Legislative Assembly of Ontario

The House met at 2 o’clock, p.m.

Prayers.

Mr. Speaker: The member for Port Arthur.

Mr. J. F. Foulds (Port Arthur): On a point of privilege, Mr. Speaker, in the debate on Tuesday last, in the evening, the Minister of the Environment accused me of not knowing what was going on in my riding.

Mr. L. C. Henderson (Lambton): Well it’s true.

Mr. Foulds: He subsequently said, on page 79 of the Instant Hansard:

“Dr. Pullan, a director of applied physics for the Ontario Research Foundation, our own lab experts and the dean of science of Lakehead University were meeting today and will continue to meet tonight to discuss the matter in your area.”

I know the minister did not do this deliberately, but he inadvertently gave a wrong piece of information to the House, as the scientists from Lakehead University were not invited to the meeting on Tuesday evening, which took place publicly, between his ministry officials, the ORF officials and the city council, at which time the ORF scientists attempted to discredit the findings of Lakehead University. I would like to put that on the record.

Mr. Speaker: The hon. member for Kitchener.

Mr. J. R. Breithaupt (Kitchener): Mr. Speaker, I am pleased to introduce to the House a number of students from Queensmount Public School in Kitchener, in my constituency, and I would ask the members to welcome them. They are, I think, the last of four or five groups which have now been able to visit the Legislature as part of their continuing interest in public affairs within the province. I’m sure the members will join with me in welcoming them to the House.

Mr. Speaker: The member for Fort William.

Mr. J. H. Jessiman (Fort William): On a more friendly note from Thunder Bay, Mr. Speaker, I would like to introduce to you, sir, and to the House, 35 students from St. Peter’s School in Thunder Bay south who are visiting us, in the west gallery, with their teacher, Mr. Cullen.

Mr. Speaker: The member for Humber.

Mr. N. G. Leluk (Humber): Mr. Speaker, on a point of privilege, the member for Ottawa East made certain allegations or inferences in an article which appeared in the Toronto Globe and Mail yesterday --

Mr. S. Lewis (Scarborough West): There were no allegations.

Mr. Leluk: -- that I was one of four members of this House who went to Taiwan in October, 1974, at the expense of the Ontario taxpayers and on government business.

Mr. A. J. Roy (Ottawa East): I never did say that.

Mr. Leluk: I just want to set the record straight that I was not there on government business and that it did not cost the taxpayers of this province one cent.

Hon. W. A. Stewart (Minister of Agriculture and Food): Wrong again.

Mr. Breithaupt: There are no allegations. We would just like to know.

Mr. Speaker: Order, please. I’m not sure that allegation was made, but the information is interesting.

Interjections by hon. members.

Mr. Roy: It seems to me, Mr. Speaker, when a point of privilege is made like that, allegations are attributed to me that I did not make. I simply asked the question: Did these members go, who paid for the trip and what was the purpose of the trip?

Hon. Mr. Stewart: The innuendo was there.

Mr. Speaker: I agree. The question was asked and there was no definite answer given. The record is now set straight, I would say.

Hon. Mr. Stewart: Cheap politics.

Mr. R. F. Nixon (Leader of the Opposition): Where has the Minister of Agriculture and Food been at the taxpayers’ expense that gets him so worked up?

Mr. Speaker: Order, please.

Mr. Lewis: Simple envy.

Mr. Speaker: Order, please. The member for Essex-Kent.

Mr. R. F. Ruston (Essex-Kent): Mr. Speaker, on behalf of the member for Essex South (Mr. Paterson) I would like to introduce grade 7 students from Colchester North Central School -- which happens to be the school that Kevin Webb, one of our pages here, attends -- and I would like the members to make them welcome.

Mr. R. F. Nixon: It must be an election year.

Mr. J. R. Smith (Hamilton Mountain): Mr. Speaker --

Mr. Speaker: An introduction? Yes.

Mr. J. R. Smith: Mr. Speaker, through you, I would like to extend a welcome to a group of 35 ladies from St. John’s United Church on Mount Hamilton.

Mr. Speaker: The hon. minister.

Hon. J. W. Snow (Minister of Government Services): Mr. Speaker, I would like to introduce to the hon. members a group of students from the New Central School in the town of Oakville, who are in the west gallery this afternoon, accompanied by Mr. John Merrifield.

Mr. Speaker: Statements by the ministry. The Minister of Industry and Tourism.

ONTARIO TRAVEL ASSOCIATION PROGRAMME

Hon. C. Bennett (Minister of Industry and Tourism): Mr. Speaker, I am pleased to announce an expansion in our Ontario Travel Association Programme, in recognition of the accomplishments of the 12 travel associations which are partially funded by the province.

On April 1, 1974, the ministry introduced a revised programme to fund local tourism marketing, research and development activities. The 39 former tourist councils were consolidated into 12 travel areas. Each travel association established under the Ontario Travel Association Programme is eligible for an outright grant from the province of $30,000 toward the administration costs, and $45,000 for cost-sharing moneys in their programme.

The cost sharing is determined on the basis of a 90 per cent contribution from the ministry for approved programmes in northern Ontario, a 75 per cent contribution in eastern Ontario and a 50 per cent contribution in the rest of our province. The administrative grant ensures the employment of full-time professional staff; the cost-sharing moneys ensure execution of sound marketing strategies and identification of development opportunities in their areas. This funding is, of course, only part of the assistance provided to these travel associations from our ministry.

We have been well satisfied with the associations’ accomplishments in the past year and have concluded that increased funding will provide more marketing services for the travel areas. I welcome this opportunity to announce that my ministry will:

1. Increase the cost-sharing moneys available to each association by $5,000, for a total of $50,000 on the current matching formulae basis.

2. Increase the administrative grants to each association by $5,000, for a total of $35,000.

When we began our review of regional tourism programmes in 1973, my ministry had a total budget commitment to the travel councils of $380,000, with actual expenditures amounting to only $260,000.

In this past year, we estimate that the expenditures will exceed $850,000 -- an increase of over three times the investment in local tourism. During the current fiscal year, our commitment is $1.2 million. We have moved in this direction in recognition of the need to develop strong local promotion in all parts of the province, and to increase local funding in support of tourism.

In 1974, these were the results: An increase in tourism by Ontario residents within the province of $175 million; an increase in travel from other Canadian provinces of an additional $45 million; an increase in US visitor spending of $117 million; an increase in overseas spending in Ontario of an additional $25 million; for the first time ever, Ontario’s tourist revenue broke through the $2 billion level -- an increase of 18.6 per cent over 1973.

My ministry has a commitment to improving the tourism plant in this province as well. Last year, through the development corporations in Ontario, the ministry gave direct financial assistance to 186 tourist operators in the province to the tune of almost $23 million. This compares with 57 loans granted in the seven years between 1966 and 1973 for something just over $2 million. A better plant, coupled with more aggressive local promotion though the Ontario Travel Association Programme, will result in further tourism revenue increases in all parts of this province.

Through the youth secretariat’s student summer employment programme, each association will hire six travel counsellors, one marketing assistant and one photographer. The salaries of these students are paid by the province, which, in effect, adds another $14,000 to the funds available to each association.

The Ontario Travel Association Programme moneys will go directly into our provincial tourism economy to meet the difficult challenges ahead.

Mr. Speaker: Statements by the ministry. The Minister of Transportation and Communications.

Interjection by an hon. member.

Hon. Mr. Bennett: The member for Ottawa East wouldn’t know much about it.

Mr. Roy: Tell me about it.

Mr. Speaker: Order, please. The hon. minister has the floor.

NORFOLK ROAD WORKERS’ DISPUTE

Hon. J. R. Rhodes (Minister of Transportation and Communications): Mr. Speaker, on April 17, the hon. member for Ottawa Centre (Mr. Cassidy), asked me a question concerning the situation involving the township of Norfolk and its employees. I will not repeat the question. It’s in Hansard as of that date. At the time I did not feel in a position to answer the question adequately. I would like to give the answer at this time and rather than take up the time of the question period do it in the form of a statement.

Mr. Roy: That’s a good idea.

Hon. Mr. Rhodes: Mr. Speaker, I’ve reviewed the submission from the township of Norfolk to become urban for road purposes. The request simply means that instead of the ministry sharing in the original purchase cost of the road equipment and subsidizing the operating costs, the municipality, as an urban municipality, will buy and own its own equipment without subsidy and the ministry will subsidize the operating costs on a rental basis.

As a matter of general policy, my ministry favours and encourages municipalities to go to an urban status for road purposes, particularly those local municipalities which now fall within a regional municipality.

With respect to the specific situation at hand, it is my understanding that the municipality reviewed the alternative of contracting out work instead of its present method of performing the majority of the work with its own forces. The results indicated that the former would result in a substantial saving to the township.

I have been given by the member for Ottawa Centre a petition signed by over 1,000 ratepayers of the township of Norfolk indicating, “That they are in favour of the road employees of the township receiving the same collective agreement as the road employees of the Haldimand-Norfolk region, township of Delhi, town of Simcoe and city of Nanticoke.”

Mr. Speaker, I do not believe that a decision with regard to the township going urban for road purposes will affect the bargaining position of either the township or its employees. I view this decision to be quite unrelated to the labour question. Changing status has no bearing on whether it decides to contract out the work or own and operate its own equipment. It is the municipality’s prerogative and it has this choice of whether the municipality is rural or urban for road purposes. The significant difference is that when a municipality goes urban for road purposes, we do not reclaim the ministry’s share of the original purchase cost of equipment whether the municipality keeps it or sells it.

My position with this municipality is no different from that with any other under the same conditions. The decision to not approve urban status would financially penalize all of the people in the township of Norfolk. I have therefore instructed my staff to approve of the township’s submission.

Mr. Speaker: Oral questions. The Leader of the Opposition.

NORFOLK ROAD WORKERS’ DISPUTE

Mr. R. F. Nixon: Mr. Speaker, I would like to ask the Minister of Transportation and Communications a question based on his statement just made.

Wouldn’t he think the fact that the application for urban status from the township concerned, which was approved -- perhaps not in a written way but it was affirmed by the department that approval would be forthcoming three to four days later -- was an indication that the township could go forward with its plans to do away with much of the employment it had habitually needed in the area and put its roadwork out to rental and tender rather than doing it itself? Wouldn’t the minister be afraid that at least in the minds of those people on strike in that community his decision given verbally some days ago and now affirmed in the House would be seen to be interfering with a continuing and more and more acrimonious labour dispute in that rural community?

Hon. Mr. Rhodes: Mr. Speaker, first of all, I did not give any verbal assurance that this sort of approval would be forthcoming. The verbal approval apparently came from the director of that particular branch of my ministry who was contacted. As I indicated in my remarks, the practice of allowing this change has become very simple, especially for a municipality within a region. It was not a strange decision on the part of the official to so advise the municipality that it would receive approval.

Following the question from the member for Ottawa Centre, I did look into it in more detail and found that really there is a labour dispute. It is being handled by the two parties in conjunction with the Minister of Labour (Mr. MacBeth) and it really didn’t involve my ministry. We would have been, I think, taking a position that was really not warranted to become involved in that particular dispute.

VISIT TO INDIAN RESERVES

Mr. R. F. Nixon: I’d like to ask a question of the Provincial Secretary for Resources Development. Has he been to Grassy Narrows yet or when does he intend to travel there?

Hon. A. Grossman (Provincial Secretary for Resources Development): No, Mr. Speaker, if the member will recall I said I was going this Saturday.

Mr. R. F. Nixon: This Saturday? I wonder if before he goes he could look into the reported research that’s been carried out at the Hospital for Sick Children in this town by Dr. Sarkar and Dr. Cox, who apparently have developed a procedure whereby through medication, very simply and safely applied, the heavy metal mercury can be removed very readily from the blood streams of those people who have ingested food with a heavy mercury content? Is he aware of that research and would he undertake to find out about it and report to the House since it would have such far-reaching ramifications for these Indian communities and others exposed to heavy metal pollution?

Hon. Mr. Grossman: Mr. Speaker, I’m sure my colleague the Minister of Health (Mr. Miller) is familiar with these matters to which the Leader of the Opposition referred. I’ll certainly discuss that with him before I go. Quite frankly, I tell the member our first concern at this particular time is to attempt to find a solution to the problem of substitution because of deficiency in protein in the people in that area. However, we are not excluding any of these matters from the discussion we are going to have with people in that area.

Mr. R. F. Nixon: A supplementary: While we would agree with the priority put by the minister now that finally he as provincial secretary has been brought into the field -- perhaps he can co-ordinate the inadequate efforts of his colleagues over the last four years -- surely he would agree that if this medical breakthrough has been accomplished we ought to be able to make use of it without delay? Will he report to the House his findings in this regard?

Hon. Mr. Grossman: Mr. Speaker, with the aid of my very adequate and very capable colleagues we’ll do whatever we can in this regard.

Mr. R. F. Nixon: His very adequate and capable colleagues have made a mess of this for four years.

Mr. Speaker: Any further questions?

ALLEGED COMPLAINTS ABOUT MINISTER’S TACTICS

Mr. R. F. Nixon: I have a question of the Minister of Housing, if I can have his attention for a moment.

An hon. member: He needs all the public relations he can get.

Mr. Speaker: Order, please.

Mr. R. F. Nixon: I would like to ask the minister if he can explain to the House why the mayor and the chief planner of the municipality of Mississauga have complained about intimidation tactics by the minister personally in support of his OHA programme? Why would they feel that his programme is a complete interference with the autonomy of that municipality in view of the fact that they have awarded building permits amounting to 35,000 units in the community and it cannot be said they are standing in the way of all growth? Perhaps they are only unprepared to accept the blandishments, now becoming the threats, of the minister?

Hon. D. R. Irvine (Minister of Housing): Mr. Speaker, I’m delighted to answer the Leader of the Opposition because --

Mr. R. F. Nixon: Good.

Hon. Mr. Irvine: -- it is a very misleading statement to make either in the press or in the House that I was --

Mr. Lewis: Right, he is stupid; he is wrong.

Hon Mr. Irvine: -- intimidating the mayor or his chief planner.

Mr. Lewis: The minister is not capable of blandishment, I will tell him.

Hon. Mr. Irvine: What I did suggest to the mayor was that the municipality of Mississauga has been dealing with me for several months on a particular piece of property for development. I had been requested by certain people to refer the matter to the OMB; I had also been assured by the mayor that the council would deal with the item as quickly as possible and it would go through. He told me in January that everything was going along fine. In February it was the same story and I think we reached the end of the rope when he finally said there had to be another study which might take six to eight weeks to complete: a study which was known full well by the mayor and the municipality, whether they were elected or appointed officials, right froth the beginning.

Therefore I suggested it was time we quit dragging our heels as I thought they were doing and we do something about trying to develop housing in Ontario, especially in this particular area. I asked the mayor, if be wasn’t going to resolve the situation, to say yes or no, one or the other. That’s all I wanted and then I was going to deal with the request before me to refer the matter to the OMB. It’s as simple as that.

Mr. Roy: I wish the minister would give answers like that, just yes or no.

Mr. Speaker: Any further questions?

Mr. R. F. Nixon: Yes, a supplementary: How can he approach a municipality under those circumstances when they are unwilling to accept his particular programme and the municipality has 15,000 serviced lots there now with building permits readily available? Sure they would want the province’s money but wouldn’t the minister agree that the problem in his approach in dealing with these municipalities, which he has criticized publicly and frequently in this House, is really a personal problem -- that in fact he is not going to be able to get an agreement with these people if he is going to try to coerce them with the kind of power that he feels he has?

Mr. Speaker: Order please.

Hon. Mr. Irvine: Mr. Speaker, I don’t believe the Leader of the Opposition has all the facts, because the municipality has accepted our housing programme. It has accepted $100,000 in a grant to assist it in preparing its official plans. It has said it would have housing in 1975 and not in 1985. Therefore, the municipality is in agreement with housing in 1975 and 1976. All I am asking is that it fulfil the agreement which it signed with us.

Mr. Speaker: Any further questions?

Mr. R. F. Nixon: I would like to ask the minister a further supplementary: Doesn’t it concern him that perhaps his own personality is intruding into the kind of settlement that all of us would like to see forthcoming?

Mr. Speaker: Order please.

Hon Mr. Stewart: No way, no way.

Mr. G. Nixon (Dovercourt): Get off it.

Mr. Lewis: That’s true. It is his essential sweetness. It just got in the way.

Mr. G. Nixon: The leader of the NDP doesn’t have any sweetness.

Hon. Mr. Bennett: What does the leader of the NDP know about sweetness?

Mr. Lewis: It’s the minister’s saccharine sweetness.

Hon Mr. Irvine: Mr. Speaker, I am always concerned about what image I might have. I would suggest maybe the Leader of the Opposition should be just as concerned as he suggests I should be.

Mr. Roy: The minister needn’t worry.

An hon. member: Another cheap answer.

Mr. Speaker: Any further questions?

ARESENIC LEVELS

Mr. R. F. Nixon: I would like to ask the Minister of the Environment whether he can announce that our standards for arsenic levels in the work place are going to be reduced at least to the level that has been in effect under the jurisdiction of the United States Department of Labour since Jan. 1, because our levels are six times as high as theirs?

Hon. W. Newman (Minister of the Environment): Mr. Speaker, I realize there has been research done at, I believe, Johns Hopkins University. In light of that, we discussed it with the Ministry of Health. No doubt there will be some changes in the standards.

Mr. R. F. Nixon: Supplementary: Since there was a story, I believe, in the Globe this morning from officials of the ministry indicating a reduction was at least possible, what is the delay in simply assuming at least the levels that other jurisdictions have found necessary for the safety of their workmen?

Hon. W. Newman: Mr. Speaker, I just said that in light of the recent studies that were done at Johns Hopkins University, we are having discussions with the Ministry of Health right now regarding reducing the emission standards of arsenic.

Mr. Speaker: Any further questions?

Mr. Lewis: I have two quick supplementaries on this issue. Is the threshold limit value in Ontario for arsenic 25 micrograms or 25 milligrams per cubic metre?

Hon. W. Newman: Is the member talking about in the air or in the water?

Mr. Lewis: In the air it would be 75 of one or the other.

Hon. W. Newman: I believe the air is 75 -- I stand to be corrected on that -- but I know the water is 0.05 milligrams per litre.

Mr. Lewis: Milligrams?

Hon. W. Newman: Yes, that is the criterion.

Mr. Lewis: The figures don’t compare but we’ll leave them for the moment.

Can the minister respond to that perhaps even more quickly than to the Johns Hopkins study?

Hon. W. Newman: Mr. Speaker, I am quite sure that my staff are aware of it. We have the experts on it. As I just finished saying, we are looking at the criteria for both the air and the water levels at this point in time. We are discussing it with the Ministry of Health.

Mr. Speaker: Any further questions? The hon. Leader of the Opposition.

FUNDS FROM OPEC COUNTRIES

Mr. R. F. Nixon: Just before the Treasurer leaves, can he tell us if his officials are negotiating with any of the OPEC countries for Arab funding of that $600 million that was left up in the air in his budget? He will recall that his predecessor travelled to some of those countries in the fall. Is the Treasurer or are any of the people in his ministry following that up? Are we actively pursuing that sort of borrowing in Ontario?

Mr. Roy: Lucky he did a report on it.

Hon. W. D. McKeough (Treasurer and Minister of Intergovernmental Affairs): Yes, we are actively following it up, not on behalf of the province but on behalf of Ontario Hydro.

Mr. R. F. Nixon: I wonder if the Treasurer could tell us what would the aim be for the first loan and when might we expect an announcement about it?

Hon. Mr. McKeough: In the fullness of time.

Mr. R. F. Nixon: A supplementary: Can we expect that money will be available to us at as much as three-quarters of a per cent less than it would be on another market, or perhaps saving more than that? Can he assure us we won’t face the same problem we faced after we borrowed the deutsche marks when revaluation did away with the substantial improvement of the interest rate?

Hon. Mr. McKeough: Mr. Speaker, all those details will be known when anything is consummated, and nothing has been consummated at this time.

Mr. Speaker: Any further questions? The member for Scarborough West.

POLITICAL ACTIVITY OF CIVIL SERVANTS

Mr. Lewis: I have a question first of the Chairman of the Management Board. What is he going to do about the case of Brian Charlton in Hamilton, who’s position probably has been brought to the minister’s attention -- indeed, the CSAO has written a letter directly to the minister -- in terms of the ultimatum he has received that either he stop his political activities, or he will be removed from employment; he will be fired tomorrow?

Hon. E. A. Winkler (Chairman, Management Board of Cabinet): Yes, that is correct, Mr. Speaker. The gentleman referred to did receive such notice. I believe the letter to which the leader of the NDP refers was probably delivered to him before it was delivered to me. Immediately I got it, I discussed the matter with the Minister of Revenue (Mr. Meen), in whose employ the gentleman is, and he has that matter currently under review.

Mr. Lewis: I would like to come back to the minister on it in this sense. I understand the Public Service Act, I understand how it reads, and I understand that this employee is, in fact, in a designated category. I understand and respect that. Can the minister then answer for me -- maybe I have to put this to the Minister of Revenue. Mr. Speaker, maybe I should put it to the Minister of Revenue.

We are discussing the Brian Charlton case, the property assessor in Hamilton. Can I ask the minister why, when a letter was sent five years ago, at the end of 1970, raising the question of political activity, to which Mr. Charlton gave a response, and then nothing occurred, and in the intervening five-year period he has been involved in everything from seeking a provincial nomination, to taking leaves of absence for conventions, to participating in campaigns with leaves of absence, to participating on executives of riding associations publicly noted, and in all instances for five years noted by his superiors or known by his superiors, how is it that suddenly in April, 1975, he receives a letter which begins, “It has come to my attention that you hold office in a local political organization and you must quit or be fired in two weeks.”

Hon. A. K. Meen (Minister of Revenue): Mr. Speaker, I’m trying to get to the root of this whole question at present. But my preliminary information is that none of us in the ministry, nor for that matter in the local assessment office in which he was engaged, actually was formally aware of the degree of his activity. It really only came to light when there was an announcement in the local press of his election as the president of the NDP organization in Hamilton Mountain.

Mr. W. Ferrier (Cochrane South): Does the minister apply the same standards to Tories and to Liberals?

Hon. Mr. Meen: Indeed, if I take that as a supplementary question, Mr. Speaker, indeed the answer is yes, on a number of occasions.

Mr. Lewis: I am not questioning that at all.

Mr. Foulds: No, not a number of occasions.

Hon. Mr. Grossman: Oh, yes.

Hon. Mr. Meen: Conservatives have been obliged either to resign from their posts and cease and desist from a breach of section 13 of the Public Service Act, or take the consequences of a dismissal from the civil service.

Hon. Mr. Grossman: Only in the NDP provinces they don’t have to resign.

Mr. Lewis: I have a supplementary. Doesn’t it strike you as strange, Mr. Speaker, not to say beyond belief, that a man who contested a provincial nomination publicly in 1971, who is president of the riding association for the third year in a row, with press attention each time, who has requested leaves to participate in political activity in conventions and councils and campaigns, and has managed those campaigns and been publicly noted in Hamilton -- is the minister trying to pretend for a second --

An hon. member: Who pays that much attention to each riding?

Mr. Lewis: Is the minister trying to pretend for a second -- look, if the government wants to uphold the law, let it do it; let it not do it on the eve of an election.

lnterjections by hon. members.

Mr. Lewis: Why does the minister think, after five years, they would suddenly move in on him?

Hon. Mr. Meen: Mr. Speaker, the point is that it is no use his suggesting that this has been going on for a number of years. I have told the hon. member that it only recently came to our attention on this point.

Mr. Lewis: I declare that false. That’s impossible.

Mr. Speaker: Order, please.

Hon. Mr. Meen: If the hon. member would care to tell me what correspondence he is talking about, going back to 1970, I would be pleased to see it because I have not seen any such correspondence. If the hon. member has it, I would like to see it.

Mr. I. Deans (Wentworth): Well, it is there.

Mr. Speaker: Order, please.

Mr. Lewis: On a point of privilege then or a point of information, interestingly enough, the same man who issued the letter requesting Mr. Charlton’s dismissal also wrote to him -- let me find it so that I am accurate, Mr. Speaker -- on Nov. 10, 1970: “Subject, The Public Service Act -- Political Service of Activity,” sending him the copies of the relative sections of the Act which he thought Mr. Charlton had transgressed at that time and asking for Mr. Charlton’s comments. How can a man who did that in November, 1970, not be aware of the subsequent political activity of five years?

Mr. Speaker: Any further questions?

Mr. Lewis: May I come back and ask the Chairman of the Management Board, does he think it is fair raising the fundamental issue that a property assessor 3 or indeed so many of the designated categories should be excluded from any political involvement at all in the Province of Ontario? Isn’t it appropriate with an election looming to amend the Public Service Act to give to the public servants of this province the same political rights as is accorded them in most other jurisdictions of the country, the federal government included?

Hon. Mr. Winkler: Mr. Speaker, I must say that I have had this schedule before me for a few days. I am reviewing it and I will be making a report to my colleagues on it.

However, I must say in conjunction with the questions that have been asked today that I knew nothing of the situation at all, despite what the leader of the NDP is saying here this afternoon. I knew nothing about it until that letter was delivered to my office yesterday afternoon. I want to say, if this man is looking for the NDP nomination in this particular instance, this is a poor way to get publicity.

Interjections by hon. members.

Mr. Speaker: Order, please.

Mr. R. F. Nixon: Can I ask a supplementary on that?

Mr. Speaker: Supplementary.

Mr. R. F. Nixon: Does the minister recall answering a similar question at a public meeting attended by myself and a representative of the NDP -- I am not sure whether it was the member for Scarborough West or the member for York South (Mr. MacDonald) --

Mr. Lewis: The member for York South.

Mr. R. F. Nixon: -- in which he said quite clearly that the government was moving toward changing this particular provision in this particular law which would open it up to certain levels, if not all public employees, to participate in the democratic process at all levels?

Hon. Mr. Winkler: Mr. Speaker, I think I answered that question just a few moments ago and it is precisely what I am doing.

Mr. Speaker: Does the member for Scarborough West have further questions?

Mr. Lewis: Yes, a related question.

Mr. J. R. Smith: Supplementary, Mr. Speaker.

Mr. Lewis: I have a supplementary on this. Mr. Charlton may or may not get a nomination; that’s irrelevant. I am asking the minister, in light of the review --

Interjection by an hon. member.

Mr. Lewis: -- he wants to make, can he hold off on the exercise of the dismissal until he has reviewed the designated categories to find out whether or not the government intends to amend the legislation?

Mr. E. J. Bounsall (Windsor West): That’s fair.

Hon Mr. Winkler: Inasmuch, Mr. Speaker, as I did receive notice, as I said, just yesterday, I have passed it to my colleague, the Minister of Revenue, for review. I am not going to stand here and say that I will withhold whatever action is legal in this particular instance.

An hon. member: It’s the law.

Hon. Mr. Winkler: But I will certainly act on the advice of my colleague.

Mr. Speaker: A final supplementary by the member for Hamilton Mountain.

Mr. J. R. Smith: Mr. Speaker, I would like to ask the Minister of Revenue if he could inform the House as to whether or not the regional assessment officer in the Hamilton-Wentworth area has advised other employees either verbally or by written statement in that office who support other political parties that they likewise must curtail or withdraw from political activities?

Mr. Deans: How would he know verbally?

Hon. Mr. Meen: Mr. Speaker, I know of no other incident of this nature and, therefore, I know of no other individual who might similarly have been advised of the conflict apparent under the Public Service Act. I have been advised by some of my colleagues that they are aware of similar incidences in their ministries in which they have had to take similar steps.

Might I just observe, though, in reply also to the member for Scarborough West, that I have been looking into this matter and I believe the letter from the regional director had indicated termination as of tomorrow, April 25.

Mr. Lewis: That’s right.

Hon. Mr. Meen: I have instructed that that date be postponed until I can have a further inquiry into it.

Mr. Lewis: That’s right.

Hon. Mr. Meen: I was not aware of that letter of Nov. 10, 1970. That does pre-date by upwards of a year the categorization of the assessors in this area --

Mr. Lewis: That’s right.

Hon. Mr. Meen: -- and therefore may or may not have been appropriate to the circumstances as they subsequently developed. That’s one of the things we are looking into.

Mr. Lewis: I am not sure it was either. It is the funny sequence that bothers me.

Hon. Mr. Meen: There’s nothing sinister about the funny sequence, I can assure the member.

Mr. Speaker: Any further questions by the member for Scarborough West?

Hon. Mr. Grossman: The member doesn’t mind making it look sinister.

Mr. Lewis: Well, I wonder about it. I wonder about it.

Mr. Speaker: Order, please. Could you place your other questions?

Mr. Lewis: I have a question of the Minister of Health. Now that the minister has been granted his liberty by the Provincial Secretary for Resources Development -- he said, “You wanted the flak, you can take it”; he was very gracious to the minister -- then what about the question of the --

Hon. Mr. Grossman: Mr. Speaker, I rise on a point of order.

Mr. Speaker: A point of order.

Mr. Lewis: I knew I shouldn’t have done it.

Hon. Mr. Grossman: No, the member shouldn’t have. It’s quite apparent the hon. member would do what he can to divide my colleagues from each other.

Mr. Lewis: They are so easily divisible.

Hon. Mr. Grossman: The question was asked of me by a newspaperman. He said: “You know your colleague has complained of the flak he has to take without any authority.” I said: “If he has to take the flak, he now has the authority,” which is quite a different implication from what the hon. member is trying to put on it.

Mr. Speaker: I fail to understand it. The member for Scarborough West.

Interjections by hon. members.

USE OF HAZARDOUS CHEMICALS

Mr. Lewis: Is the Minister of Health feeling better, now that solidarity is reinstated? Good. Now, can I ask him, in terms of the statement that was made, what might he be able to do in the announced Petrosar development to protect in advance the workers from the use of benzene, the major chemical factor in the Petrosar development, when it has now been shown that 140 documented cases of benzene-induced leukaemia are scientifically noted, and indeed the government of Italy has banned benzene as a solvent in the process? Also, what will the minister do about the use of TDI -- I cannot pronounce it; it’s toluene diisocyanate -- which is an effective inducement of asthma? Both of these dangerously harmful chemicals are major ingredients of the whole Petrosar development.

Hon. F. S. Miller (Minister of Health): Mr. Speaker, the member started out by talking about the flak. I don’t recall anybody giving me the alternative of not having the authority or the flak.

Mr. M. C. Germa (Sudbury): That could be arranged.

Mr. R. F. Nixon: We are working on that.

Hon. Mr. Miller: I now have them both. I might say I am pleased to have them both, because I hope and trust that this will result in the integration that we feel is essential in attacking problems like those the member has mentioned.

I think aromatic hydrocarbons of the type he has just discussed have been recognized in series to be carcinogens. I can only, at this point, take the standards that are recognized as being tolerable and see that they are going to be, in fact, maintainable within that factory as we come on stream and police it.

As I understand the authority, while the Ministry of Health will not be the inspecting agency, except where it suspects something wrong -- in other words, we will be an overseeing agency -- we will have the authority to request shutdowns, changes or whatever may be required and I am quite prepared to do so.

Mr. Lewis: By way of supplementary, will the minister, as part of his mandate, be willing to examine and to test every single chemical substance that is planned for the Petrosar development prior to its actual use?

Hon. Mr. Miller: Mr. Speaker, if, in fact, the determination of dangerous chemicals was based on a simple study in a lab that could produce results in a short time frame, I wouldn’t have the problems I have. When we bring out this paper on Elliot Lake in the near future, one of the comments we will make in it -- I think I am revealing no breach -- is that we won’t know for X years whether certain measures have been effective. Sadly, that is the story of occupational health; it’s a historical method rather than a predictive method.

There are groups of chemicals -- and the hon. member named two, benzene and TDI, both of which are similar -- and we know chemicals in that group traditionally have been carcinogens, so we have reason to suspect.

Mr. Speaker: Any further questions?

The member for St. George.

RENT SUPPLEMENTS

Mrs. M. Campbell (St. George): Mr. Speaker, my question is of the Minister of Housing. Would the minister explain to this House why Ontario is the only province in Canada that has registered objection to full sharing with the federal government in the rent supplement programme?

Mr. Deans: They don’t like renters.

Hon. Mr. Irvine: Mr. Speaker, we have been endeavouring to get an agreement with the federal government for weeks and even months. Our proposal has been before the minister responsible, Mr. Danson, and I am waiting for his reply. It’s not the province.

Mrs. Campbell: A supplementary: Is it not a fact that the only point between the two governments is that Ontario does not wish to share in the portion of the interest payments that needs to be subsidized? And isn’t it a fact that those agreements are on the minister’s desk or in his ministry now, and not at the federal level?

Hon. Mr. Irvine: No, it’s not a fact as far as I’m concerned. It certainly isn’t on my desk, and to my knowledge it isn’t on my deputy’s desk, unless it arrived today and I haven’t seen it.

Mrs. Campbell: I see. Well, the minister had better check.

Mr. Speaker: A final supplementary. The member for Riverdale.

Mr. J. A. Renwick (Riverdale): A supplementary question of the Minister of Housing: Recognizing that the rent supplement is a three-level problem, what exactly is the state of the agreement between the Province of Ontario and the city of Toronto with respect to rent supplement programmes in the city itself?

Hon. Mr. Irvine: Mr. Speaker, the same condition applies to the city of Toronto or any other municipality: we have to get an overall agreement worked out with the federal government. We made a proposal some while ago, as I said to the member for St. George, and I’m quite prepared to proceed forthwith with the city of Toronto as soon as I have an agreement to our proposal from the federal government. If they agree, I am prepared to sign today.

Mr. Renwick: By way of further supplementary, Mr. Speaker, does that mean there is no agreement with the city as yet and that the minister is waiting until the federal government and the provincial government reach agreement before he will negotiate with the city of Toronto on these matters?

Hon. Mr. Irvine: I don’t believe we have a problem as far as the city of Toronto or any other municipality is concerned. Our problem in the past has been with the federal government. Once I have that agreement, we can proceed forthwith.

Mr. Speaker: The member for Windsor West.

AMBULANCE SERVICES

Mr. Bounsall: A question of the Minister of Health, Mr. Speaker: With regard to the impending amalgamation of all the ambulance services in Toronto to form the Metro Toronto department of ambulance services, can the minister ensure that the employees of the five private services affected and the ministry’s own employees from the York-Toronto ambulance service -- all of whom are to be added to the Metro Toronto department of emergency services ambulance group -- without doubt will have transferred with them their seniority positions, their wage scales, their vacation entitlements and their pension and sick leave credits, and further that the transfer of all six employee groups will take place simultaneously so that a fair bargaining agent representation vote can be taken of the new combined group of employees?

Hon. Mr. Miller: Mr. Speaker, I can’t make those guarantees to the hon. member. These matters are being discussed. I received a letter from the CSAO on the subject within the last day or so. I’m sure that in the background work that’s going on between my ministry and the Metropolitan Toronto corporation, the whole issue of these rights is being negotiated, and I trust it will be done fairly.

Mr. Speaker: The member for Nipissing.

Mr. R. S. Smith (Nipissing): I have a question in regard to the Wintario lottery. Everybody who has to do with it seems to have disappeared --

An hon. member: Including the Premier (Mr. Davis).

Mr. R. S. Smith: Perhaps I’ll direct a question to the Minister of Transportation -- no, here comes the Chairman of Management Board. Would he accept a question in regard to the Wintario lottery?

Hon. Mr. Winkler: Certainly I will.

Interjections by hon. members.

ONTARIO LOTTERY

Mr. R. S. Smith: Is the minister aware of the problems of distribution of the tickets across the province that is being created, particularly in northern Ontario where a Mr. J. P. LaBelle has been given the distribution rights and has been provided with 52,500 tickets? He has not followed the instructions of the Ontario Lottery Corp. in the distribution of those tickets, in that he stands to realize a profit of $3,500 every two weeks, or about $85,000 per year.

Will the minister inform me if this is going to continue, or if the man is going to be made to distribute the tickets properly, and will the minister look into the amounts of moneys that are being paid to these people in regard to this distribution?

Hon. Mr. Winkler: That question interests me, Mr. Speaker, because I am having a dickens of a time getting a ticket myself. However, I wonder if the same gentleman had the distribution authority on the Olympic lottery.

Interjections by hon. members.

Hon. Mr. Grossman: All Liberals.

Mr. R. S. Smith: I have a supplementary.

Mr. Speaker: The member for Nipissing.

Mr. R. S. Smith: Mr. Speaker, Mr. Drapeau’s appointing him has got nothing to do with it. I would like to know if Mr. J. P. LaBelle is still going to be the Tory candidate in Nickel Belt riding.

Interjections by hon. members.

Hon. Mr. Winkler: I certainly wouldn’t think so, but I must say that I will take the balance of the question as notice and give it to my colleague.

Hon. Mr. Grossman: The feds make mistakes too, eh?

Mr. R. S. Smith: Mr. Speaker, will the minister take the first question as notice, because it is very important.

Mr. Speaker: I am sure the minister will take all of it as notice.

Mr. Roy: Supplementary.

Mr. Speaker: On that particular question?

Mr. Roy: On that particular question, and the minister’s reply about the agent having the agency for the Olympic lottery.

Hon. Mr. Winkler: Win a few, lose a few. That’s the way it is.

Mr. Roy: Would the minister look into the situation in Ottawa as well, where the distributor in the Ottawa area apparently is not, first of all, an Ontario resident? Second, he is a distributor for Olympic lottery and he stands to make about $100,000 a year over and above the Olympic lottery.

Hon. Mr. Bennett: It has already been looked after.

Hon. Mr. Rhodes: It is all looked after.

Mr. Roy: Is the minister not concerned that the real winners in this lottery are going to be the distributors and not the fellow whose ticket is drawn?

Interjections by hon. members.

Hon. Mr. Winkler: Mr. Speaker, I want to tell you who the real winners of this lottery will be -- the people of Ontario.

Interjections by hon. members.

Mr. Speaker: The member for Wentworth.

DIRECTOR OF COMMUNICATIONS FOR MINISTRY OF HOUSING

Mr. Deans: Mr. Speaker, I have a question of the Minister of Housing. What is it that the minister expects that this PR man that he has hired is going to be able to do that isn’t already being done by the PR people in the HOME programme or by the voluminous press statements coming out from his ministry that will be worth $32,000 and will enable him to sell to the public his inadequate housing programmes?

Mr. Breithaupt: He won’t sell it that cheap!

Hon. Mr. Irvine: Mr. Speaker, I know that the press releases we have had in the past have been very good; they have been excellent.

Interjections by hon. members.

Hon. Mr. Irvine: But the problem is this. We have had in the past someone responsible for communications for North Pickering and someone for communications for OHC, someone responsible for communications for the Ministry of Housing. We are reorganizing and co-ordinating all of the efforts in regard to communications and we want a director to handle this assignment.

I can’t say to the hon. member that we will have fewer staff, but it is quite possible; we are looking in that direction. It may be that it will be much less costly than in the past. But certainly what I want is a qualified man, and if we have to pay $32,000 to get the qualified man, I am quite prepared to do so.

Mr. Deans: A supplementary: Is the minister dissatisfied with the public’s reaction to the press statements that flow out from all of these various parts of his ministry and from his own office -- sufficiently dissatisfied to recognize that it is not press statements he needs but houses for people?

Mr. Lewis: How about a little affirmative action rather than a qualified man?

Hon. Mr. Irvine: Mr. Speaker, as far as the Ministry of Housing is concerned we have had a lot of affirmative action in the past few months, and we are going to have a lot more in the next few months. I want to tell the member right now that we have had adequate press releases, but what I have found is that many municipalities are not fully aware of all our programmes. I want the people of the municipalities to take advantage of them. A case in point could be the Ontario Home Renewal Programme; I have gone around this province and found that many municipalities have not really known exactly what the programme was about. I think it’s up to the municipalities to be involved in every programme the Ministry of Housing has.

Mr. B. Newman (Windsor-Walkerville): A supplementary?

Mr. Speaker: We are just about out of time and I think there are several people who wish to ask new questions. I think we should get to them first. If there is time left we will come back to that previous question.

The member for York-Forest Hill.

SPADINA ARTERIAL ROAD

Mr. P. G. Givens (York-Forest Hill): I would like to ask a question of the Minister of Transportation and Communications. Now that he has so brilliantly solved the problem of the intermediate capacity transportation system for Ontario, when does he intend to respond to the application of Metropolitan Toronto which has been sitting on his desk now for many weeks with respect to the disposition of the Spadina ditch?

Mr. Jessiman: Why doesn’t the member for York-Forest Hill drown in it?

Hon. Mr. Rhodes: First of all, Mr. Speaker, I want to thank the member for recognizing the brilliance of the intermediate capacity solution.

Mr. Roy: Listen to the applause. The applause is indicative.

Hon. Mr. Rhodes: Secondly, the matter concerning the application from Metropolitan Toronto is being discussed with my colleagues and I will have an answer for Metro in the reasonably near future. I discussed the matter as well with the chairman of Metro not too long ago.

Mr. P. Taylor (Carleton East): In the election campaign.

Mr. Speaker: The member for Stormont.

PROPOSED OIL REFINERY IN EASTERN ONTARIO

Mr. G. Samis (Stormont): Mr. Speaker, I have a question of the Minister of Industry and Tourism. Could be bring the House up to date as to the status of the proposed oil refinery at Morrisburg?

Hon. Mr. Bennett: Mr. Speaker, very obviously the member for that area hasn’t been listening to the remarks. I was asked casually by the mayor of Belleville whether there had been any inquiries by petroleum companies regarding refineries or establishments of that nature in that part of the province. I said we had very cautiously been discussing the subject with several people who had expressed some interest, related to the refinery process, in locating in the eastern part of the province.

I was very careful to indicate that in no way, shape or form was it a positive position. It was an inquiry to which our ministry was responding. They had asked where some of the locations might be in eastern Ontario and we had offered some suggestions and advice to them. At no time did I indicate positively that there would be a refinery in that part of our province.

Mr. Roy: Would the minister know?

Hon. Mr. Bennett: I would know a lot more than the member for Ottawa East. I can assure him of that.

Mr. Samis: A supplementary.

Mr. V. M. Singer (Downsview): A supplementary.

Interjections by hon. members.

Mr. Speaker: The member for Downsview. A supplementary? Order, please. We will allow the member for Stormont one supplementary since he asked the original question.

Mr. Samis: Thank you, Mr. Speaker. Since a public meeting was held at Morrisburg recently and the town solicitor as well as the reeve of Morrisburg said they had no way of finding out who was behind the proposed refinery, could the minister inform them, since the ministry officials said they couldn’t find out who was behind it? Could he inform the House?

Mr. Roy: Careful now.

Mr. Lewis: It’s not a lab assembly as the minister knows.

Hon. Mr. Bennett: Mr. Speaker, our Ministry of Industry and Tourism deals with a great number of industries in the Province of Ontario, various parts of Canada and from many countries of the world, which would like to establish new operations in this province.

Mr. Roy: The minister has a big job.

Mr. Samis: Don’t give us that.

Hon. Mr. Bennett: A great number of them come to us -- if opposition members would listen for a moment rather than babble as they usually do when they go out on to the public platform -- these people come to us to try to secure some information.

Mr. Roy: The minister has a big job, an important job.

Mr. Renwick: The minister is not speaking to the Rotary Club here.

Mr. Lewis: None of the members over there is very nice.

Hon. Mr. Bennett: Generally, their inquiries are on a confidential basis and that is the way it is maintained by our ministry.

Mr. Renwick: The minister is not in Los Angeles. He is in that political forum now.

Hon. Mr. Bennett: If at any time we were to start disclosing who is discussing certain problems with us we would lose that credibility with the industrial operators in the province and those who wish to come to us.

Mr. Roy: The minister would be off his nut to do that.

Hon. Mr. Bennett: We do not disclose to municipalities or to others, with whom we are discussing the problems until they have made up their minds as to what position they wish to take or direction they wish to go.

Mr. Breithaupt: Not a word can be told.

Mr. Renwick: Until the minister and business have decided.

Mr. Lewis: Does he think the Legislature is one big Lion’s Club?

Hon. Mr. Bennett: I didn’t speak to the Lion’s Club. Will the member for Scarborough West get it straight?

Mr. Speaker: The member for Downsview.

POLICE DRUG RAIDS

Mr. Singer: I have a question of the Attorney General if I can get him out from behind there. He was there a minute ago. Here he comes.

In view of yet another apparent abuse of civil rights by the RCMP -- under the provisions of the Narcotic Control Act this time when they descended on a young lady who was getting ready to take a bath and broke down the door in the city of London -- the same thing happened in St. Catharines in the Landmark incident, the criticisms by His Honour Judge Pringle in the Landmark report; the apparent comments and promises by the hon. Otto Lang, the federal Minister of Justice; can the Attorney General advise whether anything is being done to amend those terrible provisions in the Narcotic Control Act? What representations has the Attorney General made to try to get that Act cleaned up so that people’s civil rights will be protected?

Interjections by hon. members.

Hon. J. T. Clement (Provincial Secretary for Justice): Mr. Speaker, I’m in shock to hear the member for Downsview referring to federal legislation in those kind of terms.

Mr. Singer: It is bad legislation.

Hon. Mr. Clement: My predecessor wrote to the hon. Otto Lang last May or June expressing his concern about the provisions of the Narcotic Control Act; and I think the Food and Drugs Act has similar legislation. I’ve read of the incident involving the Royal Canadian Mounted Police, over which I have no jurisdiction.

Mr. Singer: It took place in our province.

Hon. Mr. Clement: It apparently took place in our province. This is one of the anomalies we find with matters being prosecuted by federal police relating to federal legislation. But now that we’ve got that all out of the way, I do have in my possession a letter from the hon. Minister of Justice telling me that he is introducing amendments to the two Acts this session that will impose the reasonable and probable clause provisions that so many members of the bar and the bench and public have expressed concern about. I did receive a communication from him, I believe a week or 10 days ago. It was also the subject of discussions at the Attorneys General conference in March, and I’m looking forward to those changes coming forth.

Mr. Singer: Will the minister make an urgent request that it be done as quickly as possible?

Hon. Mr. Clement: Yes.

Mr. Speaker: The member for Sandwich-Riverside.

EMPLOYMENT PROSPECTS OF HANDICAPPED PERSONS

Mr. F. A. Burr (Sandwich-Riverside): A question of the Minister of Labour: What progress has the minister made towards improving the employment prospects of handicapped persons in this province?

Hon. J. P. MacBeth (Minister of Labour): Mr. Speaker, I’m afraid there is very little to report, as far as I can determine at this point. However, the ministry is investigating what we can do.

Mr. Speaker: Order please. There is too much conversation coming over that mike. Would the members please restrain themselves from talking so the hon. minister can be recorded?

Hon. Mr. MacBeth: I know this is very dear to the member who has just asked the question, and I have given him my assurance that I will take some progressive action on it very shortly, sir.

Mr. B. Newman: Supplementary, Mr. Speaker, will the minister consider implementing Bill 19, that I introduced, and which would resolve the problem?

An hon. member: Of course, right away.

Hon. Mr. MacBeth: Mr. Speaker, I’m not that familiar with Bill 19, as I perhaps should be. But I’ll undertake to look at Bill 19 and see whether there is anything that we can incorporate into the government bill.

Mr. Speaker: The Minister of Transportation and Communications has the answer to a question asked previously.

QUINN ENTERPRISES

Hon. Mr. Rhodes: Thank you, Mr. Speaker. On April 21, the hon. member for Downsview asked a question of my colleague, the Minister of Revenue. The question was as follows:

“Since the minister is apparently not familiar with the various appearances of Quinn before the Ontario Highway Transport Board, could he undertake to inquire into those appearances, and discuss with his colleague, the Minister of Transportation and Communications (Mr. Rhodes) and perhaps with Mr. Shoniker, Quinn’s various appearances there and determine whether or not it is reasonable that Quinn should have successfully opposed over a number of years applications of others for PCV licences, in order that he keep those others who were truck owners serving him, rather than being able to serve themselves?”

Mr. Speaker, the Ontario Highway Transport Board has reviewed its files dated back to the beginning of 1972, and we find that Mr. Quinn opposed an application by Reliable Transport on March 5, 1973, for an extra-provincial operating authority to carry general commodities.

I understand that the application was granted by the Ontario Highway Transport Board upon hearing all the evidence. I’m advised there has been no other opposition filed by Mr. Quinn on any other application.

Mr. Speaker: The oral question period has expired.

Petitions.

Presenting reports.

Hon. Mr. McKeough presented the annual report of the Ontario Economic Council for the year 1974-1975.

Mr. Morrow from the standing procedural affairs committee presented the committee’s interim report which was read as follows:

Your committee recommends:

1. That for the present session, substitution of members be allowed at all meetings of all standing committees, provided that all substitutions are communicated to the chairman in writing prior to the meeting and that each substitution be for that day only.

2. That the procedure in the House which allows the stacking of divisions be permitted in any standing committee provided that such stacked divisions be voted upon prior to the adjournment of the committee on that day or the adjournment or completion of the bill or ministry estimates under consideration.

Mr. Speaker: Shall this report be adopted?

Mr. R. F. Nixon: Mr. Speaker, I’d just like to say one word about it. I realize that the committee has discussed it at length and this is their recommendation, but I still feel that the substitution changes are by no means fully adequate. The provision for substitution during the term of a meeting -- that is, during the day -- does not seem to be clear, other than for the day following. It would seem to me that we ought to accept the principle, on the basis of the distribution of members in the House, that we could have the votes distributed in the committee in such a way that we would have a much freer participation.

Regarding the second recommendation, allowing stacking, we have no particular objection as long as it simply doesn’t leave the Tory members the right to be absent from the committee all day and come in at the end to carry the day with their votes. We hope this is not going to lead to any further lessening of the importance of the committee system, which in fact should be emphasized and not depreciated.

Mr. Renwick: Mr. Speaker, on the question of the stacking of votes in standing committees, the present practice in the Legislature is that a vote can be called by any party without stacking, and I wonder what the rule will be in the standing committee to ensure that all votes do not necessarily have to be stacked. I would hope the chairman would comment on that part of the stacking procedure in his reply.

Mr. Speaker: Does any other member wish to make a comment before the chairman replies?

Mr. Deans: Is the member for Ottawa West the chairman?

Mr. D. H. Morrow (Ottawa West): Yes.

Mr. Deans: I would like to comment on one other matter. I think it is absolutely imperative that there be a method found for recording the events --

Mr. Morrow: Mr. Speaker, on a point of order, this particular part of the motion moved by the House leader hasn’t been dealt with yet in the committee. We discussed it for two days but we haven’t dealt with the matter.

Mr. Deans: But they are going to?

Mr. Morrow: That’s right.

Mr. Speaker: Any further comments?

Mr. Morrow: While I am on my feet, Mr. Speaker, in reply to the Leader of the Opposition and to the hon. member for Riverdale, I would like to point out that all members of the committee unanimously approved of this particular report. There is really nothing in the substitution that prevents anyone from substituting on a given day, provided he gives the chairman notice in writing. There is nothing to hinder any member from speaking to any particular subject as long as he notifies the chairman. Each party will report to the chairman before the meeting starts, so there will be no confusion during that committee meeting for that day. Then we can start over again the next day if there are any substitutions.

In reply to the hon. member for Riverdale, I might say that our recommendation is simply intended to allow the same procedure that is allowed in the House to be used in the committees. If they want to clear off a vote, that’s fine. If they want to stack them to the end of the day, that’s fine. But on one point we do differ from the House procedure in that we want to clear off stacked votes each day and not hold them over until the next day.

Report agreed to.

Mr. Ewen from the standing private bills committee presented the committee’s report which was read as follows and adopted:

Your committee begs to report the following bills without amendment:

Bill Pr11, An Act respecting the city of St. Catharines.

Bill Pr12, An Act respecting Sheridan Place.

Bill Pr13, An Act respecting the township of Goulbourn.

Bill Pr14, An Act respecting the city of Ottawa.

Bill Pr25, An Act respecting the township of Bruce.

Mr. Speaker: Motions.

Introduction of bills.

LIQUOR CONTROL AMENDMENT ACT

Mr. Samis moves first reading of bill intituled, An Act to amend the Liquor Control Act.

Motion agreed to; first reading of the bill.

Mr. Samis: The purpose of this bill, Mr. Speaker, is to enable independent, owner-operated grocery stores to sell beer and apple cider.

An hon. member: That sounds reasonable.

Mr. Speaker: I recognize the member for Wellington South.

Mr. H. Worton (Wellington South): Mr. Speaker, before orders of the day, I would like to have the opportunity to welcome to the Legislature, and have the members also welcome, a group of ladies from the Beta Sigma Phi Guelph chapter who are here today to witness the operation of the Legislature.

Mr. Speaker: Orders of the day.

GIFT TAX AMENDMENT ACT

Hon. Mr. Meen moves second reading of Bill 32, An Act to amend the Gift Tax Act, 1972.

Mr. J. H. Breithaupt (Kitchener): Mr. Speaker, my remarks at this stage of the bill will be quite brief. We are prepared to support the bill as, in our view, we are prepared to accept the continuation and development, particularly in these areas that are being benefited under this bill, of exemptions for gifts of farming assets where they are going to be used in farming. The other particular increases that have been developed to allow both the transfer of shares of small active business corporations, and also the increases in the annual exemption for gifts, are matters with which we concur. There may be some particular questions when the bill comes before us in committee, but those, I think, are sufficient remarks for the points I would make at this time.

Mr. Speaker: The member for Riverdale.

Mr. J. A. Renwick (Riverdale): Mr. Speaker, in the interest that I always have of expediting the business of the House and not being unduly long in my contribution, I want to make a few extended remarks on this bill, which will apply equally well to the other bill related to the taxation of wealth in the Province of Ontario, which I understand will be called immediately following this bill, that is, Bill 31, the Act to amend the Succession Duty Act. Mr. Speaker, in speaking to Bill 32, an Act to amend the Gift Tax Act, which we passed in this assembly in 1972, I will also, because they are both bills relating to the taxation of wealth, deal with Bill 31, An Act to amend the Succession Duty Act.

It is our intention to oppose both of the bills. Although we will divide the House only on the Act to amend the Succession Duty Act, being Bill 32, our opposition to that bill should be comprehended to include opposition to this bill. As I stated, it is only in the interest of expediting the business of the House that I make that distinction.

I know that the bills will go into committee. I understand it is the intention to put these bills into committee of the whole House -- I take it that the minister is about to nod his head in agreement -- in which case the specifics of the particular clauses can be dealt with by us at that time.

Let me right at the outset make a caveat from the viewpoint of this party and of this caucus representing our party. Within the context of the two bills which are before us, but only within that limited context, we are in favour of the extension of the exemptions provided for the small active business and for the family farm. It should be very clear that we support those aspects of these bills within the existing context of the kind of taxation of wealth, if one can call it that, in the Province of Ontario at the present time. We supported it at the time they were originally introduced into the House with respect to the family farm. We support the extensions and we support the application of those provisions as they are reflected in these bills to what is to be defined as the small active business. But the principles of both bills, amending as they do and extending to a great extent the exemptions granted under the bills with respect to the taxation of wealth in the province, we oppose and we oppose continuously. We have opposed the amendments over the years and we continue to oppose them. I want, for a few minutes, to speak about that.

First of all, I think it is fair to say that any taxation of wealth in the country, in Canada, must be a federal matter. We have always felt it was unwise for the federal government to abdicate its responsibilities with respect to the taxation of wealth by withdrawing from the estate or inheritance tax field and by withdrawing from the gift tax field.

The result has been that we, as a party supporting as we do the federal system in its most positive aspects, object very strongly to the federal government’s abdication, which has permitted an aspect of competition to exist between the various provinces so that some provinces have been trying to establish themselves as tax havens in the field of taxation of wealth at the expense of other provinces.

We think that in principle it is wrong. We do not think that each of the jurisdictions within Canada should be in competition with each other to determine whether or not they can attract wealth from one jurisdiction to another jurisdiction. That, in our view, is destructive.

Our first point, therefore, is that we deplore that abdication, as we have on other occasions, by the federal government.

Mr. P. G. Givens (York-Forest Hill): Have they really abdicated? Isn’t that more apparent than real?

Mr. Renwick: Well I don’t for one moment believe that it is more apparent than real.

The result -- and I say this to the member for York-Forest Hill -- is that over the period of the last 10 years there has been a substantial erosion of the provisions of the taxing measures applicable in Ontario, be they federal or provincial, with respect to the taxation of wealth.

The net effect for practical purposes has been that in this day and age there is little, if any, taxation of wealth. There is little, if any, recognition that one aspect of taxation, the ability to pay in an equitable society, relates as well to capital assets as it does to income. I will perhaps deal further with that in a few minutes.

Mr. Givens: What about the capital gains tax?

Mr. Renwick: I say, again to my friend the member for York-Forest Hill, that a capital gains tax is not a tax on wealth. A capital gains tax, if one reads the Carter commission and the philosophy of taxation, is not a tax on wealth. Now I want that to be understood. That is why it is in the Income Tax Act of Canada. Under the Carter commission report, and under any philosophical understanding of a tax system, that is not the taxation of wealth.

It is interesting, and coincidental, because certainly it had nothing to do with this ministry introducing these bills at this particular time, that the federal government, apparently, has now recognized a degree of concern with respect to the concentration of wealth and therefore of economic power in the business sector, by the appointment of the royal commission which has just been announced, undoubtedly directly flowing from the attempt by Power Corp. to take over Argus Corp.

That’s one aspect of an overall problem that we have been concerned with in this party for many years. It is the question of the concentration of wealth. Where wealth is concentrated, there also is economic power concentrated; there also is social power concentrated.

Mr. P. D. Lawlor (Lakeshore): There also is political power.

Mr. Renwick: And there also, as a necessary consequence, is political power.

Mr. M. C. Germa (Sudbury): And corruption.

Mr. Renwick: I will leave Hansard to record the remark of my colleague, the member for Sudbury.

It therefore seems to us that at this point in time, being faced again with another amendment to each of these two Acts, we must take a stand and say to the government where the New Democratic Party stands and what our position is with respect to the taxation of wealth. And I now want to try to say, in a few words, what our position is.

Our party is committed to use the taxation system to promote greater social and economic equality. This requires a redistribution of wealth as well as income.

The members who were here on Tuesday night will recall that I spoke at that time on the amendments to the Income Tax Act. At that time I drew the attention of the assembly to the statistical evidence supporting the proposition that, using the quintile system for slicing income distribution in Canada, regardless of the so-called social welfare provisions, regardless of the transfer payments which have been made, the relative positions of the five slices of the population with respect to the distribution of income has not changed over a 25-year period.

I was interested, indeed flattered, on that particular occasion when the Minister of Revenue (Mr. Meen) evinced a certain interest in the information which I tried to convey to the House. I intend to send him the background papers supporting the information which I laid on the table with respect to the distribution of income in Canada, in the hope that with the resources of the government we can get some factual information about the distribution of income and the relative positions of the various quintiles of the population of the Province of Ontario taken from those figures. We do not have the resources to do it. At least that information is available. At least the information on which one can find out the conclusions or draw the conclusions is available.

We don’t have any information in Canada, in the Province of Ontario, to identify privately-owned wealth. There is, to my knowledge, no way in which that information can be ascertained by Statistics Canada or by anyone else; and that poses an insuperable problem. I would surmise, although we do not know, that in the last 25 years there has been a substantial concentration in the distribution of privately-owned wealth in Canada and in the Province of Ontario.

Therefore, Mr. Speaker, we in this caucus are calling for a thoroughgoing reform of the taxation of wealth. The bill before us, the companion bill on the Succession Duty Act and the history of the piecemeal amendments to the Succession Duty Act in particular, and since it was introduced in 1972 the Gift Tax Act -- constituting in all a frontal attack and a substantial destruction of our taxation of wealth -- mirror the need for such a thoroughgoing reform of the taxation of wealth.

One of the main purposes of personal direct taxation, Mr. Speaker, is to share out the burden of taxation fairly in accordance with the principle of ability to pay. In this country we have come to think of income as the main yardstick of taxable capacity and have sought to promote a greater equality through a progressive income tax. However, income by itself is not an adequate measure of taxable capacity.

The ownership of wealth, whether it produces income or not, adds to the economic resources of a taxpayer so that the person who has wealth as well as income of a given size necessarily has a greater taxable capacity than one who has only income of that size. Our present tax system takes little account of this fact. Once the additional taxable capacity, represented by ownership of wealth, is adequately brought into charge, the inequalities in wealth will in time be eroded.

Let me say that when we call for a thoroughgoing reform of the taxation of wealth, we are speaking about a wide-ranging public discussion of such a reform. It appears to us that the day is long since past that tax reform, particularly in the field of taxation of wealth, is a matter to be left solely to tax experts and to the bureaucracy of government to decide whether or when it should be introduced.

We, as a government, would commit ourselves -- and we would call upon whichever party is the government of the province following the next election to commit itself in advance of that election -- to the preparation of a green paper to provide a basis for the widespread discussion of this whole question of wealth taxation.

Let me illustrate some of the questions which came to my mind that must of necessity be discussed in this immensely difficult and complex field of taxation. What is the precise form that the tax should take? What is the extent of the coverage? What is the extent to which the net should be drawn for the taxation of wealth? What are the appropriate exemption limits? What are the rates at which the tax should be levied on successive slices of wealth? What is the interaction of the wealth tax with other taxes to ensure that the total tax liability of any individual is not unreasonable in all his circumstances?

There will be questions of the impact of such a tax on businessmen -- to whom I referred at the outset of my remarks, the small active business corporations -- and upon the family farmers. Those questions must be weighed with the greatest of care. In the end, we must be guided by what is fair and what is administratively possible.

The wider intention of our proposal is to make Ontario, indeed Canada, a fairer place to live in. To achieve this, a wealth tax must itself operate fairly.

After a suitable period of public discussion of a green paper, we would propose -- and we would ask each party in this House to say -- that after the next election a select committee would be set up to examine the whole matter. Finally, of course, this assembly would have to approve the precise form of the wealth tax.

Therefore, Mr. Speaker, our caucus opposes this bill and the companion bill, which are before the assembly this afternoon. Not, I reiterate, because of the provisions related to the small active business corporation or to the family farm, but because this bill is the culmination of the destruction of the taxation of wealth in Ontario. If it is not the culmination, it’s the penultimate step in the culmination of the destruction of the taxation of wealth in Ontario.

We in this party do not deny that even to measure the distribution of privately-owned wealth, let alone to tax it, involves difficult conceptual and statistical problems for which adequate information is not available. That must not deter us. The social end commands us to proceed as I have tried to outline on behalf of this party.

The fundamental purpose of the wealth tax would be to make the distribution of the tax burden accord more closely with taxable capacities and thereby contribute to the creation of a more equitable society in which social divisions, characterized by differences of wealth, are reduced, and in which social and economic power -- and if I may borrow the interjection a few minutes ago by my colleague the member for Lakeshore -- and political power created by the possession of wealth is less concentrated than at present.

For these reasons, Mr. Speaker, we in this caucus, speaking on behalf of the New Democratic Party which we represent in this assembly, oppose this bill on second reading and will divide the House on the companion bill when it comes before the assembly.

Mr. Speaker: The hon. member for Lakeshore.

Mr. Lawlor: Thank you, Mr. Speaker. “We have not failed, but only because we have always gone on striving”: A quotation from the “Four Quartets” of T. S. Eliot. That is the only vindication I know for our continued insistence, our continued malaise in rising year after year in this House with respect to this particular kind of measure, to oppose what this government does with respect to emasculating wealth taxation. There are many people with a great deal of wealth who pay very little income tax, we all know that and it’s a scandal in the United States. If the facts were known in this country it would be equally a scandal, and perhaps more so.

At what stage and where do we finally move, in the name of the public and the public realm; those of whom they fed for their lifetime, those who have conferred the benefit? They live in the community and it is out of that community that they derive their money. Must they return nothing in terms of hard cash?

The irony of the thing, which would turn the mind of Montaigne, it’s so radical an irony, Mr. Speaker, is that they won’t even be able to curse you or forgive you, or do anything about you -- you’re dead.

This is the finest form of taxation -- Lawlor had very much to do with it -- it’s a primary form of taxation, where you tax, with the least pain, those who are in the subsequent generations.

How the wealthy dote upon their children, apparently, so that they want to hand on the use of it. It’s a way of self-perpetuation; I suppose it’s a submitted form of egotism. This is the only way, through the medium of money, that their memory will be indelibly installed in the mind for all future generations, or something like that.

What fatuity, what a myth! If that’s the bind they have with human relationships, then I am afraid it will disappear about three hours after they are dead, which is normally the case.

And so why not move in on this particular area? Those who are getting the benefits have done nothing to deserve it; an accident of birth. Those who have been able to acquire the wealth have obviously been able to find stratagems, loopholes and various methods of garnering and retaining it against the common weal and common purposes.

My friend has said the turnover in the income picture, with the trust that presently exists, does not allow this. Some day we may, with a royal commission and that green paper, get in on the basis of wealth taxation as a whole; with interrogation of the foundation concept in this province and how it operates. And it would be very much in order.

It’s an aggressive field; it lies there fallow. No one ever mentions it. No one ever scapples it, interrogates it, sees how it is misused against the public as a pure device, as a conduit pipe, by which to escape. Every wealthy man in the United States, from Carnegie on, has set up his own personal foundation for perpetuation of his memory and for his personal self-aggrandizement; as I say, not knowing quite how he enjoys the vision in another life.

The remarks I am making at the moment are, perhaps, more pertinent to the succession duty bill. But, as the minister well knows, this bill is collateral to the other. We didn’t have a gift tax in this province until Smith recommended it and the select committee of this House, in 1969, placed it forward as a positive proposal. A couple of years after that, the government finally brought in a Gift Tax Act, so that they wouldn’t be able to give all their money away before they died and therefore escape taxation by that particular route. So the government felt it was necessary rather to close the gate there, and give coverage backing up to a period of five years prior to the death, which was felt to be an adequate time. I think the federal was three years.

Our recommendation, 360-355 was that Ontario introduce a gift tax applicable to individuals and personal corporations at the same rate structure as recommended for succession duties. Then certain exemptions to charitable and other foundations are set out. Then we recommended that gifts made by an individual in a year to any one person, not exceeding $1,000 in the aggregate, be exempt. What is it today -- $10,000 to any one individual? What is it in the aggregate to be? It’s to go from $10,000 to $25,000 to all individuals.

That’s quite a leap in a very short time. It’s a cutting into and an erosion of the taxation base in this regard which can only benefit a very narrow number of people in this populace, the well-to-do. It’s class legislation in a rank sense. We’ve said this before. It alleviates a tax burden duly earned, deservedly registered against a segment of society which is making in excess of $100,000 or $75,000 and up and who have accumulated capital assets in excess of $150,000 or so. Those are the people who will be the beneficiaries of this legislation and no others.

It continues the division in the society, the deep acrimonious divisions which are, and will in the next few years come home to roost. The society is breaking down around us. These matters about taxation enjoy very little attention in the House, although from a New Democratic point they’re absolutely crucial. The crunch, or one of the major crunches of the whole economy, is who taxes and who pays; what do you get and why do you get it in this particular area rather than another.

The Conservative Party has no quarrel with the federal government. My colleague laments the disappearance of the federal government from this field and its abdication and it is an abdication in this regard. This government thought at that particular time that it would make for increased revenues in the hands of the province. It was begging at that time for increased sources of taxation revenue and it thought succession duties and gift tax were just the bird of the right colour.

But what happened? Lougheed came into the world, a new-born babe glistening with oil, and he set up his little tax haven. We used to berate it. We’d stand here and point to the Bahamas, to E. P. Taylor’s little demesne down there. He wants to take all his wealth now and extract it out of this country. I don’t know what he intends to do with the poor Bahamians when he finally gets there.

Mr. Renwick: Or his predecessor, the chap that was murdered years ago.

Mr. Lawlor: Mr. Lougheed sets up his little empire, cuts out sales taxes and then moves in as soon as the federal government moves out to cancel all of succession duties. This government is placed in an invidious position because it feels that there might be individuals in this province, the wealthy who are always the most patriotic and the most loyal to that source from which they earn their revenues, who will depart the province, who will be off to the azure havens close to the mountains.

May the mountains fall on them. I think the government’s fear is partially self-generated and therefore to that extent is fictitious.

After all, the sources of their wealth are in this province. They are in the manufacturing of this province. They’re in acquired land holdings here. They can’t move those things. If they want to go and live out there that’s their business. But the fact of the matter is that if the government taxes at the situs of the property the benefits will stay with this province.

The government hasn’t even the courage, in matters of taxation, when the members of the opposition stand up and rail against the damn thing, as I’m doing now, to answer us forthrightly and with any degree of frankness. It takes a lugubrious, long-faced stance; its lips are sealed; it won’t mention the two reasons that motivate it behind all these things.

What is it all about and why does the government take these measures? The intention of the legislation is never even mooted. It’s not in the Treasurer’s (Mr. McKeough) statement on the budget. What is the raison d’être of the legislation? What is the government trying to do?

For five years I’ve listened to the various Treasurers of this province stand up here, place their hands over their breasts and say, “Oh no, we have no intention of moving out of the succession duty field; we’ll retain it.” But year after year at this time as a result of budget measures introduced in the spring, the further trespassing goes on, the erosion continues -- Scarborough Bluffs is almost completely in the sea, so to speak, and we can see only a little hillock left here and there.

I dare say the minister will stand up again and say, platitudinously, “Oh no, we had no intention of wiping out succession duties.” He knows what a stink it would raise in this House, as far as we are concerned in any event; I think the Liberals couldn’t care less. But there the Tories find their identities; there they find themselves ad idem with the federal government. They moved out because they didn’t want anything to do with it; they washed their hands of it.

This government took it up and in the process is taking the skin off at the bone. What is left? In the field of wealth taxation, very little. That’s why we are on our feet today.

I want something clearly understood too, as we apparently have to do ad nauseum in the House because of certain remarks that I hear over my shoulder from time to time. With respect to the retail sales tax, we voted against it and we gave our reasons for voting against it. We are voting against these two measures too. Not because -- and let no blandishments be made -- not because we would not alleviate the farmer in this way. If we can keep lands in agriculture, so be it. If this is an alleviation that will retain the agricultural life of the province into future generations, which is an absolutely crying need because the thing is being desolated at the present time, then so be it.

The small businessman has been given very little credence by this government, although of recent date they have begun to stir in their burrows a bit because there’s an election coming and because we have raised the matter of the government's sense of assistance to small businessmen so many times that some of the smaller ones now benefit. The government must expand the development corporations sufficiently that the small businessman can get a little money in order to get their businesses going.

I’ve never been successful, no matter how many times I’ve approached them. Their terms of reference are constrictive, and the interest rates at which they lend are a malaise. The final bog everybody falls into is that the regulations and governing restrictions are so endemic that they are hanging and breathing over the shoulder of every small businessman in his daily, hour-to-hour operations, and he can’t possibly conduct his business sensibly. That’s the way the damned thing operates under this government, and it’s an area where it can give some relief.

In section 1 we have these two principles, but in section 2 they come along with a third principle. Do they do it deliberately? Do they do it under a masquerade? Do they bring Trojan horses into the city? It’s the third principle that we find so central and so unpalatable -- although it doesn’t obviate the other two; we would retain them -- that we are forced to vote against the legislation. It eats into the public realm. It does a disaffection to the tax picture. It distorts it and is a basic betrayal of the government’s own announced position, year after year.

Who is going to defend an equitable tax structure? Lord, we haven’t very many among the fellows in the provincial government -- certainly not the Minister of Revenue because he wasn’t in the rolls of the mighty in those times. He wasn’t a dignitary; in those days he was just a fellow like the rest of us. But they were the ones who did more to scuttle the Carter commission when an intimation of possibility came down from above that we might get some kind of fair tax structure. It wasn’t the Liberals in Ottawa, although Lord knows they did their share. Did you read the Senate report on the Carter commission, Mr. Speaker? It is one of the most devastating, most aristocratic, most patronage-ridden pieces of verbiage I have ever been exposed to --

Mr. Renwick: You’d think it would be purblind.

Mr. Lawlor: It was purblind, to sum it all up. I remember the statements emanating from here too, damning it under every head and bringing in every conceivable argument, however lucid or however valid, to undermine it, and they succeeded. They won the day. I don’t pretend the Tories would dream of bringing in equitable and decent measures with respect to death taxation or wealth taxation generally. They are just against it; that’s their position ideologically and ours is the other way. I think our position is eminently fairer.

Where does their weight fall? It falls on a whole echelon of people who have nothing or very little in this life except the income they make from month to month and week to week. The Tories court the wealthy.

It’s like 10 years before the French Revolution. They all sat in their grandeur garnering up the goods but it was taken from them. If the Tories don’t do it sagely and don’t do it in the manner my colleague has suggested, by gradations and moving in that way instead of moving in the directly contrary direction, they are going to bring that upon their heads. I think it is in the works particularly with the increased unemployment we are suffering from. I look for great perils in this jurisdiction. Maybe it would be better if they weren’t in office; at least, they wouldn’t be taken down to the Don Jail.

All right. In the area of the tax there is another section having to do with recording facilities. It’s a minor matter. It could be handled very well in committee. When we talk about committee on these things, we mean the committee of the whole House for this one but I would like to forewarn or forearm the minister that when we get to the Corporations Tax Amendment Act we really mean it to be taken out of this House completely and to the committee downstairs where members of the public could make appearances.

I don’t think it’s necessary in this sort of legislation, at least not yet. If we could get the kind of hearing my colleague suggests it should be a matter taken to the public realm to receive some kind of enunciations from out there on present policies and to give us an opportunity to inform them out there precisely what is happening in the realm of wealth taxation in Ontario.

Mr. Speaker: Does any other member wish to take part in the debate? The hon. minister.

Hon. A. K. Meen (Minister of Revenue): Thank you, Mr. Speaker. I want to express my gratitude to the members of the official opposition at least who have indicated that they see the wisdom of this legislation and that they support it. I think it’s got some excellent sections in it.

There are the increase in the amount of gifts which can be made, particularly the cumulative gifts which can be made of farming property or farm businesses; and the provision for exemption of contributions by a donor to a spouse’s registered retirement savings plan which was previously not an exempt gift. In other words, it created some problems with these retirement savings plans. That was a section we had intended to bring in following the federal budget of 1974, and we had already announced that would be brought in.

I was interested to hear in that sense that even the NDP is prepared to support these provisions with respect to the farming community and small business. I suppose therefore it’s apparent there is some measure of unanimity on wanting to keep farms in farming. We want to keep small businesses from having to be sold on the death of a principal shareholder. If they can be kept in the family for a short period of time now, as proposed, for a 10-year period, it’s certainly to the good of the country. The reduction of that holding period from 25 years to 10 years is, I think, most significant.

I think it is fair to say that I, too, would favour a really good look at the succession duty provisions. Although we are talking about the gift tax sections they are, as indicated by the members opposite, a package, one might say, with the Succession Duty Act amendment which will follow this one. We are going to be looking at these provisions over the next few months, not so much with respect to the question of taxation on wealth but rather with a view to simplification of the method of application of the tax on the estates that by the present exemptions now increase from $150,000 to $250,000 will have application to them. It’s still a relatively complicated formula through which to work one’s way when determining the method of tax collection.

The Gift Tax Act is, of course, here to protect the revenues of the Succession Duty Act. Without the Gift Tax Act we would, of course, be in deep trouble under the Succession Duty Act. I wonder if the member for Riverdale has ever taken the trouble to read appendix D of the report of the advisory committee on succession duties, dated Thursday, Feb. 23, 1973.

Appendix D, if I’ve got my papers right, is a paper, if memory serves -- although it’s not shown as such here -- by Wolfe Goodman, QC, on the matter of the taxation of wealth. It’s a very interesting article. In the long run, he weighs the two sides of the argument but comes down on the side of concluding that at this time in our history -- and this is relatively current, 1973 -- this province and I suppose this country really isn’t ready for a wealth tax in the direct sense put to us by the socialist member for Riverdale.

We are applying a tax here in a form of a wealth tax but it isn’t altogether. We’re taxing it at a particular time when a step is taken by a donor under this Act or under the Succession Duty Act on the death of the owner.

I think, Mr. Speaker, there is a fundamental difference of ideology here. We’re not prepared to accept that at this time, so I would think that in the ongoing picture we won’t be losing sight of the philosophies which Mr. Goodman has expressed and which others will express, I would suppose, in the months and years ahead.

The bill before us at the moment implements the budget proposals, and although I have a small amendment to this Act which I will propose when it goes into committee of the whole, I have no particular amendments for the Succession Duty Amendment Act. If the hon. members opposite want it to go into committee of the whole as well that will be perfectly satisfactory with me, but I want to make it abundantly clear that I was not necessarily suggesting that the Succession Duty Amendment Act go into committee. If the hon. members wish it to go, then that will be fine and at the appropriate time we can discuss the clauses in it in greater detail at that time.

For the present time, inasmuch as we are dealing with the Gift Tax Amendment Act, Mr. Speaker, I think that would conclude my comments on this bill.

Motion agreed to; second reading of the bill.

Mr. Speaker: Shall this bill be ordered for third reading?

Hon. Mr. Meen: No, committee of the whole House.

Mr. Speaker: Committee of the whole House?

Agreed.

SUCCESSION DUTY AMENDMENT ACT

Hon. Mr. Meen moves second reading of Bill 31, An Act to amend the Succession Duty Act.

Mr. Speaker: The hon. member for Lakeshore.

Mr. Lawlor: We have expressed ourselves fairly categorically at this stage but, it being a new bill, I think it should again be made amply clear that the section having to do with the alleviation of the tax vis-à-vis the farm community is perfectly justifiable and okay with us, and we wouldn’t vote against it, and also as a stimulus to small business and the retention of small businesses in Canadian families and in their hands and keep them going in perpetuity.

Too often under the former succession duty regulations small businesses were, because of non-liquidity, forced to sell to strangers or wind up. We have had many studies over the years on this particular thing and to that extent giving an alleviation in this regard is fine. But when the minister lifts the basic exemption across the board to everybody under the sun from $150,000 to $250,000 -- a quarter of a million dollars -- we think that’s zeroing in on a very narrow number of the people of this province and is a giveaway programme to the well-to-do.

We are under an obligation as representatives of the general public -- nine-tenths of whom don’t own shares in corporations and have small enough bank accounts, God knows, and I don’t think it is our job nor the minister’s to promote that particular kind of lacuna or loopholing of the whole succession duty operation. The amount of money left coming in through succession duties constitutes a pittance in the treasury of the province. A disappearing pittance.

It is one of the oldest taxes touched upon in human history, if we look at Adam Smith, that benighted purblind old beggar, who supported and gave the Tories their foundations and roots and the way they think. Three hundred years ago there was Adam Smith.

I was looking at “The Wealth of Nations” the other day and it recommended succession duties as a form of taxation; he hated all other forms but this was the one form of taxation he found acceptable. It was the form that kings used in the widest sense against their subjects.

As I said previously, it has the sovereign merit of being the painless tax and on that count alone recommends itself heartily, I would think.

An hon. member: Is that a fact?

Mr. Lawlor: There wouldn’t be any acrimony or backlash against the government in power for supporting, increasing, expanding and making the tax viable, snaking it a worthwhile tax.

I noticed Ricardo did a bit of it, too. I was doing a little research on succession duties to see how far they went back. John Stuart Mill in his representative government makes a strong cases of it. Mill was the last -- the beginning? -- of the laissez-faire economists.

Of course, Mill was a man ahead of his time. As he got older he became a socialist and abandoned the whole thing. That was the beginning of enlightenment in Great Britain, prior to George Bernard Shaw and Harold Laski. They recommended the tax, too, let me assure members. The Tories are the only ones who derogate from it and watch the process of wiping out.

One can spend a long time on the history, giving the various rates in earlier times and watching its proportion of the tax revenue of the province. Once it represented a substantial tax; of the total revenues of the province it was a critical tax but in the past 10 years and more latterly in the last five, it has become a disappearing tax.

I suppose as the capital gains taxation came into being the wealthy ran for cover and are seeking a particular haven. They found the haven, as I said earlier, in Alberta and this jurisdiction is setting itself up as a similar haven not, I say, in my opinion, necessarily or even contingently against Alberta but because this is the predeliction, the Tories’ own thinking. This is what, in their guts, they really want to do. It gives them this sense. Thank heavens for parliament -- at least we get the opportunity to stand on our hind legs and tell them so, otherwise they might not know. Their degree of insouciance and unconsciousness of these regards quite passes belief if there weren’t some of us sometimes to stand up and remind the government that this is what’s happening, maybe there will be a stirring as a result of that. As I said, it is all we can hope for.

This guy Lougheed has more sins to repent than just his stand in oil revenues. At the initiation of the thing and before his wealth was so great, and before the world imbroglio which brought about his ascendancy, he moved in on this area of tax, and he has a great deal to be forgiven for so far as the rest of this country is concerned, and he has done more to breach Confederation, in terms of inamity and in terms of internal taxation and monetary policies, than anything that was ever done in Quebec. Duplessis was bad enough, but he didn’t mulct the rest of the country, he mulcted his own people. But Lougheed plays a most vicious game and this is one of the portents of his viciousness.

I would like these words, if humanly possible, to be carried on to him, because some of us here feel that in this particular regard he undermines the whole country, upsets the tax structures, derogates from our possible growth and from the sources from which required necessary governmental schemes can be launched, simply because dog-in-the-manger-like he finds it possible to dispense with this form of taxation in an effort to lure the wealthy from Ontario into his own province. Some of them are going, I understand. There’s a few. But as I say, the roots are here and they are pretty hard to break even if there is no sentiment about it left in us. In earlier times the fellow would have been taken to Canossa and maybe flagellated a little in the snow. It certainly would do him no harm.

I was bemused to read in the Financial Post of June 26, 1971:

“It’s Christmas on Jan. 1, 1972. Next New Year’s Day should be far more lucrative than Christmas for children of wealthy Canadians. Finance Minister Benson’s new tax package, which includes the abolition of the federal estate and gift taxes as of Dec. 31, 1971, appears to provide an ideal pipeline through which well-heeled fathers can unload much of their wealth almost tax free on their heirs. Instead of gift and estate tax, the proposed new system would tax unrealized or paper capital gains. This tax break for the wealthy assumes the provinces don’t move into the gift tax field.”

No fear.

Hon. Mr. Meen: Which, of course, we did.

Mr. Lawlor: When they did, they don’t.

Hon. Mr. Meen: We did.

Mr. Lawlor: They do the dance and the ostrich flounders. Come off it.

Here today the government is emasculating its own legislation. They brought it in at a high enough level. We objected to that. It wasn’t even in line with the previous federal level. It was a much raised level, much more open, much more so-called generous. Generous to whom? Now, again, we are getting more of the same.

The thing becomes a charade. They may as well wipe it out. It has no validity. The whole field of taxation no longer has any weight in the province. It isn’t a consequence. It isn’t a real weight in the minds of those who have the wherewithal and are concerned or might be concerned about their tax. Their concern dissipates by the hour. Well, they simply advised them all to go and get some term insurance within the five-year period in which the thing exists. In 1972 they couldn’t anticipate this day of April 24 1975.

The bill does four things. It raises the exemption to $250,000. It changes the way in which the tax is calculated, and this is the most interesting thing, so that the average rate of tax is reduced. In other words, previously if a person hit $151,000, he then came in at the full rate.

Now the first $250,000 doesn’t even count; it’s not in the picture. It’s not as though it’s incorporated into the new rate once one exceeds that horizon. They start their rates running in a different way which again, Mr. Speaker, is a second reduction of the tax within the same piece of legislation. It’s a double move. Unless you read it carefully, I don’t think you would use that particular point. Again, I feel it’s sort of masquerade, a dance that the minister plays hidden in the interstices of the legislation itself.

The minister takes the forgiveness period for succession duty on farms from 25 years to 10 years. I really don’t know why he does that. We think, as I said, that the rate was fine. But why the time limitations? Does that not free farms in a shorter time to go out of the family business, to escape succession duty and to become the boon of developers to take away from farming? It strikes me that that would do that. Then the bill does similar things -- and this is a completely new measure -- with respect to the small businessman. We have no great objection to that.

What happens after the double whammy of the devil-distilled, stem-winding hell of a move that the government is making in this particular thing? The present tax on a $250,000 estate, would be $12,500. Lord, that’s little enough. Out of $250,000, $12,500 goes into the public purse as a result of the contributions that we made to that estate? How did the estate grow -- in isolation? Did it live in some kind of abstract demesne, divorced from the labour, from the natural wealth, from everything that all of us participate in? Is that the way estates are? Anyway, the previous tax was $12,500. Now it’s nil.

On $300,000, the tax used to be $19,500. It’s now $5,500. At $500,000, it was previously $@52,500 and now it’s $31,250. At $800,000, it used to be $117,000, and it’s $85,250. This is the way the world wags. Please stop, I want to get off.

How much further can the government go without eliminating the tax and making it a laughing stock? As far as I’m concerned, it’s a laughing stock already. The sooner the government gets out of the field, as things stand, in the way of honesty, the better it will be for all of us.

There’s a $56-million loss computed this year. Succession duties could very easily fetch in the province, I suggest, $100 million to $150 million a year without driving anybody out, without anybody being mulcted, without any particular twist or turn of the screw and without doing any great harm to beneficiaries. They would still be the overwhelming beneficiaries of the largess. Why does the government do this? Aren’t the benefits to the province sufficient?

The government is hard taxed for money; it’s crying for it. It has to move in the next few years back into the area if it is going to find the requisite funds to carry out numerous projects. If it is going to do anything with child care projects, it’s going to have to find extra money. The pressure on the budget is very hard. This is the simplest, most simple-minded, least onerous way of acquiring it. Let the government take good cognizance of that and alter its position.

Mr. Speaker: Does any other member wish to take part in the debate? The hon. minister.

Hon. Mr. Meen: Mr. Speaker, I’m not quite sure where the hon. member got his figures from. They don’t seem to check out with mine. Actually, the main thrust of increasing the exemption, apart from relieving the anguish of some of those whose estates might be looking as if they were pressing up toward the $150,000 figure, is to get out of the taxation field quite a number of the estates that would otherwise be taxable. The figures, as my staff provide them to me, indicate there was actually a total of 43,700-odd processed last year. There were 2,675 that were taxable -- 2,675 out of 43,000. We will better than cut that in half by this modest increase in the exemptions. We estimate about 1,200 now will be subject to tax.

Mr. Lawlor: He says $100,000 is modest. Well, the minister is a man of great modesty, indeed.

Hon. Mr. Meen: The member will have noted, if he looked at the budget papers, that they indicate an anticipated reduction in revenues from $74 million in the last fiscal year to approximately $67 million. So that’s not a significant loss for a very significant reduction in the number of estates that would be taxable. We will still hit very heavily the sizable estates that will be coming in.

As I say, I don’t know where he got his figures. In an estate size of, say, $200,000, there was a tax before as the Act presently stands, but before amendment, in the preferred class of some $24,000, in the collateral class of some $25,000, and in the stranger class of some $25,000. The notch provision world apply there to wipe out what would otherwise be an outrageous increase.

At the $250,000 figure -- which is, of course, still clear of any tax under these amendments -- the preferred class would have paid $31,250, the collateral some $50,000, and, again, the stranger class some $50,000.

But when you get up to the $600,000 or $800,000 class, Mr. Speaker, and I did not follow his figures at all when he got up there, my figures would show that in an estate of $600,000 in the preferred category the tax would have been $138,000. It’s now reduced to $123,000. The collateral would have been $225,000, and that would be reduced to $175,000. And in the $800,000 -- I think he mentioned that one as well -- the preferred category would have paid $216,000, as opposed to $196,000 under the new rates.

Mr. Lawlor: I am going to speak to my research department, I can tell you, Mr. Speaker.

Hon. Mr. Meen: So you can see that the gap is narrowing there, Mr. Speaker, and in the higher category they are still paying a very substantial amount of tax. The figures he was quoting were quite different from that, and I was wondering where he got them from.

In any event, sir, this bill, in implementing the budget, does essentially increase the exemptions on the size of an estate that is taxable, and the size of any specific or general legacy that would attract any secondary tax to also $250,000. I think, as I indicated at the beginning, it goes a long way toward easing the minds and the apprehension of those who think that their estates might be subject to some form of tax.

We’re not about to try to confiscate the smaller estates of the people of this province. We still feel it’s appropriate to apply a succession duty to the large estates. We do not think that, by taxing in this fashion, we will drive any significant number of people out of Ontario and into sister provinces, or into other jurisdictions, in which they might manage to escape some measure of tax.

Certainly, some people who are very wealthy have managed to do this, but I don’t think this Act would have any effect one way or the other. You have to remember that the federal government, Mr. Speaker, with its capital gains legislation, capital gains tax on realty increases, capital gains tax on stocks, capital gains tax on any increase -- except, of course, one’s principal residence -- takes a very substantial piece out of capital gains and wealth increases generally. We also have some pretty heavy income taxes, both federally and provincially.

Mr. Speaker, I know what the socialists would do, to put it very crassly -- I really say this not altogether seriously -- they’d confiscate everything.

Mr. E. J. Bounsall (Windsor West): Careful.

Mr. Lawlor: That kind of remark is beneath the minister.

Mr. W. Ferrier (Cochrane South): Just go overboard.

Hon. Mr. Meen: They really wouldn’t, I suppose, but they certainly would go a lot further toward the confiscation of wealth than this party is prepared to do.

Mr. Lawlor: The minister is not on the hustings now.

Hon. Mr. Meen: We feel people with wealth should bear their fair share and we believe this kind of legislation is doing just that.

Mr. Ferrier: We believe in socialism for the rich and free enterprise for the poor.

Mr. Speaker: The motion is for second reading of Bill 31.

The House divided on the motion for second reading of Bill 31, which was approved on the following vote:

Ayes

Nays

Auld Bales Beckett Belanger Braithwaite Breithaupt Brunelle Clement Deacon Downer Dymond Eaton Edighoffer Ewen Gaunt Gilbertson Givens Grossman Haggerty Handleman Henderson Hodgson (Victoria-Haliburton) Hodgson (York North) Irvine Jessiman Kennedy Kerr Leluk MacBeth Maeck McIlveen McKeough McNeil McNie Meen Morningstar Morrow Newman (Windsor-Walkerville) Nixon (Dovercourt) Nixon (Brant) Nuttall Parrott Potter Riddell Rollins Root Roy Ruston Scrivener Singer Smith (Simcoe East) Smith (Hamilton Mountain) Smith (Nipissing) Snow Spence Taylor (Carleton East) Turner Villeneuve Wardle Welch White Winkler Wiseman Worton -- 64.

Bounsall Burr Cassidy Davison Deans Ferrier Foulds Germa Laughren Lawlor Lewis Samis -- 12.

Clerk of the House: Mr. Speaker, the “ayes” are 64, the “nays” are 12.

Motion agreed to; second reading of the bill.

Mr. Speaker: Shall this bill be ordered for third reading?

Committee of the whole House.

Agreed.

ROYAL ASSENT

Mr. Speaker: I beg to inform the House that in the name of Her Majesty the Queen the Honourable the Lieutenant Governor has been pleased to assent to certain bills in her chambers.

The Clerk Assistant: The following are the titles of the bills to which Her Honour has assented:

Bill 30, An Act to amend the Retail Sales Tax Act.

Bill 33, An Act to amend the Motor Vehicle Fuel Tax Act.

Bill 34, An Act to amend the Gasoline Tax Act, 1973.

CORPORATIONS TAX AMENDMENT ACT

Hon. Mr. Meen moves second reading of Bill 36, An Act to amend the Corporations Tax Ad, 1972.

Mr. Breithaupt: Mr. Speaker, my remarks with respect to this bill will not be lengthy as I understand that, by agreement, the minister is going to send this bill to standing committee. There will be the opportunity, therefore, for members of the committee to deal more particularly with many of the points in this very lengthy and technical bill.

There are changes to start with, of course, with respect to certain definitions. We find words like “bank” and “do” being redefined in order to bring these terms and others into a parallel approach with respect to the federal definition.

Generally, throughout this statute, Mr. Speaker, there is an attempt to parallel various amendments and various changes to federal legislation so that we have a tax statute which is consonant with the federal approach to taxation. There are some things, of course, which perhaps should not be fully parallel and I have a couple of questions that the minister may at least consider when that time comes forward.

On the accrual basis that is dealt with in section 4, subsection 2, there is -- as I understand it, by definition -- an attempt to change the timber resource matter. As I understand it, it is now going to be done on an accrual basis, rather than as the income has been received. This is paralleled with federal legislation.

I’m wondering why we are proceeding in this way, by tying in this kind of portion of the statute with the kinds of disallowances that have taken place on the levies for oil and for other gas and mineral resources. As a deduction, I understand, this is simply not allowed. One wonders why, instead of denying a deduction, the government doesn’t change the situation so that this is not simply being brought back into income in this way, but rather that the deduction is not allowed in the first place.

There is a parallelism here with federal legislation. I understand, of course, that the federal disallowance is matched by an abatement of some 15 per cent, but the provincial disallowance is really not matched in that same way.

It would seem that if royalties are a rental, then presumably they should be an operating cost and, of course, are not allowed in this circumstance as a deduction. The minister may have some further comments before the committee as this goes forward at that time, and perhaps he can explain to us at that point the approach which is being taken.

Again, in sections 4 and 5, there are parallelisms to the federal legislation dealing with accrual of interest and attempting to plug a loophole which was, of course, plugged in the federal budget in November. And also in section 5, dealing with the parallelism that made me sort of wonder; because it seemed to me, as I recalled the situation, that in section 5, Canada Savings Bonds could only be purchased by individuals.

As a result, I wondered why it was necessary to have presumably parallel legislation in our Corporations Act if, indeed, corporations could not buy Canada Savings Bonds in the first place.

Now, of course, for individuals the matter of interest would be beneficial, so that if interest received was more than $1,000, then the additional amount could be taxed only at a 50 per cent rate.

However, I am wondering if really this section is not perhaps in the wrong Act. If we have a necessity to have this kind of situation with respect to an allowance under the Canada Savings Bond programme, then perhaps that should be in the Income Tax Act.

My question, of course, is: Why is it in the Corporations Tax Act, if I am correct -- which, of course, I may not be -- that Canada Savings Bonds can’t be acquired by corporations in the first place?

There are various other housekeeping sections in the bill and these particularly start with section 6. There is greater certainty that it does apply in these various housekeeping sections. Again, we refer in section 7 to the matter of the royalties no longer being equivalent to operating expenses, so that this difference of 12 per cent will amount, to an $18 million amount more for the Province of Ontario this year.

There seems to be a lack of agreement between the federal and provincial authorities, since the mining tax is expected to bring in $130 million this year, and this additional amount not being allowed as an expense would bring a concomitant 12 per cent benefit. Again, there is much more parallelism.

I would refer, even though it seems a minor point, to section 8, subsection 9, which appeared, at least in our review of it, to have an incorrect reference that I might just suggest to the minister at this point. In this case the bill reads, “ ... notwithstanding section 22(1b) ...” I suggest that perhaps should refer to clause a because, as I recall, clause b deals with a disallowance of capital outlays, whereas clause a is the one that I think reference might be intended. In this case I suppose the legislation becomes in effect no worse than the federal legislation and even though it may be a little difficult to interpret, perhaps we are resolving what is otherwise a problem.

It was suggested to me that the development of this particular clause came from the federal income tax interpretation bulletin No. 131 and that perhaps the clause unfortunately is based more on the comments within the bulletin than on the federal statute. As a result, this whole matter of convention expenses perhaps should be reviewed since the corporations do not deduct these expenses in the same manner that individuals do, and perhaps the kind of parallelism that the minister is seeking is not as clearly set out as he might wish.

I was interested in the point raised in section 12 with respect to the $2-billion figure concerning the reduction of the investment reserve on outstanding loans. I was not aware that any company in Canada had achieved this particular level, and I hope it is not simply a sign of inflation that, as a result, we get the astounding figure that appears in this section. Perhaps the minister can advise us if there is any corporation operating within the province that in any way might come up to this particular point.

Certainly the matters dealt with in sections 13 and 14 are quite satisfactory. The whole approach of having a greater flexibility in the deduction of scientific costs parallels the federal legislation and is something we can certainly accept. Section 14, dealing with the timber resource property is only a matter of clarification, and since this is now treated as income there is really no particular problem.

The one area I would like to discuss briefly with the minister relates specifically to section 25. It is really very difficult to speak in any particular way on the principle of a bill like this because there are a great variety of items that no doubt we will go over more carefully in committee.

My understanding of section 25 was that the exploration deduction was of course entirely deductible but the development deduction was only a 30 per cent deductible area on a continuing declining balance. If on sale the proceeds are credited back, we are then in a different situation than we are in Ontario. If both the exploration and the development deductions are entirely deductible, then those deductions in excess of what would be allowed under the federal scheme would come back into taxable income.

The matter of share for share exchange, which section 39 refers to, again parallels the federal legislation as we understand it. I suppose this kind of a section is much more important within our society now that we are having the Power and Argus Corp. projects going on, which I suppose have brought the kind of investigation of this entire involvement within Canadian society that the recent royal commission announced by the federal government is going to bring forward.

There is, of course, no gain to a shareholder when this kind of situation takes place until the final disposition of the shares. So this kind of a share-for-share exchange, we think, should not attract the probability of a tax situation until the share is obviously finally dealt with.

One point that I did want to raise in this section deals with the matter of the payment of sales tax. My understanding is that on these kinds of reorganization, where there are rollover provisions such as this, sales tax is payable. But the question arises, is there sales tax payable on this kind of winding up of a company when we have this exchange of share for share? There is no income tax payable, and one wonders why this kind of procedure should attract a sales tax involvement which may, in fact, be far more difficult to resolve and to work out than is worth it.

The matters of dividend stripping have been blocked of course in the next few sections of the bill, which is again similar to the federal legislation, as are those sections dealing with partnership.

I would like to refer particularly though to one matter and will pretty well complete my remarks at that point when we look at the matters raised in section 54. As you are aware, Mr. Speaker, the standing committee now having its responsibility to deal with Bill 3 with respect to the Election Finances Reform Act is referring to some of the areas which this section will now amend. There is apparently a contrast that the government has decided to keep between the involvement with individuals and the involvement with companies. I would suggest that these things will be more particularly dealt with by the standing committee on justice because they will have just dealt with the Election Finances Reform Act at the same time.

But there are contracts, because the $4,000 maximum payment here is likely to come off the payments off any company before the income tax base is set. So that $4,000, as a result of the 12 per cent Ontario rate, yields $480, but an individual giving some $1,150 would get the $500 tax credit. Really I suppose it’s no better a tax rate for the individual than for the company. For a corporation to give that $1,150, there would be a saving of some $138 which, therefore, presumably allows a corporation to consider the making of this kind of a gift as something which should be encouraged.

I am sure that the committee will look into the kinds of problems that could arise where a bonus is given to a series of employees who, in turn, then use that money to make individual benefits, as a result, hopefully, giving the corporation a more beneficial position than would these donations made directly to political parties.

With a $4,000 limit, presumably a gift of $10,000 would mean that only $4,000 would be allowable and, therefore, the corporations tax of the company would only be reduced by perhaps that $480 figure. However, if $10,000 was paid out in salary and wages, say, to five persons, then not only would the company benefit by having the full deduction of that payment as a business expense, but there would be really some federal tax relief also. The individuals who might be receiving benefits would allow themselves, obviously, the opportunity to pay a higher amount of income tax but the total benefits which individuals could then claim for will, as a result, be somewhat different from those which the company would allow.

I am sure this will be dealt with, particular in committee, so that we are all dealing with these three areas of legislation, in the stations here, in the Income Tax Act and in the Election Finance Reform Act so that we have one consistent approach to the kinds of political contributions which the government -- and indeed, we on this side of the House as well -- believe should not only be encouraged but also should be made entirely and completely respectable.

I am rather interested in the points raised in section 64 which has a change in the payment times for instalments of tax payable. These sections, again, are somewhat parallel to the federal legislation and I presume they are a revenue raiser in that the deficit for the end of the year appears a little smaller if we get a bit of next year’s money in this year.

Perhaps the minister, when we get to committee, could discuss with the standing committee the matter of the kinds of terms on which these final instalments should be paid. One would think, for example that a small business corporation might be more easily able to get its books in order in two months and a larger corporation might require three, rather than the reverse which we have here. However, I suppose the amounts of money involved --

Hon. Mr. Meen: A larger corporation would probably have an internal auditor.

Mr. Breithaupt: This is a point, of course, and they also have a larger amount of money that the minister wants to get from them. I suppose that additional month is something they simply have to be prepared to cope with and to resolve their problems more quickly.

There are a few other points, Mr. Speaker, but only one I would like to refer to. That is a reference to the speech the Treasurer had made with particular concern on these points.

On page 8 of the bound copy of the budget speech, he sets out, comments with respect to tax simplication. The Treasurer has said the government is going to attempt to make certain streamlining procedures. The thing that interests me particularly in this area is the second line in that paragraph:

“Our objectives will be to reduce the costs of compliance, to simplify forms and procedures to follow wherever possible the federal administration, and to speed up rulings and decisions.”

This is an area of some particular interest because, as you know, Mr. Speaker, there is a rulings department in the federal Ministry of National Revenue which allows certain answers to be given and rulings made on points raised. From the comment at least in the speech one is able to presume that any ruling given by Ottawa on a particular technical matter is going to be followed without question by Ontario. I don’t think the minister would want to give that presumption which might flow from this particular point in the Treasurer’s budget speech.

If we are to have a rulings department of our own -- which may, of course, be coming -- we may not have things speeded up any more than they are now. If there is a difference in a ruling, we’ll say, with respect to a corporate reorganization problem, there are going to have to be some mechanics set up in order to resolve these problems where the federal and provincial authorities may not see exactly eye to eye.

The statutes, of course, can be very close and indeed the amendments the minister is making in this Act are parallel to the federal legislation in many ways. However, the ultimate rulings which may flow may not be the same and the minister may find himself in some difficulty unless, I think, he clarifies the commitment that he has to be master in his own house and not automatically follow federal rulings just because the rulings are made.

There are, of course, interpretation bulletins which the federal government publishes, as the minister is well aware, and if these are presumed to be paramount this should be clarified. I hardly think that would be the case because surely we will want to be in a position to have some balance in reviewing situations which may not be exactly the same as the federal administrators may see their Act in place.

I have no further comments generally with respect to the Act, Mr. Speaker. I think the minister in his reply may choose more particularly to reply as the various sections are dealt with. If he wishes to do that and raise certain comments when it goes to standing committee, certainly I would be pleased to have him deal with it in that manner. We will support the bill.

Mr. Speaker: The member for Lakeshore.

Mr. Lawlor: Mr. Speaker, once or twice in a session we get a particular, peculiar brute of a bill. This is the prize cake for this particular time in our lives. We have indicated to the minister that since there are 67 sections in the legislation, and there are 103 different principles, it is better not to try and segment them out in second reading; second reading just doesn’t seem to us the appropriate time. We have an understanding with the ministry, I take it, that the matter will be sent to the justice committee where representations from the public, and I trust from the legal profession and other sources may be received by the committee.

Quite frankly, in a spirit of humility, there are a good many sections in there I don’t understand and on which I would be pleased to be clued in as to precisely what they do mean. We have been concerned about this.

The bill covers everything from wholly-owned subsidiaries and special ways of creating them, to patronage dividends, co-ops, credit unions -- the whole gambit and ambit of thorny special interest rates, touching parking lots. If you go on, Mr. Speaker, this is the soup-and-nuts bill, and as I say we welcome the co-operation of the minister in this particular regard. He is trying to parallel, to the greatest extent possible, federal legislation; but the federal legislation is itself in a state of turbulence and change, and so to try and bring things into line is quite a problem under legislation of this kind.

I’ll say this, I'll confess to it quite openly, I don’t look forward to meeting the minister next week in committee on this. However, it is part of the job, I guess.

Mr. Speaker: Do any other hon. members wish to speak to this bill? The hon. minister.

Hon. Mr. Meen: Mr. Speaker, I’ll undertake with the hon. member for Lakeshore that if he doesn't get pejorative when we get before the committee, I won’t.

Mr. J. F. Foulds (Port Arthur): On a point of order, Mr. Speaker, the member for Lakeshore never gets pejorative.

Hon. Mr. Meen: That’s a matter of opinion, Mr. Speaker. In any event, I quite look forward to it even if he doesn’t.

Both members who have spoken have indicated sentiments with which I find myself essentially in concurrence. The bill is immensely complicated. It has a host of principles. We are indeed attempting to parallel, wherever possible, the federal legislation, provided it coincides with our own thinking.

I might say that as to rulings from Ottawa and interpretations, I'd like to leave myself the latitude to determine whether, indeed, the interpretations placed on the sections of our Act are the same as those which, even if they are identical in nature in the federal legislation, are the same as the interpretations placed in Ottawa. But the intention, in paralleling the federal legislation, is in large measure to make it easier for the practitioners, for the people who have to guide industry in Ontario, to live within this extremely complicated, in fact, taxing legislation.

Yes, we touch on things like campaign contribution deductibility; and the hon. member for Kitchener is correct, as I assess it, in the amount that would be deductible from corporate tax. We will probably, in committee, get into discussions of the way in which this might be supervised so there can’t be an abuse of these limitations; although it may well be that’s more pertinent to the Election Finances Reform Act itself, I’m not quite sure.

In any event, I’ll certainly welcome their views. And I actually would extend the invitation now -- and will ask the staff to do so formally tomorrow -- to have the representatives of the legal and accounting professions attend the committee. We will alert them to the fact that the bill is going to go to the standing committee on administration of justice so they may be able to attend and offer us the benefit of their wisdom, experience and advice as we deal with the various sections clause by clause. I think, Mr. Speaker, there is only one point on which I would touch, and it was a technical one raised by the member for Kitchener; namely, would there be retail sales tax charged on rollover of shares? And as I understand it, of course, it’s under another Act, the Retail Sales Tax Act, but in this kind of arrangement there would be no tax payable.

Mr. Speaker, I propose to do just as both hon. members have invited me to do; namely, reserve my comments on the principles of the bill as we get into the 67-odd sections of it when it’s before the standing committee.

Mr. Speaker: The motion is for second reading of Bill 36. Shall the motion carry?

Motion agreed to; second reading of the bill.

Mr. Speaker: I understand this is to go to the standing committee on the administration of justice.

Hon. Mr. Meen: Thank you, Mr. Speaker.

Clerk of the House: Order for committee of the Whole House.

GIFT TAX AMENDMENT ACT

House in committee on Bill 32, An Act to amend the Gift Tax Act, 1972.

On section 1:

Hon. A. K. Meen (Minister of Revenue): Mr. Chairman, I don’t know whether you have a copy of it, but I propose an amendment to section 1, subsection 1, so I suppose I might as well introduce it at this time. Yes, I see Mr. Chairman has a copy of the amendment and I have given copies to the members opposite.

Hon. Mr. Meen moves that clause (i) of the amendment to section 10 of the Act proposed by subsection 1 of section 1 of the bill be amended by inserting after “trust” in the third line of the said clause “of shares of a small active business corporation.”

Mr. Chairman: Do any members have any comments on the amendment? Shall it carry?

Hon. Mr. Meen: I might explain, Mr. Chairman, that it corrects a typographical error in which those words were unintentionally left out when the bill was being printed. It’s rather an important wording.

Mr. Chairman: Shall clause 1 carry as amended?

Section 1, as amended, agreed to.

On section 2:

Mr. Chairman: Clause 2.

Mr. P. D. Lawlor (Lakeshore): Mr. Chairman, just a word on clause 2. I’m not going to move an amendment to delete the clause. I shall wait upon a similar clause in the next subsequent legislation to do so.

Hon. Mr. Meen: Excuse me, just for clarification, are we on section 2? The chairman referred to clause 2. Does he mean section 2?

Mr. Chairman: Section 2.

Hon. Mr. Meen: Thank you.

Mr. Lawlor: That is the section, yes; the section increasing the aggregate of all gifts to $25,000. We have indicated our reasons for finding them unpalatable. We’ve sought to prevail upon the government to alter its position in this regard. We want to express our distaste for the section as it presently stands, but I have no intention of forcing it to a vote on this particular bill.

Mr. Chairman: Does section 2 carry?

Section 2 agreed to.

Mr. Chairman: Does section 3 carry? Does any member have any comments to make before section 8?

On section 3:

Mr. Lawlor: I have one question on 3.

Hon. Mr. Meen: Section 3?

Mr. Lawlor: Yes. You are requiring these returns for the first time. What is the reason for that? Won’t it just make for a lot more paperwork -- an unnecessary rigmarole?

Hon. Mr. Meen: I don’t think so, Mr. Chairman. The point here is that if the returns are aggregating to a total of $75,000, we want them as these gifts are made.

You see, this is the time where you may now make gifts aggregating up to a total of $75,000. I think it’s essential that we should have some mechanism so that as the gifts are made a copy of the declaration is filed and not 10 or 15 years later or whenever, when you have reached the total as presently contemplated in the Act.

Mr. Lawlor: Just a question: If they don’t file then is there a period of disallowance?

Hon. Mr. Meen: My staff advises me there isn’t. I’m wondering if there should be. We may have to take that under advisement.

Mr. Lawlor: Yes, because if they sit on it then the very effect that your answer indicated to me you were trying to solve, could very easily occur. Somebody just comes up with a sheaf of papers many years after the event, post-dated or pre-dated or dated somehow. Yes, I think you better look at that, Mr. Minister.

Hon. Mr. Meen: It is an interesting point, Mr. Chairman. I don’t think we should hold up the passage of the bill, but I certainly think we should take a good look at the enforcement section. There is a penalty, I’m advised, for failure to file, so that would be some kind of incentive.

Mr. Lawlor: But not within the limited time.

Hon. Mr. Meen: Right.

Bill 32, as amended, reported.

SUCCESSION DUTY AMENDMENT ACT

House in committee on Bill 31, An Act to amend the Succession Duty Act.

Mr. Chairman: The member for Port Arthur.

Mr. J. F. Foulds (Port Arthur): May I call to your attention, with great regret, the lack of a quorum.

Mr. Chairman ordered that the bells be rung for four minutes.

Clerk of the House: Mr. Chairman, we now have a quorum.

On section 1:

Mr. Chairman: The hon. member for Lakeshore.

Mr. Lawlor moves that section 1 of Bill 31 be deleted, and the subsequent sections be renumbered accordingly.

Mr. Lawlor: Mr. Chairman, a few words. We’ve just debated the main principle of the bill. I took time out, in a hasty survey, to pick up what my files of the past few years contained in the way of government bills amending the Succession Duty Act -- invariably, of course, reducing the amount of the tax, carving out all kinds of exemptions, altering the thing, withering it away, whittling its base, leaving nothing.

Also, I thought you might be interested in reading “Transfer Taxes -- Their Effect on Productivity; Studies of the Royal Commission on Taxation.” There is one that will touch the pulp of your heart. This doesn’t do what you are doing. This is the recommendation, of course, of the Carter commission with respect to the whole succession duty field.

There is any number of other documentations. We have been loaded in the past few years with reports, various surmises, royal commissions, volume after volume, and none of them -- not even your own -- recommends what you are doing here today. Ergo, section 1, out of your own lips, out of what you yourself have commissioned, becomes questionable and invalid. Just take it out and we’ll go on from there, and leave the farmers and leave the others alone.

Hon. Mr. Meen: Mr. Chairman, obviously I have to oppose that. This is one of the fundamental principles in the bill, bringing into effect the proposals in the budget that we increase the exemptions to $250,000. It’s a complicated section. I’m sure the member understands it but he disagrees with us basically in principle. I guess that is where the Conservatives on the one hand and the socialists on the other have a parting of the ways.

Mr. Lawlor: You are perfectly right that we have a parting. That’s where the Red Sea divides and we, the Israelis, go across; you, the Egyptians, drown.

Hon. Mr. Meen: We simply do feel that the area up to an estate of $250,000 should be completely exempt from the attraction of any succession duty and that’s the reason for section 1.

Mr. Lawlor: Do you like the biblical parable of mine? You, of course, will have manna.

The committee divided on Mr. Lawlor’s amendment, which was negatived on the following vote:

Clerk of the House: Mr. Chairman, the “ayes” are 11, the “nays” are 50.

Mr. Chairman: I declare the amendment lost.

Bill 31 reported.

Hon. Mr. Winkler moves the committee rise and report.

Motion agreed to.

The House resumed, Mr. Speaker in the chair.

Mr. Chairman: Mr. Speaker, the committee begs to report one bill with amendment and one bill without amendment and asks for leave to sit again.

Report agreed to.

It being 6 o’clock, p.m., the House took recess.