Legislative Assembly of Ontario

The House met at 2 p.m.

Prayers.

STATEMENTS BY THE MINISTRY

AIR SERVICES

Hon. Mr. Snow: Yesterday in Winnipeg the Canadian Transport Commission convened a hearing to consider certain applications which will have a significant effect on the future of air services in Ontario. Of the six applications before the commission, four concern Ontario directly. They are the application by Transair Limited to suspend service to Dryden, Thunder Bay, Sault Ste. Marie and Toronto; the applications by Nordair and Great Lakes Airlines Limited to serve these points and Winnipeg as well; and the application by Canadian Pacific Airlines Limited to serve Thunder Bay en route between Toronto and Winnipeg.

Ontario has a significant interest in the outcome of these applications and, accordingly, I have intervened on behalf of the government of Ontario in these proceedings. For your information, Mr. Speaker, the other two applications involve the sale of Transair Limited to Pacific Western Airlines Limited and a move by Transair Limited to add certain points in western Canada to its licences. Because neither affect Ontario directly, we have not intervened in these particular applications. However, on the other four applications, we are being represented at the Winnipeg hearings by legal counsel who offered the following prepared statement. It is as follows, and I quote:

“Before the committee proceeds to hear these applications, I would like to address a few comments to the commission to outline the basis of Ontario’s participation. As we have made clear in our intervention in the Transair application, we have no interest in the acquisition of Transair by Pacific Western Airlines, nor do we have any interest in the addition of points west of Winnipeg to Transair’s licences. Our concern in these proceedings is that service to the points in Ontario, presently served by Transair, be provided by a strong regional carrier with access to other regional points in Ontario.

“Other regions of Canada are served exclusively by a single regional air carrier. For instance, in western Canada, Pacific Western Airlines provides such a service exclusively. We believe that the travelling public in Ontario would best be served by one healthy regional air carrier operating throughout the province. At the present time, there are three air carriers providing a regional type of service in Ontario. These are Great Lakes Airlines Limited, Nordair Limited and Transair Limited. Additionally, Air Canada also serves as a regional air carrier in Ontario.

“It is obvious to us that what is required is one strong regional carrier operating in harmony with the two excellent national trunk carriers and with the feeder services, including norOntair. Such a regional carrier must have access to all key regional centres in the province, including Thunder Bay. Our reading of the recently issued Transport Canada discussion paper is that it supports the concept of a strong regional air carrier system.

“The application of Transair to suspend services to these points raises a number of questions which will have to be resolved by the Air Transport Committee. It is the responsibility of this commission to ensure that the appropriate level of service is maintained to these points. Dryden is uniquely affected by these proceedings. It is the only point affected which is not served by Air Canada in addition to Transair.

“The committee now has before it two fresh applications to assume all points in Ontario to which Transair seeks to suspend service. Effectively, the committee has before it then three possible carriers, including Transair, to provide service to these points. Air Canada has indicated its intention to increase services to all points involved except Dryden. As well, the committee has an application by Canadian Pacific Airlines to add the point Thunder Bay to its existing licences.

“Ontario has no objection to Canadian Pacific Airlines serving Thunder Bay provided that: Firstly, CP Air’s entrance into the Thunder Bay market does not preclude service to this point by the regional carrier -- a regional carrier must be able to serve Thunder Bay in order to develop a stable commercial operation; and secondly, provided that CP Air’s schedules in and out of this point are co-ordinated with those of Air Canada and the regional carrier and feeder services, including norOntair, so as to provide the travelling public with the best possible scheduling.

“In determining these applications, the commission should take into account the following considerations: Firstly, the successful carrier must be dependable and capable of providing services on a commercial basis over the long term. The determination of these applications must also take into account the economic realities of the market. We have no wish to have to go through these proceedings again because the carrier selected has been unable to provide the service required on a continuing basis.

“Secondly, the successful carrier must provide good interline connections with norOntair feeder services at all the points under examination. The route flow under consideration is regional in nature and must provide scheduling which is compatible with local services in the north not only for norOntair but with other feeder-type carriers as well.

“Thirdly, Air Canada and CP Air, if Thunder Bay is granted, must co-operate with the successful carrier or carriers. The regional carrier will be unable to operate effectively and provide a reliable service unless there is full co-operation between the successful carrier and the mainline carriers. A harmonious working relationship among Air Canada, CP Air and other carriers serving the region is vital if public needs are to be met adequately.

“Fourthly, the point Dryden must be served in a manner which will adequately meet the needs of the public travelling through that point.

“Fifthly, the successful carrier must be prepared to use appropriate equipment geared to the requirements of the market.

“As we proceed in this hearing, these will be the basic points that the government of Ontario will be concerned with. The commission must examine at least these basic points in discharging its responsibility. The committee has an arduous decision to make. It is a decision that will affect the quality and level of air services throughout northwestern Ontario for some time to come.

“These are times of significant change in the air carrier industry in Canada. These are the proposals that are being presented at this time. One regional air carrier has applied to purchase another. Transair has applied to suspend service to a large geographical area of Ontario and Canada. Other carriers have applied to take over and serve this vacated area. Discussions and debates are under way in government and industry as to the best future structure of the air carrier industry. The public is increasingly concerned with efficient and appropriate air service and its costs. We urge the committee to take the opportunity presented by this hearing and make appropriate decisions which will ensure a better coordinated and healthy air service for Ontario.”

That was the position paper put forward on behalf of the government of Ontario in Winnipeg yesterday.

MUNICIPAL LICENSING ACT

Hon. Mr. McKeough: At the appropriate time this afternoon I will be introducing a new Act, the Municipal Licensing Act for first reading. This follows my announcement to the Provincial-Municipal Liaison Committee last April that the government intended to completely overhaul the legislative provisions for municipal licensing. It also follows the publication of a paper by the Association of Municipal Clerks and Treasurers of Ontario on this subject, a discussion paper prepared in my ministry and what I hope has been a productive period of discussion with the liaison committee and other municipal representatives.

It is my intention to have the bill widely distributed to municipalities and all other interested parties to generate as much interest and comment as possible. I will not proceed with the bill until the spring so that I can take into consideration all views that will be expressed to me.

The bill is in line with a number of general government policies. It gives municipalities a general power to license business, thereby increasing the power of municipalities to make decisions. Municipalities will no longer have to come to the province for new powers when they see a local problem in need of regulation.

We feel municipal licensing should not be used as a source of revenue, so this Act eliminates licensing fees in all but two kinds of licences. The liaison committee agreed with us on this, but opted for fees that would cover administrative costs. On this we differed. The government is saying no fees. If licensing is for the purpose of protecting the public from unfair or unsafe business practices, as it should be, then the cost should be covered by general revenues.

It is also hoped that the no-fee provision will encourage municipalities to deregulate, to licence businesses only when it is in the interests of the general public to do so. The bill eliminates archaic and unnecessary sections from the Municipal Act as part of our ongoing process of revising municipal legislation.

Mr. Sargent: And a lot of staff too.

Hon. Mr. McKeough: The new legislation enables all local municipalities to license businesses. It makes no distinction between cities, towns, villages and townships. It removes all bylaw powers from police commissions and transfers them to the local council, in keeping with the principle that laws should be made by elected representatives.

Members will note I said local municipalities. This agrees with the recommendation of the clerks and treasurers and the PMLC recommendation that residual licensing power be left with local municipalities. Under the new Act, counties will not be able to pass licensing bylaws; however, we will amend the regional Acts, when the Municipal Licensing Act proceeds in the spring, to ensure that any licensing that regions are now doing continues.

There are still some problems we will have to solve before the new legislation takes effect. We have not eliminated the duplication of the provincial and municipal regulation of trades, for example. This is something I will be looking at with the Minister of Colleges and Universities (Mr. Parrott). I will also be in touch with other ministers about Acts under their aegis which affect municipal licensing to see how their provisions fit in with this new bill.

[2:15]

This legislation would come into effect a year from now, on January 1, 1979, in order to give the municipalities time to review their licensing bylaws after the legislation goes through the House in the spring. I hope at that time the municipalities will undertake a careful examination of their bylaws and eliminate those that duplicate regulation by the province or other agencies; and remove those things that can be better regulated by zoning bylaws and those that have outlived their usefulness. These steps would contribute to the process of deregulation we are committed to promote in this province.

Just adding to that briefly, this matter was discussed with my colleagues in caucus this morning and the member for London South (Mr. Walker) made a very excellent suggestion, which I think will certainly be incorporated in the bill when it is reintroduced in the spring. That suggestion would be to apply a sunset provision to municipal laws.

Mr. S. Smith: Sunset begins at home; the Treasurer is good at tightening everybody’s belt except his own.

Mr. Conway: The member for London South may soon be good enough for the cabinet.

Hon. Mr. McKeough: In this way, those bylaws which will be passed by the municipalities under the new Act when it becomes operative would then be coming up for a review, and for possible abolition I suppose, at a period, say corresponding to the life of the council, or perhaps every three or four years.

It was an excellent suggestion made by the member for London South and I can only say to my colleagues here in the House that I would expect it would be incorporated in the legislation.

Mr. S. Smith: Apply it to yourself.

Mr. Nixon: Who’s this fellow standing up here?

Interjections.

Mr. Speaker: Can we have some order please? The Minister of Housing.

Mr. Peterson: Why should the minister be in the shadow of the Chairman of Cabinet (Mr. Henderson)?

Hon. Mr. Rhodes: Why should the member for London Centre be in the shadow of his leader?

Mr. Peterson: I always look up to my leader.

SETTLEMENT CORPORATION

Hon. Mr. Rhodes: Last week the hon. member for Wentworth (Mr. Deans) asked a question of me. I would like to reply to it at this time, because it is rather lengthy and I don’t want to use the time of the question period.

The hon. member for Wentworth asked some questions regarding Settlement Corporation and the HUDAC warranty program, and suggested shoddy workmanship was responsible for the company being refused a licence by HUDAC. It is my understanding that Settlement was constructing several projects last spring, some financed by Ontario Mortgage Corporation under the HOME plan, and some financed privately with units selling up to and including $100,000, which is somewhat higher than HOME plan accommodation.

The builder got into financial difficulties in the early summer, and one of the chartered banks put in a receiver-manager under a Supreme Court order in the latter part of August. At the same time, a trustee in bankruptcy was appointed. OMC, acting as a financial lending institution in respect of three condominium corporations financed by the corporation, started a power of sale action in respect of the Berrisfield and Quinndale developments. This was done not only to protect the interests of the corporation, but to improve the living environment for the residents already living there by completing necessary work.

OMC could not proceed with another project, also involving Settlement, in the face of a court order, but it did co-operate with the receiver-manager supplying necessary documents and plans. However, since no action was apparently being taken, OMC applied to Osgoode Hall to have the order quashed. With the consent of the receiver, it was successful.

The order was quashed on Monday, November 7. OMC awarded contracts the following day and completion work began in the Berrisfield and Quinndale projects soon afterwards. On November 10, OMC officials met with representatives of the condominium corporations and their lawyers in Hamilton to explain in detail what was happening, the financial problems and outlining OMC’s plans. At the same time, these people were advised as to the steps they should take with HUDAC. For the hon. member’s information, I would be pleased to send him a copy of a special newsletter from the condominium corporations, dated November 14. I believe he would be interested in it.

There was some problem of down payments and reduced mortgage assumptions for five of the purchasers in one of the corporations. It’s my understanding that HUDAC has received formal applications and the matter is being dealt with at the present time. So the hon. member can see that his implication that Settlement was deregistered by HUDAC because of shoddy workmanship is not correct.

Mr. Deans: It should have been.

Hon. Mr. Rhodes: The matter centred on the company’s inability to complete work because of its financial difficulties. I am not saying that Settlement was the perfect builder. In other projects there were problems and there were meetings. It was a slow process but the deficiencies were eventually rectified.

With regard to the hon. member’s question about the Saltfleet development, I have asked my staff to review all of the housing in Saltfleet. I am aware of one company which has been instructed to clear up deficiencies, but I do not know of any others. If he has information pertaining to other builders, I would be happy if he would let me know.

As I said, when the hon. member asked about Satellite City, the HUDAC warranty covers what he referred to as cosmetic repairs in the first year of occupancy and structural repairs for five years. This applies only to units covered by the HUDAC warranty, which came into effect at the beginning of this year. We are following up on units which were constructed prior to the introduction of that warranty program.

ALLOCATION OF TIME FOR PRIVATE MEMBERS’ BILLS

Mr. S. Smith: May I rise on a point of order just before the question period, Mr. Speaker? The point of order is that I have looked over the scheduling for the remaining time of the House and I note there seems to be no provision made for any of the private members’ bills to be actually looked at within the committees to which they were sent. I guess they are all going to die on the order paper as present plans would seem to have it.

I personally feel that was not the intention of the private members’ hour. I would like to see us either stay a little longer to debate them or have the government give us some indication it might stand these bills over along with certain others I think it intends to stand over to the new session, so that at some point at least the committees would have some chance to consider these bills.

I feel very strongly about it. I don’t wish to be contentious, but I do believe it was the intention of the House that things like our party’s small business bill, the bill of the hon. member for Mississauga South (Mr. Kennedy), another one from the member for Middlesex (Mr. Eaton), and so on, should be debated.

I wonder if the government might take into consideration the feelings of private members on both sides of the House in this regard.

I have stated my point and I can carry on with the question period now if you like, Mr. Speaker, unless the Premier (Mr. Davis) responds.

Mr. Deans: If I may speak to the point of order --

[Applause.]

Mr. Deans: I did not expect that much applause. Thank you very much.

Mr. Riddell: Let the member enjoy it while he is getting it.

Mr. Roy: Wait until he gets the leadership, then he won’t get any.

Mr. Riddell: He had better enjoy it now, because he won’t get it again.

Mr. Deans: I didn’t think you guys cared.

Mr. Kerrio: I like the member for Ottawa Centre (Mr. Cassidy).

Mr. Roy: That is hardly leadership dress the member for Wentworth has there.

Mr. Speaker: Can we get on with the more important business of the House?

Mr. Deans: I only wear it on the days when the member for Ottawa East is here, once every two weeks.

Mr. Roy: Where is his tie?

Mr. Mackenzie: The member for Ottawa East should go and comb his hair.

Mr. Martel: He wants to be on the record so they will know he is here.

Mr. Makarchuk: He should go and get another hairdresser.

Mr. Martel: The member for Ottawa East in on the record now. He can leave for the rest of the week.

Mr. Ashe: Mr. Speaker, get some order here.

Mr. Deans: Mr. Speaker, speaking to the point of order, since the matter has not been dealt with by the House leaders at this point, it is a matter of concern for all of us. I want to suggest one other matter that might be considered.

Since even referring the bills to committees would not mean they would automatically receive any further consideration, it might be better if we got an agreement from the government that all of the bills that have received second reading would be put back on the order paper at the beginning of the new session in order that they could not only be considered by the appropriate committee, but they could also be given the opportunity for third reading.

Mr. S. Smith: That is what I said.

Mr. Roy: That is what he suggested.

Mr. Deans: We don’t have that understanding now. The committees that have already been structured have their workload established. It might be better that we simply get an understanding that the bills will go back on for second reading in the next session and that they will then be sent to committee in order that they could be given third reading at some appropriate time.

Mr. S. Smith: I believe that is what I said.

Mr. Deans: No it was not, because they cannot be dealt with by the committees.

Hon. Mr. Davis: I think this is a matter that could very easily be discussed with the House leader. There are a number of vehicles whereby some of these bills could he further considered. It may be that some private members, on careful reflection over the recess, might want to reassess their own position as it relates to some aspects of the legislation that has been introduced; and of course there is nothing to preclude the reintroduction of the bills.

Mr. Nixon: They won’t come forward.

Mr. Martel: You’re looking bad now.

Hon. Mr. Davis: Well, Mr. Speaker, you know you can call it by some other name, but I would suggest that --

Mr. Conway: Does the member for Parry Sound (Mr. Maeck) agree with that?

Mr. S. Smith: Let’s stay here and discuss them then.

Hon. Mr. Davis: Mr. Speaker, the Leader of the Opposition wants to stay here an additional period of time to discuss the private members’ bills.

Mr. S. Smith: That’s right.

Hon. Mr. Davis: That, of course, is one option that is always available to us.

Hon. Mr. Rhodes: Let him stay, he won’t be long anyway.

Hon. Mr. Davis: However, I would suggest that this is a matter to be discussed by the House leaders; I’m sure with their collective wisdom they will come up with a solution that is acceptable to the members of the House.

Mr. Eakins: Mr. Speaker, on a point of order.

Mr. Speaker: I think it is becoming a debate.

Mr. Eakins: I think it’s a very important one.

Mr. Speaker: We have an undertaking from the Premier that it will be discussed among the House leaders. We cannot resolve it here. It’s getting down to a debate. I’ll recognize the hon. Leader of the Opposition for a question.

Mr. Eakins: Is it back to the lottery for the members who have already submitted their bills?

Mr. Hodgson: Sit down.

Mr. Martel: Careful now.

ORAL QUESTIONS

JOB CREATION

Mr. S. Smith: My question is for the Premier: Since the number of unemployed young people has risen by 7,000 in the recent statistics during the month of November, and since the summer program which the government introduced has obviously run out; why will the Premier not now introduce a winter program similar to the one that was operated this summer, along the principles that we have suggested, supplementing the income of new employees so as to mitigate the effects of what is obviously going to be a very harsh winter of unemployment?

Hon. Mr. Davis: Mr. Speaker, we’re very pleased with the results of the program that was introduced far young people during the summer months. There is a national program, as the Leader of the Opposition well knows, and I would suggest that we await any policies that may emerge in the budget that will be forthcoming.

An hon. member: When winter’s over.

Mr. Martel: That will help them; that will really help.

Hon. Mr. Davis: It is not our intention at this moment to re-introduce that program, as much as we are concerned about the employment opportunities for young people.

Mr. Wildman: No election this winter, eh?

Hon. Mr. Davis: I would just say to the Leader of the Opposition, we’re aware of his point of view and --

Mr. Cassidy: Doing nothing about it.

Hon. Mr. Davis: Mr. Speaker the members opposite can say we’re doing nothing about it.

Mr. Cassidy: That’s what we said.

Mr. Swart: It’s your concern.

Mr. Laughren: That’s what you just admitted to.

Hon. Mr. Davis: That’s the traditional posture for the member for Ottawa Centre, and I understand that.

Mr. Samis: Do you want to tell us what you’re doing?

Mr. Cassidy: We’ll take that message across the province too.

Hon. Mr. Davis: I’ll tell you, it would be a great improvement over the message you’re presently taking across the province.

Hon. Mr. Rhodes: The member for Ottawa Centre did that last June; all wrapped up in the same plastic bag.

Mr. S. Smith: By way of supplementary question, what specifically -- and I use the word “specifically” --

Mr. Samis: Nothing.

Mr. S. Smith: -- is the Premier recommending either to the Prime Minister of Canada or to his own cabinet, to deal with serious unemployment over this winter in Ontario? Does he have a single specific measure, or has he basically just accepted, as the budget paper seemed to do, a high level of unemployment in Ontario?

Hon. Mr. Rhodes: Get the cameras on; they are really putting on a show.

Hon. Mr. Davis: Mr. Speaker, we have not accepted a high level of unemployment in this province. The Treasurer has made it clear, as I have on a number of occasions, that the present level of unemployment is not acceptable, and we don’t minimize it.

Mr. McClellan: What will solve it?

Mr. Wildman: Tell everybody you don’t accept it.

Hon. Mr. Davis: We’ve also made it very clear that we don’t believe the answer is in massive government expenditure --

Mr. Wildman: What is the answer?

Hon. Mr. Davis: -- and development of programs, that perhaps at best are very short-term. We are maintaining our approach for limiting expenditure by government --

Mr. Samis: We’re Herbert Hoover today.

An hon. member: A chicken in every pot.

Hon. Mr. Davis: -- in the anticipation, and one, I think, can --

Mr. Makarchuk: Known as public sector bashing; that is not a program.

An hon. member: He’s looking for a scapegoat.

Mr. S. Smith: Ignore that; I’d really like an answer.

Mr. Peterson: Just stand there and evince concern.

Hon. Mr. Davis: Mr. Speaker, I’m delighted to have these interjections in the recognition --

Mr. Samis: You have nothing else to say.

Hon. Mr. Davis: -- that to solve this problem on a more lasting basis, it does require, on the part of all governments, a degree of intestinal fortitude that is not always easy to demonstrate.

Mr. Makarchuk: How about some cerebral fortitude?

[2:30]

Hon. Mr. Davis: I’ve said in this House before, Mr. Speaker, it would be much easier for this government to say yes to a lot of, I should say constructive, suggestions that are made; and I don’t minimize those. It would be a lot easier for us to say, “Yes, let’s increase the deficit, or in some way expend further taxpayers’ money.”

Mr. Wildman: Have you anything specific?

Hon. Mr. Davis: But, Mr. Speaker, we do not believe that on a provincial basis, alone in particular, this will provide any worthwhile answer.

There will be two or three matters that I will be bringing to the attention of the Prime Minister and the other first ministers, on the assumption there is a conference on the economy of this country in February; and it’s my expectation, now that Mr. Levesque has indicated he will participate in such a conference, that the Prime Minister will announce the convening of this meeting sometime this week. That’s just a guess.

Mr. S. Smith: Hurray, hurray. What good will that do?

Hon. Mr. Davis: Mr. Speaker, the Leader of the Opposition can say hurray, hurray in a very cynical way. If he doesn’t want such a conference; if he doesn’t think there is some leadership necessary --

Mr. Samis: The answer is no; you have nothing specific.

Mr. S. Smith: What proposals will you offer at the meeting?

Hon. Mr. Davis: -- if he doesn’t recognize that the basic economic problems are really within the jurisdiction of the government of Canada, then as I’ve said on a number of occasions he still has a lot to learn.

Mr. S. Smith: So what are you doing?

Hon. Mr. Davis: Mr. Speaker, we’re concerned, but I’m not going to lead the members of the House astray and say we have a large number of short-term programs up our sleeves; that, in our view, would not deal realistically with the problems we face.

Mr. S. Smith: Only to learn that you can’t run this province economically.

Mr. Conway: The Charter is not a bad start.

Mr. Lewis: While I’m sure the Premier realizes the seasonally-adjusted rate of unemployment and number of unemployed in Ontario this month is the same as last, does he also realize that between October and November, 1977, there was the single most dramatic drop in the last year in the number of people actually working? Does he not realize we are some 25,000 jobs down amongst the people actually employed? And does he not, therefore, recognize that some job creation initiative must be undertaken by his government to take effect in the coming winter months? It is not enough, surely, to talk about his intestinal fortitude; what is the Premier going to do about the fortitude of the people who are not working?

Hon. Mr. Davis: Mr. Speaker, we’re concerned about the people who cannot find employment, I don’t minimize that; that concern is not a market cornered by the members opposite. I think the leader of the New Democratic Party, perhaps with greater sensitivity than the Leader of the Opposition, recognizes that we have this same concern.

Mr. Lewis: Then do something.

Mr. Peterson: You’re too cheap.

Hon. Mr. Davis: It may be, but I’ll not pursue that any further.

Mr. Lewis: I don’t blame you.

Mr. Sargent: That is pretty shaggy.

Mr. Lewis: It is not productive.

Mr. Conway: That’s not very gracious.

Hon. Mr. Davis: Mr. Speaker, I would say to the leader of the New Democratic Party --

Mr. Lewis: On this there is no bridge across the chasm between us. I say to the Premier, through you Mr. Speaker, do something about job creation. I can stimulate the Premier into abuse very easily. It is about time members on that side over there stopped posturing about jobs.

Hon. Mr. Davis: I’m not looking for any bridge, and I’ve got to tell the member at this moment that in answer --

Mr. Speaker: Order. The hon. member for Grey-Bruce has a supplementary.

Mr. Sargent: The headlines in today’s Toronto Star were: “The Worst Unemployment Since the Great Depression.” Accepting the fact that the meeting of the first ministers --

Hon. Mr. Rhodes: Talk to Trudeau.

Mr. Sargent: -- with Trudeau is a decision day to decide the route we’re going to take in Ontario in dealing with 300,000 unemployed people; and realizing that the Premier is locked in financially, with an upcoming billion and a half deficit, and that he has absolutely no programs in place at all to provide jobs; I ask the Premier as a supplementary, will he in view of this upcoming meeting, appoint an all-party committee, based on a make-work project as was the federal program in 1963 when they had seven per cent unemployment? They put it through with your co-operation here and it brought it down to three per cent. I will send you the facts of this now, sir, and I would ask you seriously to look at an all-party program to put Ontario back on track.

Hon. Mr. Davis: Mr. Speaker, I appreciate the suggestion from the member for Grey-Bruce. I really can’t say that I think that an all-party committee to assist us in the discussions in February would necessarily be the most helpful route to go.

Mr. Makarchuk: Not as good as your budget in April.

Hon. Mr. Davis: While I appreciate the suggestion, I would have to say to the hon. member that I really haven’t considered that and I doubt that sort of thing would emerge.

I would also point out that while we are concerned about the figures, if you analyse them carefully they also demonstrate something else, and if you look at the headlines in today’s Star, I am not disputing them. The headlines do reflect the national picture. I don’t say that Ontario is that much better than the other provinces of Canada, but I think it is somewhat better than the majority.

Mr. McClellan: You are Herbert Hoover.

Hon. Mr. Davis: I think the figures will also show -- and it has been no mean accomplishment -- that over a year ago there have been 100,000 new jobs created in this province and the figures there show that.

Hon. Mr. McKeough: One hundred and thirty-seven thousand.

Mr. Foulds: That is like two trees planted for every one that has been cut.

Mr. Speaker: The hon. member for Hamilton West with his second question. We have spent 10 minutes on this one.

Mr. Peterson: On a point of order, Mr. Speaker, there have only been two supplementaries to this very important problem.

Mr. Speaker: There have been three supplementaries and they have all been lengthy.

Mr. Peterson: They should have been cut down.

AUTO PACT

Mr. S. Smith: Another question for the Premier on a related topic: Is he aware of the increase of $265 million in Canada’s auto trade deficit with the United States, bringing the total to close to $1 billion in a 10-month period? Can he tell us whether he plans now to call together the automobile industry, the auto parts industry and the labour unions that are involved to formulate an Ontario strategy regarding the auto trade matter, and then to make that particular strategy public and take it before the meeting that he’s talking about with the Prime Minister, which is going to occur in the near future? Why can’t Ontario take a public position about the auto trade which is so important to our own future economically?

Hon. Mr. Davis: Mr. Speaker, that of course has already been done.

Mr. McClellan: Don’t be too sure.

Hon. Mr. Davis: There have been a number of discussions internally within the government, with the auto parts manufacturers, with the automobile producers and with the ministry in Ottawa. I have discussed this with the Prime Minister. I am relatively satisfied that this will be a matter on the agenda in February and everything that the Leader of the Opposition suggested we do has in fact been done. This has been made very clear to the government of Canada, where, of course, the responsibility for alterations in the existing auto pact lies. In fairness to him, I think the Prime Minister of Canada now has some sense of this priority in this province and hopefully it will demonstrate itself in some alterations.

Mr. S. Smith: May I ask what did the Premier recommend to the Prime Minister of Canada during his discussion with him with regard to the auto pact, in specific terms?

Hon. Mr. Rhodes: Doesn’t he talk to you, Stuart?

Hon. Mr. Davis: To put it in its most simplistic fashion, so that it will be understood, we suggested to the Prime Minister in terms that he understood -- not only did he understand them, he understood why I was suggesting it, very simplistically -- we want to see more of the automobile production and the parts manufacturing done in the province of Ontario. That, in its simplest terms, is what was suggested to the Prime Minister and that, in essence, is really what it’s all about.

Mr. S. Smith: How is the government going to deal with the companies to make sure they shift production here?

Mr. Cassidy: Is the Premier aware of any co-operation from the automobile companies and the auto parts manufacturers in this regard? If so, is the Premier satisfied with that co-operation? If not, what is the Premier going to do about it?

Hon. Mr. Davis: I would say the auto parts manufacturers are totally co-operative, and that’s a very important part of the industry. They want to see more, naturally. I can’t quite understand the question. The automotive parts manufacturers have made their views known publicly in this province. They want to see more of that work done by Canadian manufacturers. We have accepted this. Not only have we accepted it, we have encouraged it.

Mr. Cassidy: You answered only half the question.

Mr. Breaugh: Mr. Speaker, I wonder why the Premier is making that magnificent gesture to save what we already know has to be saved. Would he tell the House what he is doing to save the production facilities that we now have, the jobs that are presently there? Given that we have already had layoffs at Ford in Oakville and that there is soon to be another coming from my loving and caring multi-national in Oshawa and another one in Windsor, will he tell the House what plans he has to see that those jobs in production are retained?

Hon. Mr. Davis: I think that answer lies, really, in what I have already said. Again, in its most simplistic fashion, we shall urge upon the government of Canada --

Mr. Breaugh: The government of Canada does not build cars. Come on.

Hon. Mr. Davis: -- that in their negotiations with the government of the United States a greater recognition is given to the need for -- and the economic pluses -- in having more of the work done in this province. I don’t have any other way of expressing it to the member.

Mr. Breaugh: You don’t care about losing those jobs.

Hon. Mr. Davis: It has been well stated; it has been documented; they understand it; and I think that as far as certain ministries are concerned in Ottawa they are in agreement with it.

Mr. Swart: Just speaking in generalities.

LAYOFF OF NICKEL WORKERS

Mr. Lewis: A new question of the Premier: What happened to the Falconbridge statement?

Hon. Mr. Davis: I have certain information with respect to Falconbridge that is approximately two weeks and six days old. Rather than discuss that information -- which I think is relatively public but I am not sure of that -- with members of the House, the chairman of the board and other officials of Falconbridge are meeting with ministers and officials of this government this afternoon.

I expect to be meeting with the chairman of Falconbridge myself tomorrow. I wanted to meet with him prior to any discussions on Thursday and rather than get into a discussion on information that may not be as up to date as information we will get this afternoon, I would ask the leader of the New Democratic Party to await the information that we get in those discussions so that we will he dealing on a factual basis, rather than in figures that may or may not be accurate.

Mr. Lewis: Mr. Speaker, can the Premier understand the frustration that necessarily exists among members opposite if on Thursday we are presented with another fait accompli equivalent to what occurred with Inco, without any opportunity to get some advance glimmering? Is the Premier saying that because his cabinet ministers are meeting with Falconbridge today and the Premier himself is meeting with the chairman of the board tomorrow some kind of layoff, whether all at one point in time or phased over time, is coming from Falconbridge? If so, is there some way we in the Legislature can prepare for it, perhaps by bringing Falconbridge before the select committee, as well as Inco?

Hon. Mr. Davis: I think the hon. leader of the New Democratic Party is really very familiar with the existing situation. There was an announcement made last August or September; the plant was shut down for a month, two weeks or whatever period of time, and certain figures were used in those discussions. I can’t yet give the leader of the New Democratic Party any information that is different from those figures. I don’t want in any way to mislead the House by suggesting that those figures may still be the same today because they may not be. I honestly don’t know and will not know. If the leader of the New Democratic Party feels that things might turn out to be somewhat different from the situation in September and October -- and our latest information was more recent than that, and I don’t want to prejudge the information we get -- I would be prepared to consider his suggestion. I don’t want a lot of speculation; I don’t think it helps, until we have the latest views and position of Falconbridge. We will not know that until late this afternoon or perhaps even tomorrow morning.

Mr. Foulds: Supplementary: Could the Premier tell us who sought the meetings and why they are being held specifically at this time?

[2:45]

Hon. Mr. Davis: I can’t say who sought the meetings. I can only say the meeting that is taking place this afternoon had been arranged prior to the question being raised by the member’s leader yesterday. There have been discussions. The leader of the NDP asked me some two or three weeks ago to check into the potential of Falconbridge and what might emerge, and that has been done.

I would point out to the hon. member that unfortunately -- or fortunately; who knows? -- nothing remains static. What a position may have been a month ago could change, plus or minus, today in that particular industry. I am very reluctant to get into any further discussion that could be based on information that turns out to be non-factual.

This is not a point of order, Mr. Speaker, but there was a report in the evening paper that out of the Premier’s office the figure of 1,000 had emerged. I want to assure hon. members of the House that we have had no such figure. I really don’t know where that figure came from. I just want to assure members that I have no knowledge at this moment of any figures other than those that have already been publicly discussed. They are, I think, quite familiar to the members opposite.

MASSEY-FERGUSON LAYOFFS

Mr. Lewis: A question of the Minister of Labour: Is the minister aware of the layoffs now under way at Massey-Ferguson? I believe 80 workers were given notice and more layoffs are possibly pending. Has the ministry been notified?

Hon. B. Stephenson: Yes, Mr. Speaker.

Mr. Lewis: Supplementary: May I ask the minister, were the workers involved given adequate notification under the Employment Standards Act? Does the minister have any indication of the extent of future layoffs at Massey-Ferguson? What the devil are we going to do in this province with the repetitive succession of layoffs from Sudbury to Oakville to Massey-Ferguson to Niagara-on-the-Lake? They never end and this government won’t create jobs.

Hon. Mr. Davis: Nonsense.

Hon. B. Stephenson: Mr. Speaker, it would seem to me -- to answer the second portion of the hon. leader of the third party’s question -- the thing that we must do is to create the climate in the province of Ontario which will encourage investment.

Mr. Swart: You did that 50 years ago.

Hon. B. Stephenson: I would think that the climate has to continue to be encouraged and created --

Mr. Swart: Great Depression philosophy.

Hon. B. Stephenson: -- which has been present in this province for so many years --

Mr. Warner: It would create a better climate if you resigned.

Hon. B. Stephenson: -- in which it has led the country in terms of employment, in terms of worker benefits and in terms of the kinds of remuneration which workers get.

I think we should make a strong plea that all of those who have any extra money at all -- including all pension funds, such as union pension funds -- should consider the possibility of investing those funds in Canadian-owned industries. This certainly would encourage the development of new jobs.

Mr. Deans: Where are they going to put it?

Mr. Lewis: Falconbridge? In Inco?

Mr. Warner: Hot air.

Mr. Lewis: So it goes into Indonesia?

Hon. B. Stephenson: That’s only one of the ways in which we might encourage new jobs.

In answer to the hon. leader of the third party’s first question, I would say that to my knowledge, indeed Massey-Ferguson did comply with the Employment Standards Act.

Mr. Lewis: How extensive will the layoffs be?

Hon. B. Stephenson: I will get the statute.

Mr. Peterson: Supplementary: A question on the minister’s response about the suggestion that pension funds should be going into investments here. Does the minister take that same view with the public pension plans that the province controls? Does she feel that money should be going into private enterprise as well, to encourage investment in this province, rather than spending it on government deficits?

Hon. B. Stephenson: I’m not sure that that is a reasonable sequitur to the suggestion I was making.

Mr. Sargent: No, it sure as hell isn’t.

Mr. Lewis: No more unreasonable than your nonsense.

Hon. B. Stephenson: The suggestion I was making was that each one of us --

Mr. Breithaupt: Like a government.

Hon. B. Stephenson: -- as individuals and each one of us who belongs to any kind of association with a pension plan should, I think, be interested in encouraging the development of industry in this country --

Mr. Nixon: That’s right -- help finance the government deficit.

Hon. B. Stephenson: -- not only for our future, but for the future of all of the other people --

Mr. Roy: You should talk to Darcy.

Hon. B. Stephenson: -- who are living here and for those who will come after us.

Mr. Germa: Supplementary: Is the minister not aware that some of the pressure could be alleviated if certain tradesmen could go to the tar sands? Because of the lack of a reciprocal agreement between the provinces of Ontario and Alberta, say in the case of stationary engineers, these people are precluded from taking jobs in the Alberta tar sands. Why doesn’t this province enter into reciprocal agreements so that our certificates are recognized in Alberta and vice versa?

Mr. Makarchuk: And Quebec.

Hon. B. Stephenson: It would be, I think, very easy for the trade unions involved to develop the kind of reciprocal arrangements which could facilitate this --

Mr. Deans: That is not helpful.

Hon. B. Stephenson: -- because exactly the opposite thing was happening. The obverse of that was happening not very long ago when Alberta workers who wished to come to Ontario were not admitted because the Ontario unions would not accept them. There is room for a great deal more co-operation in this country in all areas.

PIPE PRODUCTION

Mr. Kerrio: Mr. Speaker, I have a question of the Premier. Prompted by the problem that presented itself with the layoffs at Inco, I questioned the Minister of Industry and Tourism (Mr. Bennett) and the Premier regarding the manufacture of the pipe for the Alaska Highway pipeline. It has taken three weeks for the Minister of Industry and Tourism to come to the conclusion that we can make it. Now all we have left to do is sell it.

That prompts me to ask the second question. Is the Premier aware that federal funds are being considered to build a stainless steel plant in Cuba -- this question was raised by the third party last week -- and that up to date that money has been stopped because of a question raised in the federal House by the federal member for Welland, Dr. Railton? Is the Premier concerned that we might have federal funds going to Cuba to build a steel plant in direct competition with a plant in Welland, Ontario, one of the largest stainless steel producers, which, incidentally, uses quite a large nickel content in its manufacture of stainless steel? Would the first minister, when he meets with those other ministers and the first minister of Canada, make that position known, that we are gravely concerned with the climate as it exists as to retaining the jobs that we have?

An hon. member: Speech.

Mr. Kerrio: I think it’s a good one, don’t you?

Hon. Mr. Davis: Mr. Speaker, I am trying to understand the question.

Mr. Breaugh: Was it not simple enough for you, Bill?

Hon. Mr. Davis: I am not here to defend either the economic policy or the foreign policy of the government of Canada. I have never presumed to do that. I let those fellows opposite do that with some degree of regularity, like just about every day.

Mr. Mancini: Rebates on cars.

Hon. Mr. Davis: To the member for Niagara Falls’ question, “Am I concerned about the retention of jobs here in this province?” my answer is very simple, “Yes.”

Mr. S. Smith: Are you asking anything on the Cuba matter?

Hon. Mr. Davis: Not only am I concerned about their retention, I am concerned about the expansion of job opportunities in this province. If the member looks at the figures today, if he sees what in fact has been accomplished, he will see that this province, almost including Alberta now, has been more successful than any other province in Canada in the creation of new jobs, even during a rather difficult economic year.

Mr. Kerrio: Supplementary, Mr. Speaker: Would the Premier consider it reasonable to ask the assurance of the federal government to let us know in this province of Ontario when federal money might be extended to go in direct competition with corporations and businesses within the province of Ontario? Does he think that would be unreasonable?

Hon. Mr. McKeough: Find everything we are doing wrong to ask questions about. This is the third question.

Mr. Kerrio: Are you interested in jobs?

Interjections.

Mr. Kerrio: Are you really interested?

Hon. Mr. McKeough: This is Ontario, it isn’t Canada.

Mr. Kerrio: That’s right, and I am here to protect it.

Mr. Speaker: Order. Does the Premier have a response?

Hon. Mr. Davis: Mr. Speaker, after all that discussion, I am trying to hark back to the question. Does the member want me to raise with the Prime Minister of Canada the government of Canada’s foreign policy?

Mr. Kerrio: Yes.

Hon. Mr. McKeough: What nonsense. What nonsense.

Hon. Mr. Davis: I will raise with the Prime Minister of Canada those matters that are of economic concern to the people of Ontario. Yes, that I shall do.

The question of their broader foreign policy, Mr. Speaker, I really think is a matter that I am not capable of debating here in this House and is something that has to be dealt with in the nation’s capital, not here.

Mr. S. Smith: It’s never stopped you before.

Hon. Mr. Davis: We don’t employ ambassadors to Cuba. We don’t have diplomatic relations with other countries of the world.

Mr. Sargent: Maybe you need some help.

Hon. Mr. Davis: Actually that is a matter of federal responsibility; it is not ours.

An hon. member: What about the US auto pact?

An hon. member: Bert Lawrence hasn’t volunteered?

Mr. Cassidy: Mr. Speaker, can the Premier say when the province intends to have an industrial strategy, so that we have a clear lead to the development of our industry which goes beyond the ranting and the raving of the provincial Treasurer, and will prevent our simply reacting to single initiatives by the federal government?

Hon. Mr. Davis: Mr. Speaker, the very distinguished member of consumer and corporate affairs of course states the obvious answer that he has to all of our economic problems, I am sure it is a message he is taking right across the province and we won’t labour it here today. Do we have an industrial strategy --

Mr. Breaugh: No. No.

Hon. Mr. Davis: -- within the context of a provincial response? The answer to that is yes.

Mr. Martel: What is it?

Mr. Breaugh: Nonsense.

Mr. S. Smith: Wait and see.

Hon. Mr. Davis: Is there a national industrial strategy? The answer to that is no --

Mr. Mackenzie: Pass the buck.

Hon. Mr. Davis: -- and we have said so for the past seven years. I have said, as recently as my presentation of some three or four weeks ago, that one thing we need, and I have said this I guess about every three months for six years, is a national economic strategy, national economic objectives, and this hopefully is now being understood by the member’s friends in the government of Canada.

Interjections.

Hon. Mr. Davis: Hopefully, it is now being understood.

Mr. Sargent: How about plans for Ontario?

Mr. Mackenzie: How long can you pass the buck?

HYDRO LOAN PROGRAM

Mr. G. Taylor: Thank you, Mr. Speaker. A new question to the Treasurer.

An hon. member: Another set up.

Mr. G. Taylor: Since the Treasurer answers the questions from this side of the House with such exuberance and zeal --

Mr. Conway: He wants another television performance.

An hon. member: Exuberance and zeal, that’s what you cover mushrooms with. He’s paying attention now.

Mr. C. Taylor: -- is Ontario Hydro going to borrow in New York and if so, could he supply us with any facts he has at this time as to the borrowing of Ontario Hydro in the New York bond markets?

Mr. Conway: Hydro is out of control and the Treasurer knows it.

Hon. Mr. McKeough: Mr. Speaker, in reply to the member’s question, Ontario, on behalf of Ontario Hydro, registered in New York at the end of last week for a loan of $250 million which will be received in 1978. As their 1977 borrowing program has been completed for some time, this will be the first step in their 1978 borrowing program. But I am glad the member asked the question, perhaps there’s something here I just might put on the record.

An hon. member: You just happen to have the answer.

Mr. Sargent: Mr. Speaker, he’s out of order. He’s out of order. Cut him off, Mr. Speaker.

Mr. Germa: That’s an abuse of the question period.

Hon. Mr. McKeough: Mr. Speaker, in connection with the registering, it is interesting to note --

Mr. Conway: No wonder the Attorney General (Mr. McMurtry) doesn’t bother to come.

Hon. Mr. McKeough: -- that yesterday it was announced that Standard and Poor’s Corporation had given a triple-A rating --

An hon. member: I picked it right out of the air.

Hon. Mr. McKeough: -- to the bond offering of the province of Ontario.

An hon. member: That’s not an answer.

An hon. member: Tell them about your triple-As.

Hon. Mr. McKeough: Mr. Speaker, I am sure all members will share my pride --

Mr. Sargent: So you are closing hospitals.

Hon. Mr. McKeough: -- with these words, Standard and Poor’s noted that good balance has been maintained between current revenues and operating expenses, despite growth of total borrowing requirements --

Interjections.

Hon. Mr. McKeough: -- for capital programs. Public sector debt per capita is among the lowest in Canada when compared with personal income and debt service levels are similarly moderate, the rating agency said.

Mr. Mackenzie: What about jobs? What about jobs?

Interjections.

Hon. Mr. McKeough: Mr. Speaker, I am sure all members on both sides are proud of what we have achieved in this province under the leadership of the Premier.

Interjections.

Hon. Mr. McKeough: Mr. Speaker, while I am on my feet -- really it’s a point of order. I want to correct something that the Premier said.

Mr. Lewis: Mr. Speaker, he is just getting started.

Hon. Mr. McKeough: The Premier said -- the members don’t want to hear this, do they? They really don’t want to hear it --

Mr. Lewis: On a point of order? He is just getting started. For God’s sake, stop him now.

Interjections.

Mr. Speaker: What is your point of order?

Hon. Mr. McKeough: Mr. Speaker, my point of order is that I want to correct the Premier, who said we had created 100,000 new jobs in the last year.

Interjections.

Hon. Mr. McKeough: The fact is 137,000 jobs have been created in this province in one year’s time.

Mr. Speaker: Oral questions? The hon. member for Grey.

Mr. Nixon: There is no sense Roy coming back now.

Mr. Makarchuk: Your hands must be sore.

Mr. McKessock: Thank you, Mr. Speaker. I have a question --

Mr. Speaker: No supplementary to that.

Mr. McKessock: I have a question of the Minister of Energy.

Mr. Sargent: Such arrogance.

Hon. Mr. Davis: I am so modest.

Interjections.

Mr. Speaker: What has got into this House this afternoon? Do you want a half an hour recess because that is what I will give you? Now let’s have some order.

[3:00]

HYDRO RATES

Mr. McKessock: I have a question for the Minister of Energy. In view of the fact that rural users of hydro are charged considerably more per kilowatt hour than urban people, in some cases 50 per cent more, and in view of the fact that a lot of this power that is coming to the cities is travelling across farmland and rural communities by way of unwanted Hydro corridors, does the minister not feel it is time everyone pays a similar rate for hydro in Ontario the same as they do in most other provinces across Canada?

Hon. J. A. Taylor: For the information of the member, I have a concern -- I may say a very deep concern -- in connection with power costing and pricing in this province. For that reason, I referred this whole issue to the Ontario Energy Board to review. Submissions have been made and are being made to that board.

There is no doubt in my mind there are discrepancies. I do not wish to comment however until I receive that report from the Energy Board.

Mr. McKessock: Supplementary: In view of the fact that his colleague, the Minister of Transportation and Communications (Mr. Snow) looks at things in a different light to that which the Minister of Energy and Hydro do, because he cuts costs to those in the north who have added costs, such as for car licences, while the Minister of Energy is not even giving rural users of hydro equal charges but is charging them more, would this minister mind having a talk with the Minister of Transportation and Communications on policy for distribution of charges?

Hon. J. A. Taylor: I would suggest to the member there are communities in northern Ontario which are actually being subsidized in some way in terms of their hydro consumption. If he would like to pursue that matter with me further, I would be delighted. As the member knows, we also have a northern electrification program dealing with small communities. If he would like to pursue the costing and the pricing in connection with those communities, I would be delighted to pursue that as well in order to illustrate to him that it is certainly not a matter of the northern communities being discriminated against.

BRITISH AMERICAN BANK NOTE COMPANY DISPUTE

Ms. Gigantes: I have a question for the Minister of Labour concerning the dispute between the Steel Plate Examiners local and the British American Bank Note Company in Ottawa. Has the minister reviewed the report of the mediator and is she now prepared to see that the Employment Standards Act is interpreted to mean women engaged in work of similar skill or higher skill within a firm should be entitled, at the very least, to the same levels of pay as their male coworkers?

Hon. B. Stephenson: I have reviewed the report of the mediator in this case and it is obvious to me from the preliminary report that the problem is one of equal pay for work of equal value rather than equal pay for equal work. Unfortunately, we do not have any legislation in this country --

Mr. Laughren: The minister uses that when it suits her purpose.

Mr. Wildman: When is she going to introduce it?

Hon. B. Stephenson: -- to cover the concept of equal pay for work of equal value. It is being examined very carefully.

Mr. Roy: What is the minister waiting for?

Mr. Germa: Why does this government hate women?

Hon. B. Stephenson: A conference is being arranged which will be --

Mr. Lewis: Another one? There have been about 10 already.

Hon. B. Stephenson: No, we have not had 10. We have had no conferences on equal pay for work of equal value and will not until January of next year.

Mr. Lewis: Endless conferences.

Mr. Mackenzie: Government by conference.

Hon. B. Stephenson: At this time, I am happy to say there have been contacts between the mediator and both parties yesterday and today. It is my understanding that tomorrow the parties will be meeting without the mediator. I think there is some hope there may be a settlement here.

Ms. Gigantes: They are meeting all the time.

Hon. B. Stephenson: When there is a settlement, we shall be very pleased to carry out the complete investigation which is necessary in order to ensure that the very fine letter of the law is not in any way being avoided by this company.

Ms. Gigantes: Supplementary: Is the minister saying she is satisfied to see a situation where management can refuse to budge when what is being offered in terms of willingness to provide their labour by these women is a two-year program to bring them up with their high skills to the level of pay of a new male employee who sweeps floors?

Hon. B. Stephenson: That is not what I am saying.

Ms. Gigantes: What is she saying?

Mr. Cassidy: It is a blaring, blatant injustice.

DECOR METAL PRODUCTS DISPUTE

Mr. G. E. Smith: Mr. Speaker, I have a question for the Minister of Labour: What is the involvement of the minister or her staff in the strike of the employees at Decor Metal Products in Midland, which is the largest employer in the area? This strike, if it continues, will have a devastating effect on the economy in the area.

Mr. Mackenzie: Set up another commission of inquiry.

Hon. B. Stephenson: Mr. Speaker, the mediation-conciliation branch has been involved in attempting to arrange meetings between the two parties to this dispute. It is my understanding that although they have not been successful as yet, it looks as though there will be a meeting arranged within the very near future.

Mr. Speaker: The hon. Solicitor General has the answer to a question previously asked.

MISCONDUCT BY POLICE

Hon. Mr. MacBeth: Thanks, Mr. Speaker. Last Thursday, the member for York Centre asked me if I’d seen a letter circulated among a number of lawyers concerning possible misconduct by members of the York regional police force. The member inquired if I would send a representative of this ministry to a meeting which was planned to discuss the matter.

Since that time, I have received a letter from the president of the York North Law Association indicating that the meeting is to be held in private and that discussions are to be confidential. I therefore do not plan to have a ministry representative attend the meeting.

RESOURCE EQUALIZATION GRANTS

Mr. Bradley: A question for the Treasurer, Mr. Speaker: Last week I asked the Treasurer if he was prepared to convene a meeting of the mayors of those municipalities who feel they are adversely affected by the resource equalization grant from the province, and the minister replied he was not.

Mr. Swart: Why don’t you vote for equalization?

Mr. Bradley: Would the minister then be prepared to meet with these municipalities or representatives of these municipalities if they were to request such a meeting, either as a group or individually?

Hon. Mr. McKeough: Obviously, if they request it. Certainly.

Mr. Bradley: And would the minister be prepared to provide any data that they would ask to confirm their particular statistics? For instance, his ministry may have statistics that would either confirm their contentions, or suggest that their contentions were not correct.

Hon. Mr. McKeough: I think they have the data now, Mr. Speaker, but if there is something else they need, yes.

Ms. Conway: You’re a lamb to be quiet on that regard.

Mr. O’Neil: You’re no fun like that, Darc.

AUTOMOBILE PURCHASES

Ms. Bryden: I have a question for the Chairman of Management Board. About 10 days ago, I asked the Chairman of Management Board if he was planning to revise the request-to-purchase form in the manual of administration relating to the kinds of automobiles and options which the government buys for ministers and deputy ministers. He replied, “We’re always looking at items in the manual of administration.” I would like to ask the Chairman of Management Board specifically, if he is in favour of using taxpayers’ money to purchase such luxury items as AM-FM stereo radios, air conditioning, electric clocks and six-way power bucket seats, all of which are on the list of 23 options available to ministers and deputy ministers?

Mr. Riddell: Shame.

Mr. Peterson: Don’t get excited now, Jimmy.

Hon. Mr. Auld: Mr. Speaker, obviously since they’re in the manual of administration, I must be in favour of them.

Ms. Bryden: Supplementary, Mr. Speaker: Could the Chairman of Management Board inform us which of the 23 options were requested by the Minister of Industry and Tourism to bring his car purchase up to $9,749?

An hon. member: All of them.

Hon. Mr. Auld: Mr. Speaker, I think that question should be asked of the minister responsible, the minister who has the vehicle. I can find out; he can tell you a lot faster.

Mr. Breaugh: Did he get the baby loveseat option?

Mr. Breithaupt: Is he buying it?

An hon. member: Is that a reclining seat?

Mr. Roy: May I ask a supplementary?

Mr. Speaker: No, the hon. member for Wentworth North was going to ask one.

Mr. Cunningham: Mr. Speaker, I wonder if the Chairman of Management Board would indicate to us the rationale for deputy ministers who are compensated in excess of $40,000 a year having government-supplied cars?

Hon. Mr. Kerr: Forty?

Hon. W. Newman: Forty?

Hon. Mr. Davis: They’re ahead of us.

Mr. Reid: Everybody is ahead of you.

Hon. Mr. Kerr: Not in committee meetings.

Hon. Mr. Auld: Deputy ministers are entitled to a vehicle as part of the perquisites of office because they use them in their business.

Hon. Mr. Rhodes: Same as opposition leaders.

Hon. Mr. Auld: Those who use them for personal purposes pay a fixed sum -- I think it’s $55 per month --

Mr. Kerrio: Two dollars a month.

Hon. Mr. Auld: -- plus the income tax requirement -- I can’t think of the exact phrase -- where they are being supplied a company vehicle.

INDUSTRIAL MILK REGULATIONS

Mr. Wiseman: Mr. Speaker, I have a question of the Minister of Agriculture and Food. In view of the fact that many milk shippers in eastern Ontario have run out of industrial milk quota, has the minister or members of his staff been talking with Mr. Whelan, his federal counterpart, with a view to assisting those farmers? And has any consideration been given to a ceiling on the amount of industrial milk, say half a million pounds per farmer? I think that is necessary in this area --

Mr. Riddell: Tell him to read Hansard, Bill.

Mr. Wiseman: -- particularly for the farmers in eastern Ontario.

Mr. Conway: It’s a terribly deficient government policy.

Mr. Nixon: Let’s put this on Gene Whelan if we can.

Mr. Speaker: Can we have some order, please?

Hon. Mr. Rhodes: He’s trying to get into the hall of fame.

Hon. W. Newman: I could, but I won’t.

Mr. Speaker, in answer to the question from the hon. member regarding the MSQ, or industrial quota here in Ontario, it has reached very serious proportions. Many farmers have already shipped their total allocation for the dairy year, which ends March 31. I have pointed out that we have farmers in the province who have milk to ship and plants which want it but we don’t have any quota to give them. What I’m doing right now is having an in-depth cost-benefit analysis done of the total provincial milk situation as far as industrial milk is concerned.

I have not talked to Mr. Whelan specifically about upper limits, but I have told him how to solve the problem as far as this province is concerned. I think it will be very unpalatable for him, but I did make it very clear to him last Tuesday night how to solve our problem.

Mr. Speaker: The hon. member for Grey.

Mr. Nixon: Was that the OMA? I heard you did very well there.

Mr. McKessock: A supplementary: The minister has said that he has told Mr. Whelan how to correct the situation in Ontario. Would he mind providing that information to the House?

Hon. W. Newman: Certainly, Mr. Speaker. In Ontario we have processors who do not have enough milk at this point in time to supply the demands or the market they have for their commodities. They are bringing in milk from other areas; and that is happening not only in eastern Ontario but throughout the whole province. What I’m saying, in effect, is that we should be allowed more MSQ or more industrial base for this province so we can meet the demands of the consumers and the processors of this province.

ELECTRONIC INFORMATION

Mr. Conway: My question is of the Minister of Government Services. Since his ministry seems to have general supervisory control over the electronic data processing facilities available to the government of Ontario in general, would the minister care to share with this House what, if any, precautions or guidelines there are with respect to protecting the security of the information stored within any particular part of that system?

Hon. Mr. McCague: Mr. Speaker, I couldn’t give the member a complete answer to that, so I will get it for him.

Mr. Conway: A supplementary: In preparation of the minister’s answer, I wonder whether or not he might look to see whether, prior to recent developments, there has ever been any provision whereby people who are very closely involved with the most sensitive part of that system are required to undergo any security check? Could he investigate that as well?

Hon. Mr. McCague: Maybe the member would tell me how one gives a person a security check, Mr. Speaker?

Mr. Speaker: The minister said he was going to take it as notice. The hon. member for Hamilton Mountain.

Mr. Sargent: I have a supplementary question on this.

Mr. Speaker: No.

Mr. Sargent: Why not?

Mr. Speaker: I think there have been enough supplementaries, that’s why not.

EMBASSY MANAGEMENT CONTRACT

Mr. Charlton: I have a question of the Minister of Government Services with respect to a matter which I raised with him in the estimates of his ministry regarding Embassy Management Limited of Brampton.

If I were to provide him with details of two executions against Embassy Management Limited in 1977, both involving suits brought against them by subcontractors for nonpayment for work performed on two separate government contracts, will the minister take this as, and I quote his deputy minister, “evidence of Embassy’s bad payment record”; so that his ministry, and I quote the deputy minister again, “may be able to take some action”? And will the minister give us a guarantee that this action comes in the form of no further contracts being awarded to Embassy Management Limited of Brampton by his ministry?

Hon. Mr. McCague: Mr. Speaker, there are an awful lot of questions in one there. We are aware of the problems with Embassy Management

Mr. Kerrio: Take them one at a time.

Hon. Mr. McCague: We do not, in the opinion of the officials of my ministry, now have the right to deny a contract to Embassy.

Mr. Martel: Kick them in the head then.

Mr. Laughren: Say no.

Hon. Mr. Kerr: How do they get out of debt without working?

[3:15]

Hon. Mr. McCague: I would be pleased to have the information the member has. I will examine it and get an answer to him but I would say that --

Mr. Warner: Wishy-washy.

Hon. Mr. McCague: It is not wishy-washy at all. Legally we can’t deny him a contract and the member knows it.

Mr. Warner: You have been here too long, you should resign.

Mr. Speaker: Do you have a supplementary?

Mr. Charlton: I will get the minister copies of those executions. Given the fact that the information has been brought to the attention of the minister and the deputy minister by Mr. Dave Haggard, proprietor of H Construction; Mr. Paul Little, representative of John Wheelwright Construction; Mr. Lionel Knight of Knight’s Construction; Mr. Lawrence Desrochier from Desrochier’s Roofing; and Celeste Como of Como and Calabro Excavating, at a meeting in the deputy minister’s office on October 21, 1977, at which time the name of several other subcontractors were given who are in the same boat, would it not now behove the minister to request his colleague the Minister of Consumer and Commercial Relations (Mr. Grossman) to launch a full scale investigation under the Business Practices Act into the manner in which Embassy Management Limited of Brampton and its sister company, Lamco Services Company, have been carrying on business?

Mr. Warner: Maybe you can solve this one; you blew beer in the ball parks.

Mr. Martel: Come on, answer the question, George.

Mr. Warner: No answer.

Mr. McClellan: Let the record show no answer.

MARKING STANDARDS

Mr. Reid: I have a question for the Minister of Education: Has the minister read the article in the Globe and Mail this morning regarding the marking standards in the province of Ontario; and doesn’t he think that it’s time the Ministry of Education brought back some kind of standard in marking across the province so that students particularly, but also teachers, in the various educational institutions, would have a bench-mark to which they can relate the marks of all students?

Hon. Mr. Wells: Mr. Speaker, I glanced just quickly at the article --

Mr. Conway: Just glanced?

Hon. Mr. Wells: -- and I haven’t had an opportunity, as I have been in a meeting all morning, to read it in detail. But let me say this:

First of all, what I saw indicated that our ministry had no records on what marks in fact were given in the various schools. That of course is not so. We know the marks that were given to every student in every subject in every school, and we do have comparative figures that we can lay our hands on.

Second, we did do a very elaborate interface study, as my friend knows, and it was made available to everyone a year ago when this subject was approached very thoroughly. In fact the conclusions in the interface study were rather different from the general conclusions that someone like the writer makes quickly, without having the benefit of all the research the people who did the interface study had.

Mr. Reid: That is not in fact so.

Hon. Mr. Wells: The actual facts the interface study brought out were that the difference in marks between schools was not as great as some people imagined --

Mr. Reid: It varied; 13 and 20 per cent.

Hon. Mr. Wells: -- and the second conclusion was that the marks given today by teachers in the secondary schools are probably just as good an indicator, and can be used in that manner, of success or failure in university, as the grade 13 exam marks were.

The only place where you get into some particular problem is in those courses where there is very fierce competition for admission. It may be in those courses there is some chance students may have a little tougher time depending on the school they come from.

The hon. member asked what have we done about it? Ever since that interface report was brought out, we have had various committees looking at it. We are coming forward with some recommendations that will help in this matter.

A year ago, I put to all the secondary school headmasters of this province the very premise that is outlined in that article today: “Is there a problem? Is there a difference between grade 13 marks in this province? If so, you are the people who should be most concerned about doing something about it; what do you recommend?” I am waiting for them to bring back some recommendation.

Mr. Reid: Supplementary, if I may, Mr. Speaker: In view of the fact that some university professors have said some of their students are almost functionally illiterate; would the minister consider something that I think was tried in the state of Florida, called a “lifestyles program” or test, in all the high schools in the province, to measure whether the students in fact can reach, or have attained a certain level of maturity in their educational process in lifestyles, such as the Florida experiment sought to establish?

Hon. Mr. Wells: I suggest to my friend that he look a little further and little more closely into the Florida experiment to decide whether he thinks --

Mr. Reid: I will do it in January.

Hon. Mr. Wells: -- that the kind of program they have introduced may mean that a third to nearly a half of the students will be denied their secondary school graduation, and that the groups of students who will be denied will be from the very areas that should be given help, rather than some kind of barrier set in front of them which will probably prevent them from getting full employment.

Mr. S. Smith: A phoney graduation certificate doesn’t help, you know.

Hon. Mr. Wells: Secondly, I know we hear from these so-called academics in universities all the time, but I get a little sick and tired listening to them talk.

Mr. Lewis: Hear, hear, absolutely.

Hon. Mr. Wells: This professor writes about the differences in marks in the various secondary schools in this province. What about the differences in marks between the University of Western Ontario and Brock University? Or Queen’s University?

Mr. Reid: Well, that doesn’t make it right.

Hon. Mr. Wells: I am not saying that it makes it right, I am just saying that perhaps there is nothing wrong with having the situation the way it is.

Mr. Lewis: Those university tests are bogus and stupid. They tell nothing; they’re utterly ridiculous.

CONSERVATION OF NIAGARA FOOD LAND

Mr. Swart: A question of the Minister of Agriculture and Food, if I may: In view of the minister’s sometimes expressed desire to save the prime food land, and because the Niagara regional council is soon to decide on the location of its new headquarters, has the minister advised the council of the region of Niagara to locate such headquarters well away from the fruit and grape land?

Hon. W. Newman: I had the occasion and the privilege to meet with some people from the Niagara regional council to discuss many matters -- I believe it was only yesterday.

Mr. Swart: May I inform the minister that the location has been narrowed down to three sites, all of them in communities on unique food lands; that the region of Niagara has 1,900 employees; and that this will create tremendous pressures on the surrounding food lands. Will the minister interest himself in the matter and prevent more of Niagara’s best land from being taken up through this measure?

Hon. W. Newman: I think a decision was made on the location of the regional headquarters some time ago. The Minister of Housing (Mr. Rhodes) and I were both involved in that. Those decisions were made regarding the preservation of the unique, tender fruit lands of the Niagara Peninsula.

Hon. Mr. Welch: What’s wrong with downtown St. Catharines?

ORGANIZED CRIME

Mr. Stung: A question of the Solicitor General, concerning organized crime: During his estimates in the House the minister undertook to obtain certain figures, and I ask him whether he is now able to provide us with statistics which would indicate how many investigations have been thwarted or have arrived at an impasse; and how many charges have been dismissed by our courts as a result of witnesses failing to co-operate or testify, whether because of fear of retaliation or other intimidation?

Hon. Mr. MacBeth: I thought that I had met most of the obligations that I made at that time. Obviously, this is one that I haven’t met, and I don’t think we are following up. I will undertake to follow it up and get that information if it is available.

ROSS SHOULDICE

Mr. Martel: A question of the Premier: Has the Premier had an opportunity to determine what the Minister of Consumer and Commercial Relations (Mr. Grossman) is going to do with respect to one Ross Shouldice in the Sudbury area, seeing that he is now operating again without a licence? Is it the Premier’s intention to reconvene the Horowitz inquiry to look into the conduct, both in the past and at the present, with respect to our friend Ross Shouldice?

Mr. Nixon: That’s Stravinsky’s buddy.

Hon. Mr. Davis: I just had a brief message from the responsible minister, who tells me we will have some information, probably, by Friday of this week.

CANADA PENSION PLAN

Mr. Peterson: A question of the Treasurer: In view of the tabling of the Auditor General of Canada’s report with respect to the Canada Pension Plan, and the fact that he sees bankruptcy without an increase in contributions, has the government of the province of Ontario taken a position; and what is the Treasurer’s view on that particular suggestion of the Auditor General?

Hon. Mr. McKeough: My views have not changed since the estimates when the member asked the same question.

Mr. Peterson: Supplementary: Does that mean the minister is going to continue to borrow at present rates until there is nothing left? Is that what his plan is?

Hon. Mr. McKeough: We discussed this at some length during the estimates. I recognize that members opposite have difficulty trying to fill up this hour, but if the member wants me to give him the same lecture in economics I gave during my estimates, I’ll be glad to do so.

Mr. Makarchuk: Professor McKeough is holding class.

Mr. S. Smith: Go right ahead.

Hon. Mr. McKeough: You really have trouble don’t you?

Mr. Speaker: The hon. member for Bellwoods, with a final question.

Mr. McClellan: Thank you, Mr. Speaker.

Mr. Roy: On a point of order, I just point out that the Treasurer goes on a frolic of his own during the question period. I think the same rules should apply to him as to us.

Hon. Mr. Davis: The hon. member for Ottawa East shouldn’t use that legal terminology. We don’t understand.

Mr. Speaker: The question period has expired.

Mr. S. Smith: The arrogance of your government will be your undoing, and you know it.

OMBUDSMAN ESTIMATES

Mr. Wildman: In view of the comments made in general government committee during the study of estimates of the Ombudsman; the announcement this morning that the Ombudsman has shelved plans for a northern regional office; and his statements during the estimates that the north would not be used as a scapegoat in his quest for further funds; can we do something here to find out what exactly is happening with the Ombudsman?

Mr. Speaker: Well, you can’t do it on a point of privilege.

Mr. Wildman: Can you give me some direction, Mr. Speaker?

Mr. Speaker: You can take it to the select committee on the Ombudsman.

EMBASSY MANAGEMENT CONTRACT

Mr. Charlton: Mr. Speaker, I wish to give notice I am unsatisfied with the answers I received this afternoon from the Minister of Government Services and wish to give notice I would like to debate the issue at 10:30 this evening.

Mr. Breithaupt: Dissatisfied.

Mr. Speaker: Pursuant to standing order 28, the hon. member for Hamilton Mountain and the hon. member for Port Arthur have indicated they are not satisfied with questions; they will be debated at 10:30 this evening.

Mr. Foulds: The questions were good, Mr. Speaker, but the answers were insufficient.

Mr. Sargent: In fact, we are not satisfied with the government.

INTRODUCTION OF BILLS

LICENSING OF BUSINESSES BY MUNICIPALITIES ACT

Hon. Mr. McKeough moved first reading of Bill 119, An Act to provide for the licensing of Businesses by Municipalities.

Motion agreed to.

ANSWER TO WRITTEN QUESTION

Hon. Mr. Welch: Mr. Speaker, before the orders of the day, I wish to table the answer to question 47 standing on the notice paper.

ORDERS OF THE DAY

FARM PRODUCTS MARKETING AMENDMENT ACT

Hon. W. Newman moved second reading of Bill 102, An Act to amend the Farm Products Marketing Act.

Mr. Speaker: Does the hon. minister have a statement?

Hon. W. Newman: Yes, I do.

Mr. Foulds: It will be the first time.

Mr. Conway: You are going to Ottawa to talk to Gene.

Hon. W. Newman: Mr. Speaker, most of the amendments I am proposing to the Farm Products Marketing Act and the Milk Act are in recognition of changing marketing practices. The simple assumption that marketing means that a sale takes place no longer covers many situations.

Section 1 of both bills defines marketing to include the various ways in which goods pass from one party to another. Marketing in this modern age is a complex chain of events. A product can flow through a wide variety of channels to reach the consumer. We believe that marketing should be regarded as a process which moves the product from the farm to the consumer.

[3:30]

Many of the modern means of marketing do not involve what we traditionally think of as a sale, but the end result is the same. Therefore, marketing has been redefined to include processing as well as financing, advertising, storing, et cetera, which were included in the Act previously.

Sections 2 and 3 of the farm products bill deal with inspection and augment existing provisions to allow inspectors to measure the premises on which a regulated product is produced. This relates to the equitable determination of licensing fees.

Changing marketing methods are the subject of section 4, in which it is proposed to allow boards which now operate on marketing quotas to bring their products under production quotas. I should point out that this applies only to the Burley tobacco board, chicken boards and turkey boards. This provision is designed to take account of situations where a processor gets into primary production.

It has been argued successfully in the courts that a processor who produces the primary product but sells only the processed products is not “marketing,” and so is exempt from the marketing quotas. This kind of operation is known as vertical integration. We in the government do not believe it is in the best interest of either the farmer or the consumer of this province to have our food production industry controlled by a few very large corporations.

I may say that in any future quota plans we intend to use the production quota method rather than the marketing quota method. However, no product will be brought under a quota system unless the producers express a favourable opinion, and for the foreseeable future we do not anticipate any more quota plans.

Selling his product is not the only way a producer can earn income. He may also rent his land to a processor to produce that product. Section 4, therefore, also authorizes those local boards that negotiate price to negotiate the rental to be paid by the processor to a landowner if the product to be produced is a regulated one. Negotiations are carried out by negotiating agencies with equal representation from processors and producers. They would determine the price and, under this provision, the rental rate. The rent so determined would be the minimum figure. An owner would be free to charge more if he could get it.

Section 5 also deals with marketing. It enlarges the situations under which a sale of a regulated product is deemed to have taken place. It covers situations where, for example, a product is produced and processed or marketed by the same person. In this case, the person as producer is deemed to have sold the product to himself as a processor or marketer, and is therefore subject to the marketing regulations. The same applies to a producer who has his product custom-processed, then sells it himself as processed goods.

This section also covers situations where a company or co-operative in which the producer holds an interest or is a member has some outside organization process or market the product on its behalf. The provisions dealing with companies and cooperatives are proposed for the Milk Act as well.

Most of the amendments proposed for the Farm Products Marketing Act are already included in the Milk Act, a fact which was noted by a judge who heard a case brought under the Farm Products Marketing Act. The judge stated that if the farm products Act had included sections similar to the Milk Act, his decision might have been affected. The Milk Act provisions, by the way, have already stood up in many court cases.

I have received many representations from farm organizations asking me to bring forward amendments similar to the ones proposed in these bills. Investigations carried out by my staff as well as by farm organizations show that disastrous effects might be expected to many of our marketing plans if these amendments are not passed.

Supply management was introduced for certain products to avoid exaggerated fluctuations in supply and the consequent fluctuations in producers’ incomes. In very simple words, supply management is intended to stabilize a farmer’s income in an era of constantly rising costs so that our farmers can keen using our land productively. Violent swings in prices lead only to discouragement, and in some cases bankruptcy for our farmers.

I trust the hon. members will support these bills, which are vital to the health of the agricultural industry in the province of Ontario.

Mr. Riddell: Mr. Speaker, my remarks are going to be somewhat lengthy on this particular bill; and I do not make any apologies for that because I would like, in my discussion and debate, to correct some of the wrong impressions that consumers have about marketing boards. I think we must understand here at the beginning that it is the consumers’ associations that are objecting rather strongly to some of the amendments in this bill

The amendments to the Farm Products Marketing Act are most essential if Ontario’s farmer-run marketing boards are to remain in business.

You no doubt know, Mr. Speaker, that organized marketing by means of marketing boards have been developed over the past 40 years. At the present time the Ontario Farm Products Marketing Board, which administers the Farm Products Marketing Act, oversees 21 active marketing boards involved in selling 60 per cent of Ontario-produced food, amounting to approximately $1.6 billion.

These boards could be ruined if businesses choose to exploit a loophole opened by a recent Ontario Supreme Court decision. The potential loophole was created recently when the court ruled that the Eastern Ontario Vegetable Grower’s Co-operative of Trenton is owned by farmers and therefore does not need to comply with marketing board rules, including minimum prices processors must pay corn and pea growers.

The fear is that this loophole could be expanded to cover any commodity farmers market through a board, destroying the effectiveness of price, production and marketing controls. Marketing boards hold varying degrees of power over farm commodities and function in much the same way as unions for workers. A few boards have been granted enough power to limit production and set prices. If the boards are broken, I would have to think farming will be set back 40 years and there is the danger that the farming industry will be largely controlled by large companies. In which case, farmers will assume the risks of lower prices and surplus production.

If the loophole opened by a recent Ontario Supreme Court decision in the case of the Farm Products Marketing Board versus Eastern Ontario Vegetable Grower’s Cooperative, and the decision of the divisional court of the Supreme Court of Ontario in the case of Campbell Soup Company versus Farm Products Marketing Board, is not closed, then Ontario’s food industry could fall into the hands of a few large corporations.

The ruling of the Supreme Court would allow some groups to bypass the price setting and production control powers of many of Ontario’s farm products marketing boards. If that happens, farm marketing will be thrown into chaos and many of Ontario’s existing family farmers could be driven out of business.

The Ontario Farm Products Marketing Act requires farmers who raise chickens, turkeys and some other products, to sell their products at a price set by the marketing boards. The farmer must also have quota issued in order to produce or sell his products. The Supreme Court ruling in the case of the Eastern Ontario Vegetable Grower’s Co-operative in Trenton allows the co-operative to get around the regulations. The co-operative sells vegetables already processed, thus allowing it to bypass the provincial Act which only covers the sale of raw products. Since farmers own part of the co-operative, they don’t actually sell the raw product to anybody but are able to skirt the regulations.

The poultry industry has had a similar problem, since Campbell’s Soup Limited won a court case earlier this year. The ruling said that Campbell’s Soups Limited is selling chicken dinners, not raising chickens at its farms, and therefore falls outside the scope of the Chicken Marketing Board. Campbell’s Soups is both a producer and processor of chicken, and are therefore able to circumvent the Act as they are not selling a regulated product as specified in the Act.

The concern is not about the Campbell company but about the larger operation, for example a large fried chicken chain might exploit the same loophole. As a matter of fact, the loophole could be expanded to cover any commodity farmers market through a board, destroying the effectiveness of price, production and marketing control. There have already been indications that processors in commodities other than the ones involved in the court cases will exploit the loophole.

In general terms, the loophole works by making farmers financial partners in the final product that is sold, integrating the business from the farm through the wholesales system. In law, the amalgamated farmer/processor system is selling a processed product. The Ontario Farm Products Marketing Act deals with raw products sold by farmers, not finished and processed foods, so amalgamated organizations escape the marketing board’s price, production and marketing controls.

I think it might be of interest at this time to give a brief history of the events which led to a court case between the Farm Products Marketing Board and the Eastern Ontario Vegetable Growers Co-operative. As I indicated previously, the amendments to this Act have been made necessary by the decision of the Supreme Court.

Several years ago, a processing company controlled by a prominent Trenton area man by the name of Eban James -- and I might just mention at this time, Mr. Speaker, that this same man, Eban James, I understand, was the bagman for the Tory party --

Hon. W. Newman: I heard the opposite.

Mr. Riddell: No, no -- and the reason, probably, that the minister was somewhat reluctant to bring in amendments to this bill when they should have come in.

Hon. W. Newman: That’s not so; check it for yourself.

Mr. Riddell: This man, Eban James, built a new plant with substantial backing from both the federal and provincial governments in the form of forgivable loans for economically backward regions. This company, called Produce Processors Limited, as a processing company freezes and stores both sweet corn and peas on a custom basis. The plant was built about six years ago by a group of people in eastern Ontario who were concerned about the fact that the processors were rapidly abandoning eastern Ontario.

As I indicated, there were several hundreds of thousands of dollars invested in the plant that came from the government under the ARDA program. It was built on the strength of the UK market when Canada had a preferential tariff over other countries exporting sweet corn to the United Kingdom. The Ontario Vegetable Producers Marketing Board was able to negotiate steeply higher prices for corn and peas in the mid-1970s in the wake of rising grain corn and soya bean prices. Had processors not paid those higher prices in southwestern Ontario, farmers would have stopped growing sweet corn and peas.

At the same time, competition for overseas markets stiffened, particularly for corn in England. The competition came from Israel and North Africa. The new processing plant needed as much volume as it could get to lower per-unit costs. Farmers in the area wanted to grow more sweet corn, even if prices had to be lowered to find a market. That led to a dispute with the marketing board.

The upshot was that farmers formed a co-operative to process and sell their own corn. The Eastern Ontario Vegetable Growers Co-operative Incorporated, as it was called, is the buyer of the raw product and the seller of the finished product. It pays a fee to produce processors to have the raw product processed and stored. It is also responsible for paying the growers for the raw product.

Prior to the spring of 1976, a person by the name of Bill Oosterink who was the owner of OMAR Farm Produce Limited, used to fulfil the role that the co-operative now plays. Following the 1976 negotiations, the British pound weakened severely, shipping rates increased, the raw product prices of sweet corn increased; Canada lost its preferential position with the United Kingdom and Israel gained an advantaged, duty-free position with the European Economic Community. All of the factors combined to convince OMAR to get out. This left the growers in the tough position of no potential contracting concerns interested in their corn. Eban James, who holds 80 per cent of the shares in Produce Processors, was not anxious to have the plant cease operations. First of all, this would cause Eban James and Produce Processors to relinquish their ARDA funding, and the plant would probably have to be sold at distress prices to a western Ontario giant.

The obvious question at this point is: Why didn’t Produce Processors contract directly with the producers like any other processor? This question has been asked several times by the Ontario Vegetable Growers Marketing Board. The pat answer was that under the terms of the ARDA funding, it was not allowed. The Farm Products Marketing Board tried to verify this statement with senior officials and they were told that it simply was not true. The real reason for not contracting directly is directly related to the ARDA loan. If Produce Processors were contracting directly, it would have to abide by the marketing agreement or it could lose funding from ARDA in the event that the marketing board laid charges.

[3:45]

Under the present system, produce processors are under no obligations whatsoever. Eban James, with his great white father image, is able to set whatever fee for processing he wishes and reverts all the risk of growing the crop and selling the finished product to the producers who are members of the co-operative. I would hope that a copy of my remarks would get back to the eastern Ontario producers, because I really think that they are being taken in. After they read what I have to say, they might think twice about Eban James and his great processing outlet.

Mr. Reed: Is he related to Jesse?

Mr. Riddell: The system has worked quite well for Eban James. Producers only got paid 60 per cent of the negotiated price last year. Produce Processors Limited showed a profit for the first time in its history. You can imagine what the processing fee must be if all the overhead for a $5-million plant was covered on the put-through of one crop. The situation may be better in 1977 since both peas and corn were processed.

The marketing situation of the co-operative is almost as immoral as the custom processing arrangement. The co-operative is forced to rely on one broker in the United Kingdom market. This is Mr. Don Bartlett of Barwell Foods Limited out of Montreal, an export and import trading house. He is a world trader who scouts out several prices for all the vegetables he handles, including sweet corn. He also engages in price competition on various world markets, but the United Kingdom sweet corn market is by far his largest.

As you can see, he is in the position of telling his customers where he can get the product cheaper and what he will pay for the corn based on the market conditions. It is a take-it-or-leave-it proposition from their point of view. Therefore, in essence, it is as close to a consignment selling arrangement as you can come. It was learned that Bartlett was selling top quality Canadian corn from the Eastern Ontario Vegetable Growers Cooperative in low quality markets. This is an absolutely ridiculous situation and would be impossible if he were not in a monopsony situation. This matter has been pointed out several times to the members of the co-op. It was suggested that they would be better served if they hired their own salesman in the United Kingdom, someone responsible only to them.

The members of the co-op referred to the chairman, Mr. Bob Petty, as their salesman. First of all, Mr. Petty had no export sales experience. He is not present in the market and Bartlett is still handling all the corn on a commission basis. As you can see from all of this, the growers are caught in the middle between Eban James and Don Bartlett, and as a result are not being paid the negotiated price while everyone else around them is making money.

The glaring question which now appears is why do growers in eastern Ontario apparently support this system or conceal their objections as to what is happening? There are several reasons for this situation.

First, the producers have been reassured all along, ever since meetings last spring with the co-op executive, that the co-op is not out to break the law. They claim they are vertical integrators, just like York Farms. The glaring difference between what they are doing and what a true vertical integrator does is in the matter of risk and where it lies. York Farms, for instance, is a situation where the company absorbs all the risk of growing, processing and marketing the crop. In the co-operative situation, the individual grower has all the risk while the processing company and the marketing agent are assured of at least expenses plus a profit.

Second, the producers, to the best of my knowledge, have never been told that they will not be paid in full for their corn. They were told there may be some rough times, but whenever there is money available they will be paid what is available. This has worked for a year, but as recent as the Northumberland county meeting in November, producers have been questioning why they have not been paid when everyone else is being paid.

Third, and the most important reason, is the feeling that they have no other choice if they wish to continue growing sweet corn. This is a reason which we, as elected people in the Legislature, and the Vegetable Growers Marketing Board, must all take responsibility for.

In fact the Ontario Vegetable Growers Marketing Board has made a definite commitment to the eastern Ontario growers. On November 9, the Minister of Agriculture and Food met with representatives of the co-op, the processing industry and the vegetable board. At the outset, the minister made it clear that the Act would be amended. He also made it clear that he wanted the eastern Ontario growers to be accommodated and that he wanted sweet corn exports from Ontario to continue. The vegetable board publicly committed itself to attempt to accommodate sweet corn exports.

A committee made up of participants was struck by the minister; members of the committee are Dr. G. Collin, chairman of the Farm Products Marketing Board; Mr. Cecil Farrow, vice-president of the Green Giant of Canada Limited, Mr. Hank Vander Pol, chairman of the Ontario Vegetable Growers Marketing Board; and none other than Mr. Eban James, majority stockholder of Produce Processors and the largest contract grower for the Eastern Ontario Vegetable Growers Co-operative.

Fourth, the growers of the co-operative are not fully informed of the situation. The co-operative has had only one general meeting with its growers since its beginning. There was another meeting scheduled for November. The telex which the co-op recently sent the cabinet ministers saying they would be put out of business by the new legislation was not read to the growers before the 91 signatures went on the petition. In fact some growers were not even notified that there was any kind of a telex being sent.

No one, including the Minister of Consumer and Commercial Relations, has seen an audited statement of the co-operative financial affairs. The chairman of the cooperative, in a closed meeting, admitted to the chairman of the Farm Products Marketing Board and the chairman of the Ontario Vegetable Growers Marketing Board that the co-operative was a paper front for produce processors. Growers were not informed of this because it was raised at the November county meeting and Mr. James categorically denied the statement.

Mr. Petty, the chairman of the co-operative, was not present at the county meeting. It is my understanding that this bill will be sent to a standing committee. Having talked on many occasions to the director on the Ontario Vegetable Growers Marketing Board from the riding which I represent, I can anticipate some of the information that will come forth at that committee meeting. A spokesman for the Eastern Ontario Vegetable Growers Co-operative, and I trust that will be Eban James, will say that the Minister of Agriculture and Food and the vegetable board sanctioned, the illegal operation of the co-operative at a price of $45 a ton for sweet corn in 1976 instead of the negotiated price of $61.25.

What actually happened is that the minister stated that the ministry would help in whatever way it could to set up a properly run co-operative. I am kind of letting you off the hook here, Bill, I hope you are listening. As it turned out, Mr. O’Mara of the ministry drew up their charter along normal lines. At no time did anyone suggest that they could purchase sweet corn at below the negotiated price.

I am sure that the committee will also hear the statement that the marketing board is western Ontario oriented, has done nothing to stop vertical integration and has done nothing to prevent processors from leaving eastern Ontario. I might just draw to your attention that eastern Ontario is represented on the marketing board on the same basis as any other part of the province. The directors do not condone the operations of the co-operative and are in fact attempting, as the marketing board is, to correct the situation in favour of the eastern Ontario producer.

At last year’s annual convention of the Ontario Vegetable Growers Marketing Board, producers from all across the province ratified the establishment of an export development fund to promote the export of frozen sweet corn. When the Ontario Vegetable Growers Marketing Board met with the eastern Ontario co-operative, they rejected the proposal on the basis that they would still have to pay the negotiated price to be eligible for a subsidy from the fund.

I am sure we will also hear that the marketing board price is set too high and will not allow the eastern Ontario co-operative to compete. The marketing board does not set any prices. They are negotiated. At the county meetings, prior to the 1976 and 1977 negotiations, the eastern Ontario producers presented resolutions requesting an increase in the price of sweet corn. As it turned out, in the 1977 negotiations the industry agreed to drop the price from $61.25 to $56.75 per ton because of market conditions.

The eastern Ontario co-operative will also claim that the Crop Insurance Commission is discriminating against them. I am sure that the co-operative has met with the Crop Insurance Commission; and Henry Ediger, general manager of the Crop Insurance Commission of Ontario, has met with the eastern Ontario co-operative. It was made very clear to the co-operative exactly what the situation is. The Crop Insurance Commission does not wish to become a market for the sweet corn produced by the members of the co-operative. The co-operative has failed to take the necessary steps of proving financial responsibility and convincing the commission otherwise.

I should not speak for the Crop Insurance Commission, but I am sure Mr. Ediger will verify the reason for not insuring the growers. By not adhering to the marketing board regulations, producers are unable to get crop insurance. This was particularly serious this year, because 700 acres of corn were bypassed by the co-operative. The Ontario Vegetable Growers Marketing Board’s concern in this matter is that the producers not be monopolized any further; but unless there is an alternative presented, it will likely continue for another year at least.

The alternative is in the formulation stages under the committee which the minister has set up. This has to work, or both the marketing board and the co-operative will have an uncertain future.

I have spent some time outlining this case, for I think it is important that the members of this Legislature recognize the vulnerability of farmers in joint ventures with companies looking for ways to bypass any market-board rules or regulations. This vulnerability is exemplified by the fact that the eastern Ontario co-operative paid its farmers $32 a ton for corn, and settled with a final payment of $5 a ton when the crop was sold.

The contract price as negotiated by the Ontario Vegetable Growers Marketing Board was $61.25 a ton. The cost of producing a ton of corn is estimated to be $42 a ton. So not only would the eastern Ontario producers not meet their cost of production with the payment made by the co-op, they would be short-changed by an amount of $24 a ton.

It is my understanding that the eastern Ontario producers have not received the payment for this year’s crop, which is further indication of the farmers’ vulnerability in such a risk-sharing venture. The farmers have no financial security. A venture of this nature simply amounts to consignment production, with the farmer paid whatever can be made by producing, processing and selling a crop.

The processing companies, which now rent land and pay help to produce crops, would be tempted to follow the lead of the eastern Ontario co-operative and try to shift the financial risk to individual farmers. There is also the danger that the system could be applied for any other commodity and undermine the pricing, production, quality and other controls farmer-run marketing boards have developed over the past 40 years.

The system could even be applied to innocuous boards such as pork. A packing company, for example, could make a joint deal with a farmer to market bacon and ham, and they could jointly go into unlimited production at an integrated price and market their hogs and pork completely outside of the Ontario Pork Producers Marketing Board teletype system.

The Pork Producers Marketing Board is unlike the Vegetable Growers Marketing Board in that it does not negotiate price. However, for those boards that do negotiate price, the Farm Products Marketing Board requires, under the terms of the Farm Products Marketing Act, that payment of a negotiated price to producers by processors does not apply to vertically-integrated producers. Vertically-integrated producers are those who both produce and process crops grown on their own or leased lands, such as York Farms or Canada Packers. They own or lease land, produce vegetables with hired labour and subsequently process the vegetables.

It is obvious that there are a number of solutions to the problem. First, the Ontario Vegetable Growers Marketing Board could be designated as an agency board. This would require that a producer first sell his crops to the board which would in turn sell it to processors. There are presently seven agency boards in Ontario -- apple, asparagus, beans, eggs, greenhouse vegetables, tender fruit and wheat.

[4:00]

Secondly, production controls could be imposed; marketing plans would have to be changed, producers would be told how much they can grow. This, in many segments of the farming industry, is not an acceptable route.

Thirdly, amendments could be made to the Farm Products Marketing Act. Through definition, the amendments to the Act would require that vertically-integrated companies not be exempt from marketing plans. The Ontario Milk Marketing Board has this requirement in effect now under the terms of the Milk Act.

It is also important to note that the problem requires both an economic solution as well as the legal solution. The processors in eastern Ontario were established to meet the export market. Presently, because of the minimum negotiated prices that must be paid by the processors, they’re finding it increasingly difficult to compete on the export market.

Possible solutions are; firstly, the negotiation of a two-price system -- one for the export market and one for the domestic market. It would be negotiated through the present marketing board system. A pool would be established which would be contributed to by all the producers of a certain commodity. Money would go from this pool to those processors who are contributing to the export market so that producer prices for both markets would be more evenly distributed.

The Vegetable Growers Marketing Board has already agreed to pursue this alternative.

A second solution would be a government subsidy for producers supplying the export market. This, I must say, is an unpopular solution and may lead to more problems than it solves.

I’m sure the minister considered all possible solutions to the problems and accordingly both the Farm Products Marketing Act and the Milk Act to plug the loopholes which became apparent after two companies were successful in circumventing the Act.

In my earlier remarks I made references to the leasing of land, and although this could have been another way around the Act, the minister has very wisely introduced an amendment which would prohibit processors from operating outside of the pricing aspect of the plan by leasing land for a very nominal fee. If this amendment was not introduced, a processing company could lease land for, let’s say $1 an acre, grow a crop, process it and sell the finished product, in which case a deemed sale of a regulated product does not enter the picture. Prices do not apply on internal transactions and for this reason an amendment to include leasing in price negotiations was introduced.

The amendment empowers negotiating agencies to negotiate rent for land rented for the production of a regulated product. To bring vertical integrators under the terms of the Act an amendment was introduced to add provisions which deemed the sale to have taken place where a producer operates in two capacities, by producing and processing, or producing and marketing, regardless of whether his processing and marketing operations are carried out by himself or through the agency of another.

The definition of marketing has been changed to bring it more in line with the current marketing theory, which includes the entire process of moving a product from the farm gates to the consumer. Marketing under the present Act places too much emphasis on buying and selling, and all the other things such as advertising, assembling, financing, packing, processing, selling, shipping, storing and transporting are ancillary to the buying and selling aspect of the definition. The amendment, therefore, de-emphasizes the buying and selling aspect of the term marketing.

Another amendment which was made to the Act enlarges the authority of the board to make regulations to provide for the producing of regulated products on a quota basis. The amendment would prohibit any person to whom a quota has not been fixed and allotted for the producing of a regulated product, or whose quota has been cancelled from producing any of the regulated product.

It would also prohibit the production of a regulated product in excess of quota, and it would prohibit any person to whom a quota has been fixed and allotted for the producing of a regulated product on lands or premises, in respect of which such quota was fixed and allotted, from producing any of the regulated product other than the regulated product produced on such lands or premises.

The Consumer Association of Canada, and the Ontario branch in particular, seem to take issue with the amendments dealing with production control and the setting of minimum rental fees and the terms and conditions of land leasing to a negotiating board.

The consumer group tends to blame food price increases on marketing boards and the orderly marketing system. I must say, Mr. Speaker, that I get more than a little annoyed when I hear the Consumers Association of Canada laying the blame on marketing boards for rising food costs. The consumers should consider the other side of the coin, and that is the role which food prices play in keeping down the cost of living.

I don’t know how one gets the message to the consumer. I would have hoped more members would have stayed in the House to listen to my remarks. Not that I think they are all that great, but I think we have a responsibility to get a message across to the consumer. The message is what a privilege it is to live in this country and to enjoy an abundance of high quality food at more reasonable prices than you will find anywhere else in the world. So I am hoping the members will take some time to read Hansard and the remarks I am making, and then go out and spread the message to those consumers who are led down the garden path by the Consumers Association of Canada. That is my own personal opinion.

The consumers group, as I say, should consider the other side of the coin, and that is the role which food prices play in keeping down the cost of living. I don’t know how one gets the message to the consumer, but the fact of the matter is food prices have decreased while the prices of all other major consumer items have increased.

To use an example, Mr. Speaker, I am going to take a time period from September 1975 to September 1976. Housing, including utilities, furniture, appliances, et cetera, increased 11.2 per cent; clothing increased by 5.8 per cent; transportation increased 10.1 per cent. In the same period, food at home decreased in price. Now get this, when everything else is going up, the price of food at home decreased two per cent; and total food, including that consumed away from home, decreased 0.5 per cent.

If other prices had stayed the same as they were in September, 1975, and only food at home had made a change of minus two per cent, the consumer price index would have dropped about 0.5 per cent. Instead, it increased 6.5 per cent.

Too much has been said lately about the supposed cost of supply management and marketing boards. These figures show clearly that food prices have not been increasing at an alarming rate, and indeed they have not been increased at all. I am going to take some statistics to prove this point. These statistics deal with the personal consumption expenditure for food.

If I go back to 1960; 16.1 per cent of income was spent on food, consumed at home, 4.1 per cent was spent on food away from home. In 1965, the figures were 14.2 per cent of income spent on food consumed at home, and again four per cent on food consumed away from home. In 1970, it was 13.4 per cent of the consumer’s income was spent on food consumed at home, and 3.9 per cent spent on food consumed away from home. In 1976, the figures were 12.7 per cent of personal income was spent on food consumed at home and again 4.1 per cent on food consumed away from home.

Can you imagine 12.7 per cent or 13 per cent, and add on to that another four per cent of food consumed away from home, so in the neighbourhood of 17 to 18 per cent of the consumer’s income was spent on food; and yet there is all this hue and cry about the high price of food. It makes me sick; and I don’t mind telling my consumer friends that.

I happen to get elected time after time and I spread that very same message, that the consumers don’t know how lucky they are paying as little for food as they do; getting high quality, and an abundance of it.

While I am talking about food, I would just like to quote from a speech the federal minister gave at the Ontario Federation of Agriculture last week some time; I just forget the date.

Hon. W. Newman: Tuesday night.

Mr. Riddell: I quote: “I want assurance that Canadians can rely on getting the best value for their food dollars. Right now it is estimated that 18 per cent of every take-home dollar goes on food. That’s assuming one meal out of three is eaten out of the home. A report put out by the USDA puts that figure at 13.8 per cent being spent on meals taken in the home. That’s compared with 26.5 per cent in Italy, 21.5 per cent in the United Kingdom and 15 per cent in the United States. So our food prices are lower here than they are in the United States or a lesser percentage of the consumers income is going on food here than in the United States.

“A couple of weeks back Statistics Canada announced that the consumer price index was up one per cent in October. They said that food and housing were the main culprits. I hope that made a few farmers mad. It made me mad. I wish the whole story could be told.

“Consumers should understand that a consumer price index is not a cost of living index. Cost of living is money spent on living as a per cent of total disposable income. The consumers price index is simply a list of 325 consumer items that are compared monthly and these items went up in October. So did food. But not as much as it looks on paper.

“That’s because Statistics Canada weights the food part of the index higher than it should. About 18 per cent of your income goes on food. Statistics Canada uses 27 per cent, which is the percentage we spent on food 25 years ago. Food did cost less 25 years ago, but it wasn’t cheaper.

“Back in 1951 an average hour’s pay bought 1.2 pounds of sirloin steak; in 1976, that same hour’s pay bought 3.5 pounds. Back in 1951, you could buy 1.2 pounds of prime rib roast with an hour’s work; last year you could buy 4.5 pounds. A 1976 hour would buy four times as many eggs, two and a half times as much chicken and over twice as many pork chops; twice as much milk, potatoes, apples and bread compared to 25 years ago.

“We live in a luxury-minded society today; expensive vacations, fancy cars, two televisions are all looked on as necessities. Yet most people resent paying out for the real necessities; and food is one of them. The less we can pay the better we like it.

“And another thing; in this great credit-oriented society, it is hard to pay cold cash for anything, and food is a cash-on-the-barrelhead proposition.

“I want to do all I can to make sure that consumers get the most for their food dollar, but not at the expense of the farmer. And I want to make sure that the farmer gets all the help and the reassurance he needs from our system, but not to the point where the consumer pays an unreasonable price for food.”

Now, that’s the end of the quotation from the federal Minister of Agriculture. So, Mr. Speaker, it boils down to the fact that marketing boards are not villains, and they may even be heroes. Consumers in Ontario should be thanking marketing boards for their role in assuring an abundance of high quality food at reasonable prices; and they should be supporting the marketing boards in their attempt to keep family farms in business by providing for them an adequate living, even if it does mean production controls of some of our farm commodities. Surely consumers, who have seen what a lack of competition has done to their energy costs, would want to support any attempt to keep a viable agricultural industry in the province of Ontario.

[4:15]

A final amendment to this Bill 102, Mr. Speaker, enlarges the duties of persons appointed to inspect the books, records, documents, lands and premises and any regulated products of persons engaged in producing or marketing the regulated product. For example, the Apple Marketing Commission changed its method of financing in July 1975 from a volume or poundage system, to an acreage system, with all growers being assessed on their producing apple acreage.

A small number of growers, however, refused permission for inspectors to measure their properties. They were within their rights to do so, as the Farm Products Marketing Act did not contain a provision to permit the measurement of land. The Act is now amended to permit appointed persons to enter on lands or premises used for the producing of any regulated product, to measure the acreage or the area of land used to produce the regulated product, or perform accounting of the regulated product.

I would like to conclude by saying that marketing boards in my opinion have been of great benefit to producers and consumers alike. Without these amendments to retain and strengthen orderly marketing the farming industry will be seriously jeopardized. I am sure the members of the Legislature understand the importance of orderly marketing of farm products under marketing board legislation and will support these amendments.

In view of the fact that producer/processor negotiations will be commencing any time now, I would hope that we could get this bill down into committee and back into the House for passage before the end of this session.

These amendments are urgently needed and we, in the Liberal Party are certainly going to support Bill 102. Thank you very much.

Mr. MacDonald: Mr. Speaker, I am going to speak briefly, because the minister has already explained the purpose of these amendments and the hon. member for Huron-Middlesex has given a very detailed and useful background of the situation that made these amendments necessary. There is no need to repeat that. It is on the record. Much of what was said, both by the minister and the hon. member, I agree with, therefore it need not be repeated.

I don’t know that this bill is really the appropriate place to go into a great defence of the limited cost of food in terms of a family budget. I think it is appropriate, particularly because of the position of the Canadian Consumers’ Association, that their views should be put in context and should be commented upon; and that I shall do.

I am not completely in agreement with one aspect of the hon. member’s comments in which he tends to dismiss all of the cost of food as being completely beyond examination and review. As far as the farmers are concerned, I would have no differences with them at all. The food industry in this country is the largest industry -- the largest industry. When one thinks of the food industry, most people think of farmers. The fact of the matter is that farmers today represent 20 per cent of the food industry. Eighty per cent of the food industry is beyond the farm gate in terms of transportation, and processing; in terms of wholesaling, retailing, packaging, labelling, refrigeration; all of those things that go into gobbling up more and more of the consumer’s dollar until all too little of it gets back to the farmer.

I think there is an area for examination which could result in two things: the farmer getting more because he is entitled to it; and conceivably the consumer paying less, even though I would agree that the consumer in Ontario and in this country gets a bargain as far as food is concerned.

We will support these bills. Let me put that on the record right at the outset, Mr. Speaker. We will support them because I agree with the case that has been put by the minister, and again by the critic from the official opposition. We have a situation in this province that if we do not plug the loopholes which the courts, in their perversity, have opened up -- just a brief digression here.

I have been amazed in the last six or eight weeks at the number of times when court decisions affecting various aspects of life in this province and country have been made which in my view as a layman are just perverse. They’re a violation of the original purpose of the Act. They are legalese run rampant. What we have to do is plug those loopholes.

Mr. Speaker, I want to put this in context, because the thing that disturbs me about the government’s action is not that they have acted now, but that they have taken so long to act on this particular problem. We’ve known about it for at least the better part of the past year, and we could have guessed the consequences that would flow from it, particularly once the courts rendered their decisions.

I want to take the hon. members back a bit in Ontario’s experience with farm marketing. I want to repeat a story which I told at the OFA banquet the other day. Back in the late 1950s, we had one of the major crises of farm marketing in this province. Marketing had been put on the books back in the 1930s and early 1940s; it was a power which was granted farmers to exercise as they saw fit, when they saw fit. If they didn’t see fit, they didn’t need to exercise it. We’ve had the classic example of the beef producers of this province refusing to exercise it and have any kind of marketing legislation even to this day.

I was fascinated to discover at the OFA convention last week that since the bureaucracy in the Cattlemen’s Association has frustrated the desires and needs of a growing proportion of the beef producers, an expression of that frustration has emerged in an alternative organization, the Beef Producers of the Future; and it was also expressed on the floor of the OFA convention where they passed a resolution calling upon the OFA to take a lead in bringing together the Cattlemen’s Association and the Beef Producers of the Future, to meet with the minister to consider some way of producing orderly marketing.

I was even more fascinated to discover that of a convention of a few hundred delegates -- I don’t know exactly how many -- by a quick count, there were no more than 15 or 20 who opposed that motion. So here once again is an effort to break through the bureaucracy of a group of leaders which has really been frustrating for all too long the needs and desires of people in that industry. Quite frankly, the government has played a part in that frustration, which takes me back to my story.

In the latter part of the 1950s, the crisis that emerged in marketing focused within the hog marketing plan of the day. A pioneering, militant farm leader by the name of Charlie Mclnnis was attempting to develop marketing legislation which would protect the producer and rescue him from being just a pawn in the game between the packing houses. In addition, they became persuaded that the only way they could get some measure, in terms of processing cost, was to build a processing plant, known as FAME. The farmers began to put money in it. It was this government, in collusion with people down on Bay Street, who frustrated the efforts to finance this. The thing went down the drain, and Charlie Mclnnis, a disillusioned and a cynical man, has tragically retired to his farm somewhere in Grenville or the eastern part of this province.

Mr. Nixon: We all have our stock certificates.

Mr. MacDonald: Yes, including me.

Mr. Nixon: I can believe it.

Hon. W. Newman: Do you want mine too?

Mr. MacDonald: Sure, I bought it. I’ve always been on the farmers’ side.

Hon W. Newman: Do you want my stock certificate?

Mr. MacDonald: There are two kinds of farmers; those who farm, and those who farm the farmers. Sometimes I wonder which role the Tory Party is in.

Hon. W. Newman: Ah.

Mr. MacDonald: Okay, just a minute now.

Mr. Samis: You woke Darcy up.

Mr. MacDonald: Darcy is up on his little podium and is going to start again, is he?

Mr. Makarchuk: He hasn’t got off yet, has he?

Hon. Mr. McKeough: No, I’m just looking at all those farmers over there whom you have elected over the years. You’ve really done so well in this area.

Mr. Samis: Well, our heart’s in the right place.

Mr. MacDonald: The incident I related at the OFA banquet was one at a convention of the OFA held down in the Crystal Ballroom in the old King Eddy Hotel.

The then Minister of Agriculture, Bill Goodfellow, was speaking to the convention, and following that he offered to answer questions. At one point, a gentleman by the name of Jack Broderick, the late Jack Broderick, one of the pioneers in the fruit marketing plants in the Niagara Peninsula, got up and said: “Mr. Minister, we are very appreciative of what this government has done in terms of putting legislation for farm marketing on the books. We’re very appreciative. We’ve got it. We are attempting to exercise it.”

“But,” he said, “the crunch is coming; not only in hog marketing, but in many other areas. The crunch has come.

“Now, Mr. Minister” said he, “are you with us shoulder to shoulder in exercising this power which you granted to us in farm marketing legislation?”

Bill Goodfellow, whom many of us who have been around for a little while will recall, had a capacity for philosophizing in a fashion that usually went over with farmers. It was a mixture of back-concession philosophy and things of that nature. He gave an answer which, of course, evaded the question.

Jack Broderick got up to his full height, about six foot four or five with shoulders about two and a half feet wide -- he looked like a lineman the Argonauts needed, and indeed he had been a lineman on the football team at the University of Toronto -- he walked to the mike -- and you could have heard a pin drop because everybody knew that Jack Broderick was an active, committed Tory -- he went to the microphone and he said: “Mr. Minister, you haven’t answered my question. My question was you gave us the power, we are now attempting to exercise it, so are you with us shoulder to shoulder in terms of exercising that power?”

I’ve forgotten what Bill Goodfellow said. It was the scene that was memorable. I think his answer was equally unmemorable as the first crack that he took at it.

The crunch has come a second time. We have had breaches in farm marketing which raise the prospect that farm marketing in this province could be destroyed completely. Indeed, without the amendments which the minister has brought in, we faced the prospect that this kind of collusion, this kind of development of ways of circumventing the marketing legislation, would be emerging all across the board in the province of Ontario. It would pull the rug out from under the whole structure of farm marketing legislation.

I suggest to the minister that this could have been foreseen way back last spring. I was raising this issue in the House all during the estimates last year, and indeed to be fair, the hon. member for London Centre (Mr. Peterson) was also raising the issue. We couldn’t get anything out of the minister. He evaded the issue. So we drifted into a situation in which the government had no alternative, because they were faced with a rather massive lobby a short time ago. In fact, I think the record should be recalled in one or two other instances.

The hon. member for Middlesex (Mr. Eaton) who at that time was parliamentary assistant to the Minister of Agriculture and Food, spoke in Strathroy some time last spring. As reported in the London Free Press, Mr. Eaton said that ministry officials have looked at the situation, the situation with regard to the Eastern Ontario Vegetables Growers Co-op. He was quoted directly as saying: “As one of our fellows put it, it’s all legal, but it looks pretty damned immoral. There is no doubt in the world they are doing it to circumvent the marketing board agreement.”

If something was legal, but immoral, I think there was an obligation on the government to say: “Okay, the Act is being violated. We’re going to step in and make the necessary amendments.”

Let me give you another example of the kind of thing that went on, the kind of quotes we got from the head of the Food Council of the province of Ontario. Again I put this on the record way back last spring, when queries were put to Mr. Williams, the head of the Food Council, as to what should be done about it. What did he say?

[4:30]

Mr. Williams said he didn’t understand why other processors and growers are upset because Trenton production is geared to the export market. “That’s sort of like me saying I am upset because I bought a ticket on Wintario and I didn’t win anything and you did,” he said.

Mr. Williams said it is the first example he has come across where growers have become vertically integrated; involved in both growing and processing their products, when normally it is the processors who did so. “What’s the difference between growers vertically integrated and processors doing it?” he said. “A vertically-integrated plant has a tremendous advantage at the moment because they can produce corn themselves”; and so on and on.

Here’s a man, the head of a body whose usefulness I have almost come to the conclusion is nil, but presumably he is there to do something to protect the interests of the producers, but who -- well, he’s like the Irishman of whom they said, “He’s neutral but who is he neutral against?” When it comes to balancing up the interests of processors who are represented on the Food Council and the producers, the processors’ interests always are going to get top billing.

Then we have, of course, the comments of the former Minister of Agriculture and Food, a pretty formidable champion of the farmers on occasion. The question was raised at the annual meeting of Hardy Farms. Since the president of Hardy Farms had indicated the extent to which marketing boards -- here’s your old attack -- were frustrating them and were going to make it difficult for them; and the government -- this bad government -- was going to bring in amendments to plug the loopholes; the chairman turned to Bill Stewart in his new capacity as a director of Hardy Farms and asked him what about it?

What did Bill Stewart say? Mr. Stewart said that he’s concerned that Ontario sweet corn growers have set prices too high in relation to US corn prices, and that the Ontario industry will lose export markets as a result. “The fact that certain producers in eastern Ontario have been willing to take action to circumvent the marketing legislation was an indication that producers were prepared to produce corn for lower prices,” he said.

“There has to be a realization by producers of the need to take a realistic viewpoint. Otherwise they will kill the goose that laid the golden egg.”

In other words, here’s a man who was Minister of Agriculture and Food, getting up and in effect saying that the farmers were pricing themselves out of the market. Now whether or not they had negotiated too high a price I am not willing to argue. It is one of the reasons I suggested to the minister in the estimates that the sooner we can, in all of these arguments, in all of these negotiations, get towards the pricing of a product in accordance with a formula that takes into account the cost of production, preferably even an economic formula, then you will have an answer that readily disposes of the usual kind of propaganda that you get from the Canadian Association of Consumers.

But all down the line, you had coming from various people who were spokesmen of the government, the parliamentary assistant and others, an indication that you had a situation that required some correction, yet there was no move on the part of this government to do it.

Now why did they move?

Hon. W. Newman: That’s utter nonsense.

Mr. MacDonald: I will tell you why they moved. They moved because on March 17 there was a massive lobby headed by the OFA, and involving 19 of the marketing boards. And when they camped on your doorstep, you had no alternative but to --

Hon. W. Newman: What date?

Mr. MacDonald: Pardon?

Hon. W. Newman: Get your dates straight.

Mr. MacDonald: October 17; what did I say?

Hon. W. Newman: The hon. member said March 17.

Mr. MacDonald: I am sorry, October 17.

Mr. Makarchuk: The hon. minister remembers that date, do you?

Mr. Martel: That is the day they gave you the good news.

Mr. MacDonald: You bow to pressure as this government always does, but will never act in advance. I will tell you why. The answer, and I say this to my good friend from Huron-Middlesex also, is of course that you are both ardent champions of free enterprise; and let’s face the reality, marketing boards aren’t an expression of free enterprise.

Mr. Makarchuk: Right on.

Mr. Martel: Right.

Mr. MacDonald: Marketing boards are a protective mechanism that have been built by farmers to protect themselves against the ravages of uncontrolled free enterprise.

Mr. Martel: Right on.

Mr. MacDonald: And therefore, periodically, when there is a test case and you have to make up your mind whether you are going to stand shoulder to shoulder with the farmers to make certain their marketing boards are protected, you take a long time to move on the issue.

However, you have moved, and I thank God for that. Since all parties in the House are in support of it, I hope that without any undue delay the bill will be passed so you can have the protections as we move into the next season.

Let me turn briefly, if I may, to the Canadian Association of Consumers. I don’t really object to most of the comments that have been made by the hon. member for Huron-Middlesex with regard to the Canadian Association of Consumers. I would just like to put it in a different context, though. The Canadian Association of Consumers is financed to the extent of about $500,000 by the federal Liberals; and they siphon some of that down to the Ontario Association of Consumers. I don’t know of any government which has developed a more mindless opposition to farm marketing boards than the federal Liberals.

Mr. Mancini: That’s a libellous statement.

Mr. MacDonald: Just a minute, it’s not libellous, it’s a true statement.

Mr. Nixon: Whelan is the strongest advocate; without Whelan where would the farmers be?

Mr. MacDonald: It’s within the bureaucracy, and it was expressed by nine members of the committee of deputy ministers; the only man who is valiantly fighting to stop the whole of the rest of the government and the bureaucracy is Gene Whelan.

Mr. Nixon: He is running the show for the farmers there.

Mr. MacDonald: I concede it.

Mr. Nixon: Thank God for Gene Whelan.

Mr. MacDonald: But the fact of the matter is that if the government and most of the people who are shaping the government’s policies in the Consumer and Corporate Relations end had their way, farm marketing would be in trouble.

Mr. Nixon: Down there the minister runs it, not like here.

Mr. Martel: Say that with a straight face.

Mr. MacDonald: Well as a matter of fact, the ministers down there and here, neither of them run.

Hon. W. Newman: At least I am not a swimming pool farmer.

Mr. Nixon: No, you are a developer farmer. Your farm has been developed.

Mr. Martel: You didn’t sell it?

Mr. Acting Speaker: Order, please.

Mr. MacDonald: In league with that mix of government and bureaucracy at Ottawa which is mindlessly opposed to farm marketing boards, voiced by people like Beryl Plumptre and so on, you have the Canadian Association of Consumers, as it is now called, financed to a great extent out of the public treasury.

Just let me show you the kind of nonsense we have. I have in my hand the letter sent by Barbara S. Shand, president of the Consumers Association of Canada, Ontario branch. Let me read you the second paragraph:

“It has long been the stated belief of the CAC Ontario that in the long term a competitive market in which all participants are able to bargain freely, because that bargaining power is shared, is in the best interests of all those involved -- producers, processors, retailers, consumers, et cetera.”

Now for a piece of naive comment, I have rarely heard anything to match that. Anybody who thinks in the marketing of food you have got a competitive market is naive. It is not competitive to put the farmer, without a marketing board, along with the processor and along with the wholesaler; particularly when you stop to consider what you have got in the food industry today is five giants: Weston Loblaw’s, Argus Dominion, Steinberg’s, A & P, and Safeway. They are monopolies that are an oligopoly, because you have got a group of monopolies. Each of these is engaged in the production of food, the transportation of food, the processing of food, the wholesaling of food and the retailing of food. Each of the links along the way takes its profit. The profit all goes into the same pocket.

How, in that picture, could anybody have the naiveté to suggest that what they want is a free, competitive market, and that what they want is in the best interests of the consumer. That’s the way to rook the consumer and that’s the way to rook the farmer. And I hope sometime soon the Canadian Consumers Association is going to wake up to reality and not be engaged in some 20th century regurgitation of Adam Smith in its purity. It’s a little out of date, it’s as out of date as Aunt Minnie’s hoop skirt.

Mr. Sargent: Right on.

Mr. MacDonald: Let me go on to the two points.

They say: “Our concern with the proposed amendment is therefore understandable.” You can understand they’re going to be concerned in view of that garbled account of economics, with no reference to the real world. So they object to the proposition that the boards are going to be given the authority to set minimum rental fees.

As my hon. friend from Huron-Middlesex has already pointed out, the reason that’s there is so the integrated industry isn’t going to be able to set a phoney $1 per acre, or something of that nature, suggest they’re producing food more cheaply, and thereby undercut the marketing board. Then, of course, they go on to their usual vendetta against production quotas and the whole exercise of supply management.

Just let me say this in conclusion: I hope some of us can sit down sometime soon with the Canadian Association of Consumers and give them a few facts with regard to marketing, marketing boards, and what the farmers are entitled to as a fair return in light of the figures already on the record.

Mr. Riddell: Couldn’t agree more.

Mr. MacDonald: Good, we agree on some things. We disagree when it gets down to that basic philosophy, that pursuit of the myth of free enterprise. Because it is --

Mr. Samis: Albert will give us a lecture on it.

Mr. Roy: When you get carried away on nationalizing everything, we are bothered; and you espouse that very often.

Mr. Acting Speaker: Order.

Mr. MacDonald: Mr. Speaker, I have concluded my remarks, I just want to say one thing further. Normally, I don’t object to bills being sent to committee, but in this instance there is no need for the bill to go to committee. The minister has met with all of these people. He has explained the situation. He has set up a committee which is going to work it out.

I suspect the hon. member for Huron-Middlesex is correct: This has been sent to the committee primarily because there is a group of people, headed by the former local bagman for the Tory party, who are making a real attack on this from down in the Northumberland area. That’s why the government has had to bow and at least give them their last day in court.

Okay, let’s give them their day in court; it may be an opportunity to expose the kind of structure built down there, in which it is my impression the producers are getting the short end of the stick.

We support these bills. We support them with vigour, and I hope we can proceed, get them through and give them third reading and royal assent.

Mr. Conway: A great farmer.

Mr. O’Neil: I have a few words to say on this, because I am a member from eastern Ontario. Trenton has been mentioned a couple of times. I might state --

Mr. Conway: Great town.

Mr. Mancini: Well represented.

Mr. O’Neil: -- that both of these companies, or the co-op mentioned, lie outside of my riding, but some of the problems which they are discussing do affect farmers within my area.

I have not been totally in agreement with the remarks of our member for Huron-Middlesex, but I do appreciate the research that he has done.

Mr. Martel: Here comes the split.

Hon. Mr. McKeough: The schism.

Mr. O’Neil: As members from eastern Ontario we have been called, phoned and wired by some of the farmers and people mentioned in today’s discussion.

Mr. MacDonald: He is trying to have it both ways at the same time.

Mr. Conway: I want you to know I heard --

Mr. O’Neil: The member for York South mentioned he was sorry to see it going to committee. I am not at all sorry. When certain accusations are made, people should be given the opportunity to appear at committee meetings to show either that they are untrue or that they are true. Therefore, I will see that some of the people named today are given copies of the minister’s introductory remarks and the remarks made by some of our and the NDP members, so they are fully familiar with what has been said, so they can come prepared to let us know whether those statements are true or not.

This thing goes into other problems, and the member for York South mentioned where some of the problems lay. I think some of the blame lies with the present minister and with his ministry staff. I feel, as was mentioned, that these problems were mentioned a long time back, and if the fault lies with Mr. James, or if it lies somewhere in the marketing board, or with the Eastern Ontario Vegetables Growers Co-op, these arguments should have been put to these different people and the problems should have been corrected.

[4:45]

Hon. W. Newman: What do you think we did for crying out loud?

Mr. O’Neil: If that is the case, why wasn’t this thing brought to a head sooner? Why wasn’t this bill introduced sooner?

Hon. W. Newman: I will explain it all to you later.

Mr. O’Neil: Very good. I’ll be looking forward to your explanation.

Mr. Samis: He is the labour critic.

Mr. O’Neil: I also feel, besides placing some of the blame with the minister and his ministry --

Mr. MacDonald: You can’t be on both sides of the fence at the same time, you know.

Mr. O’Neil: -- that also some of the blame should be placed with the Ontario Federation of Agriculture.

Mr. Mackenzie: How about the real estate board?

Mr. O’Neil: These are the problems that exist. They have been aware of them for some time. It is their obligation to have appeared before those farmers to explain the circumstances as they were.

Hon. W. Newman: That’s what they did.

Mr. O’Neil: Why didn’t you do something about it?

Mr. Acting Speaker: Order!

Mr. O’Neil: Our member for Huron-Middlesex has gone into this very well --

Mr. Martel: You had a rough time with labour, wait till the farmers get you.

Mr. O’Neil: -- and I hope that some of the solutions he has come up with will be looked at very carefully by this committee that you have set up or are setting up. But I would like to read from the judgement between the Farm Products Marketing Board and the Eastern Ontario Vegetable Growers Co-operative, some remarks made by Judge Lerner.

Mr. Makarchuk: Make sure you send this out, make sure you mail out this speech.

Mr. O’Neil: And I may quote: “Sweet corn growers in the eastern part of Ontario have suffered a gradual loss of markets for processing because local processors have ceased to operate. It was alleged that these processors were unable to meet the competition of the export market because the negotiated prices which they were required to pay have not been competitive. The negotiated price has apparently risen sharply in recent years and the European export market prices are falling.

“Of the annual harvest, 80 to 90 per cent is marketed out of Ontario. These eastern Ontario farmers and growers have, since 1976, had no processors to whom they can sell their corn. This allegation was not challenged by the board. Therefore, what may constitute a successful marketing plan for some areas of Ontario’s sweet corn producers appears to be otherwise in the eastern Ontario growing area.”

Mr. MacDonald: It was none of his business.

Mr. Conway: Settle down, settle down.

Mr. O’Neil: As I say, there was some mention made in the remarks by the members talking about the vertically-integrated companies, and a lot of those companies or most of them are located in western Ontario.

For the information of the Legislature, approximately 22 to 25 per cent of this market is controlled by these large integrated companies. When we look at eastern Ontario where at one time we used to have many producing plants, many canning factories to look after the produce that was produced in that area --

Mr. Conway: The Tories have run them all out of town.

Mr. O’Neil: -- Prince Edward county, Murray township, Quinte riding; we no longer have these plants to look after these things for the farmers.

Mr. Mancini: That’s your industrial strategy.

Mr. O’Neil: I think it is the obligation of this minister and this ministry, and the Ontario Federation of Agriculture, to look at the problem that we have in eastern Ontario; to see that these farmers are given a chance to compete in this market. As I say, our member for Huron-Middlesex came up with some good recommendations and I hope that they are looked into very carefully.

I think it would be very useful also if some of the research staff in this Legislature from the different parties were to look into some of the large amounts of grants and loans that have been made to these integrated companies. Some of these loans have helped to drive some of the other smaller canning factories out of business.

Mr. Samis: And your friends the feds?

Mr. Haggerty: You buried them.

Mr. Conway: Big business Tories.

Mr. O’Neil: I am not a farmer in the sense that some other people can talk about it.

Mr. Samis: No, you are not.

Mr. Conway: But you are close.

Mr. O’Neil: But I would say this, I am pleased that this thing has been brought to a head. I look forward to it going to committee on Thursday. I look forward to the people who have been named in the Legislature today being able to appear before that committee to pour forth their arguments; as I say to either prove or disprove, on both sides. That is all that I have to say, Mr. Speaker.

Mr. Conway: No wonder you won by 7,000 votes!

Mr. Samis: Mr. Speaker, first of all let me say that I don’t intend to in any way match or emulate the balancing act just perpetrated by the member for Quinte.

Mr. O’Neil: It is not a balancing act at all.

Mr. Samis: I speak on this bill, as the member for Renfrew North well knows, as a part-time scrub farmer, from the fertile climes of Cornwall, not unlike those of Renfrew North. Let me say very succinctly that I would fully support the amendments being brought in because I think there is a fundamental principle involved, as my colleague from York South and the member for Huron-Middlesex have indicated. If we are going to try and preserve independent operators, if we are going to try and preserve some degree of competition in the agricultural industry, obviously we have to do something about the whole question of vertical integration.

As my colleague from York South has said, we are not talking about small enterprises. We are not talking about entrepreneurs; we are talking about giants, conglomerates, multi-nationals; involved in the essence in vertical integration.

And it is not just in the agricultural sector. We see this in the resource sector as well. How can a small co-op or a small farmer compete with that, or how can he even survive on a regional basis? It is rather unfortunate that these interests have tried to utilize this loophole to full advantage and obviously, to the detriment of the marketing boards. That indicates a need to do something and we are glad, on this side, that the minister has finally decided to take action and close the loophole. I know we on this side are always conjured up as the party that would try to nationalize everything, prevent small entrepreneurs from existing, expanding, growing or surviving. But I think if one looks at the record, Mr. Speaker, it is very clear that my colleague the member for York South has been an early, strong, consistent and articulate advocate for marketing boards. He fought the battle for supply management in terms of the farm income plan, and we make no bones about our policies here in the NDP in terms of agriculture.

We have always supported the principle of competition and the small farmer; and we have always been prepared to take on monopolies, cartels, conglomerates; or the essential principles of vertical integration, we don’t try to straddle the fence on that one.

Obviously we have had mixed success in that regard, but our principles and our policies have always been designed to aid and abet small farmers, marketing boards and co-ops. And that goes back to the history and the days of the CCF in Ontario --

Mr. Conway: Tell the truth, tell the truth! Remember J. J. Morris.

Mr. Samis: Is our ivory tower colleague from Renfrew North suggesting something?

Mr. Conway: Don’t confuse the past.

Mr. Samis: Let me say that the independent operator has a vital role in the future of the agricultural economy in Ontario. Marketing boards we believe are essential, absolutely essential, for the survival of agriculture. I was glad to see that my colleague from York South talked about the Consumers Association of Canada and their mythical belief in free enterprise and the idea that these conglomerates can go unchecked if we have no marketing boards.

Obviously marketing boards are essential for the small farmer, for the regional distribution of goods. Small farmers will not survive without strong legislation protecting all aspects of marketing boards; and if this loophole is to be closed, it must be closed firmly today. I congratulate the minister on finally taking action.

Mr. Mancini: Mr. Speaker, I am pleased to rise and make my contribution to the debate concerning Bill 102 and Bill 103. I certainly support the amendments which have been brought forth by the Minister of Agriculture and Food. We have waited quite some time for these amendments to come forward. I have had many discussions in my area with people involved with marketing boards and we were very concerned about the slow tack the minister used and, at one point in time we feared that he might not introduce the amendments at all.

If my facts are correct, I think at one point the Premier (Mr. Davis) was involved in these meetings. I would just like to say for a person who is supposed to be the protector of the farmer in this great province, we were a little disappointed in his manner. Anyone who would be the Minister of Agriculture and Food should have moved with a little more haste.

Mr. Speaker, it has taken over 40 years to build up the marketing board system that we have here in the province of Ontario. We know what would happen in this province if the farmer did not have this protection and if he had to deal himself with the processor. We know what would happen in my riding of Essex South where we have the Greenhouse Vegetable Marketing Board if the farmers had to deal themselves with Steinberg’s. We know what would happen; Steinberg’s would send down a representative and they’d make individual contracts with the individual farmers.

Hon. W. Newman: I’m listening.

Mr. Mancini: Just keep listening. First thing you know, the farmers wouldn’t be making any money and Steinberg’s would be buying up and owning the land and the farms. I don’t think this is what we want in the province of Ontario.

That’s why I’m supporting these amendments. I think they should have been brought in earlier. I would also like to comment and say I don’t think this bill needs to go to committee.

Mr. Samis: Oops, here we go. Talk to Hughie.

Mr. Mancini: This problem needs immediate attention. I really wonder why the minister has to send this bill to committee when he has already met with the Federation of Agriculture, and has already talked with all the marketing board people on several occasions. As a matter of fact, some of them were complaining to me he was off gallivanting down to Australia while this problem was on the back burner.

Mr. Conway: Worse than the Minister of Industry and Tourism (Mr. Bennett).

Mr. Mancini: I don’t know why we have to delay the implementation any further. I would just like to close by saying we are glad he has brought in the amendments and we’re certainly ready to support them.

Mr. McGuigan: I rise in support of this bill; and I don’t wish to add any more to the very well stated arguments of the member for Huron-Middlesex and the member for York South. But I rise with great personal satisfaction, because I’ve waited 40 years, I guess, to have a personal hand in this. It’s going to give me a great deal of satisfaction to vote in favour of this bill.

As a child at school, in deciding on a career, one of the two main elements that made me decide to work the family farm were the example of Herb Hannam, who revitalized and reorganized the Ontario Federation of Agriculture. The other was the government of the day which brought in the Farm Products Marketing Act at various times during the middle 1930s. These, of course, were tested in the Supreme Court. I would remind the hon. members that when that Act was finally passed, it was passed in this Legislature without a dissenting vote.

I would like to say that personally I have been a member of a co-operative that was organized in 1953 to process and sell frozen cherries. Those original five people have now grown to about 40 members. They struggled and clawed and fought their way into the domestic market, and eventually into the export market where we now have quite an impact in selling frozen cherries to Britain.

Of course, the temptation, I guess, was always there to judge the situation, as these people have in eastern Ontario. I’m proud to say in all those years, in spite of the very great difficulties and the hardships we had to go through in order to fight our way into that market, at no time did we ever consider paying the farmer less than his full negotiated price.

I’d just like to remind members of what might happen if these actions were allowed to destroy the Farm Products Marketing Act. In Canada 75 per cent of the groceries are sold by these five corporate chains already mentioned by the member for York South. In contrast, the corporate chains in the United States only hold between 30 and 35 per cent of the market. The Canadian chains have great influence and are able to dictate to growers. It’s been my business and my life to deal with these people, and I could tell you many personal horror stories, but time is late and I don’t intend to do that.

[5:00]

Among the abuses in processing would be overcontracting; the companies would contract for more than they were able to process, in order that there be a constant line of fresh product at their door. The farmer, of course, would bear the cost of that. Another was delayed payments, which were very much a part of this industry years ago. Farmers waited months, sometimes into a second year, before they were paid for their product. Oftentimes they did not even know what they would be paid, because they were paid on a consignment basis. Intimidation -- the farmer had to use some of the services of the processing company in order to get a contract; or in order to grow one crop that was possibly profitable, he’d have to grow another that would be unprofitable.

Concerning the destruction of the family farm, three weeks ago, Mr. Speaker, I listened to an economist speaking to the Chatham Chamber of Commerce rural-urban meeting. He was Dr. Henry Courtney from Purdue. He said the battle was already lost in the US. The farmers there had to face the reality that the traditional family farm was gone.

I could not help think, when I listened to him, that we could give him a lesson here in Ontario and Canada on how we have managed to resist this trend. What we’re doing here today is going to result in strengthening and adding a great deal to the future of the Ontario farm.

I will support this; I’m going to vote for it with a great deal of pleasure.

Mr. Nixon: Thank you, Mr. Speaker. As a representative for an agricultural constituency, I want to add my voice to others raised in support of this bill.

I really wish we had had similar support a decade ago, when some companies -- York Farms particularly comes to mind -- were using the legislation and the loopholes in it to vertically integrate the production of vegetables. There was a time in our area, on our farm, when we grew green peas as a profitable crop. We did a good job. Before we knew it, York Farms had integrated farmers like myself and my neighbours right out of the business, and we’ve never had a chance to take part in that part of agricultural production since that time.

However, I feel there has been a commitment on all sides of the House to the concept of orderly farm marketing through marketing boards. When I was first elected in 1962, there was deep concern with the powers of the Tobacco Marketing Board. The House, under the leadership of Bill Stewart, supported on all sides, and urged forward by myself, passed legislation that gave the Tobacco Marketing Board extensive new powers which I feel have put the tobacco industry on an orderly basis. Naturally they continue to face problems associated with markets, foreign and otherwise, but I believe the board has the powers, through the support of the producing farmers, to solve these problems in the best possible way. All they need is a little more support from government, probably another cent per pound to assist them in marketing. While they’re delighted that the minister undertook, at a great personal sacrifice, to travel around the Pacific Rim selling tobacco, we look forward to the orders being placed on a continuation --

Hon. W. Newman: Go to the auctions.

Mr. Nixon: -- of the concern of the government both here and in Ottawa for expanding those markets.

The next thing that faced us was the problem in milk marketing. We well recall the commitment given by this Legislature in establishing, under the Milk Act and the Milk Marketing Board, a system with unquestioned powers to regulate and control every aspect of the fluid industry. I just wish we had at that time taken the strong step in integrating markets so that we still didn’t have division, which we hoped would disappear as the market expanded.

I can remember the confident hopes and expectations as we read the numbers of government reports, and reacted to the legislation that was put before us in this House, that indicated we would have an integrated milk market and not the continuing division between the two governments, federal and provincial, and basically the two markets, one dealing with fluid and the other dealing with manufactured milk.

Of course, Mr. Speaker, in those days we had an agricultural committee of this House, and I have never gotten over a feeling of regret that in the so-called efficiency of recent reorganization, we have more or less parlayed ourselves out of an agriculture committee. Of course we have a committee that deals with agriculture bills, but it has a very broad responsibility in related areas of the development of resources. I would look forward to a swing of the pendulum or a rotation of the wheel which would see in this House once again the establishment, or the re-establishment of an agriculture committee that dealt with this singularly important industry, important in this province and to the members of this House.

Mr. Conway: Do you want Bill Stewart back too?

Mr. Nixon: We were quite concerned as well, Mr. Speaker, with a commitment to one farm organization. It sounds like sort of an old fashioned approach, and yet I, at the time, spoke, and as a farmer voted, in favour of a single farm organization. I remember the then Minister of Agriculture and Food went quite far out on a limb in that regard. I admired him for taking the stand at the time and I was prepared to support him, as I say, as a farmer.

I feel that the farmers do speak largely with one voice, although there are other well-organized organizations that speak for smaller groups of farmers and certainly, in the way it is developing, do often add different approaches that are interesting, if not always as useful, and are directed to practical solutions, as is the federation itself.

I say, Mr. Speaker, that I regret, to some extent, the comments made by the member for York South when he questioned the commitment of the members of this House to the concept of farmer-controlled marketing. He was practically imputing motives, I thought, to the Minister of Agriculture and Food and my colleague from Huron-Middlesex, because I am sure that the voting record and the comments in this House would show that there is no stronger supporter of the farmer as a producer and a marketer than my colleague from Huron-Middlesex. He’s a practical farmer himself and, in my view, he is one of the ablest spokesmen in that area that we have in the House. I want to congratulate him for the positions of leadership that he has taken.

Mr. MacDonald: I just wanted to draw attention to the conflict between that and free enterprise.

Mr. Nixon: Well, I suppose you had to get your digs in in that regard, but it appears that we are pretty much on the same side here. Perhaps there has been some reluctance on the part of the ministry or the minister -- and in any interjected criticism about who is running who over there, the criticism is of course directed at the minister. I have often felt that he didn’t really have enough self-confidence to take a hold of these issues the way he should, and I was even somewhat critical in the estimates. You know we had the feeling that whenever the Treasurer (Mr. McKeough) coughed the Minister of Agriculture and Food got pneumonia, because we certainly haven’t seen the commitment of dollars in this huge budget to the Ministry of Agriculture and Food that perhaps we should otherwise have enjoyed.

I want to close with this comment. Probably this is where I disagree with the member for York South and the Minister of Agriculture on something pretty basic. I have always felt it was a mistake when we changed the name of the Ministry of Agriculture to -- well, then it was Department of Agriculture -- to Department of Agriculture and Food. I recall the first change was to Food and Agriculture --

Mr. Deputy Speaker: Would the hon. member tell me what section he’s speaking to?

Mr. Nixon: It has to do, Mr. Speaker, with the orderly marketing of farm products which is, in my view, the principle of this bill. However, I will take your admonition and just say that since you allowed the member for York South to deal extensively with the consumer, with the Consumers Association of Canada, my concern is probably that the Minister of Agriculture and Food, and therefore the ministry, is concerned too much with the consumer. He should be a minister of agriculture and not a minister concerned with anything but quality, because I believe we still have a cheap food policy in this province which is not acting in the best interests of the farmers’ concern. The minister’s colleagues from a number of other ministries and departments have every responsibility to talk about the prices that the consumer pays, it’s up to a minister in agriculture to concern himself with the welfare of the farmers and the quality of the products they sell. The welfare of the farmers, as far as I am concerned, has to do with the return they get at the marketplace, and in my view this has been inadequate for a good long period of time.

I understand that the Treasurer wants to take part in this debate and assure us that he is supporting the farmers, even though the facts and figures in his budget year by year certainly do not reflect that. It may be that we can entice him to enter into this debate.

Certainly, as the member for Brant-Oxford-Norfolk, I am very much in favour of the principle of this bill. I wish that the powers for marketing boards in general had been strengthened long ago, and I might even still have been making a profit on selling canning factory peas, rather than having been forced out of the market by vertical integration.

Mr. Swart: I really had not intended to speak on this bill, but the members on the other side are applauding the fact that I am going to, very briefly.

Mr. Nixon: What stimulated you?

Mr. Swart: I rise because it seems to me rather important that someone from the Niagara Peninsula should speak on a bill which has such very serious implications for the Niagara Peninsula.

Mr. Haggerty: Move over, will you?

Mr. Swart: To date there has been no one from the Niagara Peninsula speak to this bill.

If the loopholes which have been opened up were permitted to continue, they could have rather devastating effects on the producers in our area. The Niagara Peninsula has quite a large number of broiler producers and other chicken producers who are finding it difficult enough at the present time to make ends meet. If there could be an extension of what happened already in the courts, it could have a serious adverse effect on those people, certainly in the Niagara Peninsula.

Hon. W. Newman: On the broiler industry?

Mr. Swart: Yes. In addition, we have a rather strong tender fruit marketing board in the Niagara Peninsula. At the present time we have there, basically, only one canning company dominating the processors there. It seems to me that in the not too distant future there is a very real likelihood that the producers there hopefully with the assistance of the provincial government, will establish a co-operative cannery. If so, it is important that they have the strength of this legislation behind them.

The grape industry lends itself to vertical integration. In fact, as people in the House will know, there has been a substantial amount of this in the grape industry. So once again, for the grape producers we need the protection of the amendments which are in this bill.

For all of these reasons, and perhaps more particularly the ones given by the member for York South, I am pleased to see these amendments being brought before this House, and certainly I will support them.

Mr. Deputy Speaker: Is there any other hon. member who wishes to participate in this debate?

The hon. minister.

Hon. W. Newman: I would just like to go over a few of the comments made here today. I would like to thank the member for Huron-Middlesex for his very comprehensive report on the reasons for passing this legislation. I followed his discussion with a great deal of interest and I think he did a great job. I’m glad I have a copy of it.

Mr. Conway: He is going to make one heck of a good minister of agriculture.

Hon. W. Newman: I certainly do want to point out that I know Mr. Eban James quite well, believe you me. But I don’t know what his political affiliation is. Whatever it is, I think it’s the wrong thing to bring up in this House. I have no idea what his politics are and when I am dealing with the farm organizations I don’t ask what people’s politics are. I deal with them as farmers and as human beings. I don’t look at their political affiliations. I think we should all do the same thing.

Mr. MacDonald: Don’t try to kid us.

Hon. W. Newman: I’d just like to say to the member for Huron-Middlesex that he spoke so well today and did such a great job that I’m not going to have a great deal more to say. I think it’s about time he came across the House over here.

Mr. Nixon: He will cross, he will be the minister this time next year.

Hon. W. Newman: I’m glad to see the member for York South, the Yonge Street farmer.

Mr. MacDonald: Welcome ye from Forest Hill.

Mr. McNeil: That’s the reason you’re over there and we’re over here.

Mr. Nixon: Did you say the minister lives in Forest Hill Village?

Hon. W. Newman: That’s exactly right -- that’s why the NDP doesn’t have any rural members and that’s why you will never have any rural members. I’ll tell you why you won’t have them, I’ll tell you exactly why --

Mr. MacDonald: Why don’t you deal with the issues instead of this --

Hon. W. Newman: You asked why we delayed this legislation. I’ll tell the member why. It was because we had a lot of co-operation and a lot of discussion with the Vegetable Growers Marketing Board and with the eastern Ontario co-op. There was an understanding last year which was not lived up to. But I have met with them all, I’ve been involved with them all, I’ve discussed it all with them, and we tried our best to work this out.

Mr. Nixon: What was the understanding?

Hon. Mr. McKeough: Carried.

Hon. W. Newman: We did our best by persuasion. So finally, we would not issue a licence and this led to a court case and the decision was handed down on August 24 --

Mr. Conway: Of 1977?

Hon. W. Newman: Of 1977, that’s right As a result of that we looked at the possibility of an appeal procedure from that court decision and we decided that we would move forward with legislation.

I had already moved before we met on October 17 to prepare the legislation.

Mr. MacDonald: Just a coincidence.

Hon. W. Newman: You check it out. You’ll see that I had already moved to prepare the legislation. It’s quite interesting, the member for York South says -- what does he say about those lawyers, those perverse decisions he talks about? How could we act in advance when we had all those perverse decisions you’re talking about?

Mr. MacDonald: You agree they were perversions.

Hon. W. Newman: I didn’t say --

Mr. Speaker: Could we have some order.

The hon. member for York South has already spoken in this debate.

Hon. Mr. McKeough: Carried.

Hon. W. Newman: I guess what really bothers me about the member for York South is that he asks where I stand. I’ll tell you where I stand and I’ll tell you where this government stands; it’s behind the farmers of this province. We always have and we always will. That’s why we’re over here, and don’t you forget that.

Interjections.

Hon. W. Newman: The member for Brant-Haldimand was talking -- what’s your riding?

Mr. Mackenzie: Those barnyard fumes got to you, Bill.

Hon. W. Newman: Anyway, the swimming pool farmer I call him. He was talking about my trip around the Pacific Rim. You might be interested to know there have been buyers here for the first time in 15 years -- buying tobacco -- from Australia. There are buyers here, buying tobacco, from Hong Kong, for the first time in many years.

Hon. Mr. McKeough: Get back to the bill.

Mr. Nixon: But the Premier is taking credit for that.

Hon. W. Newman: I’m just telling you that we were very successful, so don’t knock it because it helps your counterparts in Ottawa --

Mr. Foulds: With the ginseng.

Hon. W. Newman: -- with their balance of payments. There are several things that I’d like to say. I want to thank you all for supporting my bill. I think that augurs well for the future of agriculture in this province, that everybody is supporting it.

I don’t know what the member for Welland-Thorold (Mr. Swart) was saying, but let me point out to you I still don’t understand what you were saying and I’ll try to read it out of Hansard to comprehend it.

To the member for Quinte (Mr. O’Neil), I would just like to point out it wasn’t because of what you said or anyone else. I’ve had several representations ask for it to go to committee so people could make representations both for and against the bill.

Mr. Haggerty: That is a good suggestion.

Hon. W. Newman: I am going to ask, if we get second reading here, that we take rule 19, I believe it is, of the standing orders and -- I don’t know the proper procedure, Mr. Speaker, but you will know better than I do -- could we take this to the standing committee on Thursday afternoon, if we get second reading today, and it appears we are going to.

I understand that the Treasurer has another bill he’d like to bring forward --

Mr. Samis: He gave you the word, eh?

Hon. W. Newman: -- and therefore I’m not going to say anything further, except to say I think these are good amendments to both the Farm Products Marketing Act and the Milk Act. It will strengthen the farmer’s hand and I’m only too glad to bring this forward. With your co-operation we’ll have it as legislation before negotiations start.

Mr. O’Neil: What do you see as the solution in eastern Ontario for these growers?

Hon. W. Newman: Listen, I set up a task force. Doesn’t the member read? Doesn’t he know what is going on?

Mr. O’Neil: Yes, I do, but I’m asking the minister.

Mr. Speaker: Just ignore the interjections, this is not a debate.

Hon. W. Newman: All right, Mr. Speaker, I will talk about the task force I set up.

Mr. O’Neil: What’s the solution?

Hon. W. Newman: I set up a task force chaired by the chairman of the Farm Products Marketing Board, Dr. George Collin with members from the Vegetable Growers Marketing Board and from the processors.

Mr. MacDonald: That is all on the record.

Hon. Mr. McKeough: Carried.

Hon. W. Newman: This task force is now at work. The vegetable growers board has offered to co-operate to help them solve their problems.

Mr. Samis: The Treasurer speaks from the heart.

Hon. W. Newman: So, Mr. Speaker, I just don’t want anybody to think this government doesn’t support the agricultural community of this province, because we do, right down the line. I could go on at great length, for hours --

Mr. Nixon: Go ahead.

Hon. W. Newman: -- but I won’t.

Mr. Conway: Why do you dislike eastern Ontario?

Hon. Mr. McKeough: Carried.

Hon. W. Newman: No, wait a minute, I just got a note and the member had better hold on until I see what it says.

Somebody says keep talking; no, I don’t intend to do that.

Mr. Warner: Only a masochist could send a note like that.

Mr. Cunningham: The Treasurer doesn’t care about farmers.

Mr. Conway: Tell us why you don’t like eastern Ontario.

Hon. W. Newman: I hope I have answered all the concerns. Both parties have agreed with me so much that I really can’t answer too many of their concerns except a few of them.

Motion agreed to.

Ordered for standing resources development committee.

MILK AMENDMENT ACT

Hon. W. Newman moved second reading of Bill 103, An Act to amend the Milk Act.

Mr. Riddell: The amendments to Bill 103 are simply in keeping with the amendments to Bill 102.

Mr. Foulds: Mr. Speaker, our caucus discussed this bill very fully and we are in support of the bill, as we were of the previous one because it does essentially the same thing, only it makes it uniform throughout the marketing procedure.

Motion agreed to.

Ordered for standing resources development committee.

AUDIT REVISION ACT

House in committee on Bill 43, An Act to revise the Audit Act.

Hon. Mr. McKeough: Mr. Chairman, I have amendments to section 10 and section 11.

Mr. Chairman: Are there any comments or discussion on any section prior to section 10?

Mr. Germa: Mr. Chairman, I would like to present an amendment on section 9.

Sections 1 to 8, inclusive, agreed to.

On section 9:

Mr. Chairman: Mr. Germa moves that section 9 be deleted and the following be substituted therefor: “The Auditor shall audit, on behalf of the Assembly and in such manner as the Auditor considers;

“(a) The accounts and records of the receipt and the disbursement of public money forming part of the consolidated revenue fund, whether held in trust or otherwise;

“(b) The accounts and financial transactions of all agencies of the Crown and the accounts and financial transactions of all Crown-controlled corporations.”

Mr. Germa: Mr. Chairman, this particular amendment was discussed in committee. It is subject matter which has been discussed, not only in this Legislature but Legislatures throughout Canada, and throughout the entire world in fact.

The intent of the amendment is to require that the Auditor shall be the auditor for all Crown corporations and Crown agencies. I think there is a good principle involved here, that an auditor who is auditing public moneys is a different kind of cat to those auditors who are auditing private funds. I think their terms of reference are different. I think their objectives are different, and for that reason -- I think the amendment should be given serious consideration.

The House of Commons, of course, recently has reversed its decision, but the House of Commons public accounts committee was of the opinion, since 1969, that the Auditor General should, in fact, be auditing all accounts of the federal government. They have recently changed their opinion, of course, but it is not a unanimous opinion, so that anyone’s opinion is valid. I believe that the auditor of public accounts should not be the auditor in the private sector. This is precisely what we have here right now.

In fact, one of the biggest Crown corporations in the world, Ontario Hydro, is now audited by a private auditor who applies commercial standards to the audit of public funds. There is a long history to dictate that this is not proper and that the person who audits public funds should not be connected with the commercial world whatsoever.

It is with this intent in mind that I present this amendment. There is a large body of opinion, and if we go to other jurisdictions we find in many areas, such as West Germany and Israel and the United States, and various other areas, that all publicly controlled corporations, Crown corporations -- they are called by different names in different jurisdictions -- the Crown auditor audits the expenditure of all public moneys.

There is a new concept in the bill, I think, which requires and gives further strength to my proposal that the Provincial Auditor should audit all Crown corporations. It is the new concept in the Audit Act which requires that value for money shall be a consideration when the Auditor is doing his audit; this is a new concept.

Up until this point in time, the Auditor was only required to go through the jiggery-pokery of adding and subtracting figures and making a statement that, in his opinion, the figures represent a true picture of the financial situation of the corporation. Now under the new Audit Act, he is required to make a determination that value for money has been received. It escapes my comprehension that you are going to be able to train 5,000 or 6,000 private auditors to this new concept of value for money. It is going to be difficult even for the Provincial Auditor, to come to some conclusion on how he can evaluate that the province has received good value for money expended. It is a whole new concept in the audit principle.

I think if we are going to measure value for money, and this whole new concept, we are going to have trouble -- even the Provincial Auditor is going to have trouble. Surmising that any other accountancy firm working in the private sector, which does not have to take that into consideration, is going to have the expertise; such a thing just escapes me.

If we expect the new Audit Act -- and a lot of us have great expectations for it -- to bring a new level of scrutiny to public spending, that we would expect private auditors to also accomplish this same expertise is unrealistic. That is an added factor to why I move the amendment that the Provincial Auditor should, in fact, audit all Crown corporations.

[5:30]

Now on the federal scene, while they haven’t accomplished this, the Wilson committee, which studied accounting practices in the federal sphere, did recommend that those Crown corporations whose expenditures had an effect on the consolidated revenue fund should be audited by the Auditor General, which means to say that those corporations which are working in the commercial field and do not need transfers of money from the consolidated revenue fund are exempt from the Auditor General. Well if that concept is valid, then I suggest the other concept is valid, that where any public dollar is spent, be it by transfer or by arm’s length commercial corporation, the Provincial Auditor, as a responsibility to the electorate of Ontario, should have it in his power to take a look at those audits.

Certainly there is provision in the new bill that the private auditor shall report to the Provincial Auditor, but that is not enough. There is even some concept of conserving public funds in the expenditure on public audit. In the case of Ontario Hydro, I think, we were told at the committee level that we are spending in excess of $145,000 on private audit. It is my impression that these functions could be accomplished at greater savings to the public purse, and to my mind, it would better serve to ensure that good value is being received for the public dollar being spent.

Mr. Reid: As chairman of public accounts, I wonder if I could make a few remarks previous to addressing myself to section 9 and the amendment placed by my friend and colleague from Sudbury.

Mr. Chairman: I would remind the member for Rainy River that we are discussing the amendment to section 9.

Mr. Reid: Right. Well, I am going to do that, Mr. Chairman. I was just going to say we have had rather a thorough go at this in the committee of the whole, with all members of the committee there, as well as the Treasurer and the Auditor. It was discussed at great length; this motion was put then and was defeated by the members of the committee.

I would say that there didn’t seem to be any real, concise, and firm stand taken by our colleagues in Ottawa as to whether all of these matters should be placed under the jurisdiction of the Provincial Auditor, or whether or not in fact there were benefits to accrue to the province of Ontario and the Provincial Auditor in having some of these agencies and Crown corporations come under the audit of what we commonly call the private sector. It seems to me there are a number of advantages to having outside audits, for want of a better word, in that the commercial firms or the private sector firms are probably going to bring a different perspective and a different approach to the audit of these Crown corporations and Crown agencies.

It seems to me that, particularly under section 9, this is the most comprehensive public Audit Act in Canada, --

Hon. Mr. McKeough: Hear, hear.

Mr. Reid: -- including the federal government. The provisions under section 9 more than guarantee that the Provincial Auditor of the province of Ontario has access to all the information that will be provided by the private sector auditors, that if he’s not satisfied with the information that he does receive under section 9, subsection 4 and the previous sections, that he has, in fact, the authority to get all the information that he so requires.

I have a particular bias that I must admit to in this regard, and that is that I don’t believe that the government should be doing everything, or in fact that we require that everything has to be under the direct scrutiny of the civil servants employed by the province of Ontario. I think the knowledge and the perspective to be brought by outside auditors to the operations of these Crown agencies and corporations, who do not act as ministries of the Crown, who in many cases operate on the basis of a commercial operation, is a very healthy thing.

I would be prepared to support the amendment as put by my friend from Sudbury if the Auditor did not have the powers under section 9 that he does. But under section 9 he has the ability and the authority to ask for all the documents, to ask for the audit as done. If he’s not satisfied with that, he can request further information and do an audit of his own if he’s not satisfied with what he has.

We had a lengthy debate on this matter. My position has not changed. Perhaps sometime down the road circumstances will change and the provisions as put forward by my friend from Sudbury will be placed in the Act. But at this moment I think the provisions to section 9 more than sufficiently protect and guarantee to the people of the province of Ontario that their tax dollars are being spent as they should be. With that, Mr. Chairman, and because we have had a full debate on this matter, I will say that this party cannot, at this time, accept the amendments as put forward by the member for Sudbury.

Mr. Warner: It’s very disappointing.

Mr. Makarchuk: Mr. Chairman, most of what has been said has been said before, but I think we have to put on record that one of the reasons this amendment is moved is to provide or give the Legislature some power or leverage to examine the books of Ontario Hydro, to examine the spending of Ontario Hydro. I’m amazed that the Liberal Party, on the one hand has been making a great issue in the question period about Hydro, and on the other hand when possibly you have an opportunity to examine the spending and accounts of Hydro you back off on it.

This is the reason we feel on this side, that the commercial auditors have certainly one set of standards; that they operate on the basis that there has to be a voucher for everything; that money has to be spent and something has to be received. When you start talking about whether you bought the uranium for a proper price, or whether some other things have been spent, I feel that a commercial auditor will not be able to give us that kind of information.

I also feel that when that information is fed second-hand to the Auditor, a lot of it can be overlooked, not intentionally and not necessarily be concealed, but it could possibly escape scrutiny, That’s the major reason for this amendment.

Public spending is a matter of urgent concern to the people outside this Legislature. It gives the members, for the first time, a direct opportunity to question the spending and whether we’re receiving value for the money spent by Ontario Hydro.

The members, particularly of the public accounts committee, would then have the assistance of the Provincial Auditor with all his staff and his expertise that can be asked to assist either some committee of the House or the public accounts committee with the examination of the spending of this firm. We always have the Provincial Auditor available to us; I question whether we can have the private auditor available to the committee to answer questions. It is for these reasons we intend to vote for the amendment. It is a very important amendment. If this House has any sense of accountability for how money is spent we have to deal directly with it ourselves. No one else is going to answer for us.

Mr. Nixon: I want to refer briefly to the amendment put forward. It has an attractive ring to it until you compare it with the amendment put before the House and discussed in detail in the public accounts committee. Because in section 9 of the bill approved by the committee, it’s clear that while the Auditor does not have the direct responsibility to audit the many government agencies and corporations, the Auditor has a clear power to get whatever information he in his wisdom may require in order to examine the expenditure procedures in these agencies and corporations.

I would simply like to read you part of the subsections, indicating what information is needed from these corporations and agencies not now directly audited by the Provincial Auditor. Subsection C says:

“They shall provide forthwith to the Auditor, a full explanation of work performed, tests and examinations made and the results obtained, and any other information within the knowledge of such person or persons in respect to the corporation.”

I would like to draw to your attention as well that the Auditor, while he’s a servant of this House and under the direction of this House, normally receives his instruction in that regard from the members of the public accounts committee. That committee has an opposition chairman and representatives from all parties. I feel some satisfaction that the provisions of the bill before us do give good and sufficient powers, not only to the Auditor, but to the House and to the public accounts committee.

I hope I am not proved wrong. I personally am quite confident that any arm of government, its agencies or corporations, can be examined in any detail the Auditor feel necessary; if it doesn’t come to his attention, and arises perhaps even as a political issue, the political party concerned can use the public accounts committee as the vehicle whereby the Auditor can be advised or even instructed to make whatever inquiries might be necessary. I feel the democratic safeguards are in this way provided by the provisions before us, without supporting the amendment that has been put by the member for Sudbury.

Mr. Makarchuk: A brief point with regard to what the member for Brant-Oxford-Norfolk said: I think what he said applies when you have a majority of opposition members on the public accounts committee. They can then direct or ask the Auditor to do certain things. However, when you don’t have the majority, or have a situation as existed before the 1975 election, a lot of things can be blocked and the kind of examination you want can possibly be prevented. You could not obtain the answers --

Mr. Nixon: I don’t think that shows much confidence in the Auditor.

Mr. Makarchuk: -- for the simple reason that you perhaps are not going to be examining that aspect of whatever concerns some members of the opposition.

Mr. Reid: I take a bit of exception to what the previous speaker said the first time he spoke and now. He seems to indicate we in the Liberal Party are not as concerned about these matters as perhaps we should be.

Mr. Foulds: Exactly right, you aren’t.

Mr. Reid: He referred specifically to Hydro. If he would take the time to read the bill carefully, he would see those safeguards are there. We went through this in some detail during committee stage before the standing public accounts committee. The Auditor indicated he would have to hire additional staff; he couldn’t tell us exactly how many more people would be involved.

[5:45]

I admit to my bias. I would prefer to see some of this in the private sector. I think you get a balance this way. Surely if I felt for one moment that information was not going to be made available to the Auditor, and certainly to the public accounts committee -- I think my friend is a little naive when he talks about a majority government, and there will be a majority government after the next election, and it will be a Liberal majority government.

Mr. Foulds: That’s what we need protection from, Mr. Chairman, that’s exactly what we need protection from.

Mr. Reid: I’m certainly glad my friend from Port Arthur agrees it will be a Liberal majority government he’ll need protection from, I appreciate that comment.

Mr. Foulds: They are more Fascist than those over there.

Mr. Reid: But surely part of the safeguards in a democratic system is that certainly the majority rules, but the opposition opposes; and the fourth estate -- the press -- is there.

Mr. Nixon: That’s a question for debate.

Mr. Reid: Well, we won’t go into that at the moment, but they are there. There is a good and valid point that those democratic safeguards, as my friend from Brant-Oxford-Norfolk says, are in place. So really, I think the arguments from the last speaker from the NDP are a bit facetious.

Mr. Germa: I think it should be put on the record that in fact the opinion as expressed by the previous speaker was not a unanimous opinion from the members of his caucus. There was at least one member of the committee who was in support of the proposition for the specific reason that he wanted to get more information from Hydro. He was in support of such a proposition that the Provincial Auditor and the public account committee should have access to the expenditures of Ontario Hydro. It was on the strength of this alone that he was in sympathy with this proposition. The words of the last speaker are just full of holes. It is not a unanimous opinion.

Mr. Foulds: That’s putting it mildly.

Mr. Germa: Yes, Let me add this to my argument. Take a look at what other countries do, countries which have more experience, such as older European countries where governments have been dealing with this subject matter for a thousand years; we’re only babies as far as government expenditures are concerned.

Mr. Reid: Would you suggest a committee to go there?

Mr. Germa: We’re babes in the wood as far as these other countries are concerned. In fact, as far back as Aristotle -- and that’s going some way back --

Mr. Foulds: Almost as far back as the Treasurer.

Mr. Germa: -- people were concerned about the audit of public funds. I’d like to read this quote from Aristotle: “Inasmuch as some of the magistracies handle large sums of public money, there must be another office to receive and account and subject to audit, which must itself handle no other business, and these officials are called auditors by some people, accountants by others, examiners by others, and advocates by others.”

So it goes as far back as Aristotle that people were concerned about audit of public funds. They felt these people should have no connection whatsoever with any other jurisdiction. They have to be totally and absolutely independent and unbiased, and they must pursue their own method. I assert again that the method of accounting public funds is entirely different from auditing private funds.

I am going to take you on a trip around the world to show you just what is happening in other jurisdictions. In Great Britain, for instance, the Wilson committee report of March 1975, says -- and I am quoting -- “The Comptroller and Auditor General is required by legislation to examine and certify the annual appropriation accounts and other accounts of government departments and certain other bodies and report them to Parliament.”

As far as I am concerned, Great Britain has closed the bottom of the bag and all accounting is done by the public auditor,

As far as the United States is concerned, auditing is done for all government corporations, which indicates that every public dollar spent in the United States is audited by a public auditor, by a state auditor or an auditor general.

In the case of Australia, and -- I am quoting: “Under the Audit Act, the Auditor General is responsible for the audit of the accounts of the Treasury and all departments. His responsibilities for the audit of statutory authorities, Crown-owned companies and other government organizations are assigned under the specific provisions of enabling legislation by appointment under ordinance, by appointment under the relevant Companies Act or by arrangement with the minister or other authorities.”

So it appears that Australia has also closed the net very tightly.

Austria has also closed the bag. “First, the audit function has been extended from a concern for government departments alone to the inclusion of state-owned enterprises and publicly subsidized commercial operations.” It includes, there, anyone who receives a government grant.

In the case of Israel -- and that certainly isn’t a very old nation compared with ours:

“The state controller is required by law to inspect the finances and the management of the finances and the property administration of the bodies subject to his inspection; that is, the ministries, the defence establishment, state enterprises and institutions, local authorities, corporations in whose management the government or other inspected bodies have a share, and other bodies placed under his inspection.” So in Israel the jurisdiction of this man is quite wide.

South Africa also has the same provision; and the Federal Republic of Germany as well. So there is a wide consensus right around the world that this is a good concept, I’m surprised there is any resistance whatsoever to this whole idea.

Mr. Chairman: Mr. Minister; no comment?

All those in favour of Mr. Germa’s amendment will please say “aye.”

Those opposed will please say “nay.”

In my opinion the nays have it. I declare the motion defeated.

Section 9 agreed to.

Hon. Mr. McKeough: Mr. Chairman, I have amendments on sections 10 and 11. I’ll read them. They have the effect in both cases of adding the words “in every Crown-controlled corporation.” Do you want me to read them or can I dispense?

Mr. Chairman: They should be read.

On section 10:

Mr. Chairman: Hon. Mr. McKeough moves that the bill be amended by deleting section 10 and substituting the following: “Every ministry of the public service, every agency of the Crown and every Crown-controlled corporation shall furnish the Auditor with such information regarding its powers, duties, activities, organizations, financial transactions and methods of business as the Auditor from time to time requires. The Auditor shall be given access to all books, accounts, financial records, reports, files and all other papers, things or property belonging to or used by the ministry, agency of the Crown, or Crown-controlled corporation necessary to the performance of the duties of the Auditor under this Act.”

Mr. Reid: I have one comment, Mr. Chairman. I’d just like to make it clear that these amendments in regard to every agency of the Crown and every Crown-controlled corporation -- we had some discussion about this in committee and as far as I am aware, these matters also refer to section 9 and are covered by subsection 3 of section 9. So the bill is standard throughout and these matters refer to every agency of the Crown and every Crown-controlled corporation.

Motion agreed to.

Section 10, as amended, agreed to.

On section 11:

Mr. Chairman: Hon. Mr. McKeough moves the bill be amended by deleting section 11 and substituting the following: “For the purpose of the exercise of his powers or the performance of his duties under this act, the Auditor may station one or more members of the office of the Auditor in any ministry of the public service, in any agency of the Crown, and in any Crown-controlled corporation, and the ministry, agency or corporation shall provide such accommodation as required for such purposes.”

Motion agreed to.

Section 11, as amended, agreed to.

Mr. Chairman: Are there any further comments or questions on any other sections of the bill?

Sections 12 to 32, inclusive, agreed to.

Bill 43, as amended, reported.

Hon. Mr. McKeough: May I thank the members of the public accounts committee. We really did have very good sessions on this bill. Everything that was said this afternoon was said in committee. It is always nice to hear sterling words again; but in any case it was well said in the committee too. We had the co-operation of the Auditor and of the Institute of Chartered Accountants. It was a good discussion. I think we passed a good bill.

On motion by Hon. Mr. McKeough, the committee of the whole reported one bill with amendments.

OXFORD MUNICIPAL HYDRO-ELECTRIC SERVICE ACT

Hon. J. A. Taylor moved second reading of Bill 111, An Act to provide for Municipal Hydro-Electric Service in the County of Oxford.

Hon. J. A. Taylor: Mr. Speaker, this bill is the third in a series of statutes which will improve the efficiency and effectiveness of the distribution sector of the electrical supply system in Ontario. It follows the recommendations of the government committee on restructuring of public utilities, as amended by my statement of July 8, 1977.

The bill establishes a new municipal electric power supply commission for each of eight area municipalities in the county of Oxford. Thirteen existing commissions are dissolved. Because of the low population density and growth rate in Oxford, customers within the five townships presently served by Ontario Hydro will continue to be served by Ontario Hydro. This interim arrangement will be reviewed every five years by a committee appointed by the area municipalities as recommended by the local study team.

In other respects, this bill is similar to two bills passed by this House on July 12, 1977; namely, the Waterloo Electrical Service Area Act, 1977 and the Peel Municipal Hydro-Electric Service Act, 1977.

Mr. Nixon: Mr. Speaker, we have no objection to this bill, other than a feeling that I have that the same results might have been achieved without establishing PUCs in each of the lower-tier municipalities in the restructured county.

I feel that we might well have enabled the residents of the urbanized area around Tillsonburg, and perhaps certain other communities, to have been served at the lower rate without establishing the PUCs. But I suppose, as the minister has pointed out privately, this does give a certain flexibility that will meet the needs of the community in the future.

I have canvassed the area, or at least spoken to the officials in the area which I have the honour to represent, and they have expressed no objection.

Mr. Swart: Mr. Speaker, I will take about 10 minutes. Do you wish me to start now or do you wish me to move the adjournment?

Mr. Reid: Don’t ruin our supper.

Mr. Swart moved the adjournment of the debate.

The House recessed at 6 p.m.