Legislative Assembly of Ontario

The House met at 2 o’clock, p.m.

Prayers.

Hon. W. Newman (Minister of the Environment): Mr. Speaker, I would like to take this opportunity to introduce to the Legislature 64 students -- and, I might say, very brilliant students too -- from Denis O’Connor High School of Whitby, along with their teacher, Mr. Joseph Modeste. I would like the members to welcome them here in the Legislature today.

Mr. J. R. Breithaupt (Kitchener): Mr. Speaker, on behalf of the member for Rainy River (Mr. Reid), I would like to ask you to welcome to the Legislature some grade 8 students from the Ignace Public School who are in your east gallery this afternoon.

Mr. G. E. Smith (Simcoe East): Mr. Speaker, in the absence of the hon. member for Simcoe Centre (Mr. Evans), I would like to introduce to you, and through you to the members of the Legislature, 23 grade 12 students from the Barrie District North Collegiate Institute, who are accompanied by their teacher, Mr. Kirk.

Mr. D. W. Ewen (Wentworth North): It’s a pleasure for me today to introduce to the Legislature and my colleagues a group of young ladies from the town of Ancaster’s Mount Mary Academy. They are up in the west gallery and I would like all the members to show their appreciation.

ESTIMATES

Hon. E. A. Winkler (Chairman, Management Board of Cabinet): Mr. Speaker, I have a message from the Honourable the Lieutenant Governor signed by her own hand.

Mr. Speaker: By her own hand, Pauline M. McGibbon, the Honourable the Lieutenant Governor, transmits estimates of certain sums required for the services of the province for the year ending March 31, 1976, and recommends them to the legislative assembly, Toronto, April 28, 1975.

Statements by the ministry. The hon. Minister of Energy.

HYDRO RATES

Hon. D. R. Timbrell (Minister of Energy): Mr. Speaker, I have received a submission from Ontario Hydro concerning proposed changes to its bulk power rates to take effect from Jan. 1, 1976. The proposal provides for approximate increases in revenue of $208 million from the municipal utilities and $54 million from the direct industrial customers, or about $262 million in total. This will result in a rate increase averaging approximately 29.7 per cent to municipalities and approximately 29.9 per cent to direct industrial customers. In reviewing this proposal, the government has three major concerns:

1. That the impact on consumers and industries be minimized by ensuring that any rise in the price of electricity be justified by clearly demonstrated increases in Hydro’s capital and operating expenses, and further, that Hydro is doing everything possible to minimize its controllable costs;

2. That Hydro’s financial integrity and credit rating be protected by ensuring a proper balance between rate increases and new debt;

3. That the interests of the Ontario public continue to be served by adequate supplies of electrical energy now and for the future.

Let me deal with these concerns in more detail. First, the impact of hydro rate increases will be carefully weighed through the public review process of the Ontario Energy Board. The higher rates proposed must be substantiated by Hydro on the basis of demonstrated and necessary increases in costs in the full glare of public scrutiny.

According to Hydro, the largest single contributor to higher costs is the continuing increase in the price of fossil fuels -- which account for between 25 and 26 per cent of Ontario Hydro’s total revenue needs in 1976. Other important factors include the high cost of borrowed money, and the expenses incurred by Hydro associated with the necessary processes of public involvement in the planning of the Hydro system.

Mr. S. Lewis (Scarborough West): Oh, come on.

Hon. Mr. Timbrell: Costs such as these lie beyond Hydro’s control. However, there are controllable costs and Hydro is aware of my concern that major efforts be made to reduce these through increased operating efficiency. Together with the government, public enterprises such as Hydro must lead the way for Ontario in the fight against inflation. This means adopting hard lines and making tough decisions.

Second, we must be concerned about Hydro’s financial integrity. As a public enterprise, Hydro from the beginning has operated on the principle of power at cost and has taken pride in charging for electricity only what it costs to produce with no profit. It has always fully paid its own way.

As a result, Ontario has enjoyed and continues to enjoy electricity rates among the lowest in the world, and Hydro’s financial soundness is well recognized. There are only two sources of funds -- hydro rates and capital borrowing; my concern, and that of this government is to ensure that Hydro continue to raise the money it truly needs in the proper proportion from each source so that its credit rating remain intact.

Our third concern is with adequate supply. The average annual growth rate of the demand for electricity in Ontario has been about seven per cent from 1908 to 1970 -- in effect a doubling every 10 years over a period which included two world wars and a great depression.

Since 1970 this growth rate has actually increased, to about 7.4 per cent per annum. As evidenced by our energy management programme, we agree that growth in total energy demand must be curbed. Nevertheless, this does not necessarily mean that growth in electricity demand will lessen.

As fossil fuels become scarcer and more expensive, a larger percentage of the total energy market may well be served by electricity. Ontario Hydro has considered the conflicting factors of economic recession, energy conservation, and the changing patterns of energy consumption, and is convinced that growth in electric power demand will remain close to the long-term average of seven per cent. The load forecasting techniques on which this judgment is based will be a critical point in the Ontario Energy Board review.

As required by section 37(a) of the Ontario Energy Board Act, I am referring this proposal to the Ontario Energy Board for its hearing and report. The board will hold public hearings, which are expected to commence on June 9. This will provide an opportunity for Ontario Hydro to publicly defend its proposal, and for interested members of the public to study and question it. The board will consider all evidence submitted and opinions expressed before submitting its report by the end of August, 1975.

There was general satisfaction with the first Ontario Energy Board review last year, even though many important issues remained unresolved. Ontario Hydro will again co-operate with the Energy Board to ensure a thorough and fair hearing of these complicated and conflicting issues, and that further progress will be made toward satisfactory solutions.

All interested members of the public will have the right to observe and participate in the rate-making process. It is important that there emerge a clearer understanding of the issues involved in establishing the price of electricity in this province.

Last year, as part of the first public rate review, the board was directed by my predecessor to make a broad survey of Hydro’s financial policies and capital expansion programme. One of the most important and beneficial results of this investigation was to identify particular issues which required study in greater depth. After consultation with the government and the interveners in last year’s hearings, the board has indicated that, this year, it will place particular emphasis on the following questions:

1. Equity financing -- the appropriate balance between new borrowing and increased rates in financing Hydro’s capital expansion, and the selection of appropriate financial indicators;

2. The relative size of the demand and energy components of bulk power rates;

3. The size of discounts for interruptible and furnace loads;

4. Export sale and pricing policies;

5. A general financial reserve;

6. Interest capitalization policy;

7. The use of 13th bills;

8. The recovery of operating deficits from particular classes, and

9. Hydro’s access to financial markets.

Public notice was given of the board’s intent to consider the first four of these in its press release of March 6 of this year, so as to allow potential interveners time for adequate preparation.

The board has authority to consider such additional matters as it thinks fit, or request further study of any issue, but it is intended to concentrate on these nine issues in order to permit a more detailed examination of each.

The board last year recommended a number of studies to be conducted by Hydro. Because of their scope and complexity, not all of them are yet complete nor would the board have sufficient time to consider all of them in appropriate depth at a single hearing. Accordingly, final reports on a number of important topics will not be forthcoming until next year. These include:

1. Inter-utility productivity comparisons;

2. Depreciation and asset lives;

3. Overall cost allocation, including non-common and overhead costs;

4. Demand elasticity with price variation, and

5. The value to customers of different levels of service and reliability.

However, the board will review with Hydro the progress of each of these studies and may request such information as it considers relevant to the preparation of its report for 1975. The board must be concerned in particular with measures being taken by Hydro to promote efficiency and productivity. The government expects Hydro to adopt measures similar to its own to control staff levels and other operating costs. The board will also explore with Hydro measures to conserve electricity through the government’s energy management programme.

Two weeks ago, at the first ministers’ conference, this government took a firm stance against increases in the price of oil and natural gas in order to protect the economic well-being of the people of Ontario. Since the prospect of higher prices for any form of energy cannot be welcomed, a publicly-owned utility such as Hydro has a heavy responsibility to justify its rate increases.

The necessity of an electricity price increase will be subjected to a rigorous analysis by the Ontario Energy Board and will be as thorough and extensive as required again to protect the economic well-being of the people of Ontario. To ensure that Hydro’s proposed rate increases are thoroughly scrutinized, I invite all interested and concerned citizens to participate in the Ontario Energy Board hearing.

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

GOVERNMENT POLICY ON ONTARIO HYDRO

Mr. R. F. Nixon (Leader of the Opposition): Thank you, Mr. Speaker. I would like to put a question to the Minister of Energy following his statement. Does he recall that Robert Macaulay, having been retained by the Ministry of Energy to put forward certain alternatives in the hearings last year, very definitely indicated that in his view -- which was evidently well prepared; a very expensive and full preparation -- rate of growth of Hydro should not be accepted at 7.3 per cent and there was much reason to believe that it could be reduced? Since the minister himself is in charge of a programme designed to conserve energy, is he now saying that this rate of growth which he said has been seven per cent but is edging up to 7.3 per cent, is acceptable to the government, because surely that is one of the parameters upon which the hearings must be based? If that rate of growth could be reduced, surely the cash flow could be reduced as well.

Hon. Mr. Timbrell: Mr. Speaker, as I indicated in my statement, until five years ago the rate of growth over a considerable period of time -- more than 60 years -- had been seven per cent on average with a variety of peaks and valleys depending on recessions, depressions, wars and so forth. Since that time it has climbed to 7.4 per cent. In recent months, due to climatic conditions mainly, it has dropped below that figure. This will be, and is, under constant review both by the ministry and in the annual reviews of the Ontario Energy Board.

Obviously if the pattern of the last two or three months continues -- if it is not just due to climate; if, in fact, we are making progress getting through to people about energy conservation and a variety of other factors -- that will have to be reduced. I don’t think it would be wise to do so at this time on a couple of months’ experience.

Mr. R. F. Nixon: A supplementary: Would the minister not think that a strong programme of energy conservation might have at least part of the effect we would want, particularly if the government is not prepared to accept that rate of growth but something substantially lower, in view of the situation which the minister described as climatic?

Hon. Mr. Timbrell: Mr. Speaker, as the hon. Leader of the Opposition knows, we are in the second phase of the energy management programme, that being the demonstration phase, and we will keep building on throughout the blocks. There is no doubt in my mind that greater acceptance by the individual citizen and the commercial and industrial segments of the Ontario economy of the need to conserve and the benefits of conservation, financial and otherwise, will in the long run assist us in bringing this down.

I would have to say this, Mr. Speaker. You simply can’t look at hydro, the electricity, in isolation. I’ve mentioned before in this House that when you consider the situation with supplies of gas and oil and the prognosis that exists with those two particular commodities, you have to bear in mind the possible conversions, perhaps large-scale, to electricity from those two present fuels. So, there are a number of variables in there that in my mind argue against dropping back from the seven per cent assumption at this time.

Mr. Speaker: Supplementary; the member for Scarborough West.

Mr. Lewis: Surely what is needed at this point is a basic and fundamental government policy decision about the role of Hydro and the growth rate which the minister will recommend and accept for Ontario, and some policy decisions about a debt financing, rather than the perpetual parade before the Ontario Energy Board to review rate increases which invariably go up, regardless of the board’s recommendations, higher than any consumer would wish. Doesn’t the minister think we have come to a point where the cabinet has to declare itself now about Ontario Hydro’s growth rate, and not simply refer it to the board again?

Hon. Mr. Timbrell: Mr. Speaker, I think I just said, given the history of the growth in Ontario, given the recent experiences right up until the end of 1974, given the uncertainties about supplies of oil and gas for the future, that the prudent route to go, the responsible route to go, is at the present time to accept and stay with the seven per cent projected growth.

Mr. Lewis: That’s prudent?

Hon. Mr. Timbrell: That is prudent.

Mr. Lewis: That’s inflationary. It is absurd.

Hon. Mr. Timbrell: Not at all. Well, I’m not going to get into these things.

Mr. Lewis: Okay.

Hon. Mr. Timbrell: If the member is asking is this government committed to growth, I would have to say that this government does not stand for growth for the sake of growth. There’s bound to be growth, in new industry, new towns, new institutions -- whatever. We’ve got people coming here from other countries and other parts of the country and growth is continuous, but growth for the sake of growth, no. Given all the factors I mentioned at the beginning of my answer, I think it is prudent and wise at the present time to hold with the seven per cent projection.

Mr. Speaker: Any further questions? Does the member for Welland South have a supplementary?

Mr. R. Haggerty (Welland South): Yes, I would like to direct a question to the Minister of Energy.

Mr. Speaker: A supplementary question?

Mr. Haggerty: A supplementary question; that’s right. In his statement he said the public will have a right to scrutinize the rate increases. How can he justify that statement when information isn’t available to the public to make a reasonable approach to the Ontario Energy Board? For example, for the last five weeks I have had a question on the order paper dealing with Ontario Hydro and the export of energy to the United States. How long does it take to get information?

Hon. Mr. Timbrell: Mr. Speaker, I don’t know where that is but I signed the answer to that question at least two or three weeks ago, so it is caught up somewhere in the process away from my office. I have answered it.

Interjections by hon. members.

Mr. R. F. Ruston (Essex-Kent): More red tape.

Hon. Mr. Timbrell: I don’t know the dates but the Ontario Energy Board will be holding advance sessions for interveners and on Thursday of each week we’ll hold sessions with the interveners to assist them in understanding and evaluating the various materials presented to them. So if the member knows someone or some group that’s having difficulty getting information, or had, in last year’s review, please let me know and I will draw it to the attention of the chairman, Mr. Jackson, because there certainly should be no excuse for that.

Mr. M. Gaunt (Huron-Bruce): Supplementary, Mr. Speaker.

Mr. Speaker: All right, we’ll rotate. We will take a supplementary from the member for Wentworth.

Mr. I. Deans (Wentworth): Thank you. It may sound a bit crazy, but is the government at some point going to make an evaluation of the energy needs of various industrial, commercial and residential sectors as they grow, and make a determination as to what would be the most appropriate source of energy to be used by those areas, rather than having hydro competing against gas and competing against oil as a heating source, or in other areas? Is the government prepared to decide at some point that the percentage of the overall growth that should be allocated for hydro purposes is one particular percentage, and given the amount of oil and other sources of energy that is available those sources should only be used in certain instances?

How do we decide? I realize that I am worrying with a particular question, but at some stage we have got to decide, surely, the appropriate use of hydro over and against gas and against oil. Is the government going to make those kinds of decisions -- to say that a particular subdivision or particular houses, or in a particular area it costs more overall to heat by oil than by hydro and therefore it shall be done by Hydro? Is the government going to make those kinds of determinations?

Hon. Mr. Timbrell: Mr. Speaker, I am having some difficulty with the question. I tend to read into it, and correct me if I am wrong, that the hon. member is suggesting pricing of the various forms of energy on the basis of their equivalent heating values.

Mr. Deans: No, I am talking about their uses.

Hon. Mr. Timbrell: All right; looking at the total situation with gas and oil, one must bear in mind that 80 per cent of the energy consumed in this province comes from outside of this province, so in fact electricity is the only one we can really have a handle on and rely on as a reliable source.

Hon. J. W. Snow (Minister of Government Services): Well handled.

Hon. Mr. Timbrell: Looking at the situation with gas and oil we will, I think, as we get further down the road, have to consider -- and I am not saying that next week I am going to announce anything on this but this is a concern to me -- getting into the business of perhaps allocation of supplies and various other things of that sort. It is under consideration and it is a serious concern to me, yes.

Mr. Speaker: Order, please. I think we have now spent 10 minutes on this one question; I think we perhaps could get back to the supplementaries in the form of a new question later. Does the hon. Leader of the Opposition have further questions of other ministries?

Mr. Gaunt: I was up first.

Mr. Speaker: If everybody is agreeable, I am. The member for Huron-Bruce.

Mr. Gaunt: Mr. Speaker, a supplementary: What portion of Hydro’s projected growth is earmarked for export, and has this percentage changed over the last year?

Hon. Mr. Timbrell: The member will have to understand that since Thursday afternoon I have read a lot of figures and I’ll have to get those figures for him. They don’t come to mind right offhand but I will get them for him.

Mr. Speaker: All right. New question?

HOUSING STARTS

Mr. R. F. Nixon: I would like to direct a question to the Minister of Housing. Is he sticking with his projected 90,000 starts, in view of the figures that have come out of CMHC indicating that for the month of March the number of urban starts in Ontario was 2,258 compared with 5,844 for March a year ago, a drop of 61 per cent? In particular, there is the fact that our starts are down overall in urban Ontario by 58 per cent, which is a performance of something like 16 per cent lower compared with the urban centres elsewhere in Canada?

An hon. member: The minister asked for it.

Hon. D. R. Irvine (Minister of Housing): Yes, Mr. Speaker, I am still sticking with my previous statement that we would achieve 90,000 starts, approximately. I also have said before that we are very fully aware the starts will be down in the next two months, but they will increase substantially in the last third and fourth quarter. The figures the Leader of the Opposition has supplied us with today are no different than I had expected.

Mr. R. F. Nixon: Well, then, supplementary: Does the minister not feel a very deep concern that his best efforts are not being rewarded with the kind of speedup in housing starts we must expect if we are going to come even near 90,000, let alone a return to the level previously experienced two years ago?

Hon. Mr. Irvine: Mr. Speaker, certainly I am concerned; and I have relayed that concern, not only here but to Mr. Danson and to the private sector which is responsible for the majority of the starts. We all have to work together; I have said this many times before. I think we will achieve it, but it is not going to be an easy goal, that’s for sure.

Mr. Deans: The minister won’t get 60,000 starts.

Mr. Speaker: The member of Ottawa Centre.

Ms. M. Cassidy (Ottawa Centre): Mr. Speaker, a supplementary: Since what really counts as far as people buying or renting is concerned are the number of units coming onto the market in the form of completions, and since completions did not fall this year but were projected to fall very sharply in 1975, can the minister now tell us: What is the figure for completions in urban Ontario cities, what is his projection there and what will that do to housing prices and rents?

Mr. Speaker: That’s the sort of question which should be left for a new question. We were talking about housing starts and now we are talking about completions. While this is related to the same overall topic, it is really a new question.

Mr. Cassidy: They are pretty much related, Mr. Speaker.

Mr. R. F. Nixon: They are very closely related, I think.

Mr. Lewis: As a matter of fact, you have caught the government policy well, Mr. Speaker; you understand the distinction; congratulations.

Mr. Speaker: The member for York Centre. Is this a supplementary?

Mr. D. M. Deacon (York Centre): Supplementary: Has the minister considered increasing the OHAP support for municipalities by making it an annual grant over a period of years, instead of this $600 amount which seems to be completely inadequate in connection with the cost municipalities have to bear in new subdivisions?

Mr. Lewis: Now that’s a new question.

Mr. Speaker: I was thinking that. I was reflecting upon it. Could that wait until we get to the new question period? The hon. Leader of the Opposition.

FLOOD DAMAGE ASSISTANCE

Mr. R. F. Nixon: I would like to put a question to the Chairman of Management Board, in the absence of the Minister of Natural Resources (Mr. Bernier). Is there sufficient information available for Management Board to make a decision as to what kind of assistance will be available to individuals and municipalities that had extraordinary expenditures in connection with the flood on the Grand River, the Nith River, the Maitland, et cetera, and other streams in southwestern Ontario a week ago?

An hon. member: Where is et cetera?

Mr. R. F. Nixon: Et cetera is a very full-flowing stream.

Is the minister going to bring forward some assistance, particularly to the municipalities which were able to make use of the early warning system this year much better than last year? In fact, they undertook the kind of expenditure which in the long run is saving the taxpayers a lot of money, particularly in a community like Paris where the damage was much reduced over last year.

Hon. Mr. Winker: Mr. Speaker, I have already spoken to my colleague, the Minister of Natural Resources, who isn’t here today. We are going to examine the proposals and requests that were made to us based on the merits of each case, and we will be reporting on that particular basis.

Mr. R. F. Nixon: Supplementary: Since this would be a departure, that is requests from municipalities are going to be considered in the same light as requirements for assistance for individuals who had flood damage, is it the understanding that municipalities will be able to participate directly in special additional grants to compensate them for the extraordinary expenditures they undertook?

Hon. Mr. Winkler: At the moment, Mr. Speaker, I did not make that statement. I said it would be based on the policy that’s in place.

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

ONTARIO HYDRO SPENDING

Mr. Lewis: Mr. Speaker, I want to go back to the Minister of Energy for a moment, if I may. I will make it an interrogative. Since his statement today affirmed Hydro’s commitment to an expenditure of $23 billion by 1982, and since one of his prime concerns as I jotted it down was the amount of money that is being spent on interest rates on the foreign loans, and since the level of increase for rates now is somewhere in the vicinity of 30 per cent, can he explain how there is any way in the world that Ontario could afford that degree of capitalization over the next several years? And since the minister knows it is not possible, when will the government policy change?

Hon. Mr. Timbrell: Mr. Speaker, the hon. member either knows something about what I think that I don’t, or he has been listening to me talking in my sleep; I don’t know which.

Parts of the programme up to 1982, of course, are still under review by the government. As the member knows, a number of projects were given approval in principle in June, 1973, are still being reviewed, one being the possibility of a second station at Bruce, Darlington near Bowmanville, and so forth.

I don’t accept the member’s conclusion that we can’t afford it. In many respects, we can’t afford not to do it. I read, over the weekend, some remarks attributed to the hon. member, and I had some difficulty understanding where he was getting his figures, inasmuch as the only way I could see of arriving at his figures, given Hydro’s projections, would be to cancel everything and build nothing from now until 1982, that is based on what Hydro has projected.

I don’t accept we can’t afford it. I would say to the member that when we consider the other factors, the outside sources of energy, the probabilities of growth in demand for Hydro; really, without being committed to growth, as I said, for the sake of growth and without being committed unnecessarily to projects either too early or of the wrong kind, we can’t afford to stop everything.

Mr. Lewis: By way of supplementary, I’m not asking the minister to stop; but he does concede, that the most recent prediction by Mr. Taylor on 1974-1975 dollars is an expenditure of $23 billion by 1982 if the programme goes forward, and nothing has reversed as yet. On page 3 of the statement, the minister says, other important factors include the high cost of borrowed money. When will he reach the point of no return in his madness?

Mr. Deans: After the lights go out.

Hon. Mr. Timbrell: That’s an interesting point. I think some people actually think we could stop everything in the Hydro system and then when there is a problem say, “All right, patch it up. Build a plant, build a line; whatever.”

The enormous lead times, of course, for generating stations, transformer stations and transmission lines are such that we can’t do that. We’re looking at 12 years’ lead time now for a generating station. We can’t do that.

I don’t know what the member means by the point of no return.

Mr. Lewis: The point of returning the cash.

Hon. Mr. Timbrell: The government, of course, has to approve Hydro’s borrowings and on a regular basis we keep under review the needs and the market. We’re not about to over-commit the province. I think the fact that we have a triple-A credit rating at this time is evidence we’ve managed it very well.

Mr. Ruston: The government needs more than a triple-A credit rating.

Mr. R. F. Nixon: A supplementary: Is it because the Treasurer (Mr. McKeough) and the Minister of Energy have increasing confidence in their ability to borrow Arab dollars that they can look at this $23 billion with such equanimity? Is the minister involved in the decision which the Treasurer announced in the question period on Thursday, that an agreement with Arab countries has been arrived at for a loan for Hydro? Is that where the $23 billion is going to come from?

Mr. Lewis: It’s a dangerous business dealing with the Middle East, my friend.

Hon. Mr. Timbrell: Mr. Speaker, I haven’t seen the details of my colleague’s announcement.

Mr. R. F. Nixon: Those Arab countries are going to require a reshuffling of cabinet.

Hon. Mr. Timbrell: What was that?

Mr. R. F. Nixon: They only deal with certain corporations.

Hon. Mr. Timbrell: Mr. Speaker, this has been discussed several times before in this House. I don’t know and I don’t think any member of this House could predict with any degree of certainty what the sources are going to be in a year or two. The market is changing in such ways that it is very difficult.

Mr. R. F. Nixon: Is the government going to borrow Arab dollars? That was announced.

Hon. Mr. Timbrell: If that was announced by the Treasurer, he looks after the borrowing, through our advisers.

Hon. A. Grossman (Provincial Secretary for Resources Development): That’s our money. It’s been recycled.

Mr. R. F. Nixon: The provincial secretary is going to have to alter his speeches.

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

Mr. Lewis: If members think Herb Gray had something to speak about!

STATUS OF PHYSICALLY DISABLED PERSONS

Mr. Lewis: May I ask a question of the minister of Community and Social Services? Last June the minister made a commitment to the Legislature to review all of those who were deemed to be permanently unemployable but not disabled -- some 6,000 to 10,000 people, so he indicated in the debate -- and to reduce the number significantly by allowing many to enter the GAINS programme. Is that review completed? How many people have been removed from the category of permanently unemployable?

Hon. R. Brunelle (Minister of Community and Social Services): To my knowledge, Mr. Speaker, that review has not been completed. Quite a large number have been transferred and I would be pleased to send information to the member as to the member that have been transferred. If the member has any specific case he wishes to refer to me, I’d be pleased to review it. I missed his programme last Saturday night but I’d be pleased to review the case he referred to.

Mr. Lewis: Specific cases make the point, and they’re for the Minister of Housing. But in this minister’s instance, is he prepared to remove now, since it must affect a very few thousand people in Ontario, the discriminatory provision of categorizing people as permanently unemployable, denying them the $100-a-month additional money or more they would be entitled to were they disabled, since, according to the minister’s colleague on his immediate right, as stated last Friday morning, no definition has yet been given to the distinction between permanently unemployable and physically disabled?

Hon. Mr. Brunelle: Mr. Speaker, there is a very clear definition, as the hon. member is probably aware, in the Family Benefits Act between a permanently disabled person and a permanently unemployable person. As the hon. member also knows, there is cost sharing under the Canada Assistance Plan --

Interjection by an hon. member.

Hon. Mr. Brunelle: There is cost sharing with the federal government, and there are some very distinct guidelines as to that. So I would like to remind the hon. member these are matters we have to consider.

Mr. Speaker: Does the member for Nipissing have another supplementary?

Mr. R. S. Smith (Nipissing); Is the minister indicating that because of the Canada Assistance Plan he cannot do away with those permanently unemployable people that are referred to and put it all under disabled? Is that what he is saying; or is that what he is trying to infer?

Hon. Mr. Brunelle: No, I didn’t say that, Mr. Speaker. I think the hon. member will read Hansard and see that. What I said is that we do share under the Canada Assistance Plan and we do recover 50 per cent of what we give under the Family Benefits Act. In order to maximize the amount of assistance we can recover from the federal government, we have been using their guidelines. At the same time, it doesn’t necessarily mean to say we are restricted from paying, say, 100 per cent of the difference of the cost.

Mr. Speaker: Any further questions?

Mr. Lewis: Supplementary, if I may. Is the minister saying he will continue to penalize this group? It couldn’t be more than 3,000 people in Ontario now, and we are talking about $3 million a year. The government gave $410 million to the corporations. Is he saying he will continue to penalize these 3,000 people because he gets a cash return under the Family Benefits Act that he doesn’t get for his additional chunk of GAINS payment? Does that make sense to the minister?

Hon. Mr. Brunelle: If the hon. member was listening when I spoke, I told him we were reviewing each and every individual case of those who are classified under the Family Benefits Act. Quite a large number had been transferred under the GAINS programme and we are reviewing each individual case.

Mr. Lewis: The minister will give us the numbers, I am sure.

Mr. Speaker: Final supplementary.

Mr. R. S. Smith: The minister is well aware that this has been going on for about three years and has been under review for about three years now; that’s true.

Hon. Mr. Brunelle: In all due respect, it has not been three years.

Mr. Speaker: Order, please. Is there a question?

Mr. R. S. Smith: Yes, I will ask three questions. Would the minister assure the House that if there is no extra cost to the province in so far as the Canada Assistance Plan is concerned, that the permanently unemployable designation will be done away with and the 50 per cent funding by the federal government will be received?

Hon. Mr. Brunelle: Mr. Speaker, we plan an income review meeting in Ottawa this week on Wednesday and Thursday with the federal government and the other provinces, and this is one of the subjects that will be discussed.

Mr. Lewis: Change this government’s policy.

Mr. Speaker: Any further questions?

RENEWAL OF LEASES

Mr. Lewis: One last question of the Minister of Housing. Will the Minister of Housing request an amendment to the Landlord and Tenant Act, making it necessary that a landlord give cause for non-renewal of a lease to any tenant as a condition under the Act?

Hon. Mr. Irvine: Mr. Speaker, I will certainly give it consideration, but the Act presently is not under my jurisdiction. It is under the jurisdiction of the Attorney General.

Mr. Lewis: By way of supplementary: Since the minister has tenant rent review problems referred to him, I thought it appropriate to ask if he recognized that it is a loophole in the Act which allows any landlord to refuse renewal of a lease for no reason whatsoever and a tenant has no protection in Ontario? Does he think that fair?

Hon. Mr. Irvine: Mr. Speaker, I certainly recognize that exists in the present Act. Personally, if I was responsible as a landlord, I would not have that happen.

Mr. Speaker: Questions? The member for St. George.

LIMITED-DIVIDEND HOUSING

Mrs. M. Campbell (St. George): My question is of the Minister of Housing. Some days ago, the minister stated in this House that the proper approach of government was to provide new housing to overcome the problems in the city of Toronto. Does he recall on that occasion he said there would be two programmes for Toronto, one for Metropolitan Toronto senior citizen housing and one for limited-dividend housing? Was the limited- dividend portion of the housing this province is to supply that which has been announced by CMHC for the whole of Canada, of which 3,000 are for this area? Was that the reference?

Hon. Mr. Irvine: No, Mr. Speaker, it was not. I was referring to the $42 million that we, the Province of Ontario, put into the limited-dividend programme, with some of the units being built in Metropolitan Toronto. I believe the CMHC proposal the hon. member is talking about is one which should close very shortly and should be announced by the minister, Mr. Danson; it is to be hoped that there will be quite a few units in Metropolitan Toronto, but I’m not aware how many there will be.

Mrs. Campbell: A supplementary, Mr. Speaker: In view of the minister’s answer, I wonder if he could say now whether he is aware of what the rentals will be on these limited-dividend housing units? Would he agree they would be around $200 a month for the poor?

Hon. Mr. Irvine: Mr. Speaker, I can’t give a definitive answer at this particular time. I will look into the actual proposals that are before us, as far as the province is concerned. I wouldn’t have any idea what the rents are going to be for the federal government until such time as the proposal is accepted.

Mrs. Campbell: I was referring to limited- dividend housing.

Mr. Speaker: The member for Wentworth.

HAMILTON AREA HOME PROGRAMME STANDARDS

Mr. Deans: Mr. Speaker, I have a question of the Minister of Housing. What’s the relationship between the very tough inspection procedures that were pursued by the supervisor of inspectors in the Hamilton area under the HOME programme and the fact that he’s been relieved of his responsibilities in that area?

Hon. Mr. Irvine: Mr. Speaker, in regard to the overall inspection of our housing units, whether in Hamilton or elsewhere, I have instructed my staff to make sure that we handle the inspection of all our houses very carefully. There’s a review under way right now, and I expect I shall be able to have further details for the hon. member later on this week or early next week.

Mr. Deans: A supplementary question: Did the builders in the Hamilton area make representation, either written or oral, to the HOME programme bosses or whatever the minister wants to call them, the directors of the HOME programme, that the supervisor of the inspections in the Hamilton area was too tough, that the inspection procedures he personally carried out were embarrassing to them and that they wanted someone in his place who would be more amenable to overlooking, as they had in the past, many of the flaws in the buildings?

Hon. Mr. Irvine: Absolutely not, Mr. Speaker. As a matter of fact, the exact opposite would be the correct answer, because I have instructed my staff to ensure that the inspectors are much tougher in their inspections than they have been in the past and that I don’t want to have any more complaints about deficiencies if they relate to our inspectors. So the inspector was not relieved because the builders had asked me, because they have never asked me; and I have no knowledge of them asking any of my staff either.

Mr. Deans: One final supplementary question: How can five inspectors inspect 500 homes adequately? How can they possibly inspect all of the homes of all of the builders currently being built under the HOME programme in the Hamilton area, and expect to be able to check on all of the various steps and procedures required in order to ensure properly built homes?

Hon. Mr. Irvine: Mr. Speaker, that’s part of my review and that’s one of the reasons I have said I would look into the matters brought forward by the hon. member.

Mr. Speaker: The member for Essex-Kent.

AUTO PARTS HAULAGE RATES

Mr. Ruston: Mr. Speaker, I have a question of the Minister of Transportation and Communications. Is the minister aware of a special rate structure that Laidlaw Transport now has through the Interstate Commerce Commission to haul auto parts from the United States to places in Ontario; and that the general consensus is that all rates should be uniform? Is he further aware that this new rate structure is not uniform with the usual code in Ontario?

Hon. J. R. Rhodes (Minister of Transportation and Communications): Mr. Speaker, I would not be aware, because in that case I believe those particular rates would be filed with the Niagara Frontier Tariff Bureau. They are not brought to my attention. I’m sure the hon. member knows the system. I have heard, though, that the rates being charged are lower than the usual rates, and I would hardly think we would complain about lower rates for hauling within the Province of Ontario.

Mr. Speaker: The member for Windsor West.

CONSTRUCTION WAGE RATES

Mr. E. J. Bounsall (Windsor West): I have a question of the Minister of Labour, Mr. Speaker. Is the minister aware that it is now some six to seven years since the minimum and overtime wage schedules for carpenters and other trades have been revised under the Industrial Standards Act; and when can we expect these long overdue revisions to the schedules to be made and announced?

Hon. J. P. MacBeth (Minister of Labour): Mr. Speaker, the schedule that has been referred to is obviously not a very accurate schedule. We have under consideration at the present time the possibility of updating it, in view of some of the complaints we are meeting in the construction field. But as I say, it hasn’t been done for some time and I can’t predict when it will be done. It is one of the things we are looking at, sir.

Mr. Bounsall: Supplementary, Mr. Speaker.

Mr. Speaker: Supplementary?

Mr. Bounsall: Supplementary, yes. Is it one of the functions of the construction industry review panel to come up with those wage schedules and revisions; and if so, is the minister asking them directly to take action at this moment on this overdue problem?

Hon. Mr. MacBeth: I’m certainly not asking the panel to take action on it at the present time; and I’m not going to say we are going to wait for the panel to report. As I say, it is one of the instruments they may use in their examination and we don’t want to rule that out. On the other hand, I’m not ruling out the possibility of the ministry doing something about it in the interval.

Mr. Speaker: The member for Windsor-Walkerville.

HOME IMPROVEMENT FUNDS

Mr. B. Newman (Windsor-Walkerville): Mr. Speaker, I have a question of the Minister of Housing. Is the minister aware that approximately 22 per cent of the homes in the NIP area in the city of Windsor will require more funds than the maximum of $5,000 available under the Residential Rehabilitation Assistance Programme; and that 11 per cent of the homes in the same area will require more than the combined $7,500 worth of funds under both the Residential Rehabilitation Assistance Programme and the Ontario Home Renewal Programme? Is the minister aware that nearly all of the 11 per cent are people who, under this programme, would be unable to borrow enough money, so that all of the work over a maximum of $7,500 would have to be financed? And is the minister aware that these 11 per cent of homeowners are subject to prosecution in the courts and could lose their homes because of their inability to comply with the minimum housing standards? Will the minister, in response, raise the maximum loans available under RRAP and OHRP; and will the minister provide funds to non-profit groups which could help the poor and the elderly to keep and repair their own homes?

Mr. Speaker: Order, please; lengthy questions ofttimes take up more time than the answers, especially when they are multi-part. I would ask the members if they would try to ask the question once, not three or four times. The same thing with the answers, of course.

Hon. Mr. Irvine: I’ll try to do my best, Mr. Speaker. The responsibility for the RRAP programme is not a responsibility of the Province of Ontario, but is a federal programme and in this area one can piggy-back the RRAP funds and/or the OHRP funds. We provide, as I hope the hon. member is aware, funding for non-profit organizations, which could be either a municipality or a group within the municipality, and I would be quite receptive to any application they wish to make in this regard for that particular area he is talking about.

But I would think that with all the funds that are available through the federal government and ourselves, there should be no one evicted because of the house not being up to standards.

Mr. B. Newman: Supplementary, Mr. Speaker: Is the minister aware that the combined funds available under both the provincial programme and the federal programme would be insufficient to enable those people to repair their homes, and that they are unable to borrow funds because they are poor and elderly?

Hon. Mr. Irvine: No, Mr. Speaker, I have to say to the hon. member, with all due respect, I can’t see how the homes would not be repaired to the standard they should be, if they make full use of both programmes. They might not have a home at all to begin with.

Mr. B. Newman: It’s not enough.

Mr. Speaker: The member for Sandwich-Riverside.

TRUCK LOAD COVERS

Mr. F. A. Burr (Sandwich-Riverside): Mr. Speaker, a question of the Minister of Transportation and Communications: When may we expect additional regulations under section 66 of the Highway Traffic Act to ensure the proper covering of trucks, especially those loaded with gravel on our highways?

Hon. Mr. Rhodes: Mr. Speaker, that regulation will be forthcoming.

Mr. Speaker: The member for Etobicoke.

STRIKE AT NCR

Mr. L. A. Braithwaite (Etobicoke): Mr. Speaker, I have a question of the Minister of Labour. Is the minister aware that on April 1, 1975, when local 28B of the Graphic Arts International Union struck the National Cash Register of Canada Co. in Rexdale, it sent a telegram to management asking that negotiations begin at once? And is the minister aware that to date the management has not even acknowledged receipt of the telegram? Will the minister use his good offices to urge the company to commence negotiations immediately; and will the minister consider meeting with a representative group of the union members from local 28B of the Graphic Arts International Union?

Hon. Mr. MacBeth: I think there were four questions there, sir. To the first and last question, no; to the middle two, yes.

Mr. Speaker: The hon. member for Nipissing.

HOUSING FOR METIS AND NON-STATUS INDIANS

Mr. R. S. Smith: Mr. Speaker, I have a question of the Minister of Housing. Was he aware of the meeting of the Ontario Métis and non-status Indians last Monday to which he was invited in regard to housing for those specific people; and could he tell the House why he did not attend that meeting?

Hon. Mr. Irvine: Yes, I would be only too pleased to, Mr. Speaker. The meeting was called for April 21, I believe. I was in Kitchener at the time at a housing conference, which was well attended by about 450 people. At that time some of my colleagues in the House were also there.

I arranged with the Métis group and with Mr. Danson to have my parliamentary assistant and my deputy minister there at the same time for the session of which the member speaks.

The meeting was held at 2 o’clock and went on to 4 o’clock. I am hopeful that I will be able to sign an agreement. I have extended an invitation to Mr. Danson to sign an agreement this Thursday when he is in Toronto, which will relate to two agreements, one being the one to which the member has referred, covering rural and native accommodation in Ontario.

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

OTTAWA FESTIVAL OF FLOWERS

Mr. Cassidy: I have a question of the Minister of Industry and Tourism. Did the minister’s ministry give a grant of $9,000 to the spring festival in the city of Ottawa? Was the grant linked with the requirement that York Advertising Ltd. be used as the agency? And was it also linked with the requirement that the ministry’s money be given directly to York Advertising rather than be paid to the city, and if so, why?

Hon. C. Bennett (Minister of Industry and Tourism): Mr. Speaker, we are participating in the Festival of Flowers in the nation’s capital. Our only requirement and suggestions were that the Province of Quebec should go into the project jointly with the Outaouais authority and the Ottawa-Carleton region in the promotion of that particular part of Ontario and Quebec.

There was no indication that any advertising agency had to be used, sir. It was entirely at the discretion of the organization at the local community level. We have only participated by nominating one representative of the organization and we have gone no further into the situation with them. The bills related to the cost of the programme on which we are sharing costs will be submitted to us and are not to exceed $9,000.

Mr. Speaker: The hon. member for Waterloo North.

USE OF WOOD AS FOOD

Mr. E. R. Good (Waterloo North): Thank you, Mr. Speaker. I have a question of the Minister of Agriculture and Food. Has the minister been in touch with Prof. Murray Moo-Young, at the University of Waterloo, who has developed a technique for changing the cellulose content of wood into protein, which he claims has a great possibility for use as cattle feed and maybe eventually human food?

Hon. W. A. Stewart (Minister of Agriculture and Food): Mr. Speaker, I have not been in touch with that professor, first of all. There is a research project going on at Kemptville Agricultural College which is making use of the fibre content of wood as cattle feed. It’s a research project completely.

Mr. Good: Supplementary, Mr. Speaker: As this process does not use the fibre content but the cellulose content, would the minister have someone in his ministry contact the professor at the University of Waterloo to see whether there is potential in his discovery, which is evidently reaching quite a prominence now in the media?

Hon. Mr. Stewart: Thank you. We’ll take a look at it.

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

WCB VOCATIONAL REHABILITATION PROGRAMMES

Mr. Bounsall: I have a question of the Minister of Labour, Mr. Speaker. Is the minister aware that when the Workmen’s Compensation Board sends a worker back to school through a vocational rehabilitation programme, should that worker become ill for a day or longer on a problem not related to his injury, the board deducts the full amount of those days off the Workmen’s Compensation allowances; if so, does the minister feel this is at all fair?

Hon. Mr. MacBeth: Mr. Speaker, I’m not aware they were doing that. I’m not sure whether it is fair or not. I suppose if he was on the job ordinarily, depending on what agreements they may have, he would have lost a day’s sick pay. I’ll examine it, Mr. Speaker.

Mr. Speaker: The member for Downsview.

VISIT TO INDIAN RESERVES

Mr. V. M. Singer (Downsview): A question of the Provincial Secretary for Resources Development: Presuming this past weekend was the weekend when he and his cabinet colleague journeyed to Grassy Narrows, could he advise the House what success he had in solving the problems and what methods have been worked out for feeding the Indians there whose only resource for food is mercury-polluted fish?

Hon. Mr. Grossman: Mr. Speaker, in the first place, I think I should correct the member. He is not quite as familiar with matters relating to Indians as I am. Fish is not their only source of food; I’ll tell the member that. Yes, I was there all day Saturday and I’ll have a statement before the House tomorrow. It’s being prepared at this present moment. We dealt with quite a number of things; I think we have resolved that particular problem.

Mr. Speaker: The member for Ottawa Centre.

FILM CENSORSHIP

Mr. Cassidy: A question of the Minister of Consumer and Commercial Relations, Mr. Speaker: In view of the minister’s comments after he went to view that selected series of shorts at the Ontario film censors’ office; in view of the fact the Ontario government through the film censor has control over the films exhibited in the province; and in view of the fact that a number of scenes of explicit violence have been permitted by the film censor over the past few years -- ranging from films like “Bonnie and Clyde” and “The Godfather” to some like “Straw Dogs” which are very violent, to others which defy mention in this House -- is it the minister’s intention now to instruct the film censor to take a different attitude toward film violence than he has in the past? If so, why were these instructions not carried out sooner in view of the government’s current campaign?

Hon. S. B. Handleman (Minister of Consumer and Commercial Relations): Mr. Speaker, certainly it is not my intention to instruct the censor. The censor has to make judgement decisions based on the best information available to him as to what is acceptable in Ontario society and what is not acceptable. Those are always judgement decisions and I don’t believe I would impose my judgement on him or his board.

In my view, what they have allowed to go is acceptable in society. There may be some exceptions, but for the most part what they’ve cut out is not acceptable and I would certainly vouch for that.

Mr. Cassidy: Supplementary, Mr. Speaker: The minister is saying that what has been allowed to go through the film censor over the past few years is generally acceptable and he would not wish to have seen it changed. Is that correct?

Hon. Mr. Handleman: Mr. Speaker, I am saying in my judgement from what I have seen, which is not very much because I don’t generally attend the cinema, what is being allowed by the censor according to public opinion surveys is acceptable for the most part. There will always be differences of individual opinion. I think we have to try to find some balance between restrictive censorship and complete permissiveness.

Mr. Breithaupt: Can the minister tell us if the films he has seen, the clips from which are acceptable, are any different from the kinds of film being shown on television?

Hon. Mr. Handleman: Mr. Speaker, I think I have just answered the question by saying I hadn’t seen too much of what the censor has released because I don’t attend films on any large scale. From what I’ve heard and the reports made to me, those films which are shown in the cinemas are acceptable; and many of them are not shown on television.

Mr. Speaker: The oral question period has expired.

Petitions.

Presenting reports.

Hon. Mr. Wells presented the annual report of the board of governors of the Ontario Institute for Studies and Education.

Mr. Speaker: Motions.

Hon. Mr. Winkler moves that the standing administration of justice committee be authorized to sit concurrently with the House for its consideration of Bill 35, An Act to amend the Income Tax Act, and Bill 36, An Act to amend the Corporations Tax Act, 1972.

Motion agreed to.

Mr. Speaker: Introduction of bills.

BEDS OF NAVIGABLE WATERS AMENDMENT ACT

Mr. Haggerty moves first reading of bill intituled, An Act to amend the Beds of Navigable Waters Act, 1975.

Motion agreed to; first reading of the bill.

Mr. Haggerty: Mr. Speaker, the purpose of this bill is to provide a uniform interpretation of the deeds of property bounded by navigable waters so that the high water mark shall be deemed to be the boundary of such property.

If the member for Ontario South (Mr. W. Newman) were here he would perhaps endorse the bill. I think the intent of the bill is to ensure that the shoreline shall remain as Crown lands.

Mr. Speaker: Orders of the day.

Clerk of the House: The first order, resuming the adjourned debate on the motion that this House approves in general the budgetary policy of the government.

BUDGET DEBATE (CONTINUED)

Mr. Speaker: The hon. member for Kitchener.

Mr. J. R. Breithaupt (Kitchener): Mr. Speaker, I would like to start my remarks today with some references to the Ontario home renewal programme.

This government had promised to spend some $10 million on this programme but, in fact, has spent less than $1.5 million. The Minister of Housing (Mr. Irvine) has told us over the past period of time that some 3,750 homes would benefit under the Residential Rehabilitation Assistance Programme. In fact, only 1,800 houses were affected, and fewer than 1,300 of a promised 2,000 new units were approved under the community-sponsored housing programme.

Mr. Speaker, we don’t need another round of deception from the government. What we need is some effective action, some effective programmes to build houses.

There is no shortage of land for housing in this province; there is only a shortage of serviced land. But this government, instead of servicing land, has decided to bank it: 17,000 acres in North Pickering; 10,000 acres near Prescott; 2,300 acres in north Whitby; 1,500 acres in south Oakville; and 11,000 acres in Walpole township for the new city of Nanticoke.

Most government landbanks remain undeveloped, even in areas where serious shortages of serviced land are forcing housing prices higher and higher. At least in some cases the government has increased the final price to the house buyer by paying unconscionably high prices to private land assemblers. We have already documented the $2 million profit paid by the Ontario Housing Corp. for land in Milton that was held for less than seven months. In addition, the government’s stated policy is to release its land at market value rather than at cost. In other words, the government is also profiteering and reinforcing rather than offsetting high market prices.

The purchaser must pay for this government profit over many years at very high interest rates. For instance, if the government profit adds $10,000 to the land’s final selling price, the home buyer with a 20-year mortgage at 10 per cent interest would wind up paying some $19,000 extra. That additional $10,000 would add $95 per month to his mortgage payments.

Is landbanking an appropriate activity for the government of Ontario to engage in? Should the whole process of development be questioned? Why should the province be assembling large tracts of new land, rather than creating appropriate conditions for development around existing towns away from the large metropolitan areas?

Perhaps the time has come to consider a massive land servicing programme rather than massive investment in landbanking. If the land speculation tax is effective, then one of the primary justifications for landbanking no longer applies. The question then becomes: Where is it appropriate to foster the building of new homes?

In a recent article entitled “Land Control and Land Prices,” it was stated, and I quote:

“Two objectives are being pursued by landbanking: recapture for the community of the increase in land values which has been created by the community, and cheaper land for the user. The two are obviously mutually exclusive.”

Provincial landbanking policies have in the past been developed with the first objective in mind. The sale of banked land at market prices, which is the present provincial policy, has not resulted in cheaper land. In fact, it can be argued that the entry into a tight land market of a financially strong buyer inevitably causes a serious rise in land prices.

Certainly this has been true in the Kitchener-Waterloo area where 3,000 acres have been tied up in an undeveloped government land bank for eight years now. With money in short supply, the question is whether available money should be tied up in banked land or in providing services for land.

Throughout Ontario, there are many communities with considerable growth potential to provide accommodation for an increased population now and in the future. These communities already have sewage and water systems, schools, churches and recreational facilities. Surely it is more logical, practical and economically feasible to encourage these existing communities to expand and to assist those now wanting to expand rather than developing new town sites.

New towns, like the government’s effort at Nanticoke, first arose in European countries several years ago. In the 1960s in the United States, new towns became a vehicle for corporate enterprise. It is interesting that there have been few successes in the United States and the activity there has been very modest in scale.

Of the eight largest new towns in the United States, comparable to the Ontario scene, the expected completion date is 21 years after the year the land was initially acquired. Every new townsite has an average acreage of 12.500 acres. In considering townsite assemblies made by the Ontario Land Corp., even if we assume they might achieve the same timetables as the US experienced, it is clear that very few homes will rise on these new townsites in time to be useful in the present crisis.

In the United States, the failure to improve the quality of life far outweighs the successes. New towns tend to be sterile. Former urbanites, immigrating to new towns, say they left the city because of congestion, pollution, taxes and the increased presence of undesirable people. To their dismay, they find in the new towns many of the conditions they hoped to escape. They pay heavily for their dependence on cars which, in turn, require spiralling investment in highways. The physical infrastructure of roads, utilities, sewers and water lines has to be developed from scratch at current prices, resulting in a very high initial cost rather than the incremental cost involved in adding to an already existing community.

In this province we need serviced land. We need affordable housing and we need jobs. At the present time here in Metropolitan Toronto, 26.2 per cent of our construction workers are out of a job. We have the building materials, the land, the skill and the labour force. Surely it is not beyond the capacity of this government to put these elements together and devise a practical workable plan to build houses within the financial means of Ontario citizens.

We are tired and the people of Ontario are tired of the succession of schemes touted by this government with great fanfare which within a few months prove themselves ineffectual. None of the programmes, not the HOME programme nor OHAP nor the integrated housing scheme, addressed the fundamental problems of municipal financial inequities. Local councils throughout the province are erecting barriers to moderate housing costs because the servicing costs would further increase property taxes. Just last week the Newmarket Era editorialized:

“York regional council has a number of things to weigh before deciding whether to throw its support behind Ontario’s crash housing programme. First, it must establish the financial implications. If, as council has been told, deficits created by this type of housing will be long-term burdens to York’s taxpayers, Mr. Irvine will have to improve his offer of a three-year offsetting grant.”

There is no point in the Minister of Housing continually berating the local municipalities. They are victims of the horse and buggy tax system that forces assessment planning upon them and which this government has refused to change.

The Treasurer (Mr. McKeough) makes much of his commitment to local government in his budget but like so much else, his actions do not match his words. In fact, the increased municipal grants do little more than meet the commitment the municipalities forced from the former Treasurer (Mr. White) at the Edmonton trilevel conference in 1973. The $67 million surplus on that commitment reflected in this year’s budget is no greater than the $67 million shortfall which resulted last year.

Are our municipal leaders to he ecstatic simply because this government is meeting a two-year-old commitment? Perhaps they should, because it is so unusual.

Another 1973 commitment was to deconditionalize a larger proportion of provincial grants to municipalities. This budget is a step backward. In the 1975 budget unconditional grants to all municipalities are being increased by only 9.8 per cent compared to a 17 per cent increase for conditional grants. Many municipalities have argued over the years that the province should introduce an unconditional grant system which would return control of local affairs to the municipal level. That occurred, basically, at the city of London meeting with the Treasurer on Jan. 29, 1974.

In the 1973 budget, 11 grants were proposed for deconditionalization. In the 1974 budget, nine grants were deconditionalized and 15 grants proposed for deconditionalization. However, the system of municipal grants has long been rigidly tied to conditions imposed by the province. Concerning this question, Lionel Feldman has stated in “Ontario 1945-1973: The Municipal Dynamic” that:

“The 1973 budget statement suggests that there is at least concern about this process of assumption of functions and responsibilities. This, at least, is one interpretation of the proposals for ‘deconditionalizing’ certain grants. The difficulty is that when particular grants are examined, grants such as arena programme, library, museum, weed control, there is not one major municipal programme area from which the province is proposing to remove conditions.”

Mr. Speaker, my review of the budget has unearthed a large number of inconsistencies. I shall only mention five of the most obvious.

Firstly, on page 3, the Treasurer proposed a cut in the retail sales tax in order to stimulate the purchase of automobiles, among other items. The inconsistency arises when upwards of 75 per cent of vehicles used in Canada are made in the United States and elsewhere; so that any real benefit for job creation will not help Ontario to any appreciable extent.

Secondly, on page 4, the GAINS payment in fact declines for every increase in income. The inconsistency arises here in that there is really no incentive for savings income or indeed for any other outside income. This increase will be reduced to nothing after one year of the OAS-GIS cost-of-living adjustments. This kind of indexing in Ontario simply guarantees that pensioners fall further and further behind.

Thirdly, on page 7, we have the small business tax credit. This is only going to help those who in fact are doing fairly well. The amount is only available when there is retained earnings or a line of credit; so this is inconsistent in that the person who really needs the help cannot in fact obtain it.

Fourthly, we have a stimulus for the purchase of equipment such as the excavator crane referred to on page 10. But surely this is inconsistent with the approach by both municipalities and the province itself when we look at the lower priority for capital construction this year. The Treasurer states at page B-17 that “the government has postponed capital projects where feasible.”

Finally, let us turn to page C-9. Here the inconsistency is almost bad enough to be called distortion. Ontario Hydro’s needs are simply removed from the balance sheet. The Treasurer waves his magic wand and the wants of this vast empire disappear.

The Treasurer recognizes, as we do, that Hydro borrowing will be immense and he is hiding the figures by not including them in this table. Last year, Hydro borrowed about $500 million on its own, and the province borrowed $375 million of that amount, which was added to the final figures. This year, Hydro is expected to borrow $1,350 million, as set out on page A-20. Will Ontario have to use its credit on behalf of Ontario Hydro in other markets? In other words, will this become a contingent liability for the province? If so, the figures should be shown, and I suggest that the amount would be close to $550 million.

Any borrowing by any agency for which we are ultimately responsible should be presented in the budget. To have the nerve to state that the figures are not available is deception, and is not acceptable to us.

Well, so much for a few of the inconsistencies in the budget.

On page C-8, the Treasurer states there is certain financing to be determined -- an amount of $575 million for this year. Where are we going to get this money? I expect there are three sources available.

They could, of course, send the former Treasurer off to Kuwait or Saudi Arabia to use his wiles and try to obtain “alms in the name of Darcy.” I do not expect his abilities will be any more successful or acceptable abroad than they are right here in Ontario. The ultimate result would only be to put serious pressure on Canadian exchange rates, which would likely wipe out any commercial edge that such borrowing might have over the long term, even if it was available.

A second source might well be any change and increase in the funds which we are now obtaining in the non-public borrowing category from the Canada Pension Plan and from our own civil service, from municipal employees and from the teachers. The Treasurer no doubt expects that this bonanza will continue for the foreseeable future, but has he noted an article which appeared in the Financial Post on March 15, 1975? Donald Rumball writes that this cash flow of money available for immediate spending is now beginning to decline and will actuarially be reduced to zero in 1982. Then where will the funds come from? Education, hospitals and medicare have all benefited from these payments, which this year alone will amount to about $750 million. Where do we go in a few years when the well is dry?

If the benefits from this programme are increased, as the Canadian Labour Congress asks, then the cash flow will drop to zero in three years, as more of the moneys collected are immediately paid out in benefits. The government is placing what the writer calls “an intolerable strain on future generations” if the programme changes as suggested are ever implemented with the approval of this government.

Perhaps, Mr. Speaker, the Treasurer is not really thinking about going anywhere other than the traditional New York market, which is the third choice open to him. If that is his view, then I warn him that the traditional bond market there appears to have dried up. The US Treasury is gobbling up the money supply and upsetting the bond and money markets, and such fresh fears of a credit crunch are commonly discussed on Wall St., that any recovery of the American economy is likely to be harmed by the continuing pressure.

I suggest the Treasurer refer to the April 12 issue of the Financial Post and read the article which sets out the delay of various security issues and the lack of sales for others. Both British Columbia and the city of Montreal have postponed their planned borrowings. The American Treasury states it must finance some $80 billion this year from this market, and the interest rates which may have to be paid are going to be excessive, if the money is, in fact, available at any price.

If we are, in fact, looking for funds from any other areas then perhaps the Treasurer can explain where those areas are. The three that I have mentioned seem the only practical ones available, and our chances of unquestioned success in any one of them for the future several years appear to be more and more remote.

In the midst of all this, the Treasurer in his budget preparation meetings met with the Ontario Chamber of Commerce. The report for that meeting states the Treasurer is committed to the spending of an extra $100 million per year within the next two years to process the tax returns of the income tax which the province is now apparently committed to collect, separate from Ottawa. The Treasurer is reported to have given the view that there is little or no hope of this decision being reversed.

He states we are to have two tax forms to complete, instead of one, because of what he refers to as a certain “rigidity” in discussions with the federal authorities. If that happens, then we are likely to have to hire an additional 4,500 civil servants to give the province the capability of setting up its own income tax division. As the chamber puts it: “The result of this initiative by the Province of Ontario will be more government as well as more taxation.”

I have heard, Mr. Speaker, that this report may be in error, and that the Treasurer apparently has denied, by letter, the report of what went on at this meeting with the Ontario Chamber of Commerce. I would certainly hope that he would take the first opportunity in this House, or elsewhere, to correct this information if, in fact, he states that the meeting as reported is not accurately reported.

Certainly to proceed now with the separate collection of an Ontario income tax on the basis that that decision is irreversible is a most serious step. I would certainly encourage the Treasurer to correct this particular error if, in fact, the meeting as reported is not the real decision of this government.

Mr. Speaker, the public view of politics usually focuses on specific issues and people. We who are active in politics, whether as elected officials or supporters of a particular party, tend to do likewise. We act and react to hundreds of daily events with the result that distinctions in the philosophies of the various political groupings become blurred. There are many who say the only basic difference between political parties these days is that the one with power wants to keep it and those without power want to get it. It seems appropriate, therefore, that perhaps I could attempt to dispel that widespread belief.

To do so, I naturally turned to Oliver Mowat, a founder of Liberalism in Ontario. An article in Ontario History by A. M. Evans reports Mowat’s opinion on the matter when he is quoted as writing to his mother in 1844 that “the difference of avowed principles between the two parties is all moonshine.” But, when he later became involved in the political life of Canada, even Mowat agreed that:

“Every man must take a side; then he helps to mould the future policy of that side. His motions have the support of his party. He is powerful for good, if good is his object. He gives his adhesion to the only principle on which free government appears to be capable of being worked -- that is, a distinction of parties.”

Mowat recognized that our parliamentary democracy requires organized alternatives to the government. He justified the party system, not through the specific differences in parties, but simply by the necessity for alternative people and policies to ensure that the electors have a choice.

Although Mowat was born a Conservative, he became disenchanted with the Conservative administration of his day. He was 17 when William Lyon Mackenzie led his feeble revolution against the tyrannical rule of the Family Compact and its Conservative supporters. And he must have watched with interest when, 12 years later, the Tories reacted to the establishment of responsible government by a Liberal-dominated assembly by stoning the Governor General and burning the Parliament Buildings.

Eventually Mowat’s disgust with the Conservatives reached the point where he claimed, “Nothing was too bad in legislation or government for them to adopt if it helped to secure their places. Opposition to such a government has become a duty.” Mowat’s outburst reflected his frustration with a particular government at a particular time, but he went on to explain his choice of party by saying, “Such a choice must be made as parties stand when the choice is made and not as they stood at some former period; and once it has been made, an upright man must do his best to keep his party right as well as to obtain for it success.”

Since Mowat went on to become Premier for 24 years, he obviously obtained success for his party and he must have kept his party right too, because the policies he put forward convinced the majority of people in each successive election that they should choose the Liberal Party “as the party stood when the choice was made.”

Today our party and every party in a democracy faces a similar challenge. We must continually adapt our programmes to meet the needs and demands of a changing society. Our task is to form a government by winning broad support among the electorate. Our policies, therefore, must express only the highest common factor of opinions behind which majority support can be mobilized. In any democracy this means that the ideological content of a platform must, of course, be broad.

No viable political party in Ontario, or elsewhere, is prepared to take a substantial philosophical stand which, when compared to the positions put forward by its competitors, would leave it excluded from a substantial area of public concern and policy. Ours is a diverse province, spread across a huge geographic area and populated by persons of wide-ranging economic, ethnic, religious and linguistic backgrounds. No party in these circumstances can afford the luxury of a pure or rigid ideology.

This tendency to overlap and, in fact, walk all over each other’s toes, usually close to the middle of the road, has led to some confusion in the basic ideology of modern provincial parties. This was relieved to some extent in 1970 when the NDP flirted with the return to the CCF ideals of nationalizing industry but, with the expulsion of the Waffle a year later, organized labour regained control of the party and its philosophical direction.

It is a subjective view, indeed, when I charge the Conservatives with the same kind of undeviating commitment to the business community of this province, and reserve for our party the essential Liberal position established historically, and now more important than ever, of representing individuals, including labourers and businessmen rather than the organizations with which they are associated. While we have no qualms whatever about organized labour, or any other groups substantially supporting a party, we have final confidence in the decision of the individual as he or she enters the polling place to follow Mowat’s advice and make a choice, “as parties stand when the choice is made.”

As a member of an organized group, whether it is a union, the medical association, the teachers’ federation or some other group of citizens co-operating for their own welfare and advancement, the elector must and will make a decision, using his or her own judgement of the comparative qualities of the candidates and his or her concern for the issues they espouse.

The Liberal attitude is that people must not be worn down into uniformity. For the politician and the civil servant, this issue means how they will respect the rights of individuals against the power of the state. For society as a whole, it means respect for the rights of the individual against the community at large. In the classic statement of John Stuart Mill:

“If all mankind minus one were of one opinion and only one person were of a contrary opinion, mankind would be no more justified in silencing that one person than he, if he had the power, would be justified in silencing mankind.”

There are countless occasions in government when the most expedient way to get things done is to ride roughshod over the rights and freedoms of the individual. A decision by the province to expropriate 17,250 acres in Pickering township --

Mr. J. E. Stokes (Thunder Bay): What about the 33½ per cent the federal Liberals voted themselves?

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

Mr. Breithaupt: I don’t see how that is particularly relevant with respect to the remarks that I’m making at the moment since that, as I recall, was supported by members of all parties in the federal House of Commons.

Mr. Stokes: That’s not so.

Mr. Breithaupt: In any event, Mr. Speaker, that decision by the province to expropriate that acreage in Pickering township without the normal hearing of necessity is a good example of the kind of thing of which I’m speaking. The Liberal Party believes individualism must not be trampled by expedience; we must achieve our goals without sacrificing diversity.

Opposition to irresponsible political power of man over man is, therefore, the keystone of our Liberal philosophy, but it extends beyond that to oppose unwarranted privilege of any kind. The original revolt of Ontario Liberalism against the Family Compact was an assertion of political equality. For the individual, freedom is incomplete without access to opportunities. It is a basic Liberal principle that we must continually remove barriers blocking the avenue of independent, individual progress.

The task of the Liberal is therefore to fight for this elusive goal, a society in which every individual will have an equal opportunity to learn, to work, to strive, to grow, to achieve, to succeed and, of course, in Ontario I suppose we’ll have to include to stand. This does not mean, of course, that every individual will be equal or will secure an equal share of the fruits of society. People have always been and will continue to be unequal in ability and diligence. Their rewards will, therefore, differ and should differ. But until such person has an equal opportunity to establish his or her own goals and work towards them, our society will have need for Liberals.

The political issue is the extent to which government will intervene to ensure that expanding opportunities spread quickly throughout all the community. Liberals are prepared to utilize government actively. Historically, Conservatives have tended to avoid governmental action, preferring solution to problems by non-governmental intervention. Recently, however, Ontario’s Conservative government has been interfering in the lives of individuals with increasing frequency. The object of this government action has not, however, been to equalize opportunity but to appropriate more and more powers to the provincial government.

Extensive government control is also, of course, basic to the NDP philosophy.

This is an issue on which the philosophy of the Liberal Party differs sharply from those of the other two parties. The local autonomy cry is firmly entrenched in the programme of all political parties but in an examination of Conservative practice it is obvious that the tendency is to centralize substantially many of the responsibilities of government such as assessment and planning which should, in their main application if not in the broad policy, be a function of local government.

The grants by which the province supports the municipalities are really vehicles to leave the decisions in the hands of provincial authorities. The municipalities are left only with the responsibility to raise the residue of funds and to carry the political ashcans when certain planning and development decisions are not locally popular.

The issue of local government is one, once again, on which the Conservative and Liberal philosophies are sharply distinct and the same can be said to a great degree with regard to certain other issues. As we rapidly approach the next provincial election, we in the Liberal Party are applying the philosophic principles which I have just outlined to the development of a programme that will present the electors of Ontario with a clear and responsible alternative to the present government.

It is consistent with our philosophy of individualism that we require substantial involvement from our members in the formation of policy and responsibility from the leadership of the party to account for positions and actions taken. The process is well under way and the results of it will see a platform in place whenever an election is called.

Mr. Speaker, you will recall, I am certain, the items which were contained in the motion on the budget which I had moved following the 1974 budget brought in by the then Treasurer. On that occasion, the motion contained five parts of criticism and I should like to review them with you. The contents of that motion were as follows:

“This House regrets the lack of any government policy to effectively deal with the problems of inflation in areas of provincial concern.

“This House regrets the government’s failure for an effective review of price increases by using a standing committee of the Legislature for such a purpose.

“This House regrets the government’s failure to have a satisfactory policy to reduce housing costs and review rents and to stimulate new housing constructions through such measures as the removal of the provincial sales tax on residential building materials and the servicing of lands in provincial land banks and other areas.

“This House regrets the government’s failure to control exorbitant increases in the costs of regional governments implemented by this government.

“This House regrets the government’s failure to have any effective programme to equalize the costs of living throughout the province or to plan for the balanced development of northern and eastern Ontario.”

Mr. R. F. Nixon (Leader of the Opposition): Excellent.

Mr. Breithaupt: In each single particular, the criticisms of the budget of 1974 are entirely accurate and relevant to the budget of 1975. The government has failed in every one of those areas and the failures prove that this government is not getting better; it’s just getting older. It would appear the government simply is either unwilling or incapable of learning from its mistakes. Perhaps it is, in fact, both.

Mr. R. F. Nixon: Time for a change.

Mr. Breithaupt: Mr. Speaker, it may be that I will have somewhat more influence if I reword and rewrite last year’s comments even though the motion could be put exactly as it was last year and cover the most glaring failures of this government which have continued for yet another year.

However, in the hope that a new approach will get the attention of all the members of the Legislature and may bring the desired result that is so badly needed, I would amend the resolution to read in another fashion.

Mr. Breithaupt moves that all the words after “that” be struck out and the following added:

“In view of the present economic difficulties in Ontario, particularly uncontrolled inflation, substantial and growing unemployment and a critical housing shortage,

“This House regrets that the government has failed to propose measures that will restore confidence in the provincial economy;

“This House regrets that the government’s budget is based on inaccurate assumptions;

“This House regrets that the government has proposed an inflationary level of spending which will result in a substantial deficit and will further undermine the strength of our provincial economy;

“This House regrets that the government has failed to propose any measures that will alleviate the almost complete absence of reasonably priced accommodation;

“This House regrets that the government has failed to offer a sincere programme to increase productivity in the provincial civil service or to propose any measures that would restore stability to labour relations in the public and private sectors;

“This House regrets that the government has failed to demonstrate any competence in dealing with the serious economic problems of economic growth or any determination to reduce either unemployment or regional disparity.”

Mr. S. Lewis (Scarborough West): Until tomorrow, Mr. Speaker, I would move the adjournment of the debate.

Hon. E. A. Winkler (Chairman, Management Board of Cabinet): Mr. Speaker, I recognize that there has been some degree of misunderstanding in the way the business was called and I did speak to the leader of the NDP in regard to his contribution in the debate. Now, because this has developed, I would ask that he withdraw his motion to let us go along with the debate and we will allow him to start the debate at 3 o’clock tomorrow afternoon or following the question period.

Mr. Lewis: Well, Mr. Speaker, just a note of explanation: I wasn’t here at adjournment on Friday, but it said rather specifically that the budget critic of the Liberals would finish today and we would go on to bills. I’m sorry, but some of the materials I want to use, I will not have until tomorrow. I’d be glad to withdraw the motion and continue the debate tomorrow, if the House leader would like. Do I take it he wants to proceed with the budget debate?

Hon. Mr. Winkler: Yes, that is correct; and we’ll allow the leader to proceed, as I said, at the first item of business tomorrow afternoon.

Mr. Speaker: Does the hon. member agree?

Mr. Lewis: Yes.

Mr. Speaker: Does an hon. member wish to take part in this debate?

The hon. member for Prince Edward-Lennox.

Mr. R. F. Nixon: Old reliable. Is he going to run that speech through again?

Mr. J. A. Taylor (Prince Edward-Lennox): Thank you, Mr. Speaker, and I thank the Leader of the Opposition for that round of applause. I truly appreciate his support in the many things that I say.

Mr. M. Gaunt (Huron-Bruce): There is not much other support here.

Mr. R. F. Nixon: The member is alone. There is not another member sitting near him.

Mr. R. F. Ruston (Essex-Kent): There are only four members from his party.

Mr. Speaker: Order, please. The hon. member for Prince Edward-Lennox has the floor.

Mr. G. Samis (Stormont): Where is the rump today?

Mr. J. A. Taylor: It’s very well padded indeed.

Mr. Samis: The spirit of the rump is weaker than the flesh.

Mr. J. A. Taylor: The rump can look after itself.

An hon. member: Not in here they can’t.

Mr. R. F. Nixon: By disappearing this afternoon, they showed they know how to look after themselves.

Mr. J. A. Taylor: To think, Mr. Speaker, of the Leader of the Opposition being so cheeky, especially in view of my silence when the deputy leader of the Liberal Party spoke just a few moments ago -- I would, of course, expect similar respect.

Mr. R. F. Nixon: We should do what the Tories did and just leav., But we won’t bother the member.

Mr. J. A. Taylor: Without being provocative, Mr. Speaker, I would like very much indeed to address myself to the budget and in support of the many matters that are contained in the budget, which I think meets the current economic dilemma that confronts not only Ontario but I think Canada and the world as a whole.

The economic situation is fluid indeed. This government has responded to the concern that we are being faced with recessionary times. At the same time as we experience and see the effects of inflation, we are concerned about stimulating the economy. What the economists call stagflation has certainly set in. If we look to our neighbours to the south, we can see what that great nation is doing in terms of putting many billions of dollars into the economy to stimulate a sagging situation there.

We in Ontario have taken the lead -- there is no question about that -- in this budget in anticipating what the American population has already felt and in doing what we can to stimulate our own Ontario economy and in that way, of course, to assist I would think the rest of Canada as a whole. We’ve already heard that there will be a mini-budget which will be put into effect fairly soon by the federal government. It is expected in May. We can look forward to measures taken by the federal Minister of Finance, hon. John Turner, which no doubt will reinforce the position that Ontario has taken and do what the federal government can do to stimulate our economy as a whole.

We are no doubt suffering from very turbulent times. We’ve heard of labour disputes. The House leader of the Liberal Party made reference to labour and to the unrest that exists in labour today. I’m frightful that the problem in connection with labour strife is symptomatic of a concern generally among the population, not only of Ontario but of the rest of Canada in regard to the escalating inflation that has beset the nation. This is a matter that we have to deal with. Unfortunately, the population is being conditioned to accept very high settlements in terms of wages and these wage settlements are eventually felt in terms of further increase in costs.

We here in Ontario have experienced increases in settlements that were unheard of just a few years ago. We have recently heard of proposed increases sought in regard to the trades -- the carpenters, the electricians, and so on -- that in terms of the newspaper reports are bringing those workers into the area of something between $24,000 and $36,000 per year income. Surely this is not a situation that could be tolerated in our economy and yet the population as a whole, management and government as a whole, is being conditioned to accept very large settlements, whether it be 12 per cent, 16 per cent, 22 per cent, 46 per cent or what have you. They are all very large settlements and should be brought into line. But it has been said, and I think there is a certain element of truth in the statement, that we have to bring the economy into line in terms of escalating costs in order to settle our other economic and social ills.

It would seem that the budget is doing really two things, and implicit in those two things is, in my estimation, an emphasis on the people of Ontario and the private sector of Ontario. In other words, the emphasis is away from government spending and is being concentrated more and more on spending by the people of Ontario and by assisting in the generation of additional economic activity by business and industry in this province. I think that that’s a good thing.

Mr. Speaker, you will note from the budget that every ministry will have to absorb increased costs in those ministries as a result of inflation. Effectively then, their budgets will be cut back to that effect. Also, the total number of persons in terms of personnel will be cut back through attrition, so it is anticipated that there will be a net effect of a 2.5 per cent decrease in the total civil service complement by the end of the fiscal year.

At the same time as the budget proposes that government spending be curtailed, it is doing everything it can to put those dollars into the hands of the little man -- the old age pensioner, the businessman, the farmer, the ordinary working person. If we can talk in terms of philosophy, it is saying, is it not better for people to make their own decisions as to how their money can be spent rather than a government skimming off a big part of their incomes and determining for them how that money is to be spent?

When we look at the budget and we see a sales tax cut of two per cent -- from seven to five per cent -- we can see that that translates into many millions of dollars in terms of additional purchasing power for the people.

I am convinced that that is a good thing and is generally welcomed by the population of Ontario. Again, we can see that the shift is to the people who are trying to acquire housing, and there the province and this government is saying, “Here, let us help those people who are prepared to help themselves.” If they are working hard and trying to scrape enough money together to buy a home then we will give them $1,500; $1,000 initially and two subsequent payments of $250 for each of the two succeeding years to help them to finance their first home.

I think, Mr. Speaker, it is significant that that programme is much superior to the federal programme, which provides for a $500 payment but only in regard to new houses. The Ontario programme applies to old houses as well as to new houses and there is no limit on the amount of money that a person can pay for the home in order to qualify for this particular plan. The limitation, of course, is that it be a first home. I think that has also been well received by the people of Ontario as a temporary measure, of course, to help to stimulate the construction industry and at the same time to assist people in acquiring a home.

The enriched payments to the elderly through the GAINS programme have been very well received and no doubt assist in the older segment of our population keeping pace with the rise in prices and the pressures that they feel. I spoke earlier, Mr. Speaker, of the labour problem and I think we must always be mindful that our elderly population does not have a strong bargaining agent in terms of a trade union or other type of organization. They have worked hard throughout their lives to make a living, to raise their families and, hopefully, to live in a reasonable semblance of comfort during their later years. With the change in our economic system, with increased prices, they are finding it difficult to keep pace with modern times. Therefore, there is no question in my mind that the increase in the GAINS programme will assist them to meet their bills as they become due.

The inclusion of all persons of 65 years of age or over in the plan which will enable them to obtain drugs free of charge, I think, is a very excellent part of the budget. It helps, again, those elderly persons who, in this period of life, find it more necessary to use the services of our doctors, our hospitals and, of course, to purchase drugs. Now it is possible for them to obtain their drugs in accordance with this plan which would effectively put more money into their hands in that they will get this service free. That again is a manifestation of this government’s concern for the elderly and to assist them further in their later years.

Mention was made in the budget of income tax cuts for those persons of modest income. That certainly coincides with the federal philosophy and, I think, meshes very well indeed with that programme so that persons on lower income will not be taxed.

The budget is concerned in regard to the stimulation of the economy through further production. The amendment which exempted the sales tax on production machinery was debated very hotly and it is my conviction that this exemption will certainly encourage and stimulate industry to purchase machinery it otherwise would not have purchased. I think it should be made clear that when we are talking in terms of industrial production machinery, we are also talking in terms of construction machinery such as heavy earth haulers, front-end loaders, crawler-type tractors and excavator cranes. We are also talking of manufacturing equipment and machinery such as mechanical presses, air compressors, grinding machines and lathes. We are also talking in terms of mining machinery, earth boring machines, mounted rotary rock drills and ore crushers. All of these types of production and construction machinery will be exempt from the sales tax.

I mentioned that we are in very fluid times, speaking in economic terms. We are hopeful that the economic picture will brighten toward the end of this year, nevertheless manufacturers, producers, will have to determine whether or not to proceed with an expansion of their plants and with the upgrading of their machinery. In that regard there is no question in my mind that the elimination of the sales tax will certainly stimulate their thought considerably, and, hopefully, entice them to replace outdated or worn machinery and to also engage in plant expansion, so that they will be prepared for the next round of increased production.

The fuel cost reduction is certainly going to help the municipalities. It will apply to their road maintenance vehicles. It will help the school boards and the hospitals. The response, certainly in my riding, has been very good to date in regard to that. It further assists the municipalities in keeping down their costs, again, in a period of rising municipal costs and a period of raising mill rates.

The budget helps the small businessman. The return, I believe, of the compensation for the collection and remission of the retail sales tax was a very good proposal. And while we have heard it said that why should the large merchandisers be paid for the collection and remission of the tax, the proposal is to put a maximum limit of $500 in any fiscal year for the collectors of the taxes. Therefore, the very large merchandisers will not be compensated for any more than $500. At the same time, the small businessman will be able to retain three per cent of the tax collected up to the $500, which will help him out indeed, for a service that he was doing for nothing. That, again, was welcomed. I think it should have been implemented -- and, of course, is being implemented.

The assistance to the farmer is something that is necessary. Farming, as many members know, is a type of business or industry that is risky indeed. It seems that never a year goes by without some segment of the farming community having difficulties. And when everything else seems to be going right, the weather goes wrong. Each farm is really an individual business. They have different conditions. Their lands are different. The drainage is different. Their problems are different. As you know, Mr. Speaker, the beef industry today is suffering dreadfully in terms of its input costs and the cost of its product.

So, the announcement that this government will dovetail into the stabilization plan that is being worked out at the federal level to the tune of some $20 million, I think is welcome news indeed. Previously the programme certainly wasn’t working out too well, when one had to start averaging prices over a period of 10 years. Now, of course, with the foreshortening of that period to five years and taking 90 per cent of the cost rather than 80 per cent of the cost, I think that with the province’s intention to assist in those weaker areas, this should help the farm producers on many of those commodities.

It’s a very difficult thing when we talk in terms of helping the farmer, because I think the farmer is misunderstood -- especially in the urban areas. It is often said, and, I believe, thought, that a farmer can merely add his input costs and feed those into the total price of his product. Well, he cannot do that. In certain commodities that is possible, if he is growing tobacco or certain of the cash crops that may be negotiated in terms of price to the canners, but not in terms of general farming. Therefore, with escalating input costs the farmer -- and today I mentioned the beef farmer -- is often in desperate straits.

Something must be done to assist the farming community. This really worries me, because it is essential, in my estimation, that Canada be self-producing in terms of what it eats. We have all seen what has happened in regard to energy and especially in terms of oil; Canada can be self-producing in terms of its oil requirements. I believe that our agricultural community should be treated in such a way as to ensure that this Province of Ontario and this Dominion of Canada is not dependent upon foreign countries for the food on its table. And if we are not careful that could happen.

We all know what has happened in terms of certain commodities that we do not raise here, such as sugar. We also know that we could have had a sugar business in Ontario had there been some firm federal policy in terms of imports, tariffs and a programme that would ensure the survival of the sugar beet industry. For example, there could have been a commitment that at least 25 per cent of our local requirements would be homegrown, and we could have protected those producers to that extent until they got themselves established and got their operations going. Then we could build from there. Instead of that, it fizzled and we have been subjected to escalating costs and incredible increases in sugar prices. We must always be mindful of the need to grow sufficient food and to ensure that our agricultural community is kept intact and can produce the commodities that we need to feed the population of this province and this country.

The budget provides for an increase in the exemption from succession duties, which I believe will help the farmers and other persons. There was, as we know, a basic exemption of $150,000 which has now been increased to $250,000. When we think that there are many farms that have been handed down from generation to generation, each generation contributing to the capital of that farm, building it up in terms of equipment and buildings, and then when we measure the impact of inflation on the land and on the buildings we can see that it doesn’t take long before a good farm could be taxable for succession duty purposes. I think this certainly assists in that regard. It also provides for the forgiveness period when a farmer wants to transfer his farm to his family. That was previously 25 years and now it is shortened to 10 years.

A similar situation applies in terms of a family business. The basic exemption for gift tax will be raised from $2,000 per recipient and a net aggregate of $10,000 per year, to $5,000 per recipient with an aggregate of $25,000 in each year. It is therefore possible to give to members of the family, within a reasonable period, an asset that a person owns -- such as a farm -- which might be in excess of the $75,000 limit which applies today.

As you know, Mr. Speaker, there was a once-in-a-lifetime special exemption for farmers under the Gift Tax Act which permitted the gifting of $50,000. That, as I mentioned, has been raised to $75,000. That provision extends, as well, to the small businessman. The transfers between spouses, of course, are exempt and will continue to be exempt.

I mentioned that I could see a shift in government policy in terms of concentrating on the private sector on the community as a whole in terms of spending and cutting back on government spending. In fact, the restraints that have been imposed on government spending were pointed out a few moments ago. With the reorganization of government it was necessary, and no doubt it will continue to be necessary, to streamline government operations. We’re always talking in terms of business having to streamline to cut expenses and to keep competitive. We often forget that probably the biggest single spender is government. It is certainly necessary for government to pare its expenditures and to streamline, to cut costs and to cut deadwood if necessary. In my opinion, it is always necessary to cut out the deadwood.

Mr. Stokes: It’s one thing for the government to say it is doing it, but it’s another thing to do it.

Mr. J. A. Taylor: The commitment was made and the commitment is being followed up. If, perchance, this great province of curs was ever ruled by a socialist party, a socialist government, one would see the biggest civil service that anyone would ever see in any place in the world outside of the eastern countries and the Soviet Union.

Mr. Stokes: Just because he says it, that doesn’t make it so.

Mr. J. A. Taylor: There’s no question in my mind that the NDP would homogenize society and turn into a civil servant everyone it could. At the same time, they sit there and condemn the present government for too large a civil service. What I am saying is that we are taking steps to streamline and to pare the costs --

Mr. Stokes: The facts don’t bear it out.

Mr. J. A. Taylor: -- in terms of total numbers of civil servants; and the complement will actually be cut by 2½ per cent next year.

Mr. Stokes: It’s gone up by six per cent in the last year. Just because he is saying it, it doesn’t make it so.

Mr. J. A. Taylor: It’s happening. I don’t wish to repeat or reiterate what I said, but for a party that is committed to the takeover by government of the means of production of this country, I don’t see how anything can be accomplished but additional civil servants, additional people on the public payroll. That is precisely what would happen under any government that the New Democratic Party would ever form.

Mr. Stokes: That’s not so.

Mr. W. Ferrier (Cochrane South): It didn’t happen that way in B.C.

Mr. J. A. Taylor: As a matter of fact, I’ve sat here and I’ve heard members of the NDP talk in terms of confiscation.

Mr. I. Deans (Wentworth): Confiscation?

Mr. J. A. Taylor: Confiscation of the natural resources.

Mr. Deans: Confiscation?

Mr. J. A. Taylor: Yes, indeed. Not expropriation with compensation, but actual confiscation -- and that shocks me.

Mr. Deans: Of what?

Mr. J. A. Taylor: Of the resource industries.

Mr. Deans: That’s not so. That’s not party policy at all.

Mr. J. A. Taylor: If the member will check the record he will see the interjection by the --

Mr. Deans: That’s misleading and, in fact, the member for Prince Edward-Lennox should withdraw it.

Mr. J. A. Taylor: That’s not misleading at all. If the member for Wentworth consults his colleague, the member for Sudbury East (Mr. Martel), he can confirm precisely what I’ve said.

Mr. Deans: That’s completely wrong.

Mr. J. A. Taylor: That shocks me. And to expose the member for Wentworth shocks him, I can see that.

Mr. Stokes: It’s not true.

Mr. Deans: That is a typical Conservative statement; inaccurate, misleading. I don’t understand how the member can get away with that sort of thing.

Mr. J. A. Taylor: Because I’ve talked --

Mr. Deans: He should withdraw from the chamber.

Mr. J. A. Taylor: The truth shall make the member grieve.

Mr. Deans: He is a disgrace to say such a thing.

Mr. J. A. Taylor: Yes, sir. We see how it hurts.

Mr. Deans: To say a thing like that --

Mr. J. A. Taylor: It cuts him to the quick when he is exposed by one of his colleagues.

Mr. Deans: Incredible. I have never heard such balderdash. It is absolute nonsense. How can he stand there --

Mr. J. A. Taylor: He has heard it and no doubt in due course he will regurgitate it.

Mr. Deans: How can he stand there, as a representative of the Province of Ontario, and say things like that which he knows have no foundation?

Mr. J. A. Taylor: I wish he’d take the smirk or smile off his face when he talks like that.

Mr. Deans: I have no smile. How can he stand there as a representative of the public and say things like that, knowing full well there is no foundation for them?

Mr. J. A. Taylor: He is being exposed for what he is. Mr. Speaker, I don’t wish to become provocative but I can see --

Mr. Deans: Mr. Speaker, are you going to allow this?

Interjections by hon. members.

Mr. Speaker: The hon. member has the floor.

Mr. J. F. Foulds (Port Arthur): He’s not doing a very good job of it.

Mr. Deans: Are you going to allow him to make those kinds of irresponsible statements? Totally inaccurate.

Mr. J. A. Taylor: If he will check the record he’ll find out for himself. The real responsibility, Mr. Speaker, is this member denying the facts.

Mr. Speaker: Would you come to order, please?

Mr. Gaunt: I think they are both exposing themselves.

Mr. J. A. Taylor: Except that the member for Wentworth’s exposure is indecent indeed. The assistance to the --

Mr. Deans: On a point of privilege.

Mr. Speaker: On a point of order. The member for Wentworth, what is your point of privilege?

Mr. Deans: I want that remark withdrawn.

Mr. Speaker: What remark is that?

Mr. Deans: The remark made by the member who was just speaking who said that my exposure was indecent. I want it withdrawn and I want an apology. That was completely uncalled for. It’s unparliamentary and I want it withdrawn.

Mr. Stokes: And not true. It’s false.

Mr. Speaker: I’m sure the member for Prince Edward-Lennox will withdraw the remark about the member for Wentworth being indecent. I’m sure he’d want to retract that statement.

Mr. J. A. Taylor: Mr. Speaker, may I point out that in --

Mr. Deans: Mr. Speaker, on a point of order, I want a withdrawal without explanation.

Mr. J. A. Taylor: Mr. Speaker, may I point out --

Mr. Deans: On a point of order, it is either withdrawn or not withdrawn. There is no opportunity for discussion.

Mr. Speaker: If you give the member for Prince Edward-Lennox --

Mr. Deans: He is not entitled to explain. Either he --

Mr. Speaker: Order, please.

Mr. B. Gilbertson (Algoma): Who is boss around here?

Mr. Stokes: He made the statement.

Mr. Speaker: Order, please. The member for Prince Edward-Lennox will withdraw it. He has indicated he’ll withdraw it. I’m asking him to withdraw the statement saying the member for Wentworth is indecent and I’m sure he’ll do that.

Mr. J. A. Taylor: Mr. Speaker, I didn’t say that.

Mr. Stokes: He did.

Mr. Deans: He did.

Mr. J. A. Taylor: How can I withdraw something I didn’t say?

Mr. Stokes: He did.

Mr. Deans: He did.

Mr. J. A. Taylor: Let him read the record back, see what was said and not be so sensitive. Any interjection is out of order.

Mr. Speaker: Order, please. The Deputy Speaker will report this to the Speaker tomorrow and after we have had a chance to look at the records the Speaker will deal with the matter. The member for Prince Edward-Lennox may proceed with the debate on the budget.

Mr. Stokes: The member is being reported to the Speaker.

Mr. J. A. Taylor: Thank you, Mr. Speaker. The member for Thunder Bay doesn’t intimidate me.

An hon. member: Why doesn’t he take it a little deeper?

Mr. J. A. Taylor: If the member could learn to be quiet maybe he wouldn’t expose himself to the ridicule he’s been exposed to.

Mr. Deans: I see. Now he is softening it a little. Maybe if he would tell it as it is, we wouldn’t have to interject.

Mr. Speaker, I don’t believe there’s a quorum.

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

Clerk of the House: Mr. Speaker, I see 18 members.

Mr. Speaker: Nineteen.

Mr. Deans: No, you see 18 members.

Mr. Speaker: Nineteen plus the Deputy Speaker makes 20.

Mr. R. D. Kennedy (Peel South): Proceed.

Mr. R. G. Eaton (Middlesex South): Well, there’s a group down in committee too.

Mr. Stokes: No way. Either we have a quorum or we don’t.

Mr. Kennedy: He said 20.

Mr. Eaton: What about all the fellows down in committee?

Mr. Ferrier: Ring the bells again.

Mr. Speaker: Do I understand there is not a quorum?

Clerk of the House: There is not a quorum here, sir.

Mr. Kennedy: I see 20.

Mr. Speaker: Our orders indicate if there is not a quorum that we record the attendance of those present and adjourn the House until tomorrow --

Mr. O. F. Villeneuve (Glengarry): There are 20 people in here.

Mr. Speaker: -- unless we have unanimous consent to do otherwise, but that’s what the order says.

Mr. Kennedy: Mr. Speaker, there is a quorum now. There is a quorum.

Mr. Stokes: There wasn’t when the Clerk counted --

Mr. Kennedy: With respect, Mr. Speaker, there wasn’t a quorum; I have just counted now, and there is.

Mr. Speaker: Order, please. I announced the procedure when the Clerk announced that there was not a quorum. I understand there was not a quorum, so that is the procedure.

Mr. W. Hodgson (York North): Mr. Speaker, I don’t know --

Mr. Stokes: Is the Deputy Speaker challenging the Speaker’s ruling?

Mr. W. Hodgson: Calm down. I am asking for a ruling of the Speaker.

Mr. Speaker: Order, please. I think we have no other course but to do this, unless we have the unanimous consent of the House.

Mr. H. Worton (Wellington South): That’s a rule of the House.

Mr. Speaker: It is a rule of the House.

Mr. Kennedy: Let it be recorded that there are two Liberals.

An hon. member: And three NDPers.

Mr. Speaker: Order, please. Those who are in the House at the time the Clerk announced there was not a quorum will please come forward and sign the attendance register.

Mr. W. Hodgson: Mr. Speaker, I would like to ask a question on procedure. Who instructs the Clerk to take the count at the particular time?

Mr. Speaker: Mr. Speaker.

Mr. W. Hodgson: Well, the Deputy Speaker or acting Speaker at the time hadn’t instructed the Clerk at that particular time to take a count.

Mr. Stokes: That is automatic.

Mr. Speaker: Well, a count was taken and the Clerk reported it. So, based on the standing orders --

Mr. Deans: On a point of order --

Mr. Speaker: Yes.

Mr. Deans: My recollection, though I don’t have my rule book with me, is that in the event that the bells have rung for four minutes and no quorum is present, the bells shall ring for a further period and then the count shall be taken and reported.

Mr. Speaker: As I understand, I think I’m clear that if you’re in committee, the bell rings for four minutes and if there is not a quorum then it is reported to the Speaker, who shall request that they be rung for four more minutes and then the House shall adjourn if there is not the required attendance.

I declare the House adjourned until 2 o’clock tomorrow afternoon and the members who were present when the bells stopped ringing -- I understand there were 18 or 19 -- will sign the register.

The names of the members were taken down as follows:

PRE5ENT

Mr. Speaker

Deans

Dymond

Eaton

Ferrier

Hodgson (Victoria-Haliburton)

Hodgson (York North)

Kennedy

Maeck

Paterson

Rollins

Root

Scrivener

Stokes

Taylor (Prince Edward-Lennox)

Villeneuve

Winkler

Worton

The House adjourned at 4:25 o’clock, p.m.