Board Act, administered by the Forest Practices Board, with its focus on the performance of licensees. And finally, there is the Foresters Act, administered by us, with its focus on the performance of professional foresters.

With respect to the profession specifically, we would submit that not enough information has been provided to foreign critics to make them aware of the degree to which our profession is regulated and the high standards required of professional foresters here in B.C. We would argue that this reality constitutes an important element in a comprehensive system designed to ensure B.C. forest practices are sound. This message should be incorporated in all the federal government's external communications on this matter.

I would now like to share some thoughts with you concerning the five themes the committee indicated were of specific interest.

Regarding the current state of B.C. forest management and practices, the issue is less one of good or bad forest practices and appears to be more one of conflicting perceptions of what are good or bad practices. The roots of our problem lie in a clash of rapidly shifting public values both within and outside B.C. The globalization of B.C. issues has greatly complicated matters.

The ABCPF has publicly called for a comprehensive, inclusive, and transparent review of B.C. forest policy, beginning with a process to seek a public consensus on a vision for our forest resources. This would be followed by a process to develop a new set of policies designed to fulfil the agreed vision.

ABCPF is supportive of moving responsibly towards a more results-based approach to forest practices regulation. This will require greater reliance on the professional judgment and accountability of our members and other professionals. Prerequisites to do this include: the development of publicly sanctioned high-level goals, plans, and objectives to guide professional judgment; the provision of greater support and respect for professionals being asked to carry this burden; and finally, the time to effect the necessary culture shift within professional ranks from one based on prescriptive regulation to one based on the independent exercise of professional discretion.

Secondly, regarding the potential of alternative harvesting practices, the ABCPF statements in response to Macmillan Bloedel's May 1998 abandonment of clear-cutting in favour of variable retention harvesting is included in the package. We have not revisited this statement in light of recent decisions and announcements by TimberWest and Interfor.

To some extent, it's fair to say we're still learning. We can be successful with forestery practices like variable retention that we formerly thought were unwise or not viable. However, it is also fair to say that the system is simply adjusting to changing public values and it is seeking solutions that are socially accepted without paying too high a price in economic and environmental terms.

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Three, regarding implementation of forest certification systems, given the degree of internal regulation of B.C. forest practices, one could argue that external certification processes should not be necessary. However, for the reasons already noted, the ground has shifted and certification is rapidly becoming a reality. The ABCPF views third-party certification as complementary or supplemental to the province's own quality assurance measures, including that of the ABCPF.

While we accept that some of the expertise brought to bear in the conduct of forest practices certification has nothing to do with the practice of forestry per se, our interpretation is that the certifying of forest practice includes important elements that do fall within the definition of professional forestry under the Foresters Act. Accordingly, our position is that the certification team must include professional foresters. This view has been communicated to the head of the FSC, and we believe accepted. It would be very helpful if the federal government reinforced this message.

Four, regarding the state of forest-dependent and aboriginal communities, it is unavoidable that forest-dependent communities will suffer if high-return forestry operations diminish as social values shift and different choices are made to favour one resource value more than another. It is therefore essential that forest-dependent communities have a major say in the determination of forest policies. It is necessary and appropriate for government to provide bridging assistance to persons adversely affected by economic adversity arising from economic and policy changes beyond their control.

It is also a reality in B.C. that in the next decade or two, first nations will assume outright ownership or gain management interest in a significant portion of B.C.'s forest lands. The practice of forestry on treaty lands will still come under the jurisdiction of the ABCPF. At this point, however, there are only a handful—less than ten—RPFs of first nation descent. It is clear that a major capacity-building effort is required to prepare first nations to cope with the professional forestry challenges they are beginning to face.

Finally, regarding international trade and the role of the federal government, in its communications with Canadian and international audiences, the federal government should communicate the message that forestry is a regulated profession in Canada and therefore that our forest resources are managed by competent, accountable professionals whose planning embraces all resource values. This is a significant comparative advantage that should be exploited more than it has been to date.

By way of background, there are five provinces in which the profession of forestry is legislated: British Columbia, Alberta, Ontario, Quebec, and New Brunswick. Historically, only two of these, B.C. and Quebec, have full-fledged right-to-practice legislation. The others have had more limited right-to-title legislation. However, both Alberta and Ontario are in the final stages of upgrading their legislation to right-to-practice status. The point is that the profession is regulated in virtually all provinces having significant forest resources.

Many people have the impression that foresters are just concerned about timber. That is not so. I can give you some evidence from my own personal experience if you wish, but I'd also like to point out that our academic standards require those who become registered to have a broad interdisciplinary grounding. For example, among the 26 subject areas that must be covered are ecology, entomology, hydrology, integrated resource management, pathology, and principles of biology in soils.

I'd like to thank you at this point and turn it back to the standing committee, should you have any questions of us.

The Chair: Thank you very much, Mr. Arkle.

We'll conclude with Keith Moore, chair of the Forest Practices Board.

Mr. Keith Moore (Chair, Forest Practices Board): Thank you, Mr. Chairman, and good morning, bonjour. My name is Keith Moore, and as you said, I am the chair of British Columbia's Forest Practices Board. The board is a publicly funded, independent watchdog for sound forest management in B.C. The role of the board is to provide an independent and objective assessment of forestry practices in the province. We report directly to the public and to three provincial ministers about compliance with B.C.'s Forest Practices Code, and we report on the achievement of the intent of that code and its fair and equitable application.

We contribute to the continuing improvement of practices in the province. We do this through four programs that reflect our legal mandate. First, we audit forestry operations in the field, looking at both government and private company operations. We are like an auditor general in that regard. We are an independent third-party auditor.

The second thing we do is investigate complaints from the public about forestry matters, and we can initiate special investigations. We are like a bush ombudsman in that regard.

The third thing we do is we can challenge government decisions on public lands. We're like a public interest advocate.

Finally, we report to the public about everything we do, and we hear from the public about forest practices in the province.

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The board has seven members with very diverse backgrounds from communities around the province. We have a staff of about 30, and we use a large number of consultants every year in the field around the province.

In this brief time I have, I want to touch on three things: B.C.'s code; an assessment of the current state of planning and practices in the province; and the relationship between the code and certification. I think that touches on three of five of your points.

What is B.C.'s code? First, it's a law. It regulates all aspects of logging, road work, fire protection, and reforestation on publicly owned lands and some privately owned lands in the province. That's virtually all the forest land in the province.

The code was introduced in 1995 to replace a very confusing set of guidelines that were largely unenforceable. It replaced those with requirements set out in legislation. The code was a response to some rapidly changing social values, some demonstrated poor practices, and to the growing international attention British Columbia was beginning to experience in the early 1990s.

Several things are important. First, this is a hugely diverse province with diverse landscapes, with a very incredible richness of resources—biological resources, economic resources, cultural resources—and the code sets out to address that huge array of landscapes and resources. It is probably the most complex code in the world. That's because it regulates plans and practices on a very large, diverse, and probably the most complex forest jurisdiction in the world. It deals with plans and practices for operations. It does not make social choices, but it does reflect some political and social choices that were made around the balance of environmental, economic, and social values.

The code works in concert with a number of other initiatives, like the regional land use plans, wildlife strategies, and establishment of new protected areas in the province, where particularly social choices are being made.

Second, the code sets a minimum standard of practice that everyone operating on those public lands and some private lands must meet. It's a basic platform from which better practices can develop. It's a floor, not a ceiling. The board expects that to meet some objectives set out in the code it will be necessary to implement practices that are more than the minimum set out in the code.

It provides a lot of discretion. Some have seen that as a strength; some have seen that as a weakness. But in this diverse landscape it is a reality that there needs to be flexibility and a lot of opportunity for discretion in decision-making.

Fourth, the code creates legal obligations for both government and companies, and that's important.

Finally, it creates a number of organizations, including an independent watchdog, the Forest Practices Board, that assesses government and forest companies' performance.

Does the code itself ensure that practices are sound and sustainable? The answer is no, not alone. The code needs to be implemented in conjunction with other initiatives that are presently underway, such as assuring a sustainable level of cutting, establishing new parks and protected areas, restoring areas damaged by previous operations, and implementing locally based land use plans. But the code is certainly a very important part of practising sustainable forest management and of being able to demonstrate to people here in British Columbia and in marketplaces around the world that the forest is well managed and the environment is protected. It is, in our view, a very important part of certification, and I'll speak to that in a minute.

The board has developed a report card on where we are with forest practices, and I'm going to quickly provide four messages here.

The first one was quoted earlier. There have been changes and significant improvements in forest practices in B.C. since the code came into effect. There is good news here.

Second, there is a need for better compliance with code requirements, and there is a need for more effective opportunities for public involvement. In both of these areas, there is room for improvement in the application and implementation of the code.

Third, there are important pieces of the Forest Practices Code that have not been implemented. These are significant gaps and deficiencies, and they mean that some important objectives of the forest practices code cannot be met at the moment.

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Finally, the fourth point, in our view there is a need for better plans and implementation of those missing pieces. I could provide you with a lot of detail on all of those. I think I want to be brief. I will repeat that there is an improvement. Most operations we have audited are in compliance with most requirements, and there's some evidence from our audits that compliance is improving year by year. The code did establish a level playing field. It has improved public confidence. It has brought positive results.

I could document our second point, which is that although client compliance is generally high, there is still significant non-compliance with code requirements in some of the operations we have audited.

The missing pieces, the third point, principally relates to concerns at scales larger than cutblocks. The code is very good at improving practices cutblock by cutblock, road location by road location. What the missing pieces relate to are implementation of measures that ensure that on larger scales, like landscapes, the diversity of wildlife, the grizzly bears, the marbled murrelets, the scenery, the tourism opportunities—those kinds of things—are protected. Those pieces, in our view, are still missing in the code.

Finally, we have said there's a need for some better plans. In order to protect those values, we need to clearly set objectives. Plans then deliver methods to achieve objectives. We are still short in British Columbia on objectives, and we will, in our view, have some difficulty in demonstrating that we are protecting resource values, particularly non-timber resource values.

The code, as you know, is not static. I will skip the piece that comments on some of the recent changes to the code. The code is changing rapidly. From our view, what is important is that the government needs to remember that the code has achieved some very significant benefits. We need to ensure that we retain the benefits while we continue to try to improve the efficiency and effectiveness and streamlining of the code.

Let me comment a little bit on certification. The code and the board have a major role to play. Compliance with local legislation, such as the code, is a key component of each of the major certification schemes at the moment. It is, for example, part of principle one of the Forest Stewardship Council.

All certification schemes also use independent audits to assess performance against a set of predetermined standards. So in B.C. there is legislation. It's very comprehensive legislation; that's the code. And there is an independent body—that's the board—which is carrying out audits to determine and report publicly about compliance with that legislation. So in effect, in relation to that legislation, the Forest Practices Board is, at this point, a certifier of forest practices in B.C.

However, the extent to which the code and the board can contribute is somewhat limited. The code does set some clear standards in some important areas, but there are important elements of certification that are not addressed in the code and that go well beyond the parameters of the code. Those are things like ensuring the sustainability of cutting rights, protecting threatened species, representing ecosystems, and particularly addressing the interests of first nations people and non-native interest groups like workers and communities.

So we expect that certification audits are going to be dealing with a much broader and a much more complex set of issues than are set out in the Forest Practices Code and that are presently being audited by the Forest Practices Board.

Compliance with local legislation is going to be a difficult issue to address. That is an important issue that has not been discussed too much. It seems to me that some people think certification will be somewhat automatic—once we have a process, companies will simply line up and then they will be certified. Our audits might suggest otherwise, depending on how you define compliance. We only report significant non-compliance—that is, compliance where we think there is an impact on the environment or there is something happening that is of interest to the public. In a number of our audits—it's about 10 out of the 16 we have reported publicly—we are reporting significant non-compliance. If certifiers choose to take a similar view of compliance with local legislation as we have, then some of these companies are going to have difficulty getting certified. In my view, it's not automatic.

I'm going to wrap up. What we are hearing is that certification schemes need to converge. There needs to be a process where these schemes can benefit from each other, not compete with each other.

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We are hearing that the Forest Stewardship Council is gaining significantly in the marketplace, the end-end consumer marketplace. I think there is a real need for us to move quickly to implement regional standards for the Forest Stewardship Council. At this point my understanding is the development of those standards is largely done by a small group of volunteers who are essentially unfunded. I think this is too important to leave to that kind of process at this point; we need those regional standards for the FSC.

Finally, I am increasingly convinced that B.C. and the federal government need to look at this as an important area of public policy. It is becoming much too important for us to simply lead to an issue of corporate policy and market access. I say that for two reasons. First, I think it goes well beyond the needs of those corporations and it speaks to the needs of people like myself who still live in a small community of 800 people. The people in my community need to be assured that we are going to be able to meet the needs of the marketplace.

Second, I think there is a real need for defined forest areas to certify. In British Columbia, as long as we are principally a volume-based tenure system, I think there are going to be difficulties in certifying those volume-based tenures. The government is the landlord and in many ways the government is the land manager, and I think the land management issues and certification are going to have be addressed through public policy development, not individual corporate offices.

Thank you. I took more time than I had intended. I would be pleased to provide you with any additional information. I have circulated a binder with some of the documents this morning. Thank you.

The Chair: Thank you, Mr. Moore. All of you were excellent and we all wish we had a day to spend with you. We're going to go right to questions, and we'll do our very best, in a short period of time, to get members in.

Mr. Schmidt, please.

Mr. Werner Schmidt: Thank you very much, Mr. Chairman. And thank you, gentlemen, for appearing. I wish we had had an hour for each one of you, rather than all three of you in one hour. That's the one point.

I think I want to zero in on the remarks you made, Dr. Moore, with regard to the shift in attitude and emphasis on the part of industry from a wholesale to a retail operation, and the comments you made with regard to Greenpeace as not being at all interested in forestry to begin with; they just don't want any trees to be cut down. If that's the issue, the problem becomes a very complex one, because then all these good things that the professional foresters are doing, and all the good things the Forestry Council is doing, are insignificant.

If there isn't any market for the wood out there, it doesn't mean anything. We have, from the experience we've had in the last couple of days, a very clear awareness that the forest industry, like a lot of well-established industries, is very conservative in their orientation to their activities. They've been successful. They've developed a very successful business. They have a good market, and now all of a sudden the world is changing, and how do they get ready to change with that marketplace?

I think the point you've made is very significant, about getting some of the mass media involved to do some of the things you're talking about. But I'd like to step back one step and ask how we get the management, the shareholders, of these forestry companies to change their attitude so that in fact the kinds of things you're saying are believed to the point where they'll actually change some of their behaviour and their policies. That I think is at the heart of the point you're making. That's ultimately where the decision is going to be made. So I'd like you to go that one step back. How do you initiate a social change and actually carry forth that social change in an organization as big as Weyerhaueser and MacMillan Bloedel and so on?

Mr. Patrick Moore: With great difficulty. We are really talking about changing the culture of an industry that of course is made up of the individuals in the industry. Traditionally the forest industry has not been about advertising and about making wood products sexy. If you take Nike, for example, with their swoosh, and with Michael Jordan and Tiger Woods as their champions, even though they have some very difficult social problems with their labour practices, for example, they are able to completely overcome that through the use of these kinds of approaches in marketing access.

The forest industry has an incredibly positive story to tell. We pay our people well. We do a good job of providing the most renewable resource in the world. It is a hugely positive story, though we're not taking advantage of it. Meanwhile Coca-Cola and Pepsi-Cola spend hundreds of millions of dollars per year to hire Michael Jackson to convince the public that one brand of caramelized soda water is better than the other, when in fact there is no socially redeeming value in this whatsoever. It's probably negative from a health perspective, and yet hundreds and hundreds of millions of dollars are spent on this.

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So how do we make this shift in the forest industry? It's going to have to come about through time, through attrition, through changing personnel coming in who recognize the need for this requirement. I see it happening in the companies in British Columbia alone. A younger breed of people with post-war thinking is coming in, and they understand more about communication and marketing and getting a bit more with it. But that's what has to be done.

Mr. Werner Schmidt: I'd like to go one step further. What we heard from the professional foresters and we also heard from the board just now are features of what we're doing. They're great and wonderful features that we have, and I admire what's going on. It's a tremendous positive development that's taking place, but where are the benefits of what's being done?

The consuming public doesn't, first of all, look at what are all the technical features of what we're doing well. They want to know, what's the benefit for me? What's the benefit for my kids? What's the benefit for our society? What's the benefit for the next business and the next generation? That's what they want to know. They don't want to know the features. They don't care about the features, because ultimately that's your business. You're a professional. Don't tell me how it works. Just tell me what it will do for me.

How can we get there?

Mr. Patrick Moore: Part of the answer there has to do with renewability and sustainability, and actually at the international level one of our strongest elements within the forest sector is the climate change issue. The Kyoto meeting in Japan agreed that forests will now be part of national carbon budgets. Initially they had not been included. Now they are included. Yet at Buenos Aires, the meeting following that, even though there were 400 representatives from the nuclear industry and 280 representatives from the environmental movement and many other sectors, only one official representative from the forest sector was there from the German private forest owners.

The forest industry, and the governments that represent countries in the forest industry, are not coming forward on this very critical issue. Because the consuming public can be told truthfully that if they use wood instead of steel, cement or plastic, for example, when they go into a Home Depot to choose a hammer and they decide on what kind of handle they want, either a plastic handle, a steel handle, or a wooden handle, they know if they buy a wooden handle they are doing more for reducing carbon dioxide emissions and preventing climate change than if they buy the other two kinds.

We're not taking advantage of this very powerful connection between forests and carbon. It's a huge issue that needs to be addressed and people can relate to it.

It's the same with biodiversity. As I say, we should be marketing our forest, not just our wood products. We should be saying to people in South Carolina, you think our 2x4s are good; wait till you see our salmon rivers and our grizzly bears and our beautiful mountains. Every 2x4 should have this message with it and should be attracting people to come here and see for themselves where their wood products are coming from.

Also, we need the forest industry to become partners with the tourism industry much more closely. These are seen as conflicting because they're both using the same land for very different purposes. If the forest industry would invest in ecotourism and buy shares in ecotourism companies and become involved directly with these industries, we could harmonize the self-interest, which is now often seen in conflict with each other.

So there are many things the forest industry could do to broaden its appeal and its involvement. Again, one of the problems is, as you say, a very conservative, business-oriented, wholesale-oriented approach of commodity production, which has been successful in making this industry become the largest one in the country. Making that shift from hiring people from Madison Avenue and Hollywood is something that's not inside the industry.

Mr. Werner Schmidt: Would the professional foresters agree with Dr. Moore that this is the orientation they would have to adopt as well?

Mr. Nick Arkle: Maybe I could back up a little bit. Let me tell you a little bit about how the foresters work.

One of the suspicions that's always been out there is that it's the executive officers who are running woodlands departments; it's the executive officers who are telling foresters how to do their jobs out there. The people who are working with the communities, the people who are ensuring that forestry practices are done in the correct manner, are the people who live in those communities. They tend to be professional foresters, and the team that works with them, whether it's biologists, technicians, or whatever... They are the ones who make the decisions. I think you'd be very hard pressed to find a woodlands department anywhere in this province where they have a CEO who breathes down their neck every morning, saying, thou shalt not do it that way because I don't want you to do it that way. It won't suit the balance sheet adequately enough. In fact, professional foresters are left to do the management the way they should.

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Mr. Werner Schmidt: I guess I didn't ask the question right, because you're not even close to what I'm trying to ask you about. I'm asking you about what the professional foresters have to do, or would they be even sympathetic to the idea of going into a retail type of advertising and promotion of wood products rather than the wholesale one? That's the question.

Mr. Nick Arkle: Sorry. The point I was trying to make is yes, I think we need to get that message across.

Mr. Werner Schmidt: To them.

Mr. Nick Arkle: Yes. Either that or you hire Michael Jackson to become a professional forester, and I don't think that's a good idea.

Mr. Werner Schmidt: I wouldn't object to that either.

The Chair: Very good, Werner. Thank you.

Alex, please.

Mr. Alex Shepherd: Thank you. Dr. Moore gave a very good presentation. I think what we're watching is the world is changing in the sense that we're developing these horizontal communities, and I don't think in a lot of ways that Canadians have taken up this new message. That's basically how Greenpeace and others keep connected.

Governments are going to have the same problem. We're all politicians around here. I get letters from people who are upset about the forest or whatever, and it's not well-founded. They don't understand it, but it's a knee-jerk reaction. The answer to the industry is that their shareholder values are going in the toilet. That'll be the next thing. Nobody's going to want to invest in a forestry company because it would just be plain uncool to do. Right now, all their stocks are in the toilet, right? The more you continue to cripple the financial wherewithal of those industries, the more these international collective groups are going to be successful.

So I understand what you're saying. It seems to me all of this is about messaging. We've spent a lot of time talking about certification. All of those things are good and positive. But it's a typical Canadian way to solve a problem. We're going to be better or we'll be nicer and so forth, but it will all mean nothing if the world doesn't appreciate it and evaluate it.

So basically, on your theme, how do we get this moving? How do we get everybody singing from the same hymn book and put a consolidated, focused basically public relations program in here that reverses the tide? Everything I've heard in the last two days has been that we're reacting. We're reacting to a force that we don't understand, and we're reacting very fractionally. The industry's doing one thing, the workers are doing something else, and the native community's off on another tangent. How do we get this into a proactive messaging worldwide?

Mr. Patrick Moore: The vision that's developed within the Forest Alliance of B.C. is the vision of building a bridge between our communities and our customers. We are working on these two fronts simultaneously. For example, just beginning today in Campbell River and over the weekend, we're sponsoring a major community forum to bring people together to discuss the future of forestry in our communities on Vancouver Island and the mid-coast.

At the same time, last week Tom Tevlin and Keith Moore were in San Francisco at a meeting sponsored by Business for Social Responsibility, which brought together companies such as IBM, Hewlett-Packard, Levi Strauss, Nike, Liz Claiborne, and Starbucks together, and all these people who are involved in this Fortune 500-Greenpeace effort to boycott B.C. forest products. They were all brought together to talk about these issues. We have a major effort required here.

So we have the vision. It's called building a bridge between our communities and our customers. What Greenpeace and others are doing is going to those customers and lying about our communities, lying about what the people in British Columbia are actually doing and what they are like, and making them appear as Oliver Stone says: natural-born killers. What we have to do is expose our customers to our communities. In other words, bring IBM and Hewlett-Packard here in the same way that you have seen this. But this costs a lot of money, and it's only part of the puzzle, of course. We should have $100 million to do this in the Forest Alliance, but we have $2 million.

It's impossible to deal with the Fortune 500 companies, which all have environmental vice-presidents, many of whom have high credentials and are very good to speak to and understand the issues once you get to them. But if they're in New York in an office tower and Greenpeace comes in and gives them all this garbage about how we're destroying the earth up here, they often end up thinking maybe they can make their company look better by going that route. It's called painting yourself green at your customers' expense. It's all part of the “blackmail in the boardroom” approach that Greepeace uses. They say, either you boycott B.C. or we'll boycott you. That's the challenge they are left with at the staff level. What are they going to do for their board of directors and their CEO? They're going to try to make themselves look good, and that often involves making us look bad.

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So that's what we're up against. That's what we have to fight. It's going to cost hundreds of millions of dollars to do it because it's the marketplace of the world. We 3.5 billion British Columbians serve over 1 billion human beings with our products in the international marketplace. We need some pretty serious leverage to be able to be heard in 1 billion ears when there are only 3.5 million of us. That's going to take money, just hard cold cash, and creativity along with it in terms of communication. The popular culture is what we're talking about here; we do need the equivalent of Michael Jackson.

The Chair: Thank you.

Mr. Alex Shepherd: Just one little addendum. Do we have a proactive website that attempts to counter Greenpeace?

Mr. Patrick Moore: Yes, the Forest Alliance website is www.forest.org.

The Chair: Thank you, Alex.

I have Phil and Yvon. Phil, please.

Mr. Philip Mayfield: Thank you very much. I'd like to thank you gentlemen for being here to participate in this inquiry today. I'd like to particularly welcome you, Mr. Scoffield. Your coming to be with the professional foresters here is our loss in Williams Lake. I want you to know how much we valued your presence in our community.

Beyond that, what I want to talk about or ask about is something about this idea of certification. It's a little bit slippery for me in my mind yet. Every time I try to pick it up, it seems to squirt out in a different direction. I really don't have a hold on it. It seems to me that the ultimate authority in British Columbia still lies with the British Columbia government. Within the government and within the corporations are the professional foresters.

I have to say that one of the most stimulating things for me is to walk through the forest I grew up in and love. But to walk through it with one who has studied it as a forester has, and have him talk about it as we go along, that's really exhilarating. What is so good is usually the person I walk with is one who loves the forest, loves the land, loves what lives in the forest, and is able to talk about it in a knowledgeable way. So in my mind there's a lot of credibility in that experience.

Credibility is one of the questions I want to pursue with the foresters. With the questions that are being raised about our forest practices, some of it has been, I suppose, getting to know the forests and ourselves better as we go along and using better techniques in our forestry practices. But as we look at this issue of certification, where do the foresters see this going? How do they see themselves involved in it? Do you see yourselves as being the kind of credible presence that the world would listen to? There's the government, there's the company, there's also the Forest Practices Board—and your presentation, Mr. Moore, was excellent, very stimulating.

How do we as Canadians, British Columbians and Canadians, federal, provincial governments, approach this question of certification in a way that will mean something to the world? Beyond that, and a slippery issue is, as Dr. Patrick Moore mentions today, that this may not be the issue. It may be going to the retail rather than the wholesale way of looking at it, and taking the approach other high-powered companies have taken. Is this certification issue itself a red herring?

Maybe you could help with these questions, because I want to know about your credibility. I want to know about the importance of certification, if it's a valid issue. I want to know if perhaps this is an agenda that is leading us from where we want to go.

The Chair: Thank you, Philip.

Mr. Van Scoffield (Executive Director, Association of British Columbia Professional Foresters): Thank you, Philip. It's a pleasure to see you again after all those years in Williams Lake.

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We had a meeting with the senior management of the Canadian Forestry Service in B.C. some months back. I think it was Bill Wilson who said that unfortunately we're in the process of losing control over our forest policy to an international group of elites. That rankles on all of us, but I think there's a fair amount of truth in it. I don't know if we or anybody has a good answer on how to change that.

Back in March, the Price Waterhouse annual forest industry conference was held here in Vancouver. There was a whole bunch of speakers, but two of them were particularly germane to understanding where certification fits in. I'm sorry, I wasn't prepared, this just popped into my head. One was from the U.K. I think he was with FSC in the U.K. I could probably find the speeches that were presented. The other speaker was the president and CEO of Home Depot Canada.

The Chair: Find those speeches and give them to the clerk. We will share them with the committee members.

Mr. Van Scoffield: They spoke very eloquently on why the world is buying into certification and why suppliers or marketers—merchandisers like Home Depot are perhaps reluctantly recognizing they have to go that route. I think it would be helpful for the committee to read those speeches.

A lot of it has to do with complete mistrust of established authority. Governments, whether federal or provincial, aren't trusted and their systems aren't trusted. Agencies like Keith Moore's Forest Practices Board are maybe trusted more, but a lot of people really don't believe him either. There are certainly a lot of people who don't have much faith in us.

Mr. Yvon Godin: That's a big problem.

Mr. Van Scoffield: Yes.

In the face of that, we need to do what we can to try to alter the trend. Some of the things we and others have suggested to you today are along those lines, but we have to adapt a lot of it. We reacted quite slowly to the developing certification process and didn't stick our oars in, but recently we've begun to focus on it more. We've made it clear to the certifying agencies that in law there should be foresters involved in it.

The reality is that third-party certification is what people are looking for, and we will have to adapt to it. It's just like forest practices. You look at the decision of MacMillan Bloedel and more recently Interfor and TimberWest to shift away from reliance primarily on clear-cut logging, and it's simply driven by those changing public values. Whether they are as well informed as we would like or not is almost irrelevant. They are changing.

As professional foresters, we look at that and we say we have to stay within a space that is professionally, ethically, and scientifically manageable and acceptable, but if we want to be over here the way we were for decades in the past, it just isn't going to fly. So companies like MacMillan Bloedel and their foresters are shifting.

I often look at it as if we're trying to operate in an area that overlaps a social, environmental, and economic viability. All three things have to work at the same time. Right now, that social layer is moving quite rapidly on us, and it's shifting the area that's common to all three. Hopefully we still have some common area.

Thank you.

The Chair: Thank you, Mr. Scoffield.

Maybe just a short comment from Keith Moore and then we'll move on.

Mr. Philip Mayfield: Will you allow Dr. Patrick Moore to make a short comment?

The Chair: That's okay, if he can promise to make it short.

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Mr. Keith Moore: I wrote down three questions here. First, is it a red herring? Second, what's it going to take for credibility? Third, is it about going directly to consumers?

Is it a red herring? No, it is not. This is big. This is central. This is moving from a corporate issue to a public policy issue, in my view. It is very important to us.

Second, to have credibility it will take a credible, independent, third-party audit scheme and validation of that independent third-party audit.

Mr. Philip Mayfield: Who will be involved in that third party?

Mr. Keith Moore: That will be the issue. I agree with Patrick that this is not about which wholesaler buys the 2x4s; it's about who buys their coffee at Starbucks, who buys their soap at the Body Shop, who buys their jeans from Liz Claiborne, and who gets money from the Bank of America. It's at that really far end, and it will be about validators.

That's partly why my view right now, based on my experience recently in San Francisco, is that the Forest Stewardship Council has a big leg up, because their validator at the moment is a major environmental group, notably the World Wildlife Fund. It's about opinion polls. Who do you believe? We've seen them. They are scientists and environmental groups, and then somewhere below that are professional foresters and people who work in the industry.

On the third question, it's about going directly to consumers. Some people will be interested in certification, but others won't want to touch it because they will want it to be part of their own corporate branding—to be environmentally responsible. They will want to go on their own to validate and make this part of their own image of the product they sell, whether it's paper, wood or a hammer handle.

The Chair: Thank you.

Mr. Keith Moore: Sorry I wasn't brief.

The Chair: Dr. Moore.

Mr. Patrick Moore: We have to make a clear distinction between the fact that the idea of certification as independent verification of sustainable forestry practices and compliance with those is a good idea, but the politics surrounding the situation right now are insane. The extreme anti-forestry groups like Greenpeace are using the certification issue, not as a tool to improve forestry, but to eliminate it. That's why they oppose Western Forest Products' and J.D. Irving's FSC approaches. They're trying to get rid of the forestry and they want to have a campaign to stop it.

FSC at Oaxaca, at the international level, has moved more toward the centre now. Their chairman is the president of Assi Domain, which is one of Sweden's largest forest companies. One of the problems is that the forest industry in North American did not engage constructively with the FSC in the early years and is therefore not really part of it. So the challenge is to marginalize the extremists out of an FSC, if it's going to become the world-accepted standard, to harmonize CSA and ISO with FSC to get more...

For example, on the B.C. working group of the FSC there is no forest industry representative, and they won't allow one to come on it either, because people have applied. Now you cannot have a B.C. Forest Stewardship Council standard being developed with no participation from the industry. But that is the state we're at. That is why maybe a little more attention has to be placed by government again, as others have mentioned. The B.C. government is ultimately the landlord and is responsible for whatever happens on the public lands in B.C.

Perhaps the B.C. government should be applying for status with the Forest Stewardship Council. It should be taking part in the process and applying for the TSAs to be certified, because after all, they're the ones who are managing them. If we talk like Keith does about being area-based, the only area base we have is the timber supply area, other than the tree farm licences, which are area-based tenures with one company on them. But in most of the province, 70% of the cut, the timber supply area is a volume-based tenure. But it is a defined forest area if you go to the provincial level because the province is managing it as a forest area. Perhaps they're the ones to apply for certification.

Until now the provincial government has stood back and remained aloof from the certification process, saying they don't want to pick winners and losers, etc., and it's up to the industry because it's mainly a marketing thing. I disagree with them 100% there. It has a great deal to do with marketing, but it also has to do with improving forestry practises and sustainable development. I think they should become more—

The Chair: Thank you, Dr. Moore.

• 1145

Mr. Philip Mayfield: Mr. Chairman, I don't have any more questions, but perhaps—

The Chair: Is it a point of order?

Some hon. members: Oh, oh!

Mr. Philip Mayfield: Well, yes it is. In the order of the proceedings, I'd like to know if there's a role for the federal government in what Dr. Moore's been talking about.

The Chair: I'll tell you what. I think that question has been asked. It's on the record. What I remember hearing is that the government can assist by coordination and by involving players but we shouldn't be taking the lead. That's a quick summary of what I remember hearing over the last two days.

Let's go to Yvon because Werner and I are going to miss our flights if we don't do this.

Yvon, please.

Mr. Yvon Godin: Again, what time is your flight?

[Translation]

First of all, I want to thank you for being here and welcome you to the Committee. I know that our time is limited, but you made excellent presentations. The important thing is that we remember the points you raised in those presentations.

I would like to put a question to Mr. Keith Moore with respect to the code of practice. You say a great deal more must be done in that area. Having visited a couple of sites in the past couple of days, I have reason to believe that the people who acted as our guides were sincere. We visited areas where there has been some reforestation, which is really quite promising.

In their presentation yesterday, Greenpeace representatives gave us the impression that no one was following these codes of practice. I would like to hear your views on that. Are we moving in the right direction or are we missing the boat? Mr. Van Scoffield was saying earlier that a lot of people don't respect the government, the companies, the organizations, and so forth, but respect is something that must be won, and that takes time. It takes longer to win someone's respect than it does to lose it. So, I want to know whether we are actually moving in the right direction or whether we have a major problem on our hands.

[English]

The Chair: Thank you, Yvon.

Mr. Keith Moore: Thank you.

We are definitely moving very rapidly and significantly in the right direction. There is no doubt of that in the work we have done, the 60 or 80 consultants that I have in the field every year. B.C. has made major strides in improving its practices. I was quoted by Mr. Higginbotham earlier. That's an accurate quote.

I have not done comparisons with other jurisdictions around the world. I'm not particularly comfortable saying that we are the best in the world in our practices, but I am sure that the kinds of things Kim Pollack and the IWA people have told you are accurate. We are very good at the practices that we practice.

On the other hand, we have a landscape that is going to require very good practices. It's all public jurisdiction. It's not fragmented. Much of it is old growth. It is one of the last places in the world where we have these undeveloped watersheds, where we have an abundance of grizzly bears, marbled murrelet species, tourism opportunities.

It's not fair to compare our practices with the practices in South Carolina or North Carolina, which I don't know at all. I understand that these are areas that are being cut for the second and third times and that are highly fragmented, where they don't have any grizzly bears to worry about.

The world is expecting us to perform to a very high standard because of the richness we have. In my view, that's partly why I say we have some distance to go yet. It is largely related to this very large land base under one ownership, which is not fragmented by jurisdictions, and the resources. A professional forester is the best person to implement a plan that says, here's how we conduct forestry and protect grizzly bears. But he needs to understand what the objectives are. How many grizzly bears do we want to protect and how are we going to do that?

For me, those are things that are going to come out of regional land use plans. We have started the process in B.C. It is not implemented at this point. I think there's a critical need for implementing what we call higher level plans that set objectives and provide direction at the operational level. That's where we still have room to go.

• 1150

Mr. Yvon Godin: We hear about old growth and second growth and everything. Just for my information, do grizzly bears not go into second growth? Don't they like those trees?

Mr. Keith Moore: Sure, they... I don't want to get into a debate about—

Mr. Yvon Godin: We can talk about it afterwards, but it's just for my own information.

Mr. Keith Moore: I'm saying that the world is expecting us to protect these things that they are interested in, which they no longer have in the jurisdictions where they live.

Mr. Patrick Moore: Could I just make one very quick point, Mr. Chair?

The Chair: Dr. Moore.

Mr. Patrick Moore: This thing about grizzly bears has been completely distorted. Grizzly bears prefer open areas to treed areas and they like—

Mr. Yvon Godin: They like blueberries instead of trees too...

Mr. Patrick Moore: Grizzly bears go through the trees to get to the river to eat the salmon. That's why they go into the trees. Most of the time grizzly bears are not in trees. They don't nest in trees like black bears do. They nest mostly in rocks and they like scree slopes—which are out in the open—where they can find food. Most of the time you'll find them in the open, so this myth about grizzly bears needing old-growth trees is nothing more than that.

The Chair: That's an excellent point.

You've all been very cooperative. Our witnesses clearly have demonstrated that we need a whole day with them, but let's call this the beginning of a dialogue. I'd like to thank you all.

Without any break, I'd like to invite the B.C. Business Council to the table, and we'll get right to work.

In view of the pressure of time, we're going to get started right away. The tapes are rolling, so we'll be able to start, and we'll have a full transcript of the presentation that we appreciate will be made by the Business Council of British Columbia. With us we have Jerry Lampert, president and CEO, and Jock Finlayson, vice-president, policy.

We appreciate you taking some time to visit with us this morning. I saw you in the room, so you've been here for a little while and you know that we're focusing on the international perceptions of forest practices, in B.C. only initially. We're looking at this from a national point of view, but we're starting here in B.C. We invite you to spend a few minutes introducing your points of view.

Mr. Jerry Lampert (President and CEO, Business Council of British Columbia): Thank you, Mr. Chair. My name is Jerry Lampert and I'm president of the Business Council of British Columbia. With me today is Jock Finlayson, who serves as the Business Council's vice-president of policy as well as our chief economist.

By way of background, very quickly, the Business Council of British Columbia is an association representing large and medium-sized businesses in the province. We have been in existence since 1966. Our 165 members are drawn from all major sectors of the economy. The companies and associations that are part of the Business Council account for approximately one quarter of all jobs in the province. Most of the major forest companies active in B.C. belong to or are affiliated with the Business Council.

We are pleased to be here today before the Standing Committee on Natural Resources. We are pleased that the committee has embarked on an inquiry into Canadian forest management practices in the context of evolving global trade agreements and a changing international marketplace.

I should emphasize that I am not an expert on the forest industry nor on forest practices. However, the Business Council of British Columbia feels that it is important for your committee to continue its examination of the current state of forest management, both in B.C. and across the country.

We are confident that a careful review will show that Canadian forest practices have substantially improved over the last decade or so, contrary to the claims made by many of the industry's critics here and abroad.

• 1155

The importance of forestry to the Canadian and British Columbian economies can scarcely be overstated. You may have heard some of this same information in prior presentations. Not only is Canada the world's leading exporter of forest products, the forest industry is also the country's biggest net generator of export earnings. In 1997, forest product exports exceeded imports by some $34 billion. In the same year, the value of total Canadian forest industry production reached $56.5 billion, with wood products accounting for $27 billion of this and pulp and paper products for $29.5 billion.

Taking into consideration both direct and indirect economic effects, the forest industry provides employment for almost one million Canadians. It is also the primary engine of economic activity for some 350 communities across the country—and that fact should not be lost. The people employed in the forest industry earn incomes that are more than 50% higher than the national average, incomes that allow them to purchase a wide range of goods and services in their local communities—as well as to pay taxes to all levels of government.

From an economic standpoint, forestry of course looms even larger here in British Columbia. It accounts for almost half of the value of B.C.'s manufacturing shipments and for more than half of the province's exports. Close to 100,000 British Columbians work directly in the various segments that make up the forest products industry. On top of this, at least another 175,000 jobs in other sectors of the provincial economy depend on the forest industry.

The annual value of industry output in the past two years has been in the range of $16 billion to $17 billion, although this figure will rise as economic recovery gets under way in Japan and other Asian markets. We've attached to this submission a number of tables and charts that present additional detail on the B.C. forest industry, and we would refer you to them.

The forest industry has what economists call a significant “positive multiplier”. In other words, it helps to drive economic activity in other sectors. There are three principal reasons why this is the case. First, most of our forest products are exported, meaning that the industry provides an externally generated source of income. Second, as noted already, the workers employed in the industry earn above-average incomes. Third, forest companies source many of their business inputs within the province, thereby creating demand for producers of many other goods and services.

Once all of these positive multiplier effects are taken into account, it turns out that the forest industry is responsible for up to one-fifth of British Columbia's gross domestic product. It also provides more than 20% of the B.C. government's own-source revenues. These estimates come from a report prepared by the Forest Alliance of British Columbia, which just appeared before you, and the Vancouver Board of Trade. We encourage the committee to obtain and closely examine this report before concluding its work.

Last year, we in the Business Council published our own analysis of the economic contribution of British Columbia's resource industries, including forestry. Entitled “B.C.'s Resource Industries—They Still Matter”, this report highlights the continuing vital role played by forestry and other resource-based industries in underpinning B.C.'s prosperity.

We decided to prepare this report in order to counter the often-heard but erroneous argument that forestry and mining are “sunset” industries and that B.C.'s economy has diversified to the point where it no longer needs a vibrant, competitive, resource-based sector. Although some diversification is indeed occurring, the evidence reveals that forestry and other resource sectors still make an enormous contribution to the province's economic well-being, even in the current environment of diminished market demand and low prices for many commodity products.

You are no doubt aware that the forest industry in B.C. has recently been under severe economic pressure due to poor prices for some forest products, notably pulp, growing foreign competition, and high logging costs and other costs here at home. This underscores the need for quick action to restore the financial health of the province's largest industry and to establish conditions that will allow it to enjoy a prosperous and sustainable future. The current economic downturn affecting some parts of the industry most emphatically does not justify treating forestry as a sunset industry.

I now want to turn the microphone over to Jock Finlayson.

Mr. Jock Finlayson (Vice-President, Policy, Business Council of British Columbia): Thank you.

Forestry in British Columbia is not a static industry, contrary to what you sometimes hear. There has been a lot of innovation in forest practices, in government policies influencing the industry, and in the twin areas of product and market development. Looking ahead, we believe that the goal must be to position British Columbia's forest sector to be a world leader in the new millennium.

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Other witnesses have shared with the committee more detail on forest management and marketing issues, but you should know that business leaders throughout our province, including those who are out in the forest industry, have taken note of the significant evolution in forest management practices in the past decade.

Among the highlights and key developments in this trend have been the introduction of the Forest Practices Code in B.C. in 1995; the implementation of the provincial parks and protected areas strategy; the establishment of comprehensive land use planning processes in most of British Columbia; some progress in the development of standards for sustainable forest management; and the use of what was previously considered to be wood waste to produce high-end value-added wood products.

Let me elaborate on a few of these points. Recently an independent review found that B.C. forest practices were among the toughest in the world. I would remind you this runs counter to the message disseminated by certain environmental groups, mostly based and funded outside of British Columbia, whose unstated but increasingly obvious goal is to put an end to virtually all commercial forest industry activity in this province.

As part of the B.C. protected area strategy, our province has set a target to protect 12% of the province's land base. Since 1992, the percentage of protected land has risen from a little over 6% to 11% today. This compares with just 6% of the Canadian land base that is protected, 4.7% in the United States, 3% in Sweden, which is often seen as a leader in environmental policy, and well under 1% in Germany. B.C. now has more than 300 parks and protected areas, and one recently designated protected area, the Muskwa-Kechika, is actually larger in size than the country of Switzerland. So we have achieved a great deal in this area in our province.

Moreover, according to the provincial government's 1998 state of the environment report, most indicators show that the representativeness of the province's ecosystem diversity has substantially improved in the past decade. Of the 100 terrestrial or land-based ecological regions that have been identified in British Columbia, the number in which more than 12% of the land is now protected has doubled from 16 to 30. The number in which between 6% and 12% of the land is protected has increased from 12 to 17. At the same time, the number of ecological regions in which 1% or less of the land has been protected has diminished sharply.

The committee should be aware that an extensive system of regional land use planning has been implemented and continues to be implemented in British Columbia. Comprehensive land use plans have been established, or are in the process of being developed now, for more than 80% of B.C. These plans are the result of a great deal of often painful stakeholder input by people who actually live in these affected regions. Fundamentally, most people in our province believe that local communities and regions should play a key role in land use decision-making. Efforts by foreign governments, special interest groups, and outside lobbyists to dictate how our land in B.C. will be managed and used should be firmly resisted by all of us, including the federal government.

As you've heard, various initiatives are underway within the forest industry to demonstrate to customers and other stakeholders that a high level of forest management and environmental performance is being achieved. Certification programs have a role to play in this regard. A multi-stakeholder technical committee of the Canadian Standards Association has developed a national sustainable forest management standard based on the latest ISO environmental management system created by the International Standards Association.

A recent survey by the Canadian Sustainable Forestry Certification Coalition found that more than 30 companies with 42 operations across Canada intend to certify some 72 million hectares under their management by the end of 2003. This represents 60% of Canada's 120 million hectares of managed forest land. Most of this land will be certified to the latest ISO standards.

In sum, we believe that British Columbia is a world leader in providing a balanced approach to forest management. British Columbians recognize that a number of sometimes competing values must be factored into decisions on how to use our land and resource base. As part of this process, there are legitimate non-commercial values that have to be considered. However, it should not be overlooked that less than one-quarter of the entire B.C. land mass has been designated for commercial forestry, and only a portion of this will ever be logged. Within the land areas that have been designated for commercial use, many will be left untouched because of rules relating to riparian zones, biodiversity corridors, and other environmentally sensitive issues.

Forestry in British Columbia, like our overall economy, is in transition. New forest practices legislation is in place—the industry is still adapting to that—and environmental concerns are receiving greater attention in forestry management. While original old-growth forests will continue to be a key source of timber for many years to come, increasingly over time British Columbia will be drawing on its expanding range of second-growth forests.

• 1205

Today, the Canadian and B.C. forest industries face a well-organized campaign by environmental activist groups, who are trying to limit or even end our access to foreign markets for both solid wood and pulp products. Much of this activity today has been concentrated in Europe, but recently these groups have stepped up their efforts in the United States as well. Although to date British Columbia's coastal forests have been the main focus of this environmental campaign, I think it's important to emphasize that ultimately all industrial forestry in Canada is at risk.

The Canadian government, together with our provinces, the industry, and its employees and suppliers must be vigilant in promoting the Canadian forest sector in foreign markets and active in countering the distorted messages being put out by environmental organizations and their allies. To this end, several strategies are worth considering.

First, at the global level, Canada should continue efforts to forge new international agreements and conventions that address issues related to sustainable forest management.

Second, the Government of Canada needs to work closely with the industry to devise a sensible approach to the important issue of certification. For Canada, a key goal must be to ensure that certification schemes do not become a back-door route for the introduction of protectionist trade restrictions.

Third, Canada should be mounting more international trade missions to promote our forest products, in both long-established and newer markets. This is an industry that is the largest contributor to Canada's trade balance, and it deserves more support and priority in Ottawa.

Fourth, other ways must be found to present a more balanced and accurate picture of Canadian forest practices abroad. As noted in the submission by the Council of Forest Industries to this committee, this could entail locating dedicated Canadian forest trade offices in key foreign markets and arranging speaking tours for Canadian representatives in Europe, Asia, and the United States. No doubt there are other ideas that could be discussed as well. In this regard, additional federal government financial support will be required to move forward with initiatives that make a difference.

Finally, Canada should be making it clear to our trading partners that we will use our NAFTA, World Trade Organization, and other international trade agreements to protect Canada's rights and hard-won market access in the forest sector, in the event that governments in other countries respond to environmentalists' pressures by seeking to impose new barriers on imports of Canadian forest products.

Mr. Chair, we thank the committee for the opportunity to appear.

The Chair: Thank you both for those remarks.

We'll start the questions with John Duncan.

Mr. John Duncan: I'd like to congratulate both speakers for taking the time they took and for not mentioning the Softwood Lumber Agreement once.

The Chair: Do you feel you have to bring it in?

Mr. John Duncan: There's been a suggestion that the concern we currently hold about the Softwood Lumber Agreement will be completely replaced by concerns about a total restriction of market access or a very complete restriction of market access based on old growth, as opposed to a softwood lumber quota. That is the concern that was put on the table here yesterday. It has implications across Canada, and it's certainly huge for British Columbia. I just thought I would mention that because it ties into the overall presentation you made.

We heard many of your recommendations, in terms of access to market and markets, from others who have been before the committee. One of the things that was said to us earlier today was that we have to get our forest industry to think like retailers rather than like wholesalers. They have to approach this whole exercise in a very different way. They have to advertise and have positive, almost folk hero publicity. You may have been here for a portion of that presentation. Perhaps you can give us your opinion on that, and how you think it would be received by some of your forest industry membership.

Mr. Jerry Lampert: There are changes taking place, particularly at the leadership level in some of the largest forest companies in this province. I think that leadership is looking for new ways in which to go about doing their business.

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I was recently up at the Northern Forest Products Association annual meeting, and they had a panel of CEOs of some of the major companies, all of whom I think are looking at things in new and different ways.

I know, for instance, that the CEO of Canfor, David Emerson, relatively new to the business, has opened some very interesting opportunities with Home Depot; Home Depot was just mentioned here. I think there are new ways being considered.

In answer to your question, I would say anything we would do to encourage that, to be a voice beside all of that happening, would in all likelihood occur.

Jock, you may want to answer.

Mr. Jock Finlayson: I guess, like any industry, the forest industry in our province and in our country has no alternative but to listen to its customers. If you don't, it's pretty hard to succeed in any product line, and it presents a big challenge for all of our resource producers, but certainly for forestry, which have not had the retail mindset traditionally that you alluded to.

Today in British Columbia, of course, our industry is in a financial crisis, so it's difficult for the decision-makers to grapple with a long-run strategic threat to the industry that has already manifested itself, when in fact they are concentrating on trying to survive for the next 12 or 18 months. Although the situation appears to now have bottomed out and is slightly improving, it has been the worst economic and financial crisis in 50 years in the B.C. forest products industry. So the companies are striving to survive and live to fight another day.

However, the marketplace is changing, and I don't see any alternative but for the companies to change with it, and the trend appears to be toward some kind of... there are a variety of certification models out there of sustainable forest practices. We certainly aren't experts on those or on which one is appropriate.

We were in attendance at the PriceWaterhouseCoopers forestry conference that a previous speaker alluded to, and a number of speakers suggested that third-party certification rather than industry certification itself would likely in the long run be the only alternative. So the question then becomes, who are the third parties? If you're looking to Greenpeace to certify that your practices are sustainable, you might as well shut the doors and get on with another line of work, because they don't like trees being harvested.

If there's a credible third-party certification scheme that isn't out to basically shut down the B.C. forest products industry, maybe that would work better for our industry. That appears to be the trend that's out there in the marketplace.

The Chair: You were sharing your time, I think, John and Werner. Do you want to take the other half of the time?

Mr. Werner Schmidt: Thank you, Mr. Chairman, and thank you, gentlemen, for appearing. It's really very significant that you're here. You provide the umbrella part of this operation.

I'd like to zero in on a particular one of those four elements that you talked about at the end of your presentation, and it has to do with trade missions. In the past, trade missions have been missions going from here to there. Would it be advisable to turn that around, because the customers are the ones who have to actually see and be persuaded that what's happening here is what's in their best interests?

It's all very well for us to go tell them the story out there, and of course we're going to tell the best story, but that's what we should do, and I think that's great, and our trade missions have been very successful in doing that. So I wonder, to obviate or to work against some of what Patrick Moore told us were lies that some of these environmentalists are perpetrating, how best to deal with that?

Mr. Jerry Lampert: I think the answer to your question is yes. I think it's a combination of effort here, both in terms of continuing the more traditional trade mission... It's been suggested that, having seen a lot of the Japanese market drift away because of their own crisis, and hoping to get that market back, it's not assured that we're going to regain that market, because what's happened, and you may have heard this, is Swedish-Scandinavian interests have moved in. So it's going to take a whole new marketing effort, and it might be reflected in something Mr. Duncan suggested, a more retail approach, but the point is we still have to do that.

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However, I know that Forest Alliance and other groups here have been talking about the possibility of doing marketing by bringing people here to see exactly what we're up to in our forests, and we would support that kind of initiative.

Mr. Jock Finlayson: I think the point is very well taken. In fact, it's probably more important to bring foreign buyers into Canada than it might be for Canadian sellers to be travelling abroad, given the particular problems we're having in this industry, which are likely to grow. The plea we would make in that connection is—you know, forestry is an industry that falls under provincial jurisdiction. We're well aware, sometimes painfully aware, of that here in British Columbia. But the fact is, from a national point of view, it's a key economic engine. I mean, you're talking about an industry that produces almost $60 billion worth of output a year and is very important right across Canada, not just in B.C.

So the federal government, I think, in light of the importance of that, should attach a higher priority in its own planning and decision-making and resource allocation to deal with these problems. It's very hard for individual provinces to do it; they are busy managing the resource base and they don't have the fiscal capacity. So a stepped-up national effort to really expand trade missions, two-way trade missions, and also to assist in communicating a more balanced view of what's going on in Canada with forestry, I think, is an urgent priority.

Mr. Werner Schmidt: The expansion of that question is, this is a British Columbia effort at this point and you represent the B.C. Business Council. But forestry is not something limited to British Columbia. It exists in a variety of other provinces right across Canada. So the question I would have deals with that. To what degree is your council associated with or liaising with or working together with these other provinces and their respective business councils to do the kind of thing we're talking about? The kind of thing that's happening here, the practices that are going on here in forestry, are not that different from the practices that are going on elsewhere in Canada. It just so happens that somebody has been zeroing in on this province, but the problem is a national one.

Mr. Jerry Lampert: Yes. In terms of forestry industry associations, there is extensive liaison. In other words, the Council of Forest Industries, the alliance here, would be working with similar groups in other parts of the country. As far as the business council goes, we do liaise with national associations that have broad public policy interests, including interests in this area. So that sort of thing goes on.

There are only actually three other business councils in the country—one in Manitoba, le Conseil du patronat in Quebec, and the national. But we do share our information and that sort of thing.

Mr. Jock Finlayson: Yes, we don't purport to speak for the forest industry as such. Our membership is very diverse. Because of the importance of that industry to this province, we have a keen interest in its economic health and its long-run future. But one of the difficulties we have dealing as a country with this challenge is the industry is organized in a somewhat fragmented way.

You do have the Canadian Pulp and Paper Association, which does represent that part of the industry. But in the case of the solid wood component, which is the main concern of this particular trip out here by your committee, there isn't really a strong national organization speaking for the Canadian solid wood industry collectively. You have a series of provincial organizations, of which we have one in B.C., and there's one in Quebec and so on.

So compared to the banking or chemical or mining industries, where you have very strong national groups that pull together the industry from across Canada, that does not exist on the solid wood side of the forest product industry in Canada.

The Chair: Thank you.

We'll take short questions from Alex and Yvon, and then we're going to adjourn for the day.

Mr. Alex Shepherd: Just to suggest, I suspect this is the logical outcome of a lot of provinces sitting around and saying they want more control over the natural resource sector. The department of natural resources in Ottawa has been cut in half in the last budget, mainly because of that process. It's time to think about whether you want to enhance some of these responsibilities of the federal government.

It seems to me you have an industry in financial crisis. It seems to me if I were a strategic planner on the other side, it would be a good time to drive the nail in the coffin.

You talked about the fragmentation and you said you only represent the forestry companies to a certain extent, but you have many other members in your organization. It seems to me that what's required here is a marshalling of resources to deal with this issue, and some of those other companies that are in your organization are going to be negatively affected by the loss of this business activity.

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It seems to me an organization like yourself could do the whole issue a lot of good if you could maybe go into your membership base and say, look, this isn't just about treaties and forests, it's about business activity in British Columbia; how can we start putting some bucks together and maybe support this drive for more of an international campaign to enhance forestry activities? Maybe in this way you could reverse the tide that seems to be going against you.

Mr. Jerry Lampert: I have just one comment on what you had to say about opponents maybe taking advantage of the situation here, the current economic situation within the forest industry, and driving that final nail. It's kind of interesting. My sense of it is that many of the leading opposition groups have been very wary of pushing in that direction because they know that people in small communities are hurting, and I think they realize there would be quite a significant backlash. By the same token, I know they were here yesterday; they continue on specific matters at specific times to have a presence, but concerning the big final push from the perspective in which you presented it, I think they know they have to be cautious. There would be quite a public backlash in this province because of the reality that's out there.

As far as the diverse membership that we represent is concerned, I can tell you—and these are interests that range from communications to banking, financial institutions to the professions—in this province they are very sensitive and sensitized to issues around forestry. I think they are quite receptive to some new ideas on how we can get forestry back up and fully functioning in this province. I'm not suggesting, though, that they're willing in a corporate way to go into their own pockets to do that, but I think they would give a lot of comfort and support in other ways.

Jock, I don't know if you can answer that.

Mr. Jock Finlayson: I think anybody who does business in B.C. broadly—if you're in the banking business or the retail business. They're aware, painfully aware at the moment, of the importance of the forest sector. It's not just the people employed in the forest industry and in the communities where the facilities are located. It's a much broader industry, and in fact one of the fundamental reasons our economy's going so poorly is the whole B.C. economy has been contaminated by the financial crisis in forestry, including the lower mainland area.

Sure, not everybody's affected in the same way or to the same degree. But it's akin to taking the auto manufacturing and parts industry in southern Ontario and putting that through the wringer in the way our forest products industry is being put through the wringer. You would see the effect rippling through the communities and the businesses and the suppliers right across that region of Canada's heartland.

Without the forest industry this province will become a have-not province overnight—if the forest industry disappears. Yes, we're diversifying very slowly away from our resource sector, and that's a good thing, but it's a very long-term process. As soon as you get out of the Vancouver area you very quickly see that the resource sector, which includes agriculture and mining and fishing and oil and gas as well, is still the economic backbone of non-urbanized British Columbia.

Microsoft and Northern Telecom are not going to be putting operations in Bella Coola, Burns Lake, Williams Lake, and Prince George, as wonderful as those communities are. Those communities are going to continue to depend on the land and resource base they have traditionally relied upon for prosperity, even as they may be very slowly diversifying. That's an economic reality that is ignored by some, but cannot be ignored by people charged with making policy decisions on the future of these resource sectors.

The Chair: Thank you.

A final word to you, Yvon.

[Translation]

Mr. Yvon Godin: It's more of a comment than a question.

First of all, I want to thank you for being here today. Members of Parliament from other regions of the country have made the trip to meet with you here today in British Columbia. I am from Northeastern New Brunswick, and I can tell you that the New Brunswick forest is nothing like the one here in British Columbia. Compared to yours, our trees look more like toothpicks, if you ask me.

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What's important is to come and see for oneself what has happened and the way things are headed. There is work to be done in that area, because customers have to come and see for themselves. It's not just a matter of going to see the customers. Our visit has heightened our awareness in many areas.

Even the representatives of the IWA said that they had been part of delegations that came to visit the British Columbia forest and that they had noticed a considerable change in attitude when people from abroad saw the situation for themselves, because they had not been told the true story. It's the same thing with us. What you hear and what you see for yourself are two completely different things. So, this is an important process. I think enough questions have already been asked. That's why I preferred to just make a couple of comments. Thank you.

[English]

Mr. Jerry Lampert: I agree with what you have to say. I think the role of the IWA and other union groups involved in the forest sector is very important to the peace, and they should be part of these representations. I think because of what's happened here in the last couple of years, there has been a more pragmatic approach taken by IWA and other union leadership around these forest issues, and I see that as a positive development. They can be very helpful in all of this.

The Chair: On behalf of the committee, I would like to thank our last two witnesses, the witnesses who appeared this morning and yesterday, and those who met us informally in the Williams Lake and Bella Coola neighbourhoods. You've helped us a lot.

I want to thank members for their participation and cooperation. We look forward to seeing you back in Ottawa. We'll work toward an interim report. I think we would like to do that, even though we're going to continue this. I think it's appropriate that we say something for the record after this first phase.

So with that, we're adjourned.