Legislative Assembly of Ontario

The House resumed at 8 o’clock, p.m.

DOMINION CARTAGE ACT

Hon. Mr. Winkler, on behalf of Mr. Turner, moves second reading of Bill Pr23, An Act respecting Dominion Cartage Ltd. and Downtown Storage Co. Ltd.

Mr. V. M. Singer (Downsview): Well that’s a good one! Where did they dream that one up? In the absence of the hon. member who moved it, could the House leader tell us what it’s all about?

Hon. E. A. Winkler (Chairman, Management Board of Cabinet): Nothing really much. There was some disability in regard to the cleaning up of the affairs of this particular company. The Clerk is now satisfied that the tax arrears which were outstanding have been paid, and it can now be passed.

Mr. Singer: Well now, I’m very fascinated by what the hon. minister says. Does he have any communication from those persons responsible for collecting those taxes?

Hon. Mr. Winkler: I did, or I wouldn’t be moving it. I’m satisfied.

Mr. Singer: Who was the person who transmitted the information to the minister? And on what date did he receive that information?

Hon. Mr. Winkler: This day, and it was transmitted to me by the Clerk of the House, who was satisfied with the returns that were made in regard to the bill that was before the committee.

Motion agreed to; second reading of the bill.

THIRD READING

The following bill was given third reading upon motion:

Bill Pr23, An Act respecting Dominion Cartage Ltd. and Downtown Storage Co. Ltd.

MINING TAX ACT

Hon. Mr. White, on behalf of Hon. Mr. McKeough, moves second reading of Bill 111, An Act to amend the Mining Tax Act, 1972.

Mr. R. F. Nixon (Leader of the Opposition): Mr. Speaker, it is nice to hear the former Treasurer’s (Mr. White) voice again; we haven’t heard him in action for some months. It’s interesting that the Treasurer (Mr. McKeough) has decided to ask his predecessor to pilot this legislation through the House. Of course, the former Treasurer was responsible for its interpretation many months ago, and it was referred to first in his budget in the spring of 1974.

The mining tax amendments have been commented on, of course, by the industry and others since that time, and I believe that the debate on this bill is a very important and significant one. I am wondering why the Treasurer has felt that his predecessor should carry the responsibility for this? It may be the present Treasurer feels the bill was rather unprofessionally drawn at the time, since the revenues, based upon this whole new approach to mining taxes, have been so far removed from the original predictions by the former Treasurer.

I don’t believe anybody here on any side is going to be carrying a brief for the mining companies, which have shown substantial profit increases over the last two years.

An hon. member: The Minister of Natural Resources (Mr. Bernier) will.

Mr. R. F. Nixon: But it seems strange they should be subjected to the rather strange and unusual pressures of a new tax Act, which seems to have been based on seat-of-the-pants predictions by those people in the mines branch of the Ministry of Natural Resources rather than with any kind of a hard-headed projection as to what the revenues might be, or certainly without any consultation.

Consultation with the mining industry is not necessary, but I believe that consultation with other taxing authorities is necessary. One of the important aspects of this legislation is the kind of pressure that is applied to the industry, when both the government of Canada and the government of this province decide here is a reservoir of revenue, relatively untapped, which can be used for purposes of general revenues which have not been, let’s say, foreseen in the past.

I have often heard the spokesmen for the NDP, when they are talking about certain programmes they want to bring forward, indicating that all of these can be carried out without any increase in tax revenues whatsoever, except those on the corporate profits of the mining industry. Inco is usually indicated as the chief one concerned. I feel this is a substantially misleading approach to the problems of corporation taxes. The phrase corporate bums is associated with the NDP, and certainly it hit a sensitive, respondent note in the community, which has often felt, particularly in the resource industry, that the corporate taxes and the rentals, as one might put them, for the utilization of public resources have not been adequate.

My own feeling is that the mining industry has largely been responsible for its own problems. In looking over the various briefs from the industry over a number of years, my own feeling -- and it may be prejudiced -- is that we would have some reason not to be entirely confident, not in their specific figures but in their attitude expressed toward the taxing powers of the province and the federal government. However I also feel, even recognizing the increase in profits that have been reported by the mining companies, that are well known in this province over the last two years, that it is unfair that the two jurisdictions, federal and provincial, have not had an opportunity, or not taken the opportunity, for the kind of consultation that would bring about a concerted approach toward the revenue-producing aspects of mine profits or the utilization of natural resources by the mining corporations.

Mr. W. Ferrier (Cochrane South): Where does that qualify?

Mr. R. F. Nixon: I am glad to hear the member for Cochrane South is participating, because I have a feeling the NDP is going to be very strongly opposed to this bill on the basis that it does not return enough revenue. I can remember that position being taken in the past when the member for Cochrane South actually spoke and voted against his colleagues because he, being a member from a community which depends upon mining resources for its livelihood, realizes that if we are not going to go toward public ownership, which we in this party reject, then the mining companies have got to have a level of profit which will permit them to expand their operations to keep on expanding their level of employment.

Mr. Ferrier: But not an inordinate level as this bill permits.

Mr. R. F. Nixon: You know very well, Mr. Speaker, being a close follower of the debates and the votes in this House, that the hon. member who is interjecting spoke and voted against his own party when we were concerned with special incentives for the Texasgulf corporation some years ago.

Mr. R. G. Eaton (Middlesex South): I bet he had some shares in it.

Mr. R. F. Nixon: I felt this was to his credit.

Mr. Singer: Some members didn’t know that. Didn’t they read about it?

Mr. R. F. Nixon: Not only did it indicate a certain independence of opinion, but I thought it indicated a certain sensitivity as to the views of the people in the north, particularly those who depend upon the mining industry for their employment.

People in Sudbury, and I remember the former member for Sudbury, Mr. Sopha, taking a strong stand in many of these matters, have another type of independence, based upon perhaps another view of the exigencies of the mining economy. But I will tell you, Mr. Speaker, that we in this party don’t believe any government, let alone an NDP government, should be running the mines of this province. I don’t think that is in the best interests of anyone. If we reject that as an alternative then we must in belief in the free enterprise system, have a tax base which is going to be seen by objective observers -- those without too many political axes to grind -- as a piece of legislation which is going to return to public revenue those shares of the profits of the mines which are deemed to be fair and equitable. This has got to be a subjective judgement.

Mr. J. E. Stokes (Thunder Bay): Oh, the member is talking out of both sides of his mouth.

Mr. R. F. Nixon: Yes, yes.

Mr. Stokes: What about Syncrude? What about Panarctic? What about the Canada Development Corp.? What about them?

Mr. Speaker: Order please. We’re debating second reading of Bill 111.

Mr. R. F. Nixon: I must say the member for Thunder Bay is consistent; that he’s a socialist and he believes the government ought to run the railroads, because he knows how well they run the railroads. They ought to be running the mines and they ought to be running all of these things, and he’s getting a little touchy --

Mr. Stokes: I didn’t say that.

Mr. R. F. Nixon: -- because he realizes that with only three members of the NDP here their position is a little weaker.

Mr. Stokes: The Leader of the Opposition said that. How many Liberals were here on Friday?

Mr. R. F. Nixon: It may well be, Mr. Speaker, that they’re hoping I will speak for quite a while until the hon. member for Riverdale (Mr. Renwick) --

Mr. Ferrier: We know how we are going to vote.

Mr. R. F. Nixon: -- gets back and tells them how they’re going to vote on this particular bill.

Mr. Singer: Aw come off it, come off it. There were more than there were NDP for two-thirds of the morning, and the member knows that.

Mr. Stokes: I don’t know that.

Mr. I. Deans (Wentworth): I don’t know that.

Mr. Singer: Well the member should, otherwise he can’t count.

Mr. Speaker: Order please. The hon. Leader of the Opposition has the floor.

Mr. Singer: I was here at 10 o’clock. There were nine of us here and there were five from the NDP.

Mr. Stokes: The hon. members are talking out of both sides of their mouths.

Mr. Singer: What is the member complaining about? Nine to five it was.

Mr. R. F. Nixon: To get back to the point, now that I’ve stimulated the hon. member for Thunder Bay to one of his better interjections.

Mr. Stokes: Stick to the facts.

Mr. Singer: Only when the members for High Park (Mr. Shulman) and Scarborough West (Mr. Lewis) aren’t here.

Mr. Stokes: Nothing but the facts.

Mr. R. F. Nixon: We are concerned at the lack of consultation between the two levels of government pertaining to the taxation of resource industries. I’ve read the arguments put forward by John Turner in defence of their stance with regard to the budgetary position which indicated that royalties, not taxes specifically but royalties, as a matter of importance, would be non-deductible from federal taxation. This does not apply to the mining taxes nearly so directly, since the federal government has withdrawn from approximately 25 per cent of their mining tax area in favour of the provinces. As I read this legislation and see the results of the taxation indicated by the Minister of Natural Resources, it appears we are more than filling that room vacated by the government of Canada.

I was interested to read a report of a speech made by the president of Noranda, Mr. Powis, who indicated that in this province their profits are now taxed at the rate of approximately 60 per cent. I don’t think that’s out-of-the-way. I would think that, as a shareholder in Noranda -- which I am not but I presume there might be a few within sound of my voice -- that I might object to --

Mr. Singer: Not in the NDP, surely.

Mr. R. F. Nixon: The member for High Park isn’t here. He probably has only one share so he can speak at their annual meeting.

Mr. Singer: The member for Cochrane South is grinning.

Mr. Stokes: He hasn’t said whether he’s a shareholder or not.

Mr. R. F. Nixon: He’s hardly ever here, is he?

Mr. Singer: No. The member for Cochrane South is a shareholder in Noranda.

Mr. R. F. Nixon: Mr. Speaker, I said before that the mining industry, years ago mind you, was its own worst enemy because it tended to mislead us in this Legislature -- and I believe mislead the community to some extent -- as to the problems it was facing and to some extent as to the financial impact of tax legislation.

I am hardly in an actuarial position to check the president of Noranda’s indications, but they were quite clear in a speech delivered to the Canadian Club or the Empire Club a few weeks ago, which was widely reported, that in this province their profits are taxed at the level of approximately 60 per cent. Anybody who is talking about a higher rate of taxation than that is talking about confiscation or public ownership. It seems to me that is a reasonable rate of taxation if we expect, as we do, that those mining corporations are going to direct a substantial share of their profits toward the expansion of the mining industry in the resource areas of this province. I believe that we depend upon them to support the exploration and the other work that would lead to the opening up of mines as the resources gradually work out.

I was interested also in reading his comments when he said that, in fact, these should not be classified as non-renewable resources because all of the minerals that are mined out of the ground are, in fact, still in utilization in the world today. They are not destroyed, but they are made usable by the operations of the mining companies.

Mr. F. Laughren (Nickel Belt): That’s stretching it.

Mr. R. F. Nixon: I don’t know whether it is stretching it or not, but I do agree with the gentleman who interjected, that once they are taken out of the ground their utilization as far as a source of corporate taxation is lost to us, so they may be non-renewable resources from a taxation point of view. The nickel and the copper and the gold and so on, however efficiently or inefficiently it is used, is still extant in the world, and in fact the amount is growing as it is removed from the earth, refined and made into usable products or set aside in vaults by those who want to treasure one particular metal or the other.

In returning to the views of the Minister of Finance for Canada, I feel the main pressure on federal policy has been brought by the oil-producing provinces. With their royalty policies it appeared more and more that if all of those payments were totally deductible from the federal taxation, the federal government would, of course, find the provinces that found themselves in the advantageous position of taxing oil resources would tax them at such a level that there would be no corporate profits left after the deduction for the federal government to tax at all.

I’m quite sure that if we had that sort of a policy here, rather than a direct mining corporation profit tax, it would be only good sense, if it were deductible federally, to tax them to the limit so that it would all be deducted federally and we would get the profits here. Anything less than that would mean we are not taking advantage of the situation for our own taxpayers and for our own revenue.

So I have a certain amount of sympathy with what the Minister of Finance has said and done. But I feel -- and I think this was indicated in the speech that I have already referred to twice -- that in order to stop the flow of federal revenue or the erosion of the federal tax base, it is the mining tax situation that’s been injured almost incidentally. I hope that it would be possible for the new Treasurer, if not the old -- and I’m sure that the former Treasurer had a good basis of discussion with his colleagues or with his opposite numbers in Ottawa -- to find a basis for sitting down and working out these problems so that both the province’s and the federal treasury would have an equitable share of these profits as they accrued to the mining corporation.

It’s strange that it’s just in the last two years that these great pools of profits, as they have grown unexpectedly, have been seen by both governments to be a tremendous source of perhaps unexpected revenue. I’m not sure that it wasn’t, in part, based on the attacks of David Lewis in the election campaign of 1972, but as well it was based on the fabulous windfall profits accruing to mining corporations as the prices of the products they had for sale skyrocketed in the world market. Even during the years when their prices seemed to be going up without limit, these people were sending out briefs to anyone who would read, taking full-page ads in the provincial dailies, drawing to our attention and the taxpayers’ attention, that the mining industry was very much a cyclical industry and that the values and the profits were very unpredictable.

Mr. Powis had some very harsh words indeed to direct to the former Treasurer, who is piloting this bill, the member for London South, indicating that he was ill-informed indeed. I think this has been borne out by any perusal of the price of metals on the world market today. While we hope the profit levels of the mining corporations will be such that they can maintain not only the present stance but an expanding programme in their industry, it is obvious that the prices, even compared with what they were when this budget was brought down and the taxes were first imposed, have dropped enormously, particularly in the case of copper. The gold mines are experiencing perhaps the greatest boom they’ve had since the palmy days when Harry Oakes and some of the others -- well-remembered names -- were taking the riches out of the earth and transporting them to Nassau and points out of this jurisdiction; something that was greatly to be regretted. I’m not prepared to criticize the government of the day for letting that happen, but this is another day and I hope that we can --

Mr. Laughren: Liberal government, is it?

Mr. R. F. Nixon: Oh, the member wants to make a speech on that, does he? Let’s tear the skin off Mitch Hepburn, he’s always a vulnerable target.

Mr. Stokes: That would be messy.

Mr. R. F. Nixon: That’s true.

Mr. Stokes: Old onion-skin.

Mr. R. F. Nixon: It was a bloody crime.

Hon. Mr. Bernier: That must be hard for the Leader of the Opposition to say.

Mr. R. F. Nixon: Not hard to say, no, no. As a student of history and this far removed I am prepared to say it.

An hon. member: I’m -- I’m -- I’m -- I’m for Nixon.

Mr. R. F. Nixon: But I do believe that there are about three things -- four, since I know the member for Thunder Bay is going to be interested to know how we are going to vote on this -- and I might as well end up by saying something about that.

Mr. Eaton: Have the Liberals decided yet?

Mr. R. F. Nixon: It’s essential that the provincial and federal jurisdictions work together better than they have. I don’t particularly want to get into the problem the former Treasurer had in dealing with the government of Canada. I always felt he couldn’t think of it as the government of Canada but only as “those Liberals in Ottawa.” Yet I feel his ability and his personality were deep and perhaps expansive enough even to overcome those rather sickly prejudices which he has shown in the past, and in fact deal with the government of Canada in a way which would be for the benefit of the province and not exclusively for the benefit of his own party.

The second point is that if we believe in the free enterprise system, obviously there has to be a level of taxation which is going to allow the mining industry to expand so that the job opportunities in the north are going to increase rather than decrease. I’m not at all sure -- as a matter of fact I am quite sure that it is not enough, simply to leave profits in the treasury of these corporations in the hope they are going to be spent for the purposes that I have described.

We know that Inco, for example, has used a good part of its profits to diversify out of the mining industry entirely and in another country. It used a huge chunk of its profits to buy a controlling interest in some battery company down in the United States, which is not going to be much good to us.

So the idea of strengthening the provisions of our laws and regulations and keeping the benefits from the profits of the metals extracted and refined in this jurisdiction -- let’s say in this country, which I think is the better view -- is certainly extremely important. It is not enough for us to say we are prepared to leave these profits under the companies’ control, with the expectation that they are going to expand their operations in a job-producing way.

It is necessary for the government to use its undoubted powers to see that those profits are used for that purpose, and I think that is quite within the realm of reasonable contemplation as far as policy is concerned.

I know we have had strong statements from the government over the years. I think Al Lawrence made the strongest ones, about regulations which would require the ores to be refined in Canada. We are prepared to applaud him for saying not just in Ontario but in Canada, but we were rather surprised to learn that he was giving licences for exportation of these ores which allowed more ores to be exported after he made his statement than before.

The problems that the mining industry has should not, I think, unduly preclude the co-operation between the Provinces of Ontario and Quebec. This means there has to be a meeting of minds between those people in authority in this province and also those in the Province of Quebec. We would hope the attitude of the government of Quebec would not be unnecessarily chauvinistic, if the word is appropriately used there. We are both provinces blessed with tremendous mining resources. It would be a shame if somehow a boundary were built along the borders between our two provinces, which boundary was unnecessarily going to restrict the activities of the companies.

Once again referring to Noranda, a good many of its products, and the products from the Timmins area, go across to Quebec. I think this is a great problem, as far as we are concerned, that we are losing the advantage of the jobs that could accrue to the people in this province. And I would think that the Minister of Natural Resources, who may in fact comment on this debate later, should give us some accounting of how he has dealt with the Province of Quebec, and certainly with the mining industry concerned -- Texasgulf and Noranda -- as to the problems associated with that boundary. And we must remember that it is not an international boundary but a provincial boundary.

Now, the revenue aspect is the other thing I wanted to talk about. It appears, from a rather vague answer from the Minister of Natural Resources this afternoon, that while it was predicted there would be revenues of $88 million from the imposition of this new tax, that he is expecting by the end of the fiscal year to receive $144 million -- and this is still a far cry from the predictions made by the Treasurer in his budget.

I remember that he got up a few weeks after the presentation of the budget and brought us the great news that revenues were going to far exceed his original predictions.

It seems to me that there must be somebody in the old Department of Mines -- I don’t know what we call it now; the mining branch or something -- who had perhaps not done enough calculating or enough consultation in predicting the revenues, even though the prices were going up very rapidly and there was every reason to predict a rapid expansion and then escalation of price.

I would say this: That a government with the resources in expertise that this government has, has been seen to be almost unimaginably inept in the imposition of the tax and its predictions as to its revenue.

I suppose a virtue can be made of the fact that we are now extracting revenue from mining corporation taxes amounting to $144 million, and I am sure there will be those who will speak after me who will say that it is still certainly insufficient; but on the basis of the view of the tax responsibilities vis-à-vis the mining corporations, we are prepared to support the government in at least the principle of dismissing the old tax procedure and putting in a graduated scale of the type that was announced by the Treasurer in his budget last spring.

We are prepared to be critical along the lines that I have brought forward, but essentially this tax base is directly associated with the level of profit.

There have been a number of loopholes left, which we would like to consider further. The fact that new mines as they come into production are to be considered separated from the parent corporation, is a tremendous advantage to the large corporations which already report very large profits indeed. If they had to pay taxes on the revenues from their new mining operations at the level associated with the overall corporate profits, of course it would mean that they would pay even more than the profits accruing from the new operations.

We are still concerned that perhaps this gives an undue advantage to some of the big corporations. We have a bit of a problem with this ourselves, I must admit, because we are committed to the free enterprise system. The last thing we want is for the government to be operating those mines.

Government policy must be directed toward keeping the mining corporation economically viable, by means of regulations, seeing that a large part of that viability, that is the profits, are turned into the further development, of Ontario first and secondly of Canada. This is not an easy job. It will require a much closer consultation on the part of the authorities in this province with their opposite numbers in the Province of Quebec; and much more important, the officials in the government of Canada.

Now I believe this is an important debate because there are those who are prepared to say that all our economic problems can be solved simply soaking the tax money out of the mining corporations. We do not believe this. We are not here to speak in their defence, because their profit levels are well known and have been put on the record of this Legislature frequently, most recently just this afternoon.

So it is with some reluctance, I must admit, that we are prepared to support the principle of the bill that is before us this evening.

Mr. Speaker: The member for Cochrane South.

Mr. Ferrier: Mr. Speaker, we didn’t expect much different from the Liberal Party.

Mr. R. F. Nixon: What is the member going to do for the miners in Timmins? That will be interesting.

Mr. Ferrier: If the Leader of the Opposition listens he will find out what I am going to do.

I am glad to see that it is the Minister without Portfolio (Mr. White) who is piloting this bill through the House. Unfortunately, the taxation of the mines should not be in the Ministry of Natural Resources. It should be in the Ministry of Revenue, because in my opinion there is a conflict of interest between the Ministry of Natural Resources and the taxation of the mining companies. There has always been too close a link between the mines branch of that ministry and the mining industry and I will just give you a little anecdote to point that out, Mr. Speaker.

This past fall I was visiting some of the local mines in my area with certain of the officials of the Ministry of Natural Resources and I got into a very heated discussion with one of the persons over the taxation of the mining industry. This particular person said: “You are taxing the mines far too heavily. You shouldn’t go ahead with this bill.” When I pointed out to him that it was only on profits that the taxation in this bill applies, he didn’t even accept that. It was interesting that standing there was the underground superintendent of the large mining company. “For God’s sake,” he said, “finish up your argument and let’s get down and view the mine,” because he had some other commitments later on in the day.

Interjection by an hon. member.

Mr. Ferrier: So we would have liked to see the government take the further step and put the taxation of mining under the Ministry of Revenue where all other taxation in this province belongs.

We are witnessing a federal-provincial confrontation over the resource tax field, as has been mentioned here by the Leader of the Opposition, and the federal Minister of Finance, John Turner, gave this as a principle of his budget: “It is essential that this sector bears a burden of tax profits that is reasonable, relative to the share borne by other sectors of the economy.”

Of course, that is recognition that the natural resources sector has borne a minimal tax burden for years. Eric Kierans remarked in his speech --

Mr. Stokes: That great Liberal.

Mr. Ferrier: -- and the remark is something revealing --

Mr. Singer: I hear the NDP is making him its new federal leader. Is that true?

Mr. Ferrier: -- although I am inclined to disagree to some extent with what he has said, if we use the Ontario experience as an example --

Mr. Singer: Who are they going to get?

Mr. Ferrier: Well, we won’t get the member for Downsview, that’s for sure.

Mr. Singer: No, I wouldn’t even offer.

Mr. J. R. Breithaupt (Kitchener): His is the only name I haven’t heard mentioned.

Mr. Ferrier: Kierans said: “If the resource sector has paid too little in taxes on the mining of natural wealth, this has principally been the result of federal policies and definitions of taxable income, not provincial legislation.”

Mr. Singer: Where is the member for Scarborough West tonight? He is not here tonight?

Mr. F. Young (Yorkview): The member should listen to what is going on here. There is wisdom being dispensed.

Mr. Speaker: Order please. The member for Cochrane South is making his remarks.

Mr. R. F. Nixon: The government of Manitoba didn’t accept Kierans’ recommendations when they were made to that government.

Mr. Ferrier: Well this speech wasn’t given to the government of Manitoba.

Mr. R. F. Nixon: They hired him.

Interjections by hon. members.

Mr. Ferrier: It seems to me, Mr. Speaker, that until now the provinces as well have been extremely generous to this particular industry. Nevertheless the federal government’s unilateral action to disallow provincial royalties and mining taxes goes right to the heart of the constitutional foundation of this country as laid out in the BNA Act.

Mr. R. F. Nixon: Is the member still quoting Kierans?

Mr. Ferrier: Sure, I am going to quote him again from the same speech --

Mr. Singer: Is the member going to vote for him for leader?

Mr. Ferrier: -- and he says that this action “indicates a new round of federal-provincial confrontations in which no government can sit passively on the sidelines while its provincial partners are picked off one by one. The debate will go to the core of the political structure of this country, that is, the measure of centralization that Canadians are prepared to accept.”

I must say that I personally deplore the federal government’s move into the provincial area of jurisdiction when they disallow the write-off of mining taxes. I agree there is much more revenue available from the natural resources sector than this bill before us will extract. But I believe the bulk of this revenue should come to the provinces, since our tax base is much more limited than is that of the federal government.

Hon. L. Bernier (Minister of Natural Resources): It may be higher than that of the federal government.

Mr. Ferrier: As to the non-deductibility of provincial royalties and mining taxes, I would like to quote from a statement by J. P. Coristine of the Iron Ore Co. of Canada, which he made at a panel on taxation of mining at the Canadian Tax Foundation.

“We find it highly objectionable in principle that the government proposes to include in taxpayers’ income amounts that he will never be entitled to receive. [He goes on to say] We would also like to raise the question which we cannot answer, as to whether the government is entitled to include in income something which does not, cannot and never will become the income of the taxpayer. [He sums up by saying] The strategy of using taxation to threaten vital industries in the natural resource sector, in order to achieve what a particular level of government believes to be an equitable share of resource taxes, is to be deplored.”

He’s quoting from the Canadian Bar Association’s presentation.

I feel that the federal government, in moving into this field as it has and pre-empting the provincial government’s right to taxation, is to be deplored. I am surprised that the Leader of the Opposition did not come out much more strongly on the province’s side.

The bill before us represents an increase from $88 million in mining taxes under the old scheme of taxation to $144 million. Not what one would call a dramatic increase or a reasonable increase. For this reason, we in this party will oppose the bill.

Mr. R. F. Nixon: Because it is a reasonable increase?

Hon. J. White (Minister without Portfolio): How high would the member like to see those taxes?

Mr. Ferrier: We’ll see.

Hon. Mr. White: The member personally?

Mr. Ferrier: Me personally? A good deal more than they are now because there are far too many write-offs and --

Hon. Mr. White: Spit it out.

Mr. Laughren: We’ll tell the minister. Wait for it. He’ll hear.

Hon. Mr. Bernier: The member is scared of Timmins. He won’t say.

Mr. Ferrier: However, this modest move by this government has triggered the usual hysterical denunciation and violent promises of capital lockouts that previous efforts to increase mining taxation have resulted in. We all got “Super Tax,” put out by the Ontario Mining Association, and many newspapers in this province carried the advertisements “Does anybody out there care?”

Mr. Laughren: I thought it was the John Birch Society that put that out

Mr. Ferrier: The poor, poor, hard-done-by mining industry. In “Super Tax” we read:

“Contrary to general public belief, the mining industry is not opposed to higher taxes or amended regulations, provided that they are reasonable and do not impair the industry in any of its essential functions. Modifications in tax rates, incentives and other regulations are desirable from time to time to meet changing conditions. But the mining industry, along with all other business sectors, must be permitted to earn reasonable returns under reasonable rules, which the industry can expect will not be changed at whim.”

Mr. Laughren: Sounds like Wallace.

Mr. Ferrier: I suggest, Mr. Speaker, that in the last couple of years in particular the profits of the mining companies have steadily risen to record levels in most of the companies’ histories -- profits that are higher than they’ve ever achieved before. Yet when they are asked to pay a modest increase in provincial taxes, they mount their usual scare campaign and threaten their usual blackmail.

Mr. Laughren: That’s right. That’s what they call it.

Mr. Ferrier: While the OMA and all the mining companies begin every article by saying that the industry does not oppose an increase in taxation, every statement that follows indicates how much they do oppose any increase. In an effort to try to meet a myriad of needs and programmes, costly as they are, and beset by inflation, I believe the people of this province have a right to demand a greater taxation return from the mining companies of this province.

Mr. R. F. Nixon: It is up about $100 million in one year.

Mr. Ferrier: In making this assertion, I am at the same time saying that a good close look needs to be taken at the taxation of the industry and corporate institutions that lie here in southern Ontario. The northern Ontario mining industry should pay more, and more of this money must go back into the north. A careful review is in order for the southern industries and financial institutions as well, to finance the government’s needs, without expecting us in the north to subsidize them.

As I understand this legislation before us, Mr. Speaker, the government’s intention was to double the yield from the mining tax and to secure a larger share of windfall gains. Going from $88 million to $144 million is certainly not doubling.

Mr. R. F. Nixon: Actually, it went from $45 million to $144 million in one year.

Mr. Ferrier: Not according to what the minister said this afternoon.

Mr. R. F. Nixon: The report for a year ago showed the revenue as $45 million.

Mr. Ferrier: This tax is a tax on bigness, as E. K. O’Brien of Inco complained in a paper to the Canadian Tax Foundation. He complained it represents an unveiled attempt to severely tax large profits without regard to investment required to produce those profits. The large windfall gains are there; the people have a right to a reasonable portion of them. As it is, these companies have such a pool of retained earnings from their retained income from mining that they have diversified into pulp and paper, forest products, battery companies, service companies and manufacturing, as they become even bigger and bigger multi-national conglomerates.

We kid ourselves if we think that the majority of the profits are returned to the shareholder. The truth of the matter is that he gets precious little of it. The system of taxation, Mr. Speaker, based on profit, has some merit in the mining industry. I agree that it is something of an incentive to mine the lower-grade ore, which otherwise might be left if a royalty system is used. This, of course, will extend the life of the mine and the community around about it. A graduated system does provide some assistance to smaller mines in that what profit they do accrue is taxed at a lower rate and the rate goes up only as the profit rises. The graduated tax, as embodied in the bill, is not an altogether bad principle, and the heavier taxes on the big mining companies are certainly to be desired.

The truth of the matter is that the mining industry is almost exclusively made up of giant mining corporations. The small mining companies are becoming a thing of the past and this is not desirable. The reason why this bill does not do what it is purported to do is that the base on which the tax is levied is still inadequate and too many exemptions and concessions are still granted. R. D. Brown, a senior tax partner with Price Waterhouse and Co., wrote an article entitled “The fight over resource profit.” It was, I think, in the 1974 July-August edition of the Canadian Tax Journal. He wrote this paragraph:

“Because of the deduction of the processing allowance in determining mining profits subject to provincial mining taxes, and because of arbitrary disallowances and other differences in the calculation of income from mining tax for income tax purposes, it has always been difficult to express provincial mining taxes as the equivalent of effective corporate income tax rates. Up until the past year the maximum rate of provincial mining tax in the more important mineral-producing provinces -- Ontario, Quebec, Manitoba and British Columbia -- was 15 per cent, but in many cases the effective rate of such taxes, after processing allowances and after allowing for their deductibility for income tax purposes, was very substantially less.”

The tax base on which the mining tax is levied is greatly reduced from the actual profit the mining of the ores actually produces.

Before this bill becomes law, mining profits were taxed at 15 per cent but the deductions of the following expenditures were allowed: exploration and development expenditures in Ontario; depreciation on mining and processing assets on a straight-line basis at a rate of at least five per cent but not more than 15 per cent of the original cost of the assets; processing allowances -- which, according to E. K. O’Brien of Inco, are the most generous in Canada and which we propose to make much more generous -- are permitted as an annual deduction in determining taxable mining income.

Based on original asset cost, eight per cent is permitted in respect of concentrating assets, 16 per cent cumulative in respect of smelting and concentrating assets, and 20 per cent cumulative in respect of refined smelting and concentrating assets.

The change in this bill, as introduced by the minister when he was the Treasurer of the province, was to introduce the graduated tax -- as noted in section 2 of the bill -- and some other things: Depreciation allowance of up to 30 per cent for new plants, equipment, machinery and buildings, exploration and development expenditures incurred in Ontario after April 9, 1974, and prior to the commencement of production will now be permitted as a deduction in computing profits.

In the words of the minister who is piloting this bill before this House, in the new system we retain several existing measures that have, in the past, stimulated exploration, new investment and domestic mineral processing. These measures include the automatic depletion allowance, the full deduction of exploration and development expenses and the generous fast write-off provisions of the Corporations Tax Act and the Mining Tax Act.

When the minister introduced this bill into the House on June 20, 1974, he made some more concessions and modifications. First, new mine income was to be disaggregated for the purpose of calculating mining tax, and depreciation allowance for new mining assets increased from 15 per cent to 30 per cent on a straight-line basis and applied to new assets after April 9. Processing allowances were improved in respect of refining assets as they’re operated in northern Ontario, and a further processing provision was added to existing ones in order to encourage, in the minister’s words, “manufacturing in northern Ontario.”

The processing allowance applies to assets when acquired prior to April 9. No processing allowance could be taken until the asset was used.

In the bill, as I have stated, when the minister introduced it on June 20, 1974, the provision was made for the disaggregation of new mines for the purpose of calculating the mining tax. He described it in a speech to the Canadian Club in New York as follows:

“New mines will be taxed individually, not collectively, to allow each mine to work its way up the graduated tax structure. This measure will not only encourage new investment but will also provide equal tax treatment to the new mines of all companies, large and small.”

But disaggregation, if applied to separate and distinct ore bodies, may have some merits. In the Timmins area, Pamour Mines has adopted the practice of developing several small gold ore bodies, obviously and geographically distinct from the ore body at the original Pamour mine and miles away from it. There’s the New Joburke and the Golden Arrow -- and the ore is trucked from these mines to the Pamour mills for processing. Perhaps if disaggregation is limited to this kind of operation, as I say, it may have some merit.

But Dr. Charles Fogarty, president of Texasgulf, in an interview with financial analysts in Toronto, is reported to have said that disaggregation will allow Texasgulf to sink a new shaft a little distance from the present shaft so that it can go deeper underground in the same ore body at the same mine site to develop workings at this lower level.

If disaggregation permits this to take place so that the ore from this new level of workings of the same ore body is taxed at the graduated rate with the exemption for the first $100,000 profit and up to the graduated scale until you get $40 million, and it’s reached at the 40 per cent level, then I am opposed to the principle of disaggregation.

I would ask the minister in his response, Mr. Speaker, to deal specifically with this question as it relates to the situation I have outlined at Texasgulf. Does disaggregation mean that you can do this with the same ore body, as was suggested by Dr. Fogarty?

As I understand it, in regard to the processing allowance, this was heretofore not in the legislation, but it grew into the manual of the mines assessor. There was no set down legislation or provision in the regulations; but it is just a practice that has grown up. Is the minister going to regularize this in his bill? The processing allowance in this bill is enriched in three significant ways, according to the aforementioned speech of the Minister without Portfolio when he was the Treasurer. It was given before the Canadian Club in New York, and I’ll just read part of what he had to say there. He said: “First, there will be a sharp increase in the allowance rate for ore refined in northern Ontario. Secondly, a new incentive category will be established for companies that carry processing in northern Ontario beyond the prime metal stage. Thirdly, companies will be allowed to apply the allowance as capital works are constructed, rather than when they are completed and put into production.”

He went on to say: “I have mentioned that some of our measures are of particular benefit to the small companies, but one should not infer from these remarks that large companies will find their incentives reduced. This is not so. To determine what impact our new measures might have on large, integrated mining companies, we analysed one large company situation and found the processing allowance alone will reduce its tax this year by more than 15 percentage points, bringing its rate down to about 20 per cent.” So, the government is eroding the tax base and it is admitting it in a very significant way, and in a growing way. And then the minister went on to say that the big companies are going to go ahead with the expansions they have announced, or they intend to accelerate their expansions.

Let me say, Mr. Speaker, that until this bill is passed the new expansions of Texasgulf in the Timmins area will not be formally announced. The expansion at this mine will be a copper smelter and refinery, plus a fertilizer plant and a possible lead refinery. If all these plans go forward, as I am sure they will, Texasgulf plans to spend about $500 million on plant construction in the next few years.

At this point Texasgulf is playing a very skilful waiting game in anticipation of as many tax concessions as is possible from this government. It did it when the negotiations to construct a zinc refinery were going on. At that time both provincial and federal governments were very generous. In fact, through DREE, the federal government granted it over $8 million, and the province made major concessions as well.

An interesting sidelight on this was the concession to the company made, supposedly by Allan Lawrence when he was Minister of Mines, as to the write-off of the rental on the railway spur. But that was not honoured by the ONTC since apparently Allan Lawrence made the concession without formalizing it in contract form. So poor Texasgulf lost out on that one.

Mr. S. Lewis (Scarborough West): The only useful thing Allan Lawrence did while he was Minister of Mines was to foul it up.

Mr. R. F. Nixon: Where is he now?

Mr. Ferrier: As long as governments at the federal and provincial level intend to carry out resource development by means of large general tax concessions, and subsidize the large mining companies, I do not blame Texasgulf for trying to exact as much as it can get.

Mr. Lewis: It’s called capitalism.

Mr. Ferrier: But is this the right principle to follow in terms of development? Do we have to make these kinds of concessions? Consider this recent release on Texasgulf’s 1974 sales and earnings, from New York, Jan. 28, 1975. Mr. Speaker, it reads:

“Texasgulf Inc. announced today record sales and earnings for the year 1974 exceeding the previous record set in 1973.

“Net income for the fourth quarter of 1974 amounted to $42,218,000, or $1.39 per share, compared to $26,676,000, or 88 cents per share, in the fourth quarter of 1973, an increase of 58 per cent.

“Sales in the fourth quarter of 1974 amounted to $156,152,000, compared to $111,236,000 in the fourth quarter a year ago, an increase of 40 per cent.

“Net income for the year 1974 amounted to $147,442,000, or $4.84 per share, compared to $73,922,000, or $2.43 per share, for the year 1973, an increase of 99 per cent.

“Sales in the year 1974 totalled $568,526,000, compared to $363,776,000 in 1973, an increase of 56 per cent.

“The company’s chemicals and metals divisions were the principal contributors to the higher 1974 sales and earnings, with chemicals showing the greatest percentage increase. The oil and gas division made smaller gains.”

Mr. Speaker, does the multi-national resource company with net income of $147,442,000 for 1974, with a significant portion of this from the metals division -- that is, the Timmins operation -- need all the extra concessions that the minister proposes in this bill and is anxious to hand out to it?

Mr. Laughren: Not bloody likely.

Mr. Ferrier: I seriously question the minister’s exceeding generosity in that programme. I feel that that expansion will go ahead anyway, since the ore body is so rich and such a large profit is to be made over the years that it can more than finance the major expansion that is proposed.

As a side comment, Mr. Speaker, the longer they delay in going ahead with this construction project, the more it’s going to cost them. Inflation is unchecked and it’s going up, construction costs are going up as high as anything else, so they are being rather self-defeating if they delay.

The ore at that mine is an extremely rich ore. It’s varied and it’s complex. It contains zinc --

Hon. Mr. Bernier: I hope the member sends this speech back to Timmins.

Mr. Ferrier: The minister will send it back, I know that; I don’t care. I’m making it here in public, hoping that as many people as possible will read it, because I think it does justice to the whole situation and stands up for the good of the people of this province.

Mr. Young: If the government extends it to the company, it should extend it to the people.

Mr. Ferrier: That ore contains zinc, copper, lead, silver, tin and small amounts of gold, so that its worth is very great. As well, the extent of the ore body is still not defined.

Hon. Mr. White: I have been in Timmins a dozen times. They don’t even know who the member is.

Mr. Laughren: They certainly know who the minister of mines is and what he has done to them. That they know.

Mr. Ferrier: The people of Timmins have no trouble knowing who their member is. He looks after them.

Hon. Mr. White: I didn’t know who their member was.

Mr. Ferrier: The minister doesn’t know a lot of things. He doesn’t know a lot of people.

An hon. member: It’s a good thing he is getting out of politics.

Mr. Young: He ought to make a trip to the north sometime.

Mr. Ferrier: This bill enhances the processing allowance by making it applicable as soon as the capital project undergoes construction rather than waiting for its completion, as is now the case. This is a major concession that this bill incorporates. Furthermore, the processing allowance is increased so that smelting facilities in either northern Ontario or the rest of Canada can be deducted from mining income at the rate of 16 per cent instead of eight per cent.

Refining facilities are raised in northern Ontario to 30 per cent while they remain the same in the rest of Canada at 20 per cent. Further, processing facilities in northern Ontario will qualify for 35 per cent write-off against mining income. This is new. However, the processing allowance, as I understand it, which is now eight per cent for ores processed outside of Canada, is abolished.

This kind of incentive to the private mining industry which is really the giant mining firms of Inco, Falconbridge, Noranda, Texasgulf, Rio Algom and Denison, is far too rich and unnecessary. It gives away too much of the public’s money in the name of development. It is socialism for the rich while we preserve free enterprise for the poor. I do not happen to think we need to make all these kinds of generous concessions to the rich.

We react too readily to their hysterical denunciations and high-pressure threats. We do not negotiate for the people of the province, of whose resources we are the trustees, with sufficient resolve and determination. We are like Esau in that we are prepared to sell our birthright for a mess of potage. We must be prepared to face up to the public involvement in our resource development in the mineral field. We can find $100 million to invest in Syncrude in Alberta to bail out the multi-national oil companies. Why cannot we find this kind of money to develop our mineral resources for our own good rather than engage in further tax write-offs and concessions to the industry?

As Eric Kierans has written:

“It is the value of the ore or the crude oil and gas that is of paramount importance to the provinces. The refining and conversion process built upon them can and should be left in the private sector, assuming the conditions of supply and competition obtain. Therefore the task facing provincial taxation authorities is to disentangle from the varied complex and diversified activities of the large resource corporations the direct and simple costs of the actual mining. This is where the real profits are to be found, hidden though they may be by depletion and exploration costs and averaged into the overall group returns of the diversified, modern conglomerate. That these profits are large can be judged by the huge holding-company structures built upon the flow of funds from the original resource concessions.”

We should, therefore, hasten the move to set up a provincial Crown corporation to do exploration and development in the mineral domain, such as is being done in Quebec, Manitoba and Saskatchewan. We should not be dragging our heels, as the present Minister of Natural Resources is doing, even though he had stated about a year ago that he will move in this direction.

I think that in the next five or 10 years, as Kierans has said, all further exploration and development will be carried on by the provinces themselves. He said:

“Efforts by the federal government to enhance its share of revenues after 100 years of neglect can only hasten a trend which is already developing. It is apparent to the public that turning over their natural resources to large corporations in exchange for the employment created to extract that wealth is not a sufficient return for their real value. They are also aware that any efforts to procure a larger share of the rent that should accrue to them by right of ownership are likely to be prolonged, frustrating and futile in the end. Negotiating with an industry that threatens at every change in legislation to pick up its marbles and go elsewhere is hardly a profitable and certainly not a satisfactory exercise.”

So says Kierans. He also goes on to say that even the companies themselves are recognizing that the government is going to move in and develop these resources, because they are using their cash flows and their extra money to diversify into other industries such as pulp and paper and lumber and manufacturing and the service sectors. He says: “How else does one explain the current wave of takeovers with funds that should more properly have gone to shareholders?”

We heard the Leader of the Opposition, Mr. Speaker, and the industry itself has certainly been saying that even this tax rate that we are imposing in this bill sets up a 7 per cent tax rate. I wish to make a reply to that charge. In the first place, it is a marginal tax rate, not an average tax rate. Secondly, it is a maximum.

It is made up of the following, and I am giving you a summary that I have taken from Stat. Can, 61208 for 1970. It gives a general indication of the importance of some deductible items for metal mining companies in Canada. The figures that I use are for 1970:

The profits on the books of the companies before taxes in 1970 were $883 million. From that we deduct exempt mine income of $179.6 million and other exempt income, primarily Canadian dividends, of $134.9 million, to get the total non-exempt income of $518.5 million. The industry was then permitted to deduct $106.1 million more in depreciation allowances than the actual depreciation as carried on the books of the company.

In addition, exploration, development and depletion were deducted to the extent of $175.3 million -- more than actual costs in these areas as carried on the company’s books. A further deduction of charitable expenses, $.3 million, was allowed; as well as mining taxes, the ones that are now disallowed by the federal government and the source of the current row, the $46.4 million, there were other deductions of $7.5 million, bringing the total to $54.2 million.

This left a taxable profit, after adjusting for prior losses, of $217.9 million on which federal and provincial income taxes of $114.5 million were paid. These taxes represent 52.6 per cent of taxable profit, but only 13 per cent of book profit.

The point comes home even stronger when it is recognized that we would object to book profit as being too low a measure, as well because one deduction in calculating book profit which one wonders whether we should consider is depletion. The resource belongs to the public, why should we compensate the mining companies for its depletion? In 1970, that item in these companies’ books amounted to approximately $69 million. This raises our notion of profit to $952 million and drops the percentage paid in taxes to 12 per cent.

Mr. Speaker, we in the NDP caucus are not fooled by the smoke screen of the very powerful lobby and public relations job that has been done by the mining companies as they try to deceive the public into thinking this bill overtaxes them. We continue to believe that the concessions and privileges, even with the federal disallowance of provincial mining taxes, are too great and not necessary. Not only must the public have a greater return from our resources, but the public sector must move to real involvement in the exploration and development aspects of this industry. Therefore, Mr. Speaker, we oppose the principle of this bill and will vote against it on second reading.

Mr. Speaker: The member for Nipissing.

Mr. R. S. Smith (Nipissing): Mr. Speaker, I have a few comments I’d like to make in regard to this bill; some of which may agree with the remarks of the previous speaker and some of which may not. There are two things -- pardon?

Hon. Mr. Bernier: Does the member agree with his leader, the previous speaker?

Mr. R. S. Smith: Oh, I agree with my leader, yes.

Hon. Mr. White: That’s a nice change.

Mr. E. J. Bounsall (Windsor West): As far as he went.

Mr. Singer: Well, when we get White not agreeing with White, as the members will see very shortly, that’s an interesting change, too.

Hon. Mr. White: Well, any time two Liberals agree it is a minor miracle.

Mr. R. S. Smith: How many fingers has the Minister without Portfolio?

Mr. Singer: Which speech does he agree with? The question is, do they have a leader left over there?

Mr. Lewis: Tell me which two Liberals agree! Name two. I challenge the member to name two.

Hon. Mr. White: This gentleman says he agrees with his leader.

Mr. Lewis: Nonsense, a momentary aberration!

Hon. Mr. Bernier: I want to hear it.

Mr. R. S. Smith: Last week we had a couple of bills here and we had the NDP sitting here arguing among themselves, and all we could hear over here was one guy saying: “Why don’t we have a half an hour to have a caucus so we can decide how to get together on something?”

Mr. Young: It was a Liberal who said that.

Mr. Singer: The member for Riverdale stood alone the other night on section 5, yes.

Mr. R. S. Smith: No, no; the liberal who sits to the left of the NDP leader?

Mr. Singer: Yes, and all his colleagues sat and glared at him.

Mr. R. S. Smith: And that’s exactly what he said.

Anyway, Mr. Speaker --

Mr. Singer: Would the leader of the NDP tell us about that?

Mr. Lewis: With us it’s flexibility, Mr. Speaker; there it is called anarchy.

Mr. Speaker: Will the hon. member for Nipissing continue?

Mr. R. S. Smith: Thank you very much Mr. Speaker. I am glad to see the flexibility of those people to my left.

There are two things that have happened in the past week-and-a-half or so which I think are significant in light of this piece of legislation. The first was the fact that the government, for the first time, took an equity position on natural resource exploration, but it took place outside of the Province of Ontario; that was the $100 million they put into the Syncrude deal. The second was their decision to change what has always been government policy, so that funds that came into the coffers of the province would be earmarked for specific types of programmes. This was done by the setting up of the lotteries bill; and the Minister of Culture and Recreation (Mr. Welch) has assured us that those funds are earmarked for certain things in culture and recreation.

But then we come to this bill, which in effect increases the amounts of moneys that are going to be collected from the mining corporations during this 12-month period from the $45 million that was collected last year to the $144 million the Minister of Natural Resources says are going to be collected this year. So in effect the increase is $100 million. It’s very close to the amount they’ve already committed to Syncrude.

I for one take a little different tack than some people in the Legislature would, in that I believe that perhaps we should have some earmarked funds. The earmarked funds, the $100 million increase that is being taken out of natural resources in northern Ontario through this bill, should be earmarked to be placed in an equity position in those public companies that are extracting our natural resources in northern Ontario.

If these tax funds were placed back into northern Ontario in part ownership of the natural resource in conjunction with the private sector, we would know what the profits are because we would be the benefactors of those profits through the acquisition of our equity position.

I realize this is not good Conservative government policy. So far as I know, the only time they’ve taken an equity position has been in a company that’s outside of the province, the Syncrude deal. But they have done that, and I think in doing that they set a precedent that can be easily followed, in that perhaps we should set as a goal a 30 per cent to 40 per cent equity ownership position of the natural resources in the mining industry in this province to be held by the Province of Ontario.

Mr. Laughren: It is different from his leader.

Mr. R. S. Smith: No, it isn’t different.

Mr. Laughren: He says it is. He says he is all for the private sector, the free enterprise sector.

Mr. R. S. Smith: I am saying it is in conjunction with the private sector. We are not scared to be in partnership with the private sector.

Mr. Young: Isn’t the member afraid he is heading into socialism that way?

Mr. R. S. Smith: Does the member mean like 100 per cent? I don’t say that we have to have that.

Hon. Mr. White: He is right, they don’t agree.

Mr. R. S. Smith: The NDP leader said at the time of the budget introduction that this is doing nothing but calling for the total takeover of the natural resource industry in northern Ontario. That’s what he said, and that’s the member’s leader. Does the member disagree with him? He said 100 per cent, and that is where those people all stand. Either that or they are divided. They should make up their minds what they want to do.

Mr. Speaker: Would the member for Nipissing get back to the principle of the bill?

Mr. R. S. Smith: That is the principle of the bill.

Mr. Lewis: Somehow you don’t look respectful about it, Mr. Speaker. You don’t look awesome enough. Can you take your foot off that stool and sit up, Mr. Speaker? You look too comfortable.

Mr. Speaker: Back to the principle of the bill.

Mr. R. S. Smith: You are not supposed to be that comfortable. I am on the principle of the bill, but I will continue anyway.

The fact of the matter is that through this bill the government of Ontario is enriching its coffers by $100 million this year over last year through the mining tax, and for the Minister of Natural Resources to sit there and see this $100 million extracted from basically northern Ontario, and with no earmarking of this money to go back into northern Ontario to assist in the rebuilding of many parts of the province there that have gone down the drain because of the continual extraction, I think is terrible.

I think we should be putting this money back into equity ownership in northern Ontario. We should be putting it back into exploration and into the development of new industries, whether they be in the primary extractive area or in the secondary industry level. I believe that since these moneys are going to be made available, if we can earmark money for culture, if we can earmark money for recreation, certainly we can earmark money for equity positions in the natural resource field and for further assistance to the areas from which these moneys are coming.

There is no question that when we move up to a maximum 40 per cent tax on profits we are moving into a large share of the extractive profits from the natural resources in that area of the province, and therefore we as a government have just as big a responsibility as those in the private sector to put something back into the parts of the province from which they are taken.

That has been the problem. That’s the problem in Sudbury; it is the problem in Timmins; it is the problem right across northern Ontario -- it is the problem in the minister’s own riding -- that those privately-owned companies have not put back into that area, and not put back into my area, anything as compared to the amounts they have taken out. When the government sets its share of that profit through taxation at 40 per cent, then that same government, this government, has the same responsibilities we feel those in the private sector have, and that’s to put the money back from where they are getting it.

But this is not the case, and it obviously is not going to be the case. These extra hundred million dollars in tax funds are being used for the good of the whole province, and certainly I can’t, as a provincial member, say that it is money being wasted or that it is money being badly spent. There is no question that all the programmes need funding, but on the other hand, if we can find fault with the private companies for not putting the moneys in the form of profits back into that area of the province then at a 40 per cent rate, I certainly find fault with a government which has no other programme which is going to use this extra $100 million to foster any type of development in northeastern or northwestern Ontario.

I would just like to close by making the point that I agree with the fact that we need to take more money from these corporations. But I do believe that it’s time that we as a government looked at taking that money and reinvesting it in those corporations, so that we will become equity shareholders and become direct benefactors from the large profits that are coming out of that industry.

Mr. Speaker: The member for Nickel Belt.

Mr. Laughren: I rise in opposition to this bill. I’m surprised that the last speaker adopted the very beginning part of the New Democratic programme on resources which we adopted at our convention in Sudbury in September. It’s a very appropriate place to adopt a resolution on resource ownership --

Mr. R. S. Smith: It’s different, though. It’s using a variety of co-ownership.

Mr. Laughren: -- in which we stated that we would move towards the public ownership of resources using a variety of means in the short term. Of course, that’s our policy and we’re very proud of it.

We are opposed to this bill, primarily I suppose because we’d be opposed to any bill that returned more from our resources to the multi-national corporations that exploit them than to the people of Ontario who own them. That’s really the crunch where it comes down.

It really wouldn’t matter what kind of bill on the taxation of resources that the government introduced; if it involved the taxation of resources, we would be opposed to it because of that very fact. I don’t think I can be any more specific than that. As long as the government is talking about the taxation of resources in such a way that more of the revenue from those resources goes to the multi-national corporations than goes to the people of Ontario, we will stand opposed to that kind of legislation.

Mr. Lewis: That’s a good rule of thumb.

Mr. Laughren: There’s no other way to put it.

I don’t know what further examples the government needs in terms of non-renewable resources. It has seen the example of oil and what we could be doing now with our oil if, many years ago, we had moved to control and own our own resources in petroleum. We know as well -- we’ve had all the warnings from the mining industry -- that the higher you set a tax rate on resources, the more you force the mining industry to highgrade that resource. You push them into the corner, Mr. Speaker, and that’s really all that’s left for them. You force them to explore and develop their ores elsewhere.

It’s in all the publications that if you continue to increase taxes on resources they will have to explore and develop ores elsewhere in the world. They make no secret of that, Mr. Speaker. The whole question of the federal-provincial dispute on the taxation of resources is because the provinces left the tax room there.

The provinces stand condemned -- and Ontario is certainly no exception. Ontario left the tax room there and the federal government could see that we were not obtaining what we should from our natural resources, so naturally they moved in to impose the tax. Had the provincial government been obtaining from those resources what the people of this province should have been obtaining for many years, the federal government would not have had the tax room to move in there.

We know that a Conservative government, or for that matter a Liberal government, will never move toward changing the status quo in terms of the resource industry; not because it doesn’t make good sense but because that’s too blatantly socialist and, of course, would alienate their friends. We understand that and it doesn’t change our opposition to the legislation the government brings in.

I should remind the minister that an increasing number of Canadians -- people in Ontario are no different -- are feeling the way we do about non-renewable resources. And, despite what the leader of the Liberal Party says -- he was quoting, not saying it himself -- our non-renewable resources are just that. They are non-renewable; the minister understands that. It’s not good enough to say that the products they make are in circulation out there. Those products depreciate and over a period of time they are no longer there either, just as the resource itself is no longer there.

I could quote briefly from a nonetheless reputable journal, the Canadian Tax Journal. In the July-August, 1974, edition it says:

“The view is increasingly held that the depletable natural resources must be husbanded and developed only where positive benefits to Canada would result, and not squandered by being exported in an unprocessed state or without major contributions to domestic employment and industrial development.”

I want to come back to those two points in a minute -- domestic employment and industrial development -- because I think therein lies the real significance of our natural resources.

I know that the minister might say that this kind of taxation will achieve that, but that’s utter nonsense -- it does not. I would like to quote some of the Minister of Natural Resource’s own statistics in terms of employment, and relating employment to the actual output of the mining industry. The last figures available on employment were from 1972; so that’s why I’m using that figure, for no other reason.

Between 1962 and 1972, our mineral output -- I’m talking about minerals, not quarries and so forth -- was up 68 per cent, while during the same 10-year period employment dropped in absolute terms. So we have a situation where output is increasing dramatically and employment is dropping. Now, how is that increasing the development of the province? How is it making a major contribution to domestic employment? I don’t know what is being accomplished by the increased output if we are not increasing either the development of the province or domestic employment -- and neither is happening.

Mr. Speaker, when I witness things like the development of southern Ontario in the form of the Nanticoke development, for example, I think of a steel company coming to the government and saying, “We wish to develop a major complex there.” And the government acquiesces. It does this rather than taking a strong stand on diversifying development in the province and saying, “Well, there are a couple of other locations in the province. There is Blind River, there’s Thunder Bay, and we will encourage development in those areas. They are both on major bodies of water.” There could very well have been this type of development in those two communities.

Of course, this government does not think the way we would think in terms of saying to the private sector, “Look, if you don’t want to develop the steel companies there, then we don’t give you the permit to build here. Also we will go there and build, since there must be a demand for the product, or you wouldn’t be building in the first place; therefore, we would be quite happy to go into competition with you.” I think the government would find that the attitude of the private sector would change considerably.

What’s really happening, Mr. Speaker, is that the domestic employment is not increasing through the mining industry. Productivity is, in an extremely dramatic way, but not employment.

We see the capitalization of the mining industry in Sudbury all the time. I don’t know whether the minister has ever been underground, but it is truly mind-boggling to see some of the equipment there. The size of the machines they call scoop trams is remarkable. They literally lift a roomful of ore in one scoop, and that does the work of a great many men.

I’m not suggesting, Mr. Speaker, that they shouldn’t be capitalizing, that they shouldn’t make it more mechanical underground and relieve men from digging with their picks and shovels. What I’m saying is that as long as that’s all that happens -- the increased capitalization of the mines in Ontario -- then it’s not achieving what we want from our non-renewable resources: namely, increased domestic employment and increased industrial development. That’s not happening, and it’s very simple to see why.

Mr. Speaker, just in case you might think that I was selective in my quotations by quoting the Canadian Tax Journal and quoting the Minister of Natural Resources’ own statistics, I’d like to quote from the article referred to by my colleague from Timmins. The title: “Super Tax: The Impending Crisis In Canada’s Mining Industry, And How It Will Affect All Canadians.” This was that gem brought out by the minister’s friends in the Mining Association of Canada.

In it they make three points -- they make a lot more than that, but there are three that I think really put it together very succinctly. Here they are talking about the increased tax and what it is going to mean to Canadians:

“A contrived slowdown in Canadian mining development based on a we’ll-get-a-better-price-later premise would force Canadian-based mining companies to accelerate their exploration efforts outside Canada. Indeed they would have no other alternative since mining companies must continue to explore to maintain supplies for customers.

“Once this trend occurs it tends to become irreversible. As developments proceed elsewhere, only the very high-grade mines will be developed in Canada and the industry would inevitably move away from expansion to a static position, then to a declining one. The mining communities, as well as the secondary and service industries that depend upon mining, would suffer severely. Jobs would be lost and disruption and displacement of large numbers of people would become a harsh fact of life.”

Mr. Speaker, when my colleague from Timmins used the word “blackmail” I don’t think that he was using any hyperbole at all.

The second point -- once again referring to what happens with increased taxation:

“The rate of growth would slow down, then halt altogether, basically because of the extremely long lead time involved in mine development; not unusually five to seven years. Some mines currently under development would probably be brought into production even in those provinces with the highest tax rates and other restrictions, since companies would seek to recover as much of their invested capital as possible. But plans for new mines, mills, smelters, refineries and secondary processing plants would inevitably be dropped if the two levels of government proceed with inordinately high levels of taxation.”

That’s laying it on the line -- I’ll say that for them. And finally, they say:

“So far we have developed only a fraction of our potential mineral wealth. New environmentally sound mining techniques will allow lower and lower ore grades to be mined, increasing our supplies enormously, but oppressively high taxes will cause our mineral reserves to shrink so that only higher-grade ores can be economically mined. Lower-grade mineral deposits will simply be left in the ground.”

There we have it in spades.

I don’t want to draw any silly comparisons, but it reminded me when I read that of a university course I took one time when I was reading the translation of Mein Kampf -- reading Hitler’s prognostications, or actually his promises, about what he was going to do. He then proceeded to carry on and do those very things. Here the government has the mining companies telling it exactly what they are going to do if it increases taxes on them.

And what does the government do? It goes umbrella in hand to the Mining Association and makes sure it doesn’t offend them any more than it has to.

I think, Mr. Speaker, what I’m really trying to say is that in a confrontation with the mining industry over taxation, the government simply cannot win. As the mining companies shed their crocodile tears, they’ll higrade, they’ll use their profits to develop them elsewhere, probably in the third world, and they’ll capitalize back here.

I wish the principle of the bill allowed a little more broad-ranging debate, Mr. Speaker. The antics of our resources corporations in the third world make me ashamed of the fact they are resident in this province. Their exploitation in Rhodesia, in Libya, in South Africa, is reprehensible. They pay their employees well below the poverty datum line as set out in the United Nations. They are hand in hand with the apartheid rulers of those countries --

Mr. Lewis: That would never concern the minister, would it?

Mr. Laughren: -- and this government does not see that as being part of the overall larger responsibility in terms of our resources. I know the profits that are earned here are used to explore and develop further in those countries exploiting the black people in the third world. Then the excessive profits they earn there, as a result of the minimal wages, are used to capitalize further back here. Round and round and round goes the capital, and never to the benefit of the working people either here or in the third world.

I don’t think we can dissociate ourselves from the antics of the resource corporations that are resident here, and what they do in the third world with profits that they earn in this province.

That’s really one of the things that bothers me most about our resource corporations. It is one of the reasons that I would be most happy if we could have our non-renewable resources under public ownership, because certainly then the pressure could be applied -- it wouldn’t even need to be applied; then there would be no case of the corporations owned here exploiting people in the third world.

I think too that the mining industry’s complaint about the level of taxation is misleading. When they talk about 73 per cent taxes, as the former speakers have pointed out, they really are not talking about 73 per cent because of the exemptions. I’d like to know the maximum level of taxation that any mining corporation pays, because I am sure I’ll be surprised. I think the Leader of the Opposition mentioned 60 per cent. I would be surprised if any company pays more than 40 per cent.

Mr. Lewis: How could they?

Mr. Laughren: I just don’t believe it. And yet we get these publications that would do the John Birch Society justice, screaming that it’s “Super Tax.” They haven’t convinced the people of Ontario, and I think it is a matter of time until everybody in this country says, “Hold the line on our non-renewable resources. That’s all we’ve got.”

The PMLC is one of the former Treasurer’s pet diversions, if I could refer to it as that, and nothing makes me angrier than to see the municipal officials in the Province of Ontario, particularly those municipal officials who are sitting on treasure vaults of resources, coming down here to Queen’s Park with their hats in their hands. I am embarrassed for them when they do that.

At the PMLC meeting in Sudbury in the fall the mayor of Sudbury expressed concern to the former Treasurer that perhaps the new tax levels would be harmful to the mining industry in Sudbury. I can tell you, Mr. Speaker, I wasn’t proud of Sudbury’s mayor on that occasion. I realize that he is probably going to be a Conservative candidate in the next provincial election, but I don’t think that did him justice.

Mr. Stokes: He is going to lose.

Mr. Laughren: Well, of course, he is going to lose.

And you know, Mr. Speaker, out of approximately $1.5 billion worth of production of minerals in Ontario, I see the International Nickel Co. getting more than we do in net profit -- $306 million in 1974 -- I don’t understand. I don’t understand how the minister regards that as being sensible at all.

It’s not a case of kicking International Nickel. It is the government that needs to be kicked. International Nickel fills out its tax forms the way it is told to fill them out. It’s those people opposite who allow them to do that, and it is hard for me to understand how, at a time when record profits are being achieved, the deplorable working --

Hon. Mr. Bernier: What did the member’s counterparts in Manitoba do? Introduced the bill and then withdrew it.

Mr. Lewis: As a matter of fact, they are toughening it, that’s what they are doing.

Mr. Laughren: We are going to take --

An hon. member: They’re in full retreat.

Interjections by hon. members.

Mr. Speaker: Order please. The member for Nickel Belt has the floor.

Mr. Lewis: What do you mean, “Order please”? It’s slander across the floor.

Mr. Speaker: Order please.

Mr. Lewis: Sid Green is even now toughening the bill.

Mr. Speaker: The hon. member for Nickel Belt has the floor.

An hon. member: Total freedom in both those provinces.

Mr. Laughren: And besides, Mr. Speaker, I am not the minister of mines in those provinces.

Hon. Mr. Bernier: The member is strong in opposition. If the member had the responsibility --

Mr. Laughren: When we form the government here -- the minister thinks that this is a strong document, the one called “Super Tax”? Wait until he sees what we put out when we form the government in Ontario.

Some hon. members: Ha!

An hon. member: We won’t live that long.

Mr. C. E. McIlveen (Oshawa): We’ll all be dead before the NDP forms the government.

An hon. member: He’ll wait a long time.

Interjections by hon. members.

Hon. W. A. Stewart (Minister of Agriculture and Food): He’ll never be around.

Mr. Laughren: Who won’t be around?

Hon. Mr. Bernier: The member for Nickel Belt.

Mr. Laughren: Oh, I see.

Mr. Speaker: Order, please.

Mr. Laughren: Mr. Speaker, the Minister of Natural Resources diverted me. I guess he sensed that I was going to talk a little bit about his ministry, because at a time when record profits are being recognized by the mining industry we have the kind of working conditions coming to light that are a disgrace and the Minister of Natural Resources stands condemned. The need for improved working conditions in the mines is such that the Ham commission that is going around the province now needs to be made a permanent commission. There is enough for that Ham commission to do that it can work full-time for the next 10 years. I would, of course, expand its terms of reference to include plants as well.

Hon. Mr. Bernier: What has that got to do with taxing?

Mr. Laughren: Pardon?

Hon. Mr. Bernier: What has that got to do with taxing?

Mr. Laughren: Well, I am just telling the minister that the same companies that are ripping off this $306 million a year in taxes have those kind of working conditions underground and in their plants and smelters. That’s part of the problem.

The minister doesn’t see a connection between profits and unsafe working conditions, does he? He doesn’t seem to realize that. In one breath he says that it costs too much money to make the mines safe and the next minute he says safe conditions have nothing to do with taxation. He is trying to suck and whistle at the same time, and he can’t do that.

Mr. Speaker, I drove up to Kirkland Lake on the weekend and, driving through those communities and talking to some of the people on the Saturday evening, I was struck by the similarity of complaints in those mining communities. There was a large number of people at the gathering and they represented a large number of the communities around there. They had the same kind of complaints that I hear when I go to Chapleau or Sudbury; namely, that sense of total neglect, the sense that despite what accrues to the mining companies nothing seems to be left in the community.

When I first went to Sudbury, Mr. Speaker -- I was not a native Sudburian, I moved there in 1969 -- I was really appalled at the lack of evidence of the enormous wealth of that basin. I looked around for the office towers.

Mr. Stokes: The city hall?

Mr. Laughren: I looked around for the kind of amenities that communities in southern Ontario have. One community I have often compared to Sudbury is Oshawa, with its population, and I think of some of the social amenities in Oshawa.

Mr. McIlveen: They have better councillors down there.

Mr. Laughren: The real difference, Mr. Speaker, is that you have real wealth being created in both communities and yet the city of Oshawa, because of the nature of the development of that city and the manufacturing, has been able to provide to its citizens a higher level of amenities than has the city of Sudbury.

An hon. member: A better hockey team too.

Mr. Laughren: Now if the member for Oshawa is going to tell me --

Mr. Speaker: Order, please; order, please.

Mr. Laughren: Could we allow an interjection from the member for Oshawa, Mr. Speaker?

Mr. Speaker: If it is important.

Mr. McIlveen: There are far superior elected officials in Oshawa.

Mr. Ferrier: With the exception of the provincial House.

Mr. Stokes: That’s the Pilkeys down there.

Mr. Lewis: The Pilkey influence; Pilkey, Michael Breaugh and others.

Mr. Speaker: The hon. member for Nickel Belt will continue.

Mr. Lewis: Breaugh, yes.

Mr. Laughren: That’s right. We could go back a ways.

Mr. Lewis: The government will be seeing a lot of him.

Mr. Speaker: Order, please. The hon. member for Nickel Belt will continue.

Mr. Lewis: Well, who is stopping him, except the Speaker continually interrupting?

Mr. Laughren: Yes, how dare you allow an interjection from the member for Oshawa?

Mr. Lewis: His first recorded statement in the House.

Mr. McIlveen: No, I had one other.

Mr. Laughren: Mr. Speaker, probably the issue that drove it home to me most clearly was the Elliot Lake situation, where we had enormous wealth in that community, and we have seen the thanks, we have seen the rewards which the miners received in Elliot Lake. That truly crystallizes the confrontation between what is best for the people of Ontario and what is best for the mining industry.

It is remarkable that in this bill, which allows for increased revenues to the province, there is no allowance whatsoever for any of it to be returned to the community.

I am not suggesting, Mr. Speaker, that we start applying finances from where they are obtained, because I, for one, don’t believe that all revenue from liquor sales should be put back into liquor advertising or into campaigns such as that. What I am saying is that despite the fact that northern Ontario, from whence these resources come, has given this province this enormous wealth, it has received in return for it the back of the hand from this Conservative government, and that just is not good enough. If the Minister of Natural Resources really cared for the people who work in the mines under his jurisdiction, there could easily be set up some kind of trust fund by the mining companies to apply to those people who suffer from compensation problems, compensable industrial injuries or illnesses.

The Minister of Natural Resources does not see fit to do that. He obviously has not convinced the Treasurer that there needs to be something set up for the workers in those communities for a number of reasons. One, because of the high incidence of industrial diseases and accidents; two, because of the depletable aspect of that industry.

Instead of giving the mining companies a depletion allowance, it should be going to the communities. Perhaps that’s one way of still allowing the depletion allowance to be recorded, but have it diverted to the community. Not the corporation tax, not the mining tax, but the depletion allowance. Surely it’s insane to pay the private sector to deplete our resources. Somebody’s going to have to explain to me the sanity of that.

Oh, I know what the minister will say. He’ll say, “That’s to allow them to explore and develop new resources.” Where? In Rhodesia? But that’s what’s happening. I don’t see any insistence that a certain proportion of the profits of the company remain in the community to develop the Province of Ontario.

Surely what we’re going to see in Ontario is the continued kind of imbalanced growth that we’ve seen in the past. How does the government justify, in a 120-mile strip of land from Niagara-on-the-Lake to Oshawa, the kind of development that’s occurring now? Thirty miles wide and we’re going to have a couple of million new people in that area by 1995. In the meantime, the figures for northern Ontario are truly startling. Mr. Speaker, I recall that between 1961 and 1966, which were the latest figures I could obtain from Statistics Canada, there was an out-migration from every single region of northern Ontario.

I am not talking, Mr. Speaker, about population. Put aside for a moment natural population growth -- births and deaths -- and think for a moment of the number of people who come into a community versus the number of people who leave a community. In the province as a whole, something like 250,000 more people entered than left. For northern Ontario and every single geographic region as laid down by the province, there was an out-migration. When you total the out-migration figures for all northern Ontario, it comes to 52,500. That’s how many more people left the various regions in northern Ontario than came into them during that five-year period.

That’s some kind of redressing the imbalances of growth in Ontario. This government’s attempts to balance growth and its attempts to diversify are in tatters -- there is nothing left of them. Until they show some political courage and say they truly are going to provide incentives for development in the north and disincentives for development in the south, then they’re not going to turn the present rate of development around. Surely that’s in the best interests of the entire province.

Mr. Speaker, I’ll get back to the principle of the bill. At the same time that International Nickel was rolling up these $306 million in profits, almost simultaneously the Ontario government announced the $100 million investment in Syncrude in western Canada. I started thinking for a moment of what that $100 million could do. The answer came to me in a flash, Mr. Speaker, and I know the Speaker would want me to share this flash with him. That was, that if the provincial assessment of the International Nickel Co., which is roughly $70 million, and the provincial assessment of the Falconbridge Nickel Mines, which is roughly $15 million, were added together it comes to roughly $85 million. That’s the provincial assessment of their operations in Sudbury. For $85 million, Mr. Speaker, we wouldn’t be buying a pig in a poke in western Canada, we’d be buying two viable mining operations in the Sudbury basin. Yet this government looks the other way when the municipal people --

Mr. R. Haggerty (Welland South): The member for Cochrane South didn’t say to nationalize that, did he?

Mr. Laughren: The member for Cochrane South isn’t speaking now, I am.

Mr. Haggerty: But the member for Nickel Belt is taking a different approach.

Mr. Laughren: No, not at all.

Mr. Lewis: Not at all. I will tell the member something, the member for Nickel Belt realizes we have to get more for the money than we do; and he knows how to go about it.

Mr. Speaker: Order, please.

Mr. Laughren: The member for Cochrane South was at the Sudbury convention and voted in support of the resolution, we all did. As a matter of fact that resolution in Sudbury passed unanimously.

Mr. Lewis: That’s right.

Mr. Speaker: Order, please. Will the hon. member return to the principle of the bill?

Mr. Laughren: I must say, Mr. Speaker, there was not one single resolution passed unanimously at the recent Liberal convention. As a matter of fact, there wasn’t one single resolution passed.

Mr. Lewis: As a matter of fact, there were no resolutions. As a matter of fact, there was no convention.

Mr. Young: In other words, the leader is to lay down policy.

Mr. Laughren: The leader will lay down the policy at the appropriate time.

Mr. Haggerty: In the fullness of time.

Mr. Speaker: Order, please.

Hon. A. Grossman (Provincial Secretary for Resources Development): When did he lay that down?

Mr. Laughren: In his leadership eulogy.

Hon. Mr. Grossman: He laid it so flat no one will ever be able to recognize it.

Mr. Laughren: Is the Provincial Secretary for Resources Development standing up?

Hon. Mr. Grossman: I hope the member for Nickel Belt will never die. I will never be the shortest again.

Mr. Laughren: That’s good enough to close on, yes. Maybe I will do that

I couldn’t close though, without making a plea, and that is to have, for the first time, some kind of committee or organization set up within the Ministry of Treasury, Economics and Intergovernmental Affairs to take a serious look -- I don’t think it has ever been done -- at the problems of the resource communities and whether or not it is possible to divert a portion of revenues from the mining corporations to those communities.

At one time there was something called mining revenue payments. That was not a tax, I don’t think, on the mining companies. That was just a diversion of provincial revenues to the communities. That was done away with, and we now have something called resource equalization grants.

But the word “grant” goes down the wrong way with me. I really find it remarkable that all those communities in northern Ontario are still coming down here and pounding on the Treasurer’s door, month after month after month. I would like to know, Mr. Speaker, just what the regional chairman of Sudbury’s annual airplane bill is between Sudbury and Toronto. I can assure you there are not very many weeks he is not down here; and the reason is always the same, he either has a cap or a tin cup in his hand.

Hon. Mr. Grossman: Does the member mean he didn’t come back with any money?

Mr. Lewis: If the provincial secretary gave him the money he wouldn’t have to keep coming back.

Hon. Mr. Grossman: They are not going back with any money?

Mr. Laughren: They are going back with some money, but does the provincial secretary know how they are getting it? By pleading with the government despite the fact that we sit on a virtual treasure vault of wealth in the Sudbury basin.

Mr. Lewis: If the government gave him the money he wouldn’t have to sue Jonathan Manthorpe, for heaven’s sake.

Hon. Mr. Grossman: He never got to it in the first place.

Mr. Speaker: Order, please. I wonder if the hon. member for Nickel Belt would return to the principle of the bill?

Mr. Laughren: Yes; well that was an intriguing interjection and I really would like to comment on it, but I will restrain myself.

Mr. Speaker, this bill still provides too many exemptions. The private sector obviously is still paying the piper because it is obviously calling the tune. It is not enough. We feel this government is not acting in the best interests of the people of Ontario, and we suspect that it is because their commitment to the private sector is greater than their commitment to the people of Ontario as a whole. Thank you, Mr. Speaker.

Mr. Speaker: The hon. member for York Centre.

Mr. D. M. Deacon (York Centre): Mr. Speaker, in connection with these mining tax amendments, I would like to make a few comments with regard to facts I think should be carefully considered by the government with regard to any changes in the mining tax situation.

I have heard a repeated reference tonight to the big tycoons and the multi-national corporations. I have heard a constant reference to these in a manner that doesn’t seem to really relate them to the individuals in this province. I think we should remember that they really represent, in their total ownership of these mines and what they get out of it individually, a very small minority of the actual ownership and benefit of mines. The vast majority of the ownership and benefits are in the hands of hundreds of thousands of individuals who have life insurance, who have moneys in pension funds, who have mutual funds or directly own shares through the investment of their savings.

The mining industry and the more remote parts of Ontario have been developed by enterprising prospectors and also enterprising people with savings. Instead of buying colour TV or other consumer goods or whatever are the popular goods of the day, they invested their savings hoping they could gain and have something for the future, and in doing so they opened up our north country.

Mr. Ferrier: The member should say “in addition to” rather than “instead of.”

Mr. Deacon: The fact is the alternative would have been for us to invest our own tax funds, our government dollars in the enterprise. I haven’t seen evidence in any province, or any part of this country or any other country, where a government enterprise has really given any sort of efficient or effective means of developing any sort of resources.

Mr. Young: Less than 10 per cent of the people own shares.

Mr. Deacon: The member is talking about less than 10 per cent of the people owning shares. He is not correct. When we talk about investment, a large number have shares through their life insurance premiums and their pension funds, particularly those two areas are a major source of savings in this country.

Mr. Young: Oh, but they get no benefit out of those.

Mr. Speaker: Order, please.

Mr. Lewis: Does the member realize that when BC bought into West Coast Transmission the share value went up?

Mr. Speaker: Order, please. The hon. member for York Centre has the floor.

Mr. Lewis: If we bought a controlling share of International Nickel, we would get a better return.

Mr. Deacon: I understand the point of what they’re saying, and whether they interfere or not we’ll get to that later on, as to what we might be doing to improve the confidence of investors and where government can ensure that it can have a better understanding and a better share of what comes through.

I want to point out, though, that private enterprise is more than just International Nickel or Noranda or these big outfits. There are a lot of small outfits and there are a lot of small people who are affected by whatever we do to them.

I think it’s important that we realize when we set rules we should set rules that are not changed without pretty careful consideration of what those changes will do. After all there are some major risks involved in any sort of development, whether it be in mining, resource development or in other types of development.

To have a standard of living in a country we should be setting the rules, and I certainly agree the rules should include proper concern for safety and proper concern for reinvestment of funds in the community. I don’t disagree with those factors. And they should have a proper rate of tax; but let’s set those things and don’t drastically change them and upset the confidence of people who put up their savings in the middle of the game.

After all, it takes an average of about $25 million to find a mine. Sometimes they’ve been lucky and have found one with a few thousand dollars, but that’s very rare. It certainly is rare nowadays. It takes another good many millions of dollars -- hundreds of millions in many cases -- actually to get that thing into operation and get it producing and getting the dollars out to the investors.

The next thing we must remember is the very major changes in commodity prices. Last year when the former Treasurer brought in this tax change proposal the price of copper was $1.50 and he thought it was going to go higher. Where did it go to? It went to 65 cents in the matter of a few months. That’s quite a change in price. What had happened in the meantime is the same thing that is happening to aluminum and to several other metal commodity prices. There has been a major change in the markets in that period.

Hon. Mr. Grossman: They should have kept the member for High Park out of it. If they had kept him out of it, it would have been more stable.

Mr. Speaker: Order, please.

Mr. Deacon: It is a very soft market in aluminum and sales have dropped away off. Everything like that is subject to volatile markets and we must recognize that. That’s the second risk to which investors have to give consideration.

When we bring in sudden changes in taxes so that we do get well over the level of tax that was taken into account when a new mine is developed, then I think we have to recognize what we do to the most important people in this, that is those who put their money at risk, whether through pension funds or through life insurance policies or directly. Because here we have today many pension funds which are in jeopardy because the value of their securities have plunged -- sure they’ve plunged because of the general market levels and investor confidence in the world --

Mr. Young: The member is talking about free enterprise, so-called.

Mr. Deacon: -- but I am talking about the factor you have to have in every situation when you’ve got to liquidate funds and provide funds --

Mr. Young: It is a free-enterprise system --

Mr. Lewis: The member for York Centre is the only man who can make the Minister without Portfolio appear left of centre. I cannot believe this.

Mr. Deacon: Maybe so, maybe so.

Mr. Lewis: The Liberals are so right wing I can’t believe it.

Hon. Mr. Grossman: I just told him that.

Mr. Deacon: The NDP’s idea is that the only way a government can ever develop something is for --

Mr. Lewis: I cannot believe that the province will move to the right.

Mr. Deacon: -- the member for Scarborough West to be controlling some enterprise.

Mr. Speaker: Order, please.

Mr. Lewis: You don’t have to control it.

Mr. Deacon: The member doesn’t realize that this country has been built by enterprising people who have a choice --

Hon. Mr. Grossman: I just told him that.

Mr. Lewis: Did the minister just tell him that? I can’t believe this. Day in and day out --

Mr. Speaker: Order, please, the hon. member for York Centre has the floor.

Mr. Deacon: Right now we have a situation where a major mining company, like Noranda for example, which is selling at five times its earnings -- in order for it to raise new money for new development it would have to have a profit of 40 per cent before tax if the tax rate was 50 per cent. That certainly is an impossible thing for us to have to see in the way of a potential return to justify something --

Mr. Lewis: Now it is in defence of Noranda.

Mr. Young: What are Noranda’s reserves?

Mr. Deacon: The member thinks of reserves in terms of cash on hand, doesn’t he? They don’t have cash on hand. Reserves have to be mined before they get the cash out of it. They have to be developed and sold. Insofar as all these things are concerned -- whether it’s the oil companies or the mining companies -- they don’t always have the cash on hand to do all the things that the member thinks they should be able to do because they have millions or hundreds of millions on their balance sheets. They have to go and raise dough in the markets --

Mr. Lewis: Good Lord, it is just incredible.

Hon. Mr. Grossman: You can’t tell --

Mr. Deacon: I think it is incredible that the member thinks that magically somebody is going to --

Mr. Stokes: Boy, does this member ever make the Tories look good.

Mr. Deacon: Maybe I make them look good.

Mr. Speaker: Order, please. The hon. member for York Centre has the floor.

Mr. Young: Just keep him talking and you are going to reverse the thing over there.

Mr. Singer: A few lines from the member for Scarborough West and off they go.

Mr. Deacon: That’s right. My colleague from Nipissing pointed out to us an approach that I think should be considered by government.

Mr. Lewis: Stop taxing --

Mr. Deacon: That is that we start to invest the proceeds we get from royalties in the shares of the companies themselves --

Mr. R. S. Smith: That is not what I said.

Mr. Lewis: No, I said --

Mr. Deacon: -- and have a government interest in them -- buy into them. We’ve suggested that in a select committee report on the mining industry and I think that we have seen evidence of where this has worked very successfully to the profit of government and to the public and the shareholder.

This is in the case of British Petroleum and its development over the last 60 years or more. In 1914 the then Anglo Iranian Oil Co. found itself in severe financial difficulties and the UK government invested funds which gave it a 50 per cent ownership interest. At that time the government agreed that it would be a shareholder but it would not interfere with the operations of the Anglo Iranian company which is now called British Petroleum. It had a veto right over the appointment of the chairman and chief executive. It appointed two directors to sit on a board of about nine or 10, and it left control with the private enterprise part of the operation.

BP as a result has not been the normal type of state-owned, stifled operation -- it’s been a very enterprising and very successful operation. At the same time it has given the public, the owners, the citizens of Britain, a very profitable source of income over the years and one which has also given the government a greater understanding of what is going on in the oil industry itself.

To my mind this is an important approach that we should consider in order to build up the knowledge government has about what’s going on in industry -- whether it be the mining industry or any other type of industry. At the same time it would establish a rapport and a communication between government and private enterprise that I think is essential to the future development of our country.

I would like to point out to the minister that I hope in the future the government of Ontario will think about moving itself into an ownership position in partnership with the mining industry, in the same sort of way that the government of the UK did some 60 years ago in the oil industry.

I think this is something that could give us the best of both worlds; where we can ensure that the public is getting a fair share of the rewards, but through its government is also taking some share of the risks. In that way I am sure that we all can benefit greatly.

We support this bill; it is a modification and I think the government should think in terms of the effect of increases or changes in the tax levels. It should be doing so much more in consultation with those who invest savings so that we don’t have public confidence shaken to the extent that people don’t want to invest any of their savings, pension funds or other income in the development of our country. I think it’s a very important fact that we should take into account.

Mr. Speaker: The hon. member for Thunder Bay.

Mr. Stokes: Thank you, Mr. Speaker. I have listened with a great deal of interest to the debate thus far. We haven’t heard from any members from the government side, including the Minister of Natural Resources, who has an interest in this taxing legislation. I had hoped that some of the members from northern Ontario, particularly from the government benches, would have got up and expressed a point of view. It’s unfortunate that they haven’t thus far. Maybe it’s not too late yet.

I want to congratulate the Liberal Party on its ambivalence with regard to this piece of legislation. They say they support it in principle, but have a great deal of difficulty with many of the sections of the Act that they seem to be definitely opposed to.

Hon. Mr. White: No, I don’t think that’s fair. “Fighting Bob” came down tough on both sides of every argument he made tonight.

Mr. Stokes: Well, I’ve often wondered, every time I hear one of them get up to speak on a piece of important legislation like this --

Mr. Singer: Jealousy will get the member nowhere.

Mr. Stokes: -- how they manage to get over the fence without hurting themselves.

Mr. Singer: The common bond of jealousy.

Mr. Stokes: One of these days a foot is going to slip and there is going to be a catastrophe.

Mr. Deacon: They are not all bad over there.

Mr. Stokes: They are jumping from one side of the fence to the other; but mainly sitting on the fence most of the time.

Mr. Haggerty: The member for Thunder Bay is going to set us straight.

Mr. Speaker: Order, please. The hon. member for Thunder Bay is speaking.

Hon. Mr. White: He doesn’t listen very well, does he?

Mr. Haggerty: He’s going to nationalize everything -- even the government.

Mr. Speaker: Order, please.

Mr. Stokes: For anybody who knows as little about natural resources as the member for Welland South, he has a lot of gall even interjecting.

Mr. Lewis: That’s right, believe me.

Mr. Stokes: He has such unmitigated gall. If there is anybody who knows less about natural resources in this chamber, it’s got to be the member from Welland.

Mr. Speaker: Will the hon. member return to the principle of the bill?

An hon. member: This is the member for Welland South. The member for Welland (Mr. Morningstar) sits over there.

Mr. Stokes: Welland South.

Mr. Lewis: He just processes the resources that are found in the north.

Mr. Stokes: I think there has been only one piece of knowledge emanate from the speeches given thus far from members of the Liberal Party. It came from a northerner, the member for Nipissing. He highlighted what I think is the major problem of the mining industry from the perspective of someone from northern Ontario.

I think the Minister of Natural Resources is in a position, if he chooses to do so, to echo the sentiments of every member coming from northern Ontario -- regardless of his political stripe or his political leaning.

Has there ever been an industry that has exploited the resources of the north and left so little behind? Has there ever been an industry that has done it to the extent that the mining industry has done it? If there has, I wouldn’t know what industry it was.

When one looks at the inability of the communities that act as the dormitory community to tax and get a fair return from the mining activities to provide basic amenities for people who work in that industry and who provide well in excess of $2 billion worth of new wealth each year to the economy of this province, I don’t have to remind both the ministers, who are having a little tête-à-tête, about the incredible problems that mining communities are having and of the mining communities that have gone down the drain as a result of the depletion of ore reserves in so many communities throughout northern Ontario.

I am not competent to speak in a personal way about all of the problems of mining communities in northeastern Ontario. I am sure that there are other people in the House who can speak with a much greater degree of conviction and knowledge, having regard to that part of the province, than I can. But I can speak with some degree of knowledge, having regard for communities like Geraldton and Beardmore, which were communities that owed their being and their very existence to gold mining operations where the ore reserves have long since gone and so have the mining companies, along with any viability that they may have hoped for.

Ways and means have been suggested on numerous occasions in this House whereby the mining companies, at the urging of both the federal and the provincial governments, could have provided for the ultimate day when the mining companies would have walked out when those ores were depleted. The mining companies didn’t see fit to set up a fund to provide for some degree of viability after they moved out. The people who took up residence there and had a modest equity in their homes and the small businessmen who set up enterprises based on the mining wealth in that area have been left to pick up the pieces. And this is a government which presumably is the champion of the free enterprise system, the large and the small entrepreneurs.

I want to ask the two ministers what the former Treasurer and the Minister of Natural Resources have done to ameliorate the effects of the closing of mining operations where they have left the workers to hold the bag and to pay for whatever services they have in small communities. What has this government done to ameliorate the effects of the closing of a mining enterprise? It has done nothing but leave the small businessmen to pick up the pieces and offered no alternative of any consequence for them to remain viable as a community.

It’s very, very interesting to read an article in the Dryden Observer of Nov. 21, 1974, where they quote Mr. Norman H. Wadge, executive director of the Ontario Mining Association, when he says:

“We need development in northern Ontario and the time has come for government to implement the necessary far-reaching policies that will make the development a reality. To date, the mining industry has been by far the economic mainstay of northern Ontario and, given a reasonable stable tax climate, it will continue to be.”

Hon. Mr. White: The Liberals have all left the House. The member has driven them all out.

Mr. Stokes: That’s fine.

Mr. Lewis: He hasn’t driven them out.

Mr. Speaker: Order, please.

Mr. Ferrier: They talked about the fact that there were so few of the NDP and now they are all gone.

Mr. Stokes: Yes.

Mr. Speaker: Would the hon. member return to the principle of the bill and never mind the interjections?

Mr. Lewis: What do you mean? He never minds them.

Mr. Stokes: I thought I was right on the principle of this bill. It’s the interjections that are irrelevant.

Mr. P. D. Lawlor (Lakeshore): Why can’t you keep that fellow quiet, Mr. Speaker?

Mr. Stokes: I want to know from the two ministers over there who are responsible what has the mining industry done for communities in northern Ontario after it picked up its marbles and went home? What have the two ministers sitting there with grins on their faces done on behalf of mining communities in the north whose economy was based wholly and solely on the extraction of ore of all natures, whether it be base metals, whether it be gold or whether it be iron ore?

Mr. Ferrier: They have delivered the eulogy.

Mr. Stokes: Let me point out a situation that exists --

Hon. Mr. Bernier: There is more growth in Geraldton today than there was 20 years ago.

Mr. Stokes: Oh, but it is the service industry.

Hon. Mr. Bernier: Don’t play down Geraldton all the time.

Mr. Stokes: I am not playing down Geraldton, I know Geraldton very well. I know Geraldton a lot better than the minister does. Does he know what the prime industry in Geraldton today is?

Hon. Mr. Bernier: Forestry.

Mr. Stokes: No, it isn’t. The biggest single employer of manpower in the town of Geraldton right now is education.

Hon. G. A. Kerr (Solicitor General): All right, we can take credit for that.

Mr. Stokes: Getting back to the taxing structure in the Province of Ontario, I will tell the minister what the single most aggravating problem of the people of Geraldton is. It is the dormitory community for over 400 woodsworkers associated with the forest industry, but their tax mix is just simply scandalous. They can’t afford all of the social amenities that they have a right to but can’t pay for, because of their inability in the first instance to tax the gold mining industry and in the second instance their inability to tax the forestry industry. They are still a dormitory community as they were for the gold mining industry. They are now the dormitory community for the forest products industry and they don’t get a penny in direct tax from it.

Let me ask the minister how much easier it would have been for communities like Red Lake, a gold mining community, that owes its existence wholly and solely to the ability of those miners to extract ore at a profit, if they could tax the mining industry. I want to ask the minister how much the residents of Red Lake are paying for water and sewer. Could he please tell me?

Hon. Mr. Bernier: I believe it is under $200 a year.

Mr. Stokes: It is my understanding that it’s just a little over $300 a year, Mr. Speaker. Those are the figures that were provided me by the Ministry of the Environment under the provincial water and sewage plan.

How much easier would it have been for those people to underwrite the cost of providing basic services if they had the ability to tax the mining industry in a way that they too would bear their fair share of the cost of providing services to their own workers. Let me ask the Minister of Natural Resources yet another question.

Hon. Mr. Bernier: There is only one mine in the municipality of Red Lake and that’s been there for only a short period of time.

Mr. Stokes: I am talking about the area known as the Red Lake gold mining camp. It’s Balmertown, Cochenour and Campbell-Red Lake. I am talking about the people who live in that group of communities and their inability to tax directly or through funds provided by this government. At one time in our history we had the mining revenue payments. As inadequate as they were, at least they had something on a per capita basis that provided some stability for them.

Hon. Mr. Bernier: On a point of order, Mr. Speaker, could I just correct the hon. member? He is leaving a false impression with regard to the municipalities of Balmertown and Cochenour. The Cochenour community was established by the Cochenour Willans gold mine. I would invite the member to go up and see just what that mining company has done. A complete townsite was established by the company itself, a modern arena with artificial ice was completed, and special emphasis was given to assisting our native people.

The townsite was totally constructed by the mining company, the Cochenour Willans Mine.

Mr. Laughren: The minister is defensive for them, isn’t he? He sure defends them well.

Mr. Singer: This is not a point of order at all. What point of order is he talking about?

Hon. Mr. Bernier: Go over to Balmertown and see that community and its improvement district. It’s one of the most modern communities in the Province of Ontario -- again, assisted by the mining industry. But to sit there and say they’re not doing anything is entirely incorrect and I have to correct that.

Hon. J. W. Snow (Minister of Government Services): Right on. Right on.

Mr. Laughren: Isn’t he sensitive? He is so consistent.

Mr. Lawlor: If the minister wishes to join the debate he will have an opportunity.

Mr. Speaker: Perhaps the hon. member might continue his remarks?

Mr. Stokes: Thank you, Mr. Speaker. I am saying to the hon. members over there who think this is a great Act that they haven’t even scratched the surface in tapping the available wealth that’s generated by those residents of those communities, those who actually work in the mining industry. They haven’t even begun to tap the amount of wealth that is available to provide basic amenities for those people who are responsible for creating that new wealth.

Let me refer the House, Mr. Speaker, to a conference that was held recently in Quetico Centre, about 10 days ago, when the topic of conversation and our terms of reference were to outline our manpower requirements between now and 1980, as it pertains to the mining industry, the forest products industry, the tourist industry and the service industry. We had representatives from all of those industries. We had mine managers, we had pulp and paper managers, we had entrepreneurs, we had representatives from all of the major communities. And they were unanimous -- they were unanimous -- in the conclusion that both governments, federal and provincial, and all of the companies involved, if they were going to provide a stable work force, were going to have to pull up their socks.

We had people representing the mining company who said they had failed, that they hadn’t lived up to their obligation to provide a proper working environment and proper social amenities in their communities. The forest products industries came to the same conclusion. The elected representatives of all of the communities there said the same thing. There was a unanimous consensus that all of the companies had failed to provide a proper working atmosphere, not only to attract but once they did attract to retain the kind of people and the numbers of people, whether they be professional, skilled or semi-skilled, in order to provide for the tremendous amount of expansion we are capable of achieving in northwestern Ontario.

It may not be common knowledge to everybody in this House, but we’ve got over $2 billion in new expansion on the drawing board. A good deal of it is based wholly and solely on our ability to exploit, in an orderly way, both our mineral and our forest resources. If this government isn’t going to take it upon itself, first of all to collect the wealth, and then once it collects it, to retain it and direct it back into the north from whence it came, it isn’t going to have the degree of development that northwestern Ontario is capable of achieving.

These aren’t my words, Mr. Speaker. This is a consensus that was arrived at in discussions with officials from mining companies, with officials from pulp and paper industries and a broad consensus of the private sector, in co-operation with all of the municipal officials in northwestern Ontario.

All I’m saying is that if we are going to achieve those aims, if we are going to achieve the degree of development we’re capable of achieving in northern Ontario, we must provide services and social amenities in those communities, and the only way we’re going to be able to achieve that is by us, through this government -- and when I say us, I am talking about everybody living in northwestern Ontario, and I am sure the argument is equally valid in northeastern Ontario. If we are going to satisfy those who are presently living in northern Ontario, and those who we hope to attract to northern Ontario, the government is going to have to provide a quality of life that is at least equal to and better than is available any place in the Province of Ontario.

The only way the government is going to achieve it is by extracting from our extractive industries a sufficient amount of capital in order to be able to achieve those ends. They are not doing it at the present time; and if the government feels that it is getting a fair share of the mining activity in northern Ontario at the present time, it means that its priorities are way out of whack, because the quality of life in many, many areas of northwestern Ontario is going downhill at the expense of increased industrial and commercial development in other parts of the province that really don’t need it. It is only adding to the problems and the frustrations of gathering large numbers of people in a relatively few centres down around the “golden horseshoe,” and it is going to come back to haunt this government.

I am saying the government has an opportunity to reverse this trend; to divert that development up into northern Ontario where it is badly needed. I suggest the government do that by its taxing methods. It has it within its power to do it. The government has fumbled the ball up until now.

The only way it is going to accomplish that -- and it is something it is going to have to accomplish, or some other party will do it -- is by rearranging its priorities in order to get a fair share of the economic wealth that is being created daily by those workers in the mining industry in northern Ontario and diverting it back up to provide a quality of life that will make it more attractive for them to continue to live there and to attract even more numbers to live there to take care of the expansion that is on the drawing board. That’s the only way this government is going to get northern Ontario out of the doldrums and into the mainstream of social, economic and cultural development within this province.

I just have two other small comments that I want to make, and this is in reference to the complete neglect of the plea of the very, very small mining company in the Province of Ontario at the present time. This government doesn’t talk to any of the really small ones. I know there is something in there that says the first $100,000 are tax free, but does this government know that most of the major finds in the Province of Ontario at the present time weren’t found by these great big, sophisticated companies like International Nickel, Noranda and Falconbridge? They were usually found by some little guy going out and scratching with a pick and shovel. He would come up with what looked like an interesting bet. He did all the groundwork and then, after it had almost proved itself, some big mining company came in, took it over and developed it.

Hon. Mr. Bernier: What have the feds done about that?

Mr. Stokes: I don’t know what the feds have done for that.

Hon. Mr. Bernier: Killed them with their taxation policy.

Mr. Stokes: What I am saying is if this government is really and truly and sincerely interested in getting greater mining development in the north, it has to pay more attention to the little guy. And when I say the little guy, I am talking about the individual prospector.

Hon. Mr. White: This bill does this.

Mr. Stokes: Pardon?

Hon. Mr. White: This bill does this.

Mr. Stokes: No, it doesn’t.

Hon. Mr. White: Yes, it does.

Mr. Stokes: No, it doesn’t. There is not one penny of incentive for an individual prospector.

Hon. Mr. White: This is a tax bill which allows for a big write-off of preproduction expenses, which we have never done before.

Mr. Stokes: That’s assuming that he has got $50,000 or $100,000 of his own money to go out and do it.

Hon. Mr. White: It is a thoroughly good mining tax.

Mr. Speaker: Order, please. Does the member have further remarks to make?

Mr. Stokes: Yes, I have a few more remarks to make.

Mr. Speaker: Would the member care to move the adjournment of the debate?

Mr. Stokes moves the adjournment of the debate.

Motion agreed to.

Hon. Mr. White: It lowers taxes on all mining companies in the Province of Ontario with an annual profit of less than $1.3 million. Why doesn’t the member read the bill?

Mr. Laughren: The minister will get his chance.

Hon. Mr. Winkler: Before I move the adjournment of the House I would like to say that tomorrow we’ll proceed further with the consideration of this particular bill. There will be two others; there will be Bill 179 and Bill 118 to deal with, then the conclusion of the budget debate and the bill in accordance with that debate. I would assume we could look at something like Thursday, if the House feels that way, for prorogation.

Mr. Breithaupt: Could I ask the House leader before adjournment if any consideration is given to sitting on Wednesday in case that day would be necessary, depending on the outcome of the debate?

Hon. Mr. Winkler: Unfortunately I have to inform my friend that the cabinet will be meeting in Oshawa on Wednesday.

Mr. Lewis: There goes that seat!

Mr. Speaker: Order, please.

Hon. Mr. Winkler moves the adjournment of the House.

Motion agreed to.

The House adjourned at 10:30 o’clock, p.m.