Legislative Assembly of Ontario

The House resumed at 8:02 p.m.

INTERIM SUPPLY

Hon. F. S. Miller moved that the Treasurer of Ontario be authorized to pay the salaries of civil servants and other necessary payments pending voting of supply for the period commencing April 1, 1979, and ending June 30, 1979, such payments to be charged to the proper appropriations following the voting of supply.

Hon. F. S. Miller: Mr. Speaker, I make the comment that we have changed the period to three months. It was intended to be three months; by some error it became six months. I have understood that in the past the House has not been generally willing to extend the period to six months. Rather than argue, we settled for June 30.

Mr. Peterson: The Treasurer is quite right, Mr. Speaker. We prefer shorter periods than sometimes has been demonstrated in the past; that is why we have a preference for three months. It gives us all a wonderful opportunity to go through this enlightened debate on a far more regular basis.

I am highly tempted to vote against this motion tonight, and I would, except for the fact that I have to make a speech at 8:30 to a very enlightened group, the High Park Liberal Association. If I had the time, I would definitely stay here, and we would fight this on its merits. However, the High Park Liberal Association has saved the Treasurer for at least another three months, depending, of course, on what he does in a couple of weeks.

Hon. Mr. Norton: Who is your speech writer? Jim Taylor?

Mr. Peterson: The honourable minister just made a noise. Does he have something worthwhile to contribute? Jimmy Taylor is writing my speeches, that’s right.

In many ways this debate is irrelevant because we will soon be into a very major debate on the budgetary policies of this government, whatever they are -- it’s been impossible to decipher them for the past six or nine months since we’ve had the new Treasurer. Really, nobody knows what this charming little squirt is up to, for sure.

Mr. B. Newman: Not even the minister.

Mr. Peterson: We have seen some gratuitous handouts to various people with no particular strings attached -- with no particular conditions that we understand.

Mr. Hennessy: It’s only the start.

Mr. Peterson: There’s been a sort of ad hockery brought to this whole process that to any intelligent observer is almost incomprehensible. I’m almost tempted to allow the supply to go through for civil servants because I know the good deputy minister Rendall has been working very hard to try to make this man appear at least a little bit legitimate. But I would almost be tempted to move an amendment deducting the government politicians’ salaries from this and let the civil service be paid in the normal course of events.

Mr. Hennessy: He’d have a heart attack.

Mr. Peterson: I wish you’d stop the interjections over there, Mr. Speaker, because I have several things that are important to say.

Hon. Mr. Welch: Will you let us know when you start?

Mr. Peterson: Look at them: the two senior government ministers sitting there, the two diminutive ministers sitting there, looking for all the world like two cheeks of the same behind. Look at them.

If you accept my thesis, what does that make the Premier (Mr. Davis)? I guess you’d have to ask that. Look at them. They laugh at each other’s jokes; they really enjoy each other, it’s quite obvious.

Mr. Speaker: I think the honourable member really is getting a little carried away.

Mr. Hennessy: That’s right.

Mr. Peterson: I’ve been provoked, Mr. Speaker.

Mr. Speaker: It has nothing at all to do with supply.

Mr. Peterson: I have been provoked. You can see that. They’re trying conscientiously to provoke me. A little bit like the Premier --

Hon. Mr. Walker: He sounds like the south end of a northbound horse.

Mr. Hennessy: It’s a supply of B.S.

Mr. Peterson: -- sometimes I get provoked and I launch into little diatribes.

Anyway, I’m sorry my time is almost up because I do have to get into my car to go to High Park. We will support the motion now. The House will hear a great deal from us in a week or two or three, whenever the appropriate time is.

I can say to the Treasurer very seriously, we are looking forward with great expectations to his performance on April 10. He has not felt rigorously bound to the dictates of the previous budget, he has altered principles substantially. It is a very difficult government to keep up to because it keeps switching ministers as it gets into trouble. I hope the present minister is able to stay there for at least a brief period of time to implement whatever he feels should be implemented in the next two weeks.

It is going to be incumbent upon him to make a little bit of sense out of these vague policies he has been putting to us and to the business community in the last little while. I’m referring to these little series of grants given on what basis God only knows, because we don’t understand them and I don’t really think he understands them and I don’t really think he knows the conditions of the pulp and paper grant situation because they don’t understand --

Mr. Sweeney: You guys don’t know very much, do you?

Mr. Peterson: -- and they don’t know if it’s viable, and the government doesn’t know if it’s viable, and nobody knows frankly what’s going on. The Treasurer has been a contributor to the crisis of confidence if there is one at all. I know he is going to say, “It was your friends in Ottawa.”

Mr. Breithaupt: Their friends in Ottawa.

Mr. Peterson: The people will have a chance to judge that in the very near future.

I just want to say this has been a wonderful opportunity to consume eight minutes of legislative time, and let me compliment the minister on his Muskoka tartan -- matching tie, jacket and boxer shorts. It’s a very handsome outfit.

Mr. Swart: Mr. Speaker, I too want to say, on behalf of our party, we’re not going to oppose this motion before us here this evening. However, I’m not going out to speak at any Liberal rally tonight --

Mr. Peterson: They would never let you.

Mr. Swart: No, I would doubt very much if it’s worth going the distance for the four or five people who will be there.

Mr. Ruston: Now the NDP have meetings in a phone booth.

Mr. Swart: Yes, but they’re growing very rapidly.

Because I do not have to attend anything else this evening, but more particularly because when the budget speech comes up there probably will be two or more members on this side of the House who will want to speak in the budget debate, and therefore I may not be able to be worked in, I want to say a little about the issues involved in this resolution that we have before us this evening.

It is an all-encompassing resolution that we have, Mr. Speaker, as I am sure you recognize. It authorizes the Treasurer to pay salaries of the civil servants and other necessary payments; and that’s just about all-inclusive.

We cannot let this resolution pass without questioning the voting of money to administer policies with which we wholeheartedly disagree. We disagree with the Treasurer’s approach to the economy. We disagree with his restraint program, and certainly the application of it. The burden of this restraint program, which the government of Ontario instituted some three or three and a half years ago, is falling most heavily on those least able to pay, and I have no doubt that it was the deliberate intention of the government that this would be the case.

Shortly after I came into the House in the fall of 1975, there was a document tabled called the Special Program Review, the Maxwell Henderson report. I thought at that time, and I have come to be more and more convinced of it ever since, that that was the course the government was charting in the years ahead. Certainly the three years or three and a half years since that time have proved this to be the case.

Let me quote from this document in four places. It states in that document that the government should not at this time accept additional major responsibilities for public services but rather should explore the possibility of transferring back to the private sector some of the activities that it currently undertakes. That is a philosophical statement, and we all know, if we read between the lines, what that means; that some of the levelling process, some of the equality provided by the provincial government, shall be lessened.

They say the expenditures of the Ontario government as a percentage of the gross provincial product should decline. Of course, all of us in public life are anxious to see taxes go down, but I think we have to weigh that against the services that are provided to the public and examine whether a decline as a percentage will create greater inequality among the citizens of this province; of course, this is exactly what has happened.

They went on to make it very clear that that was what they intended to happen in this program review, as they called it. They stated, for instance, with regard to university and college education, that the level of government support should be gradually adjusted over a period of several years so as to allow an increase in the proportion of university and college costs covered by tuition fees. Again, this simply means that those in the lower income brackets, as we know, will be less likely and will have less opportunity to attend university.

With regard to health care, they recommended exactly what is taking place at the present time. They said consideration should be given to phasing out surplus beds and expensive treatment facilities in some hospitals, particularly those adjacent to urban centres, and public hospitals should be authorized to increase substantially the daily charges for private and semi-private accommodation. Then they went on to say this: “There [should] be a thorough examination of public hospital operating costs, with particular concentration on ways of reducing the total paid hours of the hospital staff.” Certainly we see that recommendation being followed today, with rather dire results for the people of this province.

[8:15]

They made the same kind of statements with regard to social security. The recommendation here is that the proportion of the provincial budget that is allocated to social security be lowered from its present level. We all know the advantage of social security is to the lower income groups, not the higher income groups; and by lowering the level of social security, of course, we are making the contrast between the wealthy in our society and the poor in our society that much greater.

Even with regard to municipal government and school board financing, they recommended that the province limit its support of school boards and local government generally to the available finances as defined in the Edmonton commitment. Implementation of this proposal will require modification of the existing open-ended cost-sharing formula; and then further recommendations with regard to the limitations of transfer payments to the various types of local government, whether they be school boards or whether they be municipalities or some other form.

Of course he even went on and made some even more radical, and I use that word advisedly, radical suggestions.

Mr. Wildman: Reactionary.

Mr. Swart: They said they should limit spending to programs that meet the needs of the whole population; that was one of the suggestions. Of course that would come out as those programs which serve only the needy in our society. They went on to say that medical insurance should be returned to the private sector, through PSI, Blue Cross and similar plans; at this time we see the very real possibility in Ontario.

They said they should recover the total cost of parks, day-care centres and similar facilities through user charges. Do not establish a provincial dental care plan or finance through the Ontario Lottery, and so on. It was about as reactionary a document as it would be possible to envisage at that time. I suggest to you, Mr. Speaker, that it is being followed rather closely at the present time.

I say to the government they simply tried to make a virtue of a regressive income redistribution in the name of restraint. They have done it; and in some degree they have been successful in getting away with it, because they have sold it as restraint, the action of a government that wants to cut back expenditure. I will have a little bit more to say about that in the very near future.

I want to repeat and give some documentation to the fact that what it has done is to shift the burden more and more on to those in the lower income brackets.

We are all aware, I think, that the consumer price index in the last three years -- and whether you take it from the end of 1975 to the end of 1978, or from March 1, 1979, to March 1, 1976, doesn’t make much difference, the cost of living in Canada has gone up about 26 per cent, and of course in Ontario perhaps even a little higher. But because the cost of the essentials, whether it is food or whether it is heating -- and incidentally oil and gas have gone up by about 150 per cent in those three years -- the essentials have gone up much higher, much faster, than the average cost of living. And of course those on the lower income have to spend a higher percentage of their income, as we all know, on those essentials -- food, heating, et cetera.

It should also be said that the cost really doesn’t increase by percentages, it increases by dollars and cents. Those with lower incomes, if they get a six per cent or an eight per cent increase in wages, in dollars and cents it is proportionately much less, far less.

So those increases in cost, as you well know Mr. Speaker, hurt those with lower incomes more. Not only do they have a higher percentage of increase in their cost of living, but because they have a low income to start with they are hurt a great deal more by it.

I want everybody to keep in mind that there has been an increase in the cost of living of something like 26 per cent in our society.

What has happened to minimum wages in this province during that three-year period? They have gone up from $2.65 to $3 a hour.

Mr. Wildman: And they have made a virtue of keeping them down.

Mr. Swart: Yes. That is a 13 per cent increase in the minimum wage. I don’t know what percentage of the population of this province is on minimum wage, but estimates have been made of about 20 per cent. Therefore, 20 per cent, if that is the case, or 10 per cent if it is only 10, have had their incomes go up by 13 per cent, while the cost of living has gone up by 27 per cent. Average wages and salaries, as I am sure most people here know, have gone up by about 31 per cent, which is just a little bit more than the cost of living, even although in the last year they have not gone up as rapidly as the cost of living. Those people on the minimum wage have seen more and more how low their standard of living has dropped.

What about those on general welfare? A family of four on general welfare back at the beginning of 1976 received something like $460, plus $20 per child for each one over the four. That has now gone up to $530, plus $25 per child, in a three-year period. That is an increase of 16 per cent compared to a 27 per cent increase in the cost of living. A single person on welfare has seen his allowance go up 14 per cent during that period compared to 27 per cent in the cost of living.

What about those on family benefits? A single woman with two children, ages five and 13 -- and this is averaging selective figures for 1976 -- was getting $368 maximum three years ago. Now she is getting $421 maximum. That is an increase of 15 per cent, while the cost of living has gone up 27 per cent and, in fact, more than that for those on lower incomes.

Mr. Cooke: The Minister of Community and Social Services (Mr. Norton) should be listening to this.

Mr. Wildman: He is not interested.

Mr. Swart: During that same period of time, profits have gone up 41 per cent. I say there is something wrong with a system that permits that kind of thing to happen in our society. That isn’t the only place where those in the lower income groups have been hurt. Let’s look at a few details on this. Let’s examine what has happened with regard to OHIP premiums. In this three-year period, as members are well aware, there would have been an increase of over 100 per cent if it hadn’t been for the fight that was put up by the two opposition parties. In fact, the increase in OHIP premiums was 72 per cent during this three-year period.

We now find the doctors who are opting out -- and there are a great many of them -- are charging something like 42 per cent more than they would receive from OHIP. Obviously, with this flat fee they may say that they themselves institute some sort of means test. I suggest a means test should be conducted on some sort of scientific basis and not by the seat of the pants, if I can paraphrase what the member for London North (Mr. Van Horne) had to say.

Even such things as provincial park fees have gone up something like 50 per cent in those years.

Mr. Wildman: They are not opening them as early either.

Mr. Swart: Automobile licences went up in 1977 by 40 per cent -- perhaps a little more on the average than 40 per cent. Once again, these flat fees hit hardest those at the lower income level. Old age pensioners and those with lower incomes by and large drive their cars only a fraction of the distance in any year that those with the higher incomes do -- somebody like myself -- and yet they have to pay that additional fiat fee to take their car out of the yard. I suggested there should be some graduated payment towards our road system and into government on this. They shouldn’t have increased those fiat fees in that manner. It would be much better to increase the gasoline tax than impose that high levy against them.

Perhaps the hardest cut of all has been against the property taxpayers, particularly those at the lower income level. Of course, back in 1973 or 1974 the commitment was given by the government of this province -- I’m not going to dwell on it -- called the Edmonton commitment, whereby the province was going to transfer to the local municipalities an increase of funds every year according to the increase in the amount of the general revenue the province received.

Mr. Wildman: Who eliminated that, Darcy Somebody?

Mr. Swart: Of course, they never lived up to that. Even while that commitment was still on the books, they never lived up to it. In 1974, there was a transfer increase made of 14.6 per cent; the actual increase in revenue that year was 19.5 per cent. In 1975, which was election year, the transfer increase was 24 per cent when the increase in revenues was 10.2 per cent. The year after the election, they took it back. They only gave a transfer increase of 7.7 per cent, while the revenue increased by 16.7 per cent. The following year the transfer increase was 7.2 per cent while revenue went up 10.7 per cent. Last year, the transfer increased by 5.3 per cent while revenue went up by 8.2 per cent.

The end result of this cutting back on the percentage of increase to municipalities has been that property taxes have increased, and increased quite dramatically. According to the government’s own figures and the book which it published on this issue, they showed in the three years from 1974 to 1977 the actual mill rates in this province went up 43.5 per cent. That doesn’t tell the whole story, because assessment increased somewhat because of people fixing up recreation rooms and so on. The government itself estimates that assessment, not from new assessment but upgrading of assessment, went up something like 1.2 per cent each year. So, in fact, the gross tax levy, on the average, to the property owners went up something like 47 per cent.

It shows up in the transfer for education. Whereas the province was paying something like 61 per cent of the cost of education in 1975, by 1978 that was down to 53 per cent. There was also a reduction in the transfer payments to municipalities as a percentage of the expenditures. That gross tax increase of 47 per cent in three years, or if we add last year to make it a four-year period, runs to about 57 per cent, which is bad enough in itself.

But the point I want to make here is that tax, because of a variety of factors which the government failed to correct, fell most heavily on those least able to pay. All of the studies that have been done across this nation show the property tax by itself is an extremely regressive tax. It falls most heavily on those in the lower income brackets. It is obvious why that is the case. Over the years, the provincial governments across this nation, including Ontario -- I give them credit for it up until about 1974 -- were transferring enough moneys to the municipalities, an increased amount of moneys to municipalities, so the incidence of the property tax was being relatively reduced.

[8:30]

Then, at about the time this document came out, there was a dramatic change, and they started to put more and more of it on the property tax. One of the methods the government had used to make the property tax less regressive, was the property tax credit related to income. A person who was the occupant of a house received a credit on his taxes or on a portion of rent which he paid related to tax. But since 1975 that has not been increased and the result is that once again the regressive nature of this tax has not only been maintained but it has increased very dramatically.

Let me give you, Mr. Speaker, and through you the minister -- and I hope he will deal with this when he gets up -- examples of what has happened. These figures are taken largely from his own documents.

A person who paid $500 in taxes on property in 1974 and had an income of $5,000, received a property tax credit of $253. If he had $7,500 income he would have received a property tax credit of $205; a $10,000 income a property tax credit of $155.

Hon. F. S. Miller: Those are taxable incomes.

Mr. Swart: The increases in those provide that that same person now would be getting $282 where he got $253, $246 where he got $205, and $198 where he got $155. But what has happened to the taxes? The tax that was $500 would now be $717.50; that’s the increase in three years, it went up from $500 to $717.50.

So the net tax that the person with a $10,000 income paid went up from $345 to $519, an increase of 50 per cent. At $7,500 income that property tax credit went up from $295 to $471; and in the $5,000 range the net tax went up from $247 to $435. In three years the net property tax increased 75 per cent.

That’s bad enough. That’s the case of a person who wasn’t an old age pensioner. But if he was an old age pensioner he would have got back, in 1975, $110 additional tax credit; and that still is $110 today. It means that that old age pensioner, in that tax bracket that I speak of, at $10,000, has had an increase of 74 per cent in three years; if he’s in the $7,500 tax bracket it’s 95 per cent; and if he’s in the $5,000 income bracket his tax increase in those three years was 137 per cent.

Mr. Wildman: Shameful.

Mr. Swart: That’s the kind of shift there’s been for those least able to pay in our society.

Mr. Warner: Miserable, miserly Miller.

Mr. Swart: There’s all kinds of evidence that the restraint program is hurting most the low and the low middle income groups. I want to take this opportunity to call on the Treasurer, and through him his government, to utilize the staff to produce a restraint-impact study so we know where the burden of restraint is falling. I think that’s a fair and reasonable request. We should know. The government should table documents to show us where the burden of restraint is falling; and it’s not on those in the wealthy income bracket.

Mr. Warner: Show us who you are hammering.

Mr. Swart: We oppose the restraint program, as I’ve already said, on two grounds. First, because of its unfair application; I’ve already dwelt on that at some length. Second, because of the very principle of the restraint --

Hon. F. S. Miller: Could we deal with interim supply? I have my estimates on tonight.

Mr. Speaker: I was getting the impression that the member for Welland-Thorold was going pretty far afield, given the motion that is before the House.

Mr. Warner: But it is interesting, Mr. Speaker, most interesting.

Mr. Swart: I’m just concluding, but you would realize that this resolution covers all phases of expenditures and, in fact, covers the whole program. We are opposed to the restraint program because all the emphasis has been put on restraint. That’s the only economic policy the government has. It should be taking those step towards an economic strategy for Ontario so we have full employment.

Last year’s Treasurer -- and I seldom quote from last year’s Treasurer -- pointed out in his budget report reassessing the scope for fiscal policy in Canada that if we employed only 68,000 more people the revenue to Ontario would increase by $858 million. Think what we could do. We’d have $1 billion more revenue in this province if we put approximately 200,000 people to work. I’m quoting from the Treasurer’s own document. I know he’s qualified it and tried to put other arguments to us that it wouldn’t be valid, but that’s what it says with regard to full employment.

Mr. Warner: We know what your economic strategy is: Supply rowboats to people on the Titanic.

Mr. Swart: As I have said, we’re not going to oppose this motion we have before us, but it seems to us in this party that we have to take every opportunity we can at this time and from here on to show what is really happening in this province because of the restraint program. We break completely with what the Ontario government is doing. We think we can have full employment if we have the right policy, and we think we can have fair sharing.

I want to state as strongly as I can that at a time when we are in restraint and when there’s less to go around that is all the more reason we should share it fairly rather than take it out of the pockets of those least able to pay.

Mr. Charlton: I’ll just take a few moments to talk about a number of things that I see in this interim supply motion and in the overall picture of government spending which bother me a little bit. I want to talk for a few moments about the present program of the Ministry of Revenue, and section 86, equalization.

Hon. F. S. Miller: On a point of order, that has nothing to do with this.

Mr. Speaker: Let me hear what he has to say.

Mr. Charlton: The program to which I’m referring is the program by which the Ministry of Revenue has opted out of its responsibility for which it’s been spending taxpayers’ money for the past 10 years, the program of providing property tax reform for this province, the entire province.

Mr. Speaker: With the greatest of respect, if you’re going to get into the programs of a specific ministry of this government I think you are going a little far afield. We’re talking about interim supply for the purposes of carrying on government from now until the end of June. If you want to be all-encompassing and make some general remarks about the fiscal policy, that’s fine; but if you want to deal with a specific program, there’s a proper time and a proper place for that and it isn’t here.

Mr. Charlton: Let me try to make it as general as I can. What I was attempting to talk about was government spending. I wanted to use some examples of that.

Mr. Wildman: What about the Sault jail?

Mr. Charlton: What I wanted to talk about was a situation where we’re here tonight voting interim supply, which includes all the salaries of the civil service and all of the other costs of government programs and so on.

In the example I wanted to cite we have spent 10 years’ worth of money -- nobody even knows how much -- and we have accomplished absolutely nothing. The Ministry of Revenue has spent money. The Ministry of Treasury, Economics and Intergovernmental Affairs has spent money doing studies. We have had the Blair commission. We have had a number of other examples of money spent, and we have had no results at all.

We are back to a situation now where the Premier says that the government is not trying to pass the responsibility for property tax reform back to the municipalities, and yet this province, although it has spent in now three different ministries and a couple of commissions and studies --

Mr. Speaker: You can’t talk about money that has already been spent We’re talking about the money that will be spent.

Mr. Charlton: They’re still spending it, Mr. Speaker.

Mr. Speaker: No. We’re talking about the money that will be spent. You’re talking about the past.

Mr. Charlton: I am doing what has been done in the past to talk to this resolution to spend it again, Mr. Speaker. The situation has not changed since last year or the year before. The only thing that has changed is the government’s willingness to move on with effective property tax reform. They are still spending the money. It is still a part of this motion of interim supply. It is still a part of the budget this year. The government is still spending all of the moneys and playing all of the games with that money that it spent in the last 10 years of playing. That is the whole point of what I am trying to raise this evening. It is the approach that this government, in terms of its restraint program --

Hon. F. S. Miller: Did you ever refuse to cash your own pay cheque when you worked there?

Mr. Charlton: At the point when I worked there, I say to the Treasurer, I do recall the program having been postponed indefinitely.

Hon. F. S. Miller: It is only as good as the employees we have.

Mr. Wildman: That is about as cheap as the Treasurer’s taste in clothes.

Mr. Charlton: That is a very cheap shot the minister just took at the civil servants who work in the Ministry of Revenue, because the civil servants have done an excellent job. The money they have received was paid for extremely well done work. The problem lies with the present minister, the prior minister, and many of the Ministers of Revenue. The problem is not the civil servants and the job they have done; the problem is the political games that have been played by the ministers across the way in the cabinet and in the government caucus.

The whole point of the discussion is that we are no further ahead now than we were 10 years ago, and we are progressing into probably another 10 years of expenditure for the same thing.

The problem in the municipalities is that the property taxes get worse every year; at the same time, as my colleague has mentioned, the government has gone through and is in the process of making cutbacks or reductions in the grants and transfers to municipalities. It is just not in the best interests of the people of this province. The taxpayers of this province have not been well served.

The whole program has left this province in a situation which I think is being quite aptly reflected in the press in the 13 municipalities where the government has opted out and the municipalities have taken action on their own.

Mr. Speaker: The honourable member is being far too specific.

Mr. Charlton: I’m sorry, Mr. Speaker.

Hon. Mr. Walker: That comes in a later vote.

Mr. Charlton: The taxes the people have been forced to pay at the municipal level right across this province have reached proportions which are simply astronomical. The situation is reflected, I think, by the outcries of those who now are finding out what the average levels in this province really are because, for whatever reason they have been underassessed. They are being put in a situation now which results directly from the government’s restraint program, which has forced property taxes so high that they are having to look at property tax levels that they just didn’t know existed.

[8:45]

We are not going to vote against this motion of interim supply, because there are so many people involved in it, but I think it’s important the government understand that the policies it has followed in a number of areas and the way it has used taxpayers’ money to absolutely no avail or to no benefit of the taxpayers of this province, is just disgusting.

Hon. F. S. Miller: Mr. Speaker, I really have no other comments to make.

Motion agreed to.

House in committee of supply.

SUPPLEMENTARY ESTIMATES, MINISTRY OF COMMUNITY AND SOCIAL SERVICES

On vote 2802, Social resources program; item 2, income maintenance:

Hon. Mr. Norton: Perhaps, Mr. Chairman, I will make just some brief opening remarks.

The supplementary estimates for which I am seeking approval from the committee at this point total some $14.6 million, all of which is in the income maintenance provisions of the budget of our ministry. The explanation, in brief, for the supplementary estimates, relates to the six per cent rate increase which was approved for January of this year. That accounts for a substantial amount of the $14.6 million. The increase in the cost of the drug benefit plan for the recipients under income maintenance programs in the province accounts for part of that as well. The third significant factor was the deficit which we experienced in general welfare assistance as of the end of the fiscal year.

I wanted to make those brief comments. Perhaps the honourable members opposite have some comments to which they would like me to respond later.

Mr. Blundy: Mr. Chairman, there is no way we, in this party, will vote against the supplementary estimates before us this evening. Obviously, the people who are to benefit from them need our support at this time. Of course, we as a party do provide support to the minister in these supplementary estimates.

It is obvious to me that the matters of unemployment and inflation that are being felt by the people who are serving the recipients in the municipalities are such that these amounts for these benefits do have to increase; we recognize that.

The six per cent rate of increase to which the minister alluded a few moments ago was certainly long overdue and I am not going to go into the specifics of these supplementary estimates. We look forward to the opportunity, later on in debating these matters, to discuss the many matters which have come to our attention since we last did the estimates, and we will go into that in great detail at that time.

Right now I want to say to the minister that we certainly want to see the people who are in our lowest income brackets in the province, and particularly those people who are unable to help themselves, continue to receive the benefits we have been providing. As a matter of fact, when I look at how much it costs to live now, with the increases we have had in general household expenses, such as heat and light and municipal taxes, which have been referred to here tonight, I wonder how some of these people ever manage on the amount of money that is being provided to them.

With those few remarks, Mr. Chairman, I want to assure the committee of our concurrence with the supplementary estimates. I want also to assure the minister that we are going to be ready to go after him in much more precise terms in the coming estimates.

Mr. McClellan: I have to confess that I am a little confused about the figures in the supplementary estimates before us. Perhaps I would be better served if I were to ask the minister to give us a little more explanation about the details of the $14 million being voted.

My assumption is -- and maybe the minister will correct me if I am wrong -- that the bulk of the sum is not for increase in benefits granted, but rather for increase in the general welfare assistance caseload. That was certainly my interpretation of the figure which shows $11 million of the $14,600,000 being allocated for municipal allowances and benefits.

Could the minister indicate to us how far off his forecast of general welfare assistance caseload was during the estimates last fall? In the briefing book, the programs and resources summary, the minister anticipated that there would be a total of 140,000 beneficiaries on general welfare assistance for the 1978-1979 fiscal year. I would ask if he could give us an update, either in terms of beneficiaries or in terms of cases; that is the difference between the forecast and what the actual caseload appears to be, what the breakdown of the supplementary estimates is between moneys allocated for the increase on the benefit level and moneys allocated as a result of an increase in people on general welfare assistance?

Hon. Mr. Norton: I will attempt to respond to the honourable member’s questions.

The general breakdown between the portion of the $14.6 million attributable to rate increase and what is attributable to deficits would be approximately this: About $7.2 million of that is attributable to rate increase for the portion of the fiscal year between the timing of the increase and the end of March; about $7.4 million is attributable to deficits.

I don’t have in front of me, but expect shortly, the specific amount in terms of projections and actuals. I might point out that in the area of general welfare assistance in this past fiscal year, we have experienced a very significant increase in the number of individuals in receipt of the benefits.

The overall rate of increase last year, in terms of the number of cases -- this is not the dollar figure but the number of cases -- is about 11.6 per cent. That may well be attributable to a number of factors, but we think the most significant one has been the continuing relatively high rate of unemployment.

The probability that there are more people now and during the course of the past year whose entitlement to benefits under the unemployment insurance scheme at the federal level expired and who therefore resorted to general welfare assistance for their maintenance for a short period of time.

I would point out, just so no false impressions are created, that even though there has been that significant increase -- and I think a significant amount of it is attributable to the termination of unemployment insurance benefits -- our average length of stay is still relatively low. In fact it fluctuates depending upon the time of year because of availability of employment in the winter as opposed to the summer and so on. It still would be in the range of four to six weeks and perhaps a little higher at times during the winter. These persons are not long-term recipients, generally speaking, of general welfare assistance, that is the employable individuals.

The member asked how far we were out in terms of projections. The 1978-79 estimate for general welfare assistance was $166 million and the current requirement is $177, $178,000. Does that answer each of his questions?

Mr. McClellan: I’m interested in the number of cases and then the breakdown of beneficiaries. I don’t want to belabour the point. If it’s difficult for the officials to pull it together on the spot, maybe the minister could submit it to me at a more convenient time. I don’t want to waste the time of the House with a statistical overview, but I’d be grateful to receive that material.

Anxious as I am to participate in this estimate, I was in midflight during the estimates of the Workmen’s Compensation Board downstairs and I’m kind of anxious to get back to them; I would make a couple of observations, however.

We will pay the price of this government’s failure to undertake any serious measures on job creation for the last two years; we will pay that price in increased welfare costs, as we are already seeing in the supplementary estimates.

We will pay the price of the federal government’s vicious folly in cutting back on unemployment insurance benefits, as though cutting back on unemployment insurance is somehow going to get rid of unemployment. It simply will transfer the burden of unemployment costs on to the province and then down on to the municipalities and on to the property tax. I think probably the minister shares my view to some extent with respect to the seeming obsession of the Liberal government in Ottawa to mutilate and destroy the unemployment insurance program at a time of astronomical unemployment.

Again, that will show up. It hasn’t shown up yet, I suspect, as fully as it will over the next fiscal year when the full impact of the recent changes to the act begin to take place and people are cut off unemployment insurance and put on to the municipal welfare rolls.

The solution to each dilemma lies in the serious commitment on the part of government at both levels, though for now I direct my attention to the provincial government, to a serious program of job creation. We’ve gone through a winter with the worst unemployment, at least since the Diefenbaker years if not since the depression, with a complete absence of any serious winter works program that could have put people back to work. Yet we are prepared to spend scores of millions of dollars on general welfare assistance at a time of enormously high unemployment. That doesn’t make any sense.

[9:00]

I don’t know whether the government intends to go through this exercise year after year. In times of high unemployment, it seems to me that it is the height of folly. The government has moved, at least in the throne speech announcement, to speak to the need for work incentive programs. We are anxious to hear the details of work incentive programs. The minister knows we have been arguing for the past three years for a serious commitment on the part of the government --

Mr. J. Reed: Ask Gordon Walker.

Mr. McClellan: -- to job creation and job placement and job training for social assistance recipients in this province. Let me say in passing, since the Minister of Correctional Services is in his chair, that we are not interested in work-fare. Thank you very much, we are not interested in slave labour.

Hon. Mr. Walker: You are not interested in work at all.

Mr. McClellan: We are not interested in your bully-boy approach to the problem. We are interested in changes to the legislation that will make it possible for social assistance recipients on family benefits to go back to work and to keep a generous portion of any earnings that they make. We are anxious for the legislation to be amended so that the current artificial restrictions on the number of hours that, for example, a single parent mother is entitled to work be removed altogether.

We are anxious that the earnings exemption of $100 a month be raised. We are anxious that the earnings exemptions for children under the Family Benefits Act for single-parent mothers be raised, and I suggest at least as a minimum, to $50 per child per month. We are anxious that the tax-back rate, the 75 per cent tax-back rate on single-parent mothers on family benefits allowance who are working part-time be revised drastically.

I am not able to produce the figure because I don’t have the staff resources to be able to calculate the combination of tax-back rate and breakeven point that would be desirable. That is a job that requires technical people in the ministry.

Mr. Chairman: Order, order. I think the honourable member is straying somewhat and I wish he would return to the expenditures of the money under those supplementary estimates.

Mr. McClellan: I am pleased to see that you are paying attention, Mr. Chairman.

Mr. J. Reed: It is very hard, you know.

Mr. McClellan: I have made the point. Those are the kinds of things that need to be done if we are to provide employment opportunities for social assistance recipients that will permit them to return to work, either full time or part time, to raise their incomes to a level of adequacy through earnings which they are permitted to keep, rather than the present practice, frankly, of robbing social assistance recipients of their earnings, because that’s what the legislation does now --

Mr. Warner: No wonder you are embarrassed.

Mr. McClellan: -- and that the breakeven point and the tax-back rate be set at a point so that a person is able to work and still receive benefits to a level of real generosity, and by that I mean a level approaching $10,000-$12,000 a year.

In the meantime, we have supplementary estimates, Mr. Chairman, and you will be asking yourself what relevance does this have to the supplementary estimates. We have dollar amounts in the amount of $7.2 million which represent, I suppose, the tag end of the latest six per cent rate increase. What marvellous generosity this government displays, a six per cent increase in a year when the consumer price index rose 12.1 per cent.

Mr. Kerrio: Give them 20 per cent.

Mr. McClellan: Social assistance recipients in this province are living in poverty.

Mr. Warner: The minister knows that.

Mr. McClellan: I don’t have to repeat chapter and verse. We make the point every estimate; and every year the minister shrugs and smiles and confesses his charming, sincere concern, and does nothing. He does nothing to give real purchasing power to social assistance recipients who have no other source of income but this ministry. They can’t eat concern.

There is no way that your rent allowances cover rents; there is no way that your food allowances cover food; there is no way that anybody can live up to any adequate or decent standard on the kinds of rates provided under the Family Benefits Act or under the General Welfare Assistance Act.

We will pursue this again in the estimates when we get there in a couple of weeks. I say in passing again tonight that you are cheap with respect to the amount of money you are prepared to allocate. You are causing real hardship. You are causing real hardship to families in this province. Because, Mr. Chairman, you know as well as I do that it is not possible to stretch the family benefits dollar in today’s rental market. It is not possible to purchase adequate, nutritious meals for families on the miserly pittance provided under the Family Benefits Act. That is not an exaggeration; the rates are too low.

I hope that we will hear in the budget, as well as more work incentive measures, a measure of social justice with respect to the rates. I hope that there will be --

Mr. Chairman: Order. We are not on the budget debate.

Mr. Warner: Seven million dollars!

Mr. McClellan: We are on the estimates debate with respect to the rate increase. We are on an estimates debate with respect to the last increase of income maintenance.

Mr. Breithaupt: Fourteen million dollars.

Mr. Chairman: The income maintenance.

Mr. McClellan: I will be concluding shortly.

Mr. Breithaupt: Good.

Mr. Kerrio: Thank heaven for small mercies.

Hon. Mr. Norton: Well at least you haven’t called for my resignation tonight yet.

Mr. Warner: The evening isn’t over.

Mr. Wildman: We might get Walker.

Mr. McClellan: I would invite the minister to respond now as to whether or not he intends to raise the family benefits rates; even to restore lost purchasing power since the previous rate increase let alone to bring them up to any adequate or decent standard of living.

Mr. Warner: It gets worse every year; it gets worse instead of better.

Hon. Mr. Norton: Mr. Chairman, I can assure the honourable member opposite that I will not be recommending any rate increase out of the estimates that are before the committee at this point in time.

Mr. Warner: Of course not.

Hon. Mr. Norton: These are moneys that have already been expended in the past fiscal year and his question relates more clearly to estimates for the next fiscal year.

Mr. McClellan: Don’t be so slavish to the agenda.

Hon. Mr. Norton: I don’t know whether he wants me to continue to respond to the other matters he raised, or whether it was just that one specific response he was eliciting at this point. I would point out, just as a matter of interest --

Mr. McClellan: Make sure he doesn’t stray out of order, though.

Mr. Warner: You never disappoint us.

Hon. Mr. Norton: -- and this is not to try and suggest that the persons who are in receipt of assistance in this province, under either of the programs in force, are in any way living in the lap of luxury.

Mr. Wildman: Oh we wouldn’t believe that, either.

Hon. Mr. Norton: I would point out to you, though --

Mr. Warner: It’s called poverty.

Hon. Mr. Norton: -- that concepts of poverty are really relative in a very real sense --

Mr. Warner: Three hundred and fifty thousand in Toronto.

Hon. Mr. Norton: -- and I would suggest to you, in spite of the fact that I acknowledge there are persons living with considerable difficulty on their limited incomes --

Mr. Warner: In poverty; in poverty.

Hon. Mr. Norton: -- they in fact, in real and relative terms for example, are doing better than persons who are gainfully employed in some of the medium-income groups in other jurisdictions.

Mr. Warner: In poverty; in poverty.

Mr. Wildman: Are you comparing them to southeast Asia?

Hon. Mr. Norton: I would also point out to you that when one considers the increase that was awarded in January, although this other item is not part of our estimates, if one takes into consideration the tax credit change which the federal government made with respect to family allowance, which actually follows a pattern we had been recommending to them for some time in terms of tax credits as opposed to some of the other approaches that have been traditionally used, a family with two children in receipt of provincial benefits will have approximately a 13 per cent increase in their benefits --

Mr. McClellan: What period of time?

Hon. Mr. Norton: In this year.

Mr. Warner: Over what?

Hon. Mr. Norton: Over the level of benefits they received last year.

Mr. Warner: Doubling zero.

Hon. Mr. Norton: One has to look at the total income. I am obviously not suggesting this government is in any way trying to take credit for the tax credits, but it is also part of the income of those persons we seek to assist.

On the matter of work incentives I am very pleased the honourable member has, consistently, verbally been as supportive as he has of my efforts to get the support of other provincial governments --

Mr. McClellan: I see you weren’t supporting my efforts.

Hon. Mr. Norton: -- and also the federal government to seek the kind of flexibility that in my opinion is necessary under the Canada Assistance Plan so that we can introduce some truly realistic incentives for the persons who are on benefits to assist them to make that transition which too often is very risky and chancy if they have a young family for whom they have responsibility. I was hopeful I would have the response.

As I have told the honourable member before, I had discussions with the federal minister at the federal-provincial conference in the fall following an interprovincial ministers’ conference where the other provinces endorsed our proposals. At the senior staff level, discussions have been taking place since January and I understand we are making significant progress. I had recently, at the senior staff level, requested that we receive a response early in April. With current developments at the federal level I am not sure I will get a response until after May 22. Perhaps good fortune will be on the side of the people of Ontario and this country and we will get a more responsive government following May 22. I am not suggesting --

Mr. Wildman: Cheering for Broadbent, are you?

Mr. Warner: Thank you very much. We appreciate it.

Hon. Mr. Norton: I won’t name names, of course, but I could suggest one person I wouldn’t mind seeing as --

Mr. Warner: Nobody knows who his last name is.

Mr. Breithaupt: George Hees.

Mr. Warner: Joe Who.

Hon. Mr. Norton: -- the Minister of National Health and Welfare.

Coming back to the question of work incentives, just to wind up, I think that is an area in which we will make studies, given the opportunities. It is very difficult for us to go it alone without co-operation from the federal government.

Mr. McClellan: Quebec appears to be going it alone. I haven’t seen all the details in the Quebec scheme but they seem to be willing to go it alone.

Hon. Mr. Norton: As I understand the scheme, and I am waiting for a complete analysis of it, that is an income supplement program more than a work incentive program. They are not totally unrelated, but that does not necessarily agree with what we are talking about in terms of the work incentive program.

Mr. Warner: Bring the studs, in.

Hon. Mr. Norton: You did ask, and I can give you very briefly, a breakdown of the recipients and the difference between forecast and actual numbers of recipients. It is still the current fiscal year, isn’t it?

We anticipated among the employables on general welfare assistance at 26,792. In fact the forecast average -- we don’t yet have the figures for February and March -- but it appears the actual figure will be 29,813. Among those who are unemployable the projection was 65,827, and it would appear that the actual number of cases will be about 69,267 in total. For the unemployables, the figures are 39,035 projected and 39,454 actuals. The previous figures of 65,827 and 69,267 were the totals for both.

[9:15]

Mr. J. Reed: I find it a little awkward tonight talking about supplementaries. I know I would be out of order talking about supplementaries in general; so I won’t. I will not mention the other $82 million of the total supplementaries of $96,165,000, because I suppose that would be out of order; so I will have to confine my remarks to the ministry at hand.

This supplementary is an admission by government of miscalculation.

Hon. F. S. Miller: Oh no; we kept to our total spending.

Mr. J. Reed: Oh, it is not an admission of miscalculation?

Hon. F. S. Miller: We didn’t change the totals.

Mr. J. Reed: This is something that the government planned at the beginning so it could keep it back to convince us that the budget really showed restraint and then bring on the supplementaries a little later to the tune of $96,165,000; is that it?

Hon. F. S. Miller: The total doesn’t change. It is totally opposite to savings.

Mr. J. Reed: You know, you fellows have been miscalculating this way ever since I’ve been here.

Mr. Kerrio: And 30 years before that.

Mr. J. Reed: I’ll just go back to the beginning of this decade. It seems that every time we have a budget, we are bombarded at the last moment with a supplementary -- in this case -- a supplementary for the Ministry of Community and Social Services to the tune of about $14 million. I hope that’s in order, Mr. Chairman.

Mr. Chairman: We are not talking about the last decade. We are talking about right now.

Mr. J. Reed: I don’t deny for one minute the fact that we do need the money. As my colleague from Sarnia pointed out, there is no way we can deny the approval of that request for the $14 million. But I deplore the fact that we are having to approve it at the end of the fiscal year, at a time when the money has been spent, when the train is pulling out of the station, and there is no way we can really change this. So let’s call it what it is: a gross miscalculation.

I would ask the minister -- because I can’t ask all the ministers; that would be out of order -- how much is he going to miscalculate or change for next year’s budget? What is he going to bring in for next year’s budget to convince us that it is a budget of restraint, to convince us that he is doing the best job for the taxpayers in Ontario, and then turn around in the early spring of 1980 and say, “Oops, we need another $14 million or $15 million”? Or maybe it will be an escalated $14 million; maybe it will be $20 million the next time. I do deplore that, Mr. Chairman.

Hon. Mr. Norton: Mr. Chairman, I have often admired the honourable member opposite as he slid about on his most recent popular television commercial. I also admire the way he attempts to slide a few things into this discussion tonight which perhaps don’t properly belong here. I won’t respond; I’m sure he has already heard the Treasurer indicate that, in spite of the fact that these are supplementary estimates, they are within the total projected year’s spending.

I would also ask him, rhetorically, what he would consider a reasonable percentage error might be, especially when you are dealing in an area of human services? I know the member for Bellwoods (Mr. McClellan), who has now disappeared, has frequently criticized us in some areas for some slight underspending in terms of our projections. The member opposite has expressed concern about some overspending. I point out there was no error in terms of projection with respect to the six per cent increase. That was not a question of error, that was something that was introduced part way through the year and accounts for almost half of the $14.6 million. Even if you include that, if you take the whole of the $14.6 million as a percentage error in our budget, it is approximately one per cent.

I really don’t think you can seriously suggest that in the development of very complicated projections in an area of human services, where we don’t know accurately, certainly, how many people are going to face greater hardship because of unemployment 12 months hence, there was an error.

Mr. Wildman: Neither does the Treasurer.

Hon. Mr. Norton: Our analysts, some of whom are here before me tonight, are extremely competent people, as is evidenced by the fact that they can estimate and project that closely.

Mr. Kerrio: Sure you didn’t borrow it from Hydro?

Hon. Mr. Norton: In fact, if you removed the six per cent increase as part of the $14.6 million figure, we are within about one half of one per cent on a budget of almost $1.3 billion. That I think, is very careful, accurate, competent planning on our part.

Mr. B. Newman: Very poor.

Hon. Mr. Norton: Very poor? Oh come on, Bernie. I ask you to show me anybody in the private sector anywhere, or any other area of government, where they do such a fine job of planning as we do in my ministry.

Mr. J. Reed: I would just like to ask the minister two questions. First of all, does he think we should, from now on include a factor within every ministry estimate as to some projected percentage of overrun every year? Do you think that would be a suitable thing? The next thing I would ask him is why are supplementaries consistent virtually every year? Why are we locked into this? Perhaps I am a little out of order in singling out the Ministry of Community and Social Services on this, but I find at the end of every year after the money is spent, we are faced with this kind of necessity to approve money which is simply added to the provincial deficit.

Hon. Mr. Norton: Mr. Chairman, I suggest to you that in many instances there probably is some leeway that is worked into the calculations, but regardless of how you approach it you certainly cannot possibly be accurate on all of the possible variables.

Let me give you an example of one thing which occurred in this past year. I cannot speak for other ministers and I am sure the Treasurer can give you more accurate figures on this than I --

Mr. Wildman: I doubt it.

Hon. Mr. Norton: -- but it had a massive impact upon us in the province of Ontario that was entirely unexpected and beyond our control. It started last summer following our Prime Minister’s conversion on the road to Bonn; or on the road home from Bonn, wherever his conversion took place.

Mr. J. Reed: Whenever you get in trouble you blame it on the feds.

Hon. Mr. Norton: No, no; just let me give you an example of how complex the planning we engage in is. Among other things, a $55 million block fund transfer, increased funding which we were planning for this year, suddenly disappeared. It was a unilateral decision. In addition to that, there were significant changes introduced in the unemployment insurance system, which has an impact directly upon the programs of my ministry.

In addition to that, there were a whole host of other things which I toss out as a figure, and the Treasurer may or may not wish to confirm this, but in total, by the time these changes at the federal level are fully matured it’s going to cost in this province somewhere between $400 million and $500 million. We cannot take the blame for those kinds of things. I’m sure the changes in unemployment insurance benefits alone have accounted for a significant part of this. It may yet be too early to say. We don’t know for sure, it’s hard to know yet exactly what the impact of them has been. Undoubtedly, they will have an impact upon us, probably about as much as half of this difference.

Mr. Wildman: I have a short question. Can the minister explain if this increase is mostly caused by increase in caseloads, or by the problems he mentioned with the federal government or through miscalculation? I think he’s going to say it’s not miscalculation. If it isn’t one of those first two, is it the increase that he finally gave last summer? If he can answer that, then I would like to ask him a further question.

Hon. Mr. Norton: As I’ve already indicated, we would attribute about half of it, $7.2 million, to the rate increase. It’s very difficult to break down all the other factors in terms of dollar figures but I would point out that it’s not all in those programs alone.

For example, the drug program accounts for $1.6 million of it, and we can pretty clearly attribute that to factors such as inflation. In addition to that, additional drugs have been added to the list over the course of that period of time, which have had some effect upon it. There is an increased rate of usage; for whatever reason we can’t be certain, but probably because more people are aware of the availability of the medication or more doctors are using prescribed medications for their patients. All those factors have contributed to a $1.6 million increase.

Mr. Wildman: If that’s correct, is the minister aware, in considering his rate increase and the total income allowances for people on assistance, whether it be family benefits or whatever, that in northern Ontario today the fuel allowances are completely inadequate and that his rate increase in their incomes doesn’t deal at all with these increases in inflation and so on?

I don’t care if this is in order or not, Mr. Chairman. I just want to make the point that in northern Ontario people are really in trouble in terms of their fuel allowance.

Mr. Chairman: That is not quite the point.

Hon. Mr. Norton: It’s unfortunate the honourable member chose that example. I believe he is aware of the fact that we will pay the actual costs of fuel under our program. In fact, the figures he cites are the minimum. Within the past two years, we have introduced a more flexible billing system, a system which will allow the people to submit theft bills almost on a monthly basis so that they can receive the additional fuel allowance. There is no reason, under those circumstances, why persons ought not to be receiving full reimbursement for their increased fuel costs.

Mr. Sweeney: I have two questions for the minister. First of all, the minister referred earlier to the $11 million on municipal allowances and benefits. He also referred to his work incentive programs. I’ve brought this to his attention before and he keeps telling me it can’t happen, but it happened in the city of Kitchener last week where a woman who was working and who couldn’t get municipal assistance for day care had to quit her job and go on welfare. That’s the kind of thing that builds up this $11 million.

On the second question, recently the city of Kitchener and the region of Waterloo, meeting with the social services department and also with the children’s aid society have had serious conflicts and serious confrontations as to how much money they were going to approve. In both cases the social services administrator, particularly, indicated clearly that before the year was over he was going to need much more money than the municipality was going to approve. They just went through this charade year after year after year.

[9:30]

What kind of communication is there between your ministry and the local municipalities for dealing with this kind of situation where you both know that by the end of the year you’re likely to have more cases and more need? Yet we have this tremendous public outcry, and it looks as if the social services department, the children’s aid department, is asking for outrageous increases when year after year, just as you have indicated yourself, you’ve got to come back and say, “The need has gone up and we need more money.” Isn’t there some communication mechanism that we can get between you people and the municipalities and the public in those municipalities to prevent this kind of public confusion?

Mr. Wildman: That is the job for that member.

Hon. Mr. Norton: First of all, on the first point you’ve made relating to an individual who did not qualify for assistance with day care, I believe you said, or was unable to get it, it’s difficult to respond to that without knowing something more about the specifics of the case.

Mr. Conway: It is happening.

Hon. Mr. Norton: You say it’s happening, but all I’m saying is let’s be more specific. There may be some reason for it. If you wish to give me the particulars of the case I’ll certainly check into it and see what I can find out about it. But to answer it in the abstract is very difficult because I don’t know why the persons might have been found not to be eligible if they were employed -- a single mother I presume is what you’re suggesting. I would have thought they would have had a high priority for a space for their child in the day-care program. Perhaps there were other factors of which I can’t be aware at this point. I don’t know, but I would be quite happy to check into it for you.

As far as the children’s aid society and the local -- I wasn’t sure whether you were referring to children’s aid society budgets or the local social services budget of the municipality or both.

Mr. Sweeney: Social services, but children’s aid faces the same problem.

Hon. Mr. Norton: Sure, certainly. All right. There are certain things that are almost impossible to project accurately. The children’s aid societies know when we approve their budgets it does not take into consideration the full possible, or even maybe expected, caseload during the course of that year. Rather than saying to them, “You have this amount of money and that’s it, regardless of whether the number of children in care goes up or goes down or whatever,” we approve the level of estimates in their budget at the beginning of the year based upon the previous year’s experience. Then whatever increase in caseload they do experience during the ensuing fiscal year we cover at the end of that fiscal year by way of supplementaries. I don’t know of any easier way to do it.

Some of them will say, “Why don’t you give us the money at the beginning of the year?” But we don’t know what their caseload increase is going to be 12 months in advance; nor do they, and it’s almost impossible. You don’t have a regular curve that you can project upon. In fact there has been in the past few years an occasional decline. So it’s not as accurately predictable as one might wish. We’re dealing in human services. We’re not dealing in building bridges or something like that.

The same thing applies to the experience of the municipal welfare budget. Again, it’s almost impossible to know. They have the same difficulties in terms of projecting figures and caseloads as we would, but we agree and they know we will meet the cost of any increased caseload. It’s not as if we’re leaving them high and dry, without support, with that responsibility. It’s just that there is no way at the end of one year to be able to project what the economic conditions are likely to be 12 months later -- what the increase might be in the caseload.

I really think that is a reasonable way to approach it -- to say to the children’s aid societies, “We will meet those costs when we know what they are, but we don’t know what they’re going to be yet.” Basically, we say the same thing to the municipalities with respect to their general welfare assistance budget.

Mr. Sweeney: Mr. Chairman, I’m accepting the premise that both of these agencies cannot necessarily predict accurately. My concern is this. Since you have to do this sort of thing provincially each year, and since it seems that almost on an annual basis the municipal or regional social services department and children’s aid society have the same problem, isn’t there some way your ministry can communicate with the local regional government or the local municipal government and, through them, to the public -- that is, explain that these things are almost inevitable? Can you not somehow avoid these annual confrontations and conflicts which end up with the local news media, the local public, the local municipal council and the local regional council calling these two agencies every name under the sun, and saying they’re coming in with unrealistic budgets? Isn’t there some way we can avoid that? We’re creating a public climate.

Hon. Mr. Norton: I don’t know whether the honourable member opposite is suggesting we should somehow try to eliminate the equivalent, at the municipal level, of the estimates debate when increased expenditures are being considered. I certainly would not suggest we do that at the provincial level. I don’t think it’s desirable at the local level. I don’t think you can reasonably suggest that, after all these years, municipalities and children’s aid societies don’t know this is necessary. Surely they have some responsibility to communicate with their electorates, as we do with the people of this province.

To suggest there should not be some discussion, sometimes very controversial, about the expenditures of even the children’s aid societies, and particularly those of the municipal governments -- discussion that takes place at the times when they recognize increased expenditures -- surely that is healthy in a democratic society. Surely it is just as healthy as it is for me to be accountable to you in this forum and in this type of discussion about my ministry’s increased expenditures.

Mr. B. Newman: Mr. Chairman, I didn’t expect to get into the discussion. But I wanted to ask the minister whether or not this type of problem is prevalent in his ministry. This was brought to my attention concerning senior citizens and their old age pension and other supplementary cheques. They receive them a little too late, in some instances, to take advantage of discounts on utilities. Is this a problem with the Ministry of Community and Social Services?

Hon. Mr. Norton: I’m not aware that we have received particular complaints. I know that as a member representing a constituency I have received complaints, but again they are usually related to Gains cheques or old age security cheques. I’m not aware of any serious problems with regard to paying municipal utility rates relating to the timing of our cheques.

Occasionally there are complaints around Christmas but that doesn’t relate to utility cheques; it relates to the availability of funds for the Christmas season.

I might just point out that I think the provincial Gains cheques go out in the middle of the month. That shouldn’t be a problem. I should think they would have them well in advance of the end of the month. The old age security cheque goes out about the 25th of the month. But I would point out that we do not send out the old age Gains cheques; that is done through the Ministry of Revenue.

Mr. B. Newman: I was just wondering whether you had a problem similar to the problem of these senior citizens with their old age pension cheques and Gains cheques?

Hon. Mr. Norton: Not that I’m aware of. There may be some individual cases.

Vote 2802 agreed to.

SUPPLEMENTARY ESTIMATES, MINISTRY OF TREASURY AND ECONOMICS

Mr. Deputy Chairman: The next items are those of the Treasurer. Do you need the table and the supporting staff, Mr. Treasurer?

Hon. F. S. Miller: I probably need all the support I can get.

Mr. Deputy Chairman: That was a foolish question I asked. The items are found on page four.

On vote 1103A, economic policy program; item 1, economic policy:

Hon. F. S. Miller: I will give a brief statement on this. The supplementary estimates I have before the committee today relate to a portion of Ontario’s share of the grant to the Ford Motor Company for the construction of the engine plant in Windsor.

It is estimated Ontario’s share of the grant to Ford in the fiscal year 1978-79, just ending, will equal $5.3 million. Of this amount, $700,000 has been constrained from within my own ministry. The total spending by Ford on the engine plant for the period ending March 31, 1979, is expected to equal $12.7 million. The federal government will pay $7.4 million of this amount.

For the assistance of the honourable members I would like to review briefly the background of the decision to make the grant to the Ford Motor Company of Canada. In early 1978 the Ford Motor Company announced its intention to build a $533 million engine plant in North America. A number of preferred site locations were mentioned but it was quickly established that the company would either build a new facility in Windsor or expand an existing facility in Lima, Ohio.

Mr. Grande: You were taken in by that.

Mr. Warner: They held you up for ransom. Corporate blackmail.

Hon. F. S. Miller: Ohio was willing to offer assistance to Ford.

Mr. Warner: It’s corporate blackmail.

Hon. F. S. Miller: If getting 7,000 jobs required blackmail, I will be blackmailed.

Mr. Warner: You know it is corporate blackmail.

Hon. F. S. Miller: I am not calling it anything at all.

Mr. Warner: No, just give them the money and let them run.

Hon. F. S. Miller: Ohio was willing to offer assistance to Ford if Lima was chosen as the site for the new engine plant.

Mr. Warner: Nothing in return.

Hon. F. S. Miller: May I read, Mr. Chairman? In order for Ontario to receive this investment, some sort of assistance for Ford would be required. Ford indicated the cost disadvantage of locating a new facility in Canada totalled $67 million US. As a result of discussions among the Ford Motor Company, the federal government and Ontario, Ford decided to locate its new engine plant in Ontario. It was agreed a grant of $68 million would be made to Ford. The Ontario government would be responsible for $28 million of this amount.

Mr. Warner: A mere pittance.

Mr. Grande: You wanted to give them $30 million, didn’t you?

Hon. F. S. Miller: This agreement was confirmed by an exchange of correspondence between the Premier of Ontario (Mr. Davis) and the president of the Ford Motor Company of Canada in August of last year.

I would like to review for members the nature of the investment which Ford has undertaken and to review conditions prevailing in the auto industry within Ontario and particularly in the area of Windsor. This major investment by Ford is both timely and a much needed investment for the Windsor area. The engine plant is a parts facility having economic characteristics that are highly favourable to the industrial development of Canada. The jobs this investment will produce are relatively high-skilled, providing higher income and a more stable job base. Moreover, the investment will make a positive contribution towards closing Canada’s trade gap in auto parts with the United States. This deficit in 1978 was $3 billion.

Mr. Cooke: You don’t even have the skilled workers. You are blind.

Hon. F. S. Miller: That is everybody’s fault, just remember that.

Reflecting the problems of the auto industry, the economic climate in Windsor was poor. Unemployment was close to 10 per cent.

Mr. Cooke: Twelve.

Hon. F. S. Miller: That is close to 10 per cent, well above the provincial average.

Mr. Warner: Yes, that is close, Frank.

Hon. F. S. Miller: There were prospects of a number of further layoffs in the auto industry. Bendix employment was down 150. Gulf and Western Bumper had long-term layoffs of 160. Ford had announced temporary layoffs of 1,500.

Mr. Cooke: And they have more.

Hon. F. S. Miller: Chrysler was moving one of its production facilities to Michigan. The depressed status of the Windsor economy made it important that every effort be made to get the Ford engine plant.

Investment by Ford will have significant impact. The new plant will represent a net direct addition to total employment in the area of 2,600 jobs. In addition, because the plant is a parts facility, it will require a substantial input from directly related feeder industries. The impact on this group could equal the 2,600 employment gain from the plant itself.

The Ministry of Industry and Tourism has estimated the additional economic activity generated from these workers and the income they bring into the area could raise the overall employment impact to between 7,500 and 8,000 workers.

[9:45]

Mr. Warner: Nothing in return. No equity.

Hon. F. S. Miller: Moreover, the new tax revenue that the Ford plant and its workers would generate for both Ontario and Canada could cover the public funding of the new plant in as little as 13 months.

Mr. Chairman, as a result of the Ford decision --

Mr. Warner: You wanted to give away money.

Hon. F. S. Miller: -- the situation in Windsor is now much improved and investors are reacting to the renewed interest in this area.

Mr. Cooke: Unemployment is still 10 per cent.

Hon. F. S. Miller: The Monarch company, for example, has announced a $65 million vegetable oil refinery for the area. Encast Incorporated of Switzerland is locating a $9 million casting plant in Windsor. United Co-op is spending $21 million on a new deep water terminal on the Detroit River and, as a direct spinoff from the engine plant, Ford has announced a $52 million new aluminum casting plant to be located next to the engine-plant site.

This grant provides real and direct benefits for the economy and for the people of Ontario.

Mr. Warner: Ford is laughing all the way to the bank. You guys were conned.

Mr. Kerrio: Mr. Chairman, I would like to comment on this particular supplementary estimate as it relates to my concern in the business world. I’m afraid this is a dangerous road that we’re beginning to tread. I am somewhat disappointed that some of this same type of assistance isn’t going to be made available to some of the smaller industries that, in fact, provide more of the job opportunities throughout Canada and Ontario than any other facet of government or industry.

Mr. Warner: It has to be an American corporate.

Mr. Kerrio: My background is free enterprise, truly free enterprise in the sense we don’t get this kind of money available to us, we don’t have the advantages of the multinationals in the arranging of prices. We don’t have many of the advantages and I wonder if the government is going to make the same kind of commitment that we’re making to these large corporations, to the very backbone of small business throughout the province. I hope that might be done. But if it is done, Mr. Chairman, I suggest to you it should be done in the proper way of investing money which is on an equity basis. Those corporations, if they were truly the --

Mr. Samis: That’s not the right thing, Vince.

Mr. Kerrio: -- free enterpriser that needs help, would be most willing and prepared to buy back the equity the taxpayers of this province put up --

Mr. Samis: Do you support Petrocan, Vince?

Mr. Kerrio: -- to finance the kind of program we’re talking about here.

Mr. Wildman: You’d better rethink your position.

Mr. Samis: Are you a Petrocan man, Vince?

Mr. Kerrio: I don’t know why those people over there are interjecting; I don’t know what they know about business or free enterprise or working.

Mr. Warner: More than you do.

Mr. Samis: We pay taxes.

Mr. Kerrio: You people are takers, you have never given anything to this society --

Mr. Warner: A lot more than you do. You couldn’t run a peanut stand.

Mr. Kerrio: -- except a bunch of interjections on a subject you know nothing about.

Mr. Cooke: What did your leader say last July?

Mr. Kerrio: In any event, Mr. Chairman, we have very valid reasons for putting money into areas that will create jobs for the people of Ontario, but I submit to you that I’d like to see it done on an equity basis -- and I don’t mean stock purchase either. I mean an equity basis where a company, big or small, cannot take too much profit before the equity is repaid to the taxpayers of Ontario. I think that’s a valid way to put up money in a very helpful manner.

Mr. Warner: We appreciate your support.

Mr. Kerrio: The other thing I have to mention, and I suppose the federal government could be criticized for this too --

Mr. Wildman: Really?

Mr. Kerrio: -- is the fact that if we are somewhat comparable to the United States on about a 10 per cent basis in the use of automobiles and all the related trades, I think we’re entitled to the manufacturing as it relates to the market in Canada. I can’t believe that we should be entitled to a great deal more or a great deal less. If the government of Canada and the government of Ontario took the kind of stand they should take, I can’t believe that Ford Motor Company and General Motors, which incidentally is making one of the best profit ratios of any of its plants in the world, and every other corporation with good management and good regulations wouldn’t be building plants without this money.

Mr. Samis: Good free enterprise.

Mr. Kerrio: I would suggest, in winding up my remarks, that certainly I concur with what the government is doing in making moneys available to those people who need the money and in such a way that they are allowed to buy back the equity that the government would have in the corporation, and also with the stipulation they would not be able to take any kind of profits out until the money is repaid.

Mr. di Santo: The position of the NDP caucus on the grants to Ford has been made known since last year --

Mr. Kerrio: Nationalize them. You’ve only got one way to go.

Mr. di Santo: -- contrary to the position of the Liberal Party which has been fluctuating. I can understand the torture of the free enterpriser who all at once --

Mr. Kerrio: Certainly you don’t. You have never been there, so how could you understand it?

Mr. di Santo: -- finds himself in a position to give $6 million to $8 million to one of the largest multinational corporations even though he preaches small business every day. I understand that as well as I understand the position of the Treasurer who said that this grant was unorthodox.

Mr. Warner: He just gives the money away.

Mr. di Santo: I think he tried to reconcile his position with the position of the previous Treasurer who was opposed, and who in his speeches made it quite clear he was opposed to this kind of grant.

At this point, for the record I would like to correct the statement of the Treasurer which is inaccurate historically because it is true that Ford in its presentation said that initially it needed $75 million and subsequently that it needed $68 million. It isn’t even true and the Treasurer knows it. He can check with his tax and fiscal policy branch that the comparison made by Ford was between an entirely new greenfield plant to be built in Ontario and an addition to the plant existing in Lima, Ohio. Therefore the cost differential was distorted in favour of Ford.

Apart from that, according to TEIGA calculations, the Ontario tax comparison is in our favour. But if our sales tax is higher, it certainly could not be as much as $14 million higher than Ford mentioned in its presentation. The reason given by the Treasurer for the grant to Ford was that the government was motivated by the fact that unemployment was high in Windsor and that it would create 2,600 jobs. I don’t think it’s possible for the minister to rationalize that the new investments he mentioned in his statement, except for the aluminum plant and Ford, are a direct result of that grant because it just doesn’t follow.

To give to Ford $20 million from Ontario is not only unorthodox but it’s a wrong way of choosing priorities because we know that the problem of jobs in the manufacturing industry will not be solved by buying job by job. We know that even if we are creating 2,600 jobs in Windsor, in January 1979 we had an $89.3 million deficit in the auto pact and if each job in Windsor costs $190,000, in January we lost only 470 jobs as a result of the deficit in the auto pact.

This means in effect that the problem is much more complex and goes to the very concept of the auto pact, the way it is operated and the way it has been administered by both the federal and the provincial government. A very high responsibility falls on this government because we know 90 per cent of the automobile industry is in Ontario and we have more than 105,000 workers employed in it in this province.

We know that since 1971 we have had constantly a very huge deficit in the auto trade in general, but especially in parts and accessories. As the Treasurer mentioned, in 1978 we had $3 billion deficit which, at the cost of $190,000 per job, means a net loss of 15,600 jobs in the parts manufacturing sector for Ontario.

Mr. Grande: That is how you create jobs.

Mr. di Santo: How much does the government intend to spend in order to create 15,600 jobs? Where is the government going to beg jobs -- from General Motors for another plant somewhere else in Ontario, from Chrysler and from American Motors?

I think, Mr. Chairman, that this government doesn’t understand, even though they pretend to be free enterprisers, what a modern enterprise is. Above all, since 1975, they didn’t understand, despite our suggestions and the suggestions of the auto workers -- and there was a very long correspondence from the treasurer of the United Auto Workers on the dangers he saw inside the auto pact and how staggering the trade deficit was becoming for Canada.

I would also like to make a final point because we want to come to the supplementary estimates for Health. Despite the optimism of this government, we know that the auto pact will work against the best interests of Canada. There won’t be a balance in the trade between Canada and the United States, because the four big companies are practically dictating to Canada the policy that they want, especially in the parts sector which is crucial to the manufacturing sector of Canada.

Not only that, but there is another aspect that is really frightening. That is that despite what the Minister of Industry and Tourism (Mr. Grossman) has been saying recently -- as recently as March 15, 1979 -- last year in Canada, we had in a vital sector, research and development, spent only $8 million. According to the calculations of the Science Council of Canada, $230 million went to the United States from Canada. For this reason we think that to give one grant to a company doesn’t solve the problem of our economy.

We also know from a study made in Canada by Data Resources of Canada that the calculation of the deficit is in the range of $10 billion in 10 years. That’s without calculating the $60 billion in investments that the four major automobile companies have decided on in the next years, in order to change their cars to models that consume less oil.

Last spring, the former Treasurer, Darcy McKeough, published a paper which called for a fair share of the North American market for Canada. I don’t think one of the ways he lists to achieve that goal is legitimate. Because, if we are one-tenth of the North American market we should retain one-tenth of the $60 billion investment if the auto pact is to work in the best interests of Canada and the United States. I don’t think we solve that problem, which is a very crucial problem -- the problem of the major investment which will revolutionize the automobile industry in the next few years. We think that creating 2,000 jobs is good electorally, it is good demagoguery, but it doesn’t solve the economic problems of this province. For this reason, we oppose that grant, even though we cannot vote against the supplementary estimates at this time.

Mr. Ruston: Mr. Chairman, I think we spent some time on this -- I believe the date was in June, if I remember correctly. At that time we had quite a discussion on it. I think, no doubt, we supported it at that time and I am willing to stand up and support it here today.

I suppose we would all like to figure out some way to have that money back in the government coffers as soon as possible. No doubt it will remain with that industry because of the amount of employment it will bring to the district.

The strange thing about all this, I suppose, is what this much money, in grants of $28 million from Ontario and $40 million from the federal government, would have meant to the parts industry. They claim they need more money for investment to build more parts in Canada. I think the Reisman report on the auto pact claims that the auto parts industry is not doing as much expansion in Canada as it could do, although the parts manufacturers disagree with that to some extent.

The interesting part about this, Mr. Chairman, is that the members to our left, of course, have been adamantly opposed to this, to some extent. They are opposed to it in a way, but yet when the sod-breaking ceremony went on down there and the Minister of Intergovernmental Affairs (Mr. Wells) represented the Premier (Mr. Davis) who couldn’t be there --

Mr. Cooke: It was a free lunch at Ford.

Mr. Ruston: -- and the Prime Minister of Canada was there with the shovel --

Mr. Wildman: You have been around with a shovel for some time.

Mr. Ruston: -- and Mr. Bennett, the president of Ford Motor Company of Canada Limited, it was interesting that the members for Windsor-Riverside (Mr. Cooke) and Windsor-Sandwich (Mr. Bounsall) were following the Prime Minister around closely, hoping they would get a glimpse of the camera. There was the CBC cameraman going around; there was the member for Windsor-Sandwich -- he is only five foot five or something -- just checking around the Prime Minister, trying to get his face in the picture, you know. It was amazing.

And who was in the front row? Well, I thought maybe a Liberal -- I might get a chance to get up there some place -- but oh no, the member for Windsor-Riverside was right in the front row. Do you want it a little louder, Mr. Chairman? Right in the front row. He wanted to get his hand on that silver shovel.

Hon. F. S. Miller: Point of order, Mr. Chairman: I don’t mind his commenting about the NDP, but talking about short people is not fair.

Hon. Mr. Parrott: I agree with the Treasurer.

Mr. Ruston: Mr. Minister, I have no objection to short people. My wife is only five foot two, so I can’t talk against anybody who is short.

Hon. Mr. Parrott: And she is the boss.

Mr. Ruston: And she is the boss, yes.

Mr. Warner: Somebody should be.

Mr. Ruston: But, you know, in the debate in June, not one of the Windsor members spoke on that. The member for Windsor-Walkerville (Mr. B. Newman) did, but not one of the members from the third party. They didn’t want to get up and speak against their leader and then go down and help to break the sod. It’s strange what goes on there.

Mr. Chairman, I don’t want to take up any more of the time of the House.

Mr. Grande: You made your contribution.

Mr. Cooke: I find those comments very interesting. Ford paid for the lunch and I couldn’t -- the plant is being built in my riding.

Mr. Ruston: There’s no such thing as a free lunch.

Mr. Cooke: The member for Essex North really didn’t talk about the issue, and this is a very important issue in Ontario. It is very important to Windsor. Instead, he decided to spend his time talking about how I sat in the front row at the sod-turning of the Ford plant. It is a waste of his time and it shows what his understanding of this very important issue is.

Mr. Gaunt: It shows how you fellows act when you are not home.

Mr. Cooke: I want the members of this Legislature to understand, I know the people of Windsor-Riverside understand, that we in Windsor -- my colleague from Windsor-Sandwich (Mr. Bounsall) and myself -- very much appreciate the jobs that will be created in my riding. There is no doubt about that.

Hon. Mr. Parrott: Say it again.

Mr. Cooke: But we don’t think the end justifies the means; and in this case we disagree with the means by which that plant is there.

Mr. Warner: Your corporate giveaway program.

Mr. Cooke: The Treasurer tonight referred to the health of the auto industry --

Interjections.

Mr. Chairman: Order. The member for Windsor-Riverside has the floor.

Mr. Cooke: The Treasurer referred to the health of the industry in Windsor; and he mentioned a plant, Gulf and Western, which is established also in my riding. I would like to point out to the Treasurer -- if the Treasurer will listen -- that Gulf and Western, which produces bumpers for Chrysler in Windsor, has gene down from 400 employees just a few years ago to below 100 at present -- something like 85 as of the last layoffs that took place two weeks ago.

One of the reasons the number of employees at that plant has decreased is because Chrysler is sourcing those parts not from Windsor where they are available, but from Detroit. That’s how the auto pact works. Chrysler’s Mr. Hurly, when he decided to close down -- I shouldn’t say Mr Hurly decided, we all know those decisions are made in Detroit -- but when Chrysler decided to close down the truck plant in Windsor a year ago and eliminate 750 jobs, Ted Bounsall and I went and talked to the president of Chrysler Canada. He told us the problem with the auto parts sector was that if more companies were established and they could source more of the parts from Canada, they would; but there are just no more manufacturers.

Here is a case where Gulf and Western can produce the bumpers, but the latest contract from Chrysler in Windsor went to a Detroit firm rather than a Windsor firm. Of course, we know the federal government does nothing under the auto pact. As far as the provincial government is concerned, I have written to the Minister of Industry and Tourism and the letter I got back from him said, “That’s just a problem of the nature of a foreign-owned economy.”

Mr. Wildman: What is he doing about it?

Mr. Cooke: He is not doing anything about it, and I guess we can’t expect him to do anything about it. From the government’s past record we know what to expect.

Another parts manufacturer in my riding, Champion Spark Plug, which produces, obviously, spark plugs, has had layoffs this year; it had layoffs last year, and is expecting more layoffs in the future. Why are they expecting layoffs? Because the parent company in Toledo will not allow that plant to export any of its products outside Canada. It is only allowed to supply our own economy, our own market.

I again wrote the Minister of Industry and Tourism regarding that problem, and again he answered, “That’s the nature of a branch-plant economy.”

What is your government doing about the problems of a branch-plant economy? Nothing at all.

What was your government willing to do when Chrysler decided to eliminate 750 jobs by moving the truck plant from Windsor to Detroit? Nothing. You said, “There is nothing we can do about it, because the plant was 62 years old.” You knew as well as we did they were moving the production to a plant in Detroit, the age of which is the same, 62 years.

The Treasurer might remember that 25 years ago in Windsor the Ford Motor Company made another very major move, but that time they eliminated 5,000 jobs from Windsor. They moved those jobs and put 5,000 of our people out of work. Maybe the next time the Treasurer is in Windsor he will let me know, and I will take him on a tour of the Drouillard Road area that happens to form part of my riding. That happens to be the area that has the highest crime rate and is the most rundown area of our whole city. I suggest to him that the time that area started to decline was when Ford moved out and that is what we see from a multinational corporation that has no particular allegiance to any community or any country. They simply moved out of Windsor, picked up and left, and destroyed a very significant area of my riding and of the city of Windsor.

Mr. Warner: They pillage and you reward them for it.

Mr. Cooke: Let’s take a look at the grant and let’s take a look at the guarantees that the provincial government got from Ford.

Were there any guarantees that the contracts for construction of that plant would go to Canadian firms? No. I believe there were five companies that bid for the contract and out of those five two were foreign owned.

Were there any guarantees that the skilled tradesmen that would be required for that plant would be Canadians or people from Ontario? No, there was no guarantee of that. In fact the case is that by 1982 in Windsor we are going to need approximately 1,300 skilled tradesmen. We have a requirement for 300 right now. The facts are that the needs are not going to be met. They can’t be met. The people from the Ministry of Colleges and Universities, the industrial training branch, confirmed that to me when I talked to them.

So what is going to happen? It is already beginning to happen. The Ford Motor Company certainly will get their skilled tradesmen. They will put an ad in the papers and the skilled tradesmen from the small tool and die shops in Windsor and other areas will move to Ford because the salary rates are higher and the small tool and die companies will go out of our country and ask the federal government to loosen up the immigration rules so they can import workers. The Treasurer may say that won’t happen, but the facts are that the small tool and die companies have already approached the federal MPs in our area and the mayor of our city to see if that could be accomplished.

The results from the establishment of this plant have not all been positive, let me tell you, in Windsor.

Hon. F. S. Miller: My father was an immigrant. I don’t mind that.

Mr. Cooke: Well, I think the reason for spending $68 million on the Ford plant was not to import people to fill the jobs. The purpose was to create the 2,800 jobs for people in Ontario and Canada.

Mr. Warner: You will do whatever the Americans tell you to do.

Mr. Cooke: Let’s take a look at some of the things that have happened in Windsor since this plant was announced. The price of housing has gone up 25 per cent since August of last year.

Hon. F. S. Miller: It was depressed.

Mr. Cooke: The market might have been depressed but now if you want to bring our housing prices up to the price of housing in Toronto so that no one can afford a single-family dwelling -- if that’s what you want to see done then again another city will be faced with the people from low-income families and middle-income families who will just never be able to afford a single-family dwelling. The cost of housing has gone up 25 per cent since August of last year.

What is your government willing to do now to come in and make sure that lots are put on at a reasonable cost so that ordinary people, working people who move in to fill these jobs, can afford housing?

I would like to know from the Treasurer tonight what the actual cost of establishing that plant in Windsor is. We know there was a $68 million grant. What about the other money -- the money that has to be put in to speed up the construction of the expressway -- millions of dollars to supply the other services that had to go in? I would suspect that the cost of that plant, with all the services taken into consideration, is well over $100 million. A lot of the initial money is going to have to come from the mill rate, local property taxes, and we will not see the benefits of increased revenue for the city until well into the future. It is certainly not going to happen until 1982 or thereabouts.

The Treasurer thinks that the government of Ontario has done something that’s very popular all across Ontario and I would suspect that he thinks it is very popular in Windsor. I might indicate to the Treasurer that in my last Queen’s Park report one of the questions in the questionnaire was, “Do you favour government grants to companies in order to create jobs; i.e. Ford?” Well, I got 600 replies and 47 per cent of the people that replied agreed and 46 per cent were opposed. The people in Windsor and the people in Windsor-Riverside are very divided on whether the proper means was used to get this plant.

Hon. Mr. Wells: It was 75 per cent in favour in my riding.

Mr. Cooke: Finally, Mr. Chairman, I would like to point out to the Treasurer and the members of the Legislature that many people in Windsor laugh at the provincial government, and the federal government and even some of the contractors and people who are going to be supplying machines to Ford are laughing, because Ford were already beginning negotiations with some of the machine companies before the government ever gave the grant.

[10:15]

We knew that plant was coming into Windsor, and I suspect if the provincial government and the federal government had really pushed Ford to the wall that plant would be built. Ford has owned that property for many years and it would have been there anyway.

Mr. Warner: The government was taken, you know it.

Mr. Cooke: Instead, $68 million has been given to Ford. Now in Windsor we’re having -- as we are all across the province of Ontario -- hospital cutbacks, beds cut back. People are phoning my constituency office and saying: “If we can afford to give $68 million to Ford, why can we only afford to give one per cent to the children’s aid society as an increase in Windsor?” That’s what it is, because you’re penalizing them for over-expenditures last year.

Hon. F. S. Miller: That is a little different.

Mr. Cooke: You know the process that’s used with children’s aid societies.

Mr. Warner: You have to do what Ford tells you.

Mr. Cooke: In the past, the provincial government has picked up the deficit. This year, because of your restraint program -- you’ve used a different procedure.

People of Windsor call my constituency office and ask: “Why should people have to wait in line and stay overnight in emergency rooms in hospitals when you give $68 million to Ford Motor Company, a company that’s made $.5 billion profit in the last four years?”

I could go on and on and on, because this whole issue is very upsetting to me.

Mr. Kerrie: Please don’t.

Mr. Cooke: I do want to conclude by saying we in Windsor are very pleased we’re going to get 2,800 jobs, but we don’t think the end justifies the means.

Mr. Kerrio: You can’t have it both ways.

Mr. B. Newman: Coming from the city of Windsor I certainly have a responsibility to make a few comments concerning the $68 million that is being given by the two levels of government to the establishment of the Ford Motor Company plant in the community.

I don’t agree with giving money to buy any type of industry, but at this time it looked as if our backs were against the wall and we either had to do this or we may have lost it. I say “may,” because I don’t think that Ford Motor Company would have gone anywhere in the province of Ontario or even in any of the US states. Their production from this plant was essentially for the US, and common sense would say it would be better to be manufacturing those motors or engines and shipping them approximately 15 or 20 miles to the Dearborn plant, or maybe 35 miles to a Flat Rock plant, rather than bringing them in from Ohio, which is possibly three or four times the distance.

I think the plant would have been established in the city of Windsor rather than in the state of Ohio, in spite of the incentives Ohio may have offered to the plant. We, in Windsor, appreciate the plant coming in. Even though we don’t appreciate buying a plant, we think that in this instance we didn’t really have a choice, and the government didn’t think it had a choice.

But does the minister realize that General Motors is spending $435 million on updating their transmission plant without one cent from the provincial and/or federal government? There’s a $435 million addition going on that plant and I think it’s going to create about 1,700 jobs in the Windsor area.

One of the things that disturbs me is we’re always talking about dollar balance of trade and saying if we export $3 billion worth of products from Canada we should balance it off by importing approximately the same from the US. Instead of looking at the dollar point of view, I would rather see us look at the job point of view. If our products are made by providing, let’s say 100 million job hours for a whole year, then we should be importing from that other jurisdiction the same amount we sell to them. If we consume 10 per cent of the automotive manufacturing in the North American continent, then we should be exporting 10 per cent.

Instead of in dollars and cents, we should have more of a balance in jobs. I know one can’t strictly have it as jobs because some jobs don’t balance off as easily as we think they do. When it comes to parts manufacturing, I understand that parts manufacturing is highly automated, so it may not create as many jobs as the assembly. But when we talk to our American friends, we should not only ask for jobs for the assembling of cars and manufacturing of parts, we should also ask for the jobs that are involved in research and development.

That’s a thing we’re forgetting about. We’re allowing all of that to be done in the United States, whereas we should be having our share of it. All I ask for is our fair share, I don’t necessarily say in Ontario, which would be the logical place, but at least in Canada, preferably in Ontario.

This issue has been debated earlier this year, or sometime last year. I don’t intend to make any more comments on this, other than to say we appreciate the fact that the Ford Motor Company is setting up there.

Mr. Warner: You have a new position now.

Mr. B. Newman: I don’t think it’s going to create the number of jobs that you mention. I hope it does, I hope it creates a lot more.

Mr. Cooke: Mark MacGuigan says it’s going to produce 16,000 jobs.

Mr. B. Newman: But it is causing one problem that has not probably been mentioned by any of the previous speakers. We are getting a lot of people coming into the community thinking that the jobs are going to be there tomorrow. We know that the jobs won’t be available up until the time the plant has been completed and has been in operation.

As far as the E. C. Row Expressway is concerned, actually I was on city council at the time we had planned that. That was supposed to have been completed, if I am not mistaken, some six or seven years ago. It is now probably going to be completed, or almost completed, as a result of a need for this E. C. Row Expressway because the products from the Ford plant are essentially going to use the E. C. Row Expressway to Huron Church Road and across the Ambassador Bridge to the US -- not all of the products but some of the products.

That’s the complete content of my remarks; I hope the minister makes some reply concerning them.

Mr. Warner: On today’s position.

Hon. F. S. Miller: I’d like briefly to respond to most of the speakers. I will begin by saying that I don’t think the previous Treasurer, nor myself, basically believe in giving money to corporations.

Mr. Warner: But you did.

Mr. di Santo: That’s what you do.

Hon. F. S. Miller: The fact remains, as I’ve said, that the problem is not just Canada-US, it has become worldwide.

Mr. Warner: They’re lined up at the door.

Hon. F. S. Miller: I was reading last week in the London Times about the dealings going on currently in Europe between Italy, Spain, France, Germany and now even eastern communist countries --

Mr. Samis: Darcy McKeough couldn’t stomach it and left.

Hon. F. S. Miller: -- to try to get a major plant from Ford over there. It makes our money look like peanuts.

Mr. Samis: That doesn’t make it right.

Mr. Wildman: Multinational pirates.

Hon. F. S. Miller: I’ve looked at the letter the Leader of the Opposition (Mr. S. Smith) wrote to the Prime Minister of Canada which was read into the record here, which said in effect: “For goodness’ sake, don’t let Ontario blow this one. Make sure you give them money and Ontario gives them money.” I looked at some of the comments from members of the NDP from Windsor around the time the Ford deal started to be discussed, stating that we had to do something like grants, giveaways or whatever it was.

Mr. Samis: Let’s hear it again.

Mr. Warner: An NDP member never said that.

Mr. Grande: Go on and quote them.

Mr. Warner: That’s not true and you know it.

Hon. F. S. Miller: “Would the minister consider making an analysis of what parts may well be produced in this area and think of giving whatever loan incentives may be necessary to encourage the manufacturers in Ontario to move into those proven areas?”

Mr. Wildman: That’s not a grant or a giveaway.

Mr. Warner: Loans? You wouldn’t know the difference between a loan and a giveaway.

Hon. F. S. Miller: That was the member of the NDP for Windsor-Sandwich (Mr. Bounsall).

Mr. Lawlor: You think you can blind us with your jacket, don’t you?

Hon. F. S. Miller: I’m going to finish, with some luck. I’ve tried to remain calm and quiet. Obviously small business is the part we want to see grow in Canada. Obviously small business has to be the focus of my employment development fund. Those are the people we have to see grow to become big.

Mr. Lawlor: Taking partisan advantage. Talk about giveaways. You’d sell the province down the river to whatever multinational came along.

Hon. F. S. Miller: There’s no use pretending a small business can become a manufacturer of automobiles. Even the big companies are having trouble.

Mr. Lawlor: You can’t even look serious, or you shouldn’t.

Hon. F. S. Miller: Chrysler is having trouble surviving. American Motors is having trouble surviving. Ford, in spite of the profits referred to, has had some troubles.

Mr. Warner: Give them some more money.

Mr. Lawlor: They are all terrifyingly in debt. Everybody is in debt to them.

Hon. F. S. Miller: You talked about equity. Basically equity is something socialists believe the state should have. I’m not totally opposed. There are days and times when equity is justified.

Mr. Lawlor: Equity.

Mr. Warner: To people. Only to people.

Mr. Lawlor: When you come to that, talking relates --

Hon. F. S. Miller: Please, my friend. Your poems may be great but your interjections are lousy. Full of sound and fury, signifying nothing.

Mr. Lawlor: Isn’t it funny what perceptions we have?

Hon. F. S. Miller: Ah, perceptions, projections, perpetuations.

Mr. B. Newman: He’s going to write another book.

Mr. Eakins: Will this cut back on Ontario Development Corporation funding?

Hon. F. S. Miller: I won’t comment on that because that will be properly a budgetary item.

Mr. Lawlor: You’d sell your province down the river.

Hon. F. S. Miller: My friend from Lakeshore, we’ll miss you. We’ll miss you.

Mr. Lawlor: With your atavistic throwback, your antediluvian --

Hon. F. S. Miller: I am not an atavist. I came from England.

Mr. Chairman: Order. Order.

Mr. Grande: Top that.

Hon. F. S. Miller: The real return to a capitalistic government is the employment opportunities offered in the country --

Mr. Samis: Capitalist. Return to Darcy now.

Hon. F. 5. Miller: -- the return to the state in its legal involvement, the collection of taxes from employed people, the collection of taxes from corporations that are making profits --

Mr. Warner: Everyone chokes on that.

Hon. F. S. Miller: -- the general wealth generated by having a parts producer of this nature in Canada, basically exporting to the States, buying many of its supplies from Canadian companies.

Mr. Warner: Just keep giving them money, handing out money.

Hon. F. S. Miller: Remember, the independent parts manufacturers in Canada are basically Canadian companies. These people will be given a basic incentive by having a major parts components plant here.

Mr. Warner: You were conned.

Hon. F. S. Miller: It’s the parts side we are in deficit on. It has been said many times: $3.2 billion deficit in parts; $2 billion surplus on the production or assembly of automobiles.

Mr. Warner: You were conned. They took you.

Hon. F. S. Miller: I would only suggest that if you got a 46-43 split on your return, it really wasn’t characteristic of the southwestern Ontario reaction.

Mr. Warner: Don’t ever wander down the midway at the CNE.

Hon. F. S. Miller: I have no idea what other reactions people got, but we also did some checking. I can tell you that anything I heard from members said 60 to 70 per cent of the people in southwestern Ontario were firmly in favour.

Mr. di Santo: Bravo. Bravo.

Mr. Grande: That’s 130 per cent. How did you get that?

Hon. F. S. Miller: I was in Chatham during the election campaign down there, and I tell you, the fellows from International Harvester understood there were jobs being created and that they were profiting.

Mr. Wildman: There was one guy in Chatham who didn’t agree with it though.

Mr. di Santo: Darcy McKeough.

Mr. Wildman: Right.

Mr. Warner: Tell us what Darcy said.

Mr. Samis: The member for Chatham-Kent.

Hon. F. S. Miller: We have in our agreement the fact that Ford must shop and buy Canadian, providing Canadian components are available and competitive in quality, performance and price in that plant.

Mr. Warner: Don’t ever wander down the midway. They’ll pick your pockets.

Hon. F. S. Miller: You know, if I listened to the arguments of the member for Windsor-Riverside, really, we should go down and implore plants to close so housing would drop out of sight, so there would be no need to build any roads, so that in fact we could have a nice return, but we had to do nothing and nothing had to be invested by any municipality in the services that are required for industry.

Mr. Cooke: Get serious.

Mr. Samis: Straight face.

Hon. F. S. Miller: Read what you said tomorrow, and if you weren’t telling me that in fact every municipality --

Mr. Warner: Go back to Santa’s Village.

Hon. F. S. Miller: -- that is lucky enough to have an industry come in faces certain requirements for infrastructure --

Mr. Cooke: Now get in there and build some housing and get your Minister of Housing (Mr. Bennett) to do his job.

Hon. F. S. Miller: -- and I’ll tell you that most of them are just delighted to have the problem of providing infrastructure so there will be jobs for the citizens in that community. Windsor is no different.

Mr. Warner: You look better in Santa’s Village.

Hon. F. S. Miller: My colleague on my left just gave $3.3 million extra to the city of Windsor.

Mr. Cooke: What about the $50 million we lost, Mr. Treasurer?

Hon. F. S. Miller: No one can ever say we chose Windsor and assisted it because a lot of our own party members were there.

Mr. Cooke: And you will never ever; remember.

Hon. F. S. Miller: This party showed it was willing to help a community in Ontario because we represent all of the people in Ontario, not just those communities where people elect our members.

Vote 1103A agreed to.

On motion by Hon. Mr. Welch, the committee of supply reported certain resolutions.

On motion by Hon. Mr. Welch, the House adjourned at 10:31 p.m.