Legislative Assembly of Ontario

MINISTRY OF ECONOMIC DEVELOPMENT, TRADE AND TOURISM

CONTENTS

Wednesday 16 October 1996

Ministry of Economic Development, Trade and Tourism

Hon William Saunderson

STANDING COMMITTEE ON ESTIMATES

Chair / Président: Curling, Alvin (Scarborough North / -Nord L)

Vice-Chair / Vice-Président: Cordiano, Joseph (Lawrence L)

*Mr TobyBarrett (Norfolk PC)

*Mr GillesBisson (Cochrane South / -Sud ND)

*Mr JimBrown (Scarborough West / -Ouest PC)

*Mr Michael A. Brown (Algoma-Manitoulin L)

*Mr John C. Cleary (Cornwall L)

Mr TonyClement (Brampton South / -Sud PC)

Mr JosephCordiano (Lawrence L)

Mr AlvinCurling (Scarborough North / -Nord L)

*Mr MorleyKells (Etobicoke-Lakeshore PC)

Mr PeterKormos (Welland-Thorold ND)

Mr E.J. DouglasRollins (Quinte PC)

Mrs LillianRoss (Hamilton West / -Ouest PC)

*Mr FrankSheehan (Lincoln PC)

*Mr WayneWettlaufer (Kitchener PC)

*In attendance /présents

Substitutions present /Membres remplaçants présents:

Mr JohnHastings (Etobicoke-Rexdale PC) for Mr Clement

Mr Jean-MarcLalonde (Prescott and Russell/Prescott et Russell L) for Mr Cordiano

Mr TonyMartin (Sault Ste Marie ND) for Mr Kormos

Mr BertJohnson (Perth PC) for Mr Rollins

Mr BillVankoughnet (Frontenac-Addington PC) for Mrs Ross

Clerk / Greffièr: Mr Franco Carrozza

Staff / Personnel: Mr Steve Poelking, research officer, Legislative Research Service

The committee met at 1539 in committee room 2.

MINISTRY OF ECONOMIC DEVELOPMENT, TRADE AND TOURISM

The Acting Chair (Mr John Cleary): Pursuant to today's motion by the House giving us permission to postpone the review of the Ministry of Health estimates, we will begin with the estimates of the Ministry of Economic Development, Trade and Tourism for 15 hours. I welcome the minister and call vote 901. Minister, I guess it's up to you to make your presentation now.

Mr Wayne Wettlaufer (Kitchener): Before the minister gets started, I wonder if I could call a point of order. This is very interesting to the minister as well. The estimates were presented to the Clerk a week ago by the ministry and some of us just received the estimates now; some received them 10 minutes ago. There are those of us on the estimates committee who really get off looking at figures -- I'm one of them -- and I find it totally inappropriate that we just got the figures now.

Clerk of the Committee (Mr Franco Carrozza): Mr Wettlaufer, the Clerk did not receive the estimates last week. They were given to the clerk of the committee, Mr Decker, when they first began, which was quite a while back, a few months ago. Those were issued that date. I do not have any other estimates book for you and I apologize.

Mr Wettlaufer: Thank you.

Mr Michael A. Brown (Algoma-Manitoulin): On that same point of order: These estimates were tabled under the legislative guidelines in the Legislature at the appropriate time?

Clerk of the Committee: Yes.

Mr Michael Brown: So all members would know that?

Clerk of the Committee: Yes.

The Acting Chair: Okay, I guess we're ready to start.

Hon William Saunderson (Minister of Economic Development, Trade and Tourism): It is my pleasure to be with you today. We're here to begin the consideration of the 1996-97 estimates for the Ministry of Economic Development, Trade and Tourism. During the next 15 hours in this committee we will examine the work of this ministry since I became minister in June 1995.

Everyone on this committee shares the desire to take actions that will strengthen the Ontario economy and promote job creation. We may differ in how to achieve our goals, but there's no doubt that we all want a prosperous economy and sustained economic growth. The Ministry of Economic Development, Trade and Tourism is taking clear steps to help Ontarians achieve long-term economic growth and job creation.

I believe the best way to invest in our future is to create a positive business climate that attracts new entrepreneurial activity, investment, research and development, training and job creation. That belief is what distinguishes this government from its predecessors. We know that the private sector creates jobs and fuels the economy in this province, in this country and in leading economic jurisdictions around the world.

In June 1995 the people of Ontario elected us to get the province moving again and to help clear the path for the private sector. Years of heavy-handed government policies worsened the business climate, increased taxes on companies and people, and left us with one of the poorest job growth records in North America.

Out government acted immediately to turn the situation around. One of our top priorities was to show that Ontario welcomed new investment, new businesses and economic growth. We did this by taking concrete steps to remove barriers to job creation. We repealed the former government's Bill 40, which for years had sent the wrong message to business about Ontario's investment climate. We reduced workers' compensation premiums. We effectively eliminated payroll taxes for smaller businesses and reduced them for other companies. We restored fiscal responsibility to the province by making deep cuts in public spending, reducing personal income tax rates and pledging to balance the provincial budget by the end of our first term in office.

Less than a year and a half later, our government's actions have contributed to economic renewal in Ontario. Obviously I'm disappointed with the September employment data which showed a decline of 35,000 jobs in Ontario following strong gains in July and August. However, I am encouraged by the overall trend in employment. Since July 1995, 105,000 net new jobs have been created in Ontario, and that's in comparison with the previous government, which had 10,000 fewer jobs at the end of its five years.

More importantly, 92,000 of these jobs have been in the private sector. This demonstrates that our government's economic approach is working. We are stimulating job creation by increasing business confidence, getting the deficit under control, cutting taxes and removing barriers to investment. Business investment in Ontario is expected to rise by almost 12% this year, far ahead of the rest of Canada.

Ontario is leading the way in the national housing recovery. Our housing starts rose by 14.2% in the second quarter of this year. In August, Ontario's inflation rate was 1.2%, the ninth consecutive month that it has remained below 2%.

Ontario is poised to grow by 3% annually during the next five years, more quickly than the national average and faster than any of the G-7 industrialized nations. Ontario will also outperform all of its US Great Lakes states competitors next year. Ohio and Minnesota are our closest competitors at 2.8%, and New York is expected to grow at a rate of only 1.7%.

Most of Ontario's growth continues to be generated by machinery and equipment investment and by exports. Together, they accounted for almost 80% of gross domestic product expansion in 1995. Last year, exports accounted for nearly 45% of Ontario's gross domestic product. That is a better ratio of exports to GDP than in any other Canadian province or in any G-7 country.

The success of our approach is reflected in the fact that this summer the Conference Board of Canada reported that business confidence was rising considerably in Ontario, which would receive the bulk of new investment in Canada. Ontario's improving investment climate is supported by stable and historically low interest rates. Our overall economic trend is positive and provides us with much room to position Ontario as one of the best places in the world to live, work, invest and travel.

Premier Harris and other ministers and myself have made consistent efforts to inform international investors about our work to improve the business climate. We are finding that Ontario's reputation is being restored. Investors are telling us they see tremendous value in Ontario's strengths, which are becoming our selling features.

We have a highly skilled and productive workforce.

Through NAFTA, we provide a strategic point of entry to an integrated interprovincial and international trade market. More than 120 million North American consumers live within a day's drive of Ontario. With a combined personal purchasing power of $3 trillion, they constitute one of the biggest and most affluent markets in the world.

We have strong international trade connections and great success in penetrating export markets. Exports account for about 45% of our total output of goods and services. Ontario is the third-largest trading partner of the United States behind Canada as a whole and Japan.

Ontario is Canada's leading manufacturing province, accounting for 53% of national manufacturing shipments last year. The country's top 10 high-technology companies, in terms of revenues, are all based in Ontario. Graduates from our high-tech university programs are highly skilled and very much sought after by the private sector.

We account for more than 40% of Canada's gross domestic product and have a bigger economy than Michigan, Massachusetts, Switzerland and Sweden.

Ontario ranks alongside Japan and Germany as one of the top three exporters of motor vehicles and parts, capital equipment and industrial materials to the United States.

Our corporate tax credits for research and development work are unparalleled in the G-7 countries.

We have a highly trained and competitive and abundant workforce in technologically advanced fields such as telecommunications and computer software.

But we can't afford to coast on excellent assets and encouraging numbers. We have entered a new and intensified era of global economic competitiveness. Ontario is in a state of transition towards a knowledge-based, high-skilled economy. Companies and sectors are being forced to restructure to maintain and build on their base of business.

To achieve sustainable economic growth, Ontario needs to develop and expand on several fronts:

It must encourage even more self-reliance in people and in businesses.

Innovative businesses must be able to compete even more successfully in world markets.

We must continue to find new export markets for our products, services and tourist attractions, reducing our dependence on the United States.

We must become increasingly competitive in international markets and in a more diverse range of economic sectors.

We must create meaningful new links between businesses and institutions.

Although more research and development takes place in Ontario than in any other province, we must strive to become one of the best locations for research and development and for technology transfer in the world.

We must continue to help small and medium-sized companies gain access to the financing they need to grow.

We must renew efforts to help workers develop the skills and managerial abilities they need to thrive in our economy.

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Our economy will continue to face strong international competition. If we are to reclaim our position as one of the most prosperous economies in the world, we must adapt in new and dynamic ways to the global economy.

This is the challenge facing Ontario, and it lies at the core of my ministry's vision and economic development strategy.

Our vision is to be successful on three fronts: We want to help Ontario achieve sustainable growth and job creation and to compete strongly domestically and internationally; we want to work with entrepreneurs, sectors, communities and other governments in promoting economic development; and we want to make Ontario a leading North American destination for domestic and international travellers.

My ministry has been a leading advocate of government-wide initiatives to make Ontario one of the best places in the world to live, work, invest and travel.

We are cutting personal provincial income tax rates by 30% over the next three years. We have cut government spending by about $5 billion this fiscal year, and we are well on target to balance the provincial budget by the end of our first term in office. I should add that in its efforts to bring about responsible fiscal management, this government is asking just about every Ontarian to bite the bullet. Every ministry of the Ontario government has had to cope with diminished funding, and economic development, trade and tourism is no exception. As a result, businesses have to meet the challenges of our readjustment.

So we have eliminated programs that provide loans and grants to businesses. We believe that such government handouts give certain companies unfair advantages over others. They skew the marketplace and they allow inefficient business practices to continue instead of being improved or discontinued.

I travel regularly around the province, meeting with business people and with the leaders of our economic sectors. I know what business wants. I hear it every day, and I know that what I am hearing is right.

Business wants government out of its way. Business wants a predictable and reasonable set of rules and regulations to live by. If a government happens to be handing out money, it's to be expected that all sorts of companies will want to benefit. But companies and business leaders that I have met would argue that the best solution is to eliminate preferential treatment of a few select companies and to use the savings to pay down the deficit and to invest in strategic sector-wide initiatives that improve our overall economic competitiveness.

We have repealed anti-business laws and replaced them with legislation much more in line with the needs of today's business realities. We are stripping away red tape and needless regulations as fast as we can because we recognize that unnecessary government regulations discourage investment.

The Ontario government is taking every opportunity to provide public services in better, more efficient ways and at less cost to hardworking taxpayers.

Our ministry is at the forefront of creating a smaller, leaner and more efficient government. We are moving in strategic and fiscally responsible ways to stimulate Ontario's business sectors, to encourage the transformation towards a highly skilled and information-based economy and to provide the right climate for training, research and development and exciting new applications of scientific knowledge and the information highway.

Just last month, I attended a federal-provincial-territorial conference for ministers responsible for the information highway. I made the point that it is impossible to think of our long-term economic competitiveness or to consider sustained improvements to our quality of life without thinking about the information highway. I also suggested that the information highway provides governments their best opportunity to deliver public services in better, more efficient and less costly ways.

Information technology is one of the world's fastest-growing economic sectors.

I said at that conference that we have the ability to make Ontario and Canada world leaders in the digital revolution, and I hope that we will all work towards that goal. Also at the conference I called for a more aggressive national effort to give Canadians the tools they need to compete in the new information-based economy.

We in the Ontario government are certainly committed to that goal, in ways that I will describe shortly.

First, I would like to describe how the ministry has been restructured and refocused. We are considerably leaner and more efficient than we were previously, and we are entering into much more significant and sustainable partnerships with businesses and communities.

A restructured and more efficient ministry means that this government assumed office promising to take a hard look at programs and services to help reduce the deficit. Within days of being sworn in, we began to act on that promise. And we looked at it as much more than a cost-cutting exercise; we looked at it as a way to fundamentally improve the character of our government.

The huge job of restructuring and downsizing Ontario's public sector began right away, and our Ministry of Economic Development, Trade and Tourism has been an integral part of the process.

Our ministry's budget this year is about $306 million. That's approximately a 50% reduction from the 1995-96 budget. Our staffing level has been reduced by about 30% this year, to the current level of about 765 employees. That figure includes all of the employees at our agencies which are outside our ministry.

Clearly, our ministry has faced the same cost-cutting obligations that have affected companies and public institutions across Canada, and we have used the opportunity to find creative and meaningful ways to deliver on our mandate to help the private sector create jobs.

Last spring, shortly after the May budget, the government released business plans for all government ministries. The plans clearly defined the business activities of all the ministries with measurable performance targets.

As our own business plan indicates, part of our effort to become more effective and efficient involved realigning the ministry into four new divisions, down from seven under the previous government. We are like a sophisticated management consulting firm with a well-qualified and experienced team ready to help business meet its challenges.

I might say at this time that we now have four assistant deputy ministers; we inherited seven.

The ministry's old approach involved costly bureaucratic approaches; unfocused marketing; direct financial assistance to individual companies, creating selective and unfair subsidies; heavily subsidized agencies and attractions, and so forth.

The new approach of the ministry involves working with business to meet their challenges; marketing Ontario to key decision-makers here and around the world; focusing reduced financial support on sectors and clusters of companies where there are broader economic development benefits; helping businesses become more self-reliant -- a very important aspect of our ministry -- and helping agencies achieve greater self-sufficiency through commercialization or privatization.

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People around the world admire our quality of life in Ontario. As a business person, as an occasional tourist and as Minister of Economic Development, Trade and Tourism, I have seen for myself how respected and admired Ontario is. And every time I return home, I am reminded of how fortunate we are to live in this province.

But as a former business person, as one who has taken part extensively in community volunteer efforts, as a parent and a grandparent, and as a minister of this government, I refuse to take our privileges and our good fortune for granted. Our quality of life is by no means a given. The future will not be handed to us on a silver platter. As a province, we face complex economic challenges, and we must meet them head-on.

Ontarians are working hard to better their lives. Every day, students, parents, employees, small business people and corporate leaders make the most of the tools they have -- skills, knowledge, networks and resources -- to improve their lives.

We all know people in our immediate circle of friends and family who hold down jobs, sometimes they hold more than one, while studying or raising children or giving to their communities. Collectively, business people and government leaders have a responsibility to show that same ability to take stock of their resources and seize opportunities to fulfil their ambitions.

We have to work together in creative and fiscally responsible ways to help Ontarians compete economically with the strongest jurisdictions in the world. We must find strategic ways to invest in a strong and diverse economy, which is the best possible guarantee to maintain our quality of life.

I am proud that the Ministry of Economic Development, Trade and Tourism is taking bold, clear steps towards that goal. I am happy to discuss all of the efforts we are taking, and I am pleased that we will have a chance to do that with the other two parties of the House.

The Acting Chair: Thank you, Minister. It's the official opposition's turn for half an hour now.

Mr Michael Brown: I first would like to thank the minister and his staff for attending and taking part in this process. I truly believe that the estimates process is one of the more important parts of the legislative agenda. It gives members of the Legislature, the back bench of all parties, an opportunity to directly converse with the minister and his staff on matters that I believe are very important to the people of Ontario and to get clarification of a number of government policies.

I would just indicate to the minister that our critic, Mr Kwinter, will be here next week. Unfortunately, he's out of the province this week. He will probably be able to discuss these matters more in depth as he's someone terribly familiar with your ministry.

Hon Mr Saunderson: He does travel a lot these days.

Mr Michael Brown: He knows what's going on.

Hon Mr Saunderson: He does.

Mr Michael Brown: Anyway, I was very interested in the minister's statement directly in that as I read through it I came to the same conclusion that Mr Kwinter had come to, and he asked me to ask the minister what probably his first question would have been if he had been here. It was: If your ministry wasn't there, who would notice?

As I read through this, frankly I didn't see anything that your ministry is doing to do anything. I hear about the Treasurer doing things, I hear about lots of other ministries doing something, but frankly I don't know why we're even spending the $306 million, if that's what it's about. I don't think Ontarians are getting much value for money.

We look at your statement. You say that since July 1995, 105,000 jobs have been created in Ontario, and that's laudable. But you know what that means, don't you? That since 1990 this province has created 25,000 new jobs. Since 1990? You have 25,000 people more working in this province six years later, and that's supposed to be good?

We have 60,000 people more unemployed today than we had when you took power, because 105,000 jobs a year will not replace the increase in our workforce every year. If I follow this through, at 105,000 jobs in a little more than a year, you are 325,000 jobs short of where you said you would be in the Common Sense Revolution. I find it's a remarkable admission of ineptitude rather than something the government should be proud of.

You talk about interest rates being low. That is, in my view, probably the most positive economic news we could have. It probably creates more jobs in the economy than any other single factor. But I hardly believe the government of Ontario can take much credit for interest rates being low. It may have some effect in our economy, what you do fiscally, but frankly you're not the major player here. The world markets are the major player and the Canadian government is a major player. So the idea that you would even suggest that interest rates are a function of what you're doing is just quite remarkable.

The other thing I find absolutely amazing -- one of the things I think we in Ontario have come to understand over the years is that we cannot put all our eggs in one basket. Trading with the Americans and the Mexicans is very important to our economy, but my understanding, Minister -- and if I'm wrong, you could correct me -- is that trade with the rest of the world is actually falling as a percentage of our overall trade. To me, that should signal real problems to the people of Ontario. We should be more active in the southeast Asian markets, we should be more active in the European markets, we should be more active as a province around the world promoting Canadian, and in particular Ontarian, business.

I see projections of your 3% GDP increase, which I think is quite laudable, but after the experience of the last six years in this province, you would think the pent-up demand in this province would produce more than a 3% growth. I would have hoped so. I know in Ontario we need to do that, to have better than 3% growth, or we're really not going to do what we need to do in terms of providing employment and being able to sustain our programs in this province, particularly in health care.

As I look through here, you talk about high tech, you talk about research and development, but at the same time your colleague Mr Snobelen is out beating up university after university. He is out seeing what he can do to destroy public education in this province. I can understand on your trade missions your Premier is fond of telling everybody who wants to listen that Ontario provides the best-qualified, most highly educated workforce in the world, and I believe that. He says this is the best. Then he comes home and all we find out in this province is how bad our education system is. I'm fundamentally at a loss to explain what the government says in different locations to different people.

This is the strongest province in Confederation; it always has been. I think one of the sad parts is how we haven't progressed greatly in the last five or six years. But I don't think what you've told us today gives us much encouragement that we'll be continually moving forward. I think we owe it to the generations that will follow us to leave them not only with a fiscally responsible province with a good bottom line, but without deficits in the other major areas.

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I will leave some of the more major things, I think, to my colleague Mr Kwinter when he comes, but I wish to discuss with you another issue that we find a little strange. Last year at this time, or at the time we were going through your ministry's estimates, you were asked if the government was considering video lottery terminals.

Mr Gilles Bisson (Cochrane South): What did he say?

Mr Michael Brown: What apparently was said was that he had no knowledge of any operation or any government plan to introduce video lottery terminals in the province of Ontario. Given that the Ontario Lottery Corp is an agency of your ministry, I'm absolutely shocked that you would have absolutely no knowledge six weeks before the announcement that there would be this legislation introduced in the House. I think most of us are finding that either you are completely out of the loop or you kept us completely out of the loop. I find neither one of those to be acceptable.

I have some grave concerns about our marketing efforts. I'm told in my constituency that your Tourism Ontario operation, which used to provide to all tourism operations a listing at no cost to themselves -- that is no longer available, but what they do have is a partnership with Bell Canada. For a mere $240 for the basic package, you can play. I tell you, for the small business person in tourism on Manitoulin Island or along the North Shore, $240 is a tremendous amount of money, given the fact that I'm told that tourism in our area this year is down 15% to 20%. I know, in talking to the people who are involved, whether they have restaurants or cabins or motels or hotels or resorts or even grocery stores, that the impact in our area has been terribly significant. I wonder how the minister can explain to my particular constituents, or any in the northeast, because I understand it to be fairly general across the northeast, that tourism dollars are down dramatically.

We could maybe point to a rather -- I'm looking for the right adjective -- anaemic marketing effort by the government to encourage people to come to Ontario, spend time in Ontario, spend some money in Ontario, because we are one of the greatest bargains in tourism in North America and maybe the world. Given all that, we're having tremendous difficulty understanding how you're going to do all this better when the results we're seeing are far worse.

Also, I think one of the things you're not talking about, as you're so business-friendly, is the tremendous downloading of costs to business. The Crown Forest Sustainability Act, the aggregates act, in my area those bills are turning government costs over to industry in the hundreds of millions of dollars. I'm not sure how that makes businesses in Ontario any more competitive than anywhere else. Minister, I'm puzzled.

I'm also puzzled by the member for Kenora today talking to the Minister of Environment and Energy. The member for Kenora was asking how a $10,000 bill to a trailer park operator for water testing labs helps small business. I'm really puzzled at how that downloading of government services is to help the small business person. All I think small business people are seeing is fee after fee after new fee after new expense for something that used to be provided by government and no longer is.

We would like to know that the Minister of Economic Development, Trade and Tourism would be at the cabinet table saying, "I think small business is important and I don't think we can be downloading to business people either through increased taxes or new fees," because all of those things are happening in my area. Increased property taxes and the new fees are happening everywhere. That is crippling, hurting and in some cases bankrupting businesses that have been around not just for a short while.

We hear the glowing words that are in your nice statement. If you read this, to be fair, I don't think I can find anything that you are particularly doing.

You talk in one section, and I am just trying to find it here, about access to capital being a problem, but you don't tell us what you intend to do to fix that problem. We agree that access to capital, especially for small business, is a problem.

Mr Tony Martin (Sault Ste Marie): Particularly in the north.

Mr Michael Brown: My friend says, "Particularly in the north," but I think it's particularly anywhere. I've been in business. It's hard to find money, especially for small business. You were identifying it as a problem, but you have not said one thing about what your solution might be to that problem.

Is it grants or loans? You've said there can't be grants or loans; that's not possible. You don't like grants or loans because it skews the market. But I hope you'll help me when you get a chance to reply, because if it's not grants or loans, I don't know what it could be. Maybe you're going to take equity positions in smaller companies. It might be a good idea, but you haven't told us.

With that, I think I'll give my colleague from Prescott and Russell a few moments to speak more directly about tourist issues.

Mr Jean-Marc Lalonde (Prescott and Russell): Minister, I have a few questions. You mention on page 4, "Sustained Efforts Needed to Meet Ontario's Challenges." The fourth item is, "We must continue to find new export markets for our products, services and tourist attractions, reducing our dependence on the United States." What approach are we going to take now to continue increasing or having the tourist people come and visit Ontario?

Hon Mr Saunderson: I was reading from an enlarged version because of my great eyesight, so we had another copy. Page 4?

Mr Lalonde: Page 4, yes, the sustained efforts. You say, "We must continue to find new export markets for our products...."

Hon Mr Saunderson: Do you want me to respond now?

Mr Lalonde: If you could, please.

Hon Mr Saunderson: Or do you want to make your statement? I think it will be hard to keep track of the time for you, because I think you still have about 15 minutes for your party.

Mr Michael Brown: I asked a number of questions and perhaps if the minister wishes to respond, we'd be happy to have him respond to Mr Lalonde's question and the ones I raised.

Mr Lalonde: All the points that you're identifying in there, do you have a plan, what type of approach you'll be taking to meet those criteria that you are talking about in there?

Hon Mr Saunderson: We certainly do.

My understanding of this process is that I was to speak for roughly half an hour; then the official opposition and then the third party would speak for half an hour, and then I would have a rebuttal, at which time I could answer the questions or make further statements.

Mr Michael Brown: We're happy with that.

Mr Lalonde: Really, all the points in there, as I said, I'd just like to know what approach the government is taking to meet those criteria or the points that you are highlighting in there, because we must continue to help small and medium-sized companies gain access to financing the need to grow. It's nice to say, "We must, we must," but what is the approach that this government is going to take? You must have a plan.

Hon Mr Saunderson: We do.

Mr Lalonde: Is it possible for us to get a copy of that?

The Acting Chair: He will answer you later. You ask and he will answer later.

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Mr Lalonde: Is it the government's intention to reopen the offices in other countries, such as France? We used to have an office there. We used to have offices in different parts of the world, in the capitals of different countries. Does the government intend to reopen those offices?

The Acting Chair: He'll respond later.

Mr Lalonde: I remember during the previous government we met the minister at the time knowing that in eastern Ontario especially we depend a lot on francophone tourism, not only from the province of Quebec but also from France. They're coming to Montreal and then they just bypass Ottawa or the Prescott and Russell region because they think this region is mainly anglophone people. They just bypass the area.

The point I'm getting at is that we were asking the government at that time if they would invest additional money in marketing the area by publishing some French documents so that francophones would know that in Ontario we do service in both languages. Ontario has 550,000 francophones.

Just the other day myself and Ben Grandmaître, my colleague, met a group at the bottom of the stairs. When I heard the group was speaking French, I went to see them. I said, "What part of the country are you from?" They were from France and immediately I said, "I hope you have a French tour guide," and a lady came to us and said, "Yes, I am the tour guide for this group." I said, "You're not an employee from the Legislature here." She said, "No, I'm from Bois-Franc." Bois-Franc is a sector of Quebec.

The first question that was asked of us was -- if the information would have been available at Mirabel Airport, for example, they would have known immediately -- "How many francophones are there in Ontario?" I said, "There's 550,000." Immediately the tour guide, this lady from Bois-Franc, said, "Yes, but they're mainly in the Windsor area." So immediately I noticed that the people were misinformed.

Just this Saturday coming I'm meeting a group from France in Prescott and Russell, in the village of Castleman. We want to tell the people now to come into Ottawa or to Toronto before they fly down to Quebec because they are misinformed about our district. If they do fly to Toronto, probably they'll find out when they get to Toronto that the majority of francophones are in eastern Ontario and northern Ontario.

What I'm getting at is that I really feel this government should spend money in marketing, informing people from other countries and also the province of Quebec that it is possible for them to be served in their own language, which for them is the francophone services or the francophone people in our eastern region and also the northern region.

Really just to go back again, the former minister had said at that time that there was no money available to inform the people or to publish publications in French in the province of Quebec to attract tourists to Ontario. That would be the point that I had to bring to the attention of the minister.

The Acting Chair: Is that it now? Okay. Mr Martin.

Mr Martin: I appreciate the opportunity to participate in this discussion today. Even though I know in the very short interaction that I've had with the minister, Mr Saunderson, he's a decent guy and probably believes very wholeheartedly in the program that he is delivering on behalf of the government, that what he's doing is in the best interests of the province and the people of Ontario, I would suggest to him that that in fact it is otherwise and I would hope that out of his sense of --

Mr Wettlaufer: We wouldn't expect you to say anything else.

Mr Martin: No, you wouldn't. My track record is such, is it, Wayne? I would hope that out of his sense of decency, though, and out of his sense of fair play and his long and distinguished experience in the field of finance and business that he would come at some point to an understanding that the program he has set about, that which he is doing in the province, is not in the best interests of the long-term health both from an economic perspective and even more importantly, for me, the social health and wellbeing of the people who live, work and call a jurisdiction home is what's most important.

This document that was delivered today is nothing but another exercise in public relations, in putting a new sheen on a picture that is growing ever more used and abused as time goes on under the tutelage of the present regime at Queen's Park. I would be very much concerned about this paper and about the impact and effect that it might have out there by way of misleading the public if I didn't think the public were smarter than that.

I don't think this government gives the people of Ontario enough credit for seeing through bad policy and for making up its own mind and deciding, in the end, what it feels is good for itself. It's one thing to spend a lot of time on Bay Street and spend a lot of time surrounded by the financial wizards that are available to you as a minister in this place. When you become a minister here, you get lots of advice from some very qualified and capable people, and they can convince you of some things that they feel in their heart -- and I'm not imputing any negative motive here -- is in the best interests of this province. When you combine that with an ideology that this government obviously came to this place with, you begin to see some very interesting things happen.

It's one thing to surround yourself and be set in a context of Bay Street advisers and highly qualified and educated economists. It's one thing to spend a lot of time schmoozing and wining and dining with the financiers from around the world, yes, which we are a part of, to go to Europe and France and meet with the finance ministers and economic development ministers and talk to them about what they think is in the best interests of the people they represent and the global economy as they grapple with how they make it work best. It's one thing to spend time on your days off or your holidays on the golf courses of this province. But I suggest to you, Minister, that it's another thing to spend time out there in the communities of this province and to rub shoulders with the ordinary working folks in this province and to spend time in the coffee shops of some of the towns and communities and cities that all of us around this table here represent and try to speak on behalf of here.

They will tell you, if what I'm hearing is true, and I tend to believe it is -- I spent a lot of time this summer in northern Ontario. I spent a lot of time in Sault Ste Marie. I spent a lot of time in some very interesting places: on the sidelines of soccer fields as I watched my kids play and schmoozed with the parents of other kids as they played soccer.

They shared with me a very different story. Their concerns, their anxieties, what they're experiencing, what they're seeing around them in their communities, in their neighbourhoods, in their families is a far different picture than what you're painting here in this presentation you made today.

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It seems to me that any economy that's worth its salt and that's going to compete in the world today -- and certainly Ontario is a leading example of it, because governments before you have been committed to a very different set of values than you, including your predecessor Conservative governments. They saw to it in order for Ontario to be in the position that it is today so that you, Mr Saunderson, a decent man, could sit here today and talk about how good the economy is in Ontario, how good the standard of living is in Ontario and how envied we are around the world today. That didn't happen in the last year and some few months. That happened over a number of years, the effect and the outcome of a lot of hard work by a lot of people. More importantly, it's the result of leadership given by governments in many serious and significant ways in this province so that this province indeed, as you have said, and I agree with you, is the best.

I'm concerned how long that will be if we continue down the road that you have us on, because we all know and you know that the fundamental determinant for the good economic health of this province is a good, publicly funded, universally accessible education system, a good, publicly funded, universally accessible health care system, and an infrastructure that's first class.

Governments up to this point in time have invested heavily in those areas, have taken money that they've realized through, yes, the tax system in this province, because we believe in collectively building a future together, and have put it into developing first-class education systems: elementary, secondary, the college system and the university system. You in your paper here reference the fact that some of our graduates are sought by many of the world's financial institutions because of the skill they have, because of the knowledge base they have and because of the work ethic that's present in this province.

But I have to tell you that as we go down the road that you have us on, where your government -- not you specifically but your government -- is beginning to cut closer and closer to the bone, where your government is beginning to do things that are counterproductive, you will begin to see those institutions fail, those institutions begin to lose their potency.

You're suggesting that the private sector will move in and take over that space that's been created. I beg to differ. Having said that, if in fact that's what you're proposing will happen and if you see a different role for, for example, colleges and universities and schools in this province, we need to see from you, so that we can participate with you in a more confident and hopeful way in this new development, some plans, some laid-out business plan that tells us what we're going to do today and tomorrow and next year and five years down the road, what the numbers are going to look like, how many people are going to be employed, what kinds of skills are going to be required and what the end product is going to look like.

I know myself from having been in business for a short time before I came to this place that no financial institution whatsoever was willing to even meet with me re the future of the enterprise that I was involved in if I didn't have with me a well-thought-out and practical and doable business plan.

There is no business plan here for the economy of this province, and there's no reference at all to the important role that the education system plays, the health care system plays, the infrastructure of this province plays in any future that we might have, or any commitment to improving those or changing them in any significant way so that at the end of the day we might have something that will be more helpful as opposed to less helpful. That concerns me very much. That concerns me greatly.

Hand in hand with not having a first-class education system and not having a first-class health care system and not having an infrastructure that we feel confident will carry us into the future goes the fact that we're losing jobs in those areas. Where over the last 10 or 15 or 20 years we had people in this province who were willing to invest in their own future by going to school and learning certain skills and then contributing their time and effort and resource to the collective goal of making sure that the communities we live in prosper and that this province improves, they're no longer sure there are going to be jobs for them, so they're questioning whether they should make the commitment to the education they require in the first place. They don't know, as they look down the road, what they're going to be asked to do and what skill they're going to need because nobody is painting that picture for them.

There's no government working with them hand in hand now, cooperatively, around the question of what they need to know, where we're going and how we are going to arrive there together so that everybody is still on the cart when we get there. That has to be a huge concern for all of us.

To get even a little more specific, some of the infrastructure -- Mr Brown I think alluded to this when he said that by looking at this paper and at the track record of the Ministry of Economic Development, Trade and Tourism, and it shouldn't surprise any of us, as I think about it, there really is nothing going on. You have said from the outset that government has to get out of the face of business, government has to get off the back of business, government has to get out of the business of economic development and improving the financial situation of industry in this province and let it do its own thing; let it rise to the surface and naturally achieve some things.

There's nothing in here to suggest that course is changing. There's nothing in here to suggest that the Ministry of Economic Development, Trade and Tourism is replacing a lot of things that they've wound down, that they've taken away, that they've decided are no longer useful and relevant. For those who are out there looking for assistance or direction or help or ways of working together there just aren't those vehicles any more.

I know from talking to some economic development professionals in my area that the very vibrant, wholesome, interconnected web of community economic development offices and professionals that was there in 1994 and 1995, particularly in northern Ontario, and had been developed over the years by successive Conservative, Liberal and New Democratic governments because we knew and felt very strongly in our hearts that government needed to be involved, needed to be a partner and to be helpful in these things, is now beginning to come apart at the seams.

There are fewer people working in these areas. In some communities the offices have closed right down. They're not there any more, they're gone, so whom do we turn to? In my community there's still a federal government office of the community development corp and there's the Economic Development Corp. Both of them are now in many significant ways competing with each other for dollars they might be able to generate by offering services on the open market for advice they used to give freely, on behalf of the government, to potential entrepreneurs and business people as they sought to take advantage of opportunities that are presented, through the evolution of things, like NAFTA and GATT and so many other new trade alignments and realignments that we've gotten ourselves into over the last two or three years. But they're not there any more. I suggest to you that's going to be a big hole to fill. I think it's going to do big damage.

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There are a number of things I'd like to share with you this afternoon, but I think over the 15 hours we have together I'll get a further chance to do that. In wrapping up my comments, because I want to give my colleague from Timmins a chance to put some thoughts on the record, it seems to me, and I will be making a case as these estimates discussions go on, that there is an important role for government in any future we have together in our communities and in the province, as we go into the next century.

I only have some examples from my own community to share with you. They're the most obvious in my mind, they're the freshest in my memory and they're good examples. In my community in the early 1990s we had crises in all of our major industrial endeavours. Algoma Steel was in crisis, St Marys Paper was in crisis, the Algoma Central Railroad was in crisis, Lajambe lumber was in crisis. If we had just washed our hands of that and simply decided that those companies should just sink or swim on their own merit in the free market system that determines that, Sault Ste Marie today would be a far different place, but that isn't what we did.

The government of the day, that I happened to be a part of, came in and called to the table all the players -- the financial institutions, the management group and the workers -- and said, "What can we do in this circumstance?" The details are many, the story is long and it'll be told by others who are closer to it than I in more eloquent ways, but at the end of the day we have an Algoma Steel, a company that today is feeling so confident about itself and its future that it's willing to invest close to $500 million in new technology so that they will be in a position to compete in the next century with the many new mills that are developing in the States and other places around the world. So Sault Ste Marie --

Mr Wettlaufer: I sure hope it'll still be there.

Mr Martin: It'll be there. I'll put money on it. Do you want to have a little bet? I'll do that. Three years ago when all this restructuring was happening -- it was funny. I got calls from some steel analysts in this city who said, "Tony, can we go for a coffee?" I said, "Sure, you know I'm always good for a coffee if somebody else is paying."

Mr Michael Brown: That figures.

Mr Martin: That figures, absolutely. I've bought my fair share of coffees for people too.

The Acting Chair: Mr Martin, you should address the minister instead of getting into that.

Mr Martin: Mr Wettlaufer is a good --

The Acting Chair: You can talk to him after.

Mr Martin: They took me for coffee and tried to convince me that what was going on in Sault Ste Marie was absolutely ridiculous, that it was foolish, that we shouldn't be doing it, that it was pouring good money after bad and that instead of shareholders now losing their shirts on this venture called Algoma Steel, we were going to see all the workers there lose their shirts on this deal.

I have to say to you that now, three years later, happily we have a company that since then consistently has shown profits every quarter. They've invested money they've generated by way of profit back into that company, have gone out on the free market and borrowed and debentured their way into now making this new investment. It's the same story at St Marys Paper and Algoma Central Railroad and Lajambe lumber. Because of the active involvement of the government in that whole venture we have three or four major industrial foundation blocks of our community still doing well, investing new money in new technology, and because of that our community is looking forward to what will be a future for all of us.

There are other things we're concerned about, and I'll talk about those another day. I want to give my friend from Timmins a chance to spin his story.

Mr Bisson: I would have to say, Minister, in listening to your comments, that it always astounds and upsets me to hear members of this government go on at length about everything that happened in the past being God-awful. You sit there time and time again and talk about how the world before 1995 didn't exist and how only since 1995 have things started to happen. You forget what has happened in the history of this province.

Why do people invest in Ontario? It's as Mr Martin and Mr Brown have said: Over a period of years the Tories, Liberals and New Democrats in government, and the business sector, have built up a province that has done fairly well. It's not because of the government of Mike Harris in 1995 that suddenly everybody came and invested in the province of Ontario. It had been happening here for years.

I hear the government taking credit for what's happening with regard to the economy. They say Ontario leads the G-7 this year. That was happening in 1994, when there was an NDP government in place. Don't nod your head. I can hear the shaking from over here. The reality is in 1994 the Ontario economy led the G-7, and that was happening under the socialist government of Bob Rae. Did we do everything right? Hell, no. Are you doing everything right? Hell, no. The point is that not every government before you did everything wrong.

The government of David Peterson, as much as I was adversarial to that government because they did things I didn't like, did some good stuff in Ontario. Over the period of four or five years that they were in government they did a number of things specific to this ministry, when it came to economic development, that were positive steps forward, and that work was carried on by Premier Rae and by Minister Lankin and others who were there before you.

My colleague from Sault Ste Marie talked about what happened at Algoma Steel. The same story can be told in many communities across this province. What would have happened in Kapuskasing if the government of the day, through the economic development and trade ministry, hadn't taken the involved role that they did? There wouldn't be a Kapuskasing today.

What would have happened to de Havilland? De Havilland wouldn't exist now. If we had listened to the federal government at that time, your Tory friends, de Havilland would have been allowed to close and Ontario would have lost the major player in the aerospace industry.

I have a fairly hard time listening to the rhetoric of the government about how everything before was terrible and nothing else was good until they came along.

You say with pride that you reduced the number of deputy ministers from seven to four, as if that's some great leap forward. The reality is that those deputy ministers were doing some work. I'm insulted, for one, to hear civil servants in this province being devalued the way this government has been going. I think it's shameful.

What were those seven deputy ministers at the Ministry of Economic Development, Trade and Tourism and the other staff doing who were there before? They were working on economic development. They were working on behalf of the people of Ontario, developing strategies within the plastics industry, within the aerospace industry, within the granite industry and others across the province, and we have all kinds of experiences to show for it. In my own community of Iroquois Falls we have a brand-new granite plant. It didn't come out of nowhere. Yes, it was a private sector developer, but the province of Ontario played a role, and it played it through your ministry.

I have a real problem hearing this government go on at length about the work that people at economic development and trade did being terrible and that everything that happened prior to 1995 didn't work. You devalue everything they've done.

I just want to say one last thing, and we'll get into this in more detail. You say that this government is trying to remove itself from the face of business. I'd just say a couple of things to that. Government has a role to play in the economy, and this is where Tories and New Democrats part. You believe you should take government out of the face of business, which means deregulate it; let them do what they want and let the economy dictate.

If that had been the case in the history of this province, many regions would not have the economy they have. Northern Ontario, by and large, developed into the economy that it has not only based on the private sector developments of northern Ontario but because the provincial and federal governments prior to you and me played a role with the TNO railroad in northern Ontario, with norOntair, which you shut down, with the telephone company, with the roads infrastructure that we put in place. Without that, we wouldn't have a northern economy.

Municipalities across this province are now trying as best they can, under attack, to deal with what you are doing to their municipal grants. What does that have to do with economic development? I got a phone call yesterday from the managers of two of the mines in the Matheson area. Here's what you guys are doing:

You're cutting the transfer payments to municipalities -- the township of Black River-Matheson is affected -- and as a result they're moving in and annexing two municipalities. Do you know what that means to the two local mines? They're now going to be taxed by the municipality, where they weren't before. It means that those two mines -- you say you want government out of the face of business. In this particular case the municipalities that deal with offloading now are forced to try to annex other municipalities. You would know, as a former reeve, that they don't have a lot of choice.

Mr Bert Johnson (Perth): I never was a reeve.

Mr Bisson: You were involved in municipal politics for a number of years.

Interjection: He was the mayor.

Mr Bisson: A mayor. Pardon me. But the point I'm making is that those two particular mines, the old Barrick mine and Harker Holloway mine, both of them now are faced with municipal tax bills in excess of 100,000 bucks a year, should this go forward.

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Is that how we stimulate economic development in Ontario, by allowing local municipalities to make up their own tax policies as we go to try to deal with their economic problems? No, it's by the province of Ontario taking some leadership and saying, "Hell, we've got a role to play and we will take our responsibility." No, you don't have to go out and do all kinds of things for everybody, but you have to have the strategy in the province that applies to various industries in Ontario, and I'll submit through these estimates that you guys ain't doing that. For that, I cannot support what you guys are doing, especially in the role of economic development because, quite frankly, nothing is happening in that area.

The Acting Chair: You have two more minutes yet, if you want to waive it or --

Mr Bisson: Well, never waive two minutes when you've got it. That's the first rule of business.

I'd just say again that we understand in northern Ontario probably more than most other regions in the province of Ontario the role of government and how important it is to our economy.

Your ministry, sir, along with the Ministry of Northern Development and Mines, which I had the pleasure to serve as the parliamentary assistant for five years, played a key role in northern Ontario. If it wasn't for your ministry and it wasn't for northern development and mines, many businesses that are now operating as profitable businesses would not be operating today. In my riding alone, places like Malette Granite would not be in operation today had it not been for the initiatives of those two ministries.

For you to say, "We're going to cut all of the grants to businesses and we're going to take ourselves out of the face of business" ain't going to cut it. Yes, there are going to be a couple of winners. The larger corporations will win because they don't like competition. Large corporations by definition would rather have a monopoly. That's what it's all about. If they could buy up all their competitors and control the economy, they would.

What your policies are doing, in my view, is moving the balance of power to larger corporations at the expense of the smaller guy and the smaller businesses that are trying to eke out an existence within the Ontario economy. Doing what you're doing in economic development I'm afraid is going to lead to larger corporations getting richer and the little guy at the bottom trying to make a buck in a small business, or a medium-sized manufacturer trying to eke out a living is going to have much more of a difficult time under your government.

The Acting Chair: The minister now has up to 30 minutes to reply to the opposition parties.

Hon Mr Saunderson: First of all, I want to say that the statement I made at the beginning I felt was a general statement, which I hoped would provoke discussion and I'm certainly glad to see that it's working.

Mr Michael Brown: Understatement.

Hon Mr Saunderson: I think it is important to get the things out on the table and I'm going to attempt to rebut just a little bit. First of all, people wonder and you say what are we doing? If you ask the business community what we're doing, they know what we're doing. I've been travelling a lot in Ontario -- and by the way, business is important to this province, whether it's small business, medium size or big. I don't think anybody disagrees with that.

I look on this as a ministry of business and it's to be out there talking to businesses. I want to be able to meet with them on a regular basis, small, medium and large and I've been doing that once a month, I might say, in an informal setting. You learn a lot from talking to people. You learn their frustrations. I'm getting good messages from the business people. They like what we're doing. They say, "Don't blink" and we aren't going to, but they want to hear that. We have not had one request for any money since we got elected.

Mr Bisson: They know they're not going to get it.

Hon Mr Saunderson: That may be, but we haven't had any requests for money. But I might say they've got good confidence. Their exports are up and they think we're turning the corner.

I can just give you some examples of what I've seen and heard over the last few weeks, such as plant expansions and plant openings. I was at R. Schmidt auto parts manufacturers in Scarborough, a greenfield investment. It's been a long time since we've had a lot of greenfield investments in this province.

Moriroku auto parts for Honda Canada located in Listowel -- Bert Johnson and I were there. He's the member for Perth.

Mr Bert Johnson: Breaking ground next Wednesday.

Hon Mr Saunderson: Breaking ground so fast and that's because we relaxed the regulations and made it possible for them to get going quickly, Bert, and that's a testimony to you. But there's another example of confidence in Ontario. They will be supplying to Honda and we expect another announcement to come very shortly and then two more after that, all supplying Honda.

Mr Bisson: What's the name of that plant?

Hon Mr Saunderson: Moriroku auto parts located in Listowel. The Eli Lilly pharmaceuticals plant has been expanded in Scarborough. This is a very high-tech, sophisticated operation creating 36 very high-technology jobs. Jim Brown was there with me when we had the privilege of being there to see that open.

Boehringer Ingelheim pharmaceuticals' expansion was announced in Burlington just two weeks ago; I was there. That's a result of my visit to their pharmaceutical operation in Germany, in Ingelheim, last February. They're coming because we told them what was happening in Ontario. They have now consolidated all their telecommunications systems for their operations in North America in Burlington.

Also, we were in Hamilton about three weeks ago to open a new multimillion-dollar initiative by Philip Environmental, which is a very sophisticated system for scrubbing the stacks in the steel mills. That's something new. These things wouldn't happen unless people had confidence.

I was at Honda last week. I had the chance to celebrate their 10th anniversary with them and see a brand-new car roll off the assembly line. When we were in Listowel, by the way, we expedited many different applications for a location. We found the right one in Listowel. I think we did expedite things and I wanted to make that quite clear.

Then we also made a tour of the Weber mould and die casting operation in Midland last week and visited the International Research and Development Institute in Midland. That is a very good example of how government and the private sector can work together.

I have done a great deal of travelling, but it's not just travelling in Ontario. By the way, for those of you from the north, I have been in northern Ontario approximately five times since our election. I know the north quite well, Mr Martin. I think I told you I worked on the Algoma Central Railway when I was a high school student.

By the way, I might just comment about the situation in the Sault. Quite frankly, had, I think, our policies been in place instead of previous governments' policies, those companies would not have got into the financial difficulty they did. I'm talking about Algoma Steel, the paper mill up there, and Algoma Central, which actually was sold to United States interests and not, I don't think, helped by Ontario.

Anyway, all I'm saying is I have been throughout the province and I have always tried to meet with the leaders of the community, the business community particularly. They say, "Keep on doing what you're doing." I wanted to go on to other trips I have made outside Ontario.

I reported at the very brief estimates meeting that we had last winter that I had been in Europe, but since then I have been back into the United States. I have been down in Texas, in Houston. I took with us members of the petrochemical industry in Ontario. We took down Nova Corp. We took down Celanese Canada. We also had the president of the Ontario petrochemical industry with us. We had a chance to see also, when we were there, Exxon petroleum that is considering some new locations for plants.

The reason we went to Houston was we wanted to be sure that Ontario's going to get its fair share. When we told them what was going on in Ontario, they indeed were impressed. As a matter of fact, the gentleman who looked after the building of the addition to the Canadian Celanese plant in Kingston, Ontario, stood up and said, "This is why we did it in Ontario and not in the United States." We started roughly a year ago, and it was just a litany of all the good things that we have done in this province of Ontario and, by the way, eliminated from previous governments. That was proof positive. That made the Americans sit up and take notice, because there's nobody who is a better salesperson for this province than someone who's doing business in this province.

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We also went down to Mexico. The reason we went to Mexico was that, along with the United States and Canada, Mexico is one of the three countries that belong to NAFTA. It's important for them to know that we have many ways that we can help them and they can help us. We talked about agricultural exchanges, we talked about educational exchanges, we talked about both of us understanding the big country that's in the middle of the two of us.

That was a very productive trip. It was so productive that we had two agreements signed while we were there: one to have a Mexican company work with an Ontario company in the very sophisticated mapping system that mining, as an example, needs; and we also signed a letter of intent or memorandum of understanding between our board of trade in Toronto with Banco Mex in Mexico.

Then we went to California. While we were in California -- and by the way, we went with 10 Ontario-based high-technology companies, most of them from the Ottawa-Carleton region. So that's eastern Ontario being looked after. They told why they were in Ontario and had very productive meetings, and we had a very good seminar. I do think, by the way, that the best thing we can do when we travel is to have as many business people travel with us as is possible and to have seminars for Ontario people to be able to say, "This is why we're doing things in Ontario."

That is just an example of what we have been doing. Oh, I forgot one other trip, when we went down to Atlanta, and not for the Olympics, by the way, and also to Boston. It's amazing what you learn on these trips. We heard that 40% of the exports of Ontario wine go right into the Boston area. But we were told that we should come back to this province and get certain regions to promote themselves as good regions for American tourists to come to. We've done that. They suggested the Ottawa-Carleton region is a very special place historically in Ontario's history and in what's going on at the present time. We conveyed that information to the Ottawa-Carleton region. As you know, OC-EDCO is a very aggressive economic development operation there.

You said this ministry has no purpose. What I'm telling you is what we're doing, and it shows that we have a very big purpose. I could read you letters from the people who came with us on our trips, whether it was to Texas or to California, and they all say, "Thank you for organizing this; it was great for us." If you would like me to give you those letters, I'd be happy to do so.

One of the things that's important for the ministry is to represent the province at interprovincial and territorial meetings as far as economic development and business matters are concerned. Recently, I was in Winnipeg to talk at our first ever federal-provincial-territorial on the information highway. While we were there, we had a very good discussion among the provinces and the federal government of how we have to lay the groundwork for a proper information highway.

It's a form of infrastructure. When you travel abroad, as I have, or when people come to my office in Toronto and they ask, "What about our infrastructure?" they're not necessarily talking about highways or railroads and sort of the hard goods of infrastructure; they're also talking about telecommunications infrastructure, which is very important for companies if they're going to locate here. We're committed to encouraging scientific research and technological applications, as well as sophisticated information highway infrastructure. It is so important for us to get that story out so that people will come here and take full advantage of the breakthrough benefits of high technology. It helps them run their business better, it helps them communicate back home, it helps them order, it helps them sell, it helps them run their business in general.

We've got in Ontario one of the most advanced computer networks linking schools, hospitals, universities, industry, small businesses and communities, and a lot of that has happened under our administration. But to be fair, it was there and happening before. But I think we have turned up the heat a bit more on it, and I think that's important.

I want to say, while I'm going through this whole process of estimates, that I'm not out necessarily to damn what has been done before. My point is that we are doing what we think is essential in this economic climate, and that's why we're doing it. For instance, we have established the telecommunications access partnerships, and that's a three-year, $20-million initiative launched in August and announced in the budget of May 8 of this year. It's an example of our commitment to work in partnership with the private sector and with communities to expand the information highway and develop new and better ways to use it.

I think this is creating jobs and it's creating a better economic climate. This TAP program, as I will call it, reflects our efforts to bring people together through technology. What we want to make sure of is that there are no communities in Ontario that do not have access to telecommunications, because as you know, telecommunications can do much from a health point of view, from a business point of view, almost every aspect of our life. But to be able to communicate with people is essential. I'm thinking of electrocardiograms that can be done over the telecommunications system.

When we meet with all these sectors that I have met with over these last 15 months, they have said, "Ratchet up the infrastructure as far as telecommunications is concerned." That's why this TAP program has come along.

We've worked with Bell Canada. I was there at Bell Canada this morning at its seminar it held between its company and all levels of government. We had long talks with them about digitization of all of the telephone systems in Ontario. There still are a few, or were a few, really, that were old-fashioned wire plug-in boards. Those are fast disappearing, but now it means that everybody is on digital equipment, which is essential for proper telecommunications. I just wanted to touch on that information highway.

One thing mentioned in some of the statements after mine was what we were doing about science and technology at university levels. First of all, we're building a very hospitable climate for scientific and technological innovation. We have centres of excellence in this province which are second to none, and they are quite unique in the education field. We have spoken to many university presidents in this province. I spoke at Sir Wilfrid Laurier University last fall. I have toured the University of Toronto centre of excellence. I have spoken to Rob Prichard, the president of the University of Toronto, Lorna Marsden, Marcel Hamelin at the University of Ottawa. These are people I know. They think we're doing the right thing.

The University of Ottawa is very close to me because I have worked with it from a fund-raising point of view and was fortunate to be honoured with a doctorate degree. So I'm not new to the university system and I want to say that as far as we are concerned, they are happy with what this government is doing.

Yes, there are changes in education. I'm not the Education and Training minister, but you did touch on education at the high school level. We go out and we say, as you mentioned the Premier has said, that we have a first-class education system. We want to make a better first-class education system. We want teachers who are monitored to make sure they're properly qualified. We want to make sure that our children are properly monitored so we know how well they're doing. That's what we were talking about with report cards, some sort of standardization there.

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When we were in California, we were told that because of one of their propositions which they voted for a few years ago, their education system slipped because they weren't keeping up to date and they were not monitoring how well their children are doing. I'm glad to know that in Ontario we are going to be monitoring how well our children are doing to identify learning problems and the like.

Also, I'm glad to see that we're going to go back and stream in our system so that the very bright, intelligent ones can move along at a level, and everybody else can move along at a good level. But we have to reward excellence, and that's what we're trying to do in this province, not only in an education way but also for a business way.

I think we, as Ontarians and Canadians, sometimes have a tendency not to champion our stars. The Americans do it very well. They're very patriotic. They are very quick to promote what they do well at. We could do a lot better job of that. I'm saying that for all Ontarians; no party's exempt from that. But I think we have to do something more to reward excellence and to champion our star people.

That's why we have a wisdom exchange, as an example, when we bring together 250 innovative growth companies. I might say, Mr Martin, that your government started the first wisdom exchange. We have built them up to be more than just once a year; to be three or four times a year, and not just necessarily in the Toronto region. This is an excellent system which brings these companies together. They share their wisdom.

I remember being in one of the meetings last year and I had the chance to listen in as somebody explained how you do exporting properly. This was just a small company, but this person from India became an expert on how to ship back to his home country. Other people were listening. That's the benefit of the wisdom exchange and we will be having one in December in the Ottawa-Carleton region, you might be interested to know. So that's, again, how we're helping eastern Ontario.

I wanted to talk about our core business in the ministry. We're really concentrating on four businesses. I might say that somebody said maybe we're cutting back too much with the bureaucracy. I don't think we are. I'd like to say that I think we're operating on a very slimmed-down but very efficient version. The previous minister in my ministry had a political staff of 34. I have a political staff of 10. I think we're leading by example by doing that.

I talked about cutting down from seven ADMs to four. That seems to have worked all right. We're still talking on a regular basis to all the business sectors. We've got tourism added to our ministry. That's an example of what this government's trying to do: It's doing more or better with less. I don't think we should ever lose track of that. That's why Frank Sheehan, who's with us today, is doing his Red Tape Review Commission.

We'd like to talk about the core business, and there are four new core divisions.

First of all, marketing Ontario: We are marketing Ontario as a place for investment and travel. That doesn't mean that just I'm marketing it or the Premier is marketing it or other ministers or MPPs who travel are; we want all Ontarians to market Ontario. Therefore, we will be announcing very soon our business ambassador program, or trade ambassadors. That means anybody who wants to in this province. We haven't got any fancy selection system here. Anybody who hears about this and travels somewhat will be a trade ambassador for this province.

We have kits prepared and they are available. One of the best pieces in the kit is Ontario, Canada: Doing Business in the Global Economy. This is an excellent booklet which talks about what is happening in Ontario. I could go through it for you, but quite frankly, it's the making of an excellent speech if you want to go out there and talk about Ontario, and that's what these people will do.

We're marketing Ontario as a place for investment. Obviously, we're doing that when we go out and we travel, but we market it as a place for investment by doing certain things in the Legislature. That's by making legislation such that we are getting out of the way of business. We're letting them do things and not be interfered with.

From a point of view of travel, we are working with the Canadian Tourism Commission. As you know, that's a partnership between the provinces and the federal government, and that is a useful way to get the private sector involved along with the levels of government.

Also, we have established, or we went along with what was already established I suppose is the best way to describe it, the Ontario Tourism Council which was established by the previous government, and we will be making an announcement about how we're going to proceed in that area very soon.

Anyway, we are working with businesses to remove barriers and improve commitment to investment, training and job creation. We're helping entrepreneurs, companies, sectors and communities to become more self-reliant and successful and we're supporting commercialization within the government to strengthen the economy.

I talked about our travel that we have made, the Premier and I and other ministers, but I can tell you that we have to keep on doing more of that and it's very likely that we will be going to Japan in November to pick up on what the Premier did when he was there last winter.

I have told you that we have met extensively with the business leaders and the business sector organizations during our first 16 months in office, and last month the Premier and I met with leaders of the prestigious Keidanren organization of senior Japanese business executives. They were here to prepare a story which is their impressions of Canada, and specifically Ontario and Quebec and New Brunswick and Alberta. They are going to go back and they will write up what they saw in Ontario. By the way, they were very impressed with what they saw and what they know we are doing. They had done their homework very well, and that will be the book for the next few years for Japanese companies as they look for where they are going to do business. We made a good impression with those people and I thought we did our job very well.

I touched a little bit on tourism, but I wanted to give you some statistics. More than 100 million visitors spent over $11 billion a year in Ontario in 1995. That generates direct and indirect employment for some 400,000 people, and tourism is the core activity of more than 28,000 businesses in Ontario. I know that you have many of them in northern Ontario who provide many wonderful resort facilities, particularly the wilderness experience for many Japanese, American and German tourists.

I had a chance to visit one of those camps -- I visited two really --

Mr Bisson: Which ones? Give me names.

Hon Mr Saunderson: Minimiska Lake, which is on the Albany River, which flows into James Bay, as you know. They pointed out to us their problems and their concerns and basically it is to try to find some balance between the logging industry and their own resource-based tourism industry. It was very factual. I have flown many times over the north in my previous life, but I did enjoy the chance to get out there and see the fact that a number of the logging roads were being left as logging roads, even after all the trees were gone, and I certainly feel, in fairness to the resource-based tourism industry, that those roads should be plowed under and replanted.

Anyway, that's a bit of a sidebar on the resource-based tourism industry, but it is a very important industry in northern Ontario, and I intend to keep going back there. I was at their annual meeting, the NOTOA annual meeting, last year, and it is now coming up again at the end of October in Sudbury.

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It is an important industry. It is our fourth-biggest export, the tourism industry, and I'm happy to say that during the first eight months of 1996, the number of overseas visitors to Ontario increased by 9% over the same period of last year. As I say, our key markets for external tourism are the UK and France and Germany and Japan. Those markets showed increases ranging from 2% to 24% in the first eight months. So we're making inroads with new and fast-growing markets as well. I'm happy to say that Japan tourism is up 13% and the volume of travel from Taiwan has increased by more than 35%. In that connection, I think we can look forward to more of that happening. One thing we do have is a partnership with government and the private sector, particularly in Germany and Japan and England.

To boost our competitiveness as a tourism destination and to capture an increased share of the $3.4-trillion worldwide tourism market, we're focusing key strategies on strategic planning and marketing analysis, advertising in the United States and overseas markets, retaining the services, as I've mentioned, of locally engaged firms in the UK, Germany and Japan.

Most important, we're trying to work with the tourism industry to leverage spending through partnerships with the private sector. We've all seen the tourism maps for various areas. The best kind of map to see is one that's got a lot of sponsorship from local hotels or tourist facilities, because that's helping the community.

We're working with business to remove barriers and renew investment, training and job creation. We know that businesses are working hard to reduce their costs to compete in an increasingly global market, so the last thing they need are costly, time-consuming government regulations. As I say, I meet regularly -- I try to do it once a month -- to talk to Ontario business leaders to seek advice about how to eliminate the red tape and the overly bureaucratic procedures I've already mentioned.

The summer was a good chance to travel for me. I spent a lot of it in the Ottawa region and in southwestern Ontario, to name just two areas, and I've already mentioned the north. So as you can see, I have tried to get around not only to see tourism facilities but also to talk to business people.

As you know, one of the first concrete steps of our new government was to form the Red Tape Review Commission, which we've talked about, and people are extremely happy that is in place. We are now seeing some of the regulations eliminated which were causing great frustrations to business.

We want to encourage self-reliance and success with business people, and I just want to go through some of the things we have done. We have eliminated the employee health tax for 80% of all businesses in Ontario. That's on the first $400,000 of payroll. We've eliminated the self-employed health tax on individuals, reformed the Labour Relations Act to restore a labour-management balance in the workplace, and repealed the Employment Equity Act. We are reforming the Workers' Compensation Act. A lot of these things were going to happen, but it was very good to have the input from the business community to make sure that we pushed through and did what we said we were going to do.

As you know, we've frozen hydro rates for five years.

I've talked about the innovative wisdom exchange system that we've got in place.

Coming to the last part of the notes I was making, we want to support commercialization. It's the last of our four core businesses in our ministry. We examined all of our agencies, boards and commissions to improve their financial self-sufficiency and to encourage more businesslike operations. There's the St Lawrence Parks Commission, the Niagara Parks Commission, the Ontario Lottery Corp, the Ottawa Congress Centre, the convention centre here. These are examples of our agencies, boards and commissions. What we are trying to do with these, and I know there was discussion in the House today about parks, is we think there are ways that the private sector can work with these crown agencies, boards and commissions.

Lastly, as I only have a very short time, we are very pleased with the way the Ontario Casino Corp is operating in Ontario. As you know, Windsor is working very successfully with two casinos and we opened a new casino in Orillia, Casino Rama, in July. The Niagara Falls casino will be up and operating by the late fall, before winter. This is injecting hundreds of millions of dollars into each of those regions that I mentioned and it's helping tourism in a great way.

We welcome the opportunity to discuss our work with the members of the committee. We have now made our statements and I'd just like to say that all ministries did business plans for the first time under this government. This plan, the plan for MEDT to which I've been alluding, is the first time this ministry has developed such a plan. How quickly some of you have forgotten this, because you ask what we've been doing. I had no trouble speaking for 60 minutes. I could go on for 120 minutes telling you what I've done.

The Acting Chair: Thank you, Minister. We have a 15-minute rotation now, starting with the official opposition.

Mr Michael Brown: The minister did a good job of speaking for 60 minutes and we are no more enlightened now. He did not respond, I don't think, to a single issue that we talked about.

I would like to ask the minister directly what I've already alluded to in my opening statement. I would like to ask him about slot machines in Ontario that this government and his ministry are in charge of. I wonder (a) why within six weeks of the government denying any knowledge of slot machines being introduced to the province of Ontario, we had them introduced; and (b) why he is not concerned with the organized crime that we are hearing about in the Legislature being associated with such machines in other jurisdictions.

Hon Mr Saunderson: Fine. I'm happy to respond to that. Last year when we had the estimates debate, I said that "to date the decision of the government is that there will be no VLTs. We keep all the doors open, as I've said many times, but to date there's no different decision on VLTs."

I think that was very true then. We were keeping the doors open and we eventually decided that we would implement VLTs. So I think I answered very honestly at that time. But I can tell you that we think that VLs, as they're now called --

Mr Michael Brown: Slot machines.

Hon Mr Saunderson: You call them what you want.

Mr Michael Brown: That's what everybody else calls them.

Hon Mr Saunderson: VLs. If they're implemented within tight regulatory controls and in limited access environments, we think they meet a legitimate entertainment demand and they provide additional resources for charitable organizations across the province. The introduction of VLs is in part a response to the tourism, hospitality and racetrack industries, who came to me and made inquiries about it. They were telling us that the VLs would help them compete with other jurisdictions that have a wide range of gaming and entertainment choices.

I think times have changed in this province and in this country and around the world. People have been going to the horse races for years and gambling. So for people to say that gambling is something new in this province is not right. We're certainly committed to consulting with those involved in other charitable gaming regions and with other stakeholders to determine the fairest way to distribute the funds to charities.

I think the province will experience a win-win situation. We have the experience of other jurisdictions to go by and we have been in consultation with them. I think this will ensure that there will be a proper implementation of video lotteries on sound business principles and we will be obtaining external advice from an expert which we will be able to announce as soon as a contract is signed with this organization to go out and find the best way to implement the VL system.

I'm fully confident, in response to the question, that the regulators and the police are doing their job well and will continue to do so. I think we're going to make VLs legitimate, legal and aboveboard. We've got at least 20,000, we are told, illegal VLs underground, and that's doing the community no good. So we're going to bring them out of the closet, so to speak, and I think this is the right way to do it.

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Mr Michael Brown: You know, however, that according to the chief, I guess, of the Metropolitan Toronto Police, they believe the introduction of legal slot machines will increase the number of illegal machines in the province of Ontario, not decrease it. That's what the police say.

Hon Mr Saunderson: Our advice is that this is the way we should proceed. Frankly, it's interesting to note that crime is down in Windsor since the casino opened.

Mr Michael Brown: That's a casino. That is a controlled environment. This is not every corner of the province.

Hon Mr Saunderson: Now wait. You must realize that this will be a controlled environment.

Mr Michael Brown: How so?

Hon Mr Saunderson: The VLs will be available only in licensed premises, apart from the racetracks. They will be usable only by people of drinking age, which is 19. I think that if there are violations of that by the people who have these VLs on their premises, they will lose those machines and they will lose their liquor licences as well. That's the reason they have put together the liquor licence and the gaming bills under one new bill, which has I think now been passed.

I think people are saying things that aren't true about the VLs. I'm pleased that one of the benefits is that the charities in this province are going to benefit dramatically and receive a lot more than they ever received on these roving charitable gaming events.

Mr Michael Brown: You're mixing a number of issues. I think we find it tremendously troublesome when there are police reports that we are not permitted to read and there are police reports that are public that are saying exactly the opposite.

To be clear, these will be available, as we understand it, in every licensed establishment in the province of Ontario, and you can go to very few even small hamlets where there aren't a few. So literally they'll be in every neighbourhood in the province of Ontario.

I think what the police are indicating is that the kind of surveillance and manpower that would be needed to monitor properly the slot machines in all those areas is just not possible or likely and that the big winner in this is not the restaurant owner or the local bar owner, although I agree that some of them will see some benefit, nor the charities who will get 10% of the take. It is the Treasurer, the Minister of Finance in this province, through considerably increased gambling revenue.

I'm just concerned, as I think all of us are, that the government is withholding information that they know full well exists. Other jurisdictions -- for example, British Columbia has released some of this information that they have. In Ontario we have an opportunity, if we're going to do this, to do this right. But denying that there are problems, denying that there are police reports, is not going to be a good way to proceed.

I think the Ontario Lottery Corp, for which you have responsibility, is going to be up against some criminal elements in the communities. We're told organized crime invades various establishments that have these particular machines. We at least should be looking at all the information that's available. We can't just deny that it exists, and that's what presently is going on.

A precise question that I think you raised: You talked about hiring a consultant. We would like to see the proposal call for that consultant to know that it has been done in an open way so that the study for the Ontario Lottery Corp is open and done according to normal public standards.

Hon Mr Saunderson: As I said before, we're confident that we're doing this in a careful, prudent manner, and it's going to be carefully regulated and monitored. We have no instance that we can recall of any of the underworld, if you want to call it that, getting involved in the casinos. So far, things have been very well done, and we're confident that we can do as good a job with the VLs in all of the locations we've talked about.

Mr Michael Brown: Except the police appear to have a different view.

Hon Mr Saunderson: I can't agree with that. I don't think all the police -- I think there was one report made, and that's what is --

Mr Michael Brown: Could you tell me about the proposal call for the implementation?

Hon Mr Saunderson: I just want to mention about the report that you've been referring to. It was commissioned in 1995, and as far as I was concerned there was one glaring error in it because it said that one of the Ontario Lottery Corp games, which was called Sport Select, could be subject to manipulation.

When my ministry called up the author of the report, he said he wrote that it's possible that it could happen. He picked up and said that was just an example. But the way it was reported in the newspapers, it made it look as though there was something going on there. That report is a bit overblown, in my opinion.

Mr Michael Brown: So you've read that report.

Hon Mr Saunderson: I haven't read the report other than --

Mr Michael Brown: Your ministry's read the report.

Hon Mr Saunderson: Somebody called up from my ministry and asked that question: "What about the Sport Select?"

Mr Michael Brown: So your ministry hasn't considered the report.

Hon Mr Saunderson: As far as I know, the ministry has not read this report, but they did call to get a clarification on that, and there's no reason why we should have read the report. Our job is the implementation of machines, but not the watching over or the policing of them.

Mr Michael Brown: What about the proposal call?

Hon Mr Saunderson: What we did is we spoke to consulting and financial companies that had expertise in this area. We invited them to respond if they wanted to take a look at the implementation.

Mr Michael Brown: Can we have a list of those companies and corporations?

Hon Mr Saunderson: I think four companies responded. We could look into that. We'd have to come back to you later on in the process.

Mr Michael Brown: Can you provide us with the list of who was invited to make proposals?

Hon Mr Saunderson: We'll come back and answer that at a later time, but I want you to know there were four companies and we asked them to respond to us.

Mr Martin: I appreciated some of the comments that you made in response to some of the statements that I made and some of the challenges I placed in front of you, recognizing --

Mr Wettlaufer: They weren't challenges; they were errors.

Mr Martin: We all have our interpretation of the facts, don't we?

You did, Minister, and I appreciate it, give some credit and recognition to some of the work that was done previously by governments who with all good intention attempted to foster an environment in this province that was conducive to an economy that was positive and growing. I would suggest to you that some of what you're reaping today and taking credit for is a result of a lot of that. My concern is that the infrastructure that was put in place that we invested in that you no longer continue to invest in in the same way will down the road have some negative implications.

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What concerns me as much as anything re some of the information that you're presenting and the way that you're interpreting it and the view of it that you obviously hold close to your heart, the revisionist understanding of for example what happened in Sault Ste Marie and the ACR, that it was simply sold to an American interest and that was it, without recognizing that -- and this is an example of the way a government can work hand in hand with industry to make sure that we protect some of the very valuable infrastructure that could disappear if we simply left it to the whim of the private sector.

In Sault Ste Marie, the Algoma Central Railway, when we came to power in 1991, was bleeding to the tune of about $10 million a year. We propped it up for about two, three years and decided at that point that we couldn't do that any longer. The ACR didn't want to continue down that road, and the communities that were served by that operation weren't happy with the tenuous position that it always put them in. Certainly, the workers who hadn't had an agreement in two or three years were not happy either. Nobody was happy with the circumstances.

So we pulled together, everybody. I remember because I chaired the meeting up in Wawa where over 100 people sat down and looked at this whole situation and together came up with a plan that we then executed that, yes, saw at the end of the day, us bringing into the equation an American operator because at that time there weren't very many people interested in the ACR because the way it was running at that point in time just wasn't profitable.

But Mr Burkhardt, who owns Wisconsin Central Railroad, expressed an interest in that operation and came to the table with the government and with the union. One of the rules that we laid down in the whole negotiation that went on, and it was lengthy, and the government played a major role -- your interpretation of this was the government wasn't involved at all. I suggest to you that if it wasn't for the government, we would have no ACR right now running between Sault Ste Marie and Hearst. It would've disappeared because it was just not profitable.

We brought Mr Burkhardt to the table. We brought the communities to the table. We brought the workers to the table. We said, "What do we all have to do here to guarantee a future for this very important piece of infrastructure?" At the end of the day, a new agreement was negotiated between Mr Burkhardt and the ACR re the acquisition of the rolling stock, a new agreement was reached between the workers and Wisconsin Central and the ACR around new ways of paying people, new rules on the pension plan, that saw then this company turning the corner and, in the last several quarters in Sault Ste Marie, declaring a profit and in that way contributing very much to the economic stability of that whole corridor, Sault Ste Marie to Hearst, and contributing in a major way to the continued success of the other infrastructure, because it's all connected. Nothing operates in a vacuum. It's all integrated, particularly in the north, and I would suggest probably in the south too.

You made the comment, Minister, that under an environment that your government would have created, Algoma Steel and St Marys Paper and the ACR would not have got into the trouble that they did so that we needed to actually move in and assist in their restructuring.

Hon Mr Saunderson: I said that in the better economic climate that we're producing that wouldn't have happened.

Mr Martin: Could you describe that climate and how that would be?

Hon Mr Saunderson: Sure, I'm happy to, because first of all, I just think government interfering with business doesn't work and I can give you one glaring example that we're all suffering from ever since it happened and that's the OBI, which was a deal that was basically signed just before or just after the election, and it's not good. I'm going to go back, though, and tell you about --

Mr Martin: Excuse me, Mr Chair, if I might bring the minister back to the issue of Algoma Steel, not the OBI.

Hon Mr Saunderson: Sure, yes, I'm happy to do that. What our ministry has done over the last 16 months is that we've gone out and we've talked to all --

Mr Martin: Mr Chair, the question I asked was, what is this environment that would have seen Algoma Steel, St Marys Paper or the ACR not get themselves into the trouble they did so that it would have to be responded to --

Hon Mr Saunderson: You alluded to my sense of decency and fair play, and I'm going to ask you to just let me tell you what I see is the right way to handle things like that.

First of all, I think you have to establish relations with the financial community. You have to have established that -- it doesn't happen overnight -- and you've got to say to the financial community, "Look, if we're giving you the business climate that you want so that you can do well," whether it's the banks or whatever, then I say to those people, "Look, you've got to be more cooperative and more forthcoming to help out in difficult situations from time to time," providing they're financially viable.

Therefore, I now have, I think, the right relationship with the financial community. I'm not saying that only I could get it. It's easy to get, provided you go out and you talk to them and you don't shun those people. I shun no one in the business world -- most of all unions, by the way. I spent a lot of time working with the union movement in my business. You want to foster as good a business climate as you can, and that's having access to the financial institutions, being able to go to them and say, "Look, we've got to resolve certain things, as long as a company is viable."

We're not sure if some of those companies that you've talked about, in the long run, are going to be viable, but they are at the present time, and that is good. But what I've tried to accomplish in my first 16 months here with the people in my ministry is to build up the confidence of the business community who will come into those situations that you're alluding to and try to give their expertise and to help out. But I don't think there's anything that does it better than a proper business climate. That is the best way to keep businesses from getting into difficulty.

On the other hand, I don't think you should prop up businesses that are going to fail in the long run. I think that's what's happened in the past. It was going on for many years, by the way, long before we were elected. I'm talking many years, because we all thought the bubble would never burst. The fact is, governments were not putting things away for a rainy day, and that goes back a long way too, of all parties in all provinces and at the federal level.

But sooner or later it happened. We had a recession in the late 1980s and into the 1990s, which we're coming out of now. It was somewhat worldwide as well. But I think it is far better that you put funds away when times are good, you pay down your debts, you get your financial position strong, so that when times get better you can take advantage of the good times.

I think a lot of it is getting the business climate right, and I think that's what we're trying to do. I hope that's answered your question. But I think we -- my ministry -- have to go out there and work with all people in the business community, whether it's the banking system, whether it's the unions, whether it's the management, owners, you name it, and the universities etc. We have to work with all those people in my ministry, and we're trying to do that. People say, "What have you been doing for 16 months?" Look, we've been doing our work quietly. By the way, I don't play golf, so I don't have a chance to talk on the golf course; I'd much rather talk in the boardrooms, and that's what I've been doing.

Mr Martin: You haven't answered my question and you've come back with a very simplistic approach in a very complicated situation. It just isn't helpful.

I heard you also say something that rather disturbed me, and I'd like to hear you talk about it a little further. You suggest that Algoma Steel and St Marys Paper and ACR are not going to be viable in the long run?

Hon Mr Saunderson: No, I didn't say that.

Mr Martin: That's what you said.

Hon Mr Saunderson: No, I did not. I said --

Mr Martin: You did so say that. We'll check in Hansard tomorrow.

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Hon Mr Saunderson: I said we don't know what companies are going to be viable in the long run. Do we?

Mr Martin: No, you suggested that these companies --

Hon Mr Saunderson: You can't pick winners and losers.

Mr Martin: Well, we'll see. You're obviously picking these as losers, because --

Hon Mr Saunderson: No, I am not. I know Algoma Steel very well.

Mr Martin: -- in your perverted view of the world, the government --

Hon Mr Saunderson: That's not fair to say that, "perverted view of the world." I think if the Speaker was here from the House, he'd ask you to retract that statement.

Mr Martin: You said a couple of minutes ago that Algoma Steel, St Marys Paper and ACR were propped up by government dollars, and they weren't. They weren't. You don't know and you don't understand what happened there.

Hon Mr Saunderson: What do you mean, I don't work?

Mr Martin: I didn't say you don't work; I said you don't know and you don't understand what happened at Algoma Steel and St Marys Paper --

Hon Mr Saunderson: Yes, I do.

Mr Martin: No, you don't. I know by the comments you're making you obviously don't.

The Acting Chair: Mr Martin and Minister, let's not get into an argument here. Speak through the Chair --

Mr Martin: A few minutes ago he suggested, and I'd like to get it on the record here, that he didn't think --

The Acting Chair: -- and ask your question and the minister will answer.

Mr Martin: -- that Algoma Steel, St Marys Paper and the ACR are viable entities.

Mr Bert Johnson: No, he did not.

Hon Mr Saunderson: I did not.

Mr Martin: Well, let's look at Hansard tomorrow and see what he did say, Bert.

Mr Bert Johnson: You keep repeating it enough and then you'll believe it.

Mr Martin: No, no. We're going to look at it tomorrow and come right back here and we'll talk about it a bit more because that's a terrible thing for the Minister of Economic Development and Trade in this province to be saying about companies that are very viable right now and will be in fact some of the foundational pieces upon which the new economy in this province will be built. That's disturbing, Minister.

Hon Mr Saunderson: I think what you should understand is that I said governments cannot pick winners or losers. Nobody can do that. If that was possible, everybody would be very wealthy. I want to get that on record. I did not say that about those companies.

Anyway, we're talking about those companies. Isn't it good that they're doing well, and long may they do well. I'm just saying you cannot predict what will happen to companies and that's the point I was making. But there are many very good success stories in Ontario and I've outlined some of those in my remarks earlier today. As I say, I expect them to happen.

There is a very good feeling out there about Canada and about Ontario. Somebody said about interest rates, and it was from the Liberal side, that we could not take credit for the interest rates. We can take some credit for the interest rates coming down --

Mr Michael Brown: I think I said that.

Hon Mr Saunderson: Okay. Then I acknowledge that. But I think that the very fact of what's happening in the country is that people are now saying: "We cannot spend, spend forever. We have to get our fiscal house in order." We're part of that movement in Ontario and we're proud to be part of that movement.

But what happens is that word gets out around the world of what's happening in Canada, what each province is doing. Read the article in the Globe and Mail today when they talk about how people say Canada is turning. Well, we're helping it turn in Ontario, and all of a sudden people are saying, "My gosh, the Canadian dollar, maybe it's going to go to par with the American dollar." Wouldn't that be something if that happened? I don't think that's going to happen in the near future, but that's what they're talking about.

Mr Martin: I'll tell you, there's a lot of industry in this province that'll be negatively impacted by that -

Hon Mr Saunderson: Well, what people are saying, things are happening in this country through the provinces like Ontario that are giving us a fine reputation around the world as a good place in which to do business. It's predictable. No more legislation coming in that's just going to frighten business away from Ontario.

Mr Martin: I'd like my two minutes.

Hon Mr Saunderson: The deficit reduction that's going on in Ontario is a classic example. Now everybody's catching religion here on deficit reduction. The federal government is doing it and the provinces are doing it. We're part of that and we're proud to be marching along with those other governments.

Mr Martin: It's because of your silly tax break --

Hon Mr Saunderson: No, no. I'm sorry. Please don't call the tax break a "silly tax break" because the tax break is so essential to --

Mr Martin: If I might, Minister, because it's my time here --

Hon Mr Saunderson: Is it your time or my time?

Mr Martin: You're going on forever and you're off on a tangent and --

Hon Mr Saunderson: Well, I don't know about that.

Mr Martin: Well, you are. So I'd just like to --

Hon Mr Saunderson: You were talking about our silly tax break, and that has nothing to do with what you're talking about about competition.

The Acting Chair: Tony, do you have a question?

Mr Martin: I have a question, yes, because it reflects the misinformation and the misunderstanding that this minister has of the foundation upon which the economy of this province is built and some of the difficulties that the economy faced in the 1980s and into the early 1990s in Ontario.

I'll share with you a very difficult meeting I had shortly after I got elected to this job with the then owner and executive officer of St Marys Paper. He was going under; he was bleeding to death in an environment that was very much of a free market nature, and he blamed directly the level of the dollar at that particular point in time, which Mr Mulroney and the federal Tories were trying to keep unrealistically high, and he was also suffering big time because of the high interest rates at that time. Nothing to do with government intervention or a union problem or any of those kinds of things. It was the free market system at its best that was destroying that particular enterprise. That in fact is the story.

Hon Mr Saunderson: All I know, in response to Mr Martin, is I have read excerpts from Mr Rae's book and I can tell you that if I was a member of the NDP, having read that book, I'd be pretty ashamed of what they did to him and how uncooperative they were in situations that you were referring to. I think Mr Rae was hard done by by his party and that's what you're talking about here.

The Acting Chair: We have to adjourn until Tuesday afternoon.

The committee adjourned at 1756.