Sorting out the conflicts

JANE O’HARA February 3 1986

Sorting out the conflicts

JANE O’HARA February 3 1986

Sorting out the conflicts

By the urgent and secretive activity that surrounded it, the Victoria legislature building seemed more like a fortress under siege last week than the stately home of democracy in British Columbia. Late Tuesday night Premier William Bennett conferred with senior aides in closed-door strategy sessions. One veteran cabinet member, Forests Minister Thomas Waterland, had already resigned amid conflict-of-interest charges. Another, En-

ergy Minister Stephen Rogers, was under attack on the same grounds. For two days, using side and rear exits to the legislature, Bennett and Rogers managed to avoid questions. But pressure from the opposition New Democratic Party and the press was clearly building. Then, emerging from a Wednesday morning cabinet meeting, the premier announced a new set of conflict-of-interest guidelines—but he said he would not ask for Rogers’s resignation. Said Bennett: “The minister of energy is not in a conflict position'. If anyone has any other allegations, let them make them public.”

Waterland, 52, a cabinet minister for 10 years, admitted having bought $20,000 worth of units in a pulp mill consortium, Western Pulp Limited Partnership (WP). His 1983 investment entitled him to an $18,000 tax deferment, spread over five years, and it was convertible into shares in three B.C. companies active in the forest in-

dustry. Those same companies control Western Forest Products, which owns disputed timber rights—issued by Waterland’s department—on Lyell Island, in the South Moresby archipelago north of Vancouver Island, where a controversial logging operation resumed last week. In turn, the consortium’s pulp mills rely on wood supplied from South Moresby. All that prompted Vancouver Sun columnist Vaughn Palmer to write: “The minister of for-

ests has an interest in a forest company, a firm that itself has an interest in one of the most sensitive land-use questions in the province’s history. Dumb. Sackful-of-hammers dumb.” Rogers, heir to a family fortune estimated at $20 million to $50 million, had invested $100,000 in the same tax-shelter scheme. Like his colleague, he sat on the cabinet’s environment and land-use committee, which recommends where timber rights will be issued and to whom.

The committee was part of the decision-making process that allowed Western Forest Products—a WP partner—to log Lyell Island. Moreover, as energy minister,

Rogers signed a cabinet

document in December giving cheaper electrical rates to a pulp mill belonging to WP. Waterland personally owned his investment in WP, and it was publicly disclosed in financial statements as required by provincial laws. Rogers’s interests in WP, although held indirectly through a holding company, Montgomery Investments Ltd., were disclosed under the same act. His connection with WP surfaced only when his name was found on a list of inves-

tors on file in Victoria. But both ministers denied any conflict of interest.

Bennett’s Wednesday announcement was an exercise in damage control. His objective: to move the scandal off the front pages and ensure that the revelations did not become an issue in the next provincial election, expected this year. But the ramifications of the incident went far beyond the confines of Victoria’s comfortable cabinet chambers.

The controversy also affected the government’s wilderness advisory committee, an eight-member panel established on Oct. 18 to gather public testimony and advise the cabinet on environmental hot spots around the province, including South Moresby. When the list of WP investors was published last week, committee chairman Bryan Williams, a Vancouver lawyer, was among them. Williams said that he divested his interests in WP on Dec. 9. But that was almost three weeks after joining the committee. Said Haida chief Miles Richardson: “The whole thing stinks. There should be a full investigation.”

To defuse the controversy, Bennett announced a set of tougher conflict-ofinterest guidelines for all MLAs and senior bureaucrats. The rules, to be introduced when the legislature resumes sitting, will give ministers and senior

civil servants the option of placing fiI nancial interests in a blind trust or of meeting strict new disclosure rules. But the premier insisted that Rogers, 43, a separated father of two, was “not in a position of conflict.” Declared NDP Leader Robert Skelly: “Obviously Rogers wields more clout in cabinet because of his powerful connections. I mean old money. Bennett doesn’t have the power to dismiss Rogers without suffering politically.” At week’s end, Rogers sued Skelly for libel. But Rogers’s presence in cabinet may face another threat. The attorney general’s office has begun an inquiry to determine whether he should be charged for failing to disclose his WP investment.

Neither Rogers nor Waterland was the first Bennett minister embroiled in scandal. In December, Robert McLelland, minister of small-business development, testified at a trial involving an escort service and alleged prostitutionrelated offences. McLelland was called

as a witness after a police investigation discovered a $130 charge from the escort service on the minister’s Visa bill. He did not resign.

Meanwhile, the logging operation resumed on Lyell Island. Since October, 72 Haida Indians have been charged with defying a court order banning interference with forestry operations. The Haida have been protesting logging since 1974 because they regard the area as their ancestral land. The tribe filed its land claim with the federal government in 1980—one of about 27 bands with claims that cover two-thirds of British Columbia. The Haida are supported by conservationists who want South Moresby preserved as a plant and animal refuge.

But Western Forest Products owns cutting rights to 20 per cent of South Moresby’s forests and 600-year-old stands of virgin cedar and spruce. A logging ban, company spokesmen claim, would result in 1,100 layoffs and a $47-million loss to the provincial economy over the next 45 years. Last week, when the logging trucks returned after five weeks, 14 Haidas moved aside and let them pass, averting a confrontation. Richardson is scheduled to meet government officials next week to seek a way out of the deadlock.

One option under discussion: a Parks Canada proposal to incorporate the Haida’s land j claim into a national park. For g its part, the RC. government £ has deferred any decision about y the fate of Moresby until it re5 ceives the wilderness committee report, due Feb. 15. But the committee faced a formidable task. Said vice-chairman Derrick Sewell, a University of Victoria professor specializing in resource issues: “Some would call it mission impossible.”

The intensity of the debate has been mirrored in the committee’s public hearings. There the conservationists are facing residents who rely on the forest industry for their livelihood. Recalling the panel’s recent visit to the Moresby island town of Sandspit, logger Robert Smith, who publishes a local newsletter known as the Red Neck News, said: “There were only two speakers who spoke for the environmentalists. We booed the both of them out of the hall.” At week’s end, the divided province was locked in a social—and fiercely emotional—debate that the Bennett government had not yet confronted—and may have great difficulty resolving.


-JANE O’HARA with DIANE LUCKOW in Vancouver