Legislative Assembly of Ontario

CROWN FOREST SUSTAINABILITY ACT, 1994 / LOI DE 1994 SUR LA DURABILITÉ DES FORÊTS DE LA COURONNE

CONTENTS

Thursday 15 September 1994

Crown Forest Sustainability Act, 1994, Bill 171, Mr Hampton / Loi de 1994 sur la durabilité

des forêts de la Couronne, projet de loi 171, M. Hampton

STANDING COMMITTEE ON GENERAL GOVERNMENT

*Chair / Président: Brown, Michael A. (Algoma-Manitoulin L)

*Vice-Chair / Vice-Président: Daigeler, Hans (Nepean L)

*Acting Chair / Président suppléant: Carr, Gary (Oakville South/-Sud PC)

Dadamo, George (Windsor-Sandwich ND)

Grandmaître, Bernard (Ottawa East/-Est L)

Johnson, David (Don Mills PC)

*Mammoliti, George (Yorkview ND)

Mills, Gordon (Durham East/-Est ND)

Morrow, Mark (Wentworth East/-Est ND)

Sorbara, Gregory S. (York Centre L)

Wessenger, Paul (Simcoe Centre ND)

White, Drummond (Durham Centre ND)

*In attendance / présents

Substitutions present / Membres remplaçants présents:

Carr, Gary (Oakville South/-Sud PC) for Mr Arnott

Conway, Sean G. (Renfrew North/-Nord L) for Mr Sorbara

Duignan, Noel (Halton North/-Nord ND) for Mr Mills

Ferguson, Will, (Kitchener NDP) for Mr Dadamo

Hodgson, Chris (Victoria-Haliburton PC) for Mr David Johnson

Hope, Randy R. (Chatham-Kent ND) for Mr White

Jamison, Norm (Norfolk ND) for Mr Mills

MacKinnon, Ellen (Lambton ND) for Mr Wessenger

Morin, Gilles E. (Carleton East/-Est L) for Mr Grandmaître

Wood, Len (Cochrane North/-Nord ND) for Mr Morrow

Also taking part / Autres participants et participantes:

Ministry of Natural Resources:

Wood, Len, parliamentary assistant to the minister

McGowan, David, policy advisor, legislation and special projects

Clerk / Greffier: Carrozza, Franco

Staff / Personnel: Beecroft, Doug, legislative counsel

The committee met at 1020 in committee room 2.

CROWN FOREST SUSTAINABILITY ACT, 1994 / LOI DE 1994 SUR LA DURABILITÉ DES FORÊTS DE LA COURONNE

Consideration of Bill 171, An Act to revise the Crown Timber Act to provide for the sustainability of Crown Forests in Ontario / Projet de loi 171, Loi révisant la Loi sur le bois de la Couronne en vue de prévoir la durabilité des forêts de la Couronne en Ontario.

The Vice-Chair (Mr Hans Daigeler): This committee will continue its clause-by-clause consideration of Bill 171. Good morning, everybody. I hope we'll continue with the speed we started to pick up late yesterday afternoon, but we'll see what happens on this last day that's been assigned to us in the between-sessions period.

Yesterday we left off at discussing Mr Brown's amendment to subsection 18(2). Is there further discussion on this particular amendment?

Mr Michael A. Brown (Algoma-Manitoulin): Just so members are reminded of what we are speaking about, we are speaking about the right of a minister under this section to treat all information that he requires and may get by ordering a company or a private individual to pay for a study which may or may not be related to the timber management of an area -- the minister is, in this section, taking control of that proprietary knowledge that has been provided by a company or an individual. We believe that to be a gross invasion of privacy and are very concerned that there appears to be absolutely no control over what information can be made public.

I think members can understand the ramifications to small and even large businesses of having proprietary knowledge provided through the entire province without any protection at all. I'm sure the parliamentary assistant will say, "Well, no, we won't distribute that knowledge," but there's nothing in this section that prohibits that. There's no part of this section that says the minister and the actual holder of the licence must have a protocol to agree on what information can be disseminated widely and what is private information. In view of that, we see this, as I said yesterday, as Big Brother at his worst.

I would ask the parliamentary assistant if he believes it is necessary to have this section in the bill; whether he would not be willing to propose an amendment that could restrict the dissemination of that knowledge only with some kind of agreement with the proponent or the licence holder, some such mechanism, to ensure that private individuals, private companies, do not have information that should not be in the public domain, at least from their point of view, provided to the public.

Having the minister take total control of information that he has not even paid for, on a basis which leaves the person or company that has provided the information with absolutely no say on what parts or sections of the information should be permitted to be in the public view, seems to us to be a gross invasion of the privacy of Ontarians, and therefore we're asking that this section be struck.

But we would be amenable if the government, through its legal counsel, has an amendment that would restrict the dissemination of information to information that's agreed on by both parties, or some such amendment. I'm not sure how to word it, or we would have tried to do it. But with the expertise the government has and the number of ministry staff the government has, I wonder whether they couldn't in some way limit the huge ministerial discretion that is provided for in this act.

We agree that it is useless and counterproductive to duplicate studies and to not share information. The difficulty here is that there is absolutely no control over what information may be provided to the public through the minister. I think Orwell would have some problems with that, as we do.

I'm asking the parliamentary assistant if he would not consider some kind of limitation on the minister's power to make public this sort of information.

Mr Len Wood (Cochrane North): I don't want to get into a lengthy debate, but we feel this subsection of the act is necessary for use of information in reporting to the public on forest planning. The information required by this section is already available to the public through the Freedom of Information and Protection of Privacy Act, with the exception of proprietary information. We moved an amendment to subsection 18(1) at the end of the day yesterday, that was adopted, which we feel helps to clarify along those lines. We will not be supporting the Liberal amendment to strike out subsection 18(2).

Mr Brown: If I understand the parliamentary assistant, he's saying this information is available in any case through the information and privacy act.

Mr Wood: The Freedom of Information and Protection of Privacy Act.

Mr Brown: That's why there's a process through the freedom of information and privacy act to ensure that an individual's or a company's privacy is not being invaded. Therefore we have a commissioner who looks very carefully at the freedom of information and privacy act's implications, what information can be disseminated. What you are doing here is taking that protection away from the public, taking the protection of the Information and Privacy Commissioner's office away from companies or individuals.

I'm not going to make any comment about recent events with the freedom of information and privacy act, but it seems to me that it's useful for government to protect the privacy of individuals, and we do know that the privacy commissioner will, if he finds that this information should not be in the public domain, make such a ruling. Why would the government want to circumvent the Office of the Information and Privacy Commissioner?

Mr Wood: We're dealing with crown land; we're dealing with public information. As I said in comments earlier, the province is the landlord of this and we feel this subsection is necessary for public participation in the crown land and forest planning, and reporting to the public on how the planning is taking place.

Mr Brown: The parliamentary assistant always refers to the landlord-tenant relationship in this. If I'm the landlord of an apartment building, I may require some kind of credit check on a tenant who may come in which might involve the disclosure of income, all sorts of private information. I would be in big trouble if I were to release that into the public domain without the consent of the tenant. I'm wondering why the government does not feel that it is in the same position, using your analogy.

We are not opposed to releasing information that is public information. The difficulty here is that the minister's the sole arbiter of what is public information. We have circumvented the normal legislative regime in Ontario for deciding what is public and what is private.

Mr Wood: I disagree with your interpretation. I've got no further debate on it.

Mr Brown: Is there a reason for disagreeing with my interpretation? You have obviously circumvented the freedom of information and privacy act. There's no question; that's what this section does. It gives the minister total discretion.

The Vice-Chair: The parliamentary assistant has indicated that he doesn't wish to debate it further. Anyone else who has any questions?

Mr Brown: He's raised an interesting point that I haven't really thought of. Maybe he hasn't circumvented the freedom of information and privacy act. If it becomes the minister's information, does that mean the Information and Privacy Commissioner will rule on any information that the minister chooses to divulge? I suspect the legal counsel's the one who can help me with that.

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Mr Doug Beecroft: I'd really like to look at the Freedom of Information and Protection of Privacy Act before I gave a definitive answer on that.

It certainly seems to me arguable that subsection 18(2) does not override provisions of the Freedom of Information and Protection of Privacy Act that preserve confidentiality of trade secrets and things like that. The Freedom of Information and Protection of Privacy Act generally makes government information available, but there are exceptions for trade secrets and personal information. It seems to me quite possible that those exceptions are still applicable to this kind of information, but I would have to look at the act to be more certain.

The Vice-Chair: Are we ready to vote?

Mr Brown: I think the issue is foggier than ever, Mr Chair. The government may prefer to stand this down rather than vote on it until we can get some clarification from counsel.

Mr Wood: No, I think we're ready to vote.

Mr Brown: "We don't want information, we want a vote." That's unreasonable, I think, but I'm not here to determine what's reasonable.

The Vice-Chair: It certainly wouldn't be in my power to determine that. Ready to vote, then?

Mr Brown: Recorded.

The Vice-Chair: A recorded vote. All those in favour of Mr Brown's amendment?

Ayes

Brown, Carr, Hodgson, Morin.

The Vice-Chair: All those opposed?

Nays

Duignan, Ferguson, Hope, MacKinnon, Wood.

The Vice-Chair: The amendment is lost.

There being no further amendment to section 18, is there further debate on section 18?

All those in favour of section 18, as amended?

Mr Brown: Recorded vote.

The Vice-Chair: A recorded vote. All those in favour?

Ayes

Duignan, Ferguson, Hope, MacKinnon, Wood.

The Vice-Chair: All those opposed?

Nays

Brown, Carr, Hodgson, Morin.

The Vice-Chair: Section 18 carries.

Mr Wood: I move that subsection 19(1) of the bill be struck out and the following substituted:

"Minister's report

"(1) The minister shall prepare a report on the state of the crown forests at least once every five years."

I think this is one of the motions that pretty well mirrors a Liberal motion as well as a Conservative motion, which is kind of interesting. I'm pleased that all three caucuses are on the same wavelength and pretty well agree with that amendment.

The Vice-Chair: Any debate?

Mr Brown: Just to indicate our support for this amendment, as it is very similar, if not the same, as our amendment to the same section; and to indicate that it is necessary to comply with the EA board's term and condition 84 and that this makes it consistent through the entire province, not just the part of the province that is under the mandate of the class environmental assessment.

Mr Chris Hodgson (Victoria-Haliburton): Obviously, we support the amendment.

Mr Brown: I have one more question now. In preparing this report, will it be that the report will include the state of all of Ontario's crown forests, that is, all forests on crown land, including provincial parks?

Mr Wood: By putting this into the legislation, we're committed to giving a public report on the state of the crown forests throughout the province. It's been recommended by all the environmental groups and by Peter Duinker, who came in front of this committee. When we're talking about the state of the crown forests, we're not really making a determination one way or the other in terms of drawing the line.

Mr Brown: So you're saying it would include all forests that are under the supervision of the crown, including provincial parks?

Mr Wood: What we're saying by this amendment is the commitment from the minister to the public to report on the state of the crown forests.

Mr Brown: You're avoiding me, I think. Does it include the provincial parks? I think you have to understand the reason we're concerned with this. If you get a report on the state of the forests and you define that forest in terms of the industrial forest, ie, the forest that's under the licence of various companies and/or individuals, it will give you a different result than if you include the protected areas of the province also.

Mr Randy R. Hope (Chatham-Kent): Try the definition of "crown forest" and you'll understand.

Mr Brown: I would like to understand, when you say, "I'm going to report on the state of the forests" --

Mr Hope: "`Crown forest' means a forest ecosystem or part of a forest ecosystem that is on land vested in Her Majesty" --

Mr Wood: As my colleague Mr Hope has pointed out, there is a definition under section 2 that defines crown forests and you're asking us to define it again here. As I said yesterday, there are a number of other acts that apply to provincial parks and I'm sure they will be amended as required, depending on how long this government stays in office and whether we're successful in achieving another majority government some time in 1995. I'm sure we'll be amending legislation as we go along to achieve the goals to the best benefit of the taxpayers of the province of Ontario.

Mr Hodgson: The parliamentary assistant, in his last remarks, summed it up. It will make the people of Ontario sleep better, is how I referred yesterday to that answer.

In section 4, where you exempt provincial parks, there's not going to be a report unless you change the parks act, is that what you're saying? I share Mr Brown's concern, that the people of Ontario should know the state of the forests inside the parks as well as outside the parks. They're all crown forests. But I also appreciate the parliamentary assistant's rationale that you have to change another act to do that. Hopefully, that'll be forthcoming and we won't have to wait for the NDP to form another government.

Mr Wood: Along the same lines, we're also looking at the concerns the Conservative caucus has about private lands and we're looking at some kind of template or blueprint to deal with that as well.

Mr Brown: I take it this legislation, in your view, just requires the minister to provide information to the Legislature on the forests that are under management or under licence to companies that are involved in timbering?

Mr Hope: No, it means crown forests. The definition applies --

The Vice-Chair: Mr Hope, you don't have the floor.

Mr Brown: I just want to be absolutely clear about what this says, because it makes a difference in the interpretation of the report when the report comes out. We're not talking about the 8% or 9% of northern Ontario's land mass that is now in a provincial park.

Mr Wood: What we are attempting to do here is to amend the wording as it is there now: "The minister shall from time to time prepare a report on the state of the crown forests." We're following exactly along the lines of what the Conservatives have brought forward, what the Liberal caucus has brought forward, in saying that the minister shall prepare a report on the state of the crown forests at least once every five years. There are other sections in the act which deal with what you're concerned about, Mr Brown, and we've dealt with them as we go along in amending the legislation.

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Mr Brown: So you're telling me that this would exclude the provincial parks?

Mr Wood: I'm telling you that this particular section is changing the words "from time to time" to "at least once every five years."

The Vice-Chair: We're probably ready to vote. All those in favour of Mr Wood's amendment to section 19? Opposed, if any? Carried.

The two other amendments, the Liberals' and the Conservatives' motion being almost identical, they would be out of order.

Any further amendments? Shall section 19 as amended, carry? All those in favour? Opposed? Carried.

Mr Brown: I move that section 20 of the bill be amended by adding the following subsection:

"Negotiations

"(2) The minister shall enter into negotiations with first nations that have communities in management units in respect of the matters referred to in term and condition 77 of schedule A to a decision of the Environmental Assessment Board released on April 20, 1994, in respect of the class environmental assessment by the Ministry of Natural Resources for timber management on crown lands in Ontario."

Again this amendment is to make clear that the legislation needs to be consistent with the class EA terms and conditions, in particular 77. It's put in place because we believe that the present section as it stands creates some confusion and perhaps some differences of opinion about whether the EA terms and conditions are being applied in the same manner

Mr Wood: We will not be accepting the amendment. We feel that the section as it is deals with what the class EA has said should be done. Section 20 provides the minister with the authority to enter into agreements with first nations where joint authority for management is desired, and we don't want to restrict the flexibility of the government to negotiate in the future. Relationships with first nations are evolving now, and section 20 states: "The minister may enter into agreements with first nations for the joint exercise of any authority of the minister under this part."

This is happening right now. It's happening with at least two bands in my riding, the New Post First Nation and the Constance Lake First Nation. The negotiations and bargaining back and forth are developing, and we're concerned that adding another section -- we shouldn't have to negotiate. We should be able to go ahead and work out agreements.

Mr Brown: The amendment is not attempting in any way to keep the government from doing that. It is just trying to make it consistent with what the timber EA said in respect to first nations. We think our amendment makes it clearer. If the government is happy, we can look for some time in court, I suspect. All we are attempting to do by this amendment is to make it consistent, which the government doesn't seem as concerned about as we are.

Mr Wood: We feel it is consistent and there's no need for a further addition to it.

The Vice-Chair: Any further debate on the Liberal amendment? If not, all those in favour of Mr Brown's amendment? Opposed? The amendment is lost.

Seeing no further amendments to section 20, shall section 20 carry? I'm sorry, you want to debate that?

Mr Brown: There has been concern raised, seeing as this section is specifically mentioned in the act, about whether the minister has authority to enter into negotiations and agreements with other entities aside from first nations. We heard from the hunters and the anglers, for example, suggesting that they perhaps would have some interest in some kind of partnership agreement, and I can think of many others that might conceivably in the future have some interest in the same area. Many of them would be non-profit groups: It could be the federation of naturalists, it could be -- the sky's the limit as you think about that.

The question I'm asking is, does the minister have authority to make other agreements, other than this one, with other groups, say, the Conservation Council of Ontario or whatever?

Mr Wood: This one deals with aboriginal first nations, and section 12 deals with your concern: committees and boards.

Mr Brown: Can I just look at section 12?

The Vice-Chair: In the meantime, Mr Hodgson had a question.

Mr Hodgson: I too will be voting against this whole section. I feel it's covered under section 5 of this act. "This act does not abrogate, derogate from or add to any aboriginal or treaty right that is recognized and affirmed by section 35 of the Constitution Act, 1982." As Mr Brown pointed out, there are other groups that would like to have joint agreements, and I feel if it's legitimate, it's covered by the act the way it's written under section 5.

Mr Brown: I've just had the opportunity to review section 12, and I cannot see in section 12 where those agreements can be made, unless the parliamentary assistant helps me. It says, "The minister may establish local citizens' committees to advise the minister on the preparation and implementation of forest management plans and on any other matters referred to the committees by the minister."

What it says to me is that the local citizens' committees, groups, whatever can provide advice to the minister. It doesn't say anything about --

Mr Wood: I believe section 12 was amended as well.

Mr Brown: Oh, good; now it's getting more complicated. Oh, you're talking about the functions of a forest management board, and you believe that would give the minister the power to make agreements with one or several or --

Mr Wood: There's flexibility there.

Mr Brown: I would have to agree with you on that.

I would just say to Mr Hodgson, though, that section 20 is required by the timber environmental assessment, which is the law of the land. I just make that point to him.

The Vice-Chair: Are we ready to vote on section 20? All those in favour of section 20? Opposed? Carried.

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Section 21: Any comments, questions, amendments?

Mr Wood: That's clear. There's no questions that I'd like.

Mr Brown: Well, we're not all speed-readers.

The Vice-Chair: Any comments? Of course, I want to give members a chance to read what they are voting on.

Mr Brown: An interesting concept.

The Vice-Chair: Are we ready to vote?

Mr Brown: I have a little problem with subsection (2), and I would like some clarification. It says, "The minister shall not enter into an agreement under section 22 or grant a licence under this part except in accordance with a competitive process." Could the parliamentary assistant describe the competitive process? Is it that I will pay more than Mr Mammoliti? Is that the essence of it, or is it a tender situation, or is it clarified somewhere in the regulations or manuals that I'm unaware of?

Mr Wood: Competitive: I would use the word fair.

Mr Brown: Is there a description of the competitive process anywhere?

Mr Wood: There were discussions when we were dealing with the manuals and regulations of present examples being used out in the forests right now. It is somewhat competitive.

Mr Brown: Yes, but the people, in order to make a competitive bid, have to know the basis of what the competitive bid will be evaluated on. If the normal tendering system for the province of Ontario requires a certain degree of openness and a certain degree of accountability in that tender, surely someone who is in a competitive process would like to know whether it is a 100-metre race or a 10-kilometre race before you enter the competition.

Could you tell us how those decisions are made? We're starting now to get into the real nitty-gritty of the bill: Who gets what. That is a cause of great commercial consternation and also a cause of great concern to not just companies but communities that are dependent on wood availability etc. Is the government going to spell out what they mean by "competitive"?

Mr Wood: Most people would know what competitive means. When you're bidding for something, you cannot restrict it to one particular person. If somebody else wants to get into the competitive business and get involved in it, it's an attempt to not be restrictive.

Mr Brown: Again, I think you have to be aware when you're getting into a competitive process what the goals and the specifications are that the person who's making the tendering is asking for. I think my question is critical. When we were in northern Ontario, for example, we heard people from Rainy River, a forest company, that was reasonably happy about a decision to locate a plant in Fort Frances; that's understandable. We then heard from Avenor, who were unhappy that their wood allocation had been given to Fort Frances or to the Rainy River organization.

Mr Wood: Because they didn't want to compete.

Mr Brown: You say they didn't want to compete, but that's exactly the question: What is the process? Avenor indicated that they weren't part of the process, weren't happy with the process. You say it was competitive, but one of the people who was involved doesn't know what the criteria were, doesn't understand. If it's just, "Who's going to pay me more for the wood?" that's relatively simple, but I don't think that's what you mean by "competitive process," is it?

Mr Wood: I don't want to get into a long debate on this, but as we're speaking right now there's an announcement being made in Timmins about sustainable forestry, sustainable jobs, and it was a competitive situation that is going to be good for the city of Timmins and the whole surrounding area. It's a process that has been going on now for about six or eight months, and it's finally come to the point where the press conference is being held at 11 o'clock this morning in Timmins to make the announcement.

The competitiveness is there, creating jobs, protecting jobs, protecting the communities and using the resources out there on a sustainable basis to better the people of Ontario and the communities we live in.

We've announced a new operation in Wawa. That's the first new operation that's been out there on the ground in 15 years, and it's all on a competitive basis: bidding and raising the dollars and saying, "We're ready to put the shovels in the ground and get this province back to work." They're competing on that basis. The banks are involved. Everybody's involved in putting Ontario back to work on a competitive basis.

Mr Brown: I understand that it's hard to discuss this in the abstract, and I'm perfectly happy that you've pointed out the situation in Timmins this morning so we have a concrete example. You could maybe indicate what the competitive criteria were in that situation so we could understand that; then we would have some very specific items we would know, that you went out and asked for proposals, and, "This is what we're looking for in those proposals."

Mr Wood: That was all covered through press releases over the last six or eight months. A message went out for proposals, that there was a surplus of hardwood, poplar and birch out there: "Let's see how it can be done to create jobs and protect jobs in some of these communities." This will be the fifth announcement that has been made on the use of poplar, and it's been on a competitive basis.

Mr Brown: How did you evaluate who was the winner? I would suspect you got a number of proposals for the use of this surplus wood. How did you decide that A was better B was better than C? That's really the question. On what basis do we make those decisions?

Mr Wood: I don't have that information with me, but it is public information. It was spelled out in detail in the request-for-proposals package that was sent out, as to what they should be coming up with to be the successful bidder. It was in public documents; it's public out there.

Mr Brown: You'll have to excuse the poor members of this committee for not having access to all those public documents.

Mr Wood: As the forestry critic, you got a copy in the mail, I'm sure.

Mr Brown: I'm sure I didn't. That's really not the issue.

Mr Wood: If you didn't get it, I apologize, because I'm sure you should have got it.

Mr Brown: I'm sure we did not get it. That's really not the point. There's another critic for Natural Resources here; maybe he got it, I don't know. But I'm sure the rest of the members of the committee didn't get it, absolutely sure.

The Vice-Chair: Mr Hodgson wants to speak anyway.

Mr Hodgson: I realize we're on a tight timetable today so I'll try to make my comments brief.

The parliamentary assistant opened up an area that I do have a couple of questions about. I didn't receive the criteria, but I trust it could be coming.

Defining a surplus: I assume what they did is said there's a surplus in poplar and aspen, but it was on the first licensee's licence and they had a plan for it to be used in their own factory to be built in five years' time. Under the old Crown Timber Act, you would have to negotiate with them, I understand, but under this act the minister could allocate that surplus to a third-party licence holder and then award the contract in press announcements of a factory someplace else. When you're mentioning the studies done on the surplus, is that public information, or has it been done yet, or are these announcements contingent on surpluses being found?

Mr Wood: No, the inventories out there have been identified, and there's enough fibre out there in other species that were considered to be a weed and were being bulldozed over the years, not being used. There's enough inventory out there to sustain these operations.

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Mr Hodgson: Let me be specific. We were in Fort Frances and there was a front-page story in the newspapers of a $100-million investment announcement for the forest industries. Had the forest surplus been identified to support that announcement, or is that announcement contingent on finding the surplus?

Mr Wood: I missed the last part of that.

Mr Hodgson: The surplus, if it exists, I would assume would be in a public document if it's been identified, or is that announcement contingent on finding the surplus?

Mr Wood: No, it's not "if" the volume exists. The volume did exist. You're not going to have a bank loan $100 million based on the fact that if we find something --

Mr Hodgson: That's what I'm asking. The announcement was there --

Mr Wood: The decision was made that it was there and as a result the financial institutions are coming forward and putting up the dollars to --

Mr Hodgson: So that study's public, to show where the surplus is for that particular factory?

Mr Wood: Yes, and it's available from the timber management plans.

Mr Hodgson: So the inventory's been verified.

Mr Wood: By the companies that are making the investments, yes.

Mr Hodgson: Who did that?

Mr Wood: I'm not sure who did it.

Mr Hodgson: I know who did it. You're sure that study's available?

Mr Wood: If I didn't have some security, Chris, in asking the bank to come out --

Mr Hodgson: I realize that. That's why I'm asking. It's a very important issue. It's very serious.

Mr Wood: The banks or the financial institutions have come forward with well over $300 million, I guess it's got to be at this point in time, in northeastern and northwestern Ontario for investing.

Mr Hodgson: Exactly, so they'd have to have documentation showing there's going to be a supply. Where's that supply coming from?

Mr Wood: A lot of it is coming from crown land; it's wood that's not being utilized.

Mr Hodgson: On FMAs held by whom, or crown units that are licensed to whom? When we were up there, there was a bit of discussion about this.

Mr Wood: The discussion is still going on. The negotiations are still going on. There are third-party --

Mr Hodgson: But the banks have lent the money and the announcements were made, but they're still negotiating with the licence holders?

Mr Wood: The companies that are making the announcements have commitments, have assurances.

Mr Hodgson: I realize that, but you said the timber studies are done but we're still negotiating with the licence holders for the supply. Have I been following?

Mr Wood: No, I didn't try to give that impression.

Mr Hodgson: So they're still negotiating for the supply, but the announcement and the commitment's there to invest that kind of money.

Mr Wood: The supply is there, the commitment is there for the money, and the shovels are in the ground and they're building.

Mr Hodgson: Granted, I'll give you that the trees physically exist, let's assume they physically exist, but you still have to go and negotiate with the licence holders to take those trees to another mill than the one the licence holder owns.

Mr Wood: They sit down together and work out agreements and then take it to the bank or the financial institutions.

Mr Hodgson: But that's just starting, that process.

Mr Wood: It's been going on for over a year, and as the agreements are put in place, announcements are being made jointly by MNR and Howard Hampton and the companies involved.

Mr Hodgson: So the announcements are made after the agreements are made, or have the announcements been made before the agreements have been worked out?

Mr Wood: No, the announcements are made after.

Mr Hodgson: After the agreements, so, for instance, in Fort Frances --

Mr Wood: There is a possibility of it happening and then there's the announcement that it will happen and it is happening.

Mr Hodgson: So whereabouts are we with -- the only one I'm really familiar with is Fort Frances, because we were up there. That announcement was made because the agreements have been made on where the timber's coming from to supply this new investment? Do you follow, Len?

The Vice-Chair: Mr Hodgson, I would remind you that you said you were going to be quite brief with your questions.

Mr Hodgson: That was a brief question but it was a long answer.

Mr Wood: I guess we could go on for ever, but everything is at different stages; there are different operations at different stages as we proceed. Spruce Falls has a licence and they're going to be starting up their sawmill in January; this has been under construction now for a period of time. Other ones are putting the shovel in the ground, other ones are just at the beginning stages. There are all different stages that are taking place.

Mr Hodgson: So was the Fort Frances announcement just a preliminary announcement that this is going to be looked at, or is this definitely going ahead because the agreements have been all completed for the supply?

Mr Wood: I'll have to phone a couple of people I know in Fort Frances to see what stage they're at right now.

Mr Hodgson: When we were out there it was clear in the local newspaper that this was definitely going ahead, or it seemed to be giving that impression that it was good for jobs, it was good for the area.

Mr Wood: Rainy River Forest Products had made an announcement and it was up on the bulletin boards in the airport.

Mr Gary Carr (Oakville South): I'm going to be very brief too, and it's on the same point. With Fort Frances, you talked about the banks, that money's out. I take it you've got to go back and look at that one because you're not sure. What we're getting at is that these announcements are being made, but have the banks actually transferred money in the Fort Frances case to the companies? Do you know? You said the bank's been out, the money's been loaned. Has the money been transferred to the companies yet?

Mr Wood: I don't know what their financial arrangement is, whether they pay the bills as they get them or whether they go out and give them a chunk of money to put into --

Mr Carr: That's what I'm getting at.

Mr Wood: I wouldn't even want to get involved in that financial part of it.

Mr Carr: No. What you're saying is that the banks have loaned. I trust they wouldn't, until they check the supply, actually transfer any money. That's what I'm getting at. They haven't done that, in my opinion. Quite frankly, you're making an announcement that -- let's be very blunt and honest -- is political, because the election's coming up. You're making an announcement.

Mr Wood: The one in Fort Frances was not a political announcement. It was made by Rainy River Forest Products. That was their announcement. They put it up in the airport, I saw it there, and --

Mr Carr: But we don't know what the supply is.

Mr Wood: -- they were doing a follow-up with the ministry after.

Mr Carr: Obviously, they want to make the announcement too, but what we're getting at is that there could be a problem in terms of supply.

Mr Wood: No, there is no problem in terms of supply.

Mr Carr: Okay. So the money's all been transferred, the banks have said, "Great, here's the money, away you go." No?

Mr Wood: You'll have to check with your bankers.

Mr Carr: Announcements are made in anticipation. I've seen over the years announcements made three times for hospitals. There's the announcement that it's going to be coming, another announcement, then the announcement when, to use your term, the shovel is actually in the ground. On the Fort Frances one, when are we going to see the actual shovel in the ground?

Mr Hope: On a point of order, Mr Chair: What does this have to do with the section we're making reference to? I'm just having a hard time understanding --

Mr Carr: The availability of resources is what this whole issue is about.

Mr Hope: It's dealing with the competitive process in the section that's being referenced to. I'm having a hard time understanding where they're coming from.

The Vice-Chair: Mr Hope, this is not a point of order. Questions are in order during clause-by-clause consideration.

Mr Hope: Pertaining to the section being referenced.

The Vice-Chair: Pertaining to the section, yes. They will pertain --

Mr Carr: Then I will reference. This whole issue is that the Fort Frances announcement is based on availability of resources. I'm asking the parliamentary assistant, when are we going to have the shovels in the ground, actually have activity? Do you know that?

Mr Wood: Yes. They're at different stages right now. Five announcements have been made --

Mr Carr: No, the Fort Frances one.

Mr Wood: -- but some of them are at different stages of construction as we speak. As I said, Spruce Falls is basically completing their construction. The one in Wawa, when I was there, they had cleared all the land and were putting in the foundations for the operation. They're all at different stages. Because announcements were not all made on the same day, some of the shovels are deeper in the ground than some of the other ones are.

Mr Carr: Specifically on Fort Frances. We heard Wawa, Spruce Falls very clearly. Just let me know, where are we at with Fort Frances?

Mr Wood: To my knowledge, there's no reason why Fort Frances will not be moving ahead and they will have a splendid operation there that will be making profit and creating employment and making the people of Fort Frances happy for years and years to come.

Mr Carr: But their shovels aren't, to quote you, "deep in the ground" yet?

Mr Wood: I haven't been to Fort Frances in the last couple of days.

Mr Carr: We'll just sum it up. I think we've gathered that what we've got here is that announcements are being made before -- and I appreciate that the parliamentary assistant is very confident they're going to be proceeding, and in the case of Spruce Falls they did. What I'm saying is that we're probably going to have an announcement and another announcement and another announcement as we go along, and that is done, in my estimation, for no reason other than political. But, as you see, in this particular announcement there is some concern because we can't get definite answers on it. I'm not going to belabour the point. I think we know where we stand with that, so we may as well just move on.

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Mr Brown: To speak directly to the concern I raised in the first place, which is the competitive process, I am aware of one proposal that the ministry called for, and I don't have it with me so I won't be able to go through it. It was the proposal for Thunder Bay, I believe. I believe we received a copy not from the ministry but actually from the Thunder Bay Economic Development Corp or some body like that.

I have two points. In that proposal -- and it struck me as a strange way to do it, but maybe not so strange -- one of the conditions of that call for proposals was that the proponent identify the wood supply. As you've described the process, the ministry would have declared the wood surplus and then I guess people would go out and make agreements regarding the surplus wood, but in this one it very clearly said "identify" the wood supply in its proposal.

Mr Wood: This is along the lines of Bill 171. It's to hold the companies responsible for doing some of the work.

Mr Brown: I won't pursue that because I'm not sure where that's going. But the second question I have is that we have heard a great deal about communities and about how this bill is not only to sustain the forest in an environmental and in an industrial forest sense, I take it, but also that it's to sustain people -- that means jobs -- and that it is supposed to sustain communities.

I'm wondering what the thought process in this competitive process is in terms of the Thunder Bay example, for instance, because it's the only one I've seen a call for proposals for; how it was determined that the call should be for a facility in Thunder Bay. Is it because the wood supply that the ministry has identified is nearer that community? Especially when we were in North Bay we heard a lot of people and communities come before us saying, "In order to sustain Wilberforce Veneer in Wilberforce, we need to have a wood supply." We heard people from Mattawa come before the committee and make the case for increased wood supply and what that would mean to the operations in their community in both the forest and the manufacturing end of it.

How does the ministry determine whether Wilberforce is the winner or Mattawa is the winner in this competitive process? If we're talking about communities and how that fits -- that's why we would be much more comfortable if you would define the competitive process so that we would know what in fact you mean. The way it is at the moment is that justice not only has to be done, it has to be seen to be done. This is not a very open process in terms of how competitive proposals may be evaluated. If you don't know what the yardsticks are, it's very hard to meet them. Our question is, how do you make those decisions?

Mr Wood: I'd be willing to sit down with you and discuss any complaints you have from any of the proponents out there on the bidding on it. Other than that, we could drag this on for days and days and days debating. As far as I understand, the proponents out there are quite happy that they're in the competitive business they're in. That's all I have, Mr Chair.

Mr Brown: I don't understand the reluctance of the government to define "competitive process."

Mr Hope: You've been asking him to name names. In the definition, the terminology is --

The Vice-Chair: Order, please. Mr Brown has the floor.

Mr Brown: Mr Hope is making my point for me.

The Vice-Chair: Mr Hope, do you want to be on the speaking list?

Mr Hope: It's redundant, what Mr Brown is asking.

The Vice-Chair: Okay, Mr Hope, I've put you on the list; you'll have an opportunity later on.

Mr Brown: I'll ask it this way, then. This is a policy decision, because obviously Mr Wood believes these to be policy decisions, not statutory decisions. Will the government indicate to us what the yardsticks are, the evaluation, the measurement of "competitive process"? What are they?

I'm not complaining or saying that you've done wonderful things. I'm not doing either. I'm only saying that I think the people involved in this business, involved in those communities, involved in working in the forest, would like some certainty about what process they're expected to be in other than the very vague term "competitive."

Mr Wood: And as I said about half an hour ago, Mr Brown, the details of that are in the package for requests for proposals. All the proponents had a package of that, and I was hoping both critics had each received a package on it. You're saying you didn't get it, and that's unfortunate, but details were out there, and I personally haven't had any complaints from the proponents. If you have had complaints, I think you and I should sit down and talk about it.

Mr Hope: Mr Brown is pretty adamant about this term "competitive process," I think what Mr Brown would want to do, with his background and talking about the northern part of Ontario and dealing with the woodlots, is make sure that the competitive process is one of an area competitiveness versus a written scripture that's in any process. If you're talking about being competitive, I think you would want the area to be competing in terms of receiving an opportunity, versus somebody from outside the community coming in and doing that process.

You're pretty adamant about the definition of "competitive process." Well, I was adamant when the Conservative government brought forward the free trade agreement and they started talking about, what does "competitive" mean? I got their definition: lean and mean. But they didn't tell me that, I found that out later.

When you're moving on the issue of competitive process, anything that is an open process of government you know has a yardstick attached to it, and the yardstick is attached on the definition of the community. I would believe that you would prefer that be the process. Now, I'm not 100% sure whether it was used in the ones you're making specific reference to, but I believe your terminology and what you're trying to get across is that the competitive process must be one that's reflective of a community. The definition of "community" then becomes another argument, but I won't enter that one.

But leaving it worded as it is, as Mr Wood has tried very hard to clearly indicate to you, is that the competitive process that was used in those areas which are now receiving the awards, in Thunder Bay and others, was one that has been through both sides of the community, opportunities for the community, and there is usually only one successful bidder in any process. But if you want further information, I'd recommend that you write the freedom of information and protection of privacy officer and ask him for detailed information about those specific bids you're looking for.

The Vice-Chair: I'd just like to remind everybody that we're at section 21.

Mr Brown: In responding to section 21 and talking about competitiveness and the competitive process -- just to make sure I made reference to it -- I think Mr Hope makes some good points. I agree. That was one of the things that was brought out particularly in North Bay at the hearings there, but in other communities also. There are other factors here than straight price. There are sometimes even other factors here than straight number of jobs created. There are sometimes questions of maintaining a family business that has been the heart of a community for 100 years. There are numerous conditions surrounding all these questions of wood supply.

What I'm concerned about really is, what is the government's policy? How can we articulate that framework? I don't suspect you can put in a list of things that would apply to every situation in Ontario, but I would certainly appreciate some kind of overall framework for knowing what the competitive process is: What will the government be considering, what will the minister be considering when he grants a licence to Mr Hope, or to myself, or to Mr Wood?

I can see we're not resolving this question satisfactorily.

The Vice-Chair: This would seem to me to be the case as well.

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Mr Brown: I'm wondering, though, if the parliamentary assistant could perhaps furnish the committee, at his earliest convenience, with copies of the call for proposals for the five projects that have been approved. Maybe we can discern from the practice what the process is, rather than the other way around.

Mr Wood: There's no confidentiality to that and I'm surprised you didn't get it already.

Mr Hope: It also gets to a consideration of section 22 of this bill, which is not currently law. Section 21 also makes reference to the Lieutenant Governor. It says, "The minister shall not enter into an agreement under section 22 or grant a licence under this part except in accordance with a competitive process." There is a law here, that has not been passed, for this new process versus the old process. It's just when you're making reference.

Mr Brown: I think the parliamentary assistant, however, is making the case that the process that has gone on in the five projects that have been approved to date will be the same process that is followed under this bill, Mr Hope, and I believe the Crown Timber Act provides for that. This act may in fact make that easier or more difficult, but it is the same process.

I have to indicate that we will be opposing this section, for the reason that the government fails to define "competitive process" at least in a policy framework.

The Vice-Chair: Are we ready to vote? All those in favour of section 21? Opposed? Carried.

Mr Brown: I move that subsection 22(1) of the bill be amended by inserting "for a five-year period" after "agreement" in the third line.

If you give me a second, I might be able to tell you why I want to do that.

The Vice-Chair: We'll give you a second, even two seconds, but not much more.

Mr Brown: Thank you, Mr Chair. You're so generous. I think our concern with this section is the same concern we have with regard to the former FMAs. We would hope there'd be an evergreen clause in this, but that there is some fixed date that could be changed if people aren't performing or whatever. Right now, you're granting those virtually for ever, without performance criteria. We're talking the management units, not the FMAs. It speaks to wood supply, utilizing the available wood supply and not having someone sit on it, so to speak.

Mr Wood: In this particular section, the intention is that we don't really want them to have to be five years. It could be less than five years or it could be more than five years, subject to approval from the Lieutenant Governor in Council. That flexibility should be there for the security of a community or of a facility. I know the area you're talking about, where you have 20-year agreements and they're out for public review every five years. In this particular area, we want the minister to be able to look at something in less than five years and also look at something in more than five years, or in between the five years and 10 years, for the security of a particular community or of a particular facility that is there.

We've been dealing with a lot of different communities. A week ago I was in Arnprior, where Tembec has taken over a Braeside operation. The concern there was to get somebody involved who is going to be able to supply some security to the community and use the resources from all around; eventually, as the trees grow, there might be further security in that community. But in the meantime, it's to be able to licence short-term or long-term or for a certain particular time. That's the section we're dealing with, and that's why we will not be accepting your amendment.

Mr Brown: Maybe you've helped me, because I didn't quite understand that in the terms you are putting forward. What you're telling me is that this would give you the flexibility if, on a particular unit, you wanted to let someone use it for a year because there's a surplus for a year; that you'll be able to make those rather flexible arrangements and that's really the need for the design of this section. I was reading it as a more long-term section.

Mr Wood: Yes. We have to decide what the long-term solution is for that particular facility, but in the meantime you can deal with it over a short period of time.

Mr Brown: Can you help me, then, on these one-year -- which I agree are necessary; I think it's a good idea and it's been done for a while. Who, in that case, provides for the forest management plan? Is that something the ministry will have done and determined? Mr Brown, who did hold the licence, is no longer interested, for whatever reason, and has given up his tenure on that particular unit, but in the interim we need to harvest the wood that is surplus, so now Mr Hodgson should do that for a year. But will he be operating under a forest management plan, which are drawn up for five years, that was mine, not Mr Hodgson's?

Mr Hodgson: What was that?

Mr Brown: I'm sorry. I just used your name totally out of context.

Mr Wood: He's got you building a paper mill somewhere.

The flexibility is in the act for the minister to be able to deal with those situations, Mr Brown.

Mr Brown: But after me, would the next person in there be operating under the forest management plan that was drawn up for a different company, whose goals may be quite different from mine?

Mr Wood: I think we'd have to get out on the ground and have some dialogue and discussion and resolve it there.

Mr Brown: So your answer is that this section is to grant the ministry the ultimate in flexibility in dealing with those aberrations in the forest in terms of commercial activity.

Mr Wood: Yes.

Mr Brown: Then I will withdraw my amendment, because I think it is actually not helpful.

The Vice-Chair: Any further comments on section 22? All those in favour of section 22? Opposed? Carried.

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Mr Wood: I move that subsection 23(1) of the bill be amended by inserting "renewable" before "licence" in the third line.

One of the concerns brought forward by a number of people was, what happens at the end of a five-year or 10-year or 15-year term on licences? The intention is that the licences will be renewable, and the word "renewable" is put in there. We got that message loud and clear during public hearings, and it's not the intention of doing otherwise than having them renewable. Currently, under the FMA evergreen policy, the intent is there, and for any new FMA terms negotiated by way of the Carman exercise the message will be given that it's intended to be renewable.

Mr Hodgson: As the parliamentary assistant mentioned, there was a great deal of concern as we travelled for the hearings. We heard from numerous parties who were concerned about the tenure. I just have a few questions of clarification.

I'm assuming that inserting the word "renewable" is addressing the whole issue of tenure. I'm not a lawyer to know whether or not that'll make those people feel comfortable with this section of the act. But in the parliamentary assistant's opinion and the government's opinion, is the crown's legal obligation regarding tenure, with the legal agreements between two parties, going to be the same under this new act as it has been under the Crown Timber Act? Are the legal obligations of the crown going to be the same as they were before this act was in, before the crown entered into an agreement between two parties for the right to use a resource, to harvest a resource? Are those legal obligations of the crown still the same respecting the tenure of the licence holder?

Mr Wood: In terms of the FMA agreements, some of them are in place and some of them have been converted over through the negotiation process of what we call the Bob Carman exercise. It is still continuing the negotiation process, and I know for a fact that they are dealing with tenure and they're dealing with security that comes along with tenure in creating jobs, protecting jobs and what they can do to help those communities. Yes, those negotiations are taking place.

As I said, right now the calls coming in have to line up the way I do when I go to get an airline ticket at Pearson airport -- I've got to pick a number and wait in line -- because the negotiations are moving along. They're dealing with tenure and --

Mr Hodgson: But with regard to tenure on an FMA, let's say, the evergreen clause will be continued because of this word "renewable," the obligations of the crown with regard to their tenure?

Mr Wood: The intention is that you're not going to take it away it from them.

Mr Hodgson: So you can't unilaterally take it away from them. Is that right?

Mr Wood: That's the intention.

Mr Hodgson: Okay. To follow up on that, under this new act will it be legal for a company to make an announcement on somebody else's renewable licence holdings? I'll just use a hypothetical example. If a company were to make an announcement of a new plant and new jobs using the timber supply off somebody else's limits, without negotiating with that licence holder, under this new act would they be able to make that announcement before they had the negotiations complete? Hypothetically. I'm not referring to going back into the Fort Frances situation.

Mr Wood: I'm not a lawyer or a legal person of that nature, but in my experience involved in the pulp and paper industry and the forest for the last 30 or 35 years, the negotiation process for the use of trees and wood and whatever is ongoing basically on a continuous basis in terms of who can make the best use of the wood that's out there to create jobs, protect jobs and secure the area.

As far as announcements are concerned, I would expect that the announcements would be made jointly. It's not everywhere where negotiations break down and we lose the right to be able to watch baseball on TV and things of this kind. Some places are successful in negotiations.

Mr Hodgson: That's right. So it wouldn't be legal for a surplus to be declared on somebody else's limits without their agreement to use that timber, by another company that doesn't hold the license to it, without a negotiation?

Mr Wood: Negotiations and dialogue, and then the eventual mediation and whatever.

Mr Hodgson: Would it have to be complete before the announcement was made under this new act?

Mr Wood: I don't particularly know what incident you're talking about.

Mr Hodgson: A hypothetical situation.

Mr Sean G. Conway (Renfrew North): Mr Chair, can I just ask a supplementary? I don't think there's anything hypothetical about this at all. There'll be people who look at this bill and say, "A new day." The member from Victoria's being very polite. I can be a lot less polite and say that for the last 125 years various departments, of Crown Lands and Natural Resources and Lands and Forests, have been, usually with the best of intentions, committing stuff they didn't have to give, overcommitting it, double-committing it, just one screw-up after another, usually with the best of intentions: Nobody wanted to convey the hard news. I'm just assuming that in this joyful new world that's not going to happen, because there's a powerful legacy of that in Ontario.

Mr Wood: I haven't heard of it happening in the last four years.

Mr Hodgson: Mr Chairman, did I get an answer to that question? Mr Conway summed it up in a less polite fashion.

The Vice-Chair: Mr Brown is next on the list. If you want to speak again you can come back to it.

Mr Wood: I thought I'd given you an answer. We're not talking about some phantom situations out there. We're talking about reality --

Mr Hodgson: Yes, a real situation.

The Vice-Chair: Sorry, Mr Hodgson. Mr Brown is next.

Mr Brown: We obviously are in support of the government's motion in this case. We did hear a great amount of verbiage and very strong concern about the tenure issue. Certainly, all holders of long-term licences or evergreen licences or agreements with the government expressed a concern that they may have made capital investments in vain, may have spent a great deal of forestry money only for someone else to come in and take their licence. I think adding this word will give at least some small degree of comfort to those people who have been on the evergreen licences and the communities that rely on the mills that are located depending on this wood source.

Having said that, we have been concerned from the beginning that the former Crown Timber Act defined the word "licence" but there is no such definition within this act, that I'm aware of. There is some concern that a licence is different from an agreement and that an agreement is not one that can be unilaterally cancelled as easily, perhaps, as a licence.

I don't know whether this is a valid concern or not, but the argument has been given to me on a number of occasions that licences and agreements may not be the same thing, that you may not be able to go to Queen's Bench and appeal the fact that someone has taken the licence away because it was the minister's prerogative to give it or not give it, but if you have a binding agreement with the province of Ontario and you were treated in an unsatisfactory way in your view, you could take legal action in court.

I don't know whether that's a valid concern or not, but certainly that has been expressed to me by a variety of people in the industry who believe that the word "licence" rather than "agreement" may in fact reduce tenure, and that is not what they're interested in. Would you see the licence and the agreement as the same, and why have you not chosen, as the Crown Timber Act does, to define the word "licence"?

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Mr Wood: Before a lot of discussion was involved and before the negotiations with Bob Carman, I think there might have been some concern out there, but I don't believe the concern is there right now. What we're talking about is a transition period and converting over, and I believe the people who were raising the concerns understand now that an agreement and a licence is the same thing.

I guess we could interpret what the word "agreement" means, interpret what the word "licence" means. I have an agreement with the Ministry of Transportation that it will give me a licence to drive.

Mr Brown: And you make a large capital investment in a vehicle so you can do that, I'm sure.

I would have a far higher degree of comfort, and I'm certain many other people would, if you would choose to provide the committee with a definition of "renewable licence" in the act itself.

Mr Wood: It is defined.

Mr Brown: It is? Where?

Mr Wood: Under the definitions.

The Vice-Chair: While you look that up, Mr Brown, perhaps Mr Carr could take the floor.

Mr Carr: My question is a follow-up to what Chris was talking about, in a case like that. The parliamentary assistant said that between two parties there could be a lot of negotiations, and I think he used the word "mediation." At the end of the day, is it the government's intention to make a final arbitrated settlement? Can they basically dictate and say, "This is what's going to happen"? In the case Chris mentioned, is that what we're going to see probably happen?

Mr Wood: In the event that there is no agreement --

Mr Carr: The government will impose one?

Mr Wood: -- mediation will take place to try to come to some kind of agreement.

Mr Carr: And that would include, I take it, financial compensation as well?

Mr Wood: I'm sure they're going to be talking about the whole situation of that. We have situations all over Ontario that are different.

Mr Carr: At what point would the government step in and impose a settlement? I take it that it would be when they've reached the point where both parties say, "We can't get an agreement," that the government would then impose one probably at that point? They wouldn't do it until they knew that both parties had said, "We can't go any farther."

Mr Wood: There are some situations where one community can actually be shut down because there can be no agreement reached on a third-party agreement. If that agreement were reached it would not affect the supply or the tenure for the other community for 100 years or 200 years or 300 years, but just because there is no agreement one community has to say, "We have to shut down and bulldoze our whole operation and basically move a town." We're saying that mediation is probably a better solution to that to work it out.

Mr Carr: But in any settlement, there would be financial compensation to that party, notwithstanding the fact -- you're saying there would be financial compensation?

Mr Wood: I'm not sure what the end result of the agreement would be. When I start collective bargaining, I don't know what the end result is going to be.

Mr Conway: Those are really vital questions that I think need to be understood. I haven't been part of this process, but I do know that the question, as has been indicated, of tenure is absolutely critical. I think people understand out there today that it's not going to be like it was 25 or 50 years ago, although it is interesting, for example, to talk to licensees who went through the Algonquin Forestry Authority Act of 1972 -- in retrospect, I think good public policy. But I'm going to tell you, people's sense of tenure at that time -- what they had and what they got were not necessarily one and the same thing.

I just look at the amendment, I look at the sections, and if you read 23 together with 31 and 35, if I'm sitting there in Smooth Rock Falls or in Bancroft, Ontario, and I'm going to make an investment, boy, I'll tell you, I still think I'm open to some pretty considerable discretion.

Mr Wood: I know that some people haven't followed the committee all around over the last month, but the concern was that if we didn't have the word "renewable" in there, there might be the intention to cancel licences or not renew them. Our intention is to submit the "renewable" in there so there's no misunderstanding and no concern for the people who came in front of the committee and made presentations. We're responding to their requests to bring forward amendment. I'm sure most of them are going to be quite pleased with the word.

Mr Conway: So it's the view of the government and the department that the amendment will strengthen section 23 in a way to give a higher level of comfort to people out there who clearly are concerned about the tenure question.

Mr Wood: Yes. The concern was: "We're not worried about this government, but what if we get another, terrible government in there? We've got to have some protection in the legislation."

Mr Conway: This government's been at work in my area doing some things that I don't think are all that -- I mean, they're tough. You mentioned Braeside. I think the Braeside decision was a good decision, quite frankly. Your minister made a decision around Algonquin park that was significant and had an impact on the tenure question.

I'm listening to the rhetoric and I'm looking at the language and I know the culture in the department. I guess I'll just have to wait and see.

The Vice-Chair: Have we waited long enough for the vote?

All those in favour of Mr Wood's amendment? Opposed? Carried.

Mr Brown: I move that subsection 23(1) of the bill be amended by striking out "the crown forest" in the second-last line and substituting "those forest resources licensed".

The Vice-Chair: Did you want to comment?

Mr Brown: As soon as I figure it out, I will. We are again concerned, and repeat the concern, that a licensee without the means nor necessarily the expertise is being asked to manage the forest rather than the resources of the forest, which I think the parliamentary assistant agrees are two different things.

We maintain, as we have maintained over the period of this bill, that this is a timber bill and no dressing it up changes that. This is just a further part of our effort to make it clear that that's how we see this bill. We don't see any problem with seeing this bill as a timber bill. I think the government might be proud to call it a timber bill, but the government shouldn't be very proud to call this a sustainable forestry bill.

That is the essence. We think licensees have a responsibility to manage directly for the resources they are licensed for and to take those other values into consideration, but we don't believe government does not have a role in ensuring that the other values are taken into account. That's as carefully as I can make that argument, which I've made umpteen times before.

We are concerned that there's no "sustainable yield" section in this bill. We are trying very hard to make sure that the government understands that somewhere down the road there has to be timber there. We're not very convinced, given the greatly diminished regeneration and silviculture budget of this government, which has placed huge demands on the industry in terms of dollars, in terms of process, in terms of contribution now to the provincial treasury directly through the residual value tax --

Mr Wood: You should have listened to Preston Manning going after Chrétien this morning, talking about spending.

The Vice-Chair: Mr Brown has the floor.

Mr Brown: We are concerned that this is just not possible in the real world.

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Mr Wood: Up front, we're not prepared to accept the amendment. We do not want to go back to the old timber act and deal with timber as timber only. We would like to deal with the sustainability of the crown forests and not just with the one species we feel this amendment would address; it would be addressing only the trees that are licensed for harvesting. We want to do the whole crown forestry, so we'll be voting against this amendment.

Mr Brown: No. What you want is for a private company to become responsible for the sustaining of the forest in and of itself, managing for values that it may or may not have any expertise in. That's what you want. It is just not very likely that that's to happen in a significant way. What you want is the ministry to withdraw from this process in a huge way, turn it over to the private sector, charge the private sector more money for doing what it's doing already, through increased stumpage, increased area charges, a residual value tax.

Let's be clear. You are increasing the costs to people by about $100 million in 1994-95, and we are going to get less regeneration and less silviculture. Those are your own numbers. Those aren't my numbers, they're the ministry's numbers. I don't understand how anybody can claim that an increase in charges but a decrease in actual activity in the forest is sustainable. But I'm sure we'll disagree about this for, virtually, ever.

Mr Wood: The only comment I would make is that the budget called for, I believe, $189.1 million over 1993-94 to be spent on renewing the forests out there; along those lines, we're saying the job is being done. We're not going to accept this particular amendment, for the reasons I've given earlier.

Mr Brown: Let me just help you. We start with silviculture achievements. These are the government numbers generated by yourself: silviculture achievements and silviculture expenditures. I don't know whether you have this, but it was circulated, I believe, to all members. If we use the total amount of money spent on silviculture starting in 1984-85, $73.8 million was spent. Then it was $92.6 in 1985-86, in 1986-87 it was $103.4 million, in 1987-88 it was $108.9 million, in 1988-89 it was $113.8 million. In 1989-90, the last full year of the former government, it was $118.5 million. Then it was $122.4 million in 1990-91, six months of you guys. Then it started to decrease: in 1991-92 it was $119.6 million, in 1992-93 it was $97.4 million, and in 1994-95 the expenditure, which will now be financed out of your renewal funds, totally out of stumpage fees, is $109.6 million. At the same time, in terms of stumpage and area charges we have gone from charging $59 million in 1984-85 and will be charging $104 million in 1993-94.

This is sustainable? You picked one of the lowest numbers in silviculture practice and regeneration in recent years and chose to sustain that lower number and at the same time increased the charges to the industry, the people I represent and the people Mr Conway represents and the people with communities in the crown forest represent, increased the charges to them by a huge amount of money while withdrawing government support for that. And that's going to be sustainable in the long term, you believe. I have great difficulty with that.

The Vice-Chair: Are we ready to vote? All those in favour of Mr Brown's amendment to subsection 23(1)?

Mr Brown: Recorded.

The Vice-Chair: A recorded vote.

Ayes

Brown, Carr, Conway, Hodgson, Morin.

The Vice-Chair: All those opposed?

Nays

Duignan, Ferguson, Hope, MacKinnon, Mammoliti, Wood.

The Vice-Chair: This amendment is lost.

The Conservatives have an amendment as well?

Mr Hodgson: Yes. I believe it's an amendment so reasonable that we can probably get it passed before lunch.

The Vice-Chair: Another one of those friendly amendments?

Mr Hodgson: It's a friendly amendment that is strictly in keeping with the rhetoric of selling this act to the public. The only change I've got from the present wording is that in the current section it specifies what activities are necessary to provide for sustainability, and that's renewal and maintenance, and I think that's got a bias towards just a timber component. I'll read in my amendment at this time.

I move that subsection 23(1) of the bill be struck out and the following substituted:

"Sustainable forest licences

"(1) The minister may, with the approval of the Lieutenant Governor in Council, grant a licence to harvest forest resources in a management unit that requires the licensee to carry out activities necessary to provide for the sustainability of those forest resources licensed in the area covered by the licence."

I'd like to point out why this is such a friendly amendment and why it's consistent with everything else in this act. It doesn't limit the activities necessary for sustainability to just renewal and maintenance, and it doesn't limit the role of third-party licensees for different resources on one area of land. It calls for the licensee, no matter what the resource he's licensed for, to carry out all the activities necessary to provide for sustainability.

I believe the way it's written right now could be interpreted by some as just a continuation of the old concept that the forest ecosystem consists of only trees. This is a recognition that there are more resources than just trees, and that this act is progressive and is going to take into account the whole forest ecosystem in regard to sustainability. Therefore, I feel it's a very friendly motion and hopefully before lunch we can make that so it'll stand up for future generations so they can all enjoy the forests.

The Vice-Chair: I don't think we'll be able to decide that before lunch, but I'm sure we'll find out at 2 o'clock whether or not it is a friendly amendment. I would like to remind the members that when we come back at 2 o'clock we'll have three hours left. We're at section 23 and there are 86 sections in the bill.

The committee recessed from 1159 to 1405.

The Vice-Chair: Everybody is almost on time. That's nice to see. This committee will continue its clause-by-clause consideration of Bill 171, and as we left this morning, we were trying to establish whether Mr Hodgson's amendment was a friendly amendment. Any further comment?

Mr Wood: I think he was looking for an answer, and we're saying that the amendment brought forward by the PC caucus is not acceptable.

The Vice-Chair: So it's not so friendly. Mr Brown wants to speak on it.

Mr Brown: Over lunch, I've forgotten the reasons Mr Hodgson proposed this amendment, so maybe he could remind us.

Mr Hodgson: Do you want me to go ahead, Mr Chair?

The Vice-Chair: Briefly, if you can.

Mr Hodgson: It might be hard to do -- this is a very complicated subject -- but I'll endeavour to do it.

Under the present wording of the act, it species what activities are required to provide for sustainability, and it mentions renewal and maintenance; I think that's in reference to the timber component of the forests. My amendment leaves it open that they have to carry out activities necessary to provide for the sustainability, and it doesn't limit it just to renewal and maintenance. It's consistent with what the government wanted.

The Vice-Chair: Is that clear now, Mr Brown?

Mr Brown: It is. I now recall what intervention I wished to make. I think that is an important consideration to put forward. As we discussed this bill during the hearings, as you recall, on many occasions I raised the concern about what ecosystem we wanted to maintain in the forest, and whether when we were doing regeneration activities or silvicultural activities we were attempting just to replicate what had been harvested or, as Mr Hodgson puts it in this amendment, actually achieve some sustainability of the resource.

In some cases, that will not be simply replicating the forest that has been harvested. In many cases, that forest will have been harvested once before and the regeneration activities on it may not have been what they should have been, and we may in fact wish to improve the forest -- maybe "improve" is the wrong word -- bring the forest back to what it would've been if the second cut had not been. I think Mr Hodgson's amendment, while not perfect, moves us along that route, and therefore we will be supporting it.

Mr Wood: Whether it's the first cut, second cut or third cut, we're not even sure what was there 5,000 years ago. With that, we're not supporting the Conservative motion.

Mr Brown: The parliamentary assistant's comment is well taken. We understand that we may not know what was there 5,000 years ago, but there has to be some consideration of what we want to be in that forest not only in the immediate future but for the future, depending on the species, from 50 to 100 years from now. That is what Mr Hodgson is trying to suggest to the parliamentary assistant, and that may be different from what was actually harvested in the area immediately.

We've been asking for the government to come forward with some suggestions of how it was going to make those silvicultural decisions about what kind of forest needs to be generated there. So far, those haven't been forthcoming, but Mr Hodgson is making a valiant attempt to move the government in that direction.

The Vice-Chair: Are we ready for the vote? All those in favour of Mr Hodgson's motion?

Mr Brown: Recorded vote.

The Vice-Chair: Recorded vote.

Ayes

Brown, Carr, Hodgson, Morin.

The Vice-Chair: All those opposed?

Nays

Ferguson, Hope, Jamison, Mammoliti, MacKinnon, Wood.

The Vice-Chair: The amendment is lost.

Section 23: Are there any further comments, questions? Ready for the vote? All those in favour of section 23 as amended. Opposed? Carried.

Section 24: Are there any questions, comments?

Mr Brown: This is the section that permits what is now known as DCLers, for example, Mr Wood? That's what this is about, the smaller, generally relatively short-term experience, so it's not a sustainable forestry licence or whatever jargon you use for that? This is the small, independent fellow who's out there trying to make a living in the forests of Ontario? I notice that you do have the five-year limitation on these kind of licences. Why do you require that here, where you didn't in the section before?

Mr Wood: There was need for flexibility in the other area, and there is not the same need for flexibility under this particular section where you're talking about other licences.

Mr Brown: This one requires more flexibility than the other one, is what you're telling me, and therefore you're going to restrict its term but you don't restrict the one that needs less flexibility.

The concern here is a concern we've had for a long time with regard to these licences, and that is how the regeneration, renewal and maintenance activities actually occur here. There has been a great deal of discussion, particularly by the small independents, about how they will in fact be able to do that. Subsection (3) provides for the ministry to enter into agreements with the licensee but doesn't require that. I'm just wondering how the government envisions those agreements to work.

Mr Wood: In fairness, Mr Chair, there is no amendment brought forward to this section by any of the three caucuses.

Mr Brown: Mr Chair, it is traditional that we get some explanation of why a clause is in the bill, or rather, isn't. We have the opportunity to vote for or against any clause in the bill and traditionally people want to make some kind of argument for having it, otherwise one would presume they don't need it.

This a critical issue. We heard from one end of the north to the other and down into Renfrew and Victoria and Haliburton counties people who were -- I think in Thunder Bay one presenter claimed this particular bill would put him out of business. All we're trying to determine is how these renewal agreements, which were a cause of great concern to these small independents, would work, to be able to assure them that they are not going to be put out of business because they don't have the expertise to make the plans or to carry out the silvicultural activities etc.

So I take it we're not going to get responses to questions about sections?

The Vice-Chair: Unless I hear any.

Mr Brown: I wasn't really asking you, Mr Chair. I was kind of hoping the government might want to defend its own legislation or at least explain it.

The Vice-Chair: I don't hear any answers, so --

Mr Brown: I don't either.

The Vice-Chair: Are we ready to vote on section 24?

Mr Brown: If we don't get answers, we'll probably be needing 20 minutes to think about it and go consult with other people.

The Vice-Chair: I don't hear any answers. Are we ready to vote?

Mr Brown: We'll probably have to talk about it for 20 minutes.

The Vice-Chair: Probably?

Mr Brown: We'll ask for 20 minutes.

The Vice-Chair: You're asking for 20 minutes. Okay.

The committee recessed from 1416 to 1436.

The Vice-Chair: We're now ready to vote on section 24. All those in favour of section 24? All those opposed? Carried.

Section 25: Any comments, questions? If not, all those in favour of section 25? Opposed? Carried.

Section 26: I understand Mr Hodgson has an amendment.

Mr Hodgson: I move that the bill be amended by striking out subsection 26(1) and substituting the following:

"Harvesting limit

"(1) A forest resource licence that authorizes the harvesting of forest resources is subject to the condition that the forest resources shall be harvested from the area described as available for harvesting in the applicable forest management plan."

I feel this would be an improvement on the present act. The difference is that the present act states the amount to be harvested and what I'm talking about is the area. Just as an example, if you issue a resource licence that authorizes the harvesting of an amount and the estimate on the volume in that area is out -- I understand that in some instances we do it on a 20-year inventory and sometimes there's a huge margin of error on the estimates.

The prescriptions for the forest management plan should relate to the area, not to the volume taken. You could take the volume in a very small area if the guess is out, so it should be a condition that the forest management plan should relate to the whole area under licence. Is that clear?

The Vice-Chair: Clear enough to me. Any reaction or any comments?

Mr Wood: Briefly, our feeling is that this amendment is not acceptable because the proposed motion would not support the changes in licensing that are species-specific and where more than one licence occurs on the same area.

Mr Brown: I have a concern; maybe Mr Hodgson could help me and maybe the parliamentary assistant also. I understand what Mr Hodgson's saying in that the estimates are not exactly always what they should be and given the particular terrain etc it may not make sense not to finish a harvest. On the other hand, the flip side of that is that the timber harvest could have been underestimated; in other words, if you only describe area, maybe there isn't that much timber on it, and then you would be restricted from moving to have the volume you need to operate the mill the way you may have wished. I don't know if that's a legitimate concern, but it may imperil the livelihoods of some mill workers if that is the case.

Mr Hodgson: I've thought about Mr Brown's concerns. Right now, if you get a licence based on the volume and it's not there, you're out of luck, as I understand it. If you want to go to another area, you have to get another licence. The calculation of the maximum allowable depletion should be based on the area control rather than the volume control. The volume control does not provide incentive for good utilization of the timber and does not provide incentive to maximize production on an onsite through intensive forestry practices. This is a concern we heard quite a bit at the public hearings, especially from the Ontario Lumber Manufacturers' Association.

I think it would be an improvement. I don't think it takes away from third-party licences or from licences for allocation of different species, and I think it would provide an incentive for good utilization of the timber. I don't know how much more I can talk on that. It seems to be fairly self-evident to myself and to others in the industry.

Mr Brown: I agree with the concern that's being raised. Again maybe we need some help from the parliamentary assistant on this, but it's my understanding that you can get amendments to your licence to suit that specific situation if it does occur, but more than that, that most licences usually have a plus or minus in them of a certain amount; for example, you can harvest 10% more or 10% less than the volume that is designated to take into account that exact problem. I wonder if that is being considered.

I think this is a good attempt to solve a very real problem. I'm just a little concerned about whether it is the proper mechanism, and would like some assurance from the parliamentary assistant that this kind of situation can be resolved.

Mr Wood: In a particular area, we have to make sure we're consistent with the area and the volume available or we don't have sustainability in accordance with the timber management plan or TMP. I hope that clarifies it a little bit.

Mr Brown: The way the section reads without being amended, it says you won't exceed the amount but there would be some variability to the amount; you wouldn't be absolutely precise in the amount but there would be some variance because, goodness knows, the forest varies. I understand that's the present system and that the present licensing generally does have some variance, to take into account that you can't go into a particular area and harvest all but 10% of it, because now you've hit your volume limit and that means that next year you'd now have to go up a road for 50 miles to harvest one very small, little bit of timber. That would not make sense in terms of sustainability and it wouldn't make economic sense, in any event.

But I'm wondering if there would also be some problem with just defining area that we maybe don't foresee. The real question then is, what variance can you get to your volume limits, and will the ministry take this into account when it's doing the planning process?

Mr Wood: The margin note for this section says "Harvesting limit." The intention is that we make sure there's a sustainability of resources there and that we're not going to be able to go way over. We had technical briefings at the beginning in Sault Ste Marie and I believe this is the explanation that was given at that time as well.

Mr Hodgson: As long as there's an assurance that if the estimate is totally out of whack and you reach your volume, but the plan for sustainability for that whole area calls for the culling of certain trees, for example, that can be taken into account; if you're confident, along with the staff, that good forestry practices -- that there's an incentive we've built into it to make sure you do what's set out in the plans if the volumes are totally out of whack.

Mr Brown: I think we who are from the area recognize the fact that the knowledge of the forest isn't quite similar to going down to Bay Street and being able to enumerate the buildings. Forests do vary from place to place and most of our information is average-based; by doing small samples we assume that an area will contain a certain amount of timber etc.

We want to know that we will have both good sustainability practices in terms of culling, for example, as Mr Hodgson says, or to regenerate a unit in an economic way, which wouldn't mean leaving 5% or 10% of the timber standing, just because it would never be economic to go back in and get it.

All we're asking is that there are mechanisms within the bill to take those kinds of variances into account in terms of sustainability, and that it can be done in an expeditious manner; people don't want to wait for six months for the ministry to approve the change in plan.

Mr Wood: The answer is yes.

The Vice-Chair: Ready to vote? We're voting on Mr Hodgson's amendment. All those in favour of Mr Hodgson's amendment? All those opposed? The amendment is defeated.

Mr Brown, you have an amendment.

Mr Brown: I move that subsection 26(2) of the bill be struck out.

This amendment is really being placed just so we can have this discussion and try to understand the rationale for exempting areas less than 25 hectares. Presumably, those areas would be within a forest management plan of somebody. Would that not be the case?

Mr Wood: Yes, probably. The section we're dealing with is a small exemption for 25 hectares or less, for licences up to a year. Fuel woods, poles, timber for mines, things of this kind -- I guess you've been following the press clippings that have come through. We have one in northeastern Ontario, and his argument is, "I planted the first tree in the reforestation of northern Ontario and now I'm having a hard time getting timber to put into a mine." We think this will address that concern, and we're not going to be accept the suggestion that it be deleted.

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Mr Brown: I didn't really expect you would. I was really just trying to understand this section, in that I would have thought it would be probable, at least, that the area would have been within a forest management plan.

Mr Wood: Fifty percent of the crown forests are under FMAs, roughly that.

Mr Brown: But the crown units that are licensed would be under a forest management plan under this bill.

Mr Wood: We have to go back to the technical briefing again. I'm just trying to jog my memory on the explanations they gave in that briefing. There are far north and far south areas that are outside of management units.

Mr Brown: But in the normal course of events, in probably 90% of the areas we're discussing by this, there would be a forest management plan there anyway because under this bill the ministry probably would have been the one that drew it up, I would presume, because it would probably be a number of small DCLers, or whatever we call them under this act, and crown unit management, not FMAs. The ministry probably would have had to provide the plan for that management unit in any event, even though the allocation on that 25 hectares didn't go to a particular place and you're giving that to somebody for a year or whatever.

My concern here is that if you get a number of these in a row, it is conceivable that you don't have any kind of regeneration plan. I don't have a big problem with exempting 50 acres or 60 acres or whatever that is, but it seems to me that if you have quite a number of those that are continuous, you could have a problem and it could have been very feasible to have a forest management plan.

Mr Wood: I've heard your argument, but --

Mr Brown: It doesn't cut any ice.

Mr Wood: Your argument is not the case. We're talking about exemptions rather than that this is the way we're going to plan Ontario.

The Vice-Chair: Any further debate on section 26? We'll move to the vote on the amendment by Mr Brown. All those in favour of Mr Brown's amendment? Opposed? Lost.

Any further comments on section 26? All those in favour of section 26? Opposed? Carried.

Mr Wood: I move that the French version of subsection 27(4) of the bill be amended by striking out "du bois d'oeuvre" in the third line and substituting "d'arbres en bois d'oeuvre."

Sorry about my pronunciation. I think it's self-explanatory. Maybe the Chair wants to repeat it so we have it correct for Hansard.

The Vice-Chair: Does anybody want to debate this?

Mr Hodgson: I'm not sure I caught the significance of that. Can you explain that, Mr Wood?

Mr Wood: This is a technical change that has been brought forward by the translators and we felt it was important that it be corrected at this time.

Mr Hodgson: I'll have to defer to that expert opinion.

The Vice-Chair: We're ready to vote? All those in favour in favour of the amendment? Opposed? Carried.

Section 27: All those in favour of the amended section 27?

Mr Brown: Mr Chair --

The Vice-Chair: I'm sorry. Do you want to talk about section 27?

Mr Brown: Normally the Chair would ask if there's any discussion.

The Vice-Chair: Okay. Is there any discussion?

Mr Brown: This section really requires our trees to be manufactured in Canada, but that we can export for fuel, building and other purposes. I don't understand the "building" part of it. What will we be exporting a log for building for, if it wasn't to be made into lumber? A log cabin, perhaps? Is that what we're talking about?

Mr Wood: I don't recall the exact explanation our technical people gave in Sault Ste Marie. The explanation was there in Sault Ste Marie when they covered it, and I'm sure we could dig back into Hansard and resurface that explanation given during the technical briefing.

Mr Brown: Frankly, I don't recall it being made, and I don't have a copy of Hansard with me. Chris, do you remember?

Mr Hodgson: Yes, I believe log manufacturers that assemble homes.

Mr Brown: So it is for the log home, but they are manufactured when they leave.

Mr Hodgson: No, they're just cut out in the forest. You can have a roundlog home.

Mr Brown: All right, I understand now.

The Vice-Chair: Are there any further questions?

All those in favour of section 27, as amended? Opposed? Carried.

Section 28: Mr Hodgson, you have an amendment.

Mr Hodgson: I wish to withdraw this motion. My understanding is that it's covered --

The Vice-Chair: We don't need any discussion if there's no amendment.

Mr Wood: I move that section 28 of the bill be amended by adding the following subsection:

"Effective date

"(2) A determination under subsection (1) may be made to apply retroactively to April 1 or any later date in the year in which the determination is made."

What we want to do is try to have a common date, reduce some of the confusion for licences. It'll allow the stumpage system to respond to market conditions, that prices for forest products are fair and equitable, and these provisions are similar to those used in the Crown Timber Act right now.

Mr Brown: I know members, by reading it, would be quite surprised, but this is really about the residual value fee. This is the residual value tax. It's never mentioned anywhere.

Mr Conway: Say it again, and say it slowly.

Mr Brown: Residual value tax.

Mr Conway: The Reaganites used to call those things revenue enhancers.

Mr Brown: These people call them fees.

Mr Conway: It's pretty unvarnished. The Liberals used to call them taxes and we were vilified for it.

The Vice-Chair: Mr Brown, are you finished?

Mr Brown: No, I was a little --

The Vice-Chair: Sidetracked.

Mr Brown: Sidetracked would be a good word.

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Members should look at page 3 of the responses I have received from the ministry in regard to this innocuous section, at least as it's written, regarding residual value tax. In 1995, the pulp sector is expected to pay only $82,000 -- "only," I say, but that sounds like a lot of money; the veneer sector $2,670,000; the sawmill sector $56,418,000; the OSB sector $4,159,000; the paper sector $2,812. I presume these are based on the fact that the market stays at about the level it is.

That is an extraordinary amount of money, and our view is that if the government is happy to be collecting that, the government should be prepared to put it back into forestry. We believe this money should be dedicated to the forests of Ontario through the renewal fund and through the futures trust section and dedicated to that. The reason, as we all know, is that Ontario's forests certainly could stand a little sprucing up, so to speak.

Mr Conway: I could use pine, actually.

Mr Brown: Pining up; all right. There is a lot of remedial work that could be done in our forests, and the renewal fund and the futures fund could both well spend this money. It would be a help to the northern economy and it would be a help to all forestry communities to have significantly greater revenues being spent in them or spent on them; it would provide a great deal of work. In the futures fund aspect, I will be placing an amendment later on that would permit the futures fund to spend some money assisting in research on forestry, as has been suggested by people like Lakehead University, that this would provide a funding base for them.

The problem is that this section is written in such a way that we can't figure out how to make that amendment. We are almost fearful of making that amendment because it may seem that we are therefore in favour of this residual value tax, which we are not.

But that's the problem, and I wonder if the parliamentary assistant or someone could help us in terms of how we might dedicate this fund to trusts that really do need extensive funding. As I pointed out, silviculture funding in this province will be down $20 million or $30 million below its peak years. We would hope that the ministry could augment that through this fund.

We think it's reasonable. It's coming from the forests of Ontario. The government is already collecting at this point, according to its schedule, I think a dollar a cunit for administration, going, over five years, to $2 a cunit for its own administrative purposes. I think that's probably legitimate, for the ministry to be collecting money for its administration, but this is no more than a tax that flows to Queen's Park and will never been seen in the forests of Ontario again. It will be taken out of the northern economy and placed in the southern economy.

Mr George Mammoliti (Yorkview): What do you mean, that money won't be seen in the community again?

Mr Noel Duignan (Halton North): Just like the tire tax.

Mr Brown: That wasn't a good idea either.

Mr Conway: I beg your pardon. I can defend the tire tax.

The Vice-Chair: Mr Wood has the floor.

Mr Wood: Mr Brown is making an argument on section 28, but the motion I made that we're talking about is a date in addition to section 28, which would be subsection 28(2). We're talking about "A determination under subsection (1) may be made to apply retroactively to April 1 or any later date in the year in which the determination is made." This is the motion I made that I want to debate and then vote on.

Mr Mammoliti: I just would like to ask Mr Brown how many Jobs Ontario grants he's gotten in his community over the last four years. Any at all?

The Vice-Chair: Your question does have to have a link with section 28. If your question makes some sort of link with section 28, perhaps I could accept it.

Mr Hodgson: I hate to interrupt a discussion between the Liberals and NDP about how to tax the people of Ontario more, or who taxed them more or who is going to do less. This is quite consistent -- a retroactive tax grab -- with other ministries in the present government.

The Vice-Chair: If we could stay on section 28.

Mr Hodgson: Section 28(2) deals specifically with the current practices in other ministries of making tax grabs retroactive. I just wanted to help the parliamentary assistant with that clarification.

The Vice-Chair: Are you ready to vote?

Mr Brown: No. I'm just coming back to the fact that I would find it rather difficult, if I were in Mr Wood's position, to be defending a government that is out there claiming this is a crown forest sustainability bill when it is actually projecting to spend less money on silviculture. The only thing they're planning to spend more money on, to be clear, is administration, and that should, in this day and age, make someone think a little bit.

As you look at the fees they've generated, they are considerable. In 1990 the province was receiving in total, between area fees and stumpage charges, $85 million, and in 1993-94 they're expecting almost $105 million, an increase of $30 million in two years -- absolutely astounding. The Treasurer should be very happy with the minister for being able to pull that kind of money out of an economy.

Our concern here is that there's no limit. This is an absolutely open-ended, retroactive charge, with no accountability to the Legislature, period -- zero. The minister may just decide at any point that he may and change it. Recent events would make anybody in that business quite nervous about any government, not just yours, having that kind of power without legislative review.

Mr Wood: As I said before, the amendment we're talking about is that it would be retroactive to April 1 or to a later date in the year in which the determination is made. That gives some flexibility to the minister to say, "Based on the prices that are out there, it could be retroactive to April 1 or it could be to a later date in the year in which the determination is made." We're talking about dates.

Mr Conway: Again I apologize because I have not, like my learned friend from Algoma or others like the member from Victoria, been following this all the way through. But this is a very interesting section, and it touches on two major policy questions, as I see it.

One of them has been a big part of the softwood lumber debate over the past -- what? -- six, seven years, where our American friends said that Canadian provinces have essentially been subsidizing resources by virtue of undervaluing the price at which they're put on the market. I think that's essentially the way in which that argument has been advanced.

Second, I've heard from a number of people in the province over the years that the old mechanism by which crown timber was sold was a very imprecise one because, as I indicated in here the other day, it essentially put bologna and filet mignon on the market at comparable prices, or so it was argued.

My question to the minister or perhaps any of the staff is that I run the Acme Lumber Co in Four Corners, Ontario, and I have a licence -- I might have a DCL or I might have an old licence -- and can somebody just explain to me in a sort of Dick and Jane way how, by virtue of the application of section 28, this new order, broadly speaking, will differ from the old order? I think I know the answer, but I'd like to get sort of a summary of -- it's not a question that I necessarily expect the parliamentary assistant to answer, but maybe somebody from the staff. I have a feeling that members in constituencies where there are crown timber resources to be marketed are going to have to know the answer to this question soon.

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Mr Wood: As I had said earlier, we had a day of technical briefings explaining everything section by section in Sault Ste Marie, and the answers to your questions are probably in Hansard.

Mr Conway: And I understand that.

Mr Wood: I don't have a copy here, but it's available to you. What my motion is referring to is what the dates should be. We're saying we would like to have it as close as possible to April 1, either on a retroactive basis or a later date in the year in which a determination is made. We're talking about a date --

Mr Conway: No, I understand that. I'm really speaking to the main --

Mr Wood: As to the other part, I'm sure you can get your answers in Hansard because it was explained in Sault Ste Marie.

Mr Conway: But I'm a member of the Legislature, I'm here today and I have the section in front of me, and I think it is only reasonable that -- and Mr Cleary, I know, is here.

Mr Brown: I found that it wasn't earlier on.

Mr Conway: This is a very major question. A big part of this whole fight over the last seven or eight years has been, "You're giving it away, you're undervaluing it," and some of my friends on the left would probably maybe even have agreed with that previously. And there's another argument, which is the one I advanced, that the old mechanism was imprecise in its ability to calibrate the different values. I want to be clear as to how this is now going to work, broadly speaking. I'm serious. I expect to have some people on my doorstep soon asking for an answer, so it's sort of like a bit of self-preservation here.

Mr Wood: The whole intention of the negotiations that are going on right now with the better business relationship, the whole of Bill 171, the Crown Forest Sustainability Act, and the whole concept that is happening on the crown forests out there right now are intended to address the concerns you've raised that other governments have had to wrestle with. It sounds like we're not finished wrestling with it if the articles in the newspaper are true that the United States government -- not government, but the people there are going to continue the harassment of our people in Ontario and across Canada.

Mr Conway: I understand that and I appreciate the answer.

Mr Wood: But we're hoping this bill is going to address that, as well as the other things that are happening.

Mr Conway: It's clear to me what the intention is. "The minister may determine from time to time the prices at which forest resources may be harvested or used for a designated purpose under a forest resource licence." It's very clear to me what you intend, and given some of the past history I think that's an understandable section. I just need to know how it is going to work.

Again, I'm president of the Acme Lumber Co at Four Corners, Ontario; I have a licence. The old method basically is pretty straightforward, and I think I know how that works. Now, I look at this section and I know that it's going to change.

Mr Mammoliti: It would be up to the minister.

The Vice-Chair: Mr Conway has the floor.

Mr Hope: He's not even on the section that's being amended.

The Vice-Chair: Mr Conway is asking questions clearly arising out of section 28.

Mr Conway: It's almost not fair to ask this to the parliamentary assistant; I'd expect an answer from an ADM or director, because it's at that level. It is important. This is more a market-pricing mechanism, clearly, and I understand that and I think there's a good policy argument for that. I'm just trying to get my head around how it's going to work.

Mr Wood: The new pricing system deals with prices by sector, and the information's out there. I don't have it at my fingertips right here and I haven't memorized it and I haven't memorized the manuals.

The Vice-Chair: Mr Wood, it's been suggested that perhaps you might want to draw on the help of the ministry officials, but of course that's up to you.

Mr Wood: The technical briefing was done in Sault Ste Marie to the complete committee and it's available in the copies of Hansard.

Mr Conway: But the great advantage of committee is that we've got staff here, and when this comes back to the House in the fall I don't want to be wasting your time or the time of the committee of the whole on this. That's one of the joys of committees, that you get a chance to talk to the staff.

Again, broadly speaking I know what the policy objective here is, but I'm just trying to get around my head how it's going to work for somebody who is now, has been and will be in the business of buying, basically, crown timber.

Listen, if it's an unfair question, I'll back off, but I tell you, it'll be a question that a lot of elected members --

Mr Wood: In the motion I made, we're talking about the effective retroactive date, April 1 --

Mr Conway: I understand that, and that's not my concern. My concern is --

Mr Wood: There is no amendment to the other section that you're concerned about.

Mr Conway: I'm just dealing with the section as a whole.

Mr Wood: If I had known there was going to be a concern, if somebody had brought forward an amendment, we would have had the explanation here for you.

Mr Conway: But this is, to me, in terms of the resource policy --

Mr Wood: I thought it was clear and understood or somebody would have brought an amendment forward.

Mr Conway: The language of the section is clear and I think I understand the policy objective. I don't mean to be argumentative. I'm just trying to understand the mechanism by means of which this is going to be applied, because I've got a whole bunch of licensees and I know as their member they will say to me, "All right, how is it going to work?" Is there anybody at all --

The Vice-Chair: Mr Conway, of course that would have to come through the parliamentary assistant. I suggested that earlier to him, but he wishes to give the answer himself.

Mr Wood: You're asking for a briefing on the pricing, of how it's going to affect all the licences in your area.

Mr Conway: No, no. I was in another committee, for example, the long-term care committee, where "the following objectives" are outlined by the government and then there's quite a little debate next door about instruments; in fact, most of the debate is around the instruments, not about the policy objective, where I think there's general agreement.

I just look at this as a very major issue in the resource economies of Canadian provinces. I think I know what the government's about here and I'm not necessarily complaining about it, but boy, I'd sure like to know just a little bit about how it's going to work on the ground. Because I'm sitting there now, I have a licence and I've got a mixed bag: I've got some high-value red pine, I've got some low-value aspen, I've got some medium-value basswood, I've got some -- you know. It's priced now in kind of a grab-bag.

I think what you intend here, clearly, is to make sure that as Her Majesty sells off her high-value yellow birch or maple or red pine, Her Majesty is going to get full compensation at the time that material is taken off the crown lands, that there's not going to be kind of a general averaging. I think that's what you're going to do, but I'd just like to know.

Mr Brown: Nobody knows for sure.

Mr Wood: Some of this discussion took place during the debate in the Legislature on second reading of this bill, as well as one budget bill for sure and possibly another one, on the trust funds that are being set up, the pricing structure, and how a certain percentage of it was going to go into the trust funds. This debate has been taking place --

Mr Conway: I understand that, Len.

Mr Wood: -- and if you want a technical briefing on how it's going to affect each one of your particular licences --

Mr Conway: No, no. I don't want that.

Mr Wood: -- the different species, the different sectors --

Mr Conway: Somebody once said that all politics was local, and I guess all I'm trying to get is some sense of just how this thing is going to distil as a practical matter, how the new regime is going to work. Let's say for the purposes of this argument that I am a licensee anywhere -- your part of the province, my part of the province. I've got an old order that I know is passing. This is a vital question because this deals with the value of the resource. The public policy that we're seeing here is that the government, I think understandably, is saying, "We are no longer going to sell off valuable crown resources at anything other than what we think is a good market value at the time." I've got a licence where now I've got all this stuff and it's kind of a rounded average. I'm trying to figure out how this new scheme is going to work.

The Vice-Chair: I think the question's quite clear, but --

Mr Will Ferguson (Kitchener): Well, Mr Chair --

The Vice-Chair: I'm sorry, Mr Mammoliti and Mr Hodgson have been waiting.

Mr Ferguson: He's better-looking than me and he's got more hair.

The Vice-Chair: I will put you on the list, Mr Ferguson. Perhaps while the parliamentary assistant is thinking about answering the question, we can pass on to Mr Mammoliti, and if you come up with further questions we can come back to you, Mr Conway.

Mr Conway: Sure.

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Mr Hodgson: I have a point of order, Mr Chair. We're discussing, I believe, an amendment on the floor, and the discussion revolves around the actual clause. Is that in order?

The Vice-Chair: Certainly, the implications of the amendment do affect section 28.

Mr Hodgson: How?

The Vice-Chair: The issues Mr Conway raised certainly relate to the amendment.

Mr Hodgson: I would love to participate in a debate on the whole clause.

The Vice-Chair: Mr Mammoliti.

Mr Mammoliti: Mr Chair, just in terms of clarification, I'd like to know whose amendment this is before I go on.

The Vice-Chair: The government's, Mr Wood's.

Mr Mammoliti: The government's amendment. I'm just having a hard time understanding where Mr Conway's coming from in terms of what he's looking for. He's not looking for a briefing. He wants a question answered. It's my understanding -- and Mr Conway of course will tell me if I'm wrong -- that you will probably vote opposed to this motion anyway, seeing that they've pretty much voted opposed to most of the motions brought forward by the government. I'm wondering whether an answer would make a difference at this point in how he would vote. That would be my first question, through you, Mr Chair.

The second point is a suggestion; that is, that there really isn't anything stopping Mr Conway, or anybody else for that matter, from perhaps writing a letter on behalf of his constituents to the ministry and asking for some clarification, even after the vote is over. That's been done before. If it's that important to his constituents or anybody else's, that could of course be answered through a letter. That's a suggestion I'd make as well.

Mr Hodgson: If we're discussing the whole bill, you will recall that I withdrew an amendment that would answer Mr Conway's question indirectly. It doesn't have anything to do with the Acme Lumber Co at Four Corners or the owner, Mr Coyote. It has to do with the essence of the pricing of our resource. The people of Ontario own the trees.

My amendment that I withdrew stated, "The minister shall prescribe the size, form and quality of types of primary forest products and determine from time to time the prices at which forest resources may be harvested." I withdrew that because under existing and future legislation there are acts that govern the pricing, and there are staff people here who know that. What's been lacking in the province of Ontario is the political will to do it.

It becomes more clear-cut in areas like Renfrew and Haliburton-Victoria that you should have, if I can use Mr Conway's analogy, the baloney from the high-quality filet mignon or whatever; really, we're talking about veneer and butt-end logs and middle logs and things like that.

Up in the north, it becomes difficult because you've got this whole concept of chippers, and the pricing we receive, the scaling or the measurement of that wood, is done after it's chipped up, by weight when it goes to the mill. We set a stumpage fee of $7.50 on a cubic metre for pulp and $11.50 a cubic metre on sawlogs. This goes to the heart of what we heard throughout our public hearings in the north. What Mr Conway's getting at is, is the ministry going to change how that's done or is it going to continue that? If Mr Wood wants to answer that, that's fine.

My understanding was that they could've changed it under the past or the present or the future things that administer this pricing, so I withdrew my motion because it really depends on political will and has nothing to do with the act per se. If Mr Wood wants to correct me on that, that's fine.

The Vice-Chair: We'll give him a chance later on. Mr Ferguson is next.

Mr Ferguson: From time to time I think collectively as a group we're accused of not being able to see the forest for the trees. I think this is an excellent example of why.

Mr Conway asked a question. It's obviously a logical question and there's a logical answer for the question. Can we ask, through the parliamentary assistant, could somebody undertake to get Mr Conway the response to the question? That being done, perhaps we can move on.

The Vice-Chair: Well, that question has been posed.

Mr Conway: This is really important, because you get in places like my area, but there are lots of other places now, where you could actually have an allocation, a licence, where a substantial amount of what's on that licence has effectively a negative value. Everybody in the room and everybody around with the community advisory group would probably say you want some good harvesting of that but it's got a negative value, and because of various trading agreements there are certain things you'd like to do that you probably can't do to help subsidize that.

So the way in which this section is going to work becomes really important, because the objectives which everyone wants to be met are going to be very much affected by the instruments. The member for Victoria is right in saying that when you get into northern Ontario you get a very, very different kind of forestry and forest practice from what you get in middle Ontario.

No doubt, I suspect there's a lot more to this than anybody in the government, any government, is probably going to want to admit, because this is an issue that's been litigated in Washington and a variety of other places that has enormous consequences. If it can be shown that we -- and we did: I guess it's all over now, and we kind of won the last round. But if you followed any of those deliberations, very clearly the argument has been made that some species in particular, the high-value species especially, have in fact been undervalued and that if you put them on any kind of free market they would command a much higher price. In fact, when you see a free market operating alongside the controlled market of the old Crown Timber Act you could see it; it was plain as day.

The member for Yorkview says, would it change my vote on this? It's really not the issue. The issue is that the government has decided on a policy that I understand; I may not agree with it in all respects. I just need to know, how is it going to work? The objectives may be very laudatory, but, I'll tell you, you could subvert those objectives by choosing instruments which just don't work or in fact contradict what you want.

I'm no expert on this sort of stuff, but again I'm just trying to imagine somebody sitting across from me saying: "I'm a licence holder now. Here's the way it works. I understand the new rules." It's like that graduated driver's licence one, when somebody comes in and says, "These are the objectives of the graduated system." Here's this one: "These are the objectives. We agree. I know how the old system works. How's the new one going to work? How are you going to make it work in Kenora? I agree with your objectives but" -- you know? It's that kind of question. How do we, broadly speaking, imagine the new scheme is going to work? If it can't be answered, listen, it can't be answered.

The Vice-Chair: We'll give Mr Wood another chance.

Mr Wood: Most of the answers you're looking for, Sean, are covered under the way the trust funds are being set up, the way the reforestation is being done. They were set up in the budget bill that was brought forward in June that had third reading. In addition to that, we can set up a briefing in your particular area, if you have concern with your sawmills, your licensees, or we can bring our technical people forward to give you a brief answer.

Mr Conway: Believe me, I'll have to take that, but my question is, as this bill proceeds and will pass, presumably -- I mean, we are members of the Legislature and we are expected, irrespective of how we vote on a given question, to understand what it is we voted on. Some of it's very complex, and again I think it's almost unfair to put the parliamentary assistant, who is a very fine fellow and has worked very hard -- quite frankly, I think Howie is not being fair to the parliamentary assistant putting him in this position. This is a question that should be answered by an ADM. It's a technical question, but it touches on some of the fundamental policies that work in this bill.

Mr Wood: And they were answered in the technical briefing in Sault Ste Marie.

Mr Conway: But we're now at clause-by-clause.

The Vice-Chair: Mr Wood, Mr Conway's asking for some sort of briefing now, but it's up to you whether you wish to call the ministry --

Mr Wood: I've offered him a briefing in --

The Vice-Chair: That's clearly not what Mr Conway's asking.

Mr Conway: But is there nobody in the room that could come forward simply to speak to this?

The Vice-Chair: Mr Wood is not calling on them, I guess. As Chairman I cannot force him.

Mr Conway: But I just want to be clear. I know some of the people here; they're very estimable people.

Mr Wood: We have Mr McGowan who can come forward. We're looking for a short response that will satisfy Mr Conway.

Mr Conway: You understand my point. I'm the licensee --

The Vice-Chair: I think we had the question made quite clear. Mr McGowan.

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Mr Dave McGowan: I'd like to say that I do understand the question but I'm not really sure that I do. Are you asking what system we have in place now as a function of the budget bill?

Mr Conway: No, no. I know the system, what I will call the system pre-Bill 171.

Mr McGowan: So you're asking me to speculate on what system we'll put in place if Bill 171 passes?

Mr Conway: I'm being asked to vote on a key section of a very important bill that seeks to put a new order in place, and the section says, "The minister may determine from time to time the prices at which forest resources may be harvested or used for a designated purpose under a forest resource licence." I am a licensee. That's one of the most fundamental issues in the life of my business and the life of my community. So with all due respect, as we say in Parliament, I would like to know what it is I'm buying in this poke.

Mr McGowan: As I understand the current policy, we are negotiating and have been, through the exercise commonly known as the Bob Carman exercise, with the forest industry to develop a new stumpage system. I believe you have referred to components of that when you use the term "residual value tax."

The system that has been negotiated with the industry is based on determining a price for the product with a minimum fixed stumpage rate, which is a flat rate, and then determining a base cost allowance, which is in effect the set of costs the industry incurs in producing the end product, then determining a mill gate selling price for that product and determining from that a residual value. The system would then determine at what point on the residual value curve -- ie, as market price increases, the residual value in theory increases if base cost stays constant. You would then determine at what point on the curve any added fee would be implied to the stumpage system.

Mr Hodgson: Thank you very much, sir. I have just one quick question, but I have a comment before that.

What Mr Conway's referring to is that some species of trees have a negative economic impact but they should be, for good forestry practices for sustainability, of the economic value for that unit. I'm speaking not in northern Ontario but in eastern and central Ontario. Does the government have anything envisioned in the Algonquin area, for instance, which is covered under this act, in the crown units in our area for a new pricing arrangement to take into account that if you do it on the competitive bid, which you do, people will bid a high price for the veneer and then you can't pay somebody to go in and sort that bush out when they're done so there's value for the next generation?

Are there changes contemplated? Will there be changes in the way the pricing's done as a result of passing this bill, or, as in the briefings we were told earlier, is it that we're going to deal with the large FMAs first with the new business arrangement and then work down into eastern and central Ontario?

Mr McGowan: The issue of trees which you're terming as having a negative economic value becomes a silvicultural issue.

Mr Hodgson: Exactly.

Mr McGowan: My sense is that at this point the price of timber would remain the price of timber and the silvicultural issue would be dealt with separately.

Mr Hodgson: That's what I was trying to get at in my amendment to section 26 on the silvicultural practices, that the prescription should be based on the whole area, not on the volume of wood taken out. That's more specific to our area, speaking of eastern and central Ontario, than it is to northern Ontario. Do you see any changes on that now that my amendment was struck down?

Mr McGowan: I would suggest that would come under the auspices of part IV of the act, forest operations and operations prescriptions.

Mr Hodgson: So it is envisioned that that will be addressed. Thank you.

Mr Conway: Given the answer, I'm just sitting here trying to digest -- that's quite an answer, and I will look at it very carefully. What you're basically saying is that it's subject to the completion of the negotiations around the Carman exercise, right? I take it those negotiations are not yet complete.

Mr Wood: We've announced some of them. Some of them are completed and other ones are not complete yet, and we're not going to give away the last chip on the bargaining process.

Mr Conway: No, but again -- this is a very interesting way to do legislation. This is a key question and at some point people are going to vote yea and nay on this proposition. It's probably not going to be a big issue in Yorkview, but there are about 25 electoral districts where it's going to be important, because people are going to be asked at some point to give an accounting of what it is they voted for or against, so I always like to know something about what it is I have assented to or voted against.

The Vice-Chair: I think that's fair.

Mr Conway: And important, in this case. In that area Mr Hodgson refers to, I'm looking at an area roughly from Pembroke up to Sault Ste Marie and down to Haliburton, that big part of sort of east-central, midnorthern Ontario where the silvicultural issues are really important in terms of what a lot of this bill wants to get at, and pricing. For example, in my area you've got one of the great forests of the continent that has been high-graded, and you know what's happened. I'm sitting here trying to understand how this pricing mechanism might work in a situation where you have very substantial amounts of low-grade material, and there's just thousands of hectares of it in my part of the province. The way the pricing mechanism, as you've described it, is likely to work is that there'll be kind of a core value to the timber and then the silvicultural practice and cost issue is going to be calculated above and beyond that, or below that?

Mr McGowan: I think what you have to recognize is that the price for the timber is a separate issue than the issues of silviculture in that we would establish a fixed minimum rate, and then the prices above and beyond that relate to the end product that is made from the wood. If the wood is low-value or low-grade to the point where there's no end product, then the wood generally is not harvested.

Mr Conway: You see, the policy objectives of the ministry would be, and quite understandably so, that we want stand improvement, we want to clean this up. But the problem has been for years that whether it's a community forestry group or the Acme Lumber Co -- I might add for the sake of argument -- that did a lot of the high-grading, neither of those groups is going to be able to do much because they're going to be faced with the situation where the stuff isn't worth anything. I mean, it has a negative value: To get it the hell out of there, somebody's going to have to pay me money.

Now, we all agree it should come out. Good silviculture practice would say get it out or take a lot of it out, clean it up and let the good stuff grow again. I'm trying to understand how this mechanism is in fact going to deal with that, because if that's not done in some more creative way than it's currently being done, a lot of the very good objectives that the ministry has here I don't think are going to be achieved.

Mr McGowan: Yes. What I'm trying to say is that that won't be a function of how you price timber; that will be a function of how you do your silvicultural prescriptions and will be more related to part IV of the act under forest operations.

Mr Wood: Thank you very much, Mr McGowan, for coming forward. I'm sure that explanation is going to give us the support we needed on our government motion, which is to talk about April 1 or another date as may be determined by the minister. I have no further debate on that.

The Vice-Chair: Are we ready to vote on this amendment?

Mr Brown: No. I just wanted to ask Mr Wood to be precise about this particular amendment and why it's necessary that we have this. This is retroactive yearly, but my understanding about residual value taxes and all that good stuff, from your perspective, was that at least in the present system it rolls: I think every three months there's evaluation and you're paying kind of always three months behind, but it takes account of the market price and the stumpage that is paid today. The minister already has the power to determine the price unilaterally. Why do we need something that's retroactive?

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Mr Wood: The fiscal year is from April 1 to March 31, and April 1 is of particular importance in doing a lot of the business that the government has to do. At the same time, there is also the determination that you're going to limit everything to that particular year, that you can do it on a retroactive basis or you could do it at a later date, the next one, possibly within that particular year, to limit it to one year.

Mr Brown: What you're telling me is that this is bookkeeping?

Mr Hodgson: It's a retroactive tax.

Mr Brown: That's what I thought it was.

The Vice-Chair: Mr Hodgson, you don't really have the floor.

Mr Wood: It says "at a later date."

Mr Brown: Why doesn't this say 1994, then? Aren't we just worried about the retroactivity --

Mr Wood: Somebody might not amend this legislation for another 50 years.

Mr Brown: But how often does it have to be retroactive?

Mr Conway: Be suspicious. There's usually more than meets the eye.

Mr Brown: Yes, that's what I'm being suspicious about.

Mr Duignan: You should know that.

Mr Conway: I've done this; you're absolutely right.

The Vice-Chair: Any further questions or comments? No further comments? All those in favour --

Mr Brown: Recorded, please.

The Vice-Chair: A recorded vote. All those in favour of Mr Wood's amendment?

Ayes

Duignan, Ferguson, Hope, Jamison, Mammoliti, Wood.

The Vice-Chair: All those opposed?

Nays

Brown, Conway, Hodgson, Morin.

The Vice-Chair: The amendment carries.

Mr Brown: I move that section 28 of the bill be amended by adding the following subsection:

"Payments to trusts

"(2) A percentage determined by the minister of the price charged for a forest resource shall be paid to the forest renewal trust and the forestry futures trust."

I think I explained the reason before. What we're hoping to do is to provide some more forest renewal in Ontario. We have a considerable amount of money coming into the province: In the neighbourhood of $63 million will be coming in through the residual value tax, and it seems obvious to all of us, as we see declining silviculture budgets, that perhaps more of it could be spent in the forests of Ontario productively. Mr Conway suggests that maybe this would be a good place to be spending some money on taking out those trees with negative value and improving the forests in that part of the world, and there would be other important things to do, perhaps in areas devastated by forest fires in the past.

It would provide money. It is coming from the forest industry, from the forest products, from the forest workers, and therefore it would seem to me that this would be a very useful use of the fund, for it to go to the renewal trust and go to the futures trust.

The second issue is that later on, we will be making an amendment to ask that the futures trust include a provision for forestry research, as suggested by Lakehead University and others. I'm nervous that within the present forestry futures trust, which is funded solely by area charges, half the area charges I believe, there isn't money available in it for that particular additional use, and the province of Ontario should be assisting in developing better forestry practices, perhaps better strains of trees. Who knows what could be done if we augment our research and development program?

We believe this would be a better use of the funds than the consolidated revenue fund, that the people who contribute to this fund would at least see direct value coming from this fund. To oppose this measure would be to say, "It is in essence what Mr Brown says it is: a tax, not actually a fee."

Mr Wood: Let's be clear and straightforward. You want to have section 28(2) deal with trust funds, and trust funds are dealt with in part V. In particular to the issue you raise, the bill provides for forestry futures charges in 48(4) and forest renewal charges in 46, and what we're talking about in section 28 is prices. We're not talking about the setting up of trust funds. They're covered. The bill provides for each type of charge to be specified, and separately. We shouldn't be dealing with those areas you have concern about under subsection 28(2) at all; we should be dealing with them under the trust funds. You want to deal with the trust funds under the wrong section, and I won't be accepting the amendment.

Mr Brown: That explanation is rather odd. This is the only section that speaks about the residual value tax. It's the only way we can direct the money to the set-up of the funds.

As the parliamentary assistant well knows, these funds should already be in existence; they were authorized by the Legislature some time ago. We don't need to refer to any section in this bill for those trusts to be in place. We are only directing money to the trusts. We are not trying to establish the trusts. In a later amendment, at the appropriate section, we will be trying to direct some of the moneys to the trusts. This in no way affects the trust except for the fact of directing the residual value tax to the trusts rather than to the consolidated revenue fund. That's the issue.

I think this is appropriate. We could ask legal counsel if this is the wrong section to do it in, but I would think it's probably the proper section to do it in.

Mr Wood: The only comment I have is that I disagree with you.

Mr Mammoliti: Agree to disagree and let's vote.

Mr Brown: Let's be clear. Are you disagreeing with me because you don't want to dedicate any of this money to the trusts, or is it because it's the wrong section that I'm trying to amend and you will support an amendment doing the same thing to the trusts when we get to that section?

Mr Hope: We'll have to see, won't we?

Mr Wood: I haven't looked at your amendment yet, what you have under trust funds, but we can deal with that as we get there.

Mr Hope: The way we're moving, it'll be a while before we get to that section anyway.

Mr Conway: Thank you, Oliver Wendell Holmes.

Mr Wood: Section 28 deals with prices and fees. I've got no further debate on this.

Mr Brown: This is a critical issue to people in northern communities who are concerned with the forest, and I would repeat to the parliamentary assistant that his own estimates from his own ministry suggest a significant drop in silviculture activities in the forests of Ontario in 1994-95, the year we're in: We are down $11 million or $12 million from peak, and that's not adjusting for inflation at all. We're obviously getting much less done in the forests. This is a forest sustainability bill, and it seems to us that to take revenue away from the forest, which he apparently is trying to sustain, is the wrong approach. Therefore, I'm really confused about why the parliamentary assistant doesn't want to tell me why this is a bad idea.

We're talking about a transfer of funds, in your new scheme, of about $100 million, roughly speaking, from the pockets of northern Ontario people to the Treasurer of Ontario. All I'm trying to say is that we still need that money to do work in the forest and to promote our industry and do research.

Why aren't you willing to leave the people of northern Ontario and central Ontario, in those forest regions, with that money to use for very productive purposes, to create jobs?

Mr Wood: As I said before, I disagree with your motion and we will be voting against your motion as it reads.

The Acting Chair (Mr Gary Carr): Any further discussion?

Mr Brown: I think we need 20 minutes.

The Acting Chair: Okay, we're adjourned till 10 after 4.

The committee recessed from 1551 to 1612.

The Acting Chair: We're resuming with the vote on the Liberal motion, subsection 28(2). All in favour of the motion? All opposed? Defeated.

Now we'll be voting on section 28, as amended. All in favour?

Mr Brown: Can we record this?

The Acting Chair: Recorded vote.

Ayes

Ferguson, Hope, Jamison, Mammoliti, Wood.

The Acting Chair: All opposed?

Nays

Brown, Hodgson, Morin.

The Acting Chair: The section carries.

Mr Hodgson: I'd like to make a motion at this time to stand down all the clauses from where we are now up to section 66 and deal with section 66 in the remaining time. I'm asking for unanimous consent.

The Acting Chair: Do all agree?

Mr Hope: And that we revert back after that section to section 29?

The Acting Chair: Right. Okay, that's unanimous consent.

Section 66 is your amendment, Mr Hodgson.

Mr Hodgson: Yes. I move that subsection 66(1) of the bill be amended by adding the following:

"Manuals

"5. Scaling Audit Reference Manual."

I feel this is essential, that there be uniformity throughout the province on scaling. In the manuals that exist today, there are two small paragraphs to deal with this important issue. It's a fact that 92% of all the crown timber harvested in Ontario is scaled and weighed by the industry and $100 million is collected annually in the form of crown charges, and the only means of control and protection for the taxpayers and the industry is through a detailed audit program. There's been considerable work and effort expended over the past 15 years to develop such a program. It's been set out in the Scaling Audit Reference Manual and approved in policy, and it should be legislated.

I would hope that the government would agree to this amendment. It's in the ministry's own policy and it should be in legislation. It's fairly self-explanatory. I have a copy of the actual document, the Scaling Audit Reference Manual. Hopefully there wouldn't be any problem with incorporating this right into the legislation.

Mr Wood: We've had some discussion that we're not really in support of this particular amendment but we have other amendments that are going to address the concerns.

Mr Hodgson: If I could see that amendment, I might withdraw my motion.

Mr Wood: It's the government motion numbered 75-A in the upper right.

Mr Hodgson: But 75-A doesn't refer to incorporating the Scaling Audit Reference Manual. It says to insert "`and the conduct of scaling audits' after `in various circumstances' in the last line." I don't follow.

Mr Wood: I think the understanding is that we will incorporate what's in that particular manual you're referring to into the Scaling Manual.

Mr Hodgson: Will it mention specifically that there's a Scaling Audit Reference Manual? That's all I'm asking for.

Mr Wood: The intention of the amendment is that it will be drafted into one particular manual.

Mr Hodgson: It can be incorporated into your Scaling Manual if that's the intent of the government, but I'd like it referred to specifically as the Scaling Audit Reference Manual, those actual words, in the two paragraphs that deal with scaling in the act.

Mr Wood: I think what our intention is, and the discussions we've had to address the concern, is to give it the power of law and be able to put it into one manual. In the amendment, we're saying "and the conduct of scaling audits." It will be addressed all in one particular manual so we don't have two separate manuals.

Mr Hodgson: That's fine, as long as you mention and refer to this Scaling Audit Reference Manual. Fifteen years of work have been put into this by the ministry. It's recognized by the chartered accounting: "The standards imposed by this manual have been adopted for scaling audits, from generally accepted auditing standards as set out in the Canadian Institute of Chartered Accountants handbook, the standards for the professional practice of internal auditing as developed by the Institute of Internal Auditors, and as a strategy for scaling audit workshops."

I feel it's important that we reference this manual specifically, because there is some concern. I'm not an expert in this area, but there are various places in the act that refer to accounting. Accounting is only carried out in sampling procedures as part of an approved sampling plan; It's not part of scaling. I just want to be sure that we are consistent throughout the province and put this into the legislation, the exact words "Scaling Audit Reference Manual," that it's going to be the guide and the standard which is used across the province.

Mr Wood: The intention is that that will be incorporated into the manual dealing with scaling.

Mr Hodgson: So will the government motion be amended to specifically say the Scaling Audit Reference Manual at the end? You can amend that manual if you like, but I'd like it referred to. Is that the intention of the government?

Mr Wood: That wasn't the exact intention. The intention was to address your concern, that what is in there is going to be dealt with.

Mr Hodgson: What I'm getting at, if I can just be a little more clear, is that in subsection 42(3), there is a line in there that says scaling shall be carried out "in accordance with the Scaling Manual or, if directed by the minister, in such other manner...." This is the only way that the people of Ontario know that they're getting proper value for what's been taken off the crown land. You know you've taken a tree from this forest, it's gone to this processing facility, and you got paid this much money.

If we're not going to actually do the scaling, we should have a check in place that is consistent across the province that anybody can go by proven method and audit that trail and be assured that they're getting the proper money and that the proper things are taking place, so we wouldn't run into situations where the people of Ontario don't know what's going on in the forest.

Mr Wood: I don't know if I'm going to be able to answer to your satisfaction, but the intention is that the Scaling Manual is going to basically standardize this and will have the force of law to be applied out there in the field.

Mr Hodgson: I realize that, and if you can just make mention that in the Scaling Manual the guide is going to be the Scaling Audit Reference Manual, I'm satisfied with that.

Mr Wood: At this point in time, I don't know if we really want a reference to --

Mr Hodgson: Do you want to stand it down and go on to the next area?

The Acting Chair: We can come back to it eventually.

Mr Wood: Okay, we'll stand that one down and get back to it.

The Acting Chair: We will stand that one down.

The next one is a government motion to subsection 66(2).

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Mr Wood: I move that subsection 66(2) of the bill be amended by striking out "may" in the second line and substituting "shall."

The Acting Chair: Discussion? Seeing none, all in favour of the government motion to subsection 66(2)? Opposed? Carried.

The next one is, I believe, a Liberal motion, subsection 66(2).

Mr Brown: It's identical to the government amendment that we just passed.

The Acting Chair: Sorry; that's done. So we go to 66(2)(a), which is also a Liberal motion.

Mr Brown: I move that clause 66(2)(a) of the bill be amended by striking out "forest operations prescriptions" in the second and third lines.

The Acting Chair: Any discussion on that?

Mr Brown: There would be, except that we moved up about 40 sections and my sheets are a little out of order, Mr Chair. If you would hang on for one second, I can probably give you some reason for doing that.

Mr Wood: Maybe I could be helpful while Mr Brown is looking. We're looking at an amendment which would basically eliminate forest operations prescriptions from the Forest Management Planning Manual, resulting in the loss of opportunities for site-specific accountability. We don't want to lose this accountability and, as a result, we will be voting against the Liberal motion. We feel we need the prescriptions to be site-specific for accountability.

Mr Brown: I appreciate what the parliamentary assistant has just said, but the reason we are putting it forward is that we remain concerned that the prescription may not determine the future. In other words, a forester will, through the prescription, indicate what silviculture practices will be followed to restore the forest to a certain standard, and we are concerned that, having actually been on the ground, the prescription he has put forward will not be the prescription that will have the desired result, that the prescription found in the plan will not be the one that will actually do what we want to do.

I understand what the parliamentary assistant is saying, but I'm not certain that we're not getting process before result here. Maybe what we should be talking about is the result rather than the prescription. A forester needs the flexibility to change the approach once he's on the ground in a certain area on a certain day. What we should be more interested in than the prescription is what the plan calls for in terms of outcome. Instead of being so process-related, we should look at the result.

Mr Wood: All we really want to say is that before somebody goes in and takes everything out of there, he should be able to explain what was there in the first place.

Mr Brown: We of course agree with that, and we of course agree there should be a plan, but we're just concerned that the prescription might be carried out even if the patient dies, so to speak: the forest. What could be done and what was planned to be done are different things, and there should be an opportunity to make the changes so that the result is what happens rather than that we blindly follow some prescription that will not work.

Mr Wood: There is an earlier section that covers the flexibility you're concerned about.

Mr Brown: However, it is somewhat cumbersome.

The Acting Chair: Further discussion? Seeing none, we'll have a vote on the Liberal motion for clause 66(2)(a). All in favour? Opposed? It's defeated.

So we're on to the next government motion, clause 66(2)(b).

Mr Wood: I move that clause 66(2)(b) of the bill be amended by striking out "forest ecosystems" in the second line and substituting "crown forests."

This amendment is brought forward as a result of the hearings where we heard about the lack of commitment to contents in the manuals. One of the ways of dealing with it is dealing with it as "crown forests" instead of "forest ecosystems," and we feel this is going to address some of the concerns that were brought forward in the hearings.

Mr Brown: I'm just trying to determine how this is helpful. When you start talking about a crown forest, it indicates potentially a much larger area than a forest ecosystem. Are you not attempting, through this section, to deal with more specific sites than you might under a prescription for an entire crown forest?

Mr Wood: We're dealing with the Forest Management Planning Manual.

Mr Brown: But that applies to specific areas which are not necessarily in and of themselves a crown forest; it would be a specific ecosystem or numbers of ecosystems within that management unit or that FMA or whatever. The way it's written at the moment, it permits an understanding that the entire area of the management unit may not be the same. I'm just wondering why we're moving "crown forests."

Mr Wood: The feeling when drafting the amendment was that the wording would provide a firmer commitment to the content of the Forest Management Planning Manual. It's been kicked around out there by a number of people and we said, "Okay, we can go along with that," and we brought it forward.

Mr Brown: I'm actually not terribly concerned about the change in wording. I'm not too sure it makes a substantial amount of difference.

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The Acting Chair: Further discussion? Seeing none, we'll vote on the government motion, clause 66(2)(b). All in favour? Opposed? Carried.

Another government motion under clause 66(2)(b).

Mr Wood: I move that clause 66(2)(b) of the bill be amended by adding at the end "in accordance with section 1.1."

Interjection.

Clerk of the Committee (Mr Franco Carrozza): Section 1.1 is a new section that we put into the bill on the first day.

Mr Wood: We said we would deal with this in 66(2).

Clerk of the Committee: Chris, look at amendment number 2 in your book.

Mr Hodgson: I'm with you. So the discussion's on which amendment?

The Acting Chair: Clause 66(2)(b). It's 73.1 in the top right-hand corner.

Mr Hodgson: Got it. Fine.

The Acting Chair: Further discussion? All in favour? Opposed? Carried.

Another government motion.

Mr Wood: I move that the French version of clause 66(2)(b) of the bill be amended by striking out "notion de" in the first line.

The Acting Chair: Discussion, if any? All in favour? Opposed? Carried.

Now we jump to the motion numbered 76, which is the Liberal motion under subsection 66(2.1).

Mr Brown: We're not making those other ones?

Clerk of the Committee: Subsection 66(2.1) is a new subsection that you're adding to subsection 66(2). The amendment should be placed now because we just finished clause 66(2)(b).

The Acting Chair: Then we'll come back to 74.

Mr Brown: Is that a government motion?

Mr Wood: You withdraw yours and I'll make mine.

Mr Brown: Given the chances of passing this, I think we'll just withdraw it.

The Acting Chair: So the government can go ahead with motion 76-A.

Mr Wood: I move that section 66 of the bill be amended by adding the following subsection:

"(2.1) The Forest Management Planning Manual shall require that every forest management plan contain,

"(a) a description of the current structure, composition and condition of the crown forest;

"(b) management objectives relating to,

"(i) crown forest diversity objectives, including consideration for the conservation of natural landscape patterns, forest structure and composition, habitat for animal life and the abundance and distribution of forest ecosystems,

"(ii) social and economic objectives, including harvest levels and a recognition that healthy forest ecosystems are vital to the wellbeing of Ontario communities,

"(iii) objectives relating to the provision of forest cover for those values that are dependent on the crown forest,

"(iv) silvicultural objectives for the harvest, renewal and maintenance of the crown forest; and

"(c) a description of the future structure, composition and condition of the crown forest."

A lot of dialogue and discussion has gone on in the last couple of days in order to move this bill forward with the amendments, and I think all three caucuses have had some discussion on it.

Mr Brown: We are supportive of this amendment, particulary (c), I believe, which is important. This says, "a description of the future structure, composition and condition of the crown forest." In our view, a part of this bill that has been sadly lacking is any kind of objectives or measurable sustainability. I believe this is the first section where we actually talk about what we hope to achieve and that the management plan will have to address what we are hoping the forest to look like somewhere in the future.

We agree with this government amendment, as I think all members do. The difficulty, and I will just register it, is that this, in our view, remains in the wrong section. Statements like this should be in the purpose clause of the bill.

Mr Hodgson: As I think the parliamentary assistant said, my comments stand from the other morning when we dealt with section 1 of the bill. I'm supportive of the government's amendments. I think they take into account some of the debate we had at that time.

The Acting Chair: All in favour of the government motion? Opposed? Carried.

That will take us back to the government motion 74 under subsection 66(4).

Mr Wood: I move that subsection 66(4) of the bill be amended by striking out "may" in the second line and substituting "shall."

The Acting Chair: Discussion? Seeing none, all in favour of the government motion? Opposed? Carried.

That will take us to the next government motion.

Mr Wood: I move that clause 66(4)(c) of the bill be amended by striking out "persons engaged in forest operations" and substituting "persons specified in the manual who are engaged in forest operations."

Mr Brown: What does that mean? What is the improvement?

Mr Wood: To help you out, Mr Brown, what we're talking about here is that it's a way of being able to permit the certification of forestry workers as the need is identified. We needed some different wording to make sure that was clear. The amendment maintains the original intent. "Persons" by itself would have to be more defined. Now we can define them in the manual with this clarification.

Mr Brown: So really, it just allows you a little more latitude to use the manuals to describe those persons.

Mr Wood: Yes.

Mr Brown: Okay, I understand.

Mr Wood: We're ready to vote.

The Acting Chair: All in favour? Opposed? Carried.

This takes us to a government motion to amend 66(5).

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Mr Wood: I move that subsection 66(5) of the bill be amended by inserting "and the conduct of scaling audits" after "in various circumstances" in the last line.

A discussion has taken place over the last number of hours about putting proper language in here that's going to satisfy all three caucuses. A number of people outside of this room have been involved in drafting the wording and they say, "This is what we can live with." We agree. As a result, we've brought forth a motion that I think clarifies it and everybody understands it.

Mr Hodgson: In a perfect world, from our perspective we'd wish to see the word "must" instead of the word "may" at the start of subsection 66(5). There's some debate, but the side I've heard is that the word "counting" should be omitted; I understand there's quite a debate within the professionals who have to deal with this.

Also, after the "crown forests" insert the words "according to the Scaling Audit Reference Manual." Having said that, I'm assuming, and the parliamentary assistant can clarify, that the Scaling Audit Reference Manual will be incorporated in the scaling audits as required under this section and have the force of law. Therefore, it's an improvement and I'll be supporting this.

Mr Wood: This is the intention, yes.

Mr Brown: He also will be providing reports to the government, making I believe both the parliamentary assistant and the member from Victoria-Haliburton happy, as well as making a good improvement to the legislation.

Mr Wood: Thank you very much. I appreciate that.

The Acting Chair: Good. All in favour of the government motion? Opposed? Carried.

I believe we'll be then going to Mr Hodgson's motion which he --

Mr Hodgson: Yes, Mr Chair, I'll withdraw my motion.

The Acting Chair: Now we'll be voting on section 66, as amended. All in favour? Opposed? Carried.

Which takes us to section 67.

Mr Brown: Slow down. We're to revert back to section 29.

The Acting Chair: Sorry. That takes us back to --

Mr Brown: We've been so happy so far.

Mr Wood: Just rolling right along.

The Acting Chair: Section 29: I believe the first one is a PC motion, number 38 in your book.

Mr Hodgson: I move that section 29 of the bill be amended by adding the following subsection:

"Limitation

"(4) The annual area charge shall be restricted to the productive forest area available for harvest."

There was quite a discussion during our public hearings that it's unfair to ask a forest company to pay for the area charge when there's a large chunk of that area taken out of production. They pay for the area charge with their timber extraction, and if there are other values that need tree or forest cover they shouldn't have to pay the area charge on that area. I'm thinking specifically of setbacks or keep-it-wild zones or, in future hopefully, multiple-use purposes like hunting and recreational activities. If we're going to set those aside, it's unfair to ask the industry, of one use of the forest, to pay for the whole area charge. That's the intent behind my amendment.

Mr Wood: The intent of this section is that it provides for the area charges to be determined in the regulations, and the regulations currently limit the area to the productive forest area. It's preferable to allow the regulations to determine the appropriate area rather than having it in the legislation.

Mr Brown: We certainly are in favour of this amendment. Contrary to the parliamentary assistant's belief, it should be in the act, not in the regulations. As you know, regulations can be changed far easier than legislation, and I think it would be in the interests of Ontarians to have this described in the legislation so that if a future minister of the crown wishes to change the way this is done, he would at least have to come back to the people who have been elected in the province to have that determination made.

It is a problem we've heard a great deal about, where people believe they are being unfairly penalized by paying for areas of the forest that they have no opportunity to ever use. That is a concern we heard from Fort Frances through Kapuskasing and all points in between. Certainly, in some of the letters to my office and contacts we've had it's been a concern that people have had, and I don't really understand why there's a great deal of difficulty with this particular section being placed in the act. The parliamentary assistant says, "We're happy to do it in the regulations." I really don't understand what the problem is. If he has the courage of his convictions, he will be supporting this amendment.

Mr Wood: As I said, we don't feel the amendment is necessary. I'm aware of some of the misunderstanding that was out there, but we've tried our best to clarify any misunderstanding. We're determined that it should be in the regulations, and we're also talking about productive forest area.

Mr Brown: The issue is maybe a little broader than that. To be fair, we should understand that we heard a great deal during the three weeks of public hearings about the need for a defined land use: productive forest or industrial forest or commercial forest; we heard various terms for it. People holding licences are tremendously concerned that they will be involved in withdrawals, that they will pay for 75 years for the use of a specific area and that the very point when they are about to be able to productively use that part of the land will be the time it's withdrawn.

To some extent, that's the problem with area charges, that they encompass 100% of the forest -- with the exception of some land that has maybe been taken out, but generally speaking, the larger part of that -- when typically a forest operation occurs at best on 1% of that land mass during any particular year. So it's quite conceivable, when you're dealing with 100-year time frames, that you will never have the opportunity to use forest that may be withdrawn.

So we come to the issue of, "What is a productive forest?" and outlining it so that when we talk about the fees being paid, we're also talking about what exactly it is. Certainly, a member representing Cochrane North would understand that issue and the difficulty that people have with the fairness of paying for 100 years on something they eventually end up not being able to use in any productive fashion. Under this system, they will even be charged with the responsibility of managing that forest.

Mr Conway: Just as an example, in my area just last fall the minister, Mr Hampton, had engaged in a good discussion with a number of people in the community around withdrawal of lands, and a number of options were being considered. He did indicate, I thought quite properly, that he would in fact get back to -- in this case, it was to a committee of our county council because there was a concern that the withdrawal would have a real effect, as it did.

As I remember it, there were four or five options being considered. The minister said he appreciated the involvement, the consultation, that there would be a decision made on the basis of the options they had discussed but that there would be at least one last pass-over by the minister before a decision was made. Lo and behold, on Christmas Eve, I think at 2 o'clock in the afternoon, the minister opted for option 6, which was not on anybody's agenda, and announced it ex cathedra, as we say in my church. You can imagine what that did to local folks.

So these are real concerns. It may very well have been that the minister was animated by the highest order of public interest -- I can't imagine he had any other goal in mind -- but I repeat, the withdrawal that was contemplated was discussed and I think there were five options in an escalating order. At the end of the day, option 6 was chosen and announced unilaterally on Christmas Eve.

I just tell that little anecdote, because I know the parliamentary assistant would never do that. I don't know whether Santa Claus had just arrived late for the minister -- but anyway. I just tell that story to buttress the comments of my estimable friend from Algoma.

Mr Wood: I would only make another comment. With the last four or five words of that motion that you've brought forward, "restricted to productive forest area available for harvest," our concern is that there's confusion out there. We say "productive forest area"; you're saying "forest area available for harvest." This is the problem we have with the motion you've brought forward, and we're saying there is other wording that could be used in the regulations that will address that concern.

Mr Hodgson: The crown lands belong to all the people of Ontario. At some point, there's going to have to be a plan set in place on what uses are allowed if we're going to go down the road of multiple use that I think everyone in Ontario wants to go.

This is just a recognition of basic fairness, that if they're going to pay the cost of an area it be on the area they use. I don't see how that would contravene the intention. If the intention of the act is to put it in the regulations, why don't we enshrine it in the legislation itself and use it as a principle for all licence holders?

We're not talking about the Crown Timber Act here. We're talking about the ability to issue multiple licences on the same area of land, and I think a basic principle of that would be that you pay for what you use. If this is what the intention of the government in the multi-use strategy is, this just sets it out clearly and forces the ministry, some time between now and then, to set out that we're working towards multiple use with a specific plan on what we want to sustain and how we want to sustain it.

Having said that, I would suggest, Mr Chair, that we have a five-minute break so we can all read the legislation over and consider it in a little more detail before we're requested to even vote on it. I'm sure there can be compromises found between now and October 31, if there's unanimous consent.

The Acting Chair: Is there unanimous consent for a recess for five minutes?

Interjection: No.

Mr Hodgson: I can talk for another five minutes.

Mr Wood: Mr Chair, in the event that the five-minute recess might go beyond 5 o'clock, I would like to take this opportunity to thank all of our people who have been involved in the clause-by-clause and the public hearings: our political staff, the MNR staff, our people from Hansard, our translators -- everybody who has been involved in the four weeks we've been out there. I appreciated very much all the assistance we've had from everybody, and we'll be looking forward to getting back into clause-by-clause on this early in November.

The Acting Chair: Further discussion?

Mr Hodgson: I move adjournment.

The Acting Chair: All in favour of adjourning? Okay. We will adjourn until the call of the Chair.

The committee adjourned at 1655.