Legislative Assembly of Ontario

PRE-BUDGET CONSULTATIONS
SUBCOMMITTEE REPORT

CONTENTS

Thursday 21 November 1996

Pre-budget consultations

STANDING COMMITTEE ON FINANCE AND ECONOMIC AFFAIRS

Chair / Président: Mr TedChudleigh (Halton North / -Nord PC)

Vice-Chair / Vice-Président: Mr TimHudak (Niagara South / -Sud PC)

Mr TedArnott (Wellington PC)

Ms IsabelBassett (St Andrew-St Patrick PC)

*Mr JimBrown (Scarborough West / -Ouest PC)

Ms AnnamarieCastrilli (Downsview L)

*Mr TedChudleigh (Halton North / -Nord PC)

*Mr Douglas B. Ford (Etobicoke-Humber PC)

Mr TimHudak (Niagara South / -Sud PC)

*Mr MonteKwinter (Wilson Heights L)

Mr TonyMartin (Sault Ste Marie ND)

*Mr GerryMartiniuk (Cambridge PC)

*Mr GerryPhillips (Scarborough-Agincourt L)

*Mr GillesPouliot (Lake Nipigon / Lac-Nipigon ND)

*Mr JosephSpina (Brampton North / -Nord PC)

*Mr WayneWettlaufer (Kitchener PC)

*In attendance/ présents

Substitutions present/ Membres remplaçants présents:

Mr FrankSheehan (Lincoln PC) for Mr Hudak

Clerk / Greffier: Mr Franco Carrozza

Staff / Personnel: Ms Alison Drummond, research officer, Legislative Research Service

The committee met at 1546 in committee room 1.

PRE-BUDGET CONSULTATIONS
SUBCOMMITTEE REPORT

The Chair (Mr Ted Chudleigh): I'd like to call the meeting to order. Welcome back. It's been quite a while since we've had a committee meeting. I'd like to welcome the new members. Mr Pouliot, welcome to our committee.

Mr Gilles Pouliot (Lake Nipigon): Thank you, Mr Chair.

The Chair: I believe all others have been here before. Welcome to Mr Sheehan as a substitute, I believe. You haven't been appointed to this committee; you're a substitute? Welcome.

The agenda in front of us is for the adoption of the subcommittee report on pre-budget consultation review. I believe everyone has been distributed a copy of the subcommittee report. Would someone move the report?

Mr Wayne Wettlaufer (Kitchener): Excuse me, Mr Chair. Are you talking about the pre-budget consultation review?

The Chair: Yes.

Mr Wettlaufer: Mr Chair, the economic statement -- it says on page 3 of the report, "The subcommittee stated its intention that if the Minister of Finance was available he be invited to appear." That's not the process that's been in place for all these years. The system that's in place is that the minister would appear for the pre-budget consultations but not for an economic statement. I think we should keep the system in place, the process that is currently in place.

The Chair: For clarification, Mr Wettlaufer, are you suggesting that section B be deleted or be removed or be amended?

Mr Wettlaufer: I'm suggesting that it be removed.

The Chair: So your motion is to approve section A only?

Mr Wettlaufer: No, I'm not even approving section A. Under section A it says, under "Pre-budget Consultation Review, Presenters," "That the Minister of Finance be invited as the first witness, and that his ministry staff also be invited." The process has never had the Minister of Finance for the economic statement. The Minister of Finance only appears for the pre-budget consultations.

The Chair: Are you referring to section A now, or section B?

Mr Wettlaufer: In fact, both.

The Chair: I believe it has been normal -- in fact, it's probably imperative -- that the Minister of Finance be invited to the pre-budget consultation review as the first witness, as has been normal over the course of my experience and going back and reading the previous minutes. However --

Mr Wettlaufer: It's not a budget, Chair. It's an economic statement. There is no precedent for it.

The Chair: Part A refers to the pre-budget consultations. Part B refers to the economic statement.

Mr Wettlaufer: That's correct. I'm sorry. It is part B that I'm referring to.

The Chair: So A is okay and you would move the adoption of section A?

Mr Wettlaufer: Yes.

Mr Gerry Phillips (Scarborough-Agincourt): Just to comment, the process around here is quite different now than it was under the NDP, and actually under the previous government as well, in that it used to be that there was an economic statement and it was something like that, basically what's happening with the economy and the sectors and what not. What I think the new government has decided to do is have what it calls a fiscal and economic statement. Certainly that's what the government did last year, as you will recall; it wasn't an economic statement, it was a fiscal and economic statement.

The government has decided -- I understand why they do it, and it's quite legitimate -- to divide its fiscal package into two: the fiscal and economic statement now, and then the budget. Probably the fiscal statement is almost as important as the budget for this committee in that I gather it's the document, according to the Minister of Finance, where he'll outline the bulk of the expenditure reductions. That used to be done in a budget; now the government's doing it a different way.

For this committee, and I think we all want to be as effective as possible in trying to monitor the finances of the province and provide advice, the fall statement has changed dramatically. If you take the time to go through them, you'd see that the old ones used to be, just as I said, what's going to happen to the GDP and all that sort of stuff. Now the government has detailed fiscal plans in it. For us to do our job, I view that document as almost as important as the budget. It's the key document outlining the government's expenditure plans. I don't think it's out of line to once a year ask the finance minister to come and spend an hour with us on this and then an hour with us on pre-budget, so that over the course of the year we have two hours with the Minister of Finance.

We're all duly elected people, and this committee is designed to be the legislative committee looking at finance and economics. I would find it strange if we didn't feel that we were entitled to invite the Minister of Finance to spend a total of two hours out of a full year with us. As I say, I view the document that's coming out next week or the following week as almost as important as the budget.

Mr Gerry Martiniuk (Cambridge): On a point of order, Mr Chair: I understand there is not a proper motion before us to adopt the subcommittee report. I don't know what we're debating yet. What did he move?

The Chair: I understand Mr Wettlaufer moved section A of the subcommittee report.

Mr Martiniuk: To adopt section A? Okay. Sorry.

Mr Phillips: Well, I move the whole report.

The Chair: We've got one motion on the floor. We'll have to deal with section B at another time, I suppose.

Mr Pouliot: I fully concur with what my colleague Mr Phillips said. I'm not speaking in terms of political stripes, not from that premise in the least, but surely two hours is most reasonable. I think it's a matter for the person at the helm to come and help us in our deliberations. The committee is exactly within its mandate to expect, I would say, with respect, that the Minister of Finance be here.

Mr Wettlaufer: The economic statement is only an update. That's all it is. There is no sense in changing precedent.

Mr Phillips: I cannot believe the government members want to do this, that you are unwilling to invite the Minister of Finance to come and to explain what will be the most important document. If you want to defend that publicly, I will be surprised. I would think you are here to represent the public. We are a legislative all-party committee designed to hold the finances of this province up to a light. Are you saying to me that the Minister of Finance when he presents this document shouldn't be prepared to spend an hour with us? Is that what you're saying?

Mr Wettlaufer: I'm saying that it's an update on the budget from last year and the minister should be invited to the pre-budget hearings in the spring, as normal.

Mr Phillips: May I recommend that we send a letter to the Minister of Finance and let him make the decision rather than embarrass him by you making the decision for him?

Mr Pouliot: In my opinion, the reality is that this "update" will describe, will highlight, $3 billion worth of cuts. I don't find those words to be facile when you're talking of this magnitude. It's been mentioned by others, and I don't fully disagree, that what has begun tactically, strategically, is to separate the bad news from the perceived good news that a budget brings. We're not more candid than that.

I like what I hear in terms of, "Let him make a decision." An hour is not unreasonable. I find it most commonsensical. It's the right place to appear for the Minister of Finance. We're not talking about estimates. We're not talking about being overly partisan. When you're talking about $3 billion, I'm not that consequential that I can see it as a bagatelle, as an afterthought. I think $3 billion, in this day and age, is something the person on top has to explain. We need his wisdom and his help, and certainly an hour is most reasonable. I can't believe anyone would -- oh yes, I do, but I find it difficult that you want to shelter the minister. He's a grown-up now and he's more than able to defend himself.

Mr Monte Kwinter (Wilson Heights): I'd like to support my colleague's recommendation. This is going to be a significant statement of the fiscal policy of this government. It is not going to be a review of what has happened in the past. It's going to be a look forward. The speculation and the comments that have been made both by the Chairman of Management Board and the government House leader and the Minister of Finance indicate that this is going to be a statement of some significance. I think this committee not only has a right but an obligation to at least take a look at that as part of our pre-budget consultation.

Certainly the material that is going to be included in that statement is going to bear on the budget. The member for Scarborough-Agincourt makes a good point. I think we have an obligation to ask if the minister can appear to answer questions about the document, and he also has the right either to say yes or to say no. I don't think it's this committee's decision to say he should come or he shouldn't come. I can't understand any possible argument to say why he should not come. I can see where he could come up with an argument saying why he won't come or can't come, but I certainly don't think it's this committee's decision to say we don't want him. I can't imagine any committee on economics and finance presented with such a major document that does not want the opportunity to talk to the minister responsible.

I would recommend that we extend that invitation. Hopefully, the minister will comply, but if he doesn't, that's his decision. I don't think we should be making that decision.

Mr Phillips: This is very important to me. We're all elected. One of the roles we perform is to be on an all-party legislative committee. We have a duty and a responsibility. I just say that for the people of Ontario, this fiscal and economic statement is absolutely crucial. I cannot imagine this committee not wanting to have it before us. I can't imagine the government members, frankly, not wanting an opportunity to question the minister on it and to question the officials on it. If you say you sit on the finance and economic committee, I think it's very difficult to explain why the committee hasn't met now since the spring, because this is our key role. I can tell you I feel very, very strongly about this recommendation.

1600

Mr Joseph Spina (Brampton North): It's my understanding that what we're doing here is to set the agenda for the pre-budget consultations, which presumably take place in the spring. Is that the objective of the agenda we are on right now?

The Chair: That's section A of the subcommittee report, "Pre-budget Consultation Review," yes.

Mr Spina: Okay. So I'm having difficulty -- pardon my ignorance -- in understanding where the problem is, because when we get into pre-budget consultations, whenever, at that time we can get into it. If the minister makes his economic statement or his fiscal statement some time between now and the time this committee begins, that's the prerogative of the finance minister.

Mr Phillips: We had a subcommittee meeting. The members of the subcommittee agreed it was important to look at this fiscal and economic statement. It's absolutely crucial to the future of the province, and that's what you're here for. You're not here to take the orders from the minister. You're here to do the business of the public. I cannot believe what I'm hearing, that the government members are unwilling to have that issue before this committee. If that's what you're telling me, I'd like you to tell me that straight. You do not want an opportunity, shortly after the fiscal and economic statement is presented, to have it come here and to have an opportunity to discuss it. Is that what you're saying?

The Chair: Since this debate is really on section B of this report and the motion before the committee is to pass section A of the subcommittee report, could we do that section and then continue the debate on section B, with the permission of the committee?

Mr Phillips: I view it as a package. I don't know who's given you your marching orders on this, but for the members to not want to have a chance for this committee to discuss that document I think is wrong for the public. It's actually beyond my belief that you would do it. If all we can get is part A, then you can use your clout to do that, but I look across at you and I'll say to you, you're here to serve the public, not to shield the minister.

Mr Frank Sheehan (Lincoln): On a point of order, Chair: All that's been moved is section A. Section B shouldn't even be the subject of discussion.

The Chair: That's correct. There was a suggestion within section A that there be an extension of one week for the submission of invitees, which I believe has agreement. Would that amendment be acceptable to the committee? That's moved from November 21 to November 28 for the submission of the invitees.

Mr Pouliot: That's the three and 35, Mr Chair?

The Chair: Yes. Three lists of 35 and the three expert witnesses as well. With that agreement, all those in favour that I call the question?

All those in favour of section A of the pre-budget consultations review signify by raising your hands? Those opposed? It's unanimous.

Mr Phillips: I move section B.

The Chair: Mr Phillips moves that section B of the subcommittee report be adopted.

Mr Phillips: I assume from the comments that you don't want the minister here and we'll just proceed with the staff. Is that the intention?

Mr Wettlaufer: Yes, that it is the intention. We do not feel it is necessary for the minister to appear. It is an update; it is not a budget. He will appear before the committee. This is what we wish. We would like him to appear before the committee, as is the precedent, in the pre-budget hearings. It is our position that staff is adequate for the economic statement, which is merely an update.

Mr Phillips: I guess we'll deal with each part of it, then. I gather that the government doesn't want point 1, which is that the committee allocate the minister one hour and we'll just deal with the staff on it.

The Chair: Is that correct? Then would we amend?

Mr Sheehan: I move an amendment that we delete section 1 from section B.

No, hang on a minute. You can't amend it. You've got to defeat it if you want to have staff, because all the way through it refers to the minister.

Mr Phillips: No, I don't think so.

The Chair: No, I think we can amend --

Mr Sheehan: If you change administrative staff, that's a substantial change and effectively changes the concept of the motion and you can't amend it or you change the structure. If you change the essence of the motion, you can't do it.

Mr Phillips: I think you're wrong. It says the intent is, if the minister was available he'd be invited to appear, but that the committee nonetheless meet on the first Thursday after the Minister of Finance presents, and that the committee also invite the administrative staff to respond. If he's not available, we move on to points 2 and 3.

The Chair: And so stands the motion. Any comment?

Mr Martiniuk: I'm sorry. Do we have an amendment? There was an amendment moved to remove the requirement on the minister.

The Chair: The amendment was to delete the first point.

Mr Kwinter: Mr Chairman, part B states --

The Chair: Just a minute. I'd like to get the motion straight as to what we're voting on. We're going to give the government just a moment to --

Mr Sheehan: Mr Chair, the first point that the government doesn't want in here is item 1. The second one, though, refers to the minister, as contained in section 1.

Mr Phillips: No, it says after the minister presents to the House.

Mr Sheehan: But the minister is not coming.

The Chair: The minister presents to the House the economic statement.

Mr Sheehan: Good enough. Thank you.

The Chair: Okay. So we have the motion clear, we are voting on "Economic Statement," and the amendment is to delete the first section. That's what we will vote on now, when we're ready, as to whether we agree with the deletion of point 1. Would there be comment on that?

Mr Kwinter: Chairman, I don't understand the problem. There is a very clear indication that this would only be in effect if the minister was available. If the minister indicates he is not available, that's the end of his participation. It doesn't say that this committee insists that the minister come; it says that if he is available, this will happen. It is very simple. If he says, "I'm sorry, gentlemen, ladies, I am not available," that's the end of it. Then everything else falls in order. There's no allotment of an hour to him because he isn't there, but these other things continue to be in place.

So I don't see what is so threatening about this thing, because it isn't in any way compelling the minister to come. He can make his decision. If he says, "Yes, I'll come," or "No, I'm not coming," that's the end of it. I don't see why this committee should be second-guessing him. All part B says is if the minister is available, and it's his decision as to whether he is.

Mr Wettlaufer: The opposition and the third party have ample opportunity to question the minister on the economic statement in the House. I will restate the government position for the benefit of the opposition and the third party: that the economic statement is an update; it is not a budget.

The Chair: Further comment? Are you ready for the vote?

Mr Phillips: A recorded vote.

The Chair: A recorded vote, and we're voting on the removal of the first section of section B of the subcommittee report, on the economic statement. All those in favour of the removal of that clause?

Ayes

Jim Brown, Ford, Martiniuk, Sheehan, Spina, Wettlaufer.

Nays

Kwinter, Phillips, Pouliot.

The Chair: Now the motion itself, as it stands.

Mr Wettlaufer: It still says, "The subcommittee stated its intention that if the Minister of Finance was available he be invited to appear." The government side cannot support that.

Mr Phillips: I think we're just voting on 2 and 3 anyway. We just voted on 1. We vote on 2 and 3, which I don't think you have a problem with.

Mr Wettlaufer: We can vote on 2 and 3 if we amend part B to delete --

Mr Phillips: If it just says that the subcommittee meet on the first Thursday after, that's fine with me.

Mr Wettlaufer: "That the committee meet on the first Thursday after the Minister of Finance presents to the House the economic statement," and, "That the committee also invite the Ministry of Finance staff to respond to their questions"?

Mr Phillips: Yes.

The Chair: All those in favour? Unanimous.

Other matters to come before the committee? There being no further business for the committee, the committee stands adjourned.

The committee adjourned at 1613.