Ontario Public Service
Employees Union
Mr Bob Eaton
Ms Pam Smith
Canadian Union of
Public Employees, local 2204; Ottawa-Carleton Child Care
Association
Ms Shellie Bird
Ms Kathy Yach
Ms Rachel Besharah
Ms Sabina Lysnes
Ms Kasia LeBlanc
Ms Jo-Ann Hightower
Ottawa-Carleton
District School Board
Mr Jim Libbey
Mr Jim Grieve
Mr Ted Arnott (Waterloo-Wellington PC)
Mr Marcel Beaubien (Lambton-Kent-Middlesex PC)
Mr David Christopherson (Hamilton West / -Ouest ND)
Mr Doug Galt (Northumberland PC)
Mr Monte Kwinter (York Centre / -Centre L)
Mrs Tina R. Molinari (Thornhill PC)
Mr Gerry Phillips (Scarborough-Agincourt L)
Mr David Young (Willowdale PC)
Substitutions / Membres remplaçants
Mr John O'Toole (Durham PC)
Mr Richard Patten (Ottawa Centre / -Centre L)
Clerk / Greffière
Ms Susan Sourial
Staff / Personnel
Ms Elaine Campbell, research officer,
Research and Information Services
The committee met at 0900 in the Ottawa Sheraton
Hotel, Ottawa.
PRE-BUDGET CONSULTATIONS
The Chair (Mr Marcel
Beaubien): Good morning, everyone. I'd like to bring the
morning meeting to order. It is 9 o'clock. I hope everyone had a
nice weekend. Welcome here, Mr Patten. It's nice to see you.
Mr Richard Patten
(Ottawa Centre): Welcome to Ottawa Centre.
The Chair:
It's always our pleasure to come to Ottawa; it's nice and
cool.
ONTARIO PUBLIC SERVICE EMPLOYEES UNION
The Chair:
Our first presenters this morning are representatives from the
Ontario disability support program subcommittee, OPSEU. Could you
please come forward and state your names for the record. On
behalf of the committee, welcome. You have 30 minutes for your
presentation this morning.
Mr Bob
Eaton: For the record, my name is Bob Eaton.
Ms Pam
Smith: My name is Pam Smith.
Mr Eaton:
Good morning, committee members and honourable Chair. As I
stated, my name is Bob Eaton, and with me today is my colleague,
Pam Smith. I'm the OPSEU chair of the Ministry of Community and
Social Services employee-employer relations committee. Pam is the
OPSEU chair of the Ontario disability support program, a
subcommittee of MERC.
We are here today to educate
this committee and to provide a front-line perspective on issues
related to the provision of services to disabled Ontarians. In
our presentation, we hope to highlight the obstacles and
challenges faced by the disabled community, their families and
their service providers. We will indicate service gaps,
inappropriate resource allocation and suggestions for
improvement. We are here to advocate on behalf of our clients and
in fact on behalf of all forward-thinking members of our
communities. Thank you for granting us this opportunity and for
your attention during the next 30 minutes.
The Ministry of Community and
Social Services is the lead ministry when it comes to the
administration and provision of the majority of services for the
disabled. Within the scope of the MCSS mandate we are going to
examine the following programs: the Ontario disability support
program, the ODSP; assistance for children with severe
disabilities, ACSD; special services at home, SSH; and
developmental services. It is our submission that, at best, these
programs are woefully inadequate. At worst, their chronic
underfunding and lack of purposeful direction is an indication of
a paternalistic, archaic and inappropriate attitude toward the
disabled and their needs.
Each and every one of us in
this room knows and understands political process. We have all
heard government rants about special interest groups. We have all
heard about self-interested union bosses. We have all read in the
media accusations that friends of the government have made out
very well in the past five years. We cannot and must not allow
those dynamics to come into play during this debate. Disabilities
know no boundaries. Disabilities don't care about who you vote
for or how much money you earn. Disabilities aren't regional.
They have no preference for age groups. Disabilities don't
discern union from management. Disabled Ontarians are not a
special interest group. They are our mothers and fathers, our
brothers and sisters, our grandparents, our neighbours, our
friends, our children and our grandchildren. All of us are
vulnerable. An accident, a sickness, a medical mistake-all of us
are that close to being on the other side looking in. And if it's
true that a society is truly judged by the way in which it treats
its most vulnerable, then I'm afraid we're in for a fairly
negative evaluation.
Several months ago, families
had to go public with their plight as it related to the custody
and care of their children. In a civilized society, this is
simply unacceptable. No parent should ever be faced with the
choice of giving up their child in order that needed services be
made available. No ODSP client should have to retell their story
over and over again to a team within an office. They are entitled
to an identifiable, accountable case manager to supervise their
individual case. Clients should not die in an inappropriate
placement simply because bureaucrats determine that a zero
admittance policy to the province's remaining DS facilities
supersedes human need. Ministers should not make public
statements intimating the closure of directly operated facilities
when there are no viable alternatives available. Parents should
not be faced with a lack of available talent due to low wages and
lack of benefits and security when searching for respite or developmental care. No
parent should have to contemplate placing their child in
residential care just because they feel they can no longer cope
emotionally, physically or financially. And government policy
should not be made to exacerbate these problems. Rather, service
should be prompt, seamless, coordinated and, most of all, humane.
Only then can we suggest that we are on our way to a just, caring
and civilized society.
I'll now turn the floor over
to my colleague Pam Smith. She will walk the committee through
the presentation that we have prepared.
Ms Smith:
OPSEU brings a unique perspective to this table, as we represent
front-line professionals who provide direct services through the
Ontario public service and whose services are contracted out
through transfer payment agencies such as the Association for
Community Living. OPSEU members are dedicated to the notion that
disabled Ontarians are entitled to accessible, quality services
and benefits.
If we take a look at the
current fiscal climate spanning the budget periods from 1996 to
2000, Ontario government revenue has increased by 27.3%. With
such a substantial growth in revenue, OPSEU would urge the
government to reinvest in staffing resources within the Ontario
disability support program.
If you refer to the chart on
page 2, from the Ontario Outlook and Fiscal Review, you will see
that revenue has indeed increased and we are in a position-we
have been for the last two years-where there is a surplus. This
chart was obtained from the Ontario Ministry of Finance.
Background on the ODSP: in
June 1999 the Ministry of Community and Social Services assigned
staffing to the Ontario disability support program. The way they
came up with the ratio was one income support specialist, one
client services rep and half an income support clerk position to
every 500 clients on a caseload.
As well, in place of
traditional caseload management, the ministry introduced a case
pooling approach, whereby all cases were managed by an alpha
split. For instance, as an income support specialist, I would be
assigned cases whose last names began with the letters A to E,
and each month this would rotate, so we would not have active
caseloads. Income support specialists would rotate, and this was
a very confusing and frustrating situation for both staff and
clients. The result was program inconsistency and varying levels
of customer service.
Since the implementation of
ODSP, staffing resources have been woefully inadequate. This
results in clients waiting longer for services and benefits.
In July 2000, OPSEU compiled
a survey that was conducted on the business practices of the
Ontario disability support program. We sent a survey out to our
membership, and we had 29 offices reply. The survey was conducted
between June 1 and June 30. The results were pretty much
reinforced by ministry officials at our MERC subcommittee table,
who said their findings, from what we were saying, were pretty
much mirroring what they were seeing and hearing as well.
In September 2000, the
ministry, after a series of delays, finally released results of
their business process review. In a nutshell, all this review did
was take the same amount of work and develop new workflow
processes with the same amount of staff.
OPSEU was disappointed, to
say the least, in this management approach. While there is some
merit to some of the proposed changes, streamlining workflow will
not work the same in all offices. For instance, if you take an
office that has a large urban population, their needs and impacts
are very different from an office in the north or in rural
Ontario.
The ministry will argue they
piloted this new process in three ODSP offices. Pilots can serve
a purpose, if you are open-minded enough to accept the changes
and are willing to adapt the process and incorporate those
changes. Our position is that the pilots were rushed and provided
limited testing of the product. We feel these pilots were rushed
because the ministry has a contract with Andersen Consulting, now
named Accenture. The contract expires in January 2002. We believe
there wasn't adequate piloting of this new process. We see this
simply as a dress rehearsal for the new computer system, called
the service delivery model.
Under customer service
issues, we continue to raise issues around a client's ability to
access service in a timely manner with the implementation of the
integrated voice response system, which is a centralized service
to clients where they are given a PIN and can phone in to access
a limited amount of information on their files; for instance,
what their cheque will be at the end of the month or if their
case is ongoing or on hold, things like that.
On December 20, the ministry
indicated that 90,400 ODSP calls had been received from
integrated voice response. The premise was that this was supposed
to take some of the pressure off the local offices. What we're
finding is that clients, by and large, don't trust the system.
They are calling us to revalidate the information they've been
given. Also, the figures the ministry released were that 283,000
Ontario Works clients accessed the information as well. The
ministry was unable to clarify at that time, and has not been
able to since, whether this was representative of the number of
clients who used IVR or the number of calls they received. For
instance, was one client calling 10 times? Was that counted as 10
clients, or was that counted as one call? That hasn't been
clarified for us yet.
We have also indicated
repeatedly that many of our clients do not trust the system and
will not use the system. In addition, clients who have difficulty
with cognitive functioning skills will not be able to access this
service, nor will individuals who are blind or hearing impaired
or who are assisted by a trustee.
Clients who come into our
offices looking for service very often leave disappointed. For
example, a client who brings in a prescription for eyeglasses
requiring an authorization or a prescription for medication
requiring a drug card will be told that unless it's an emergency
this information will be
mailed out to them in two days. In the past, we would have
accommodated the client. They may have had to wait in the waiting
room for a few minutes, but we would have been able to
accommodate them.
Clients are being discouraged
from coming into our offices without an appointment. It appears
that all these measures point toward further office closures and
clients being forced to wait for their necessary services or
travel further to access those services. When you consider that
all our clients qualify for the program due to a disability,
their needs may warrant immediate service. Staff shortages are
having a catastrophic impact on client service and their
accessibility.
0910
As indicated earlier, we have
seen office closures: 65.5% of respondents to our survey
indicated they have witnessed closures of offices within their
various regions. This is problematic for staff, because they must
now commute further to work or commute further to provide the
service. It's also problematic for clients, who must travel
further. This is extremely unreasonable and is causing financial
hardship to those clients. As well, the impact on the clients'
ability to receive service in or near their home community is at
peril. This is a concern, especially in rural or remote areas in
Ontario that do not have access to public transportation.
Just over a year ago, the
ministry took over administering a program that we call mandatory
special necessities. This was previously administered by the
Ontario Works offices in the municipalities. Basically, it talks
about diabetic supplies, surgical and incontinence supplies and
medical transportation costs.
In December the ministry
announced they would be reviewing the administration of MSN, and
have introduced a new process whereby there is no longer a
verification requirement for travel claims less than $100 per
month. This is a major contradiction with the process. If a
client misrepresents or makes an error in reporting his or her
travel claim, there is no requirement to collect an overpayment,
as MSN is a benefit. In attempting to alleviate some of the
pressure of administering this new benefit, it appears the
ministry is frankly just buying some time while wasting valuable
taxpayers' money.
A very small percentage of
clients are aware of this benefit. We are making clients aware
during our update reports and when we're taking applications, but
by and large it's a pretty well kept secret. At a meeting in
January, the ministry admitted that approximately 8,700 clients
are making use of the medical transportation costs-are claiming
those. With a program that has expanded to over 190,000
households-and I stress "households," because you have clients
who are single but you have clients who are family members as
well. They may have two or three children, and their spouse is
also eligible. When you compound it by the numbers, it's
certainly more than 190,000 people. We anticipate a growing need
for not only medical transportation costs but also diabetic
supplies, surgical supplies and incontinence supplies. As a
result, the ministry, with its current ODSP staffing, cannot
possibly keep up with the demand for these benefits.
Next we want to look at
program standards. Program standards are what we are monitored
and evaluated on in terms of our job performance. We submit that
chronic understaffing and the sheer volume of work severely
restrict our ability to fully meet these standards.
The program's main
accountability standard right now is the consolidated
verification process. It's done every two years. That's when we
meet with the client and review their circumstances with them to
see if there are any changes, if there are arrears owing to the
client or if there is an overpayment or adjustment needed in the
benefit.
The target set for CVP
interviews is eight per week. As an income support specialist,
you can review eight files and have eight meetings with clients,
but you can never guarantee you will have eight outcomes. So the
premise is flawed. It's predicated on clients providing us the
information, and it's also predicated on things that are beyond
our control. For instance, Revenue Canada is supposed to be
sending us the most recent income tax data. This takes two to
three weeks, and we can't close the file without it. The client
may come to the interview and bring everything they need and show
us where they've received a pension in their bank book, but we
don't know if income tax is taken off at source. Therefore we
need something to verify the actual amount. All this takes time,
and we cannot make that target.
Also, people are expected to
travel in northern and rural areas to have interviews with
clients, and yet it's never accounted for in the targets. Another
other thing is technology changes. If we go out to an office that
doesn't have a computer system, we take the information manually
and come back and have to input it into the system. Once again,
there is no accounting for that in the outcomes.
Another standard is mandatory
special necessities. I talked a little bit about that earlier. We
have to ensure the documentation is there and it accompanies the
request. The volume of MSNs that we receive per day is
staggering. We anticipate that will grow. There's a very good
chance that we cannot and will not make the two-day turnaround,
and we are not in most circumstances, in most situations.
When a client applies for
Ontario disability assistance, applications are to be processed
within 21 days. Our sense is that we simply do not have enough
staff processing these referrals. A retroactive grant, where the
Social Benefits Tribunal has gone back a year or a year and a
half and we have to go back and recreate the data, makes it very
difficult as well.
This is a growth program.
There's a chart on the bottom of page 8 that demonstrates that.
These figures were provided to us by the ministry. Based upon
what we already know and what is being forecast, this program
will continue to grow to at least 11,500 more households over a
five-year period. Based upon the assumption that this has been a growth program
from the onset, or at the very least for the last two years, why
is the ministry not hiring additional staff? In fact, one may
postulate as to why 400 workers were laid off when the program
was initiated in 1999.
There's also the issue of
lost provincial revenue. Under ODSP, there are provisions for
family support workers to assist clients in obtaining child and
spousal support. Unfortunately, we are in a position where we
cannot enforce this part of the legislation, as there are no
family support workers in the Ontario public service. This
results in the ministry being unable to negotiate court orders
and agreements. Ontario Works FSWs, family support workers, are
supposed to be negotiating these agreements, assessing the
adequacy of support and representing the ministry's interests in
court. However, what is happening for the most part across the
ministry is that we are not pursuing support; we are simply
putting in a reminder to check support every six months. When
that six-month time expires, we are putting it ahead for another
six months. We submit that hundreds of thousands of dollars are
being lost each year because the ministry does not have employees
doing this function.
What's at issue with the
ODSP? As previously indicated, there are several issues that
point toward an increased staffing need for this program. In
order to provide quality customer service, process benefits and
application requests, and ensure program integrity and
accountability to the taxpayer, we need additional staffing
resources. There's a chart on page 10 that we've prepared
outlining the number of positions that we feel we require and the
cost for those positions, including benefits. These positions are
also based on the top of the salary grid. It's 248 additional
positions, and we feel that's minimal in terms of what is
warranted due to the increased workload and caseloads of the
ODSP. We are also recommending having reviews done annually in
all eight regions across the ministry to determine the need for
increasing these numbers.
Next, I want to talk about
assistance for children with severe disabilities. This program
was designed to assist parents with extraordinary costs needed
for caring for children with severe disabilities. To be eligible,
the child must be under 18 years of age and living at home with
either a parent or a legal guardian. Based on the family's gross
income, the assistance they receive from us can range from $25 to
$375 per month. If you look at the chart on the bottom of page
11, it's the consumer price index for Ontario cities ranging from
1989 to the present. There's been a steady increase in costs
since 1992.
Incidentally, that's the last
time these rates were reviewed. Neither the rates paid to
families nor the income testing levels have been reviewed since
1992. We submit that a review is long overdue. Families with
children who are disabled must reach farther into their pockets,
not only to feed and clothe them but also to get them the
services they require.
Caring for and raising a
child with a disability is a task that is difficult and compels
compassion. These families need reassurances that they can
continue to provide for their disabled children in the future.
Without an increase in funding and rates paid to individual
families, the future looks bleak indeed. Compared to the costs of
residential care, ACSD is extremely economical and also fits the
government's family first initiative.
The special services at home
program is not based on family income and is designed to assist
families caring for a child in the home with a disability or an
adult with a developmental disability. Some of the typical
services that are funded under this program include a worker
assisting families with bathing and feeding a child. A worker
will care for a child with a disability to give the parent a
break and will teach children with a disability to dress
themselves.
0920
What's at issue here is that
the funding provided to support workers is minimal. This presents
a problem as workers deem this work as a stepping stone or an
interim measure. At $10 per hour, these highly trained workers
usually move on when something higher-paying comes along. Low
wages always mean a shortage of available workers in this
demanding field.
This is frustrating for
families and children who must constantly get accustomed to
someone new. As well, it impedes the progress of the disabled
child or adult, who must continually establish relationships with
new workers. This becomes counterproductive and frustrating not
only to the disabled child and adult and their families but also
to the new workers.
To recruit and retain
qualified support workers, the ministry must increase funding for
these service providers. We recommend that support workers, based
on their qualifications, receive wages commensurate with their
skills and value.
Finally, I want to talk about
a bit about developmental services. There are three remaining
facilities operated by the Ontario public service. They are
Rideau Regional Centre in Smiths Falls, Huronia Regional Centre
in Orillia and Southwest Regional Centre in Blenheim. They care
for approximately 1,200 clients. There remains a great number of
high-needs, medically fragile people for whom community
placements would be inappropriate. Exacerbating this dilemma is
the rapidly aging population within our facilities. These folk,
their families and advocates certainly favour the least
disruptive option possible in terms of individual plans of
care.
The only responsible
recommendation is to advocate for an integrative, flexible and
portable service delivery system. There is indeed a role for both
community agencies and the three remaining directly operated
facilities. There must be an abolition of circumstances that
result in the perception that resources are somehow awarded to
one service delivery philosophy at the expense of the other.
Second, appropriate capital and human resources funding must be
allocated to this sector that has historically suffered from
chronic underfunding.
Within the three remaining
directly operated facilities there is a wide range of expertise
among front-line staff and
various practitioners. They must and can be utilized to fill the
gaps existing in various community services. Examples include,
but are not limited to, seating and feeding clinics, dentistry,
behavioural assessments and management, physiotherapy,
hydrotherapy, geriatric and long-term care, vocational training
and respite and emergency care.
The proposed model emphasizes
that Rideau Regional, Huronia and Southwest Regional centres be
designed and marketed as resource centres for the disabled
community. Additionally, the ministry would be assured the
retention of qualified, professional staff for the provision of
services. It would also safeguard against any unforeseen
breakdown in community placements.
Taking this suggestion one
step further, one could only entertain the notion that these
revamped facilities could play a significant role in the
long-term care of aged individuals otherwise confined to
expensive hospital wards.
I'll now turn this back to
Bob, who will lead us through the conclusion.
Mr Eaton: We
hope you've found our presentation this morning to be thoughtful,
informative and balanced. As front-line professionals, we are
absolutely committed to providing quality service to our
clients.
To recap our
recommendations:
Appropriate resources have to
be allocated to the ODSP in order to provide clients and
taxpayers with an accountable, identifiable case manager.
Ancillary positions must also be increased to compensate with
current deficits and expected growth rates.
ACSD benefit rates and
income-testing levels must be reviewed and adjusted immediately
in order to support families in their efforts to care for
children within the confines of the family home. Currently the
maximum rate is $375 per month, reduced according to income. At
$48,000 to $49,000 per year, a Toronto family at the maximum
level of support will see the ACSD disappear entirely.
Special services at home must
increase benefits so that they are commensurate with the need to
hire highly skilled, trained professionals to provide in-home
developmental services and respite care. Increased wages should
also attract more professionals into the field, negating the
current human resource deficit and competition for resources.
The government should make
capital investment into the province's remaining developmental
services facilities in Smiths Falls, Blenheim and Orillia a top
priority in the development of resource centres for the disabled.
There should also be a commitment made by the government toward
enhancing wages within the transfer payment sector in order to
solidify staffing complement. This would lead to achieving the
three Cs of care, commitment and consistency.
Though not part of this
paper, the government should immediately review its policy
vis-à-vis special-care agreements to ensure that our most
vulnerable families receive appropriate and timely
assistance.
Finally, the government
should commit itself to working with all stakeholders in a quest
to meet the mandate of providing programs and support for
disabled Ontarians, their families and their caregivers. An
annual forum dedicated to issues affecting the disabled would be
a positive first step toward creating a responsive, accountable
and seamless service delivery system.
Thank you for attention. We
would now welcome any questions or comments.
The Chair:
On behalf of the committee I would like to thank you for your
presentation, but there is no time for questions as you have used
the entire 30 minutes this morning. Thank you again.
CANADIAN UNION OF PUBLIC EMPLOYEES, LOCAL 2204 /
OTTAWA-CARLETON CHILD CARE ASSOCIATION
The Chair:
Our next presentation this morning, according to your agenda, is
from CUPE local 2204, Brockville, but it's also a joint
presentation, I'm told, with the Ottawa-Carleton Child Care
Association. Could you please come forward and state your names
for the record. On behalf of the committee, welcome.
Ms Shellie
Bird: Hi. I'm Shellie Bird from CUPE 2204 and this is
Jo-Ann Hightower from the Ottawa-Carleton Child Care
Association.
The Ottawa-Carleton Child
Care Association and the Canadian Union of Public Employees,
local 2204, Child Care Workers of Eastern Ontario, would like to
thank the standing committee on finance and economic affairs for
giving us this opportunity to present before you.
Together, our organizations
represent 50 child care agencies, which provide early learning
and care services to approximately 2000 families in the city of
Ottawa.
I'm going to be perfectly
honest. Our organizations spent considerable time debating the
usefulness of presenting before you today. We have made numerous
appearances before this and previous governments on the issue of
child care. And we are tired. We are tired that our plea for a
system of early childhood development and care services continues
to fall on deaf ears, despite the overwhelming scientific
evidence and the crying need for it. We are tired from trying to
maintain a high standard of early learning and care services
while this government financially cripples the regulated child
care sector. We are tired of trying in vain to respond to the
real and immediate needs of children and their families in our
community. We are truly at a loss as to what more we can say to
you in order for you, our elected representatives, to understand
and take action on the pressing need for early learning and care
services in this province.
We stand here before you
today and ask, how many more generations of children and families
will governments continue to fail? We have countless studies and
reports, and the findings of endless commissions, all stating the
need for a comprehensive government-funded and regulated system of early childhood
development and care services.
We have a number of people
who will be bringing forward the studies that go back more than
30 years.
Ms Kathy
Yach: Good morning. I'm Kathy Yach. I'm a member of the
of the OCCCA. Believe it or not, I'm 60 years of age. I was a
young child when the dominion-provincial wartime agreement was
signed and enabled 50% provincial-federal cost-sharing for
nurseries for children whose mothers were employed in essential
war industries.
Ms Rachel
Besharah: I was a baby when the Royal Commission on the
Status of Women recommended a national daycare act and funding
for a universal child care system.
Ms Sabina
Lysnes: My name is Sabina and this is my daughter Anna,
who's in child care. In 1974 I was a young child when the Day
Care Reform Action Alliance successfully fought the Birch
proposals, the provincial government's proposed reduction in
staff-child ratios and other standards reductions to reduce
costs.
In 1985 I was in elementary
school when the Rosalie Abella report of the Commission of
Inquiry on Equality in Employment called for the establishment of
a national system of child care to support families in their
parenting roles.
Ms Kasia
LeBlanc: In 1986 I was two years old when the Katie
Cooke report called on the federal government to establish a
national system of child care services.
In 1987, the New Directions
for Day Care government policy initiative promised a
comprehensive policy that recognized child care as a basic public
service.
0930
Ms
Besharah: My daughter Olivia was two years old when the
Ontario Royal Commission on Learning called for a
government-funded and regulated system of child care.
Ms Bird:
In 1999, the recommendations from the study Our Child Care
Workforce: From Recognition to Remuneration called for adequate
government funding and regulation for early learning and care
services, and we are hoping that these recommendations will be of
benefit to this generation of children.
Ms
Besharah: The provincial study The Early Years
envisioned the development of a system of early child development
and parenting centres to support children from conception to
formal school entry, as well as their families.
Ms Jo-Ann
Hightower: The first recommendation of the provincial
government's Education Improvement Commission called on your
government to strengthen its commitment to Ontario's children by
ensuring their access to affordable, high-quality child care
programs and excellent standards of nutrition, health care and
safety.
We've had enough reports,
commissions and studies. We've done enough pilot projects. You
have more than 30 years of research right here before you,
including your own Early Years study, that tell you what
government must do to ensure that children are healthy, safe,
socially engaged and ready to learn.
UNICEF's State of the
World's Children 2000 report urged all governments to act,
calling effective investments in health, nutrition, education,
child care and basic protection both a moral imperative and sound
economics.
We've got homegrown
examples in Quebec and British Columbia of how to deliver a
provincial system of early childhood development and care
services. In Ontario, we've got a booming economy and a
provincial budget surplus. There is no excuse for denying more
than 70% of young children in this province the kind of early
learning and care services that we know best support their
healthy development.
We are asking this
committee to recommend substantial provincial investments into a
comprehensive system of early childhood development and care
services similar to those in Quebec and British Columbia. To
achieve this goal, we ask that you use the $844 million in
federal money over the next five years as a portion of the
funding required to implement a universal system of early
childhood development and care services.
History should tell you
that this is an issue that's not going to go away. No matter how
many governments choose to sidestep, study, negate and avoid
this, it is not going away. It's not going away because we live
in an economic order that requires more and more parents of young
children to work. Their child care needs are real and
pressing.
You've got all the research
you need to tell you what to do. Maybe a few words from a parent
will remind you why it is important for government to invest in
children and their families.
I would like to reintroduce
Rachel Besharah. Rachel is a parent of a young child named
Olivia. She has agreed to present today because she thinks it is
important that you understand what regulated high-quality child
care has meant to her and her family.
Ms
Besharah: Hello. I'm Rachel Besharah. I'm here today
because I think it's important for this committee to hear from a
parent what parents need. I know I speak for many families when I
say that almost all of us need child care at some point in our
lives. Whether it be our own children, grandchildren, nieces or
nephews, the need for child care at some point touches most of
us.
My daughter Olivia is five
and, I am proud to say, has been in daycare since she was four
months old. When Olivia was born, I was a student barely
surviving on OSAP with a partner who was earning below the
poverty line. I was fortunate enough to be offered a child care
space which enabled me to continue with my studies. I missed her
all day long, but was greatly comforted when I would arrive to
pick her up every day. Olivia was thriving in a learning
atmosphere that was nurturing and educational with trained staff
who supported the whole family.
Reassured in the knowledge
that Olivia was in the hands of caring professionals guided by
standards and regulations, I was able to go to school and focus
on my studies rather
than worry about my child care arrangements, as many parents do
daily. As a parent I can't express enough what it meant to me to
have trained and knowledgeable staff to talk to about any
concerns or questions I had about Olivia's development and
behaviours. They were a tremendous resource for my partner and I
and they helped us to be better parents.
Without child care, I would
not have been able to finish my studies and graduate with
honours. I would not have been able to enter the workforce and
become self-reliant. I would have had to have stayed home with
Olivia, dependent upon the system, which I know is not what this
government wants.
While still in school, the
child care subsidy I received helped me to keep my head above
water. Now that I have entered the workforce, I am a
full-fee-paying parent who struggles with the high cost of child
care. Despite struggling, this is the type of care I choose for
my daughter, and I will continue to pay for what I value.
What parents need is
affordable, accessible child care, not tax breaks. Parents need
this government to invest in a provincial system of early
learning and care services.
Ontario families are
hearing more and more about the Quebec and BC provincial child
care systems. It's time for the Ontario government to make that
same commitment to its children and its families. The
professionals have told you time and time again what early
childhood education provides for in the early years. They've also
reminded you of how it supports children in their later years.
Please listen to those studies, but also listen to the parents.
Despite needing to work to survive, raising my daughter is the
most important job I will ever do. I'm asking you to support me
and the other parents of this province to feel a little less
burdened of the worry that we are good parents, that we are doing
what is best for our children in helping them to reach their full
potential.
Am I fortunate? Yes, I am.
Do I feel privileged? Yes, I do, to have been so lucky to access
this early childhood education for my daughter. But I strongly
believe that early childhood education should be a right for all
families and children. In our growing economy and the provincial
budget surplus, it is no longer a matter of money; rather, a
matter of political will. Please show us that you have that will
in supporting Ontario families to be what they want to be.
Ms Yach:
May I remind you that in 1999, the You Bet I Care federal study
was the second national study to examine the relationship between
staff wages and working conditions and quality child care. Both
federal studies came to the same conclusion: while child care
workers are the cornerstone of a quality system of child care in
Canada, their needs for adequate wages and working conditions
have largely been ignored, and that without focusing attention on
those who care for a living, a system of quality child care in
Canada cannot be realized.
Ms Bird:
Thank you very much. Questions?
The Chair:
We have approximately six minutes per caucus, and I'll start with
the government side.
Mrs Tina R.
Molinari (Thornhill): Thank you very much for your
presentation. It's certainly nice to see the little ones here as
well this morning. It adds to the impact of your
presentation.
As a government, we
certainly are concerned with the welfare of our children, and
certainly they are our future. There have been a number of
initiatives proposed in the last little while to support
children. One of them is the early years challenge fund. I must
put on the record that the government will invest up to $30
million annually to support communities in early learning
initiatives.
You've made a number of
recommendations in your presentation that certainly will be taken
into consideration with all of the others that come forward.
As I said, a number of
initiatives have come forth, and I don't know whether your group
is aware of all of the new ones and is taking advantage of them.
But since 1995, funding for child welfare, children's aid, has
increased by 80%, to over $650 million, allowing children's aid
societies to hire 1,000 new child protection workers; and the
support to the Invest in Kids Foundation, which supports
prevention and early intervention initiatives for high-risk
children. Over 5,000 children and their families in eight
communities benefit from the $5-million annual commitment to
Better Beginnings, Better Futures prevention program. These are
just a few of a number of initiatives that this government has
taken and moved forward on.
Our Minister of Community
and Social Services is in constant consultation with groups such
as yourselves and others that put forth very valuable
recommendations on how we can continue to improve with new
initiatives for child care, and certainly regulated child care
centres make families, and moms for the most part, feel
comfortable leaving their children there and, as stated by one of
the presenters, being able to study and be in school and not have
to worry about the welfare of your child. So certainly a number
of the recommendations you've made here are going to be taken
into consideration.
0940
I sense your frustration in
your opening comments about the number of times that you've made
presentations to committees, but please don't be discouraged by
the results that don't seem to be at times doing everything that
you put forward, because as a government we're in the challenging
position of having to balance all of the recommendations and all
of the initiatives and needs from various communities and then
make a decision on what works best for the final picture. It's
difficult for us to make decisions that make everybody happy, but
certainly as a philosophical view we are concerned and do what we
feel is best to move in that direction, and presentations like
yours certainly help turn the light on in a number of other areas
that we might not have considered in the past and certainly will
have to look at for the future.
Ms Bird:
In response to that, 70% of children in this province and across
the country require access to non-parental child care
arrangements. When all of the studies are in that tell and demonstrate the need for a
regulated, high-quality child care system, your government has
cut more than $70 million from the regulated child care sector.
Child care funding per child has decreased 15% since your
government came to office. There does not seem to be a commitment
to child care and the early years fund does not provide any
monies for expansion of child care, for increased subsidies to
parents. In fact, it's the opposite. There has been a real
pulling away from regulated quality child care by this government
and it's a real concern. Centres are struggling and barely
surviving under your government in their attempts to provide good
care, the kind of care that we know benefits children and
supports families. Your government has done everything that moves
away from that.
The Chair:
With that, we've run out of time. The official opposition.
Mr Patten:
Thank you for coming out this morning, Shellie and everyone else,
and all the children.
Shellie, in response to
your last comment, that's my impression. The government of the
day did do one thing: it did launch the Early Years Study, which
I think was a great study in pulling together a lot of research.
I think it still is. It stands up today and it's certainly a
cornerstone for action. They have taken a number of tiny
initiatives in looking at possible models etc, but in facing the
overall situation on child care support for children and families
it they have not.
As you know, as former
children's critic I have some knowledge about this and some
interest in this area. When you talk about the Quebec model and
the BC model, I know in the Quebec model this is something over
time; this is not implemented in one year. We're not talking
about $10 million, we're not talking about $30 million; we're
talking a couple of hundred million dollars, of rearranging
priorities that get at helping children and families to have the
support they need in the interests of a long-term investment in
the greatest resource that we have as a society, which is our
human resource. Interestingly enough, when you talk to people in
the sector that up until last week was the most dynamic
sector-I'm just joking, of course-what people call
euphemistically the high-tech sector, the single-greatest
resource is our human resources. That means we must invest in our
people, we must invest in our children.
Given that context, can you
describe a little more, please, a more comprehensive system, not
just throwing $5 million over here or a few dollars over here for
a continual, perpetual pursuit of studies that seem to never go
anywhere in a comprehensive manner.
Ms Bird:
What we're looking at, and it's been put forward over the years,
is the hub model, and it was also recommended in the Early Years
Study about the parent centres. What we see it as is child care
as the backbone to a comprehensive basket of services for
children, with child care being the underlying thing upon which
it rests.
The parenting centres that
were proposed in this report are part of that, because we do
recognize the need to support parents and children, and it is
being done in Quebec, where families are being supported directly
by the government. It is comprehensive, flexible licensed home
care, group child care. It's to meet parents' needs, because we
have a long way to go in creating flexibility within the system
and ensuring that parents who work shift work, weekends and
part-time have access to child care. That needs to be built into
the system. Does that answer your question?
The Chair:
We've run out of time. Mr Christopherson.
Mr David
Christopherson (Hamilton West): Thank you very much for
your presentation. I believe it's the second presentation we've
heard.
It's almost a shame that
you can't be with us for all the hearings, because there are
quite a few groups that come in, especially on the business side,
that are thrilled with this government. They spend the better
part of 30 minutes singing their praises, telling them what a
wonderful job they're doing, "Please keep cutting taxes; we're
getting richer and richer and the world is getting better and
better," yet every group that comes in that deals with anything
other than just the bottom line starts to talk about, if not the
devastation, certainly the deterioration of services-education,
health care, environmental protection, child care, right across
the board-so we can see who the winners are and who the losers
are in Ontario, and it's a shame it has to be that way.
I'm glad you pointed out
Quebec because, interestingly enough, Quebec was also pointed out
to us by the Ontario Federation of Agriculture as being a
province that supports their agriculture economy twice as
strongly as the Ontario government does, and yet they also have
this child care. The reason it's important to raise that is that
right now it seems like this government puts forward what they
consider to be the only alternative there is, that there's no
other way to do business. Yet, there's Quebec with a strong,
thriving economy putting resources into areas that need it, such
as agriculture, and then they have cutting-edge, leading
legislation in the area of child care. So I urge you to keep
using that as an example because the government likes to say and
pretend that those of us who would support these kinds of
programs don't know anything about business, couldn't run the
economy, and the only thing that really works is to follow the
economic plan that they're following. We know differently. We
know that's not the only way to approach an economy.
One of the things that
wasn't raised too much here yet, and I understand why, and that's
why I want to do it, is the whole issue of the wages that are
being paid to early child care educators. If someone would just
touch on that, because it's shocking when you think about the
amount of education and experience and responsibility an
individual has versus what they're being paid.
Ms
Hightower: I'd just like to comment on the fact that we
don't know how to deal with the bottom line. If you talk to a
child care worker, they can tell you 365 different uses for an
egg carton in child care. We are really, really good at budgeting
and we've been dealing with shoestring budgets for a very long
time.
I worked in a centre a number of years ago where I
used my paycheque, the very minimal paycheque at that point as
well, to buy supplies so the children had something to do every
day. It wasn't because the owner of the child care centre didn't
have a desire to provide the best quality program that she could;
it was because the budget was so very minimal, and budgets still
continue to be minimal. As an example, I'm just finished the
process of doing my annual budget for this year and I haven't had
a raise for my food costs since 1991. We are providing three
healthy portions of food in the run of a day for $1.64 per child
per day. That's not a lot of money.
I'm going to let Shellie
talk to you about wages. She's a little better at that than I
am.
Ms Bird:
Across the province, child care workers have not been seeing
wages increases. In the last study our wages were compared to
parking lot attendants', and I think it really is indicative of a
government that would leave people who provide a critical service
in our community earning the same as somebody who watches a car.
Even though we talk a lot about how we value children, how we
value those who work with children, we don't show it. We have not
had a wage increase in six years and we weren't making that high
a wage to begin with.
It is near to impossible to
draw people into the child care field any more because the wages
are so low. You come out of college with a huge debt and you're
earning minimum wage and slightly above. It is a real problem to
ensure that children are being cared for by trained,
knowledgeable staff when governments are not prepared to
adequately compensate them. It's a huge problem, and it's a huge
problem to keep highly qualified, caring people in the field.
0950
Ms Yach:
Can I just add one comment? You were talking about businesses,
and I think all the different parties need to think about the
issue of shift work. All of us here in Ottawa know of Nortel and
JDS. They have shifts that run from 7 to 3 and 3 to 11, and they
need adequate care during those shift hours. I think that's one
thing the government has not looked at. We need funding for that.
We need to have a cook over the supper hour, we need to have
someone to follow through, and we need to come to terms with the
money we need for that. So when you've finished your studies
here, I hope you will consider the issue of high-tech and the
need for shift work.
Mr
Christopherson: I would come back to "unregulated." I
think there are a lot of individuals, possibly members of the
Legislature, who don't truly understand the difference between
regulated and unregulated. If in the business world you start
talking about regulation, they have nightmare visions of all
kinds of red tape and hoops and bureaucrats and paperwork etc. In
this case we're talking about the difference between an
enforceable, monitorable, if that's a word, set of standards that
guide how the children are to be cared for. When we get into
unregulated, we're talking about grandma and grandpa, which
normally isn't a worry for someone, and even if it's a
sister-in-law, brother-in-law, things like that, there isn't that
much worry, although that can be a problem. But it could be just
somebody down the street, and someone who is desperate will take
whatever they can, and if they believe their child is taken care
of the best they can possibly do, they can go off and earn enough
money to at least put food on the table.
Personally-and I'd like
your thoughts on this, if you can-I fear and dread the day that a
child dies in an unregulated child care setting and then all of
this comes tumbling out in a coroner's inquest. At some point we
will reverse the trend, but you have to ask yourself how many
innocent young children have to be hurt or perhaps die before we
get the message that unregulated versus regulated can often mean
the difference between life and death.
Ms Bird: I
guess what we need to really look at when we're talking about
this issue is that there is good unregulated care out there;
there is bad unregulated care out there. If this government wants
to put money out into the regulated sector, which is a growing
trend of the provincial government, I think it behooves them to
ensure that the taxpayer money is going to buy regulated child
care instead of care of unknown quality. It is criminal to just
throw money out into the community in the name of children with
no regulation, no accountability. It's not good for children and
it is not accountable to taxpayers to just throw money out into
the unregulated sector.
That is what this
government is choosing to do with child care: throw it out into
the unregulated sector, give parents a little bit of a tax break
through the Ontario child tax benefit, which I think is a maximum
of $1,100 a year, which is not enough to buy child care. So
parents are left scrambling and having to live with whatever they
can find out there. This government is very irresponsible in
seeing that as a way of dealing with our child care needs. It
really lacks vision.
The Chair:
We're out of time. On behalf of the committee, thank you very
much for your presentation this morning.
OTTAWA-CARLETON DISTRICT SCHOOL BOARD
The Chair:
Our next presentation is from the Ottawa-Carleton District School
Board. Could you please come forward and state your name for the
record. On behalf of the committee, welcome.
Mr Jim
Libbey: Thank you, Mr Chair. I'm Jim Libbey, chair of
the Ottawa-Carleton District School Board.
Mr Jim
Grieve: I'm Jim Grieve. I'm the director of education
for the Ottawa-Carleton District School Board.
Mr Libbey:
Mr Chair, members of the committee, ladies and gentlemen, on
behalf of our 80,000 students, we very much appreciate this
opportunity to explore with you the funding issues facing Ontario
school boards.
I would like to start by
acknowledging the improvements the government has made to various
aspects of public
education. These include a new curriculum, the Education Quality
and Accountability Office and the strengthening of school
councils, to name just three. The recent creation of the Task
Force on Effective Schools confirms the government's commitment
to continuous improvement in public education.
My approach this morning
will be to review briefly the recent history of education
finances in Ontario to establish the context within which the
current serious underfunding of public education in Ontario can
be understood. I will then outline some of the more significant
financial challenges that school boards face by analyzing
specific shortcomings in the funding formula.
You will notice two
important things. First, the issues raised pervade the funding
formula; it is not that just one or two errors need to be
corrected. This is not surprising, given the real underlying
issue: the government has significantly reduced the total funding
allocated to elementary and secondary school operations. Second,
all Ontario school boards face the issues raised in our brief.
You will hear this from others as you tour the province. The
severity of a problem will vary from board to board. Our board is
more challenged than most in areas such as special education,
English as a second language, French as a second language,
transportation, and new school construction.
So what is the historical
context? In simple terms, there were two critical events. The
first was the decision to ensure fair and non-discriminatory
funding to all Ontario school boards, regardless of their tax
assessment base. This decision was widely applauded, even by us,
although it cost our board some $50 million in grants.
Second, the government
significantly reduced operating funds for elementary and
secondary education in Ontario. This cost our board an additional
$35 million, approximately. Although some of that original cut
has since been restored, province-wide operating funds continue
to be significantly below their 1997 level of $13.7 billion.
Excluding phase-in funding and capital grants, student-focused
funding for the current school year is projected to be some $12.4
billion. That is a reduction of about $1.3 billion, or 9.5%, not
taking into account inflation. It is little wonder that the
Ministry of Education is having great difficulty developing a
sound funding formula when there is so little money available to
them for school board operations.
The issues related to new
school construction are complex and seem to differ from board to
board. The government has arranged a significant amount of
investment in new pupil places for some rapidly growing boards.
However, as I will describe, the rigidity of the formula has
prevented us from building some desperately needed new
schools.
How much to invest in
education as compared to health, social services, infrastructure,
lower taxes and so on is, I suggest, the essential public policy
question for your committee. We have been very encouraged in
recent months by the clear evidence that has emerged in favour of
investing in education. Business leaders in Ottawa and our
municipal politicians have rallied to the cause of education.
This afternoon, you will
hear a presentation by the Ottawa Economic Development Corp that
will explain why they have ranked education as the number one
priority for our community. A new study sponsored by the Canadian
Advanced Technology Association reports that Canadians rate
education as the top issue for high-tech leaders to promote. Why?
Simply put, competent, skilled citizens are essential to our
long-term prosperity.
We have four
recommendations for the committee.
First: that funding for
elementary and secondary school board operations in Ontario be
significantly increased by an amount that reflects the issues
raised in this and other presentations, and more generally to
reflect the real costs that must be incurred to provide
high-quality education.
Second: that the Ministry
of Education amend the general legislative grants regulation so
that the increased funding is allocated to Ontario school boards
to meet both the needs that are common to all boards and the
unique needs of certain boards.
Third: that the Ministry of
Education implement a zone model for determining the allocation
of grants for new pupil places and new schools.
Fourth: that the 2003
review of the funding formula required by the Education Act
commence immediately and include extensive consultation.
The rest of my presentation
will focus on the implications of inadequate funding for the
Ottawa-Carleton District School Board alone.
Since amalgamation on
January 1, 1998, we have worked hard to live within the financial
parameters established by the province. We have been, and will
continue to be, creative and active in tapping new sources of
revenue and operational efficiencies to accommodate the formula.
For example, upon amalgamation we reduced our administrative and
plant costs to be within the formula requirements immediately. We
have maintained extremely restrictive transportation policies. We
have undertaken vigorous energy management programs. We are
establishing a charitable foundation to encourage philanthropic
support for public education in the nation's capital. We use
value-for-money audits to identify improvements in business
practices. We have forged significant partnerships in the
corporate community for services, equipment and learning
experiences.
1000
To date our funding and our
budget have been reduced by $61 million from pre-amalgamation
levels. We are within all non-instructional grant envelopes and
have cut significantly into instructional costs, including
special education and English as a second language. Any further
cuts can only come from direct spending on students in the
classroom, which we believe to be contrary to the intentions of
the government.
Dollar amounts in this
brief are rough estimates based on the general legislative
grants, excluding mitigation grants, approved for our board for
the current year, which total approximately $480 million. This amount
includes no provision for new capital projects.
It is important to
appreciate that we are not requesting an extended mitigation
grant. Mitigation grants were intended to temporarily assist
boards with the transition to the new funding formula. We require
fundamental and permanent changes to the funding formula
itself.
The needs for increased
funding described in this brief are no wish list. They represent
the minimum required to maintain public education in Ottawa at a
reasonable standard. Other program areas that should be enhanced
as part of the review of the funding formula include library
services, guidance, school support staff, supervision of students
and classroom assistants.
You have before you,
attached to your document, two tables that summarize the
shortfalls we face if the investment in education is not
increased. First, let's look at some of the challenges related to
our operating budgets.
Salaries and benefits
funding gap: Teachers and other staff in schools are covered by
collective agreements which dictate how much they must be paid.
However, the current funding formula, the only source of funding
for these mandatory costs, is based on proxy salaries and
benefits per person that are significantly less than what we and
other Ontario boards must pay. For example, educational
assistants cost us $34,000; the funding formula provides only
$26,000. This gap has existed since amalgamation and increases
with each contract settlement. To date, mitigation grants have
helped to cover this gap. They are set to expire this year.
Our staff recently
presented an analysis to the Ministry of Education that indicates
a shortfall in funding for salaries and benefits of approximately
$12.8 million.
Staffing for special
education: The level of service we can provide to our
special-needs students with fewer staff under the funding formula
is unacceptable. Under the watchful eye of our highly competent
and experienced special education advisory committee, or SEAC, we
have attempted to implement a new delivery model that puts more
emphasis on integrating special-needs students into regular
classrooms. But students' needs are not being met. In fact, less
than two weeks ago, SEAC unanimously endorsed a response to a
staff report on a review of special education. The SEAC report
included the following paragraph:
"The special education
advisory committee of the OCDSB believes that the time has come
to acknowledge the problems we are facing, to acknowledge that
too many children are slipping between the widening cracks
created by inadequate special education resources and to identify
what resources are absolutely necessary if all of our students
are to be successful."
These issues are very
complex. We need clear provincial standards for special education
program delivery. We need a common understanding of the costs of
special education services. We need a funding formula that can be
administered successfully and efficiently. We must be able to
differentiate the requirements of one board compared to
another.
What is clear is that
success in special education does not benefit just our
special-needs students; rather, it benefits all students and it
contributes to the prosperity of the province.
Assuming the salary gap is
corrected, our preliminary estimate is that special education is
underfunded by approximately $4.7 million.
English as a second
language: Like Toronto, but unlike most of the rest of the
province, Ottawa has a significant and growing multicultural
population with high needs for English as a second language.
These needs increase each year, as the city experiences the
fastest growth of any urban area in the country and one of the
fastest growth rates in North America.
It is critical to the
economies of both Ottawa and Ontario, and it is in keeping with
the province's own policy of equal access to quality education,
that our ESL students be allowed to achieve their personal best
on a level playing field. More than 12% of our enrolment, or
9,700 students, need ESL instruction. The provincial government
provides program funding for only 30% of those students. Our ESL
students, and therefore our community, are being shortchanged. We
estimate that ESL is underfunded by $3 million.
French as a second
language: More than any other city in Ontario, Ottawa has a major
responsibility to provide French-as-a-second-language training to
all its students. The unique character of our city is reflected
in job requirements for bilingualism demanded by employers in the
service and retail sectors, public institutions, and of course
the federal government. To help meet this requirement, our board
begins core French in senior kindergarten rather than in grade 4,
as dictated by the funding formula. The formula approach is
insufficient for our nation's capital. The needs of our board
exceed those of other boards in Ontario in this respect. We
estimate that French-as-a-second-language programs are
underfunded by $3.8 million.
Occasional teachers: The
budget for occasional teachers is rising, due primarily to the
increased workload of secondary teachers who, under the
province's new mandatory teaching times, are no longer available
for as much on-call and supervisory duty. This affects both
student achievement and safety in our schools. We need an
increase of $4 million to cover our actual occasional-teacher
costs.
Supplies and materials: The
simple but unavoidable fact is that textbooks and school supplies
are lacking in many schools. At the same time, more and more
student fees are being charged and families are being asked to
buy more of their children's school supplies. Parents are
becoming openly impatient and resentful that the wealthiest
province imposes what amounts to extra taxes to furnish basic
classroom materials such as textbooks, pencils and paper. We
estimate that to provide essential classroom materials, $3
million must be added to our funding for supplies and
materials.
Transportation: Our two
predecessor boards operated very efficient transportation
systems. We have been essentially frozen at those super-efficient
levels, while others, including our coterminous English Catholic
board, have been frozen at far more generous levels of funding.
So it's not surprising that the Catholic board is reluctant to
participate with us in arriving at transportation solutions. As a
result, fewer of our students are entitled to transportation and
many must walk much further to their bus stops and suffer the
impacts of triple and in some cases quadruple busing, including
irregular opening and closing hours for their schools. In
addition to the adverse impacts on achievement, this puts our
public board at a significant competitive disadvantage.
Despite three years of
work, a new funding formula has not yet been developed for
transportation. To bring our funding to the same level as that of
our coterminous English Catholic board on the basis of cost per
student transported would require some $6 million. As an interim
measure until a new formula is in place, to begin to level the
playing field in Ottawa we need $5 million additional funding for
transportation. We ask that a fair funding formula for
transportation be developed as soon as possible.
Rising heating costs: The
significant world-wide rise in fuel costs has predictably had a
major impact on our heating costs. We have already overspent our
budget. We estimate that $2.5 million is required to close this
gap, and we recommend that the government study ways of
protecting the budgets of school boards and other provincial
institutions from the vagaries of energy price fluctuations.
School maintenance and
operations: Despite improvements in funding in this area, we
cannot maintain our buildings to current industry standards. Each
year that we fall short on our spending in this area, the
maintenance expenses for future years increase, thereby
compounding the problem. We estimate that to maintain our schools
in reasonable condition, an increase of $4.6 million in our
maintenance funding is required.
School councils: There is
no specific funding in the formula for school councils, despite
the agreed importance of these groups. We suggest that the
government further emphasize their importance by including $500
per school, an amount of about $75,000.
Before I turn to table 2,
"Capital and One-Time Expenses," I must comment on the burning
issue of extracurricular activities. The OCDSB opposed the
roughly 10% increase in secondary teacher workload that was
introduced last summer. The impact has included serious
reductions in areas such as valued extracurricular activities,
on-call availability and hallway, lunchroom and other supervision
time. Consequences include cost increases elsewhere, such as the
occasional-teacher budget.
1010
We believe this committee
should recommend that the government reopen Bill 74 in order to
reassess teacher workloads. To add 10% to our teaching capacity
at the secondary level would cost about $11.3 million in the
OCDSB, some of which would be offset as other costs, such as
occasional teachers, decline. And there will be a significant
cost offset, of course, once four-year secondary school is fully
implemented.
New school construction:
Capital funding for new school construction is available only
after the board achieves 100% capacity utilization across the
district.
We have made major efforts
to rationalize space and close schools over the last three years
but, due largely to the complexities of our downtown school
infrastructure and our need to retain flexibility to respond to
ministry policy changes and to community needs, we have had
limited success. Already the ministry has mandated class size
reductions that have added to space requirements. Other needs
that could result in policy changes include access to computer
labs and family studies rooms for grades 7 and 8, appropriate
child care facilities for seamless school days and standard gyms
for every school.
Our immediate requirement
is for four elementary schools in the growing suburbs. As we have
regularly discussed with the ministry, the formula should
recognize the geographic diversity of school districts and adopt
a zone model, which in our case would provide approximately $40
million for land acquisition and construction costs for four
elementary schools.
The backlog in school
renewal: School renewal funding covers replacements of things
like heating systems and roofs, and the expansion of facilities.
Like maintenance costs, renewal costs that are deferred tend to
compound, but at a much greater rate. Staff has estimated the
current renewal backlog at $280 million. What is encouraging is
that boards across Ontario are working hard to size up this
problem.
It is important to know
that the backlogs of maintenance and renewal were not created in
the last few years. In fact, they have accumulated over decades
of neglect of our facilities by Ontario governments and school
boards. All too often, when finances get tight, we collectively
tend to compromise spending in this area. This strategy is more
expensive in the long run. It is time to make amends.
Moreover, according to the
Little Red School House, a study of this phenomenon carried out
by Ontario supervisory officers in 1991, the achievement of our
students can be adversely affected by as much as 10% when they
are housed in substandard accommodations. Our staff estimates
that we can bring our facilities up to industry standards within
25 years if we add an additional $24 million per year to our
facility renewal funding.
Enterprise-wide information
system: Ontario boards need modern financial, procurement, asset
management, student information, human resource management,
geographic information, and other computing systems. A major
reason for these comprehensive systems is the increased data
collection and reporting requirements mandated by the province.
The one-time investment required for an enterprise-wide
information system is estimated to be $10 million.
As you can see, the
problems identified do pervade the funding formula. The
Ottawa-Carleton District School Board alone requires additional
ongoing operating funding of approximately $44 million just to
maintain reasonable standards. And we need to build new schools,
we need to begin to deal with the renewal backlog in older
schools and we need to implement modern information systems.
Please take our four
recommendations very seriously, in the interests of student
achievement and the long-term prosperity of the province of
Ontario. As a starting point, an increase of about $1 billion in
funding for elementary and secondary education seems not only
appropriate but in fact essential.
Thank you, Mr Chair. We're
open for questions.
The Chair:
We have three minutes per caucus. I'll start with the official
opposition.
Mr Patten:
Thank you very much. It's not much time. I'm quite familiar with
the extent of the challenges that you've faced. You begin behind
the eight ball because, as you describe, in an attempt for the
province to try to equalize payments all around the board, your
board was faced with $60-million-plus to cut back over a period
of time. Given that, some of the formulas provide grave
challenges. I would say that the flavour, by the way-I know the
challenges of this board, quite intimately so, for my committee
colleagues-is criminal in many ways. The challenges and the
impact on special education and the attempt to shoehorn in, the
lack of provincial standards, the lack of support for a board
that has a history, I would say, of being recognized worldwide
for its contribution to special education-not only in Canada but
visitations from places around the world-is absolutely
astounding. It is now threatened, and that's an absolute
shame.
The dedication of the staff
of the board, the teachers, is just unbelievable. The morale is
extremely poor. It's not the only board suffering from this. I'm
saying this in support of your particular plea. I commend you on
your ability to intellectually rationalize and present something
without emotion, because I know that a great deal of work has
gone into this. The hours and hours of time that this board has
spent-and some of those have gone into the wee hours of the
morning, and I've been there at certain periods of time-is just
unbelievable.
But I will ask you one
thing: you've got about six or seven areas here, all of which are
important. Would you identify, as you see it, one or two
priorities that you think-because I don't think you're going to
be able to get the kind of support you're identifying here-the
board would absolutely need to begin to move forward to maintain
the quality that you see? What would you say those would be?
Mr Libbey:
As I've mentioned, the problems are pervasive throughout the
funding formula. I think they're driven because the ministry
doesn't have enough money to pay the school boards what they need
and so they take a little here, a little there, a little bit
everywhere. That's why they are pervasive and I think they need
to be addressed in that manner. A lot of money needs to be put in
and then the formula thought through piece by piece. Obviously we
need to be able to pay our teachers, and if there's $12.8 million
that we just can't pay under the contracts that we owe, that has
to be fixed. It's very simple.
I think special education
would probably be my second, and English as a second language,
because these are programs that are desperately needed. These
children need a level playing field, they need to be able to
achieve their personal bests, and if they can, that augers well
for the entire school system and for the province, all the
students.
The issue of our school
infrastructure, not being able to build new schools and a huge
backlog of renewal costs desperately needs to be addressed. That
is not a problem that this government or any other individual
government has created, but it is a problem that faces us now.
Certainly one of the good things that is happening as a result of
the focus that the government has brought to these various
individual areas is that we were looking very hard at them and we
are beginning to understand very well the circumstances that
we're in.
Jim, would you like to add
anything to that?
Mr Grieve:
Just very briefly, I would concur with my chair that the issue
facing us at this point, if we're required to really prioritize
some of this list, would fall in the areas of salaries and
benefits, certainly in special ed and most definitely in
supporting our growing and wonderful ESL population.
But I would tack on the
issue of capital. We need to house our students in facilities
that are adequate to the learning needs, and we're simply finding
that we're falling further and further behind. The $280-million
estimate-and this isn't just a ballpark, this is based on a very
rigorous appraisal of every school building we have and is being
replicated right across the province now by almost all
boards-unaddressed, will grow in Ottawa-Carleton to an
$800-million backlog within a very few short years.
The Chair:
Thank you very much. Mr Christopherson.
Mr
Christopherson: Thank you for your presentation.
You know the government
talks a good game about strategic investments, and, again,
they'll do it when we get into the finite details of tax
legislation, but for the life of me I can't think of anything
more strategic in terms of an investment for our economic
well-being in the future, as well as the kids themselves and
their life that's ahead.
At some point, again, the
government should be recognizing the fact that we've got elected
trustees onside, saying something needs to be done with the
funding formula. Senior management staff in virtually every board
that I've ever talked to feel exactly same way. The teachers feel
that way. The support staff feel that way. The parents feel that
way. The kids feel that way. There's nobody left.
The only ones who don't
seem to think we need to make a change are the people who have
the power to do it, and why? They're addicted to tax cuts,
because it works for them politically.
I want to comment that when I listened to you
outlining the challenges facing Ottawa-Carleton, they sounded
very similar to what we have in Hamilton, especially in terms of
English as a second language, the older neighbourhood schools
being closed, the backlog on repairs and not enough staff. If you
take a look at a lot of the older communities across Ontario, our
challenges are similar.
1020
Right now in Hamilton the
flavour of the day, in terms of the ongoing crisis around lack of
education funding, is inner city school closures, usually smaller
schools where we're not up to 100% capacity and you have to close
those to justify getting money for the expanding areas. I wonder
how your board is viewing the damage that is done to
neighbourhoods through the loss of a school that often is the
entire focal point, not just the focal point of education but of
social interaction and, as well, sometimes the only green space
available in a built-up inner city area. Can you give me a sense
of how that is playing out here in Ottawa-Carleton?
Mr Libbey:
Indeed, we've worked very hard, over three years, on the question
of school closures and rationalization. We don't disagree at all
that we have to be very efficient in the utilization of our
space. We have closed some schools; we have put some schools up
for disposal.
Perhaps the telling
response to the question is that the last board, back in October,
I believe, did agree to close six schools. But subject to looking
at some demographic data, which was still in preparation by the
municipality, it was left to the new board after the election to
finalize that decision. Many of you probably are aware that the
new board-it was probably one of the most, let me call it,
interesting municipal and school board elections in a long time.
In fact five new trustees were elected, and the community was
very much saying to us, "You can't go around closing these
downtown schools in order to build them outside the greenbelt. It
doesn't make sense." Moreover, municipal politicians came to us
and said, "Don't do this. It's our community. We need to keep our
community intact," getting at the issue of what it means to take
a school out of a neighbourhood.
Moreover, the business
community rallied behind us and were very insistent. They said,
"We need excellent education if we are to attract people to
Ottawa." They said that to disrupt the downtown schools too much
is to say (a) we don't care too much about education and
(b) we're not going to have the infrastructure available,
when people do come, for the ones who want to live downtown. We
still have a lot of analysis to go on the downtown situation, but
basically we opened five of those six schools and retained them
until we can do a better job of figuring out where we should go
with it. That's the feeling.
Mr John O'Toole
(Durham): Thank you very much for your presentation this
morning. I know the plight of school boards with some insight. I
was a trustee for a couple of terms. You were praising the
Ottawa-Carleton board, which I would as well. I just looked at
the briefing note here. You are doing some partnering and some
inventive, creative things, and I commend you for that.
I represent the area with
the Durham Board of Education, the winner of the Bertelsmann
award, an international award. I guess the argument starts there.
I remember the issues were the same when I was a trustee around
1985-exactly the same issues; nothing has changed. We felt we
were the lowest-funded board in Ontario, yet we were the top,
internationally recognized board. It was recognized-and I hope I
don't sound like I'm lecturing, but there was such a disparity.
In 1994-95, clearly one of the issues was the disparity of
funding in public education, based on assessment wealth, pure and
simple. In fact, in the Royal Commission on Learning report, For
the Love of Learning, the 164 recommendations made it very clear
that in public education each child should be treated equitably.
So the foundation, the formula for what we're trying to do, would
be to have affordable, accessible, quality education.
You did-and I commend
you-in your introduction commend the government. In fact, it
isn't the government. It's the initiation of the government to
implement some of the royal commission findings: the new
curriculum you talked about, the external efforts relentlessly in
each budget, including the last one, to reduce class size.
Jim, I'm going to have to
take your basic premise to task. The numbers I'm looking at are
absolutely, indisputably-your numbers are false. I'm looking at
the macro view; I'm not looking at Ottawa. The Ministry of
Education funding year over year, and I'll give you the numbers:
basically starting in 1994 it was $13.9 billion; in 1999-2000 it
was $14.2 billion; and projected to 2002, $14.7 billion. At the
macro level for the province of Ontario, I'd like you to concede
that we are spending more money equitably across the
province.
This creates a problem. It
clearly creates a problem. In fact, in Toronto just a week or so
ago they had a settlement for 8%, and the province really funded
additional funding for wage settlement at around 2%. They settled
I think for 8%, though I'm not sure it's been ratified yet. That
money traditionally is going to come from the buildings that are
in disrepair, it's going to come from maintenance, it's going to
come from school textbooks; it's going to come from
everything.
Your top three requests,
your top three wish list items were as follows: salary and
benefits, $12.8 million.
The Chair:
I have to ask you to put your questions, Mr O'Toole, please.
Mr
O'Toole: I'll have a question here.
The next one was staffing
for special education, $4.7 million; occasional teachers, which
means time off, $4 million. Until we recognize that the student
is the focus of the whole system, not other stakeholder groups,
we've got the wrong message.
My question here is, do you
now provide extracurricular activities? Have you settled your
contract, and for how much?
Mr Libbey: We provide some
extracurricular activities in the secondary level. They have been
provided primarily by volunteers because we have put in place a
volunteer policy that enables us to do that reasonably well. I'll
ask director Grieve in a moment what per cent we're at across the
board, if we can remember that per cent. We're reasonably proud
of it, but we're still well short of what we want to be at. Not
only that, but the approach we have in place right now is
relatively unsustainable, in our view. We have settled with the
secondary teachers. Jim, I'll ask you for that.
Mr Grieve:
We're in negotiations.
Mr Libbey:
We're in negotiations with the elementary teachers. But the
settlement with the secondary was four point something.
The Chair:
With that, I must bring the discussion to an end as we've run out
of time. On behalf of the committee, thank you very much for your
presentation this morning.
CANADIAN TAXPAYERS FEDERATION
The Chair:
Our next presentation this morning is from the Canadian Taxpayers
Federation. I would ask the presenters to come forward and state
your names for the record, please. On behalf of the committee,
welcome.
Mr Walter
Robinson: Thank you, Chairman Beaubien. My name is
Walter Robinson and I appear before you today in my capacity as
federal director of the Canadian Taxpayers Federation. Seated
beside me is Mr Bruce Winchester, our director of research.
Ma présentation ce
matin sera en anglais seulement, mais à la fin, si vous avez
des questions en français ou en anglais, je vais essayer de
vous répondre dans la langue de votre choix.
By way of background, the
Canadian Taxpayers Federation was founded in 1990 and has grown
in 11 short years to become Canada's largest and most effective
taxpayer advocacy organization. We are non-partisan and
not-for-profit. We do not receive any federal or provincial
political contributions, nor do we receive financial assistance
from any level of government. During employment with the CTF, all
directors and staff are forbidden to hold memberships in any and
all political parties.
Our mandate is threefold:
we act as a watchdog on government spending; we encourage our
supporters to exercise their own democratic rights and
responsibilities, thereby taking ownership of public policy; and
we advocate fiscal and democratic reforms through presentations
to legislative committees such as yours this morning.
The focus of our pre-budget
submission, copies of which are in front of you, I believe, is to
drive home the message that an unwavering fiscal focus can and
will ensure a formative future for Ontario.
We wish to congratulate the
government for acting on two of our recommendations from last
year: eliminating provincial bracket creep and moving to a
tax-on-income system. To be fair, we also acknowledge the small
steps the government has taken with respect to reducing our
provincial debt.
1030
While last year's fiscal
indicators, as outlined on page 5 of our pre-budget submission,
signal robust economic performance, extreme caution and prudence
must underlie the articulation of Ontario's fiscal plan in budget
2001; or in simpler terms, that was then and this is now. Today,
the clouds of economic uncertainty cast a long shadow over our
province. The US Federal Reserve Board has dropped its
trend-setting interest rate by 100 basis points in four weeks. In
addition, board chairman Alan Greenspan has signaled that further
interest rate cuts may be necessary to mitigate against what he
calls downside risk.
Major multinationals such
as Whirlpool Corp and auto giant DaimlerChrysler have announced
significant workforce reductions in the last month, and just last
week, as you know, Canadian-based optical networking behemoth
Nortel signaled its intention to up its global layoff tally from
6,000 to 10,000 workers.
To complicate matters,
unlike Ottawa, the Ontario government does not have the option of
specific monetary policy changes to mitigate against recessionary
pressures, and it is monetary policy which is the most effective
tool in a recessionary environment.
Inflationary pressures are
also present. Ontario's inflation rate as measured by the CPI was
2.9% for last year, and recent surges in oil and commodity prices
signal that this trend will continue for most of 2001. Talk about
sobering news for a Monday morning.
Economists are split as to
their interpretation of the gravity of all these signals. Some
fear a deep and prolonged, at least nine months or more, US-led
global recession. Others are more upbeat, choosing instead to
label the present economic environment as nothing more than a
surplus-inventory six-month correction cycle.
One thing is for sure: such
uncertainty necessitates fiscal prudence. Unfortunately the
government of Ontario has not exhibited this prudence. Indeed,
since 1995, the Harris government has steadily abandoned many of
its fiscal principles that were first articulated in the Common
Sense Revolution. From privatization to expenditure control to
redefining the role of government, the party of the revolution,
we believe, has become the party of the institution.
Let me be very clear in
this. At mid-term, through its second mandate, we believe the PC
government is bereft of fiscal vision. However, implementation of
our recommendations would provide a foundation for the government
to once again articulate a compelling and sustainable fiscal
vision.
To start, the government
must get serious about reducing Ontario's $112-billion debt. We
can cut tomorrow's taxes by reducing debt today. Indeed the
provincial debt, which all parties-the Liberals, the NDP and the
PCs-had a hand in creating, represents a burden of
intergenerational tax evasion that we should not and cannot pass
on to future generations of taxpayers.
Each taxpayer in Ontario today is responsible for
$21,000 worth of debt. Worse still, debt interest costs alone
today are $1 billion higher than they were when the current
government assumed office in 1995. At $9.4 billion a year, debt
interest payments chew up 14.7 cents of every tax dollar that you
and I send to Queen's Park. That's over $25 million a day, over
$1 million per hour, $18,000 a minute and a whopping $299.02 for
each and every second.
For budget 2001, we
recommend a legislated schedule of annual debt reduction payments
of 4% of gross provincial revenues. If revenue growth were to
continue at 3% per annum, applying 4% of revenues would result in
Ontario becoming debt-free by the year 2028. This analysis is
found on page 10 of our submission.
Ontario is competing for
jobs and investment with the Great Lakes states and provinces
such as Alberta. When it comes to debt reduction, we should
remember that our American friends are projected to be debt-free
between 2012 and 2015, depending on the magnitude of the tax cut
President Bush can push through Congress. Meanwhile, Alberta is
projected to be debt-free next year, or by 2003 at the latest.
Reducing debt is not only the right thing to do for future
generations, there are also more pressing and immediate
competitive and political dynamics that make this priority number
one for this year's budget.
Hot on the heels of debt
reduction, spending controls rank a close second for policy
inclusion in the budget later this May. Nowhere is this more
evident than in the unsustainable trend of Ontario's skyrocketing
health care expenditures. To be fair, we acknowledge the
tremendous pressures that CHST cuts at the federal level have
exacerbated and that mammoth public expectations are political
facts of life when it comes to health care funding. In fact, 62%
of all new or increased spending in Canada's 10 provinces over
the past three years has gone to one file and one file alone:
health care.
Simply throwing more money
at the problem is not the answer. In this respect you're no
different than the federal Liberals or the BC NDP in your
irresponsible and reckless spending approach to health care.
Ontario's health care budget has increased at an average rate of
5.92% over the past three years. If this trend continues and we
were to use the same revenue growth rate of 3% a year as we did
in our earlier example for debt reduction, then by the year 2038
Ontario will require only two ministries: finance to collect the
money and health to spend it, period. Full stop. This is
illustrated on page 12 of our submission and it bears
repeating.
Health care is poised to
consume the entire provincial budget in 37 years. By 2015 alone,
health-related spending will consume 50% of the provincial
budget. Provincial politicians will be forced to make either/or
choices. They, or should I say you, will be forced to choose
between health care and education, between hospital beds or
textbooks. You will then long for the good old days of the late
1990s and early 21st century with their simple trade-off debate
between tax cuts and spending.
While health care is the
most troubling example, the message is relevant for all
provincial portfolios, and in this regard the government is to be
chastised for misleading Ontarians in successive budget
documents. For example, on page 47 of Budget 2000, the government
maintains its "commitment to controlling spending is demonstrated
by significant reductions in program spending as a per cent of
Ontario's gross domestic product." There's a nice little graph
here and the line continues to go down and everything is supposed
to be rosy. This is utter and absolute nonsense.
If the provincial GDP were
to grow by 10% a year and program spending climbed a whopping 9%,
spending when measured as a percentage of GDP year over year
would still decrease. The graph would go down. But no sane
individual would claim that a 9% spending increase in a
low-inflation environment is the mark of a fiscally prudent
government. This measure also negates the amount of revenues that
the government will or will not collect.
On the health care front
Ontario needs a plan, any sort of plan, and quickly. Demographic
shifts, technology and pharmaceutical costs will skyrocket and
patient utilization pressures will further exacerbate demands for
continuing increases to the health budget envelope. Outcomes
analysis, restructuring health care governance, primary care
reform and other initiatives are necessary and long overdue.
Ontario should also push for modernization with its provincial
partners of the Canada Health Act to include the principles of
choice, sustainability, quality and accountability as principles
for the Canada Health Act. They don't exist there now.
As for overall spending, we
recommend that the government seek first to meet the needs of
increased priority program expenditures through reallocation
within existing budget envelopes. Further to this principle, we
believe that total annual program expenditure growth should not
exceed the upper-limit benchmark, a percentage of annual
inflation plus population growth.
Turning to tax reform,
allow me to reiterate the CTF's support for Ontario's move to a
tax-on-income system. However, this move has been somewhat
confusing for Ontario taxpayers wishing to keep track of the
government's tax cut promises, especially the pledge to reduce
income taxes by a further 20% on top of the 30% which occurred in
the first mandate. In light of recent substantive federal tax
cuts, taxpayers can be forgiven for wondering if they would be
better off under the old provincial tax payable on federal tax
system. Our summary calculations, found on page 14 of our
submission, indicate that this is indeed the case. Federal tax
cuts have been clawed back by higher than necessary provincial
rates, and it will be the case for the 2001 taxation year unless
new and lower rates are announced.
Along with lowering these
rates to the appropriate levels, the government should indicate
through various income-earner profile examples in its budget that
Ontarians are equal to or better off in the made-for-Ontario tax
environment as opposed to the old tax-on-tax system.
1040
We once again call for the
appointment of a minister of privatization with
cross-departmental responsibility to take a look at how you can
continually evolve and devolve government services. However,
since this is unlikely, we also recommend that an all-party
legislative committee be established once during each session to
review all relevant government operations and highlight
candidates for divestiture and/or alternative service delivery.
Finally, we recommend that the Ontario government cut provincial
gas taxes to a level commensurate with roadway and public
transportation spending, which has reached a 50-year low, even
when SuperBuild initiatives are included.
Budget 2001 poses
significant challenges for fiscal management in Ontario. Minister
Flaherty must temper public expectations for devotion of
anticipated surpluses of over-taxation into areas of program
spending with a more long-term view to tackling the systemic
problems of an intolerable provincial debt burden and runaway
program expenditures. Whether it is raising a child, building a
business or managing your own portfolio, in all these endeavours
of life taking a long-term view is without question always the
wisest and most successful strategy. It should be no different
for the government of Ontario and its choices for this year's
budget. Adoption of our recommendations for a fiscal focus can
and will ensure a formative future for all Ontarians.
Merci pour votre attention
ce matin. J'attends avec impatience vos questions.
The Vice-Chair (Mr
Doug Galt): Thank you very much for a very detailed
presentation to the task force. We have about four minutes per
caucus. We'll start with Mr Christopherson.
Mr
Christopherson: Welcome, Walter; good to see you again.
To start on a positive note-I've got two, actually, so things are
getting better as the years click by.
Mr
Robinson: Save them for next year, Mr
Christopherson.
Mr
Christopherson: Let's stay optimistic and hopefully we
can work toward three next year.
First of all, I love your
tone. It's great, exactly the sort of approach that should be
taken with this government, whether you're attacking it from the
right or the left. The issue of the bracket creep: you and I
spent a fair bit of time last year talking about that during your
presentation. We agreed that it was a good thing. The government
did it. I said it was a good thing. I think it's good for the
people of Ontario when, sort of, right meets left and you agree
fiscally on a direction that should be taken. It's a good litmus
test, in my opinion.
Now, having said that, two
issues: on page 5, you say-and you spend a lot of time on health
care, you make your projections and your arguments-"On the health
care front, Ontario needs a plan, any sort of plan, and quickly."
I just wanted to point out to you that one could say that you
could spend an even longer period of time making the argument
about all the problems that exist in the health care system, but
then to me it looks like almost a throwaway to say, "Ontario
needs a plan." At the end of the day, that sort of is everything.
The arguments really don't matter much then when you've
determined you have to do something, again regardless of your
philosophical approach. So to just say "needs a plan" is not
really as helpful as I know-and I mean this sincerely-that you
want to be in terms of the comments that you make. I don't have a
lot of time, so I'll just link up my questions and you can deal
with whichever you prefer. So I'm wondering what direction: do
you have some thoughts? If it is privatization, let's hear that
and let's have that debate.
The other one is on cutting
the gas tax. I don't think anyone would argue that in an ideal
world we'd like to have the amount of money spent on roads,
bridges, transportation to be commensurate with what we collect.
However, given the way that the consolidated revenue fund works
in the province of Ontario, which is not different from any other
government, if you take that much money-and I suspect we're
talking hundreds of millions, if not billions, of dollars-out of
the revenue equation, then either we borrow the money, cut
services or raise taxes somewhere else in order to offset that. I
wondered how you saw that being dealt with. So those two areas,
Walter.
Mr
Robinson: Thank you for the questions. I'm glad we do
find points of agreement across the political spectrum. It's more
like a circle as opposed to a spectrum sometimes.
With respect to the very
valid point in terms of "Ontario needs a plan," at the moment the
Canadian Taxpayers Federation is preparing a national discussion
paper for release this May or June. It'll be the most ambitious
thing we've ever done on health care, over 100 pages. We have
freedom-of-information requests into every province and
territorial government, plus the federal government, for waiting
list estimates, for issues such as how many patients we're
sending south of the border for health care, what our workers'
compensation boards are doing, and also discussing the
philosophical issues around health care.
I would caution you, if I
may, with respect, Mr Christopherson, that just to say, "Is the
plan privatization?"-no, that is a sterile debate in health care,
that it's either our system or it's the evil American system,
negating the fact that there are some 85 industrialized countries
on the face of the planet, many of them
social-democratic-governed countries, which employ a blend of
public and private medicine for the best and most effective
delivery of health care to their respective citizens.
We haven't put it in here;
I think it's a separate submission we'll make to the respective
standing committees on health around the country in May and June,
plus a national editorial board tour, to say, "Let's bring best
practices from around the world." Perhaps it's Chinese or
Singapore medical savings accounts for primary care, or perhaps
it continues to be a single-payer model for tertiary care being
the most effective. I would look to the United States and say we
should emulate what they do in research and development. For heaven's sake,
the University of Texas M.D. Anderson Cancer Care Center in
Houston, Texas, spends more on research and development for
cancer care than the entire nation of Canada, period. So perhaps
we should emulate some of the things the Americans do in terms of
wellness promotion and a variety of other things. Mr Patten and I
have spoken at length on some of those issues. That's where we
are on health care.
With respect to the tax
cuts question on gas taxes, again it's part of an overall
national campaign to point out that the amount of money we're
collecting at the pumps is not being put back into roads and
public infrastructure, including public transportation, whether
it be congestion pressures in the GTA, light rail initiatives
here in Ottawa or other communities around the province. It's an
alarm bell to tell the provincial government, "Wait a minute,
here. You just cannot continue to collect these high fuel tax
costs and not have some premise of redirecting them back." As
much as we're not advocating for dedicated taxation, we are
advocating for the historical principle of gas taxes.
The
Vice-Chair: We'll have to move on to the government
side.
Mr Ted Arnott
(Waterloo-Wellington): Thank you, Mr Robinson, for your
presentation. I think your criticism of the government is
intended to be constructive. Your observations have been noted by
the government members. I'm certain that the Minister of Finance
will be interested in what you've had to say.
I want to thank you for
your support of the notion of the need for debt reduction as a
higher priority within the government. I think you're absolutely
right on that. For the last three and a half years I've been
advocating within our caucus that the government should adopt a
debt retirement plan over the long term, suggesting that we
should try to look to the future with a vision of a debt-free
Ontario. Alberta of course is in the very enviable position of
being almost debt-free. As you pointed out, the United States has
a projection that, if certain current trends continue, they may
be debt-free by the year 2012. Looking at our economic policies
as a Conservative government, we have to look at debt retirement
with a view toward making that a higher priority.
In terms of health care
spending, I think it's fair to point out that our government was
committed to increasing the health budget to $22 billion, which
we've achieved earlier in our mandate than we had planned, I
suppose, but we are responding to the needs, we believe, of the
population and the expectation for improved health care. I think
it's fair to say that we're not wasting a lot of money in health
care right now. But I would say to you that your suggestions and
your recommendations in terms of improving patient care while
saving money within the system would be very helpful. We would
look forward to receiving that advice from your organization.
Mr
Robinson: Again, I understand the political imperative
of increasing health care funding, but as we've pointed out many
times, more funding does not equal better outcomes. More funding
is more funding. We tried for 30 years federally to fund job
creation through deficits and all we got were more deficits and a
national debt. There are other areas. That's why we point out,
and we'll point out again in our submission, outcomes
measurement. More funding does not necessarily increase life
expectancy. More funding, if it just goes to freeing up bed
space, may not go to needed cancer research or needed research
into the diseases of aging. It's a question of targeting and
looking at outcomes and on where you get the best bang for your
buck. That's our message to the provincial government.
I think Mr Winchester may
have something to add on that. No. OK.
The
Vice-Chair: Just 30 seconds.
Mrs
Molinari: Thank you for your presentation. My comments
are more in the line of, as a government we feel that we need to
have a balance. Certainly debt reduction is one of our
priorities, and tax cuts and creating jobs will add more dollars
to the coffers. We also need to invest in social services that we
presently have-education and health and all of those. So trying
to keep that balance is the critical point and not to focus
primarily in one area, debt reduction. As important as it is, we
also need to keep in mind that there needs to be a balance.
1050
If I do have time and you
have time to respond, I wanted to hear more about the comment you
made about there's too much focus, almost myopic, on public
dollars committed and too little focus, or non-existent, on
result obtained for public expenditures and value-for-dollar
questions. So if there is an opportunity, if you would respond
and be a little more specific on what you mean by that comment, I
would appreciate it.
The
Vice-Chair: An ultra-short response, by all means.
Mr
Robinson: Just a point of clarification: we still have
one question coming from the Liberal side. That's why we're
moving here.
In terms of the focus, more
value-for-money audits, a greater adherence to the
recommendations of the auditor of Ontario. Mr Peters does good
work, and we believe that there's very much a federal malaise
that has beset Queen's Park as well, that the Provincial
Auditor's report is something to be tolerated-take two Tylenol,
read tomorrow's headlines and let's move on-as opposed to
responding constructively to what an independent officer of the
Legislature says should be done to improve government
performance.
The
Vice-Chair: Thank you very much. We move on to the
Liberals.
Mr Monte Kwinter
(York Centre): Thank you very much for your
presentation. I agree with very much of what you say, but I have
a basic problem. The basic problem is that when I was in
government the most common comment I got from people like
yourselves and the business community was, "If you had only run
that place like a business everybody would be better off."
The problem: You can't run
the government like a business, because you can't make some of
the changes that a
business is forced to make. Take a look at Nortel. Nortel has
gone to the point where they've seen their share price go from
over $100 to $30; they're announcing they're going to lay off
10,000 people. If you had that situation happen in government you
would have disaster, you would have a severe problem, so you have
to make choices.
This government made a
choice to have a tax cut when they were still in a deficit, so
that tax cut was paid for by increasing the debt of the province.
In 1990 Mike Harris went to Windsor and stated, as you have
stated in your brief, that we don't have a revenue problem; we
have an expenditure problem-and he was against casinos. The next
day he changed his mind because he suddenly came to terms with
the political reality. Now we have a situation that if that
revenue was not there from casinos and gambling, they would have
a much more serious problem than they have now.
These are some of the
concerns that I have. I absolutely agree that you've got to
reduce the debt as quickly as possible. I don't know when you got
here this morning, but I'll tell you, we've been having these
hearings for a week now and we have delegation after delegation
coming to us and saying, "You've got to spend more on education.
You've got to spend more on child care. You've got to spend more
on infrastructure. You've got to spend more on every single
area." There is a demand by people to say, "We're sorely
underfunded, the long-term progress of this province is being
undermined, and you've got to increase it." You have these
conflicting interests: the fiscal reality that we've got to get
rid of the debt and the political reality that the citizens of
this province expect sort of minimal service that even now is not
being provided. Do you have any reaction to that?
Mr
Robinson: Thank you for the question, which gets us back
to the entire theme of our presentation: fiscal focus for
formative future. You cannot redistribute the wealth if you don't
create it in the first place. It is not a chicken-or-egg
question.
The pillars of a
respectable civil society in terms of taking care of the needy,
having funded meritorious public goods and services, are built on
a foundation of wealth creation. We think the quickest route to
wealth creation is ensuring that our fiscal house is in order,
and once we reduce the debt we free up 14.7 cents out of every
tax dollar. You free up $9 billion for needed social service
investments. That gets back to us on debt reduction.
The organization does not
have a political position on the casino question, other than that
gambling is a tax on people who are bad at math. I'm guilty as
charged. I buy the odd 6/49 ticket, but I can afford it.
Unfortunately, it preys on the poorest and most vulnerable in our
society. They just get into a cycle, whether it be welfare
dependency or continuous low incomes. Unfortunately, that's the
reality of gambling. We have a fear that the government is
actually too reliant on gambling and lottery and alcohol sales
revenues. They are very cyclical with an economy as well and not
the sustainable basis of long-term funding for needed social
services and public goods.
The
Vice-Chair: Our time has run out. We appreciate your
presentation. On behalf of the committee, thank you very much for
coming forward.
Mr
Robinson: Thank you, Mr Chair. Our hearts are with Mr
Patten.
CANADA'S RESEARCH-BASED PHARMACEUTICAL
COMPANIES
The
Vice-Chair: Our next delegation is Canada's
Research-Based Pharmaceutical Companies, Mr Murray Elston,
president; Ms Zenek Dybka, director of Ontario region. Maybe you
can restate your names for the record. On behalf of the
committee, welcome. We look forward to your presentation.
Mr Murray
Elston: Thanks very much, Mr Chairman. I'm Murray
Elston. I'm the president of Canada's Research-Based
Pharmaceutical Companies. Zenek Dybka is the director of the
Ontario region. It's good just to get back into the forum. I see
that people haven't lost their inclinations to deliver the usual
materials here. It's good to sort of feel like I'm back home, in
a way. I think it might be fair to say that I wasn't always a
welcome participant in these committees from a previous life, but
I'm happy to be here this morning with you. It's good to see so
many faces that I recognize. I can count on some interesting
questions, I think.
Let me do a couple of
things. Let me just bring your attention to the piece which is in
front of you. It probably would be better if I read it, but I
won't. What I will do is try to highlight it so there'll be some
time left for some questions, which I think is probably a more
useful way of proceeding.
First of all, our
association represents 58 companies. Our backgrounder, which is
appendix A, sets out that there are some 21,000 Canadians who are
directly employed by our companies. It includes the large
companies which you might recognize: GlaxoSmithKline, Purdue
Pharma, Pharmacia, Merck, Pfizer. It also represents the new
evolving biopharmaceutical companies, many of whom you will not
have heard of, but about whom you will hear a lot more in the
future: we have Lorus, we have QLT from BC, Biomira from Alberta,
Theratechnologies out of Quebec, and a whole host of others who
represent for us the way of the future. In a sense, it really
brings me to the nub of our presentation, which is basically that
the pharmaceutical industry represents for Ontario a very major
prospect of the way forward.
During the last federal
election, we had five official parties that were organized around
the debates about where we go from here. All of them were moving
forward in one way or another with the knowledge-based economy.
There were differences in degree, obviously, but there wasn't
anyone who was taking us away from that very exceptional and
well-needed strategy.
Having said that, we are
now in a position where pharmaceuticals would like to be included
in that knowledge-based economy. I think most people, when they
talk about it, are talking about the information tech people:
the software people
and some others. But pharmaceuticals represent in the same way
that type of opportunity. We are creating products out of
knowledge, generated out of research and development. We would
have to say to you that we represent for the government of
Ontario a way of fulfilling two of their very largest objectives,
one being the creation of jobs and generating a sustaining
economy-about which we heard a little bit from the previous
presenter-and also representing a significant introduction of
innovation to the health care field. While we don't say that you
can get something for nothing, let me say that from a substantial
point of view, the research does develop, with a bit of an
investment, a lot of advance with respect to being more efficient
on the ground in providing better health care for all.
1100
Now, it's interesting for
us that we are involved in a working group with the Ontario
government, and that working group is basically setting a
strategy for pharmaceutical development in Ontario. We've been
invited by the Honourable Jim Wilson to put that strategy
forward. We've discovered in that working group that Ontario
could be one of the top five jurisdictions for investments in
pharmaceutical research and development in the world, but not
without some changes. I guess I would have to say that from my
point of view if we could leverage some of our strengths, then we
could make a major step forward. We would urge you to consider
these points: (1) leverage Ontario's strengths in areas which I
will cover later; and (2) level the regulatory playing field and
then create a forum for continued dialogue to strengthen the
partnership between the research community, government and the
private sector.
For all of this, I think
the strategy we'll develop over the next several weeks will
permit us to achieve two of the government's priorities
simultaneously.
If we look to see some of
the initiatives of the government which set the base for us,
there's a continued support for health care and reform, and I
would be interested in getting into a debate on that, but perhaps
we'd have to have another forum. Former health ministers tend to
have lots of opinions that tend to take a long time to express.
In a rather closed forum like this it wouldn't be possible.
We have a commitment to
reducing the provincial deficit and debt, and then we have the
leadership of Jim Wilson as Minister of Energy, Science and
Technology who's asked us to develop the strategy. There have
been a series of steps taken by the government which have created
the background or the backdrop for continued investment in
research and development.
I must just add one word
here, and that is that while all of the items are listed there,
the danger for us, economically and from a research point of
view, is that the announcement of these programs are well made,
they're well publicized, but the issue is not just making the
announcement and having one or two or three years. When you're in
the business of research and development, you have to have the
commitment to sustain these in terms of decades as opposed to in
terms of two or three or five years. You have to be prepared to
move on to multi-year allocations. I know that we usually talk in
terms of five years, but five years is not that long in research
and development terms. In fact, you're hearing from me this
morning the same pitch that we make to the federal government,
which has also put in a tremendous amount of research funding
over the last two or three years. It's easy to make the first
commitment; it's more difficult when you have to sustain it. In
fact, if you look at our history recently, our companies now are
putting up about 42% of the biomedical research in Canada. That
compares to about twice as much as the government of Canada with
the provincial authorities in this country.
I don't say that with any
degree of pleasure but merely to point out that when everybody is
cutting back on the provision of services and other things,
research generally takes the first hit and it takes a significant
hit. It takes it permanently because, unlike other areas where,
like a switch on an electrical light, you can turn it on and turn
it off and get the same brilliance, once you turn off research
and development activities, you lose perhaps a whole generation
of researchers and developers. You lose the types of dynamics
which are generated by women and men who have exceptional
credentials internationally. If I can urge anything, if I can get
you to take anything back in terms of our presentation today, it
will be to hold the line when times get tougher. We know that in
our world of political funding things get tough from time to
time.
I remember one person who
was with me at the Ministry of Health. He was actually in the
bureaucracy and quite by chance one evening when we were speaking
about some other things, he opined to me that one of the biggest
problems that occurred in the department of health was that in
the 1970s they took out their research sector. That was not the
basic scientific research group that I am speaking about here,
but the people who understood how to get to the next trends, the
people who understood how to think in advance. When you're in
departments like health and everything is running around you so
quickly and so densely, it is very helpful indeed to have those
think-forward pieces, those things that make you consider what
the prospects are if you take step (a) over step (b). So if I
urge you to do one thing, it's to protect the research and
development integrity of the province.
Having said that, let's
build on what we have here. We've got very good credentials in
basic research, but let's expand those. We've got very good
credentials with respect to clinical trials, but let's expand
those. And let's put a regulatory system in place which promotes
those being done in Ontario.
We've done a number of
things, as I said earlier, and you will see them listed, but the
global changes in all areas are having a tremendous effect on
whether or not we can attract investment here. Having said that,
the pharmaceutical sector is even more affected by those global
changes. Take a look at how there is concentration coming with
research and development, and you will see that there is a tremendous fight among the
people in Europe and the people in the United States to build the
critical mass to attract the women and men who do research and
development. In fact, Canada becomes a side player; we end up
having less than 2% of the worldwide private sector investment in
pharmaceuticals. Some C$56 billion is invested annually and we
are getting just around $1 billion of that. We should be at
roughly 10% of the US level, if we do the 30 million to 300
million people extrapolation, but of course we are at about a
quarter of that. Instead of having about $4 billion of annual
research, we have about $1 billion. But we think we can do better
and we think that Ontario, having taken some steps forward, is
not yet at a position where it can critically expand and develop
those resources in a way which will be permanent. I guess I would
be exaggerating a little bit if I said that you can ever expect
it to be permanent. You have to be continually working at these
or you can lose the advantage.
I would raise just one
country as an example of competition and how they met the
competition from outside and actually are raising the bar even
higher, and that's Ireland. I think many of you will probably
have read the case studies there. They did well in manufacturing
and now they're going after knowledge-based economies as well.
They are very aggressive and they are a very good example of how
you have to really make choices and then proceed to stay the
course and work hard.
I think I'll move just
really quickly toward the end of the presentation and deal a
little bit with health care. The first message: you've got to do
well in research and development, and Ontario can really leverage
itself in research and development to increase its economic
factors.
You can see on pages 14 and
15 of my presentation-and I hope they're the same ones on yours-a
list of three areas in which Ontario should take some actions
leveraging the strengths, and I've laid them out there, levelling
the regulatory playing field both at the provincial and federal
levels. I'll let you read those and you can actually take some
time to ask me some questions.
It's important to know that
the products we discover are helping our health system respond
better, in my view, than it was designed to respond some 35 or 40
years ago. We are dealing with more diseases; we are finding
cures for more problems that ended the lives of Canadians; we are
promoting the ability to move toward even new innovative
therapies which will extend life. You will see later in this
presentation a couple of studies which show if you invest a
dollar at one point when a man is 60, you will get another year
of extended life for him, or if it's a dollar for a woman at age
60, you will get 2.3 years of extended life if you do it at the
right time. There are all kinds of examples of how our medicines
are beneficial.
What we need is the
recognition that we have to have, in the context of a research
and development economy, the ability to make the products which
are discovered available to the women and men who need them in
our society. Products discovered here are of no use, if they are
going to be curing diseases, if they're going to be helping
people with Alzheimer's or with MS or with cancer, if they are
precluded from use by the women and men who need them by some
restrictive practices of listing.
1110
I will leave it to you to
understand, I guess, that if we are going to have a very active
research and development community, it will only be beneficial to
have that if we are actually going to make use of the
products-and we have a huge number of products which we've found
in this country, by the way. Many of you will probably not know
that the list is as extensive as it is. Everybody knows about
insulin. Probably some of you will know about Singulair, which
was discovered in labs in Montreal but was not approved for use
in Canada until 28 other countries approved it for use. We've got
a whole series of other examples: Premarin, which is used in
women's health and which is run by Wyeth-Ayerst, which happens to
be the company of our chairman, Aldo Baumgartner. All of these
advantages are available for our economy and they are available
for our health care system if we have practices which are
effective and efficient in making these products, one,
discoverable here, and two, listable here and fundable here for
formularies and then ultimately available for use by the women
and men who are suffering from diseases.
I have a list of four
different areas which I think can assist the government of
Ontario. I think we offer the advantage of being one of those, if
I can put it in quotes, "clean" industries, part of the
knowledge-based economy which is so important, I think,
critically overall. Third, we offer sustaining help in our health
care world in a way which probably none of us, and me in
particular-I will speak for myself-could ever have expected some
15 or 17 years ago when we were wrestling with the problems that
we confronted there.
Those are my remarks, Mr
Chairman. I'd be pleased to answer questions if there are
any.
The Chair:
Thank you very much. We have four minutes per caucus, and I'll
start with Mr Galt.
Mr Doug Galt
(Northumberland): Thank you for your thoughtful
presentation and interesting information.
I want to explore the costs
in the Ontario drug formulary. You'll be familiar with the
spiralling costs, that in roughly 1985 we started out at
something like $400 million. By 1995, it was $1.2 billion, and
it's still climbing at double-digit figures, very quickly. It's
not uncommon to hear of somebody getting a prescription for over
$400, an injection for $500 once a month, and so on. Just a few
years ago we thought a prescription of $30 or $40 was pretty big,
but this is spiralling.
We see what's going on with
the federal government. They started out with a so-called 50%
they were going to match; we got down to an all-time low of 7% in
Ontario. We're back up in the neighbourhood of 11% or so. I look
at a socialist province like Saskatchewan, where you have to pay
almost the first $1,000 in drug costs before the province kicks
in, and here we have people complaining if they have to pay the $2 or the
prescription fee of $6.11 on a $400 prescription.
I'm coming around to the
question of, where do we go? We heard the previous presenter tell
us we're almost to the point of two ministers: the Minister of
Finance and the Minister of Health. We're now up to 44% of the
programmable costs in Ontario being health care. It's climbed
from 38% since we took office. His suggestion of two ministers is
not that far out; we're headed in that direction. It's a little
extreme right now but it brings a point.
I'm coming around to, what
do we do as a province? You're selling pharmaceuticals and
promoting them, and I can understand that. Every once in a while
I hear somebody say, "Well, if you take this particular
prescription, it will save people from going to the hospital and
we'll save umpteen dollars," but what are we going to do to get
this mammoth thing under control as it relates to pharmaceutical
costs?
Mr Elston:
There are a couple of remarks I'd like to make. First of all I
think the issue is, what do you do if you don't provide access
for people to these medications? Our need is to respond to
disease problems. There is more information in my little written
piece here, but it costs upwards of $750 million to find one
successful molecule, and there has to be an ability to recoup
that, so it's a very expensive process. Having said that, if you
do not respond, the expenses are huge in terms of personal
suffering, which we cannot quantify and, second, in time in beds,
which we can quantify. I have to confess I haven't been reading
my material as closely as I should perhaps, but in the old days
it wasn't uncommon for a bed to cost us $1,000 a day. When people
no longer have to be there consuming a $1,000-a-bed resource,
then you can see the benefits of being in a position to be at
home and dealing with the disease in that sense.
My view is and continues to
be that our health care system is functioning as well as it is
only because of the introduction of innovation. I put in that
category not only the therapies which our companies produce in
pharmaceuticals but also in terms of the innovative medical
technologies which are also available-MRIs, CT scanners,
lithotripters. All of those things are there. From my point of
view, if we had not introduced any of those therapies we would be
now bankrupt in our health care system. But in fact, the
innovation, for which we're paying and we're paying good money,
is permitting us to provide care to huge numbers of people in
advance of those that we would have been producing care for
before. We don't have huge wards. We still have to deal with the
issue of how many hospital beds are right, but we're doing so
many more things outside the hospital sector. We are, I think,
positively ahead. I can give you a whole series of things; in
fact, perhaps I should send my whole Value of Medicines
brochure.
I cannot contend to you
that it will get cheaper, but I can tell you that we are better,
and we're better as a population. We're intervening more quickly.
We don't do operations, generally speaking, for ulcers; we used
to. We have gone from having a single bypass operation as a huge
event, to people having quads and even more-doing quadruple
bypasses and doing valves and the whole thing. Those are done
because we can do exceptional things with medication. I contend
to you that it's still an issue, but I can't find a way of
suggesting to you that you should make them unavailable so that
it becomes cheaper.
In my discussions in my old
days with Dr Dennis Psutka, a wonderful ADM at health in those
days, we used to talk about this and where is it heading, because
every time we were able to introduce new technology in the trauma
centres, for instance, then we were into a position of having to
deal with the rehabbing, to deal with the reintroduction of
people into the communities and other things. At one stage, and I
don't mean to have this sound cruel, but the cheapest system, if
that's what people are looking for, is not to call the ambulance.
That's just totally unacceptable, and not to intervene is
unacceptable.
The Chair:
Thank you very much, but we've run out of time and I have to go
to Mr Kwinter.
Mr Elston:
Just like the old days. I'm sorry, I ran the clock.
Mr
Kwinter: As always, it's a pleasure to see you, Murray.
I have a parochial question for you, first off, which is nothing
to do with what's going on here. But I saw your publication,
called The Parliamentary Guide, and you list the R&D member
companies located in the 30 federal ridings across Canada and in
Ontario. I have the head office of Aventis in York Centre. I
don't see them listed in here.
Mr Elston:
These are just our members. It's probably Aventis Pasteur, which
is vaccines and a very well-known and very accomplished company.
They are not a member of ours. Their senior, Aventis
Pharmaceuticals, is a member of ours. It's a great company.
Through you, asking them to join up, we'd be happy to have them,
too.
Mr
Kwinter: We heard from the previous presenter the fact
that if health care costs are not curtailed it's going to take up
the whole budget. There seems to be a real movement on the part
of your industry and others to try to get some efficiency, so
that you can get better for less or better for the same. One of
the things that has always concerned me is the whole basis of
getting listed on the formularies and the DQTC and the
duplication. Pharmaceutical companies have to submit their
products to the provinces. They then have to submit them to the
federal government. Why would there not be one central agency for
all of Canada where if it meets the Canadian requirement it meets
every province's requirement? What is so special that the
province has to make a determination independent of what the
federal government is doing?
1120
Mr Elston:
I think, in fairness, the result of the history of development of
the drug programs is what has brought these various iterations
together. I suspect that while safety and efficacy is the
hallmark of Health Canada, once they give a notice of compliance
which permits us to go
to market, most people still understand that as appropriate.
What the DQTC and other
provincial organizations are doing is sort of an independent
assessment of what it delivers in terms of value to the
formulary. Unfortunately, our biggest efforts now in most
provinces are designed to control costs and don't look at
outcomes.
We're with you. We think
that the best formulary for the benefit of patients and their
practitioners, the doctors, is an open formulary, so that you
have a menu of products available from which to select. But right
now the interventions are more about controlling bottom line and
preventing quick listings, so that there isn't a huge drain right
away on resourcing.
I think that if the program
is to exist as an effective one, they should reorient themselves
to deal with health outcomes as opposed to the financial
outcomes. While that may look like it flies in the presentation
made by the previous people, it doesn't. We believe that if you
get the right medication, the right therapy, the first time, then
you will save yourself a lot of time, suffering and
resources.
Mr
Christopherson: Murray, thank you for your presentation.
I have to tell you, I feel a lot safer with me asking you the
questions than the way it used to be. But always an interesting
presentation.
I want to ask you something
related, but it may be unrelated enough that you can't respond.
I'm more just fishing for information to get a sense of
something. On the whole issue around genomics, one of the things
that struck me was that of the two teams internationally that
were racing to see who got to the finish line first, one of them
was a partnership of two, three, maybe four public
institutions-most of them I think universities, but there may
have been a couple of others-and a private corporation. I just
wondered if you know what that was, how it works.
I understand the benefit to
that particular company would be they then could be first off the
mark in terms of the transition from R&D into application.
But given the fact that those universities still have public
funding, how does all that wash out from the time that they
strike a deal, and what is that arrangement, to the impact on
patients receiving the benefit of that R&D and its
application?
Mr Elston:
First, I don't know the details of the arrangements, necessarily,
but I know that for instance the Hospital for Sick Kids, through
Lap-Chee Tsui, has just worked out a partnership where they will
end up sharing some of their information about genomics as well
with this organization.
But basically what
happens-I think you're talking about Solara, presumably. They are
actually making some returns on the way they package the material
so that it becomes useful. Everybody knows you can have all kinds
of materials and stats and otherwise, but having the data in
usable forms is really what that is working toward. I think you
will find that it probably makes it much more efficient to have
it in usable form. You'll find people then making quicker
advances with regard to discoveries. So I think that's ultimately
where it will end up.
It probably makes a
shortcut, which will save a huge number of years for some
organizations. But at the end of the day, David, you'll probably
still find out that it will still produce expensive and tedious
research for the women and men who have to make use of the data.
I think it will ultimately shorten it, but it will still be an
expensive experience for them. I presume that there will be some
benefits moving to each of the university players, but I don't
know the exact details.
Mr
Christopherson: This is somewhat related but more just
my personal interest. The kind of pharmaceutical research that's
going on at the international space station, what are they doing
there and what are they trying to achieve that they don't think
they can do here? Again, who is paying for that and are there
partnerships there? I'm not asking for an expert answer, Murray,
but can you give me a sense of that?
Mr Elston:
No, I can't give you an exact sense, but I do know that some of
the materials which are being experimented with are being
experimented with in zero gravity, so that you find that the
crystals are developing differently from the way they might be
able to do them in labs here. It would be extensively different
from the type of work that would be done here, merely because of
its location.
I should say to you,
though-and perhaps I can do this through you, Mr Chair-we would
be extremely happy if we could put together for a group of the
legislators a visit to our research centres in the Toronto area,
for instance. While we have had and will have another pharma-day,
those days are not always amenable to everybody. But if you would
like, when your schedules permit, please contact us, or contact
Zenek or myself, whatever, and we'll make arrangements to see the
very sophisticated stuff that goes on.
As you know, history and
law don't permit you to get into the type of stuff these science
people do. I'll tell you, I'm overwhelmed by the complexity of
women and men who sit at these stations. And it's not just
chemists any more; it's physicists and math majors, it's the
person who does software, it's IT. It's a partnership that is
cutting right across the whole fabric of our research world. So
it's a tremendous opportunity. If you would like to take
advantage of it, please contact us and we'll take you for a
little trip.
The Chair:
On behalf of the committee, thank you very much for your
presentation this morning.
A couple of quick
announcements. I'd like to remind the members that we have to
check out by 12. Secondly, lunch will be served in the dining
room, if you so desire. We have made reservations.
CANADIAN ADVANCED TECHNOLOGY ALLIANCE
The Chair:
Our next presentation this morning is from the Canadian Advanced
Technology Alliance. Could you please come forward and state your
name for the record.
On behalf of the committee, I would like to welcome you. You have
30 minutes for your presentation.
Mr David
Paterson: Good morning, ladies and gentlemen. My name is
David Paterson. I'm the executive director, Ottawa, of the
Canadian Advanced Technology Alliance. My primary role is policy
analysis and advocacy, which is what brings me here today.
The Canadian Advanced
Technology Alliance is the association which represents the
Canadian high-tech industry. We have 600 member companies-247 of
them in Ontario-and another 1,500 companies associated with us
because they belong to associations which have affiliations of
various sorts with CATA. Most of our members are in the
information and communications technology industry, but we also
have biotech, aerospace and advanced manufacturing companies. The
big companies, the giants of the industry, are all members, but
the vast majority of our members, I would say over 90%, are SMEs
with sales of less than $100 million a year. We have almost no
members who don't export. We have almost no members who don't
perform R&D. This is the leading-edge, globally competitive
Canadian high-tech industry that we're speaking of here.
It's not a secret that the
new economy, the knowledge-based economy, is the key to growth in
Ontario and in Canada. Everyone knows that the only really
important raw material of the new economy is people: human
resources, people and their skills. The other critical resource
is money. But one of the things our members have found is that a
good business plan backed by a good management team can always
find money. It will be a little more difficult this year than it
was last, of course, but money will be found for the good
companies.
When we poll our members,
they tell us that human resources are their biggest problem. The
shortage of the talented people they need is the one issue, the
one problem that can prevent them from growing in the way they
would like to, and it will handicap them in the global
competitive environment where they all operate.
Last summer, the government
reported that there were 50,000 vacant jobs in the high-tech
industry in Canada. We believe that was rather an underestimate.
One of the main issues that faces our members is that this is not
a local problem; it's a global problem. In the United States they
believe that the shortage of information technology workers is
over 1.2 million. The shortage is almost exactly the same size in
the European Economic Community. Even India, which was once
considered to be a place where information technology workers,
engineers and programmers were available in abundance, is now
suffering shortages in some of the fastest-growing specialties.
They cannot do all the work they want to do.
1130
There are three sources of
the human resources the industry needs: the current workforce,
immigration and Canadian schools. Our members tell us that
personal income taxes are their number one government issue,
because taxes are a critical matter both for present employees
and potential immigrants. For several years we have pressed
governments hard to reduce income and capital gains taxes to
competitive levels, which will both reduce the brain drain and
attract new immigrants. We finally succeeded at the federal level
with the October mini-budget, which took a major step in that
direction. We will continue to press for further reductions,
however, principally because the target keeps shifting. President
Bush has introduced legislation that will reduce US taxes by no
less than $1.6 trillion. That will put us back at a major
disadvantage.
The government of
Ontario-I'm pleased to compliment you-has set an outstanding
example for other governments in the field of tax reduction.
Personal income taxes have been reduced substantially in recent
years. Of particular interest to the high-tech industry, employee
stock options have been accorded better treatment at both the
personal and corporate tax levels. We urge you to continue to
pursue tax reductions to assist the new economy in its pursuit of
the talented people who are essential to success and growth.
There is one particular
Ontario personal tax matter that we feel should be done away with
in the next budget, and that is the Ontario surtax. It was
established to fight the deficit, which is now gone. It strikes
the highly skilled, higher-income people on whom our members
depend for success. It's all very well to speak of taxing the
rich, but this tax comes into effect at a level where it actually
hits new grads in their first job and young couples who are
trying to save for their first house. It is the sort of
disincentive to working in Ontario that should be done away with
immediately.
At the corporate level
there are three taxes which particularly concern our members. The
first is the Ontario capital tax, a flat tax which is collected
whether a business is profitable or not. It is a strong
disincentive to investing in Ontario, whether to expand an
existing business or establish a new one. There are many places
just over the border, for example, which have avoided capital
taxes for exactly that reason. This is a tax where the phrase,
"Level the playing field," is obviously apropos.
The second problem at the
moment is the clash between Ontario and the federal government
over the Ontario super-allowance and the federal SR&ED tax
credits, about the federal clawback of benefits that was
introduced in the February 28 budget last year. The changes have
the effect of moving much of the allowance from the hands of
those carrying out R&D in Ontario into the hands of the
federal government. While we acknowledge that the problem was
created by the federal government, industry has made a proposal
to the Ontario Ministry of Finance which would essentially solve
the problem, preserving most of the benefits at no cost to the
government. A quick resolution is desirable. Maintaining the
integrity of the super-allowance will be an important
consideration to our members when making decisions about current
and future R&D investments in Ontario.
The last tax problem is
property taxes, particularly as they apply to software companies.
Some of them have begun to report that they have been classified
as industrial activities for property tax purposes and not
commercial, where they belong. The taxes are roughly double in
that case. Software companies are not industrial. They don't do
any manufacturing at all. Even in cases where they distribute
software on CDs in boxes with accompanying manuals and all that
sort of thing, they do none of that production internally. They
contract it all out to specialists in the field.
Last year, CATA took
essentially the same issue before the Workplace Safety and
Insurance Board, because they had begun in a number of cases to
assign software product firms into the very highly rated
industrial categories, the manufacturing categories. We were able
to persuade them that this was not appropriate, that in fact the
differences in the business are so substantial that there was
actually no need for software companies to be compulsory
registrants under the act.
The second issue of
greatest concern to our members after the question of personal
taxation is education. Ipsos-Reid just released a survey which we
had sponsored, which reports that a majority of Canadians
recommend that high-tech leaders put education first on their
list of issues, ahead of the tax matter. Based on on-line
interviews with over 1,000 Internet users, the issues of tax
reform, environmental impact of new industries and social
accountability of businesses were all well behind the education
issue, which 56% felt was the number one issue that should be
pursued.
Education is not a new
issue with CATA. In 1998 we launched our Double the Pipeline
initiative aimed at doubling enrolment in computer sciences and
selected electrical engineering fields in Ontario universities.
The government responded promptly with its access to
opportunities program, initially funded at $150 million and
subsequently raised to $223 million. That program is regarded as
being highly successful by everyone involved: the government, the
universities and the high-tech industry. It's been so successful
that we're in the process of launching it in British Columbia,
where there are problems in enrolment in the universities.
Technical skills are not
the only need. When Industry Canada first began working with the
software industry in 1987, we felt that the shortage of
programmers would be the number one human resources issue in the
industry. We found out almost immediately that that was not the
case, that it was more difficult to find good marketing and
salespeople than it was to find programmers. That's still true.
If you corner one of the CEOs who serve on our board of directors
with the question, they'll admit that it's still the case, that
marketers are harder to find than technical people.
The high-tech industry is
not the only one which is suffering from the lack of educated
employees. This is a universal issue now. As the baby boomers
approach retirement, it's clear that replacing them is going to
be an extraordinarily difficult problem. It's an enormous problem
in all of the professions and in the skilled trades. Steps must
be taken now to expand enrolment in apprenticeship programs, in
colleges and in universities to meet this need or the negative
effect on the Ontario economy is going to be very severe.
The federal government has
committed funds to expanding university education in the areas
that fall within its jurisdiction. Ontario has taken significant
steps with the SuperBuild financing, the $1.6 billion which is
going to go into expanding capacity in the Ontario college and
university system by 73,000 by 2004.
The issue that remains
unresolved, however, is the operating funds which are essential
to the universities if they're going to be able to go out and
recruit the staff they need in what is now another globally
competitive environment, where all the universities in the world
are faced with essentially the same problem of replenishing their
staff.
It's obvious that education
pays well; there are plentiful statistics to prove it. Strictly
in the jobs market, for example, from 1990 to 1999 employment for
Canadians with post-secondary education rose by 2.25 million. For
those with a high-school education it only rose slightly over
100,000. For those who failed to complete high school, the actual
number of jobs available dropped by almost one million. The
situation hasn't changed today. There has recently been publicity
here in Ottawa about layoffs by high-tech firms. The people who
were laid off were contract employees on the factory floor. We
know, because our members are telling us this all the time, that
they are still hotly pursuing the high-quality engineers, the
programmers, the marketing staff they need to grow and expand and
compete.
1140
The educated obviously also
earn a great deal more. The best figures we have are from the
1996 census, which makes you wonder how far the knowledge economy
has expanded in the statistical world, but that's another issue.
People with university degrees had an average employment income
of $42,000; people with high school diplomas made only $22,000;
and those who didn't get that far earned slightly less than
$20,000. So the return on a university education is
extraordinary. It is extraordinary both for the citizens who have
pursued education and for the governments which have
substantially funded that education, because it's rather obvious
that the government of Ontario is going to gain a lot more in tax
income from someone with a university education than they will
from someone who is just stumbling along trying to get by on the
minimum wage.
From the perspective of the
high-tech industry, Ontario needs to move quickly on the two
issues of reducing taxes, personal taxes in particular, and
continuing to increase support for education. If it does so, CATA
members in the high-tech industry, and all Ontario businesses,
will be in a strong position to compete in the global economy and
to ensure continued growth and prosperity for Ontario.
The Chair:
Thank you very much. We have three minutes per caucus. I'll start
with Mr Patten.
Mr Patten:
Thank you, David. It's good to see you. I was at one of your
educational sessions, which I found most illuminating. I have only a short time
here and I'm interested in your comments related to education. In
some of my discussions with (1) some of your members and (2) some
of the people at the university, college and even at secondary
school level, there is a big worry. The worry is that a high
school graduate today is not particularly well skilled for your
industry; perhaps retail, maybe, which is minimum wage, more or
less, and not too much else. But at our college and university
level in Ontario, if we're not number 10, we're at number 9;
we're one of the poorest per-student-supported systems in Canada,
and perhaps even in North America. In light of the indications of
your members showing that this is even a higher priority-I was
surprised to see that-than the taxation issue, that it was
recognized as the ultimate resource, the human resource and their
skills, can you comment on that? What is your advice to the
Ontario government in light of the position we are in now and
where we must go, making the assumption, perhaps, that Ontario
would like to see us being a world leader in the technology
field?
Mr
Paterson: It's our view that this is a critical issue.
We recognize that the SuperBuild fund and the money that has been
made available for the capital costs of expansion to meet the
expected growth in enrolment in colleges and universities is a
major step. That's a large piece of money. It has been warmly
welcomed by the universities. But you cannot do it all with
capital spending. You must have the right operating budgets to
support that. Tuition fees have made, I am almost certain, the
only contribution to increased operating budgets in the Ontario
universities over the past few years. But they are now at levels
where you can't say that the students are not contributing
substantially to their education. There need to be more operating
funds made available to the universities and the colleges if
they're going to be able to meet the demand to provide a quality
education, and quality is the critical issue. It's not a question
of bums in seats; it's a question of minds that need to be
developed.
Mr
Christopherson: Thank you for your presentation. You
raised an issue that we're finding-actually I've been surprised
during the course of the hearings that it's widespread across all
sectors of our economy, the lack of skilled workers-has virtually
come up from every end, from the construction end of things all
the way through to the high-tech end and everything in
between.
You just placed your
emphasis in response to Richard's comments on quality education,
recognizing then that quality education is going to cost. I've
been referencing during our hearing the TD Bank presentation by
their chief economist, pointing out two separate charts on where
we are not spending the same money on post-secondary education as
our competitors internationally. We heard this morning the
concerns in the Ottawa-Carleton area about the elementary and
secondary school systems and their lack of funding. You also
throughout the presentation talked about wanting to make changes
to corporate taxes, capital taxes, personal income tax and
property tax, all in the way of paying less, which is what you're
lobbying and advocating-and that's fine, that's why we're
here.
Now, that leaves us with a
huge problem. Even if the government surplus held, and I have my
doubts now as to whether or not by the time the transfer payments
come in from the federal government based on the revenue and GDP
of the country-and the province as it relates to us-that's going
to hold, but even if it did, the amount of money we need to bring
our education system back to par, I think to the level you want,
would surpass the surplus. We're talking in the billions of
dollars. Can you help us get through the notion of trying to
either do both or which one is the higher priority and in the
best long-term financial interests of Ontarians?
Mr
Paterson: Our members believe that you can continue to
pursue growth by applying both strategies: lower taxes and
greater spending on education. It's not going to be easy-it's
never easy-but the fact remains that Canada has to live in a
competitive environment, and if the tax structure here is grossly
out of line with our next door neighbour, it's going to influence
people's behaviour. They just pack up and go. On the immigration
side, certainly we have a very good record, but the fact remains
that there are still lots of high-quality people whom we could
get with a more competitive environment, who are going to the
United States.
Mr
Christopherson: You mention "environment." They'll
probably want an environment where they can breathe the air and
eat the food that we grow and drink the water, and that costs
money.
The Chair:
Thank you very much, Mr Christopherson. You've run out of
time.
Mrs
Molinari: Thank you very much for your presentation.
It's interesting, some of the recurring themes of the need for
post-secondary education to recognize the needs of the century
we're moving into and to adapt to some of the innovative ways.
Certainly as a government we recognize that and are making some
initiatives to move in that direction. You've named one of them,
the access to opportunities program that we've initiated. There
are a number of others. Just to state a few: the $750-million
Ontario Innovation Trust is helping to fund labs, high-tech
equipment and other research infrastructure at universities,
hospitals and colleges; and the Ontario new technology tax
incentive that provides companies 100% income tax deduction on
the cost of eligible intellectual property acquired for use in
Ontario. Those are just some of the innovative ways that we're
trying to address the issue.
1150
The issue of need for
people in the high-tech area-and you've also mentioned the
shortage of carpenters, masons and machinists-we've heard
repeatedly, over and over again. A number are retiring in those
fields and we need to replace that workforce. Part of the
difficulty is finding students who are interested in entering
those fields as well, because as a government we can do as much
as we can to provide the spaces and provide the support, but you
also need students who are interested in getting into those
fields.
I have two questions. One is, what would you
suggest that we could do to encourage students to enter those
fields? The other is, as a government we've just passed Bill 132,
which will allow for private universities and colleges to grant
applied degrees. We think this is another way to open up more
opportunities for students. I would like to know your views on
those two points.
Before I give the floor to
you, I want to clarify some of the comments made by my Liberal
colleague Mr Patten, that the money we're investing in
post-secondary education-I think he referred to a number as us
being the ninth, but I guess it depends on what you do with
numbers and where you put them. We're actually in the top five,
when you take into account some of the investments that we've
made for student assistance in a number of areas, and the tuition
fees have been restored so the student pays one third of the cost
of the actual tuition fee. Those are a number of areas that we've
moved in to address some of the concerns.
If you could take a few
minutes to answer those questions for me, as to how we could
encourage more students and your thoughts on private universities
and granting of applied degrees for colleges.
Mr
Paterson: The difficulty in attracting students into the
trades, into the apprenticeship programs and that sort of thing,
I think is related to the perception that these are not good,
interesting, well-paying jobs-that's what it amounts to. It's
glamorous to be an engineer or a programmer; it's not glamorous
to be a mason. I happen to know somebody who is just finishing up
his apprenticeship to be a mason, and he is someone who had tried
a number of different things before. He's still not sure how he
became interested, but he has a lineup of people waiting to hire
him because there is a shortage of masons. He is going to make
money like it's going out of style, and he's going to be doing
something that he really enjoys.
How do you get messages of
that nature into the school system? I am not sure, but I do know
that quite apart from the people our industry needs, there are
huge opportunities out there in many of the trades. Somehow or
other, I guess they just have to be glamourized and young people
have to understand better what the opportunities are. They may be
bored with sitting in a high school classroom, but that doesn't
mean they should just pack up and go and take the first job that
comes along. There are other opportunities out there, for which
further education is required, that are going to be extremely
remunerative.
The Chair:
On behalf of the committee, thank you very much for your
interesting presentation this morning.
Mr
Paterson: It was a pleasure to be here. If anyone has
any questions, by all means give me a call or send us an e-mail.
We'll be glad to oblige.
The Chair:
Thank you. Unless there are any questions from members, the
committee will adjourn until l o'clock.
We are now adjourned.
The committee recessed
from 1154 to 1258.
OTTAWA-CARLETON CHILD POVERTY ACTION GROUP
The Chair:
I'd like to bring the meeting to order. Our first presenters this
afternoon are representatives from the Ottawa-Carleton Child
Poverty Action Group. Could you come forward and state your name
for the record, please. On behalf of the committee, welcome. You
have 30 minutes for your presentation.
Ms Christina
Marchant: My name is Christina Marchant.
Mr James
Kuhns: My name is James Kuhns.
Ms Lynn
Sherwood: My name is Lynn Sherwood.
Christina is just getting
the overheads sorted out here.
We're representing the
Ottawa-Carleton Child Poverty Action Group. I just want to say a
few things. The Toronto Child Poverty Action Group made a
presentation to you last week, and we don't want to bore you
silly by saying the same things over again. So some parts of the
statistics in here we're not going to repeat; we'll go on with
other things so it'll be more useful to you that way, because
there's a lot to talk about.
Ottawa-Carleton Child
Poverty Action Group focuses on the children in Ottawa. Last
year, the Social Planning Council of Ottawa-Carleton did a
poverty report card on children which estimates that 23% of the
children in the city are living under the low-income cut-off line
established by Statistics Canada; 12% of our families are living
on less than $20,000 a year. A substantial proportion of the
citizens of this city have been in poverty for generations and
have known no other form of life.
Last week, the Fraser
Institute rated the economy of Ontario as the third strongest in
North America. Between 1989 and 1997, at the same time, the rate
of child poverty in Ontario increased 118%.
In this millennium, we can
e-mail people in Thailand, a place my grandfather never knew
existed, just as easily as we can phone a takeout pizza outfit
down the street. We can send people to orbit the earth in a space
station and we're unravelling the histories of the human genome.
But we seem to take for granted that it's inevitable that one
fifth of our children are going to grow up in poverty. We're
saying that we don't think the status quo is any longer
acceptable or necessary in this society. We think we can
eradicate child poverty if we have the will to do it.
A hundred years ago, it was
accepted that children would die from smallpox, scarlet fever,
whooping cough, polio, diarrhea, and it was thought to be God's
will, that there was nothing anyone could do about it: "It's too
bad, but that's the way it is." We know that isn't the way it
really was, that these diseases were the result of poor
sanitation, and we've eliminated these diseases as killers of our
children.
Our acceptance of high
poverty rates among children in this day and age means the
impoverishment of everybody in Ontario. According to all
research, poor children have more health problems and less
success in primary school. They drop out of high school earlier.
They're more likely to
be clients of the child welfare and juvenile justice systems. As
adults, they're likely not to live as long as the rest of us.
We're talking about
jeopardizing 20% of our population, of cutting their lives short.
If this was an epidemic of a physical disease, we'd be up in arms
about it. We're permitting conditions of life that deny 20% of
our children the right to full participation in our society and
we're denying the rest of us the opportunity of discovering the
potential of these children, because they never get a chance to
realize their own potential.
Just as roads and bridges
and sewers represent our physical infrastructure and must be
maintained and developed on an ongoing basis, our children are
our social infrastructure. We can't afford to let 20% of our
children live in these conditions.
In this information age,
there's less and less need for low-paid, low-skilled, casual
workers. We need educated, self-motivated, socially sophisticated
workers in our new economy. We don't get that if our children are
growing up poorly nourished, poorly housed, poorly educated,
alienated from the community because they're moving around so
much they don't have a community, and angry because they can see
very clearly what the rest of us have and they don't. Think of
this as squandering our social capital: our children.
We're going to detail a few
of the issues that we think you folks can look at in terms of
planning for the future economy of this province.
We think you could begin to
implement measures which would cleanse Ontario of the social
disease of child poverty, just as we cleansed our cities of the
infectious diseases which killed our children 100 years ago. I'm
turning over to James for the next session.
Mr Kuhns:
Thank you, Lynn. I'd like to talk about the income of families
with children on social assistance. The Social Planning Council's
report, The Challenges our Children Face, states, "For the
community to receive a passing grade, every family ... needs an
income which is adequate to meet the needs of their family." In
Ottawa and indeed in Ontario this is not happening. Children
often are the unintended casualties of the three income-related
areas we wish to speak to.
First, the social
assistance cuts: in October 1995, the provincial government cut
the maximum amount of social assistance benefits by 21.6%. These
benefits have not been raised since. Taking inflation into
account, the total cuts are now in the 25% to 30% range. The
welfare cuts have resulted in people being forced to live in poor
and inadequate housing, having to move frequently or become
homeless, suffering from poor and deteriorating health, largely
due to poor nutrition, and not being able to afford decent work
clothes, transportation and telephone services.
The cuts have placed a
great burden on the poor and jeopardized their ability to move
out of poverty and into work, which is something we all want.
Tax cuts by the provincial
government will be of little or no benefit to low-income families
and will take away money from the treasury that otherwise could
be spent on programs for poor families and children. What's
needed is government action to ensure that the poor have enough
income to participate fully in society.
Moving on to the national
child benefit supplement, this program came into effect in 1997
and replaced the family allowance benefit, which was available to
everyone. The framework allowed provinces to claw back the
supplement from families on social assistance and to reinvest
that money in programs for children. The child benefit
supplement, with its current clawback option, is discriminatory.
Families on welfare have the supplement deducted from their
social assistance cheque, leaving them no better off than they
were before. We believe that the money should be left in the
hands of social assistance recipients, who are best able to
decide how the money should be spent.
In May 2000, Manitoba
became the third province to end the clawback because of what
they perceived to be the growing depth of child poverty. We
recommend the Ontario government follow Manitoba's recent lead
and repeal the clawback.
I have a few points on the
minimum wage. It's been at $6.85 since 1995. Originally it was
conceived to be a living wage, but over the past few decades it
has consistently fallen in real terms, leaving the roughly
500,000 Ontario citizens in the minimum wage jobs with far less
purchasing power. We believe that an Ontario strategy to reduce
child poverty must include jobs with decent wages to enable
parents to provide adequately for their children. To take
inflation into account since 1995, we would recommend that the
minimum wage be raised to $7.50 an hour.
Lastly, I'd like to talk
about one of the realities that low-income families face, and
that is food insecurity. Despite a buoyant economy in Ontario in
the last few years, food bank usage continues to grow in Ontario.
According to the Canadian Association of Food Banks' Hunger 2000
report, in March 2000, 283,000 people were forced to use food
banks to feed themselves and their families. Of that number, 42%
were children.
There's also been another
noticeable trend emerging: more of the working poor need to use
food banks to get by. In Ottawa, the main food bank provides
assistance to over 32,000 people each month; 44% are children. In
the past year, the number of agencies that the Ottawa Food Bank
serves has grown from 70 to 83, and currently another 15 social
service agencies have applications before the Ottawa Food Bank,
including many school breakfast programs.
The situation of food bank
users with babies is critical in Ottawa as well. Recently the
Ottawa Food Bank began purchasing diapers, formula and baby
cereal to ensure the parents were able to provide adequately for
their children. But charitable handouts are not a permanent
solution to the problem. What is needed is more income in the
hands of the poor.
Thank you, and now
Christina will talk about housing.
Ms
Marchant: Hello. I'm not going to read everything that's
in our brief, because it's in front of your eyes, but I just want
to highlight a couple of things for you.
First of all, my understanding is that the
Conservative government over the last year has viewed a solution
to housing as being removing the barriers that prevent the
private sector from building, so that more housing can be built
and more building starts can be encouraged. We believe that
Ontario's given the strategy several years to show success and
that it's not working very well. Some evidence that it's not
working: CMHC estimates show that the rental prices in Ottawa
have increased by about 12% since November of last year; 41% of
renters in Ottawa pay more than 30% of their income on housing,
on rent, and in fact many families who leave social assistance
rosters and move on to paid jobs usually are moving into paid
jobs that are at minimum wage and they can't afford to pay their
rent, for example.
1310
In addition to rental
prices rising, rental housing is in very short supply. Our Ottawa
rental vacancy rate is somewhere between 0.1% and 0.2%, and the
housing availability is so limited that landlords are at the
discretion to screen out tenants whose incomes may not be high
enough to give them assurance that the rent will be paid every
month. We've heard anecdotal reports that vacancy decontrol is
allowing landlords to set the rent at whatever the market may
bear and sometimes giving landlords the incentive to evict
tenants for reasons what may not be reasonable reasons.
We're also hearing that the
tight market is resulting in bidding wars between prospective
tenants, and that's meaning in the main that only people with
higher incomes can afford housing in our region. That's causing a
problem for poor families and the poor children who live in those
families.
In the past people who
couldn't afford the market rents could apply for social housing,
but both provincial and federal governments, as you know, have
cancelled any new housing starts and responsibility for social
housing has been downloaded to municipalities without any
additional monies for that. That's making the problem worse.
Again, this is probably not news to you, but we feel it's
important to tell you.
In Ottawa today there are
about 15,000 families on a waiting list for subsidized housing,
and the wait takes between five and seven years to get that
housing. So in our opinion there is insufficient housing for the
need and we believe that it's our government's responsibility,
and your responsibility as a finance committee, to help the
situation by putting new money into permanent affordable housing
for Ontarians.
I also wanted to draw
attention to the current strategy for getting people off welfare
and into paid employment. It's helping to create a whole new
class of homeless people in our region. As has already been
mentioned, many of the new jobs being created are in the service
sector and pay at or close to minimum wage. Even full-time work
at minimum wage isn't enough to help people pay market rent,
provide for food and other essentials of life, and transport
themselves to work. A single mother working at minimum wage would
earn about $1,100 a month and even if she and her child lived in
a one-bedroom apartment she would only have $300 to cover
everything after she had paid her rent. Obviously that causes
problems.
I also wanted to draw
attention to the housing crisis. It's exacerbated by the low
shelter allowance on Ontario Works. The maximum limit, as James
said, hasn't changed since 1995. We believe that in order to
support poor children that shelter allowance on Ontario Works
needs to be increased commensurate with inflation and the rising
costs.
I also want to draw your
attention to the need for other supports. Besides housing
supports, poor families need other supports to become
self-sufficient as well. We believe that a strategy to address
child poverty that relies only on economic factors without a
strategy that also focuses on other services, housing and so on,
won't be as successful. We think the economic recovery that
happened during the second half of the 1990s didn't bring about
widespread benefits and prosperity, and with the expected
downturn the situation is likely to become worse for the poorer
people in our province.
From that perspective, we
believe the changes that were made to STEP-that's the supports to
employment program-back in October 2000 were punitive and are
unlikely to meet your government's stated goal of moving people
from welfare to work. The changes reduce the amount of money that
people can earn and keep while on social assistance. We think
they're going to impose punishingly high marginal tax rates on
people who increase their earnings, rather than increasing the
incentive to move off social assistance and get full-time
employment. We think the changes actually impose penalties for
trying to move off and cause more problems than solutions for the
people who are living in poverty. So, obviously, one of our
recommendations is for you to repeal the changes to the STEP
program and increase the encouragement of people to make
additional income while they're on social assistance.
One final comment from me:
we'd like to comment about the $800 million in funds that are
coming to Ontario as part of the national children's agenda.
Given the current state of Ontario's children, as Lynn described
it, it's essential that those new monies be put directly into
services for children in our province rather than being put into
the general Ontario coffers. So we encourage you to pay attention
to that guideline and, as I said, put the funds directly into
services for children.
Now I'll turn things back
over to Lynn to talk about child care and education.
Ms
Sherwood: We think that child care and education are
very vitally important to decreasing poverty among children in
Ontario. School is the first experience a child has of the
society outside their own family. If we want to get kids out of
the poverty cycle, get families out of the poverty cycle, they
ought to think of school as being a good place to be, and the
wider society, therefore, as being a nice place, not something to
be afraid of. Most of our poor families are afraid to be outside
their families and
their own community because everything they experience is so
punitive. You start out with the schools. You make the schools a
good place to be and you make child care a good place to be, and
children are going to have motivation, are going to have an image
in their minds of something other than the life their parents
have known. This is where you start; this is really
important.
As you can see from these
charts, quality, accessible child care is needed and is almost
impossible for people to get at this stage in the game. There is
a lot of documentation on the need for child care and the costs
of child care. We have it all written down here. I can recite it
to you if you want. I think the folks last Tuesday did the same
thing. The evidence is there; it's statistical.
Right now, we have the
highest fees in Canada for full-time regulated child care and
people can't afford it. They can't get into it. In Ottawa, the
average cost for licensed preschool daycare is $637 a month.
Licensed daycare can cost $1,141 for infants and toddlers.
Subsidized daycare is the only option for low- to medium-income
families and there is not enough subsidized daycare, let alone
subsidized good, flexible, accessible daycare.
I am a social worker. I
work with people. Every day in my office I have people, a lot
them young moms because I work with families, coming in and
telling me their stories. I don't know what to do. I have one
young mother who is trying to provide French daycare for her two
preschool children. She came from an abusive situation. She is
working full-time, mind you, as a clerk with the federal
government. She is trying to keep her job. She is trying to raise
her kids. She is trying to deal with the trauma surrounding
leaving her guy, who was awful. We had to try and keep her in
subsidized daycare.
The only house she could
purchase was in Bells Corners and the only daycare we could find
was in Vanier. That meant she was travelling 30 to 40 kilometres
one way with two babies every morning to take them to their
daycare centre in Vanier, before she went back across town to her
job with the federal government. Then she had to go back and get
them at night. You guys have seen what the weather is like here
in Ottawa. This woman is driving a 10-year-old car. She is
driving 50 kilometres a day, one way, with two babies in the back
seat. She had to get up at 5:30 in the morning. Do you know what
that does to little kids? It was awful.
The mental health problems
that result from this kind of daycare crisis are extraordinary,
and the cost to the children is huge. We shouldn't be doing this
to little kids. These kids were up at 5:30 in the morning and
they didn't get home until 6:30 at night. They spent three hours
a day travelling back across the city on the Queensway in foul
weather in a decrepit car. The mother was always late for work
and she nearly lost her job because of the daycare issue. This
isn't an uncommon thing. This is standard for a lot of single
parents in our community.
Another situation I dealt
with was I had a mom come in who's having behaviour problems with
her four-year-old. I find out she is working the early shift at
Tim Hortons. She has to get her children up at 4:30 in the
morning, take them to the neighbour where they stay until their
before-school daycare program is open. Then they go to the
before-school daycare program, they go to school, they go to the
after-school daycare program, and she picks them up and takes
them home. I'll bet she has a really nutritious meal on the table
after a day like that. This is the life of a four-year-old child,
and we wonder why he's hard to get along with, why he's
aggressive and acting out.
These children have no
childhood. It's not right and we should stop it. We should give
them proper care. We should give them a chance to stay at the
same place for a consistent period of time and not be trucked all
over the city in all kinds of weather at weird hours by
exhausted, stressed-out parents who are trying to make a living
when they can't. We shouldn't be doing this. We need quality,
affordable subsidized daycare that's accessible to all our
children.
Another situation that I
deal with regularly is this business-you could solve this one in
this budget really easily-of the RRSP, that you won't let people
have subsidized daycare if they have an RRSP. A lot of people
don't live in families with two young parents who are both
working, and working in jobs where they have company benefits. I
know a woman who is 50 years old and is raising her grandchild.
She's working five days a week as a clerical assistant and two
days a week as a nurse's aide at an old people's home in order to
support this child. She has the child in subsidized daycare. She
has a private RRSP because neither of the jobs where she's
working has a pension plan. She had to cash in her RRSP in order
to provide care for her grandchild. What security does she have
in her old age? None.
1320
These kinds of situations
are not uncommon. There are lots of stories like this. It's a
simple thing to fix, and I really wish you'd do it. It's not
right. I understand that you're worried about people abusing the
system, but if people are the kind of people who are going to
abuse the system, they're going to figure out some way to do it
anyway. The ones who get used and abused are these folks who are
playing by the rules, and they're really getting screwed over, to
be quite frank. It's not right. As a social worker in practice,
what can I do to help them? Nothing. How can I fix this? I can't.
It needs motivation from you folks who have the power to try to
fix some of these situations that are causing a lot of pain for a
lot of our people.
I want to talk a little bit
about education. Daycare might be the first step for a child
entering the larger world, but education is the second one, and
right now the education system in Ottawa is a huge mess. It's
pretty awful; it really is.
At CPAG, we've been trying
for a year now to find out how the learning opportunity grants
are being used at the Ottawa school board. We've sent several
letters. We've had no response. These grants are supposed to be
designated funds from the provincial government to local school boards to provide
special supports to schools in high-risk neighbourhoods. That's
so these kids get school supplies, special outings, enriched
programs, stuff like that. It's not happening. We believe these
funds are being rolled into general revenues of the school boards
so that they can increase the salaries of the teachers, because
they are really worried about teachers going out on strike, as
I'm sure you all are. The children in these communities are not
getting their special outings. Parents are telling me they are
having to buy school supplies. For somebody on an income of $950
a month, having to go out and spend $75 in September for school
supplies for their child-and God help them if they have two
children-is just huge. This means no food. These kinds of things
are very serious. They are going on, and we're not doing anything
about it.
We all hear about school
breakfast programs, and I know you are partnering and trying to
get local industry to support school breakfast programs-which
they are not doing, by the way, but that's the way you want it.
What happens to the mind of a child when she's sent off to the
school breakfast program knowing her mother hasn't got any food
at home for herself? The children get fed, but the parents
starve. What does that do to a child and a family? What would it
do to your children if they knew you couldn't eat, in order to
give them food?
The institution of school
councils means that the children in neighbourhoods where parents
have enough energy, resources, sophistication and knowledge to
organize themselves and to get things for the school get things.
In disorganized neighbourhoods where people are fighting for
survival, they don't get things. The schools are inferior; they
are overcrowded. The teachers get fed up. An adversarial attitude
toward the children inevitably develops between the teachers and
the parents in these schools. As a social worker, I spend a lot
of time trying to sort this one out. It's not possible. The
teachers in these communities are exhausted and overstressed, and
the special supports aren't there any more. School social workers
have been cut back; school psychologists have been cut back;
special services have been cut back. The only way to handle these
children is to medicate them. So we drug them, and then when
they're 15 we put them in jail for using drugs. It doesn't make a
lot of sense to me.
We feel the situation for
poor children in Ontario is deteriorating. We know it is; I know
it is. I really would like you to listen to us and to pay
attention to some of the things we're recommending. I'm not going
to read these recommendations over. There are a lot of them; they
are listed here.
I am going to say that we
have not talked about a lot of other things that are going on.
We're not talking about the increasing cost of utilities-natural
gas, for example-without an increase in the money poor folks are
getting or in the minimum wage. Where do they get the money to
heat their houses?
We're not talking about the
fact that the government directly deposits social assistance
cheques, so people have to pay bank fees in order to get their
money out of the bank to spend it. They pay the same bank charges
whether the cheque is $20 or $2,000. They have the same bank
charges as we do. They pay a lot.
We're not going to talk
about what user fees for recreational services mean for kids on a
snowy Sunday afternoon in February.
What we are saying is that
as Ernie Eves, the finance minister of Ontario, said in the year
2000 budget, "Of all the investments we make today ... none is
more important for the future of our province than those we make
in our children."
I urge you to consider what
we're saying. Think about it, and incorporate in your budget
planning some measures to relieve this crisis of poverty among
our children.
The Chair:
We have run out of time, so there will be no time for questions.
On behalf of the committee, thank you very much for your
presentation this afternoon.
OTTAWA ECONOMIC DEVELOPMENT CORP
The Chair:
Our next presentation is from the Ottawa Economic Development
Corp. Could the presenter or presenters come forward and state
your names for the record, please. On behalf of the committee,
welcome. You have a half-hour for presentation, and what you
don't use within that half-hour we'll divvy up among the three
parties for questions. You may proceed.
Mr Chris
Henderson: Thank you very much, Mr Chairman. I certainly
will not take a half-hour for the presentation. I can assure you
of that. We'll be about 10 to 12 minutes.
My name is Chris Henderson.
I'm the chief executive officer of a company called the Delphi
Group, which works in the high-tech industry, particularly in the
environmental technologies area. It's also my privilege to serve
as vice-chair of the Ottawa Economic Development Corp, which is
the voice of economic development in our community. We work very
closely with other business organizations, like the
Ottawa-Carleton Research Institute, the board of trade, now the
Greater Ottawa Chamber of Commerce, and other organizations.
I would also like to
introduce Mr Michael Darch, who is the interim president of our
organization.
In particular, OED is a
public-private partnership that acts as the voice of the
exporting sector of Ottawa's economy. We're very focused on
helping our companies export globally. One of the things I'll be
sharing with you is some of the real focus we have on the US
market. We're there to raise our international image and to
attract knowledge workers, investments, companies and
customers.
We also work to foster
growth, improve efficiencies and encourage competitiveness, and
we feel there must be a commitment to invest in leading
technology sectors, those that are driving the prosperity of
Ontario and Ottawa. I would note that the Ottawa of today is the
Ontario of tomorrow. We feel we're a large part of the increasing
drive to a knowledge economy in our province, and I think that bodes well for the
future economy in our province.
The 1990s saw the
provincial government shift financial management strategies and
significantly reduce Ontario's deficit. Frankly, this strategy
has made our province more competitive. We have done
extraordinarily well during these times, and today our economy is
strong, diversified and poised for even better growth. Our growth
has not been a surprise to outsiders, and it's not a surprise to
us. We know what our strengths are, and we have built on them. We
know what our engine is, the part of the machine that keeps us
running smoothly. Without regular maintenance, care and
investment, we will stall on the side of the road. In the new
economy, it is skilled people and infrastructure that keep us
moving forward.
1330
We are here today, Mr
Chairman, to give the message to you and your colleagues that we,
the businesses of Ottawa, expect all levels of government to work
together to ensure the long-term sustainable success of our city
to the benefit of the people who live here.
Ottawa's economy is much
more diversified in 2001 than it has ever been in the past. We
now boast, as you well know, a very strong technology industry, a
growing tourism industry and a healthy federal government. Our
unemployment rate is 5%, well below the Canadian average and the
lowest in over 14 years. Our population in our new city of Ottawa
has grown to 1.2 million people. We're a technological centre on
par with any in North America, and we are competing at the
highest levels. In fact, we have to compete at the highest
levels, as I'll illustrate shortly.
We make this claim with
confidence. There have been more than 26,000 advanced technology
jobs created in Ottawa in the past two years, 50,000 since 1993.
This translates to a 74% increase in high-tech jobs since 1993.
By way of example, over the same period our competitors
globally-San José had a 36% increase, Dallas and Austin both
had 54% increases and Boston had only a 10% increase. We're
catching up, and that's good news.
The number of technology
companies located in our city has doubled from 500 to over 1,000
in seven years. As you well know, many of these companies are
large and established, many are emerging and growing very fast
and some hold new concept ideas that may break open
high-technology markets in the future.
A true indicator of
Ottawa's arrival on the mainstage is the fact that venture
capital has grown from $1.5 million early in the 1990s to $1.3
billion last year. One of the continuing challenges we've had in
OED is to estimate how much venture capital came to the city last
year. We've had to revise our estimate virtually every two to
three months. That's the kind of revision we like to make. We see
this trend continuing. In fact, over that seven-year period,
venture capital in the community increased by 88,000%. That's a
ridiculous figure, but we came from a low figure to a very high
figure. That represents over a quarter of Canada's venture
capital in 2000, with less than 4% of our country's
population.
That venture capital has
come from many sources. It's come from local entrepreneurs,
locally established companies, angel networks, high-net-worth
individuals in our community and certainly from venture capital
investors throughout Canada and the US and in some cases even
Europe.
Compared to US cities,
Ottawa's 1993 to 1999 growth of 88,000% compares to Austin's at
14,000%, Boston's at 1,400% and Atlanta's at 350%. The first
three weeks of January this year saw more venture capital
invested than in the entire year 1993.
Yesterday's economy was
dependent on one industry in our community. In 1975, 35% of our
labour force worked for the federal government. In 1995, federal
downsizing turned our attention to the overnight appearance of
the technology industry. In fact, it wasn't overnight; it had
been building since the early 1970s.
As of this year, the
technology sector has caught up to the government in terms of
total number of employees in our community. The over 1,000
advanced-technology companies employ more than 79,000 people. Not
only is the technology sector strong; it is also diversified.
This leaves us much less vulnerable to hiccups in our economy
than if it was concentrated in any one particular sector.
The advanced technology
industry in Ottawa generates annual sales of C$17 billion. Ninety
per cent of these products are exported outside Canada. The
strengthening of all these sectors will strengthen Ottawa's
economy and in turn Ontario's economy.
The federal government,
traditionally the only industry upon which Ottawa's workforce
depended, has now been joined by our technology sector. As you
can see, the federal government used to provide work for some 35%
of the workforce. This has declined to 17%. In stark contrast,
the growth of the technology sector has gone from only 3% to
almost 18%. This marks a significant shift in who is doing what
around town.
Some context of where we're
looking to see our growth continue: for decision-makers-the
people we sell our products to, the people who help bring talent
here to Ottawa, the people who invest in our companies-there are
six top indicators to get a city on to their field of vision.
They see the first item of importance as strong clusters of
companies. This is where we're really starting to stand out in
areas like photonics, telecom and others. A skilled workforce: we
seem to have a skilled workforce, but I can tell you every
technology company in town, including mine, is continuing to look
for more people. They look for access to points around North
America and the world and a strong academic community, and we're
enormously proud of the institutions in our community, with
Algonquin College, the University of Carleton, Ottawa U and other
training institutes. They look for leadership in research, and
we've had a strong history, a strong pedigree of that, but we
always have to keep innovating. We can't stand still or we'll
lose that positioning. And they look for a high quality of
life.
The qualities and features
that make Ottawa competitive include a diverse technology
industry and a highly skilled workforce. We have leaders in research
and innovation. Our quality of life is ranked superior to many
places in the world. We have access to the federal government. We
have an exceptionally affordable standard of living. And we're
proud of our diverse cultures and languages.
In August 2000, the Ottawa
Partnership, a co-operative effort between private and public
agencies in Ottawa, tabled a report called A New Economic Vision
for Ottawa. This report gave us a glimpse, for the first time, of
our competitiveness as a global technology centre. The results
have been taken a step further by our branding and marketing
strategy, now nearing completion: branding and marketing to make
our name, our products, our companies known throughout the world,
particularly in the United States.
Each sector was examined
individually and the main opportunities and challenges were
identified. The reports show clearly that Ottawa must grab the
attention of key US decision-makers; that's the litmus test of
our success. This means we must partner with other leading-edge
technology cities, and there is a set of US cities whose
attributes are similar and complementary to Ottawa. You see those
on the map beside us. They include San José, Austin and
Dallas in Texas, Atlanta, Washington-the greater Washington area
is a high-tech mecca-Raleigh-Durham and Boston. That's where we
fly to every day. That's where we go on our sales missions.
That's where we go looking for investors.
The better Ottawa's
economy, the better Ontario's economy. The stronger our economy,
the stronger the provincial economy.
The Conference Board of
Canada predicts Ottawa will have the fastest-growing economy in
Canada this year. We did that in 2000. Based on the estimates of
new jobs in Ottawa over the last two years, the provincial
government has received an additional $250 million in revenue,
and this additional revenue continues year after year, growing
and building on itself, one of the real social upsides of
growth.
As well as we are doing, a
community cannot take things for granted. Our prosperity and good
fortune will not continue unless we continue to invest. We
believe there are three potential threats we must answer
together, and that's why we're delighted you're here in Ottawa
today. Each must be addressed if we're to continue to foster
growth, improve our efficiencies and encourage our
competitiveness.
First, prima inter pares,
is a skilled workforce. We together, but we in industry as well,
must train, recruit and retain our pool of the best and the
brightest in the world. We're doing that. It's hard work. We're
investing in it. We're taking the time and money to do it, and
we're not going to stop. We look for your co-operation in doing
that.
The second is what we call
business infrastructure. That includes everything from our roads
that move people to the wires that move our information, the
hospitals that serve our residents and the facilities that host
our meetings, conventions, companies and visitors. Clearly, you
can appreciate there's a very strong partnership role with the
provincial government on this count.
We also need to look, in
this area, at risk capital for our existing and future companies.
Those three challenges-a skilled workforce, business
infrastructure and risk capital-are the ingredients for continued
success. That all fuels the entrepreneurial spirit that must be
supported with real measures to support our private sector
growth.
All this said, even with
all the media attention Ottawa has received globally, in Canada
and throughout Ontario in the last few years, we're still a
hidden gem. Our profile is enormously less than our competitors
in the United States. Our demographics are changing as our
technology sector grows and our economy changes. We've got to
communicate that. We must have a responsive and flexible
education system. This needs to be the case at all levels:
kindergarten to grade 12, colleges and universities, and
continuing skills development. Ottawa must have an infrastructure
building program that strategically responds to and invests in
areas that will build our global competitiveness and maintain our
quality of life.
1340
Our story must be told, and
we're telling it. We need your help to tell it, and we need your
help to keep writing that story.
Ottawa is an example of the
returns that came from investment in the knowledge-based economy.
This did not happen overnight. It has happened since the 1960s
and 1970s. Denzil Doyle will tell you it happened in the 1960s
and 1970s. Our story is a tremendous source of pride and an
example of leadership and vision for Ontario. To drive forward
the prosperity of Ottawa and of Ontario, the province must commit
to investing in the growth of Ottawa. We cannot take Ottawa's
success for granted. Over the next year, the Ottawa Economic
Development Corp, on behalf of the business community, will
continue to work with the city and the province to make both
Ottawa and Ontario a leading economic force in the world.
I thank you for your time.
Mike Darch and I will be pleased to answer questions. We're ready
to speak to any of the matters we've raised, and we hope we can
clarify issues you might have in your minds.
The Chair:
Thank you very much. We have approximately five minutes per
caucus, and we'll start with Mr Christopherson.
Mr
Christopherson: Thank you for your very upbeat
presentation. You're obviously very proud of your city and your
community and of what you've achieved, and you should be.
As you know, it's not the
business of the provincial government to promote any one
community but to ensure there's a level playing field and to
provide the overall infrastructure for all our communities-I'm
from Hamilton.
I want to ask you-and
certainly, Richard, I don't mean to centre Ottawa out in doing
this; all of us have similar figures and similar situations. But I
can't recall ever hearing anybody say 88,000%, and I've been
sitting in on these kinds of hearings for quite some time. That's
a phenomenal number. It says a lot about your community, and I
tip my hat to you. However, that 88,000% increase-I believe it
was in venture capital investment-stands beside 23% of the
children in Ottawa who are in poverty.
I realize that's not your
responsibility, although I'm sure you care as an individual; it's
our responsibility at the senior level of government. Nonetheless
we've all got to be in there together. I'd like your thoughts on
how we can continue to see the one number grow, which is good,
and the other number diminish, which is bad. What's your sense of
that? How would you see your community approaching that and,
probably more importantly for purposes of these hearings, how
would you see the government of Ontario approaching both those
things, recognizing there are not the dollars to do
everything-and that includes tax cuts, I might
emphasize-especially in a downturn. This budget will be set in
the context of a tumbling economy-if not bottoming, at least
tumbling. So your thoughts on that, sir?
Mr
Henderson: I must speak from the perspective of our
community. I'll leave to your better judgment to interpret what
that means provincially.
We think growth fuels the
ability for us to create jobs in a community. One of the reasons
we create jobs for all spheres of society in this community, not
just the high-tech sector but the sectors that serve them, the
service sectors, is to continue our growth. Continuing our growth
also generates tax revenue for the provincial, federal and local
governments, and helps provide the funds needed for the other
public services you referenced in terms of helping those who need
help.
That's why we emphasize in
our presentation that there are three ingredients of future
growth. First, we've got to increase our talent. We've got to
make sure those young people coming out get jobs, so they have
the quality of life they would like to enjoy. Let's not forget
that. We're certainly actively engaged as a business community
with the education sector.
Second, we feel that
business infrastructure is key. You've probably heard the story
elsewhere, but we think the Ontario government's efforts over the
last several years have improved our competitiveness by improving
the fiscal climate. But now we've got to invest in our future
too. The business infrastructure, in our view, is very important
and may be one of the main areas we need to interact on.
Last, we need risk capital
and the entrepreneurial spirit. We think we're doing that. We're
OK there, but we ought to keep doing that. I can't say how we can
specifically address the constituency you talked about, but I
know that the way we can contribute to it is just to keep
growing, generating tax revenue and creating jobs.
Mr
Christopherson: If I can, though, my problem is, having
heard that at the starting line, which was 1995 when the
government made that argument, is one thing. But here we are into
our sixth year of that very argument and only side of the
equation is working. There are greater profits, greater
investment is going on, our competition relative to our
competitors is good. All those things are fine. But on the other
side of the equation, it's not working. The revenue, even if it's
being generated, is not going back into those areas of quality of
life, and all those indicators are falling.
I don't want to be
argumentative about it; I'm just trying to stimulate some debate.
But it seems that one side of the equation has worked very
well-you can't argue with that-at the expense of the other, and
it's getting worse. If we continue more of the same, aren't we
just going to continue to see an increase on one side and a
decrease on the other? We've got six years of evidence to tell us
how it works.
Mr
Henderson: Briefly in response, I appreciate your point
of view. We're going to speak from an economic development
perspective-
Mr
Christopherson: Absolutely.
Mr
Henderson: -and I'll leave you and your colleagues to
debate that provincially in terms of those public policy issues.
I know the way we can contribute to that is to keep growing. How
the benefits of that growth get shared, I think, is a public
policy question beyond our mandate.
Mr
Christopherson: Except that a lot of those things
require-
The Chair:
We've run out of time, Mr Christopherson.
Mr
Christopherson: Thanks very much. I know they're
difficult questions, and I appreciate your responses.
The Chair:
Go ahead, Mr Arnott.
Mr Arnott:
Congratulations on your success. There's a statement in last
year's budget that I'm reading now to refresh my memory. It seems
to me that we brought in favourable tax treatment for stock
options for high-tech companies. That has been very beneficial in
my riding of Waterloo-Wellington; I represent a big part of
Waterloo region. Just briefly, how has that worked here? Has it
helped? Do we need to do more of that? I'd like your response,
and then Mr O'Toole has a question.
Mr
Henderson: There's no doubt it's helped, as long as your
stock is going in the right direction. There are challenges with
that.
I think we've seen positive
responses from both the federal and provincial governments on
this issue in the last year. We're not sure how you place
priority on perhaps accelerating that or giving further
incentives. We haven't dealt with that issue extensively at OED,
in terms of whether more needs to be done in that area. We do
feel, and it seems to be a very strong consensus in our
community, that perhaps we've got to make sure, in the things
governments may do, that the business infrastructure issue may be
a bigger bottleneck that's emerging in terms of growth. We don't
think some of the softening in the economy is going to affect us
that much. Our sector is a little bit insulated in that. We really want
to make sure the business infrastructure issue is on the
agenda.
Mr
O'Toole: I also thank you for your presentation and
comment on our economic and fiscal management. I want you to know
that the Honourable Brian Coburn also recognizes Ottawa as the
high-tech capital of Ontario, certainly with some dispute
in-house from our member from Waterloo-Wellington.
The dilemma we're faced
with-and the way you described it, I might suggest, was very well
done-is how we convince the people of the conflict between
growing the economy so that you have the resources. That's a
longer-term view of how you deal not just with policy but with
the whole human capital versus working capital argument. I know
you've numbered a couple of strategic things like clustering and
academic infrastructure. But we hear-and just heard in the
previous presentation-of the human infrastructure piece and
having that quality of life you described as a pressing thing. On
one hand, it's gratuitous in the short term to deal with housing
issues and those things, and I know they're important. At the
same time, without a strong economy you cannot have the strong
quality of life issues, in our view.
In evidence to that, we had
10 years when, not in a political sense but for a lot of economic
reasons, the whole revenue side just fell apart, and naturally
all the other programs-not just the social contract-were in
peril. How do you deal with it? We're in a no different
situation. I suspect that competing conflict of things like
capital tax is a penalty in Ontario. Minister Eves and Minister
Flaherty have issued it. It makes you less competitive, and the
microsystems all move to your competitors because we're not
competitive in the global economy.
1350
I want you to understand
that we understand your dilemma, but the message for me
personally as an elected person in the riding of Durham is to say
that we're not ignorant of the human challenge. In fact, whether
it's the daycare issue, the homeless issue, the child poverty
issue-all those issues-it sounds like we don't care. In fact, I
think it's more difficult to make the commitments to build that
human and knowledge infrastructure so we have the economy that
we've become accustomed to. Have I got this right? I'm not just
asking you a question, but in the response is there something we
can do?
Mr Michael
Darch: From our perspective, Ottawa was very fortunate
from the point of view of having the federal government presence,
as well as the presence of major federal labs etc. As you
probably know, we have the highest-educated workforce in Canada.
There is little question that our success in the new economy can
be traced back to the success of our skilled labour force and the
depth and the maturity of our skilled labour force. We certainly
keep working hard to drive that forward.
The unfortunate thing is
that, unlike minerals in the ground and trees in the forest,
people can move. One of our biggest problems is maintaining that
human capital and keeping that human capital here. We believe our
success in nurturing our human capital and keeping it here is
generating tax revenue, which helps us deal with the other
issues. Our findings in our branding and marketing study, which
we're just completing, show that things like clusters of
companies and a skilled labour force are a sort of checklist that
if you don't have, people don't consider you.
Once you're into the big
leagues, and we believe-you'll notice on that map there are no
Canadian cities; we're competing heavily against US cities. If
you lose a job in Ottawa, it doesn't go to Toronto, it doesn't go
to Durham, it doesn't go to Waterloo; it goes to Raleigh, Atlanta
etc. The thing that gives us our critical difference when we
compete against them, when we meet the skilled labour requirement
etc, is quality of life.
The Chair:
Thank you very much.
Mr
Kwinter: I'd like to just follow up on that point. In
your presentation, you talked about doing a $70-billion
business-
Mr
Henderson: One seven, $17 billion.
Mr
Kwinter: It's one seven?
Mr
Henderson: Yes.
Mr
Kwinter: -and 90% of that is export. Where is the bulk
of that 90% going? The United States?
Mr
Henderson: By far the bulk. Mike, any specific figures
on exports?
Mr Darch:
I don't know the figures exactly, but by far the bulk goes into
the US.
Mr
Kwinter: Overall in Canada, that goes across all
industries; 90% of our exports go to the United States.
The point I'm trying to get
your reaction to-and when you're talking about the support you
need, when I was the minister, we had a trade office in Boston,
New York, Chicago, Atlanta, Dallas and Los Angeles. What they did
is, they would extol the virtues of what we had to sell in
Canada, as well as try to get investment from those
jurisdictions. We don't have any of those any more,
notwithstanding it's by far our biggest market, and yet we have
several US states that have offices here. They're out competing
against you in your marketplace and we're not really competing
against them in their marketplace, other than the business that
individual companies get. Do you have any feelings about
that?
Mr
Henderson: We haven't found a major obstacle in getting
our message of marketing on companies to the US so far. We've
grown, but we've got to go to the next level. We also think that
needs to be business led. That's one of the reasons companies in
our community have invested heavily in the branding and marketing
work we're doing. I'm sure trade offices would contribute to that
in part.
Where the business
community is expressing to us is the bigger obstacle to growth is
in not making sure we convey our message outside by making sure
we have a winning conditions message to convey. You can brand and
market all you want, but if you don't have a good story to tell,
the slogans and the catchwords will be exposed for what they are.
The way OED has looked at the world is to say you need concrete
winning conditions, those quality of life issues, the good
transportation, the good education, the good workforce, and you
need to have the substance and do the sizzle and the sell. We've
really focused on both points, making sure we do that and working
with you and other governments to make sure our winning
conditions respond to the demands we're facing.
The Chair:
Mr Patten.
Mr Patten:
I know your story well. I live here and I meet a lot of you and
your colleagues. It's quite a story. I'd like to see somebody do
some historical documentation of this, because some of the
people, going all the way back to the early 1960s and 1970s, can
tell quite a story.
I have two quick things. In
my opinion, frankly, it's important to market, of course, what we
have going here. I think that's something that is unique and
something people don't consider certainly in the technology
field, the diversity and depth of the full range of supportive
services around this, legal services and connections around the
world and this sort of thing, which have helped tremendously. The
other is the sort of critical mass of R&D. Even though it had
diminished for a while, I think it's grown somewhat now and
that's gone through. I would even say historically the role of
the provincial government in the early days of the innovation
fund was to help with some venture capital when none of the
private banks would provide very much. Some of your colleagues
have mentioned that to me.
But at the end of the day,
I don't think we're ever going to be able to compete with those
American cities on a tax basis. We can always try to stay within
striking distance, but I don't think we're ever going to do that.
To push that one to its ultimate conclusion, in my opinion, is
not going to work. It will come down to, I believe, quality of
life. In other words, at the end of the day, you say your number
one resource is going to be skilled labour.
The one example my
colleague Mr Christopherson mentioned before, and I would just
identify, is that the Irish experience is showing that when you
put out a clarion call to those who are unemployed, to those who
may have been disabled, to those who aren't skilled, to those who
need some training, to those who can't afford to go to school,
and say, "We need everybody in this economy to participate,"
they're having a fantastic, absolutely amazing response in the
sense of what's coming together in Ireland today. It's a
magnificent story. I would suggest maybe there are some learnings
for us in that particular area.
I'm also delighted that the
people in your area participate in some of the other social
areas: our school infrastructure, our road infrastructure, our
hospital infrastructure and this sort of thing. I look at us
broadening it out. While you say, "We're here just from the
economic point of view," knowing you as I know you, I know your
concept is really broader than that, would you not say?
Mr
Henderson: Just a short answer, Mr Patten, and then I
want to turn to Mike to comment about the US situation in terms
of our competitors. Certainly as a business community, we feel
the quality of life is key, the human resources are key and our
definition is broad. We feel we have leadership roles to play in
some of those areas of quality of life and supportive roles in
others. Most certainly the business community here is a very
active one, as you know. Like a lot of the communities that
others of you are from, it's got to be teamwork.
But the issue of the
comparison with the US is one we've got to keep in mind. Mike,
comments there?
Mr Darch:
My understanding is we have to get somewhere within 10% to 20%
striking range. If we can get to within that level, we start
becoming competitive and then it moves over to our quality of
life etc. The trouble with quality of life issues is, it's
difficult to define the quality of life. Given the shortage of
labour we have in Ottawa at the moment, the Irish experience of
turning every available body into the workforce would certainly
help.
Briefly responding to Mr
Kwinter's question about Ontario in the US, the only thing I
would mention on that is that location decisions and people
moving are very much related to a region these days as opposed to
provincial or Canada. Therefore, if you're looking to
assistance-places like Ottawa-we feel that assistance to Ottawa
going out and competing against the cities we compete against in
the US is much more useful than a broader Ontario comparison
which, by definition, has to address all areas of the country. We
wouldn't compete in certain areas of the economy, such as
automotive, steel etc, but we remain very competitive in the
clusters we've discussed.
The Chair:
I have to bring this to an end, as we've run out of time. On
behalf of the committee, thank you very much for your
presentation this afternoon.
A quick announcement before
we invite the next group. For the staff and the members, the
transportation to the airport will be leaving in front of the
hotel at 6 o'clock this evening.
1400
TASK FORCE ON POVERTY IN OTTAWA-CARLETON
The Chair:
Our next presentation is from People First: Ottawa Action on
Poverty. Could you please come forward and state your name for
the record. On behalf of the committee, welcome. You have 30
minutes for your presentation this afternoon.
Mr Cliff
Gazee: Good afternoon. It's a pleasure to have an
opportunity to share with this committee some of the wonderful
work we've been doing in our community, in the hope that it may
give some guidance as to how we can approach some of the major
problems facing not just this city but the province as well.
I'm Cliff Gazee. I
co-chaired the Task Force on Poverty here in Ottawa-Carleton and
I currently co-chair a steering committee which is preparing for
a permanent advisory committee on poverty to work with the local
municipal government. With me today are Candice Beale and Terrie Meehan. I'll first
ask Candice to make her presentation, followed by Terrie, and
then I'll try and do a wrap-up.
Ms Candice
Beale: Hi. I'm Candice Beale. I'm a former member of the
Task Force on Poverty, a current member of the interim committee
of the Ottawa Action on Poverty, chairman of the Poverty
Awareness Week committee, and I've conducted parenting and
poverty classes in the Centretown Community Health Centre.
The first thing I'd like to
speak about is subsidized daycare. One of the recommendations of
the Task Force on Poverty is that more space has to be made
available. Subsidized daycare is vital to many families all
across the province. Families with low incomes depend on being
able to access quality child care, care that is regulated by the
Day Nurseries Act, in order to maintain employment. Informal care
is what most of these families must rely on as it is all they can
afford. Since informal care is not regulated, people have come to
feel that they are gambling with their children's lives and
sacrificing the quality of their child's early education.
No one can be expected to
perform optimally at their job when concerns for their children
such as the ones I've mentioned are pressing on their minds.
Thousands of these families qualify for subsidized child care.
However, there are simply no spaces available. In fact, no new
spaces have been created for far too long.
Subsidized child care is
jointly funded between the province and the city. The region of
Ottawa-Carleton did its part. They set aside the money to cover
their share of the cost of these spaces long ago, but they could
go no further without the approval of and funding from the
province. It is now long past time the province of Ontario
stepped up and did its share. Parents are desperate for more
subsidized spaces, and the province can no longer afford to deny
parents these crucial spaces. Access to daycare, quality daycare,
directly impacts the workforce. If the province wants to keep
Ontarians working, then it needs to make that possible by
providing its share of the funding for these subsidized child
care spaces.
The other thing I would
like to speak about is the social assistance rates. In 1995 the
amount of money that people on social assistance received was cut
by 21%. This hurt recipients far more than the province realized.
However, since the cut took place, the cost of living in Ontario
has risen dramatically, yet the amount given to people to cover
these costs has not. The numbers used by the province to
calculate how much money a person needs to survive on are no
longer valid.
The price of food has risen
dramatically and the bargains we were told to look for no longer
exist, thus making it impossible to provide adequate nutritious
food for our families. This lack of proper food compromises the
health of recipients, which will eventually lead to higher health
care costs for the province, meaning that failing to provide
sufficient money to those on social assistance provides no
monetary savings in the long run.
The same holds true for
shelter. With a less than 1% vacancy rate in Ottawa, affordable
housing is almost non-existent. Landlords know that people are
almost desperate for any housing, so they can charge whatever
rent they want and someone will pay it, putting most housing out
of the financial reach of social assistance recipients. A
staggering number of recipients have found themselves living in
shelters. It costs far more to house a family in a shelter than
it costs to simply provide an adequate shelter allowance, thus
allowing families to remain in far more cost-effective private
residences; not to mention it's easier to find a job, go to
school or volunteer when you have a home.
In addition, the cost of
maintaining that home has risen drastically. Heating costs having
risen so much that the federal government felt it had to step in.
However, the help they provided was just a drop in the bucket
when a whole year of expenses is considered. These are but a few
examples.
The cost of living has
risen dramatically across the board; social assistance rates have
not. People, families especially, can no longer adequately cover
their basic needs given what they currently receive. A
cost-of-living adjustment must be made and the amount those on
social assistance receive must be increased accordingly.
Ms Terrie
Meehan: Hi. I'm a bit nervous and I have a speech
problem, so please bear with me.
I'm also talking on child
poverty and housing; I believe they're related. If you can't
afford basic needs for your child because you're paying for
inadequate housing, then basically your child is going to grow up
and the cycle is going to continue.
I'm a single parent of
three. I'm disabled. I'm also a volunteer at CERA who weekly sees
hundreds of people being evicted for not being able to afford
their housing. I'm a volunteer at National Capital Freenet;
that's how I can afford to go look out on the world. I'm also a
volunteer at Home Safe where we're seeing the people who can't
afford their housing. We're seeing a drastic increase, especially
with the layoffs from the companies that are downsizing, and
we're looking to see some support from the province-or I'm
looking to see some support from the province for the people who
just can't afford to go anywhere else.
I've sort of screwed up my
speech, so I'll hand it off to Cliff.
Mr Gazee:
Just to go back to give a little context of who we are as a group
and what we've been involved in over the past couple of years,
back in October, November 1998, there were five sets of hearings
held across the region of Ottawa-Carleton bringing together
people living in poverty to share their situations and how they
were coping with cutbacks that they had to face and a more
difficult climate. The intent of those hearings was for people to
identify problems and to propose solutions so that we can look at
how we can remove some of the barriers that are preventing people
from participating fully in the life and the economy of this
province.
We developed a set of
recommendations which went to council and which highlighted
particular areas of concern, whether it be child care, housing,
transportation, the
cost of utilities, educational opportunities. There were about 10
areas. The final area in our recommendations was the need to
create a task force to address some of the issues that we had
identified and come up with some creative solutions to the
problems that we had discovered in our community.
We presented our final
report in February 2000, and the city council, or the regional
council at that point, accepted part of that report, the idea
that they would create a permanent advisory body that would bring
people living in poverty to work with local government and local
officials to look at all of those areas where the system is not
working the way it should and where basically nobody is getting
the best bang for their buck.
I would say the work of the
task force has contributed significantly to the reduced caseload
that's been tossed around in the media as of late, which brings
to mind the impact of the current dispute over transitional costs
and how they will affect the local economy. I can say
unequivocally that, yes, we may not get new buildings, may not
get new infrastructure, but the bottom line is that those people
at the bottom of the economic spectrum will suffer more than
they've been suffering in the past unless this situation is
resolved. I think it's time for both the city and the province to
back off a little bit and it's time to come up with a reasonable
solution that will meet everybody's needs so that we don't create
greater economic problems in our community.
1410
Among the areas in our
final report that we felt needed to be addressed, not just at the
local level but at the provincial level-and in fact some of them
at the federal level-is the need to increase the basic rates to
ensure that everybody can have an adequate diet, that everybody
has adequate housing and that all basic utilities are covered.
There is a need to infuse some new money to ensure that people
have money for hydro and telephone etc. I think one of the
strange things for me is that we're living in a society now where
I've got kids who are going to school, young people walking
around with cellphones, pagers, and then there are people in our
community who have problems: their child gets sick in the middle
of the night and they're running down the street looking for a
quarter to go to a payphone to phone for an emergency. I think
that's the equivalent of having outdoor plumbing in a society as
modern as our own.
It's an issue that must be
addressed because as long as people cannot communicate, they
cannot get phone calls to say they're being offered a job or a
training opportunity, they're cut out of the loop. We need to
ensure that everybody is in the loop so that, at some point
somewhere down the road, they can become active, employed people
and can, in fact, become contributors to the tax base as opposed
to a drain on it. I think that's very much what most people
living in poverty would rather be doing than being-how would you
say?-the pariahs of society.
Transportation is another
very important issue. Our city now stretches from east to west
192 km, I believe, and all of our industries are diversified all
over this area. If we want people to be able to participate in
that economy, to take jobs and to become self-sufficient, we have
to ensure that people can get from point A to point B. I've
noticed that at one point there used to be provided bus passes
for everybody and that at another point down the line, when that
was cut out, all of the second-hand stores, like Neighbourhood
Services and Salvation Army, didn't seem to have enough clientele
to maintain their resources, and they're supposed to be there to
serve the poor. But the fact is-and I've experienced it
myself-that if you've got to go find a pair of boots for your
kid, and you've got to jump on a bus that's going to cost you $3
there, and back and you get there and you can't find what you
need, then you've wasted that money. So a lot of people stopped
using those services.
Working on the
transportation subcommittee, I have done some research on
jurisdictions in the States, and transportation-the people who
are barred from participating because of a lack of
transportation-represented the highest single barrier to people
on social assistance being able to access jobs or training. That
figure was somewhere in the range of 47% or 48% of a barrier. In
contrast, people who were identified as having drug or alcohol
addictions in fact only represented about 2% of the population
who considered that problem a barrier. So it may be time to
redirect our energies in terms of where are the barriers and how
can we remove the most significant barriers and place a little
less emphasis on barriers which are minuscule in their
import.
Child care is extremely
important because for single parents particularly to leave their
homes and go off to work they have to be assured that their
children are going to be safe and that they'll be well cared for.
With the growing economy in our community, there is lots of
opportunity for night work and for shift work and there is no
flexible child care for evenings and nights. For those people who
can, for example, do child care in their home, the only people
who can access that are people with disabilities. At this point,
people need to be able to leave their children at home. They
can't be uprooting their children and putting them in a daycare
and picking them up at 6 or 7 o'clock in the morning when they
get off work. That's not a viable option. So there is the need
for changes in that system so that home daycare and subsidized
home daycare will be available to people who need it.
Education is another big
area. A lot of people have difficulty accessing the education
system. There is difficulty acquiring enough money in order to
become part of the education system. There is a need that
benefits be allowed for people who are studying, at least for
their first post-secondary degree. This is an opportunity to move
people up and along and off the system. As well, a student loan
should not be considered as income for determining eligibility.
This puts the student at an unfair disadvantage compared to other
students and it puts the possibility of failure much higher for
that individual. The other area in education is the need to
reinstate subsidies for special-needs children.
Affordable housing is a
major, major problem in this community, as was alluded to. As
long as our vacancy rate is somewhere at 0.2%, which is a
ridiculous amount, and we have people flooding into the city for
high-tech jobs who are living in hotels and God knows where, and
who can afford to come along and bump up the rates-I've heard
stories where an apartment would be available and somebody in
that category of a new employee would come in and say, "I'll
offer you X amount more than you're asking for that apartment,"
and automatically those people who are on lower incomes are being
forced out of the housing market. The end result of that is
greater degrees of homelessness. I know that problem of
homelessness is like apple pie and motherhood, but the reality is
that it's a very real problem. There are people dying in
increased numbers on the streets here in Ottawa. I know it's
happening in Toronto and in other jurisdictions across the
province, as well as other cities across Canada, because first of
all the feds bailed out and then the province bailed out and now
the issue of affordable housing has been dumped down on to the
area that may be least able to afford it.
Those homeless who are
dying on the streets of our city are actually telling us
something. They play a very valuable role. You may remember that
a long time ago when coal miners were going down into the shaft,
they always had canaries that they would put down there to see
how toxic it was, and if the canary started to die, they knew
there was something wrong and they wouldn't send their crews down
into the mine. Those homeless who are dying on our streets are
the canaries of our society who are in fact telling us there is
something toxically wrong in our society that needs to be
addressed. Those people who were born in Canada or came to Canada
with great hope of how they could contribute have been given the
shaft in more ways than one.
I think one of the problems
we see in the debates that have gone on is the polarization
between left and right or one side and the other, and my
observation about people's beliefs and what they think is right
is that everybody actually has a kernel of truth. There is nobody
who is entirely wrong. Some people have a bushel of truth and
some people have a little bit of truth, but I think the biggest
mistake comes when somebody assumes that the pile of kernels of
truth they've got in their hand represents all the truth there is
to have and that their opponents have no truth whatsoever. I
think it's important that we see what truths are coming out of
the mouths of the people who, on the surface, we may not
necessarily agree with.
The analogy in my mind is
that it's like a bird and the poor are the hungry belly of the
bird. What we often are seeing in our society-and the poor are
powerless to influence this process-is that the left wing of the
bird is trying to decide it's the wing to fly this bird, the
right wing is doing the same thing, and in the meantime there is
no harmony. We as a community and as a society must realize that
to get that bird off the ground we have to be working in harmony
and that it's a symbiotic process. We are mutually dependent.
Whether it be labour and management, whether it be rich and poor,
we all have a role to play that balances each other off to make
our lives as a community more successful, more profitable, with
fewer people marginalized, fewer people dying on our streets, and
so that more people have an opportunity to contribute to the
greatness of this country.
At this point, I could
entertain any questions, if there are any.
1420
The Chair:
Thank you very much. We have approximately two minutes per
caucus, and we have to make it tight. I'll start with the
government side.
Mr Galt:
Thank you for your presentation, and congratulations on the task
force on poverty that you've worked on. I hope I can leave a
little time for you to explain to me your definition of poverty
and what level that comes to.
I just want to explain a
few things about what we've been doing and give you some
background. The big thrust of our government has been to create
jobs. We're up to almost a million jobs, something like 844,000
net new jobs. A lot of people who were on welfare now have
permanent jobs. Some have immigrated-come back to our country.
But sometimes it doesn't matter how much you give, there's always
more to be asked for. Certainly a previous Premier of this
province, Bob Rae, said that many times. Sometimes it's difficult
to know just what level to plug in.
Right now, according to the
National Council on Welfare, we are 34.7% above the average for
our welfare payments in Ontario. That's significantly higher than
other provinces. Does that make us right? Not necessarily, but I
just want to bring that out in comparison.
A couple of programs:
there's Healthy Babies, Healthy Children that we're putting
something like $67 million into annually, the Better Beginnings,
Better Futures program, some $772 million being put into welfare
services for children's aid societies to do more for children,
just to name a few of the programs we're involved in.
I'd like to save a bit of
time for you to explain to me, especially with your task force,
where you draw the line as to poverty. I've lived in a Third
World country and travelled in others, and I've seen phenomenal
poverty. I wonder how you define poverty in Ontario.
Mr Gazee:
I've travelled in Third World countries also, and I've seen the
most desperate levels of poverty, levels of poverty I haven't
seen here. However, I think one of the problems is that poverty
becomes a psychological phenomenon for people. When my kid goes
from a community school where everybody is at the same
socio-economic level to a high school where everybody is running
around with cell phones, and they drive in, in their cars and
have the best-labelled clothing, those children eventually start
to feel, "This is not where I belong."
The disparities are how
poverty is mentioned. It's when people are denied what's going on
around them and they're left out of the loop. That's how I
define poverty. I know there's a lot of debate about low-income
cut-off points, and I'm not even prepared to go there. I've seen
poverty in these communities, I've seen suffering and I've seen
people die on the streets. You mentioned the CAS. There are many
parents who feel they just can no longer cope. In my own
community, people have had to give up their children to CAS
because they can no longer afford them. I would say that's
poverty. It doesn't compare with what I saw in Guatemala or
Nicaragua, but yes, there's poverty. I don't think it does us any
good to make comparisons against other countries, because we are
Canadians. We're living in an environment that looks like this
and doesn't resemble the streets of Guatemala.
The Chair:
The official opposition. Mr Patten.
Mr Patten:
Thank you, Cliff, Terrie and Candice, for coming today. I know of
your task force. I've participated in some of the consultations,
and I commend you for your stick-to-it-iveness for the more than
months and weeks-the years-you've spent addressing the people who
are not quite as fortunate in our community. Your task force will
now become a permanent task force.
I ask you whether you've
dug into this as a general question. You can see the debate: we
say the government is not doing enough, and the government says,
"We've got this, we've got Better Beginnings, we've got this
program, we've got that program." They've thrown out about 25
different little pieces of programs that in and of themselves are
not bad programs. It seems to me that part of the problem is that
at any juncture where there is an opportunity to get ahead,
whether it's a single mother who is trying to go to university
but needs to get some daycare subsidy and can't get it and
therefore can't go-that's where the government, it seems to me,
pushes and tries to squeeze and resist what they call "abuse." In
the bargain, though, in my opinion, it discourages people and it
actually blocks people from getting where they want to be and
where I think the government would want them to be.
I'd like your candid
reactions to that. I'm not suggesting just throwing everything
wide open. All I'm saying is that there are a number of blocks in
the system that are there because the government keeps
obsessively talking about this welfare abuse that, in my opinion,
does not exist. It certainly doesn't exist as it might in other
sectors. If it does exist, it's very, very small and very, very
minor. Would you have a comment on that?
Mr Gazee:
Yes, I agree that there are lots of good programs that are being
put in place, but I think the problem is where the programs don't
exist, where there are barriers that are not being addressed,
that keep that single mother from acquiring the education that
moves them on down the line to become a more contributing person.
Those things have to be looked at, and they have to be looked at
dispassionately and without looking at, "What's the ulterior
motive here?" I think we're caught up too much in motives and
who's right and who's wrong, when the reality just needs to be
fixed. I believe Candice wanted to add something on that as
well.
Ms Beale:
I just wanted to make a quick comment about the government's
claim of programs. The percentage of people who actually access
these programs or even have use for these programs-better,
healthy babies: fine, if you have a baby. If you have a teenager,
that program is useless to you. I think if you checked, you would
find that the number of people who are actually accessing these
programs is a lot smaller than the government would like you to
believe. Frankly, we would all be better off if you would stop
inventing programs for us, ask us what we really need and perhaps
just give us the money on our welfare cheques so that we can
actually buy groceries. Because a better babies program is a
wonderful thing, but if you can't eat your breakfast before you
go to this program, the program really doesn't do what it needs
to do.
Mr
Christopherson: A very sobering report; thank you for
taking the time. One observation and one short question.
Observation: you mentioned
the bus pass program. It came to my mind immediately that back in
the 1980s, when I was on Hamilton city council, we had a discount
to the bus pass program to help the unemployed. It was expensive
but it provided them with the transportation and all the obvious
things that I don't need to tell you. It was interesting: the
sort of, I'll call them the right-wing group, for lack of a
better label, decided that this had to go. They made all the
arguments about all the things that could be done with that
money, much like those who come in and say, "If we paid off the
debt, we'd have all kinds of money that we wouldn't be spending
servicing the debt to do this and this and this and this." But
what's interesting is the reality was that once the program was
gutted-because they got enough votes to do it; they killed the
program-they voted en bloc against every initiative to then spend
that money elsewhere as they had argued would be the ideal
situation, since it was just this program they didn't like, not
the idea that it would go there. I think it's something for all
of us to keep in the back of our minds when we hear folks talking
about what percentage of our expenditures is going to service the
debt. They say, "Eliminate the debt; there's all this money."
Oftentimes, if they still control it at that time, it doesn't go
to all the things they said; it goes into things that benefit
those who already are doing quite well, thank you.
I want to ask one question:
at the end of the day your goal, obviously, is to move the
government, to get something done. I'd like to say to you that if
we could tap into the hearts of everybody, that would be enough
to do it. But my experience in public life tells me that's not
the case. It takes more than that. I'm talking about the public
now, reaching the public. Self-interest is human nature. Have you
got any evidence that shows that the growing numbers of people in
poverty are clearly-they are, but have you got the evidence that
shows that there are middle-class or middle-income families that
are sliding, and that for those who aren't in poverty, you have
reason, even if it's just self-interest, to care about this? Can
you just give us a little of your experience on that?
Mr Gazee: I'm a case in point,
possibly; we could put it that way. I was well employed with CBC
Radio until the program that I was working on was cancelled.
Subsequent to that my wife was killed and I was left with a
two-year-old daughter and a nine-year-old son at that point.
Anyway, all of a sudden I found myself in a situation where
although I was doing quite well at one point, it was a slide. It
was a continual slide to try and keep up with things, and I found
myself eventually standing in a line of a food bank, looking for
services at the local community health centre, getting involved
in things like that. I know that I'm not the only one.
1430
There's a saying within the
community that almost everybody is just one or two paycheques
away from the food bank. The turnaround can be so fast and we can
see it. We've got so many people being laid off. At one point,
all of a sudden there's a big hiring binge here in Ottawa; the
next thing you know, you've got people out on the streets.
There's no security for anyone at any level of the stratosphere
and for people involved in this fight, it's not generational
poverty in all cases; it's cases of situations where people have
slipped or pushed or eventually slid into a situation of poverty.
That's a loss. Those are human resources that are being lost to
the overall economy of this community. "Economy" comes from the
word "ecology" and they're all related, and we're all part of the
environment. We can contribute or else we can be just scattered
and wasted on the rocks as so much human garbage.
The Chair:
With that, I'll have to bring this to an end because we've run
out of time. On behalf of the committee, thank you very much for
your presentation this afternoon.
Mr Gazee:
Thank you for the opportunity. It's been a pleasure.
CANADIAN CHEMICAL PRODUCERS' ASSOCIATION
The Chair:
Our next presentation this afternoon is from the Canadian
Chemical Producers' Association, so I would ask the presenter to
come forward and state your name for the record. On behalf of the
committee, welcome, and you have 30 minutes for your presentation
this afternoon.
Mr Richard
Paton: My name is Richard Paton. I'm the president of
the Canadian Chemical Producers' Association, and I have with me
a number of representatives of our association and various
companies. To my left here is Mike Hyde with Dow Chemical;
further to my left is Dave Podruzny who's with the association in
the economics role; and our regional director for Ontario, Norm
Huebel.
Thank you very much for the
opportunity to speak with you today. The subject I'll be talking
about is quite different from the last subject you heard, so I
must say you must have a tremendous range of types of
presentations. If you'll permit me, I'll go into the more
industrial part of this fine province. I'm going to talk a little
bit about the nature of our industry and its importance to
Ontario, and then I'm going to focus on the three most
significant issues that we would like to address in this budget.
I'll probably speak for about half the amount of time that we
have allocated and we'd be happy to hear questions.
You have a presentation in
front of you with this little chart. The reason we use that chart
is to give a bit of any idea of how our chemical industry fits
into the province of Ontario. We call our industry a keystone
industry because you can see how it relates to the resource base
of the province, such as forestry, wood, paper, agriculture,
mining, metals, also the petroleum industry, natural gas
industry.
The chemical industry is
largely focused on the chemistry process of transforming products
from a resource base to consumer products for Canadians, such as
plastics, rubber, food and beverages, the cars you drive, many of
the products that are in your homes and many of the construction
materials that we use such as insulation in houses etc. That's
the nature of our industry and it's a critical industry to any
industrial economy.
If you look at our
industry, we're the third-largest manufacturing industry in the
province. We have around $7.5 billion to $8 billion in sales in
the province. Our industry employs about 45,000 people if you
include the more general chemical industry. Our industry is very
productive. There has been a lot of talk about productivity, a
concern that maybe Canada is not quite as productive as the
United States. We've done an independent study with Industry
Canada on this and we found that we're one third more productive
than the United States. In fact, we're the highest, most
productive of all the G8 countries.
Notwithstanding that
productivity and the importance of the chemical industry to the
economy, we feel we're still not getting our share of investment
in this province. There's about $40 billion of investment, North
America-wide, in the chemical industry going on at any given
time, and we feel that, given our productivity level and our
access to a huge, 120-million-person market within a one-day
trucking drive to those markets, we should be getting about 10%
of that investment, or about $4 billion a year as a country, or
about half of that for Ontario, which would be around $2
billion.
But we're not getting that
kind of investment for all kinds of reasons. I know the chairman
has been involved in some of the issues related to those reasons,
and we feel that Ontario could be much better positioned if we
got a number of issues dealt with that would help us increase
that investment.
Mr Patten:
Can I just ask you a question? What's your level of investment
now?
Mr Paton:
That's a good question. It's probably around $200 million or $300
million a year.
Mr Dave
Podruzny: The total in the sector was almost $1 billion
last year in all investments-that included repair-in Ontario, but
it's still well under what we would have projected as a target,
which is $2 billion.
Mr Paton: We're at about 50%
and we'd like to be at 100%.
Mr
Podruzny: Our sector, the industrial chemical side of
that, is about $650 million.
Mr Paton:
With your packages you have this scorecard. This is the third
time I've been in front of your committee and I've noticed that
every time I come, the scorecard is well appreciated because it's
one of those nice documents where you can quickly understand
what's going on, see the pluses and the minuses and the neutrals.
I'm not going to discuss the scorecard in detail, but you'll
notice the way it's set up it shows you where we are in a plus
position vis-à-vis other jurisdictions that we compete
against for investment, where we're in a neutral position and
where we're in a negative position.
We tend to be in a negative
position in areas such as access to feedstock. The critical mass
of our manufacturing industry, if you compare, say, Sarnia to
Houston, for example, it's quite a difference in critical mass.
Energy costs are increasingly becoming an issue; construction
costs have also been an issue and remain an issue.
In past presentations we've
focused on areas such as construction costs, electricity
deregulation and other areas. Today I'm going to focus largely on
three issues that all relate to the question of investment, which
is our number one priority. These three issues are the Ontario
retail sales tax, cost recovery and tax competitiveness.
Why are we talking to you
about the Ontario retail sales tax? I assume that sales tax is
always a problem for just about everybody, but why is it a
problem for us in the chemical industry? It's kind of a unique
problem. Until last year, CCPA member companies and their
contractors had thought it was clear that reinforced concrete,
which is integral to the production process in construction, was
exempt from the Ontario retail sales tax. However, recent
reassessments of projects by the Ministry of Finance auditors
have subjected this reinforced concrete to the sales tax. The
reassessments are significant. They add up to 0.5% to the capital
cost of chemical industry projects. Most of our projects are in
the $200-million, $300-million, $500-million range. So if you
start adding 0.5%, that doesn't sound like much to a $10 bill,
but if you add it to $300 million, it can be a lot of money, or a
portion of that project, because that is the portion that would
be reinforced concrete. That small amount adds significant enough
costs to actually start making projects less competitive when
compared to other locations.
As a result of that
problem, CCPA and a Sarnia construction association which
represents contracts in the Sarnia area are asking the standing
committee to confirm that reinforced concrete, which is integral
to production, is indeed exempt from the ORST. We've been advised
by the Ministry of Finance staff that this confirmation must be
provided in the provincial budget. The staff cannot provide that
confirmation themselves; they can, however, explain to the
standing committee exactly what is required in order to provide
that confirmation. Once the confirmation has been made, CCPA and
the SCA can work with ministry staff to see that the appropriate
categories of reinforced concrete are correctly incorporated into
the auditor's guidelines.
1440
We've been working with the
ministry staff to develop the costs and benefits associated with
providing that confirmation. Again, that information is available
from the ministry staff. I guess we're requesting you to look at
this issue and, in the budget or your recommendations to the
Minister of Finance, signal the intention of this government to
make the changes to the regulation and guides that would indicate
that reinforced concrete, which is integral to manufacturing and
equipment, is ORST-exempt.
In this case, there might
be some question of, is this going to be a loss of government
revenue? Because the reinforced concrete is normally part of new
construction, and if investments are not made or able to be made
in the province, then in fact there will be no revenue from sales
tax. So it's not a win-lose situation; it can be a win-win
situation.
The second issue is cost
recovery. When governments get short of resources, and we've seen
that at the federal level, there's a big tendency for departments
to search out new ways to replenish that revenue, and the end
result is often for departments to seek out cost-recovery
opportunities. This has been the tendency in the Ontario
government. Some people would argue this is a tax under another
name, a hidden tax or another way to approach taxation. Some
would argue that it's right because there's a private benefit
involved and the private sector should be paying for that private
benefit. We have been working with the Ministry of Finance,
Management Board and others to put in place principles and
criteria and an implementation procedure which would ensure that
cost-recovery initiatives are developed and implemented fairly.
So we're not opposed to cost recovery per se, but we definitely
have a lot of difficulty with cost recovery that doesn't seem to
be linked to either a service or an improvement or even very
clearly to a public-private benefit issue.
We recommend that an ad hoc
working team of industry and government be established to
accomplish this, and we would appreciate the support of the
standing committee on this issue.
I should just note, as an
aside, that I've been involved at the federal level in this
issue. There is a cost-recovery coalition of about 15
associations working on reviewing the cost-recovery policies of
the federal government. The parliamentary committee on finance
has done a complete report on cost recovery at the federal level,
criticizing it very heavily for its inappropriate implementation.
So this kind of issue can easily snowball and get out of hand and
cause governments a lot of difficulties. It's definitely in
everyone's interest to get good, clear policies upfront and then
to provide the guidance as necessary for departments to work on
cost recovery.
The final issue I want to
raise is improvements in tax competitiveness. The Ontario
government is to be congratulated on the corporate tax reductions
announced in its 2000
budget. This was a significant move to achieve corporate tax
advantage. As quickly as fiscally prudent, we urge Ontario to
accelerate its announced reductions to the corporate income tax.
When fully implemented, it will open up a clear advantage with
our competition in other jurisdictions. This will make a
difference and provide key and necessary ammunition to retain
existing facilities and to win new investments.
We also believe that it
will be useful if the Ontario government opens up a dialogue with
the federal government to consider the future elimination of what
we call profit-insensitive capital taxes. CCPA recognizes a
limited scope for further tax reductions in the short term,
certainly in the uncertain economy that we're facing now, but we
urge both levels of government to revisit this form of corporate
taxation. Any substantial reduction or elimination of this fixed
tax will be bound to support investment in the newest and best
technologies.
The reason we're focusing
on capital tax is that you'll hear many ministers, especially
ministers in the federal government, talk about how important
productivity is, how we need to be better at innovation, how we
need to make more investments in capital, and yet when you start
looking at how we reward investment and how we penalize
investment, in fact it's the opposite signal that we give to the
private sector. I think, Dave, you may want to talk about that
sometime, but if you're building a chemical plant in the United
States, you're writing it off in five years. If you're building
it in Canada, you're writing it off in 10 years. If you start
looking at an investment of $300 million and then you say, "Gee,
I wonder why the investment's not coming to Canada," it's pretty
simple. It's just a little bit of math, and you can figure it out
pretty fast. So while the country keeps talking about
productivity and investment and innovation, it's also taxing the
very capital that drives innovation, investment and productivity.
At some point in time, both provinces and federal governments
have to deal with this issue.
In summary, we in the
chemical industry are engaged in the serious business of working
to win investments for Ontario. As you all know, we are a global
industry, probably one of the most global industries in the
world. We compete for investments with other key jurisdictions,
especially the Texas, Louisiana and Gulf Coast areas. We have
many advantages as a province, as you can see from the scorecard,
but there are some areas that still stand in the way and limit
our ability to attract investment. If we addressed some of these
issues, we'd definitely be in a lot better position to be able to
win investments, which means winning jobs, which means investing
in communities, and which means better revenues for the Ontario
government. Everybody's going to win.
The
Vice-Chair: Thank you very much for your presentation.
We have about two and a half minutes per caucus, and we'll start
with the official opposition.
Mr
Kwinter: I was interested to see your comments about how
we are no longer competitive in the electricity field. At one
time that was one of our strongest incentives for attracting
industry to Ontario, particularly those who were heavily
dependent on electricity. I assume in your industry that is a
major consideration. Do you have any thoughts about what is
happening at the current time with the proposed restructuring of
the electricity sector?
Mr Paton:
Yes, it's a big subject for us, but I'm going to ask either Dave
or Mike to talk about that. They're much more knowledgeable about
that than me.
Mr
Podruzny: The scorecard that you have in front of you is
going to be adjusted immediately following the next budget. One
of the points that I think will come up is that the electricity
rates in Ontario, which have not moved for a number of years,
where rates have moved in other jurisdictions, are rapidly going
to be moving to the point where they are competitive.
One of the concerns we have
in the whole process of deregulation, and I guess it's where we
appreciate that the move is going slowly and carefully, is that
the deregulation process needs to afford competitive options and
that there need to be, in a deregulated environment, choices for
the public and for industry. A deregulation process that only
moves from a provincial monopoly perhaps to a private monopoly is
not deregulating. We would want to see a sufficient number of
competing entities that you have competition.
So our concern about rates
has to do with moving to the kind of deregulated industry that
you see, whether it's in telecommunications or trucking and so
on. The rates, as they stand right now in Ontario, are
competitive with the immediate region around. The lowest rate
would be in Quebec. The second-lowest rate would be in Ontario.
When you head west, Manitoba is lower. The main competition,
though, for southern Ontario is going to be with the immediate
northern-tier states, where the rates are competitive. Where we
said in here that the rates were non-competitive, it was because
as early as a year ago there were a large number of neighbouring
states where the rates have now gone up.
The
Vice-Chair: We'll move on to the third party.
Mr
Christopherson: Thank you, gentlemen, for your
presentation.
I do want to talk about the
revenue on the sales tax, simply because there are tax moves you
want to make that do pay off in the long run, and there are
others where you're being lobbied because people are smart enough
to lobby you for their best interests. Do you have a dollar
figure? Do you have a sense of that? What is that?
1450
Mr Mike
Hyde: Yes, we do. We worked very closely with the
Ministry of Finance to try to determine what the revenue impact
would be. We know very well our own sector and we were able to
determine that, but we added on top of that five other industry
sectors that may in fact have concrete used in the same way we
do. The revenue impact was estimated at somewhere between $12.5
million and $18.5 million per year. Offsetting that, of course,
is the personal income tax, if new jobs are created, and
corporate tax, of course, with new investments and new
manufacturing facilities, too. We're still trying to figure
out what that offset
would be, how big that would be. It's a little bit harder to get
our arms around that figure.
Mr
Christopherson: I can appreciate that. To be fair,
everybody makes that argument, whether it's spend this on
education and you'll save money, or spend this on preventive
health care. Everybody makes that argument, and if you just did
it across the board on the corporate side, what would make sense
is just to eliminate all corporate taxes entirely and then we'd
have more money than we can count. It's not that straightforward;
very little is.
But I was wondering what
other industries this impacted on, and are you the leading user
of reinforced concrete and, if so, why? Why the chemical
business?
Mr
Podruzny: I'll see if I can tackle that. We probably are
the leading user. We're not asking that all reinforced concrete
be made sales tax exempt; we're only asking for that portion of
reinforced concrete which we have believed for some considerable
time is integral to the manufacturing process. That might be a
special concrete support for a high-velocity engine or a reactor
vessel, where the concrete support is necessary for the operation
to actually proceed.
There are a few other
industries where there is a similar-perhaps it's a concrete
support, perhaps it's a concrete waste treatment facility. The
industries that we have identified that have some but, we
believe, less concrete component in the four or five categories
that we've identified are the petroleum refining sector, pulp and
paper manufacturing-and both of those have some similarities to
our industry-and then, to a lesser degree, as you moved down
you'd have the non-metallic mineral manufacturing, primary metal
manufacturing and, finally, metal fabricating. Those sectors have
some components where the reinforced concrete is integral.
The other point we would
make is that the products we are talking about, if we make them
off-site and pull them on-site and then put them together with
our equipment, are retail sales tax exempt, but if we fabricate
them on-site or if we have the contractor come in and put them
together on-site, the tax is charged.
The
Vice-Chair: Thank you very much. We'll have to move
on.
Mr
O'Toole: Thank you very much for an important
perspective on building our provincial infrastructure. I just
want to acknowledge a couple of discussions. Mr Christopherson
earlier, and others, have been sort of trying to map out the
conflict of building the capital infrastructure to create wealth.
That's been the debate basically from the beginning. In fact, the
TD chief economist, Don Drummond, who was here before-and I was
quite impressed-talked about real growth and nominal growth, but
the most important thing he talked about was the growth in
productivity. You've talked about the capital drivers, which are
really the innovative investment decisions that create capital.
There's some risk with that. So I just want a response. We've had
some input on the capital tax side, both federal and
provincial.
Looking at this whole thing
from a productivity perspective, and it's sort of covered in your
tax competitiveness issue, number 3,. I suspect that I'm of the
side that believes without a strong economy, you can't deal with
the other social issues very properly, whether it's daycare or
homelessness or a lot of other issues. No one here is opposed to
that. It's just our approach to solving it is different than it
was for 10 years. We're trying to put together the
infrastructure, and your industry, the chemical industry, is
extremely critical, I know, to our Chair, Mr
Beaubien, down in his area.
Just map out a little bit
more what we could do on the capital tax side, not just the
retail sales tax side. That's just a one-off, and it sounds like
it's solvable from what I hear you saying, but perhaps on the
broader capital side. We've created the innovative research and
development challenge fund and the strategic skills investment
fund. We've looked at the corporate tax rate being halved; I
believe they set it out as being over eight years, and we're
trying to do it in less. We've given investment incentives for
research and technology. But on a practical business case
comparison with you and your neighbours in Texas, I think you
need to look at the whole box of revenue demands. What could we
do to get the best value for Ontario?
The
Vice-Chair: Mr O'Toole, you've used most of your time,
but I'll give you 20 seconds.
Mr Paton:
Great, 20 seconds. We talk fast.
I think you're absolutely
right. We're comparing all these things to other jurisdictions.
Very simply, if you take a look at the total corporate tax load
on our sector, it was around 40%, right, Dave? Then it was cut a
little bit by your reductions in the Ontario level.
We've done an analysis of
what corporate tax levels probably would be required to
significantly attract investment. We feel at the federal level,
it should go from about 21% to 17%, and if the reductions are
made as quickly-I don't know what the time frame is in Ontario,
but if it moved down quickly, we'd end up with 17% plus 8% or
something, so it would be around 25%. At 25%, we would open up an
advantage vis-à-vis the US, and we need that advantage to
offset the fact that we don't have huge complexes like Houston,
we're not close to the market, we're not close to the
headquarters, we're not close to where the R&D is usually
done.
That would be a short
answer, plus address the capital write-off provisions.
The
Vice-Chair: On behalf of the committee, thank you very
much for your presentation. Most informative.
OTTAWA-CARLETON ASSEMBLY OF SCHOOL COUNCILS
The
Vice-Chair: We'll move on to our next delegation, the
Ottawa-Carleton Assembly of School Councils, if they would come
forward at this time. On behalf of the committee, welcome. To
begin your presentation, just state your name and those of your
associates for the record. You have a half-hour in grand total
for a presentation and questions divided equally between the
three caucuses.
Ms Cynthia Pohran: My name is
Cynthia Pohran, and I am the chair of the Ottawa-Carleton
Assembly of School Councils.
Mr John
Dingwall: I'm John Dingwall, and I'm on the executive of
the Ottawa-Carleton Assembly of School Councils.
Mr Greg
Laws: I'm Greg Laws, also a member of OCASC, as a
liaison officer.
Ms Pohran:
I'd like to start by thanking the committee for giving us the
opportunity to address you and to present our concerns. I'm
really pleased that you are soliciting public input to the
provincial budget through this process, and I found it very
interesting to listen to your presenters. You've had a long day
and I just really appreciate your attention at this time to hear
what we have to say.
Of course, it will sound
like we're giving a very local perspective, but I think that when
we describe the issues that we are concerned with, you will find
that they're not a local phenomenon and they are actually
pervading the education system throughout Ontario.
One of the things I heard
through previous presenters was about the quality of life. It may
sound like we're coming from conflicting perspectives, but I
think that depends on our vantage point. One of the things I
realized, too, is that the province has diverse responsibilities
and you're striving to meet the public interest. These things we
all very much appreciate.
One thing that we do think,
though, is that Ontario's budget should not promote a society
where a small percentage of the rich would get richer and the
poor might get poorer. What we're going to deal with here is how
public education becomes the great equalizer for our citizens in
Ontario right across the province, the fact that it would be
accessible to all and that, once in the education system, every
child has an equal opportunity to experience personal success
through their educational experiences.
Another issue that I've
heard expressed-a common thread through all the presentations-is
that people are the key to our social infrastructure, that
school, if it's not child care, is the first experience outside
of the family, and that school should be a safe place, and it
should meet a diversity of the needs of all students. These
issues we will also address in our presentation.
1500
Our message to you as a
province would be to invest in education. A child typically
spends 15 years in the education system. These 15 years shape and
mould our future leaders of our society. They shape and mould and
provide the skill sets. Every one of the presenters who were
presenting on the technological or the business side were saying
they need skilled work people in their workforces.
So these are the issues
that we're going to address. We did give you a written
presentation. We're not going to read it verbatim; we're going to
try to touch on the key issues, and then we do hope that you'll
read some of the filler in your spare time, if you have that.
The Ottawa-Carleton
Assembly of School Councils is an umbrella organization for the
150 school councils that serve approximately 80,000-plus students
within the Ottawa-Carleton District School Board. You heard this
morning from the chair of the OCDSB, Jim Libbey, about the issues
facing our board. We are in complete agreement with all of those
issues.
We are a non-partisan
organization. We represent a broad cross-section of the
population. Our motto is "Working together for excellence in
education." We do this within our school councils as individual
members in local schools. We do this in the assembly as school
councils working together. We do try to partner with the Ministry
of Education. It doesn't matter what stripe that ministry is
wearing at any time: our first interest is the students. They are
our children. School councils are made up of a majority of
parents. We want to see the students put first in any type of
ministry directive.
The general picture is that
English public education in Ottawa-Carleton is suffering from the
impact of continuous funding cutbacks. Our students are paying
the price now but our community will pay the ultimate price
later.
From 1998 to this present
time, the OCDSB budget will have been cut by close to 20%. In
theory, the cuts are supposed to come from central administration
and education tax dollars are to be focused in the classroom. The
reality is that central administration accounts for only
approximately 2.8% of the total budget. That amounts to
approximately $14.4 million on a $403.7-million budget. We're
using the 1999-2000 figures; those are the ones that we actually
had record of. Therefore, most of the reductions have come
straight out of the classroom. I think that's important for you
to know.
What is our message? The
current funding formula handicaps our board with regard to
providing quality education to our students. It is time for the
province to reassess an increase in funding for Ontario's
students.
Before the funding system
was centralized by Bill 160, school boards had the local
authority to raise taxes and to allocate these dollars to
directly benefit our students. This ability to invest in local
education allowed our board to take into account the specific
needs and priorities of the Ottawa-Carleton region. You heard
some of those needs expressed earlier this morning by the OCDSB
chair. The application of the revised provincial funding formula
has resulted in lessening the quality of our region's education.
Our school board is left with no flexibility and is constrained
to the provincial average. That was a message I heard from a
previous presenter: that we must have a responsive and flexible
education system. We couldn't agree more, and that is one thing
that the current funding formula does do: it restricts
flexibility.
The funding cutbacks that
we have experienced so far are only the tip of the iceberg. The
mitigation or transitional funding is now expiring and our
students will soon be feeling the full force of the cutbacks.
This will have a tremendous impact on students all across the
region. Many who are currently disenfranchised with the
declining quality of
English public education are seeking alternatives. Those who can
afford it look for options outside the public education system.
If this phenomenon continues, it will result in a two-tiered
education system with unequal opportunities.
Access to quality education
should not be based upon one's ability to pay. Education of our
children is a basic tenet of a democratic society, and the cost
should be borne by all members of society. Those who choose to or
must remain in the public education system face a situation that
just keeps getting worse. As we see each of our children going
through the system, we also see declining quality of education,
mounting pressures and diminished choices which are the result of
a funding formula based on government budgetary decisions and not
on sound pedagogical principles and practices. Any potential
positive results from educational reforms are being lost because
they have been introduced without proper timelines or adequate
financial support. OCASC has gone on record previously to say
that we applaud many of the government's education reforms. The
new provincial curriculum is a wonderful document, but without
the necessary funding to support that curriculum, we're losing
those positive results.
The consequences of
cutbacks in the school system will be felt not only in the
political system but also in the economy of Ottawa. Since Ottawa
makes a vitally important contribution to the provincial economy,
this impact will affect the Ontario economy as well.
Your budgetary decision
will be, "Do we pay a bit more now or a lot more later?" I think
that might become evident as we highlight the specific areas
where we are seeing the most stringent constraints in our budget
area. We'll be talking about special education, we'll be talking
about English as a second language, and the frustration that
students are feeling with having restricted courses and not
having the textbooks to actually meet the curriculum
requirements.
All in all, parents and
school councils are seriously concerned about the current and
prospective state of education in Ottawa-Carleton. We see the
system getting worse despite all our fundraising and volunteer
efforts. The whole concept of public education is that all
taxpayers invest in quality education for each citizen,
regardless of his or her socio-economic status or particular set
of abilities.
School councils and parents
of school-aged children have traditionally augmented the
educational experience with their participation and/or
fundraising efforts. Today, school councils and parents are faced
with the dilemma of raising money to provide basic curriculum
resources. This should not be the case.
From the government we hear
about the importance of learning in the knowledge-based economy;
we hear about the importance of innovation and investment; and we
hear about the need to be competitive in a global economy. We
agree with the government on all these points, and we believe
that in order to achieve these goals you need to make the
necessary investments to ensure that we have a strong education
system, now and in the future.
In looking at some of the
specific areas-we've outlined them in our brief-we'll touch upon
special education first.
Special education provides
help to those students with exceptional needs, including children
with developmental disabilities, learning difficulties and
behaviour problems. When children in need are identified, they
should get the help they need. This provision of appropriate
programs and services increases their chance for success and
their ability to become productive, contributing members of
society. Without the necessary funds for assessments and
appropriate programs, we fear that our children will not reach
their full potential, and they may drop out or go through the
system without acquiring the knowledge and skills they need. In
essence, if we're investing in post-secondary school education
but we're not giving the children the resources they need to get
through secondary school, we are not solving the problem.
Ottawa-Carleton has
traditionally been a leader in special education, with
approximately 12% of our students currently identified as
exceptional students. Special education currently accounts for
about 20% of the total instruction budget. Meeting local needs
for special education costs our board $10 million more than the
formula provides. The strong programs that we have had are now
being weakened or dismantled.
Our board has been forced
to reduce the number of paraprofessionals and educational
assistants who support regular classroom teachers. Many of these
personnel are the very same people who should be conducting the
early-identification tests that enable exceptional students to be
assessed and funded by the government through ISA
grants-intensive support allocation. Many of our congregated
classes that once provided exceptional students with the
appropriate services they needed have been dismantled, forcing
integration into a regular classroom that does not have an
adequate number of teaching assistants to help the teacher manage
classroom behaviour. Consequently, all students are being
affected and their educational needs are not being met.
The solution is not, in our
opinion, to dismantle the programs that Ottawa has built up, but
rather to increase the support for special education across the
province. Such a decision would recognize that special education
is an investment that will pay off as students in these programs
become adults who can make important contributions as employees
and citizens.
English as a second
language: for most jobs in Ontario, competence in English-not
just a basic knowledge of English-is essential. If we want
immigrants to be employed at their full potential, then Ontario's
public schools should be providing the required ESL instruction
to school-aged children. This can only yield substantial benefits
over the longer term by providing a larger educated labour force
and fewer socially assisted persons.
Unfortunately, ESL funding
is currently available only for the first three years from the
time of entry into Canada, and it is not available at all for
children born in Canada. These rules do not address the reality
of the home
environment for immigrants, many of whose children do not enter
the school system with the necessary knowledge of English.
Our statistics here would
say that over 8,500 students in the OCDSB need ESL instruction.
The current statistics are now 9,700, and we're only meeting the
needs of approximately 30% of those students. That is just to
give you an idea of how much we're falling short of meeting the
needs of these students in our system.
I'm going to let John
continue with secondary schools.
1510
Mr
Dingwall: The secondary school system is absolutely
fundamental to prepare young people for post-secondary school or
career choices. Those who lack secondary school diplomas will be
facing limited prospects. We need to ensure that we have the
financial resources to respond to the diverse needs of our
students and to ensure their success.
What's happened here is, we
have the shift to the four-year program and, at the same time,
we've had a reduction in the funding that's available. That means
there are fewer slots in the curriculum for students to choose.
You're getting declining enrolments in some courses and we have a
very limited ability to carry courses with smaller enrolments.
Consequently, a lot of courses are being cancelled and the range
of options is being reduced.
We find the cancellations
occur in areas such as senior-level courses in the social
sciences, drama, visual arts and music, physical education and
health, and international languages. It's really depressing to
actually go to a school council meeting and have the principal
tell you the courses that are being cancelled are the courses you
were counting on that you wanted your kids to take.
At the same time, with the
shift to the new curriculum, we have a distinction now between
applied and academic courses, but this distinction, which
actually makes a lot of sense in many respects, is not working
too well because we don't have the ability to carry the requisite
number of courses, and students have difficulty finding
mathematics and science courses that match what they specifically
require. There are a lot of problems there with math and science
as well.
In the bilingual area,
we're having difficulty putting those programs together because
we can't fund the senior social science courses the students used
to have. So that's harder as well.
We've also found that
there's limited chance to actually innovate in the system. For
example, we would like to put studies in international
baccalaureate programs in various schools, but we've been very
preoccupied with school closures. All of our innovation's been
put on hold for the last couple of years, and that will continue
to be the case. What we're finding is less innovation, less
choice and just less opportunity in the secondary school
system.
At the same time, we did
some research, for example, looking at American schools in
Minneapolis and places like that, California, Arizona etc. What
we found was that their schools are maintaining the programs in
exactly the areas we're cutting back. These are the places where
people are going down to for high-tech jobs, and they're making
comparisons between Ottawa and these other possible locations
that they could go to.
So far, our education
system has actually been a selling point. People have these
discussions. They look at the various elements of the package,
they look at taxes, they look at quality of life, they look at
bike paths and parks, you name it, and they look at education.
Education has been strong up until now, but as we implement these
20% reductions, we're finding that the whole quality of the
system is going down. We've got less and less choice, and this is
going to be less and less of a selling point as time goes on.
It's what we would call an emerging issue. If you look at the
actual comparisons, you find they're really maintaining these
programs in the States, like international languages, athletics,
sports, drama, music etc. I looked at those Web sites and
actually started getting a bit depressed.
Ms Pohran:
A further concern relates to the current impact of Bill 74. When
the Legislative Assembly held its hearings on Bill 74, OCASC came
forward and expressed its concern that this bill would reduce the
number of teachers in each school, thereby increasing safety
risks to students, and also that the quality of education would
be reduced because remedial help was not classified as part of
instructional time for teachers, and we were very concerned about
our students who needed that remedial help. That need doesn't
just disappear at grade 8; it continues on through high
school.
The legislation has
increased teacher workloads, while reducing flexibility in
scheduling. That impacts our students. Some students are seeing a
changeover in teachers halfway through the year and, again, less
of an ability to offer a wide range of courses to fulfill the
needs of each student. Not every student is geared to major in
computer technology and go out into that area. What we have also
seen is a drastic reduction in applied technology in the trades.
Even our intermediate schools are not able to introduce that type
of course to a student, and so we have a reduction in people
going through the system who are pursuing the trades.
Also, the net result has
been less teacher time available for students outside the
classroom, less time for individualized assistance,
extracurricular activities and in-school supervision. We're also
saying that Bill 74 needs to be reviewed, reassessed and revised,
and though that may not sound like a part of the pre-budget
consultation, in essence it is, because basically we're saying
that although the funding formula is restrictive, it just can't
be reorganized within the existing amount of money you've put
into the Ministry of Education. There needs to be more money put
into that area so that all of these issues can be addressed.
For elementary schools, we
see it as a starting point of a child's education, a foundation
upon which the rest of his or her educational experience is
built. Across our whole system and across the province, we see
problems stemming from
funding shortages, and that includes shortage of textbooks. As
we've said, the new curriculum has been introduced from
kindergarten right up to grade 10 now, but when boards budgeted
for putting textbooks in the classroom, it wasn't for that many
grades and that many classrooms all at once and so boards are
left with a shortage of funds. We know there has been grant money
given, but it's not sufficient. We know of schools that have an
immediate need for, let's say, $45,000 of French curriculum
textbooks; otherwise, their teachers are spending time
translating English documents into French just so that they can
teach the curriculum to the students.
We've lost vice-principals.
The funding formula only allows a principal for what is
considered to be an average-sized school, but most of that school
size is slightly larger than a lot of our schools and that means
our board has to make up the shortfall there.
Our libraries are suffering
in that we cannot staff them with teacher-librarians. Library
technicians have been put in place because we can put those
people in place for a lower salary. A lot of our libraries are
closed to our students for a good portion of a day. They may only
have a library technician for half a day, and yet you'd think the
library would be the hub of a school. This is another real
situation that we think needs to be addressed.
There are things like the
reduction of availability of specialized instruction in
technology and the arts, inadequate playground equipment and the
fact that our transportation is causing our children to go on
double or triple busing at very early times. You've heard the
concerns about waking children up so they catch buses at 6
o'clock in the morning, and that's happening for school-aged
children too.
I know our time is coming
down to 10 minutes. We have points on capital investment, the
impacts on our community and the impacts on the economy. We also
have recommended solutions in our brief, as well as an executive
summary on our cover page.
What I might say in
closing, because I'd like to leave time for the members to engage
in some questions, is that no matter what industry you hope to
support, I'd like you to keep in mind that Ontario's students are
your clients who must be served by the province in order to
provide the skilled labour force that would enter those business
places and workforce. Thank you.
The Chair:
We have approximately three minutes per caucus, and I'll start
with Mr Christopherson.
Mr
Christopherson: Thank you for your presentation. You
hear enough presentations from enough communities about where we
are with the education system and it just leaves you dry as to
where you go to try to find another angle to make the point. I
can only hope the government's listening, because virtually every
community in this province is facing the same thing. I heard in
Thunder Bay exactly what my trustees tell me in Hamilton, in my
hometown, that we're hearing here, that we hear in Toronto, and I
have no doubt we'll hear tomorrow in London also.
Let me ask you this. In
Ottawa specifically, if the trend isn't changed during the term
of this government, which could run another three years or the
better part of three years, where are you going to be? If you
want to take it out further, where are you within a half decade
and a decade? Where does this kind of short-sighted funding
deficit ultimately lead us?
1520
Ms Pohran:
It's hard to predict the future, and I won't claim that I have
the ability to do so, but certainly, if our students continue to
slip through the cracks, we do think there'll be a negative
impact on society: frustrated adolescents. We see a rise in
violence in school locations; outside of school as well, in our
society. Especially for the special education students, I know
the government has committed to providing standards within the
next three years; we're aware of that. But there is certainly a
need until those standards-and we welcome them-are addressed.
Funding must be provided so that the supports can be in place,
because integrating special education students into the regular
classroom without appropriate supports is affecting every student
in every classroom across Ontario. I would just say that we have
to recognize that young people can be frustrated. It may be
increased dropout rates with the introduction of Bill 81 and the
code of conduct and the strict discipline schools. We have
concerns over all those issues and we really don't know where
it's going, but we're concerned.
Mr
O'Toole: Thank you very much for your presentation. I
think you listened to presentations today from all the different
sectors. I hope you get an overview of the tough choices of the
human dilemma.
Ms Pohran:
We do.
Mr
O'Toole: Where does the money come from, really? From
the government? Well, they don't have any money. I'm not trying
to be smart, but it's that simple. We redistribute the
wealth.
My daughter is a high
school teacher; my wife is a teacher. I have five kids. I was a
trustee for a couple of terms. I don't disagree with anything
you're saying, but there are some choices. You can't be all
things to all people. I would agree with investing in the
classroom-totally, absolutely. I would today commit with a
resolution that we would put more money in the classroom.
Some 85% or 90% of the
budget is wages and benefits. You saw the board's presentation.
The top three items were all salary and benefit issues. Not to
say that good people shouldn't be well paid, but my point is, how
do we build in the investment in accountability so that it's in
the classroom?
Just earlier today the
Ottawa-Carleton Child Poverty Action Group-I'm going to quote
from Lynn Sherwood about the new learning opportunities grant for
children at risk: "To the best of our knowledge, these grants
have been rolled into the general revenue of the Ottawa Board of
Education for teachers' salaries." That's in her presentation. We
have evidence that there's been money taken out of textbooks for
teachers' salaries. The Ottawa board got a 4% raise. Where did
they get the money? The increase in their budget-by the way, it
did increase in real dollars. Where did they get the money? From
books.
Ms Pohran: I would like to
address that. The first thing I'd like to address about that is
the fact that the government is not providing sufficient money to
the boards to pay their teachers and other employees based on
contractual obligations. The percentage that you're talking
about-we follow the budget process quite closely. We know that it
is the first increase the teachers have had since 1991-92, and 4%
for teachers, in our opinion, is a better investment in the
classroom.
Those teachers are in the
classroom. The quote from Lynn Sherwood-I don't have the
statistics, but I would hesitate to agree with it. I've been at
the budget presentations and have seen the accounting of the
grants. If you want to offset the number of retirements and the
number of resignations that are happening in the teaching field,
I think you have to at least offer some kind of competitive
salary. The Ottawa-Carleton District School Board's salary for
teachers is not at the top end of the provincial average, but I
do say that the government should be providing at least the
average for the salaries and benefits to the boards of education,
or they should take courage and enter into the contractual
obligations themselves, because the boards do not have any more
resources as far as raising the money to negotiate, and yet
they're at the board with the federations.
The Chair:
Thank you very much, Mr O'Toole. We've run out of time. Mr
Patten.
Mr Patten:
That's a heck of a litany of identified areas that are wanting.
When you put it all together, it says-and by the way, to my
colleagues on the committee today, these are parents who work
incredible hours, better than half time in some instances, in
trying to contribute to better education in the community.
The cutbacks that have been
taken out of education leave a base, all the responsibility and
all the control centralized at Queen's Park, but you've got the
problem of trying to sort it out with no decision-making. You've
got to renegotiate contracts but you're given a certain guideline
for salaries, and you know you can't even satisfy the salary
guidelines so you've got to get that money from somewhere else.
It's an absolutely stupid situation that you have to live with,
we all have to live with and, as you suggest, you're going to pay
for this.
I'd like you to identify
the growth in the private schools that is going on in this
particular community-and I think I know some of the answers but
you may have more definitive information than I do-directly as a
result of the frustration of people saying, "I am sick and tired
of seeing my kids getting kicked around. We're trying to raise
money for textbooks; we're trying to raise money for basic
programs in this thing. We can't get a resolution between the
government and our teachers for after school. To hell with it,
I'm taking my kids out," with one kid or another. And then
they're still contributing their time voluntarily to try and help
the situation, in your situation. What is happening related to
the growth of private schools in this area?
Ms Pohran:
I don't know if I have any statistics on that. I've been so
immersed in trying to work in the public education system, and
that's where our three children are. As Mr Patten has pointed
out, we're all parents here and committing voluntary hours as per
school councils-that's exactly what we do.
I do know anecdotally of
people who have moved their children into the private schools.
They can't afford it. Parents of children with special needs have
been especially frustrated with the lack of supports. I know of
parents within the public education system who have made transfer
into schools not based on program decision but because it's safer
at this school than at that school over there. We know of parents
who have chosen to home-school their children because they can't
afford any other option. We know of parents who are moving into
the Catholic board, and I know that board is funded by public
taxpayer money too.
I guess what I'm trying to
say here is that's not the point, because if we ever got to a
two-tiered system where the government moved to charter schools
and gave people their money as vouchers to go and shop where they
wanted, we are concerned that no one will want those
special-needs kids. Which school would want those kids to bring
down their graduate statistics? We have a real fear that would be
the way we'd go.
We're appealing to the
government to look at public education and the budget that
they're putting into the Ministry of Education based on those
facts and other things that we've brought to the table.
The Chair:
Thank you very much for your presentation this afternoon.
ALEX CULLEN
The Chair:
Our next presentation is from the city of Ottawa. I would ask the
presenter to come forward and state his name for the record. On
behalf of the committee, welcome, and you have 30 minutes for
your presentation this afternoon.
Mr Alex
Cullen: I would like to thank the standing committee on
finance and economic affairs for giving me this opportunity to
address you during your pre-budget consultations. My name is Alex
Cullen, member of Ottawa city council and chair of the Ottawa
Housing Corp for the city of Ottawa. I'm glad to see some
familiar faces around the table here.
I'm here to speak to you
about the challenges facing the new city of Ottawa-the costs of
our amalgamation, the demands for new infrastructure, our housing
crisis, and the need to refurbish our hospitals-and to plead with
you to reinvest the province's burgeoning surplus, now running at
$1.4 billion, into needed public services, not more tax cuts.
As you are aware, our new
city has been newly created from the amalgamation of 11
municipalities and regional government into a city of over
800,000 people. The promise that was made to us by the Minister
of Municipal Affairs and Housing at the time was that this would
improve service levels and provide savings for property
taxpayers. While all agree that there are savings to be made from
amalgamation-$86 million is what the transition board has
identified-not all of this can be returned to the taxpayers. As
you will see from the table before you, the budget pressures upon
the city of Ottawa amount to $57 million. Take out Ottawa Hydro;
you end up with what's available to the city, some $22.5
million.
1530
However, what had appeared
to us to be some $22.5 million in savings at the end of the third
year that could either be returned to the taxpayer or reinvested
into much-needed public infrastructure-and I should mention that
the transition board had identified $145 million in additional
infrastructure requirements above and beyond the city's annual
$300-million capital budget-all this has now evaporated with the
government of Ontario's inordinate $94.5-million bill for the
costs of amalgamation.
This was not only
unexpected, as we had assurance from the transition board that
the Minister of Municipal Affairs and Housing had agreed to at
least a 75% provincial share, still leaving a $47-million bill
for Ottawa taxpayers, but it means either Ottawa taxpayers see a
13% tax increase, confounding the promises made by this
government in initiating amalgamation, or a corresponding cut in
services, again confounding those promises, or a reduction in our
capital infrastructure program by nearly one third, which would
be counterproductive to all parties concerned. Clearly, this is a
problem that would be in the interests of all parties to resolve,
not by rhetoric, if we are to sustain the growth experienced in
this, the second-largest city in Ontario.
The government of Ontario
has certainly benefited from this growth; it has not only saved
$100 million as a result of lower welfare costs-and I should
mention the city of Ottawa's costs have actually increased by $4
million due to provincial downloading of the costs of family and
new-resident cases; no savings here-but has benefited from the
increase in provincial revenues in sales, corporate and income
taxes. In the last two years tax revenue generated in this
community increased by more than $250 million annually. All
together Ottawa contributes more than $2.5 billion a year to the
provincial treasury. We have contributed to the province's
$1.4-billion surplus. It is time to see that reinvested back into
the community.
As you may be aware, Ottawa
has been experiencing tremendous growth over the past few years,
particularly in our high-tech sector. The high-tech sector has
recently become the city's largest employer, exceeding now the
government sector, a clear indication of the tremendous growth we
have seen here in Silicon Valley North. However, with this growth
in employment and wealth-creation comes the need to provide
infrastructure-roads, sewers, public transit, housing etc-to
sustain this growth. The alternatives are traffic congestion,
inadequate services, unaffordable housing that will choke off
growth.
The transition board, in
developing the budget for the new city of Ottawa, had identified
over $145 million in additional projects, beyond the $335-million
capital program for 2001 they have placed before city council.
These are not nice-to-haves; these have been identified by your
transition board as necessary to sustain the growth that the city
has already experienced, let alone meet the needs of
tomorrow.
If we are to sustain this
job-creating, wealth-creating growth that benefits families,
business and governments alike, then we must make the necessary
investments to sustain it. It is clear, as the transition board
has indicated, that new funding sources must be found. This is
where the investment in public services is needed, and now.
One of the issues facing
our community is the lack of affordable housing. Since 1995, when
this provincial government cancelled its funding for new socially
assisted housing, no new rent-geared-to-income housing has been
built in the city of Ottawa. Yet our waiting list for this
housing has doubled over the interim to over 15,000 households
today.
Further, the promise of
private sector investment-and I heard it at the Legislature-in
affordable housing has failed to materialize. The elimination of
rent controls through the passage of the so-called Tenant
Protection Act did not lead, as the government promised, to the
building of affordable housing in our community. Today we have
over 72,000 households here in Ottawa paying more than 30% of
their gross income on shelter, in a community that has only
22,000 units of socially assisted housing. Our vacancy rates are
less than 1%, 0.2% to be precise, and rents are skyrocketing.
This means that these families have less for their children, less
for their health and less for their future than before. This is
clearly unsustainable.
The province has downloaded
the costs of maintaining our current level of social housing on
to municipal taxpayers, at a cost of some $59 million a year.
While we can manage the current portfolio, property taxpayers are
in no position to build and support new socially assisted
housing. It is up to senior levels of government-who, through
their downloading on to municipal taxpayers, are reaping the
benefits through budgetary surpluses-to contribute their share
toward dealing with this acute housing crisis. Band-aid solutions
are not enough. It is a real crisis.
Does it make sense to pay
$4,000 a month to support a family of four in our shelters? But
that is what we're doing today. The cost of a rent supplement for
socially assisted housing is now less than $200 a month in our
city, if only we could get some built. This is another example of
where investment in public services is needed, not more tax
cuts.
Lastly, I want to talk to
you about our hospitals. I've provided you a chart that shows the
renovation costs for hospitals as a result of the Health Services
Restructuring Commission. As members of this committee know, the
government of Ontario in 1995 established its Health Services
Restructuring Commission to review Ontario's hospital system in
order to improve efficiency and save taxpayers money. In Ottawa,
the Health Services Restructuring Commission closed our Grace and
Riverside hospitals, amalgamated our Civic and General hospitals
and closed beds elsewhere in Ottawa. Included in its 1997 orders
were instructions as to how its decisions were to be implemented,
including the necessity of capital renovations to improve
hospital services. This has led to the now $598 million required
to implement the Health Services Restructuring Commission's
decisions, what is now arguably the largest capital project in
Ottawa in recent memory. However, the expectation that the local
community must provide $232 million toward these needed
renovations is both unrealistic and unfair.
Our community raises about
$110 million a year in charitable donations. The United Way is
responsible for some $18 million of this. It would be devastating
to community programs funded through charitable contributions if
an additional $23 million or so had to be raised each year for 10
years for our hospitals. Our community can't absorb that kind of
fundraising burden. Further, the municipality has tremendous
needs simply dealing with the costs of amalgamation-remember that
$94.5-million bill?-and the demands for infrastructure growth,
before even contributing to what is clearly a provincial
responsibility.
It would take a 3% increase
in property taxes to fund this amount, and that is simply not on.
The amount being demanded is inordinate, unprecedented in scope
and beyond the ability of property taxpayers to pay. And why
should we? These costs are the result of a provincial initiative
designed to save the government of Ontario money. Well
congratulations: you have a $1.4-billion surplus. Further, it's
the government of Ontario that has the legal, moral and political
responsibility to fund health care and our hospitals. It's in
Canada's Constitution. It's your job. Do it.
What the government should
be doing is reinvesting taxpayers' dollars into needed public
services-infrastructure like roads, transit, schools,
hospitals-not in more tax cuts. This is where the need is, and
that, in my view, is what taxpayers want. I urge you to bring
this message back to the Minister of Finance and to the
government of Ontario. That is what the province's budget should
be focusing on; that should be its priority.
The Chair:
Thank you very much. I'll start with the government side. We have
approximately five minutes per caucus.
Mrs
Molinari: Thank you very much for your presentation. I
feel a need to clarify some of the initiatives that we as a
provincial government have taken. The provincial government has
recognized the importance of Ottawa-area municipalities through a
number of actions.
First, I think it's
important to point out to everyone involved how provincial
actions have benefited the taxpayers in Ottawa over the last few
years. The region of Ottawa-Carleton received an $18.5-million
grant for their transit capital in 1998. This represents over one
quarter of the total $70 million provided province-wide. Also, in
1998 the region received a transit grant of a further $25 million
in recognition of Ottawa's unique capital needs for a rapid
transit system. Between 1998 and 2000, the region received over
$7.5 million in highway funding grants. Between 1995 and 1999, as
part of the Canada-Ontario infrastructure works program, the
province provided $45 million to the Ottawa area as its
contribution for local initiatives. Under the local services
realignment exercise, the municipalities in Ottawa received over
$218 million in annual new revenues to cover off the
municipalities' new service responsibilities.
1540
To assist municipalities in
their new responsibilities under the local services realignment,
the province provided the community reinvestment fund. To date,
Ottawa municipalities have received over $14 million in CRF
payments. Ottawa municipalities also benefited from transitional
assistance money for LSR, in 1998 and 1999, of almost $3
million.
The government has
committed to reducing the cost of education on the property tax
bill. To date, business property taxpayers have seen a reduction
of over $650,000 and residential taxpayers have seen a reduction
of $17 million. When fully implemented, the education tax cuts
will benefit business ratepayers by over $1.5 million each year
and residential ratepayers by $34 million each year.
Secondly, the provincial
government has made a commitment to assist the new city in
amalgamating its operations so it can recognize savings and
efficiencies to the benefit of local taxpayers. The transition
board has identified almost $90 million in annual savings due to
amalgamation. This will allow the new city to respond to local
priority initiatives as well as provide tax savings to ratepayers
at the same time.
To assist the new
municipality in its reorganization to recognize these savings,
the province has committed over $108 million this year to fund
these activities. This transition money works out to $360 per
household to cover those one-time transition costs, one of the
highest per household amounts in similar restructuring
initiatives. I think it's safe to say this is certainly a fair
deal for Ottawa ratepayers and council.
I am confident that the
city is also currently preparing to initiate its plan to realize
the savings identified by the transition board. The hard work
undertaken by the transition board produced a number of
recommendations on how the taxpayers would benefit in a new
amalgamated environment. The report of the transition board has
provided a road map for the new city council on how to achieve
these savings. I and other members of the government continue to
encourage the new council not only to adopt these recommendations
but to find even further ways it can deliver quality services at
the best possible cost.
When I think of some of the
immediate things the city can do, the pending decisions on what
to do with surplus municipal assets comes to mind. Through the
sale of surplus assets, the city not only benefits from reduced
operating costs by no longer having to operate these facilities,
but also reduces its debt load by removing these liabilities from
its balance sheet. Just as importantly, when the city sells off surplus land
and buildings, these properties become taxable and represent new
revenue to the city each and every year.
Finding these benefits and
savings for taxpayers must be driven by strong leadership and
political courage. I, along with my colleagues, continue to urge
Ottawa city council to embrace these challenges and deliver to
Ottawa taxpayers what they deserve; that is, the best possible
municipal services at the best possible cost. Taxpayers anywhere
in the province deserve nothing less.
Mr Cullen:
Thank you for that rather patronizing statement.
I was on city council from
1991 to 1997. We went through the downloading the province
inflicted upon us, the shell game of taking money off property
taxes for education and dumping extra social services on to our
tax base. Removing funding for transit from property taxpayers,
taking funding for highways off property taxpayers-the list you
give doesn't even come close to compensating the cost that the
provincial government inflicted on the property taxpayer in the
city of Ottawa.
I can give you chapter and
verse; the cost of downloading has been well documented by our
own staff. It was not revenue-neutral; that was the promise. It
cost us, and it cost us in services we had to provide.
It's interesting that you
talk about selling off land. We have a housing crisis. There is
no point selling off land we might be able to use in
public-private partnerships or find funding from senior levels of
government if we have to buy it back at higher prices. Yes, we
will sell off lands that are surplus to us. We've been doing it
for years and we don't have to be told to do it again. But it's
not going to be able to pay for this bill.
The bottom line is we have
new needs as a result of the amalgamation bill that no one was
controlling: your creature, the province's creature, to create
this transition board, and no one was minding the shop when they
went over budget on consultants, over budget on a whole raft of
things, and we're being faced with 50% of the bill. Who was
minding the shop for the most expensive per-capita transition
board in Ontario? That's ridiculous.
Mr Patten:
I'll give you a little more time, Alex. You've heard the
continuation of communications by press release, by statement,
one thing or another. I still don't know whether the council or
the mayor has received any personal communications in terms of,
"Let's sit down and talk about some of the issues, all right?"
The transition board was a creature of the province; no
parameters were given. It would seem to me to be prudent that if
someone sets up a management mechanism called a transition board,
they might say, "Here are some of your parameters. Don't go
beyond this. If you do identify these as options, that would be
in the hands of council to reconsider or to make decisions
upon."
So the relationship is not
good these days. I hope it will be, with the new minister of
municipalities. I'll be happy to see Mr Claude Bennett come back
and see what he has to say. He had said it was 75%; he was
convinced. I don't believe he would say that out of the blue. I
think our representatives here were not able to carry the day
back at cabinet, and that's part of the problem. They were told
that they would not have to carry the day on 75%. Anyway, that's
another issue.
The fact remains that a
very paternalistic government came in and devastated education,
devastated health care: "This is what's best for you." In each
area, you had education councils, you had the health-
Mr Cullen:
Health services restructuring council?
Mr Patten:
No, not that; the local health council.
Mr
O'Toole: The district health council?
Mr Patten:
The district health council, as we called it at the time. It did
a tremendous amount of work, identified areas and said, "Don't go
this way." They go that way, they take over $100 million out of
health and education, then come back and say, "Now go back to the
community and raise this amount of money," with a formula that
was less participatory in terms of contributions by the
provincial government. And we wonder why we have that environment
here today.
A lot of people are not
happy when you say, "Now get out there and raise this money."
"What are you talking about? You just took away our hospital. Now
you want us to go out and raise money for some restructuring,
where the existing hospital now is carrying a deficit because it
can't do the job?" Who will say today that our health care is
better than it was before? Not very many. But I'll let you carry
on for your reaction to some of this.
Mr Cullen:
I do know that our mayor has an appointment with the new Minister
of Municipal Affairs and Housing and is expecting to, hopefully,
deal with this issue on a more professional basis than we've been
seeing in the news media. It has been very disturbing.
The transition board was
informed that there was a deal for 75%, but it confounds the
promises made by the original minister, the Honourable Tony
Clement, who, when initiating this amalgamation process, told us
that we would be able to maintain service levels and provide
savings. Then we get downloaded an ambulance system.
Now, our ambulance system
is running at 14 minutes to serve somebody 90% of the time, when
it should be at nine minutes. As a result, we have lives being
lost. It was a broken system and we have to pay money to fix it.
We're doing it because the province wouldn't accept that
responsibility. So we're investing money there that's coming out
of the local taxpayers' pocket for what was previously a
provincial responsibility. That's just one small example, but
it's clear and it has been well documented.
Our plea here is, this
government has record-breaking revenues. It has a surplus. There
are crying needs out in the community because of what the
government has done to extract that money: the off-loading of
transit, the off-loading of all these responsibilities.
Therefore, put the money back in so we can have good hospitals,
we can serve business in the growth areas, we can serve our
families in our communities. That's all we're asking: reinvest
that money. You'll get it back. You'll get it back in higher economic activity,
higher taxes, wealth creation, jobs. Everyone's a win-win if you
make that investment, but it's crying out for investment.
When you look at the
hospitals, that's one that can't stay with the municipality. It's
the province that initiated it. This is not some local project
that is 70% province, 30% local; this was a massive provincial
initiative creating massive changes. The responsibility lies with
the people who started it and who are insisting that these costs
be paid for, because the Ministry of Health has approved these
costs.
We're asking for the
investment. It'll pay us all back. It just makes sense.
1550
Mr
Christopherson: It's good to see you, Alex. Thanks for
your presentation. Just a comment and then a question.
On the issue of the
transition board, I don't know whether it's helpful, but you're
not being isolated. The fact is that they're stiffing all of us
who were forced through the process. Maybe a suggestion to you
and your colleagues is to urge your mayor to hook up with the
mayors of Hamilton, Sudbury, Haldimand-Norfolk-
Mr Patten:
And Toronto.
Mr
Christopherson: Well, Toronto seems to be able to take
care of itself quite well. Rather than letting the minister have
the opportunity to divide and conquer, if they all went in as one
and said, "Look, it's one policy that's screwing all of us"-are
they having a joint presentation of all the mayors?
Mr Cullen:
I know there is communication between councils and that a joint
strategy is being developed, because it's happening to us all.
You're right.
Mr
Christopherson: Great.
The other thing is sort of
an open-ended question. All those things you talked about, of
course, are quality-of-life issues. I don't know if you were here
earlier for the presentation from the Ottawa Economic Development
Corp. They talked about the six things that make a city
competitive, and one of them was quality of life.
I guess just your thoughts
on where the overall quality of life in Ottawa is going
vis-à-vis its relationship to attracting investment, but
also vis-à-vis the current quality of life of middle-class
people in your community who could see that begin to
deteriorate.
I'm convinced there's got
to be a message to the middle class that they're not protected
from all this. You can't just look the other way and think it's
only the poor who are getting shafted by Harris. If you haven't
been hit yet, it's only because you haven't come up on the list
and not that you aren't on the list.
Mr Cullen:
We hear from our high-tech sector that they are having difficulty
attracting people to one of the highest-growth areas in Canada,
because we have overcrowding in our hospitals, because our
hospitals need renovations, because they have overcrowding in
schools and new schools aren't built out where they are, because
they can't get housing for the people who clean the offices or
run the cafeterias in these high-tech buildings. There's no new
affordable housing. They're coming to us and saying, "There's a
problem here," and we're telling them, "Yes, there's a problem
here. We need to work on senior levels of government to provide
the infrastructure that benefits us all in terms of quality of
life." We're hearing that message. It's coming from them that
they're running into these difficulties. So it's already hitting
us.
It's hard to compete with
Silicon Valley in California when you don't have these services
in place and they are there. The short answer to that is, it's
affecting us already and has been for the past two or three
years. We've been in this boom, growing like crazy, but no place
to adequately send the kids, to adequately look after the health
portion of it because of the status of our hospitals and to
provide the roads and all the other infrastructure to help this
community grow, economically, in terms of job and wealth
creation, but also as a lovely place to raise your family. It's
unfortunate that we're faced with that, and we don't have a lot
of time to turn that around. Being faced with a bill from
amalgamation that's going to knock out a third of our capital
program-who's cutting off their nose to spite their face here?
This is the fastest-growing community in Canada, and frankly the
government is cutting off its nose to spite its face. It doesn't
make a lot of sense.
The Chair:
You've got another minute, if you want.
Mr
Christopherson: OK. Housing: you've got 15,000 people,
if I recall?
Mr Cullen:
Fifteen thousand households.
Mr
Christopherson: You've got 15,000 households on your
waiting list. I imagine that putting your name on that list is
tantamount to forgetting about it. The reality of actually coming
up with a unit-
Mr Patten:
They stopped taking them.
Mr
Christopherson: I'm being told by Richard that they
stopped taking them after 15,000. Not only that, but by the time
your name comes up, your circumstances have changed so much-
Mr Cullen:
If you get yourself on the list now, it's a five- to seven-year
wait. For seniors it's up to a two-year wait. That's a long time
for a senior to be on a waiting list. It is horrendous. Our
waiting list in 1995, when this government took office, was 7,000
or so. We're at 15,000. This town grows, we've had all this
growth, our welfare levels have gone down-our cost for welfare
didn't go down, by the way-but we can't put people in the place.
There's not equitable sharing of this wealth. There's no place to
house these people. The rental market's gone through the roof.
We've had precious little in the way of new rental
housing-literally, about 200 units altogether in the past six
years. It's unsustainable.
It takes a long time to
turn this around. We can't do it as property taxpayers; it cannot
be done. Yet we see senior levels of government, this province
and the feds, running surpluses. Put it back in the community.
You will get that investment back many times.
The
Vice-Chair: On behalf of the committee, thank you very
much for your presentation, and all the best in your role on city
council.
ONTARIO SCIENCE AND INNOVATION COUNCIL
The
Vice-Chair: The next presentation is the Ontario Science
and Innovation Council. Would that delegation now come forward.
Thank you very much for coming out and taking time to present to
our committee. You have a total of a half-hour for presentation.
What's left over we'll divide equally between the three caucuses
for questions, responses or whatever. Please state your name for
the record.
Dr Suzanne
Fortier: Thank you very much. It's a great opportunity
for us to meet with you. I'm Suzanne Fortier, the chair of the
Ontario Science and Innovation Council. I'm a member of Queen's
University, where I am currently vice-principal, academic. Before
that I was vice-principal of research.
With me is Dr Michel
Chrétien, who is the CEO and scientific director of the Loeb
institute, which is associated with the Ottawa Hospital and the
University of Ottawa.
We are a new council, which
was formed last year. Its creation was announced by Premier
Harris in 1999, and the members of our council were appointed in
June 2000. The role of our council is to be an arm's-length body
that will provide to government, through the Ministry of Energy,
Science and Technology, advice on issues of science and
innovation. We have a very distinguished group of members who are
all leaders in science and innovation, industry, academia and
business, and I think we are very fortunate to have very
committed members who want to be promoters of science and
innovation in the province. We've met only three times since our
inception, and we've already established three key subcommittees
where we will focus our attention. These are: commercialization
and competitiveness, education and skills, and evaluation of
Ontario's R&D investments. We're also embarking on a
benchmarking pilot project to compare Ontario in science and
innovation with other jurisdictions in North America as well as
in Europe.
We think Ontario has a lot
of strengths. Among those are, comparatively speaking, a high
quality of life, a skilled workforce, high-quality post-secondary
institutions, a solid base of innovative companies in a wide
variety of sectors and also a solid base of programs to support
research and development, in particular in the Ministry of
Energy, Science and Technology.
There are also areas,
though, where we need some improvements, in particular, raising
the awareness of the people in Ontario, particularly the youth of
Ontario, of the importance and potential of science and
innovation. Another area of concern is making sure we have the
human capital in sufficient numbers and skills as we move into a
new era where we will have slower growth in terms of the labour
force and, of course, an aging workforce. We have to ensure we
have education and training of Ontario's workforce for the new
knowledge-based society.
One particular concern to
us is the system of incentive and rewards we have, not only to
attract these innovation leaders to Ontario, whether they are
involved in research or in business, but also to retain them in
Ontario. We also need to have a good infrastructure system to
move the ideas, the discoveries, from the laboratories into the
marketplace and into society.
1600
We're working on developing
an innovation strategy for Ontario, that is, providing advice on
an innovation strategy for Ontario. We see a number of key
elements in that strategy. One follows from what I said before in
terms of our strength, but also some of our weaknesses. One is to
develop a high level of public awareness of science, technology
and innovation and their benefits to Ontario's economy and to
Ontario's quality of life. Another key element is an education
system that prepares Ontario's youth for the new economy. A third
element is an environment that supports research and encourages
new ideas and innovation. A fourth element is an infrastructure
that facilitates the commercial application of these ideas and
their transfer to society.
To support this strategy,
we have some suggestions for budgetary strategies. If I can
summarize, these suggestions are largely in three areas, because
these are the three main needs that we have. The first need is to
attract people and to keep them here. The second need is to
provide those people with the tools they need to encourage
research and to encourage discovery. The third area is, once
these discoveries and bright ideas are with us, then to move them
into commercial products and transfer them to society. So the
budgetary strategy suggestions are in those three key areas.
The first one, which is in
the people area, is to provide additional tools and incentives
for Ontario to become more aggressive and proactive in attracting
and retaining science and innovation leaders. I'm sure that
you're aware, as we all are, of this whole debate on the brain
drain and whether we are having a brain gain or a brain drain. I
think most people who are leaders in science and innovation will
say that we are losing key members, we are losing members who are
the leaders, we are losing the top players and that we must make
sure we have in place incentives and rewards so that these people
not only will want to come to Ontario, but will want to stay
here.
The considerations that we
think should be afforded are, first, in fiscal, social and other
incentives, to attract Ontarians back to Canada and back to
Ontario, and also to encourage newcomers to come to Ontario. One
very specific area, and it's among all of those, is a program
that would help us attract foreign graduate students to Ontario.
At the moment it is quite difficult for people from other
countries to come and study in Ontario. There are no financial
incentives, certainly, and it is not easy to bring graduate
students to Ontario. Yet many of those people, as we know, would
end up staying in the province and contributing to its economic
development. Many of these people might return to their country
but then become really key collaborators, key partners for
Ontario in their area of science and innovation. We should not
discourage those people from coming to Ontario, as we have for
the last several years.
We also need similar incentives to retain the
science and innovation leaders that we currently have in Ontario.
I can tell you from where I work that it is a constant struggle.
Practically every day of my life now, I am being faced with
people in my university who say, "I'd love to stay here, but I am
getting great offers," from the US, in particular. "They're
offering me not only a great salary, but they're also offering me
great support for my research." It's very hard to resist. They
ask me, "What can you do for me?" What we can do for those people
right now is quite limited. Certainly, it breaks my heart to see
those people in whom we have invested, in terms of their
education and training, leave our province to go and contribute
to economic development south of the border. We really need to
have programs to make sure that we don't lose those people who
are really the leaders and la crème de la
crème.
Another particular
challenge that we have in this province, of course, is that
enrolment in our universities continues to increase every year
and, as you know, we will be facing a double cohort a few years
from now. We do have to recruit many more faculty members, and as
we are doing so, we are recruiting in an incredibly competitive
market right now, particularly in the key area of science and
innovation.
The second element in the
budgetary strategy is to make sure that we have in place good
programs to support those individuals who are so important for
science and innovation when they are with us. We have a very rich
suite of programs currently in the Ministry of Energy, Science
and Technology. What we do need, though, is to make sure that we
replenish those programs; because of the fact that they're rich
programs, they also have a higher-than-expected uptake, and at
the moment it is projected that their budgetary allocation will
not be sufficient for the programs. In fact, they will expire
before the anticipated time horizon. We need to make sure that we
keep those good programs working.
In particular, in the
Ontario Innovation Trust, we know that we're going to be running
out of funds if we don't replenish that fund. It's a very
important one, particularly because it has a very high leverage
potential. So it's important that this fund be replenished. Also,
it is important for the mandate of the Ontario Innovation Trust
to be expanded so that it can also provide support for operating
use of the infrastructure that the province is investing in so
that we can make sure that these infrastructure investments are
maximized.
We are also suggesting
additional funding for one very good program, the Premier's
Research Excellence Awards program. It's a wonderful program that
recognizes and supports young faculty members in our
universities. It has been enormously successful. Many of these
young people have said that they wouldn't be here in Ontario if
it weren't for this program, that this is really what makes their
work here attractive and possible. We don't have a similar
program for more senior researchers. I think this is a very
vulnerable area, because many of the people we are at risk of
losing are those people who are now starting to really make their
mark. They're very attractive, we've invested in them, and now
that they're about to give their return on that investment, they
are being grabbed by other provinces and by the US. We need a
program to make sure we don't lose those people, because that's a
loss not only of good leaders, but also of an investment that
we've made.
We have another program in
that suite of programs within the Ministry of Energy, Science and
Technology that has been very effective, particularly in
enhancing the collaborations between universities and industries,
and that's the Ontario R&D challenge fund. The suggestion
we'd like to make here is to shift the role of government so that
it becomes a lead investor in that program. We think it's
important for the health of the program, particularly as we are
moving to what appears to be a slower economic growth period,
that government act as a lead investor and therefore act as the
real engine of this program, and an engine of innovation.
The third area is to
promote the movement of ideas, discoveries and new technologies
to the marketplace and to society. The current assessment of the
infrastructure in technology transfer and commercialization in
Ontario is not stellar. There are many areas that need
improvement, particularly when it comes to the very early stage
of that technology transfer and commercialization process. We
need to improve that if we want to make sure that those ideas and
those discoveries turn into new companies, new processes, new
products and new wealth creators.
Where we particularly need
help is in infrastructure support to enhance those activities of
technology transfer and commercialization in the post-secondary
institutions, in universities and in the colleges, as well as in
the Ontario centres of excellence.
1610
Many of our researchers are
coming up with good ideas and with technological discoveries, but
they do need help, particularly to add value to these
technologies before they are ready to be moved to the marketplace
or before they are ready to be attractive to venture capital
investment. We need to be sure that we have in place the capacity
to add value to those discoveries so that they can make their way
to the marketplace. Otherwise they will just be left on the
shelf.
We also need support for
establishing a better environment for training individuals to
work in this area. It's a very difficult job right now to attract
and to hire people for technology transfer offices in
universities or centres of excellence. There are simply not
enough people trained in this province and in this country for
these kinds of jobs, and yet they are very important ones.
We also need a better
networking mechanism at the community level to facilitate
commercialization, to network those spinoff companies, those
innovators and entrepreneurs, to help them and support them in
these activities. We had a meeting recently where we focused
solely on commercialization. People were talking and dreaming a
little bit about how they would like to see Ontario five or 10
years from now. Something that came up certainly was that what we in Ontario need
are more places that look like Kanata, where you have that kind
of a very lively, dynamic community of entrepreneurs and
innovators, that kind of network. We need to promote that.
Finally, an area that would
be very helpful for us as well is to have in Ontario a program
that complements the federal program of industrial research
assistance, the so-called IRAP program. This is a program that
links spinoff industries with researchers so that they can get
help in some of the technological challenges they face at the
beginning of their company. It is one of the programs that many
of the spinoff companies will cite as being an absolutely crucial
element in terms of their ability to survive as a company because
they were faced with technological research and development
problems. They are too young and not rich enough yet to have the
scientific advisors within their company. They need to find that
scientific advice, and IRAP is one way that really helps
them.
These are the main points.
If I can summarize, we think we really need to invest a bit more
in terms of putting this province on the map as a science and
innovation leader, bringing people here and making sure they stay
in Ontario, that they find a place here where they can thrive
and, therefore, that they have the kind of support tools to do
their work and to achieve their goals and, finally, when they
have done so and have come up with these discoveries, that we can
move them to the marketplace and that we have the tools, the
infrastructure available to us to move them to the
marketplace.
You'll see that with our
brief we've also included the news releases that were prepared,
first, when the Premier announced the formation of the council
and then when the membership of our council was appointed. You'll
have a good chance to see as well that we do have extraordinarily
successful science and innovation leaders who are committed to
working for the province to promote science and innovation.
Thank you for your
attention.
The Chair:
Merci, Dr Fortier. We have approximately three minutes per
caucus. I'll start with the official opposition, Mr Kwinter.
Mr
Kwinter: Thank you very much and congratulations on your
appointment and on your new organization.
Years ago, when I was the
minister responsible for technology, we had a conference with the
federal government and all the provinces and there was a
recommendation put forward that Ontario endorsed that 2.5% of all
government revenues should go to R&D. We had trouble getting
many of the other provinces to come on side, but certainly that
was a goal that was supported by the provincial government.
Have you done any research
to see if we're meeting that target?
Dr
Fortier: We are currently doing research in this area. I
mentioned our pilot project of benchmarking Ontario, so we're
going to be looking at a number of indicators, such as the one
that you are talking about, to see how we compare, not only with
other provinces but also with areas, other jurisdictions, that
are known as being leaders in science and innovation. We're doing
the work right now as we speak.
We've already had a group
of people within the ministry who have started to do a comparison
with Massachusetts in this area, but I don't have the results yet
of this benchmarking exercise. This is something we're intending
to do and in fact we're intending to have something that will
look like a little report card that we'll update on a yearly
basis to compare ourselves with these other jurisdictions.
Mr
Christopherson: Thank you and, again, congratulations on
your appointment.
How often will the council
be meeting?
Dr
Fortier: We're going to be meeting, at the very least,
quarterly, and the executive committee will be meeting on a
monthly basis. That will be normally through teleconference, the
executive group, but the full council quarterly.
Mr
Christopherson: The budget of the council is what,
annually?
Dr
Fortier: It's half a million dollars.
Mr
Christopherson: You're the only full-time appointee
who's been named to it, or has everyone?
Dr
Fortier: No. Of the council members, there are no
full-time appointees. We have a secretariat that supports us. It
will consist of three full-time members. Just to put that in
comparison, we're hoping to be a lean but an efficient council.
The similar council in Quebec has a full-time chair and a
20-member secretariat. All members of our council are working on
a voluntary basis. We were told that we would get pay of $1
tax-free a year.
Mr
Christopherson: It's nice to be in a position to be able
to offer that. The only thing I would advise, and I don't advise
the government often, but don't use your acronym, whatever you
do.
Dr
Fortier: We use it in French. It's COSI.
Mr
Christopherson: Ah, COSI. Well, that scares me, as a
member of the opposition. Thank you very much.
Mr
O'Toole: Thank you very much personally and, again,
congratulations. But more important, thank you and the members of
the innovative group of thinkers. Certainly that's what we've
been hearing, not just today but all along, was building the
whole infrastructure piece, and perhaps I'm repeating, but to
respect your input and recognizing what you were really asking
for was the government to continue, whether it's the Premier's
research excellence awards or the innovation trust and other
programs you didn't mention-ATOP, which is access, building the
right client group within the academic group, with which you're
very familiar, and the strategic skills investment, perhaps
funded by a different ministry. But I couldn't agree more.
We've heard the need for
supporting what you could call the quality of life, or you could
call it a healthy society. I think our collective goal, as well
as yours, I'm sure, at the end of the day is sharing that
accumulated wealth of the country or province.
If we were to take a specific initiative in this
area, could you boil this down and say-I think Mr Kwinter
mentioned it-a percentage of GDP or a percentage of the budget?
Is there something we could do? Because unless we build that
entrepreneurial, innovative kind of culture, we just aren't going
to be able to tax everybody to death to pay for these things that
aren't accountable. What would you give us as your most prominent
piece of advice?
1620
Dr
Fortier: I think we have to have a very coordinated and
comprehensive approach. One of the things I did not mention,
because we're still doing work in this area, is the whole issue
of promoting science and innovation from day one, basically. We
need to start in daycare, kindergarten, primary school and
secondary school-all the way. This kind of culture, which is
really the foundation of economic and social prosperity, has to
be a culture that permeates all of our society, and it starts
from day one. That's where we need to put a lot of work.
Right now, I would say that
the biggest challenge we see is in attracting and retaining the
leaders of science and innovation. They are in high demand. They
are incredibly sought after. They are being courted; they are
being made incredible offers. This is what I think is the biggest
challenge that we have now: to make sure they stay in Ontario,
that they come to Ontario and stay in Ontario, because without
those leaders we will not get there. We need those leaders to
serve as promoters, role models. We need those leaders so that
their influence makes its way right through to the primary and
secondary schools, all the way to commercialization in the
marketplace. If I were to name one thing that I'm particularly
concerned about, it is that one.
The Chair:
On behalf of the committee, again, thank you very much for your
presentation this afternoon, and bonne chance.
ONTARIO AGENCIES SUPPORTING INDIVIDUALS WITH
SPECIAL NEEDS
The Chair:
Our next presenters this afternoon are representatives from the
Ontario Agencies Supporting Individuals with Special Needs. I
would ask the presenters to come forward and state their names
for the record, please. On behalf of the committee, welcome. You
have 30 minutes for your presentation this afternoon.
Ms Mary Frances
Taylor: Thank you very much, members of the committee,
for agreeing to hear us today. This is a new venue for the OASIS
agencies, so we hope that our presentation is of use to you. If
there is additional information that you need, please speak up
and we'd be happy to provide it.
My name is Mary Frances
Taylor and I'm a vice-president of OASIS. The other presenters
with me today are Cathy Wood from Ottawa-Carleton Lifeskills, and
David Ferguson from the Ottawa-Carleton Association for Persons
with Developmental Disabilities. Dave is going to hopefully work
the slides for our presentation. OCAPDD's treasurer was hoping to
be with us today, so he may join us in a few minutes.
Mr Patten:
Mary, is this the same as the hard copy?
Ms Taylor:
Yes, it is. We can probably do at least the first page. That just
tells you what OASIS stands for. It's an acronym for Ontario
Agencies Supporting Individuals with Special Needs. It's a
province-wide association and there are 76 agencies that belong
to OASIS. These agencies provide services and programs for
intellectually handicapped adults and children.
One of the OASIS missions
is to work with government to improve the development of
cost-effective quality supports for individuals with intellectual
disabilities. All of the OASIS members, all of the agencies, are
in the business of directly delivering services or supports to
intellectually handicapped people and their families. Basically,
they are all transfer payment agencies.
Ms Cathy
Wood: The individuals we serve are really quite limited
and impaired intellectually. We refer to them as developmentally
disabled, but we formerly knew them as mentally retarded. The
causes that have put them into this category, if you will, are
genetic difficulties, birth trauma, illness and accident and a
host of other things that may have happened during their lifetime
whereby they need this type of support.
They require a wide range
of supports to live in the community. Flipping through to the
next page in front of you, the individual needs are quite
sophisticated and we have seen that over recent years they're
becoming more and more disabled. People who require total care
may be using G-tubes or J-tubes for feeding, with special diets;
many of them require sophisticated medical care, psychiatric
care, many of them with dual diagnoses; many need behavioural
interventions, are physically disabled and have geriatric needs
as our population is getting older.
Ms Taylor:
In terms of the services that are provided for the intellectually
disabled, this is really what the OASIS agencies do with their
tax dollars. I think it's important to remember that every one of
them is an instrument of public policy in Ontario. OASIS agencies
are social service agencies and they deliver publicly funded and
regulated services. Those services range from residential care,
where we operate group homes, supervised residences, apartments
that may have one supervisor for a number of apartments for our
clients, to approved home programs and supported independent
living for those clients who can live on their own but require
someone to check up on them every once in a while and see how
they're doing with their finances.
We operate day programs and
supervised contract work programs, which you often hear referred
to as sheltered workshops; supported work programs, which our
higher-functioning clients have; and programs that we hope will
lead to the clients being able to get independent employment in
the community.
It's important to also
remember that all of these programs require the OASIS agencies to
be owners and operators of real property and to have capital
equipment. All of these agencies are employers with all of the
requirements that go
with managing property and managing staff.
As I've said, some of the
programs are quite straightforward, but others can include
specialized programs because many of our clients have complex
medical needs and psychiatric diagnoses, so that means that our
staff have to be able to administer medication and able to
respond to the needs of the medically fragile. The reason we're
telling you this is that when we get to the staffing aspects of
our programs, you'll see that we can't just hire anybody; we have
to be careful about who looks after our clients.
Basically, our agencies are
responsible to the disabled individuals they support, to their
families, and to the community, and most of them report to
volunteer boards of directors. The boards of directors are
accountable, of course, to the Ministry of Community and Social
Services.
1630
So that's what we do, but
sadly there's many things that we are unable to do. That's really
why we're here today, to tell you what we are unable to do for
clients and what concerns that is causing in the sector.
We have right now in
Ontario very long and growing waiting lists for services. One
province-wide estimate is that there are about 8,700 persons who
are not being served at this time who are waiting for services of
one kind or another. Our existing programs are in fact serving
more individuals than they are funded to serve but the agencies
have tried their best to serve the community as best they
can.
Another serious issue for
our sector is the lack of support for aging parents. We have a
number of parents across the province who've cared for their
developmentally disabled children at home rather than send them
to institutions or send them into programs. Now, as they grow
older, they're looking for programs to help them to manage to get
some respite care for themselves but also for long-term assurance
that care will be available after their death. We find this is a
very serious concern. A number of parents who are in their 60s,
70s and 80s who have a developmentally disabled child say, "What
is going to happen when I die?" That we have no answer for at
this time.
In terms of the agencies
themselves, many feel that they cannot deliver any longer the
services that they've been mandated to deliver. They cannot
operate within their current funding levels. Almost all the
agencies across Ontario are operating in deficit positions and
have been for a number of years.
The agencies cannot
recruit, retain and train staff, and that is the major crisis
that we have come to talk to you about today.
Ms Wood:
There are some causes for this, of course. We have been
experiencing reduced funding levels for over 10 years now. One
provincial estimates study has shown funding levels have reduced
by 6.5%-lower today than in 1991. However, most agencies actually
have done their own estimates of this and think it is actually
quite a bit higher than that.
While this has happened, we
have been experiencing increasing costs at the same time. The
cost of staffing has become so much of a difficulty for us, we
really are in a crisis at this point where we literally cannot
cover shifts at our group homes and in our day programs for our
most disabled people. We have had no cost-of-living increases, or
COLA, no adjustments in this area since 1991, so as our costs for
fuel and other occupancy costs have continued to rise we have not
had revenues to match those costs. It has put us in a very
difficult position.
Increased statutory
employer costs have been levelled on organizations in the last
couple of years, more so than in previous years, but it has
assisted in the mounting stress on organizations; such
legislation as pay equity when we haven't got the money to pay
the employer statutory costs of 1% related to that. Additionally,
we haven't got the funding that has been basically attributed to
that legislation. And we have all experienced huge premium
increases in the area of WSIB, Workplace Safety and Insurance
Board expenses.
What has been happening is
that the quality services depend on commitment and skills of a
qualified direct care staff in order to deliver services to our
most fragile individuals. Our services are highly
labour-intensive at a front-line level or direct care service
level, and on average 80% of our agencies' budgets would be
attributed to direct care staffing.
Our association, OASIS, has
done a provincial recruitment and retention survey which we just
finished in October 2000. The survey was directed to not just
management personnel, human resources and agency executive
directors and boards, but front-line staff, those who have
remained in organizations and those who have since left
organizations. We felt that it was quite broad in its scope.
The findings are rather
alarming:
Seventy-one per cent of all
programs for the developmentally disabled now operating in this
province are operating with less than full-time staff
complements. So we're going short-shifted, if you will, in our
group homes and day programs of whatever varied type.
Thirty-seven per cent
reported that the needs of their clients, the disabled people,
are not being fully met. We believe we are at risk of major
accidents and injuries to our clients as a result of unqualified
staff and not enough on shift.
Forty-nine per cent of
agencies have lowered their recruitment standards and are now
using unqualified staff. This is a dangerous position for us to
be in when we're talking about J tubes, G tubes-all kinds of
total care individuals who otherwise would be at the expense of
living in hospitals or other facilities of that nature. Our per
diems are considerably less in group homes, for example, than
many of the other health care service providers' costs would
be.
Seventy-two per cent
reported overworked, stressed and burned-out staff. Agencies
frequently have been forced to breach statutory employment
standards. It isn't unusual to interview an organization that has
had staff work double, triple and quadruple shifts in order to
cover the needs of their clients. There simply are not enough
staff out there who are interested in working in the kind of
field we currently are in.
Sixty-nine per cent of our
agencies had increased staff turnover. Here in Ottawa alone I'm
aware of organizations that have had 44%, 46%, 50% turnover in
their staff in less than a year's time.
Sixty-three per cent of the
organizations responding reported urgent needs for staff
training. That really goes hand in hand when you have tremendous
turnover and you're having difficulty finding qualified
staff.
Fifty-seven per cent of
agencies, as a result of all these stressors, have reported an
increased use of sick time, resulting in increased overtime and
other costs related to relief staff costs and, of course,
increased insurance premiums.
Most troubling, 100%
reported an increase in work-related injuries to their staff. I
think it's clear that we are in a very bedevilled position. Our
local colleges are reporting to us that they're unable to attract
full recruitment at the student level into the developmental
service worker program, the social services worker program, the
early childhood education program and programs that serve people
in our community.
A recent KPMG study showed
a salary/wage differential of approximately 25% to 30% less for
staff in the developmental services sector compared to employees
in the broader public sector who are serving the same client
population. We in Ottawa-Carleton have done some surveys of our
own, secondarily to the province-wide survey, and we have found
these figures to be absolutely correct.
We have a staff turnover
rate of over 22% across the province. I mentioned earlier that it
was to a greater extent in many of the urban centres. Certainly
it is in Ottawa, Toronto and Windsor. Some of the larger cities
across the province have experienced a turnover much greater than
the 22% average.
As an example, within
Ottawa there exists a wage gap of $9 per hour between
organizations that are actually doing the same kind of work. This
was determined through the survey we did last summer. Some
organizations are paying their staff around $10.50 per hour-and
that would be a university degree or college diploma
program-right through to now $19.25 per hour, which creates
tremendous difficulty in terms of competition in recruiting staff
to do the same work here in our own city. The same story is true
across the province.
Within Ottawa, as I
mentioned earlier, some of us are experiencing a 50% turnover and
are very leery of the difficulties we are having in delivering
excellent services, or even close to excellent services, to our
front-line folks.
1640
Ms Taylor:
This situation, of course, hasn't come upon us overnight. Those
of us who are on boards of directors have been living with it for
a number of years, and we have been doing things to try to adjust
to the funding problems we've had. Certainly we've reduced staff;
we've reduced the management and administrative staff first, and
then when we've had to we've gone into direct-care staff. We have
economized, rationalized and minimized our services. We've tried
to strip our administrative costs to the bone. We have certainly
deferred staff training. We have very often deferred repairs to
our property, repairs to the vehicles we operate, and we've not
been able to do any expansion, even though there has been an
increase in the number of people looking for services. We have
increased our efforts to raise private funds, and that, of
course, always seems to be an easy answer: go out and do more
fundraising. But it's not always easy in some of the communities
where the OASIS agencies are found.
So we have come to what we
feel is really a major crisis in this sector. We know that of
course you've got many people coming to you looking for funds at
budget time, but we really felt that we had to bring this to your
attention because this is a population that's not popular. It's
not an easy cause. We don't ever want to feel that we're in
competition with others who are looking for funds from you, but
please don't forget that we are here.
Funds, we feel, are
urgently and immediately needed to address staff salaries. We
must do something immediately about that 25% to 30% wage gap.
There must be significant base funding increases to address the
community needs. Those three issues that we feel need to be
addressed are: the long and growing waiting lists for services in
communities in Ontario; we need to address agency operating
deficits; and we need to do something about the needs of aging
parents of developmentally disabled adults and children.
Thank you very much. That's
the end of our presentation. Mr Doug Ward has joined us. He is
sitting over here to my left.
The Chair:
Thank you very much. We have approximately three minutes per
caucus.
Mr
Christopherson: Thank you for your presentations. I just
wanted to go back. I'll start with the adult children and that
concern. I've had that in my constituency office. I've had
parents come in, both individually and city-wide groups, saying,
"What are we going to do? We don't expect to be here in 15 or 20
years. We're not independently wealthy; there's not enough in our
private wealth to sustain this kind of service." I jotted it down
when you said that you don't have an answer for them at this
time.
As I understand it, this is
different from the historical context, because it has only been
the last couple of generations where we've recognized that the
ability to keep an individual at home benefits the family,
benefits the individual and can be cost-effective. What happens
now, while we're still on the edge? You say, "We don't have an
answer at this time." What happens? Do they just go into an
institution? What happens to individuals right now, without
plans, while we get caught up with it in the bulk of the people,
with the boomer generation still being a bulge of population? It has still got to be
happening to individuals. What's the reality right now, as we
speak?
Ms Taylor:
I'll maybe let Dave or Cathy answer as well, but my understanding
is that the reality is that the parents are doing the best they
can, and they are taxing themselves. Their own physical health is
suffering. Occasionally, they are able to get relatives to come
in, but basically they are just doing the best they can. We heard
stories of 80-year-old parents who are driving their adult
children 30 or 40 miles to a day program.
Mr
Christopherson: I was seeking the scenario where the
parents have passed away and the adult child is 55 years old, 50
years old. What's happening? What happens in that case, where
there's no family money, no family attachment, the parents die
and the adult with the disability is there? What happens right
now?
Ms Wood:
If there isn't a next of kin to pick up the responsibility, an
organization called Service Coordination-I'll use the example of
Ottawa-will try to refer that person to one of the current
organizations. The difficulty is that they're really at a
stalemate in having to go to the province and ask for special
monies, not well-planned for, unfortunately, to serve those
individuals, and it generally ends up at a higher cost.
When we know these people
are there and we can plan for them in advance and we know their
names and we know everything about them and we know their
situation is in dire straits, it is far better for us to get at
that planning and do something about it than to have them picked
up in a crisis position, when they are put wherever there can be
found a space or an expanded space.
Mr
Christopherson: The answer is that it's ad hoc, do what
you can.
Ms Wood:
It's ad hoc, do what you can. Most often, they'll move from one
parent to another member of the family. As Mary Frances said, and
certainly my own experience is that most of the new referrals
that I received last year-in fact all of them-came to our agency
in crisis, and all of them were from parents who were 80 years or
better.
Mr Arnott:
Thank you very much for your presentation. I'm concerned, like
you are, about the issue of aging parents with children with
developmental handicaps and how we can help them, provide
reassurance that once they are no longer able to look after their
children there will be something there for them. We heard about
this issue in Toronto before we came here. There was some
reference to the fact that the government had allocated about $50
million, if I'm not mistaken, to help solve that problem. But I
understand it wasn't even close to meeting the need in Toronto.
Have you quantified the degree to which you need resources in
Ottawa? How many families do you have waiting for this kind of
help?
Ms Wood:
There are 250 individuals in Ottawa now waiting for services in
either day programs or residential.
Mr Arnott:
I'm not authorized to speak on behalf of the government on this
issue, but I want you to know that there is a considerable number
of members of our caucus who share your concern and would like to
see this issue resolved, so we will be taking it forward on your
behalf. I want to thank you very much for your presentation.
Mr
O'Toole: You mentioned two important things. Currently,
do you have a deficit, and what is it? That's the first one.
Ms Wood:
My own agency's deficit is about $250,000.
Mr
O'Toole: That's an annual deficit?
Ms Wood:
No, that's cumulative. I'm operating this year with $160,000 to
add to that.
Mr
O'Toole: I have just one last question. You mentioned
also the wage crisis. I'm not in any way in contradiction with
that; I just want to understand. Between $10 and $19, where do
you fit on that scale yourself?
Ms Wood:
My own agency has recently received an increase as a result of a
labour action under HLDAA legislation, the hospital-arbitrated
legislation. So we have moved up to $18.90 from $14.40. We were
one of the lower-paid agencies until that time. The funding has
not been secured. It's a matter of some fiscal-
Mr
O'Toole: You'll carry it as deficit.
Ms Wood:
Yes.
The Chair:
To the Liberals. Mr Patten.
Mr Patten:
It sounds like you're in dire straits. What is the overall number
of how many people are served? You've got a waiting list here of
8,700. How many people do you serve across the province, all
these agencies?
Ms Wood:
Richard, we actually tried to find that number out, and we were
not able to find it out. What I can tell you is that it's greater
than 1,500 who are being served here in Ottawa-Carleton, with
about 500 on the waiting list yet. I don't know if you could do a
pro rata across the province in terms of an extrapolation of
those numbers-probably not-and have it correct. We were unable to
find out the exact number of people receiving service across the
province. We were afraid you might ask that question.
Mr Patten:
A ballpark figure of 50,000 or something in that
neighbourhood?
Mr Douglas
Ward: It wouldn't be at all surprising if it was more
than that.
Ms Wood: I
think probably more than that.
Mr Ward:
Very likely more than that.
Mr Patten:
Anyway, there's obviously a crisis here. Has the auditor general
approached you on any of this? Have they looked at this area? Are
you aware of it?
1650
Ms Wood:
Not that I'm aware of.
Mr Ward:
The Provincial Auditor?
Mr Patten:
Yes, the Provincial Auditor.
Mr Ward:
The Provincial Auditor has commented in the past on the
administration in the sector, but the Provincial Auditor, to the
best of my knowledge, has not approached individual agencies or
somebody like OASIS representing the agencies.
Mr Patten:
I have lots of questions but one is on pay equity. Many of these
organizations are providing services that the government has
mandated and are acting on behalf of the provincial government
but are then forced to
pick up the costs of pay equity. In order to pay for the pay
equity costs, they must take from other parts of their budget,
with no additional support from the provincial government, even
though the provincial government is the one that is dictating
that the pay equity should be implemented. Is that correct?
Ms Wood:
That's correct.
Mr Patten:
What is the significance of that in terms of general dollars or
ballpark figures for your agencies? I'm aware it cuts across many
sectors.
Ms Wood: I
believe it's in the range of about 1% of statutory costs the
employer would pay of pay equity. So, for example, if $100,000
was received, the employer would have an expense relative to the
statutory costs. I think I'm incorrect on the 1%. I think it's
actually significantly greater than that. I know our own agency's
costs are in excess of $70,000, cumulative. Before I ever start
budgeting, I'm in trouble $70,000 just with the subject of pay
equity.
Mr Patten:
So you probably have to cut staff and cut programs in order to
keep certain staff.
Ms Wood:
Continually.
Mr Patten:
You continue to operate with fewer services and less staff to do
the job.
Ms Wood:
That's right, to still operate outside of the statutory
requirements of an employer.
Mr Ward:
If I might comment very briefly in response to Mr Arnott's
reference to the $50 million, yes, indeed, there was an
additional allocation of $50 million. There were a number of
purposes attached to that $50 million. The problem of aging
parents was one of them. It was not devoted exclusively to that
topic. There were other specific targets in the developmental
service sector.
Mr Arnott:
That's why I was asking the question.
The Chair:
On behalf of the committee, thank you very much for your
presentation this afternoon.
Our last presentation, and
I know it's been a long day, but it's only half an hour, is from
Child and Youth Friendly Ottawa. It's my understanding that the
presenter is here but he's just stepped out. We'll take a recess
to find our bearings.
The committee recessed
from 1654 to 1655.
CHILD AND YOUTH FRIENDLY OTTAWA
The Chair:
On behalf of the committee, welcome. Could you state your name
for the record. You have 30 minutes for your presentation.
Mr Marc-André
Belair: My name is Marc-André Belair. I was the
federal Progressive Conservative candidate of record for
Ottawa-Orléans.
I'd just like to wish you a
good evening and thank you, Mr Chair. It's my pleasure to be able
to stand before you today, or sit, in this case. I was asked by
my esteemed colleague, David Millen, of Child and Youth Friendly
Ottawa, to speak to you today about the lack of youth
representation in our decision-making processes.
There seems to be a certain
cynicism among youth these days concerning the adult world. They
have lost faith in our system. They feel as if they have no say,
no means to express their dissatisfaction. When young people are
unable to express their dissatisfaction through conventional
means, they will often revert to means that are not socially
acceptable. They will throw rocks. But this rock carries a
message of suppression and frustration.
So how do we prevent our
young people from throwing such rocks? Although there is no easy
answer, many would suggest putting more police on the streets.
This may be effective to a certain extent, but this measure could
be seen as draconian and perceived as a further suppression of
our young people's message. There is no easy answer.
However, some options do
exist that would empower young people, that would give them a
sense of control and a feeling of pride in their institutions.
The option that I'd like to present to you is the concept of
youth representation in our political processes.
I must commend the
committee for allowing a few youths, such as myself, to sit on
this panel today. However, I still get the impression that there
is a certain amount of tokenism in these sorts of consultative
processes. The government of Ontario must make a habit of
encouraging young people to stand before and even sit on
committees such as these ones. Young people will be the ones
taking over this country. Does it not logically follow that we
should encourage them to get involved while they are young so
that they have a chance to develop a sense of ownership and pride
in their institutions?
It's a shame that our
society supports the misconception that young people are not
capable of making a difference. If anyone thinks that, they're
wrong. Young people have the capacity to do some incredibly
amazing things. Unfortunately, they're not given the chance and
freedom to really shine. We don't give them more than a token
place at the table.
If we actually listened to
what young people had to say, instead of telling them what to
think, I would not be too surprised to hear of young people not
only getting involved but demonstrating the fervour and zeal that
only young people can exhibit. But I can also see that their
fresh point of view would provide a unique and refreshing
perspective on issues that you are all here to examine.
I encourage the standing
committee on finance and economic affairs to consider my
suggestions in your future deliberations. It has been said many
times that young people are our future and it would be truly a
waste and a shame to waste this precious resource of talent and
young thinking. When deciding on matters of economy and finance,
I encourage you to offer young people more than just a token
place at the table, but instead a real opportunity to express
their views and to effect change in a system toward which they
have become jaded. Thank you.
The Chair:
Thank you. We have about eight minutes per caucus and I'll start
with the government side.
Mrs
Molinari: Thank you very much for your presentation and
for taking the initiative to come forward. I'm a little
disappointed at your cynical view of young people. As a mother of two boys, 25 and 22,
I certainly value their opinion and their forcefully putting
their opinion forward every chance they get. Within a number of
our offices there are a lot of young people who contribute quite
extensively to a lot of the decisions and input that we have.
In your presentation I
didn't hear any recommendation or any specifics that you would
see that we could do as a government that would respond to some
of the concerns you've expressed here today. Can you tell me
about some specifics that you would like to see implemented or
initiated that would address the concerns you've expressed?
Mr Belair:
Certainly. I would certainly encourage the government to get more
young people on board, such as these. There doesn't seem to be an
active solicitation of our young people in terms of getting them
out and expressing views, especially marginalized youth. They are
often forgotten in our system. We just don't tend to value their
opinions. I do agree that the government has taken many steps to
help and bring forward some more young people. Yes, there are
some examples of young people, such as your own children, who
will get out and actively solicit.
1700
But the problem is that
most young people do not know where to go and there just needs to
be more active participation on behalf of our decision-making
entities to really show young people that there is a place for
them at the table. A lot-and I do mean this based on my
experience as a mayoralty candidate and as a federal Progressive
Conservative candidate-of young people who talked to me said,
"You know, it's great what you're doing but they're just going to
look down at you and say, `Ah, he's young. He can't do anything.'
You'll be offered a place at a table every so often but no one's
really going to listen to you." I think that's the overwhelming
opinion of a lot of young people.
I would like to see the
government encourage more young people to speak at these sorts of
hearings. I know they are open to the public but young people
really don't know where to access these kinds of committees.
Mrs
Molinari: How would we do that? How do you see us
encouraging, because these hearings are put on the Web site,
they're published throughout. How would you see us doing
that-actually reaching out to the youth and young people?
Mr Belair:
I think there needs to be some awareness campaign implemented.
You won't see very many 15-, 16-, 17-, 18-, 19-year-olds who
really are marginalized go to the government of Ontario Web site
and actively look for a committee that they can speak on. They
just don't know where to find this information. A lot of these
young people just go to school, if they're lucky; they go to
university if they're lucky. Otherwise, they fight for their
existence. So I would suggest that there needs to be some sort of
awareness campaign in order to get more people involved.
The Chair:
Mr O'Toole.
Mr
O'Toole: Thank you for being here today, because you're
speaking exactly toward the issue you're raising, so I'll give
you credit for that. I would encourage more young people to do
it. I really quite genuinely mean that.
As a parent with five
children, all of whom I believe have been somewhat animated-and
I've been somewhat aggravated, I suppose-but no, you have to
somehow change the scales and that's by sometimes provoking.
I would say, without trying
to turn this into a political thing, the requirement of having a
school trustee be a youth is one initiative. Some say, and I
don't mean this but it's been said to me, that it's a sort of a
token thing. I know the trustees in my area are a force to be
reckoned with, specifically on the lack of extracurricular
activities. They've been the only sane voice. In fact, they've
carried it rather dramatically, I might say, to the streets. I
can't say I encourage dissent, but they did get my attention
right in front of my constituency office.
There's a number of
programs: the summer youth employment opportunities, an extremely
important Web site for that for young people. It's a huge
initiative and commitment by the government.
Another one: today is the
last day for high school students to apply to the Lieutenant
Governor's awards, an internship I believe for-I forget how many
students. That's also on the Web site.
I think all parties tend
to recognize the importance of all of these things we're talking
about: education, young families, Ontario's Promise program. I
think the radar's kind of moved a bit.
The research council
mentioned attracting and retraining our youth. Several presenters
today mentioned it and I, for one, thank you for being here. Keep
up that kind of diligent, responsible, mature presentation stuff.
I personally think you are being listened to. Thank you.
The
Chair: Mr Kwinter.
Mr
Kwinter: Thank you very much for your presentation. I
welcome your comments. I don't agree with a lot of them and I
want to give you a few examples.
Probably 20 years ago, a
young man was elected mayor of Brockville. The youngest mayor in
Canada, he was in his very early 20s. He was elected mayor.
I used to be the
vice-president of the Ontario College of Art and we instituted a
unicameral system of government. It was the first post-secondary
institution that had students on their governing council. That
was 20-some-odd years ago.
Every political party has
a youth wing. Every riding association, when they send delegates
to their conventions, have to send a fixed quantity of
youth-that's mandated.
If you take a look at our
page program at Queen's Park, we have grade 7 and grade 8
students getting an opportunity to see the government in action,
and from that we have lots of young people who, because they
become sensitized to what's going on, become involved. There are
a whole range of things like that. All you have to do is take a
look at the Globe and Mail this morning. There was a 12-year-old
on the trade mission to China with the Prime Minister. He's an
entrepreneur at 12, and he's on that program.
Mr Patten: He lied
about his age. He was 11, actually.
Mr
Kwinter: What I'm saying is that the issue you are
addressing is not exclusive to youth. There are lots of adults
who don't get involved, don't know how to get involved, don't
make their presence felt. So as I say, I welcome your input and I
welcome whatever you can do to get young people involved, but I
can tell you, don't sell short the young people who are out
there. There are some fabulous young people out there doing
incredible things.
I just finished reading a
book-I haven't quite finished it-called Sale of the Century. It
deals with Russia and it talks about these oligarchs and how
these people become billionaires. The most incredible thing, when
I read it, is that they're 23, 24, 25. They had been suppressed
for so many years that finally, when they had the opportunity,
they just went for it-mind you, they got into lots of problems
because they literally expropriated everything, but they were
young people. What I object to-and as I say, I don't mean this in
a negative way-is I think you're not giving the young people as
much credit as they deserve.
Mr
Belair: I will agree with you that there's a handful of
people out there who are doing some really spectacular things.
Unfortunately, it really doesn't account for the growing feelings
of disillusionment and cynicism that young people are expressing
today. You see a few examples of people doing spectacular things,
which is great, but they account for even less than 1% or less
than 0.5% of our young people. These people tend to come from
privileged backgrounds; they tend to have high scores in high
school and in university. We're not talking about the average
student; we're not talking about the average youth here. That's
what I'm concerned about. I'd like to see more average people
getting involved-and I don't mean the term "average" in a
derogatory fashion or anything; I just mean people who don't come
from privileged backgrounds, whose parents aren't in the
upper-income brackets. These are the young people we need to
engage, because these are the young people who are suffering the
consequences of mismanaged government dollars.
Mr
Patten: You've talked about youth. I presume that's sort
of the teenage group and up. Could you talk a little bit about
the organization you represent in terms of Child and Youth
Friendly Ottawa? I think there's a concept there that you haven't
shared yet, a pretty neat concept that has been catching on
throughout the city and the area and that the members would be
interested in hearing about.
Mr
Belair: I believe Alexis will be more adept in answering
the issues on Child and Youth Friendly Ottawa.
Mr Alexis
Carty: My name is Alexis Carty. I work for Child and
Youth Friendly Ottawa as a coordinator.
To put it in a nutshell,
we've always had a very difficult time describing what Child and
Youth Friendly Ottawa is. One can literally say that's what it
is: it's child- and youth-friendly. We try to ensure that Ottawa
has a child- and youth-friendly city. We believe-and I'd like to
think this is represented here in this room as well-that the
health and welfare of a child or a young person is directly
related to the health and welfare of a province. One can easily
judge a province by seeing how socially well-adapted their
children are, how employable their youth are. It's one of the
things we try to ensure, that this city as a whole comes together
and works toward community engagement. I think that's pretty
self-explanatory, but I wouldn't mind breaking it down.
In community engagement,
what we're really hoping to see is a lot of businesses taking it
upon themselves to work directly with youth, to see a lot of
adults, such as yourself, Mr Arnott, work with youth directly.
The key here, we find, is that children and youth tend to have
the feeling, as you so aptly put earlier, that a lot of people
are not paying attention to them. They feel a lot of people don't
care about how they feel or about their direction or future until
it's too late.
1710
I know the government on
the whole has placed a lot of money toward at-risk youth, and
rightly so, though I feel one of the things Child and Youth
Friendly Ottawa seeks is to have any kind of money that could be
directed, placed toward more well-adapted children-we have no
problem whatsoever representing "well-adjusted" children as such.
What we're gearing to see is that more money is placed toward
mentoring programs, sports camps, YMCAs, boys' and girls'
clubs-initiatives of that nature-for this is where your community
leadership comes from.
Mr Kwinter talked about
the 12-year-old who went abroad on that trade mission. I think
that's incredible. I look at people such as Craig Keilburger as
incredible. But when I think of that as incredible, I think,
"Shame on me. Why should that be incredible? Why should that not
be the norm?" I continually see bright people around me, and I
have a feeling that when you were young men and young women you
probably thought of yourselves as fairly bright with ambitions
and goals and dreams, and we like to see them all come to
fruition. To see that come to fruition involves community
engagement. It involves all of us coming to the table-which is a
lovely quote; it's one of my favourite ones, by the way-and
breaking bread and understanding what we need to see happen. We
don't want youth-everyone's children, everyone's youth-to be
viewed as a special-interest group, not in the least, because
they're not. Seeing them raised to become socially adaptable, to
become employably viable is everyone's responsibility. Let's be
realistic. They're going to be paying for our futures. They're
going to be taking care of all our debts. We need to make sure
that these are the type of people who have a future, something to
be proud of, something they can grow up with.
Child and Youth Friendly
Ottawa-and I'm sorry I kind of got off topic a bit, Mr Patten-is
four years old. It started in 1997 through the vision of some
workers from the children's aid society, Mr David Millen, and
through the help of Max Keeping and the Catholic school board.
What Child and Youth
Friendly Ottawa has sought to address is the growth and
development and the health and welfare of our children and
youth.
Toward that end we've
been working on a number of government initiatives and local
business initiatives-a program such as Youth 2000, where we help
youth find jobs in the Ottawa-Carleton region, not by creation
but by convincing employers that the next person they should hire
should be a youth, making them realize that that 16-to-24-year
range is an exceptionally exciting time to be working and to have
that kind of energy and catalyst behind your organization is
strong.
The
Chair: Thank you very much. We've run out of time. Mr
Christopherson.
Mr
Christopherson: Thank you both very much for your
presentation. The first thing I want to say is that both of you
are making me feel really old, at a point when I'm very tired at
the end of the day.
I have a couple of
thoughts and maybe a question. I heard two presentations. One was
sort of about the process of Parliament and having
representation, and the other was more directed toward the
specifics of where you think the emphasis ought to be in the next
budget.
I'll take one of your
last points first, if I might, when you talked about hiring a
young person. I'm sure you can appreciate that an employer would
hear that argument and would also receive pressure to hire an
older worker who may be caught between being too young to retire
and not able to continue in the job they were in. There's
pressure to try to give them employment to get them to 60 or 65
until they can hook up to their pension.
There's good reason for
an employer to respect that pressure if they can offer someone an
opportunity they wouldn't otherwise get so they're not thrown on
the social scrap heap at the end of their life either, as opposed
to your argument that they're not being given a chance to join in
at the beginning. You've got pressure to take a look at hiring a
woman where you can and everything else is equal, to take a look
at an opportunity to hire a visible minority or someone who has a
physical or intellectual disability where you can and everything
else is equal. There are a whole lot of pressures on employers
and on society. If you want to comment on that, I'd appreciate
it.
The other thing I would
ask you is on the budget itself. Given that you're here and have
certainly made your case that there is a perspective that is not
being represented as well as it could be, what do you think would
be in the best interests of our young people in terms of how the
budget should be shaped?
Mr
Carty: If I may respond to the former of your
statements, I believe the pressures are very great on society. I
don't, however, believe the pressures are very great on
businesses. Businesses really tend to feel they'll hire who they
want to, who they need to, quite evidently who they feel is the
best for the job, actually maintaining some basic biases as well
with regard to what youth could possibly bring to the table.
Again, when people hear "youth," they think of the media images
that have been conjured up thanks to MTV, thanks to certain
productions on television. They have a conception of what youth
are.
I clearly feel it's in
the government's best interests to see youth portrayed in a
different light, to have youth envisioned in a more profitable
way toward everybody, because youth do bring so much; it's not
even funny. I think of the number of stories and anecdotes I have
seen and heard since I started Child and Youth Friendly Ottawa. A
classic example is about an 18-year-old who couldn't get into
Sheridan College for graphic arts. They just felt that his
development wasn't that strong, his marks weren't that strong.
However, he was able to find a job working here in Ottawa pulling
in close to $95,000 a year. Now, Ottawa is quite unusual in that
respect because we have more young millionaires than I think
anywhere else per capita in the world. Ottawa's very unusual, so
I wouldn't want Ottawa to be viewed as the norm for Ontario.
Mr
Christopherson: Nobody sees Ottawa as normal, trust
me.
Mr
Carty: I imagine not. To the latter of your statements,
I really feel that-and I stated this before-an effort this
government could really, truly make to make a strong impact and
send a message is to clearly take youth seriously, to place a lot
of emphasis and concern on their issues-issues such as basic
safety, places where they can play safely, places where they can
gather safely, places where they can share with like-minded
people safely. I don't think I'm repeating the word "safely" too
much, because it really is a strong word which we need to bear in
mind. By putting money toward that end, to seeing, say, a boys'
and girls' club grow and develop, to see, say, a Child and Youth
Friendly Ottawa offer new and exciting programs to other
organizations, to see basic schools have opportunities to extend
themselves so teachers can go that extra mile they used to back
in your day, Mr Kwinter-I'd like to see that come to fruition. I
think that's where the government can really step in.
The
Chair: On behalf of the committee, thank you very much
for your presentation this afternoon. Good luck.
Mr
O'Toole: Mr Chair, I'd like to entertain a motion to
allow a couple of young people in the audience from Hastings and
Prince Edward Developmental Service Providers-they've sat here
all day. I wonder if we could give them five minutes to make
their presentation. The bus doesn't leave till 6.
The
Chair: In order to do it, I need unanimous consent.
Agreed? So five minutes? Is that adequate? OK.
QUINTE VOCATIONAL SUPPORT
SERVICES
The
Chair: If you could state your name for the record,
please. I think you presented us with a written submission
earlier on this morning, if I recall.
Mr Patrick
Connor: Yes, we have, sir.
Mr Chair, members of the committee,
this is Tina Warren. She's the president of my board. My name is
Patrick Connor and I'm the executive director of an agency known
as Quinte Vocational Support Services in Belleville. I thank you
for your time and for making time for us here this afternoon.
I have two reports that
I'd like to offer you. One we have tabled in written form. That
comes from a collective process of board presidents that we have
on the go in Hastings and Prince Edward counties. There are some
data in the particular report. Some of the comments of OASIS, to
which agencies the board presidents' committee belongs-we really
reflect some of those crises.
Our agency is a day
support service provider. It relies on the residential service
providers in our area for clients so that we can do our work.
Their pressures are our pressures; we just react to them via a
trickle-down mechanism, if you will. They feel pressure. We feel
it down the line.
1720
Many of our agencies are
arguing that there hasn't been a significant capital
infrastructure. That places the residential service providers at
risk. It results in the possible curtailing of service.
Where the OASIS agencies
from Ottawa represented some, I think I heard 1,500, we've
actually absorbed nearly 2,200 people into our community, what
with the closure of Prince Edward Heights. We believe in that
deinstitutionalization. However, we also believe in the support
of community-based operations such as ourselves.
We would suggest, in the
data in the forms provided, probably an infusion of about 15% on
top of the $31 million that already flows into our area in order
to meet that immediate crisis. That would be our particular
request. Certainly, if the members of this committee could
encourage the finance minister to listen to the Honourable John
Baird when he makes his plea on behalf of our agencies in
cabinet, we would certainly appreciate it if they were sensitive
to his arguments, because we are passing these along to him as
well.
The second part is really
what I would like to allude to. There has been some controversy
within the social service delivery sector about ODSP, the ISS and
ESS component. All I can tell you is that it is a program that
offers that mechanism in our community. We have been able, I
believe since April 1, 1999, to offer this service to 30
individuals through our agency and we have been able to
successfully pass 23 of those individuals through our program to
reduced dependence upon social services.
The argument we're making
here today is that the area where we could use the support of
government, and from all parties, in fact, is the building of
better relationships with our community through our MPPs, to have
the help of the government in terms of building bridges to
businesses that allow us an opportunity to provide work as an
employer, but also to provide employment training. We've
demonstrated a success that we're able to educate our client
staff, through the acquisition of life skills, to provide them
with independent skill sets so they can go out and function at
minimum wage or better than minimum wage. We've been able to
negotiate with companies for whole production lines, production
lines of deaf people, production lines with sporting goods
companies, not your usual sheltered workshop type of
environment.
I think your comment
earlier, Mr Christopherson, was quite right. Of the 118 client
employees I have, 57 live at home. If we're able to set them up
now through positive relationships with employers and maintain
that, then what we're doing is actually providing a reduced
dependence in the future on these residential settings, that are
already in crisis, promote better independent living, reduce the
dependence upon government and improve the quality of life.
My argument would be,
don't forget the day support and the sheltered workshop options
when it comes to weighing in the balance the needs of the
residential service provider. I think what you really need is
another viable mechanism that offloads those pressures, in terms
of population management. I would encourage that on behalf of the
parents within my group who are aging and are facing that crisis.
If we can do more prevention now, it's going to save a lot more
demands on the system. Of my population, 15% have been in
conflict with the law and they've done time in detention
centres.
If we can build in these
mechanisms, like we have through good relations with the business
sector, to provide them with a place to go, whether it's evening
work or a morning shift-quite often, evening shifts give families
back time that they didn't have before-we're building a stronger
family infrastructure. We can build those relationships with
business but we need an opportunity to do so. That would be my
short sound bite.
The
Chair: On behalf of the committee, thank you very much
for your presentation.
On a personal note, I
think it speaks very well for your organization that both of you
stayed here all afternoon to take a chance of getting your 10
minutes in front of this committee.
Mr
Connor: Thank you very much. We've taken a different
stand than most of our organizations, but I think the
independence of the client really speaks for itself in terms of
strategy.
The
Chair: With this, the committee is adjourned and we'll
reconvene tomorrow at 9 o'clock in London.
