Legislative Assembly of Ontario

The House met at 2 p.m.

Prayers.

STATEMENTS BY THE MINISTRY

BELL CANADA RATES

Hon. Mr. Snow: Mr. Speaker, I would like to reply to a question posed in the House on Friday by the Leader of the Opposition (Mr. S. Smith) concerning the position of the government regarding Bell Canada’s Saudi Arabian contract.

At the outset I would like to clear up some confusion in the question. We have not changed our mind about how the revenues from this contract should be treated by the regulator. At the original hearing in 1978, Ontario intervened on behalf of telecommunications users in this province, requesting that Bell show cause why rates in particular should be increased. During the hearing, a range of issues arising out of Bell’s request for higher rates was dealt with. One of the issues was the Saudi contract.

On the general question of Bell’s request for increased rates, Ontario took the position that what Bell was asking for was not justified and would be unfair to the subscribers. We told the commission that Bell’s request should be reduced significantly.

On the specific issue of the treatment of the Saudi revenues for regulatory purposes, we found the confidential procedures used to review the contract during the Canadian Radio-Television and Telecommunications Commission hearings to be unacceptable. We could not, therefore, take any position on the matter during our final argument.

Following the hearings and CRTC’s decision to include the Saudi revenues as normal Bell revenues, we reviewed the situation carefully. We concluded that a central issue was whether a regulatory principle was being established that could dissuade regulated telecommunications carriers from operating in foreign markets.

In view of the fact that the international market for telecommunications equipment and services is expanding rapidly, we did not want to see Canada cut out of potential business because of negative internal policies. There are many great benefits to be gained in terms of jobs and revenues for Canada.

The government of Ontario strongly believes that domestic industry should be encouraged to compete in world markets and to export Canadian technology and expertise. We have a great deal of both in our telecommunications companies; in fact, we are world leaders in many areas. For this reason we asked the CRTC and the federal government to resolve Bell’s appeal in a way that would encourage Bell and other high-technology companies to export.

The Leader of the Opposition has been talking a lot lately about the need for an industrial strategy, and on April 9 released a rather lengthy document entitled An Industrial Strategy for Ontario. I note on page 58 that he singles out telecommunications as one of the sectors that should be actively supported.

I agree with the Leader of the Opposition. In fact, for several years now I have maintained that the telecommunications sector is a key part of Ontario’s industrial base and one in which we can be internationally competitive. We are making sure, through our actions in policies, regulatory hearings and wherever possible, that we keep it that way.

In acting on the question of Bell Canada’s revenues, we believe we are away ahead of the opposition in attempting to get a policy and regulatory framework that provides incentives and the positive features required for a successful industrial strategy.

In conclusion, there are two issues here. We believe strongly that consumers should not be paying too much for the telecommunications services they receive. In our interventions on Bell and other rate hearings, we have addressed this issue in the consumers’ interest.

On the other hand, we must also look at the potential benefits in terms of jobs and the balance of payments that can come from our telecommunications firms’ securing contracts in foreign markets. We should not be putting unnecessary obstacles in the way of firms operating offshore. I think we have been dealing with both issues in a balanced and responsible manner.

INCO DISPUTE

Hon. Mr. Elgie: Mr. Speaker, as members know, a memorandum of settlement was signed yesterday by Inco Metals Limited and local 6500 of the United Steelworkers of America. The memorandum, of course, is subject to ratification, and I understand that membership ratification votes will be held in Sudbury later this week. Because ratification has not occurred, I do not wish to say anything that might at this time be construed as interfering with procedures yet to be concluded.

However, in rising today, I do wish to express my gratitude to and admiration for the bargaining committees on both sides who through difficult times have laboured long and earnestly in search of an acceptable basis for settlement.

If I may be permitted to do so, I think I should also give credit to two mediators from my ministry, Vic Pathe, executive director, industrial relations, and Ray Illing, a senior mediator with the ministry. Their patience and wisdom, already publicly acknowledged, contributed greatly to yesterday’s achievement. From the earliest stages, and indeed throughout the long and arduous process, the Premier (Mr. Davis) and I maintained an active interest and, when appropriate, involvement in the discussions. In the final analysis, however, full credit must be given to the bargaining parties, who have been able to fashion their own voluntary solution.

I am sure that all members will share my hope and expectation that this long dispute is near an end. Judging from media reports, this sentiment is shared as well by all the citizens of the Sudbury basin who have as well been hoping and praying for an early resolution.

FOREST REGENERATION

Hon. Mr. Auld: Mr. Speaker, I want to advise the House today of some recent developments regarding my ministry’s forest management program. While an article in the Toronto Star on Saturday was by and large accurate and fair, I feel it nevertheless may have left the impression with many readers that we have reached a crisis situation in our forest industry.

In offering my assessment of that story, I would hasten to add that I do not necessarily agree with the statements made in that story by two of the members opposite. I believe that for financial reasons we have not progressed as quickly as we would like. We do believe, however --

Mr. T. P. Reid: You have gone backwards.

Hon. Mr. Auld: -- that we have dealt with the situation openly and constructively and that we are far from a crisis situation.

Mr. Wildman: Only 50 per cent regeneration.

Hon. Mr. Auld: As some honourable members of this House are aware, we are taking steps to overcome the separation of harvesting and silviculture, and to privatize much of the forest management work through forest management agreements with the forest industry.

Mr. S. Smith: It used to be private, and it didn’t work either.

Hon. Mr. Auld: I want to advise the House today that the Treasurer has recently given his support to a $4.3 million expenditure for the forest management agreement initiative. This will cover three agreements with private companies in 1979 at the same cost as my ministry would incur in carrying out the work itself. We believe, Mr. Speaker, that this is another example of the government’s commitment to privatization and to our commitment to forest replacement and management. The proposed $4.3 million expenditure this year is part of my ministry’s proposal to spend $50 million and close the current regeneration gap by 1985.

Mr. T. P. Reid: It will never happen.

Hon. Mr. Auld: This proposal is now before Management Board.

While, as I have stated, we have not been able to move as quickly as we would like, I want to emphasize that Ontario is the front-runner in Canada as far as overall forest management is concerned.

Mr. Bradley: You need a third hand to pat yourself on the back.

Hon. Mr. Auld: The regeneration gap and the continuity of funding are problems faced by every province in Canada. Ontario has led all of Canada in forest policy and programs since the end of the Second World War.

Mr. T. P. Reid: It must be pretty bad in other jurisdictions.

Hon. Mr. Auld: As members of this House will appreciate, I’m sure, it is difficult to make long-term funding commitments at this time. As a result, we are looking at several options in addition to outright government funding.

As members know, British Columbia and Alberta do not fund their forestry programs from general revenues. We are currently taking a look at stumpage offset and nominal stumpage methods our colleagues in those provinces now use. In addition, I will be seeking a meeting soon with my counterpart in Ottawa to explore the possibility of tax options whereby moneys spent by a forest company for forest management work would be offset through tax credits.

While I have acknowledged some difficulties, I want to take this opportunity, Mr. Speaker, to remind the House that since the government took over forest management responsibilities in 1962, the regeneration has increased from a few thousand acres to 198,000 acres in 1978 alone.

Mr. T. P. Reid: And we cut 400,000.

Mr. Wildman: How many were cut?

Hon. Mr. Auld: I also want to emphasize today that this government remains committed to a forest management program that is now second to none in this country.

DECLINING ENROLMENT

Hon. Miss Stephenson: Mr. Speaker, on Friday morning, in response to a question I used the figure 15,000 as the figure of declining enrolment in the elementary school system in the city of Toronto. That figure is incorrect, because that is the figure for the North York school enrolment decline. The figure for Toronto between the year 1974 and September 1979 is 12,000.

ORAL QUESTIONS

BELL CANADA RATES

Mr. S. Smith: Mr. Speaker, I would like to question the Minister of Transportation and Communications to find out if he really believes what he has said in the statement he has made today. In the first place, can the minister tell us why he said his department did not change its mind during the course of the hearing, when the lawyer for the Ministry of Transportation and Communications, in front of the Canadian Radio- Television and Telecommunications Commission, has said, and I quote:

“A word with regard to the discussion that Mr. Saunders” -- that is the Bell person -- “had with the panel this morning with regard to the Saudi Arabian matter is simply this. Having heard Mr. Saunders, having heard his comments, we still don’t understand how Bell Canada’s subscribers in the long run can possibly be insulated from the outcome of the Saudi Arabian undertaking, whether it turns out to be good or whether it turns out to be bad. We do not believe that the subscribers can be insulated from the effects of this contract.”

That’s the lawyer for the ministry. Why does the minister say to this House that there is no change in position when the change is perfectly obvious?

Hon. Mr. Snow: Mr. Speaker, I don’t think there is anything in that statement that the honourable member has read that indicates there is any change whatsoever in the position of this government on this matter.

[2:15]

Mr. S. Smith: Did the minister not hear that I said the lawyer representing the case for the government said that one cannot insulate the subscribers, and that the government then went before the cabinet to say the subscribers should be insulated from the profits and the profits should go directly to the shareholders without having effect on the revenues? If, in fact, his case is that it will allow more telecommunications equipment to be sold from Canada, may I quote to the minister from Bell’s annual report on this matter, in which it says that the major role of Bell Canada and its more than 600 employees in Saudi Arabia is to establish and manage the organization that will operate the system? Switching, outside plant and station equipment are being provided by Philips and L. M. Ericsson, two Scandinavian or Dutch companies.

Hon. Mr. Snow: Certainly I am well aware of that fact. There is still a considerable benefit to Canada from the tremendous payments that are being received by Bell for their expertise, for their technology and for a certain amount of infrastructure that is being supplied from Canada, although we realize that Saudi Arabia awarded the contracts for the major equipment to the companies the Leader of the Opposition mentioned.

Mr. S. Smith: By way of a supplementary, again since the minister seems so unaware of these matters, does the minister not recognize that what Saudi Arabia wanted from Bell Canada was access to the AT and T training manuals which they could get through the Canadian company and that Saudi Arabia was not willing to deal with a separate subsidiary of Bell but wanted Bell Canada to do the job because it is in a monopoly service situation in Canada?

Does the minister not recognize that if Bell is going to get those benefits then the subscribers ought to have some of the benefits as well and that they shouldn’t simply go to the shareholders, leaving the rest of us with higher bills to pay? The government lawyer was right the first time.

Hon. Mr. Snow: I don’t doubt very much that the lawyer was right. The lawyer made a statement that I have no trouble agreeing with, that there cannot be a total separation or insulation of outside contracts from the subscriber. But at no time did he say that the total revenues from any outside contract should be used to offset local expenditures, which is actually what we’re talking about. I don’t think there’s any conflict whatsoever. I think the Leader of the Opposition is talking out of both sides of his face at the same time.

Hon. Miss Stephenson: As usual.

Mr. Kerrio: We have to get some benefit or what good is it?

Hon. Mr. Snow: He says he wants to export technology and bring a great deal of money to the Canadian economy and employ a great number of Canadians.

Mr. S. Smith: We’re not exporting anything, Sweden is.

Hon. Mr. Snow: But he doesn’t want that, it seems. At one minute he is saying that is what he does want, and at the next minute he’s opposing it.

Mr. S. Smith: There is not an ounce of Canadian technology going there and the minister knows it.

For the benefit of the Minister of Education, who isn’t aware of the location of Philips and Ericsson, they’re in Holland and Sweden.

Hon. Miss Stephenson: Of course I know. Don’t be so silly and don’t be so condescending.

Mr. McClellan: Arrogance meets condescension.

REED PAPER COMPANY: FOREST REGENERATION

Mr. S. Smith: I have a question of the Minister of Natural Resources with regard to his forest policy. First of all, can the minister tell me when we are going to get the figures and the agreement he promised me some three weeks ago regarding the allowable cut and the actual cut for various species on the various timber limits that Reed Limited has? I asked for that information on April 19 and the minister said he would be delighted to supply it.

Mrs. Campbell: When he can find them.

Hon. Mr. Auld: It has taken a little time to get them in the form that was requested. In fact, one of the breakdowns in part of the question is just unanswerable in a short length of time, but I would assume that the answers that we have been able to put together would be tabled this week.

Mr. S. Smith: When am I going to be able to get it?

Hon. Mr. Auld: I would expect that they would be tabled towards the end of this week.

Mr. S. Smith: Can the minister explain the priorities that have moved his government over the years to end up in a situation where, despite years of warning from every aspect of the forest industry, we find ourselves still allowing hundreds of square miles to go without being reforested, even though they have been cut? What are the priorities that allow the government to offer $100 million to protect the companies when it can’t find $5.6 million extra to protect the resource that belongs to the people and to our children’s future? What kind of priorities are those?

Mr. Kerrio: Let Mother Nature do it.

Hon. Mr. Auld: Mr. Speaker, first of all, it became apparent to the province in 1962, as I mentioned a few moments ago, that something much more had to be done about regeneration. However, a very intensive study was undertaken under the chairmanship of Professor Armson, who is now a special advisor, to determine which way this could best be done. Without making an estimates speech, I would say one thing that became quite apparent was that cutting and regeneration go hand in hand, forestry practices can’t be separated.

Mr. T. P. Reid: It’s called forest management.

Hon. Mr. Auld: That is the reason for the amendments to the Crown Timber Act which were given to the House for first reading last week. It is the reason for the program we have embarked on in having the companies do this work in their limits while the crown will continue to do it in crown management units. This is not a $5 million program. We estimate when it is running full force it will be something in the order of between $20 million and $30 million.

Mr. Wildman: Mr. Speaker, would the minister not agree that the figure 198,000 acres regenerated doesn’t mean anything by itself unless he also tells us the total cutover area since 1962? Is the minister, in his statement, committing the government to sustained-yield operations by 1985? If so, how is he going to fit into the position of the independent sawmill operators in their criticisms of the present system and their argument that they should have a greater role?

Hon. Mr. Auld: Mr. Speaker, I think those are questions which could well be addressed to the ministry when we’re doing our estimates, which I understand we start in a very short time.

Mr. Warner: Go on, you just made a statement today.

Hon. Mr. Auld: They’re really a matter of detail. However, as far as the independent sawmill operators are concerned, and I’ve met with them as recently as about two weeks ago --

Mr. Swart: How many acres were included in the cutover?

Hon. Mr. Auld: -- we have indicated to them, as I said a moment ago, that we will be doing the regeneration in the crown units, which is where most of their wood comes from. Their other wood, the material they buy on third-party agreements from the pulp and paper companies, will come from the areas that are regenerated by those companies under whatever arrangement we come to.

Finally, I have a meeting this afternoon at four o’clock with the Ontario Forest Industries Association, and I believe we have finally ironed out pretty well all the points of disagreement in our proposed agreement. As I said a couple of weeks ago, I hope we will be signing our first agreement very shortly.

Mr. T. P. Reid: Is the minister aware that for the last 30 years we have been falling behind by 100,000 acres, taking into account either natural or man-made regeneration of the forest?

Does he realize that on the regeneration that is being done there is only about a 50 per cent success rate.

Mr. Wildman: That’s right; 50 per cent a year.

Mr. T. P. Reid: So we’re falling behind 150,000 to 200,000 acres a year in regeneration? The minister has yet to tell this House how his ministry is going to make up that gap and ensure that those mills in northern Ontario can continue to operate for the next 30 or 40 years.

Mr. Warner: Tell us about the Bramalea charter.

Hon. Mr. Auld: It was mentioned in the Saturday Star story, which I must admit I didn’t see until I returned here this morning; we indicated some time ago that our basic approach was to plant two trees for every one cut.

Mr. S. Smith: We heard that.

Hon. Mr. Auld: We still have that target and we’re going to meet it.

MINING COMMUNITIES

Mr. Martel: Mr. Speaker, I have a question of the Treasurer.

Mr. Havrot: New leader over there?

Mr. MacDonald: We have reserves over here, which is more than you can say for yours.

Mr. Martel: On November 3, 1977, the Premier made a statement. This is an excerpt from it:

“In recognition of the gravity and the complexity of the problems facing Sudbury and other mining communities, the government will establish a cabinet committee on the economic future of mining communities to consider those short-term and long-term measures which may be appropriate for our government and other measures which may be recommended to the government of Canada.”

Could the Treasurer tell me, in view of the fact that he was chairman of that committee, how frequently it met, who has taken his place as chairman now that he has gone on to greater expectations, and when he will be in a position to table a report indicating what his short-term and long-term proposals are for those mining communities?

Hon. F. S. Miller: Mr. Speaker, the committee met reasonably regularly; I would have guessed about every two weeks at that point during the first two or three months, or perhaps even six months. It generally reported quite quickly to one of two points; since it was a committee of cabinet, it was reporting to the policy field as required and, at times, directly to cabinet.

It is my understanding, and it would need to be confirmed by the minister involved, that the Minister of Natural Resources assumed that role, since I was Minister of Natural Resources at the time; I know that I relinquished it when I was made Treasurer.

Mr. Martel: A supplementary: There was a commitment that the minister would develop short-term solutions and, it would be hoped, long-term solutions for mining communities faced with problems. He has not answered that part of the question as to what those are going to be.

In view of the fact that National Steel is closing its doors in the town of Capreol on May 15, can he tell me how the goals or programs that he has established will be implemented to assist (a) the workers in the municipality of Capreol and (b) the municipality of Capreol itself?

Hon. F. S. Miller: It might be wise if the part on Capreol were redirected. I think the Minister of Labour (Mr. Elgie) was involved in the mine up there.

An hon. member: What about the minister’s recommendations?

Interjections.

Mr. Martel: I can redirect it, but I know the involvement of the Minister of Labour, which has been in an effort to try to keep the plant open. I want to know what the Treasurer is going to do (a) for the workers and (b) for the municipality of Capreol, which now is going to be confronted with about 140 vacant homes and a tax bill, because there is going to be a shortfall in the tax revenues which the municipality had not anticipated and because it built on to the schools and it built a new subdivision just two years ago.

Hon. F. S. Miller: The Capreol issue came up after the change in my position; that is why I was referring that part of the question. I could talk at length about Marmora. I could talk at length about the meetings we had at Atikokan. I visited Sudbury at least once, and possibly twice. We had meetings with the Sudbury group and a number of others in the course of the action. The members know, as well as I do, that solutions are not easily found in that business.

Mr. T. P. Reid: A supplementary, Mr. Speaker: The Treasurer might be aware that I had this question on the order paper about three months ago. Will he not admit that the whole policy of providing any kind of assistance to one-industry, northern communities was nothing but a sham to try to get the government off the hook, and it was such a sham that the Provincial Secretary for Resources Development (Mr. Brunelle) was not even appointed to that committee? In fact, will he not admit that nothing has been set down to provide any guidelines for communities that are facing unemployment problems because of mine or mill shutdowns?

Hon. F. S. Miller: No, Mr. Speaker, I disagree completely with that comment. For example, the day we visited the town of Atikokan, in the member’s area, we arranged for a grant to be given for industrial relocation or studies through the Ministry of Northern Affairs.

The Provincial Secretary for Resources Development did sit on the committee, therefore, the member’s allegation that he did not is not correct. I think the provincial secretary attended almost every meeting we ever had of that committee -- in my presence anyway; so I would suggest to the member that he is not elucidating the facts as they occurred.

Mr. Speaker: A final supplementary.

Mr. Wildman: Mr. Speaker, are we to understand from the minister’s replies that this committee, if and when it did meet, just talked about particular problems in particular communities and did not try to develop any general policy for one-industry towns in the north, which is what it was set up for?

[2:30]

Hon. F. S. Miller: No, Mr. Speaker. But when one has immediate, pressing problems, those, obviously are those one deals with in the immediate context.

Mr. Warner: You did nothing.

Mr. Laughren: You are washing your hands of it.

Hon. F. S. Miller: It’s easy to sit there and complain, but I tell the honourable member there were some problems that were difficult to deal with.

Mr. Martel: It’s easy to sit there and pronounce, too.

Mr. Laughren: You’re squirming.

Mr. Warner: The worm wriggles on the hook.

Hon. F. S. Miller: When those mines were started in Atikokan 35 years ago it was predicted that they would be exhausted just about now. There are different problems in Capreol, totally different problems. I understand it was a very profitable mine at one point, and very well run.

Mr. Wildman: What are you doing for Elliot Lake?

Hon. F. S. Miller: Marmora fits the Atikokan category, and I think progress is being made at Marmora.

Mr. S. Smith: You’ve been the government for 36 years.

Hon. F. S. Miller: I understand studies are going on right now or a company is continuing to use the facilities.

Mr. Van Horne: A little less talk and a little more action over there.

Mr. Warner: A comparative failure.

Hon. F. S. Miller: We got agreement, for example, from the company that owned that mine, Bethlehem Steel, to work with the ministry in keeping the equipment on site in good shape and in carrying on research in eastern Ontario, through the Ministry of Natural Resources, into alternative ores that could be developed there.

I think the kinds of claims the members are making that nothing has happened are totally false.

Mr. Warner: Show us the report.

Mr. Laughren: The flimflam man from Muskoka.

Mr. Speaker: A new question, the member for Sudbury East.

Mr. Martel: The Treasurer said it was short-term --

Mr. Bolan: That’s because he’s a short-term Treasurer.

Mr. Martel: -- but they have had 18 months since the committee was established.

Mr. Speaker: A new question.

HOCKEY VIOLENCE

Mr. Martel: To the Deputy Premier, in view of the fact that his colleague the Minister of Culture and Recreation (Mr. Baetz) is not here: Recently I received a letter from a Dr. John Elliott, assistant professor of sociology at Laurentian University, concerning the hockey violence questionnaire sent out by the Deputy Premier’s colleague. In part, that letter makes the following comment:

“The number 100,000 may sound politically expedient, more than anything else. If this number is itself a sample, then it is a waste. Not that many are required. The rate of return for any mail questionnaire is usually 15 to 20 per cent.”

In view of Dr. Elliott’s comment, could the Deputy Premier find out for me how many answers we have received and what the reports indicate with respect to the attitude apparent towards serious hockey violence, particularly in view of all the hockey experts and players, such as Bobby Hull, George Armstrong and Bill White, who maintain it is rampant with viciousness?

Hon. Mr. Welch: Mr. Speaker, I know all members of the House appreciate the very keen and personal concern which has been expressed by the honourable member himself about this matter.

Mr. T. P. Reid: In other words, you don’t know.

Hon. Mr. Welch: Indeed, the honourable member will recall that the Minister of Culture and Recreation made a fairly full statement not too many days after that particular expression of concern by the honourable member.

I think the ministry wanted to make sure there was a very wide circulation of the questionnaires in order to provide people with the opportunity to respond. No doubt the minister, consistent with his statement, will want to share the results of that with all members of the House once he feels he is in a position to correctly assess and evaluate what the results of that questionnaire have produced.

Mr. Warner: You speak as well as he does.

Mr. Martel: The statement made by the minister at the time was fraught with error, and I point out another one today. In his statement he said there were 17 questions in the questionnaire; in fact there were 23. It gives me some concern, particularly when we’re talking about hockey violence, that only three of the 23 questions dealt with hockey violence.

Could the Deputy Premier find out for me who prepared the statement; who prepared the questionnaire; and when we’re going to get serious about resolving the problems of hockey violence as it affects youngsters?

Hon. Mr. Welch: Now that these questions are on the record I assure the honourable member that I will draw them to the attention of my colleague the minister.

Mr. M. Davidson: Supplementary: Would the minister not agree that a proper assessment of the questionnaire that was sent out is not possible, given that some homes have received as many as five or six copies of the questionnaire, my home being one of them?

Hon. Mr. Welch: I would assume that only one response would come from that particular household then.

Mr. Samis: They know who’s important in Cambridge.

Mr. T. P. Reid: They gave him four to practice on.

Mr. Eakins: He must have used the Tory mailing list.

Hon. Mr. Welch: Obviously, I’m not in a position to comment on this, except to say that in taking part in a debate within the last week or so the honourable member made some reference to the number of sons he had; obviously they must all be involved in hockey in some respect, and hopefully they are not involved in any violence as a result of that particular exercise.

Mr. M. Davidson: They’d better not be.

DREDGING CASE

Mr. Cunningham: I have a question of the Attorney General. With the dredging trial now concluded, I wonder if the Attorney General would be in a position to inform the House with regard to certain references that were made during the course of the trial -- references in Mr. McNamara’s diary with regard to a William Davis and a William Kelly?

Hon. Mr. McMurtry: I am not sure that I understand the member’s question. The dredging trial is not concluded. The accused who have been convicted, the companies, will be before the court for sentence on June 4. I have no further comment to make at this time.

Mr. Cunningham: I would like to ask the Attorney General when the House might be getting the results of the inquiry or the questioning by Mr. Justice Campbell Grant that is currently going on or has gone on?

Hon. Mr. McMurtry: I would be prepared to discuss this matter after the individuals before the courts have been sentenced.

Mr. Warner: Supplementary: Perhaps the Attorney General is aware that the Premier on July 8, 1977 made this statement: “I must say, Mr. Speaker, that I am looking forward to the opportunity of sharing the contents of Mr. Justice Campbell Grant’s report with the members opposite. On the first occasion that is available to me as Premier of this province -- because the trial is to commence this fall -- I intend to share that information with all of those honourable members who are interested.”

I happen to be interested. The trial has concluded.

Hon. Miss Stephenson: It hasn’t.

Ms. Warner: Could the Attorney General prevail upon the Premier to make the statement which he promised to make back on July 8, 1977?

Hon. Mr. McMurtry: I just repeat that the trial has not concluded.

FOREIGN OWNERSHIP

Mr. Laughren: I have a question of the Treasurer, who is trying to salvage support among his backbenchers in view of the answer to my colleague’s question.

Does the Treasurer agree with me -- and he might want to refer to his colleague, the Minister of Industry and Tourism (Mr. Grossman) on this -- that one of the major problems we face, not only in Ontario but elsewhere in this country, is the growing deficit on interest and dividend payments to non-residents, which reached a total of $5.4 billion last year? If he appreciates that problem, could he tell us where he got his mandate to go to England with his colleague, the Minister of Industry and Tourism, in a blatant attempt to peddle even more of our potential to the British and increase further the foreign ownership of the Ontario economy?

Hon. F. S. Miller: I don’t think that was entirely the reason for us going to Europe. We were there selling Ontario and the benefits of Ontario. That works two ways. We are trying to sell them on the advantage of doing business with us. I would have to say, as the Premier has said too, while we want to encourage Canadian investment in Canada and Ontario as much as we can, that does not mean discouraging other investment in Ontario.

Mr. Riddell: Let’s keep our land in Ontario.

Hon. Mr. Maeck: It isn’t going anywhere. It will always be here.

Mr. Riddell: You are going to be surprised when the report comes in.

Mr. Laughren: Supplementary: Is the Treasurer not aware that any of the benefits that might accrue to us by the increased foreign ownership of the Ontario economy would be more than offset by the level of business service payments, including research and development and fees and royalty payments to non-residents, which are in the neighbourhood of $2 billion a year now?

Did the minister make it clear to the potential British investors in Ontario that we were no longer prepared to accept the kind of carte blanche sell-out that has been so much of the history of this country?

Hon. F. S. Miller: If a company came to Ontario and simply produced products for internal consumption, part of the member’s argument would be correct, because then profits made on it would be sent to another country, but he tends to forget that many of the corporations in this export-oriented province end up creating employment here, adding value here, selling the product elsewhere, and while certainly there is a chance that profits will flow a great deal more stays here than would have stayed here had they not been in our province.

Mr. di Santo: Supplementary: Doesn’t the minister realize that if he accepts that point of view it’s pretty useless to set apart $200 million to encourage Ontario industry? Doesn’t he realize that a branch plant economy doesn’t produce any benefits other than temporary jobs for our province? And how can he reconcile his position with the intent to strengthen our manufacturing industry since Ontario has faired very badly in the 1970s and, despite last year, is the slowest growing province in Canada in the manufacturing sector?

Hon. F. S. Miller: It’s probably the only manufacturing sector province in Canada. That’s one of the big reasons. We have always been at the top of the heap, and when we talk of resource growth, obviously that’s one sector that is growing very fast.

Having just come back from Europe, there are a lot of people over there who would gladly change their standard of living for ours. Costs for food alone in that country -- Britain -- are two to two and a half times the Canadian cost. The costs for housing are two to two and a half times. We have a heck of a good life here and a good sound economy.

ELECTION CAMPAIGNS

Mr. Kennedy: A question for the House leader: Last week he indicated to the member for Oriole that he would look into the possibility of abolishing public opinion polls during elections. I am wondering if at the same time he would look into the matter of the length of time of elections and see if they could he reduced from the current 37 days -- I think it’s 45 in winter -- to 30 days from here on in?

Hon. Mr. Welch: Mr. Speaker, I am sure that the member is echoing some of the concerns that many people are expressing with respect to the length of time between the writ and election day in the federal field. Ours is much shorter of course; 37 or 44 days, depending on the time of the year. This matter isn’t presently before us, but it is my understanding that the chief election officer is giving some thought to whether or not the minimum number of days can in fact be reduced. I imagine that once he’s had the opportunity to review that with his advisers no doubt we will be getting some type of an interim report and we can give some consideration to it at that time.

HOSPITAL BED ALLOCATIONS

Hon. Mr. Timbrell: Mr. Speaker, on Friday last, the member for Wentworth (Mr. Isaacs) asked me a question and made certain allegations about the death of a lady in Stoney Creek. The ministry staff have checked with Hamilton hospitals regarding the availability of emergency beds on the night of April 26. Information supplied to the ministry indicates that emergency beds were available in all of the Hamilton hospitals that day, including Hamilton General, Henderson, Chedoke, McMaster and St. Joseph’s. There were a total of 46 emergency beds available.

I would like to inform the members that I have conveyed to the chief coroner my request that an inquest be held into the facts surrounding this death. Dr. Cotnam has advised my office that he is not yet in possession of all of the relevant reports, but that a decision on an inquest will be made by him this week.

AIR POLLUTION

Mr. Gaunt: Mr. Speaker, I have a question for the Minister of the Environment. Is the minister going to require that Anchor Cap and Closure Corporation of Canada Limited install an incinerator in order to comply with the minister’s 1978 amended control order?

Hon. Mr. Parrott: Yes, we are.

[2:45]

Mr. Gaunt: I am grateful for the response in the form it has taken. I want to know from the minister why the ministry hasn’t sampled the air around the plant since 1977; also, how one can expect to enforce a control order if one is relying entirely on the company’s information?

Hon. Mr. Parrott: As the member probably knows, we had an order on that particular plant and the original proposal was one that would require a great deal of energy to run. As the company thought that there was a better way of doing it, we believed we should give them that opportunity to explore it. We only did so on the clear understanding that if it didn’t work out there would be no hesitancy on our part in insisting they carry out the original proposal. Since that time we have found out that, indeed, their proposal is not acceptable -- I guess to themselves as well as ourselves -- and they are prepared to live with the original agreement; somewhat delayed, I agree, but they are now prepared, and I believe we have it in writing. By the end of this year the incinerator will be in place.

When we delayed it in the first place it was on the clear understanding that we would insist they go with the original concept if they couldn’t prove a better case for us. Their method has now been explored and they are going with the original concept.

[Later (3:04):]

Hon. Mr. Parrott: Mr. Speaker, in response to a question from the member for Huron-Bruce I left out a part of the answer I should have given and that I would like to add. The question was on whether we were testing; I was concentrating on the incineration of it. I did have this information available here.

The emissions are solvent emissions and they were only calculated in 1977. However, conventional air sampling is of no use in determining emissions from lithographic and lacquer ovens as they are non-particulate. Therefore we think the only way we will be able to get any reading on it is to use that extremely sensitive machine, the TAGA 3000. That we are contemplating doing.

I hope that clears up the matter of testing better than did my previous answer.

[Reverting (2:47):]

MILK PRICES

Mr. MacDonald: A question of the Minister of Agriculture and Food with reference to the comments last week of his colleague, the Minister of Consumer and Commercial Relations (Mr. Drea) on the increase in milk prices by processors.

Since the comment of the minister’s colleague was that the price increase by processors was traditionally the same as that by producers -- a statement which is totally inaccurate, as they have sometimes been taken unilaterally and sometimes, when coincident with a producer’s increase, have been higher or have been lower -- and, secondly, since the minister’s colleague indicated that the price increase was the same as that given to the producers because their costs were the same -- a point which a leading official of the Ontario Milk Marketing Board says is bunkum -- would the minister inform us as to whether or not he shared in that assessment of the situation by his colleague?

Also, what is he going to do about protecting food pricing, say, out in the market now, when this investigative reporter cum politician is barnstorming into the picture with obviously no real information as to what the facts are?

Hon. W. Newman: Mr. Speaker, I recall the question in the House the other day, or I think it was in answer to a question when the Minister of Consumer and Commercial Relations commented on the increase in the price of milk. I think the member is very familiar with the subject, but to refresh the minds of some of his colleagues who aren’t so familiar with agriculture, the fluid milk that is bought in the store is formula priced and it takes in all cost factors. I believe the increase this time, to be really technical, could have gone for three cents.

Mr. MacDonald: That isn’t my question.

Hon. W. Newman: I just want to make sure the member understands the background, so that he will fully understand the answer I am going to give. Okay? Fine. The formula called for and they accepted a two cent per quart increase.

In a free marketplace the processors themselves have a right to choose their markup, but because there is a possibility, with, in most cases, good reason -- and we will be able to give the member examples when we get into the estimates, probably by tomorrow night -- where the processing industry costs have gone up proportionately, as have the producer’s costs and they, of course, pass along whatever it may be, one, two or three cents, as far as their prices are concerned. It doesn’t necessarily follow that the increase is always the same as that of the producer. I said it doesn’t necessarily follow, but I think the processors can justify an increase if asked to. If not, there is an appeal process, as the member well knows, to the appeal tribunal. The setting of milk prices by the processors is appealable.

Mr. MacDonald: Where?

Hon. W. Newman: To the appeal tribunal. We passed legislation in this House so that could be appealed.

Mr. Turner: The member said he knew the background.

Hon. W. Newman: If he knows all the background, fine. Now he does, and I hope he understands.

Mr. MacDonald: Since the minister’s colleague stated it was traditional that the processors take an increase at the same time -- which is totally inaccurate -- and since his colleague stated that the costs of the processors are the same as the costs of the producers -- which nobody has been able to justify because there is no investigation of any kind and no mechanism for that investigation of the processors’ increases -- how can the minister get up and give this kind of rationalization; and what is he going to do about it, other than sit there in his seat?

Hon. W. Newman: In all fairness to the member opposite, I explained the process to him; if he does not understand it, I am sorry.

Mr. MacDonald: I do understand it.

Hon. W. Newman: He does not understand it, because he asked about the appeal; he does not even know there was an appeal tribunal set up. We passed that legislation in the House less than six months ago, and he does not even know we did it. Where has he been?

Mr. Riddell: A supplementary, Mr. Speaker: Apart from its investigation of discounting practices, will the food inquiry commission not also be looking into the pricing practices of processors such as milk processors? Will the commission not be shedding some light on this whole matter of pricing practices, and not just the discounting practices of some of the processors and chain stores?

Hon. W. Newman: Yes, Mr. Speaker, there is a royal commission going on now, under Judge Leitch -- a royal commission that was asked for and approved by this Legislature.

Mr. Swart: And the minister fought against it.

Hon. W. Newman: I suggested another route which would have been just as effective, but that is all right. This Legislature approved a royal commission to look into discounting practices; the terms of reference are well set out for the members opposite to look at.

Mr. MacDonald: To look into them and make recommendations for stopping them.

Hon. W. Newman: The honourable member has been making a lot of noise about it. I have said nothing about it except this: If anything comes before the royal commission that is breaking any legislation under my ministry, then we will investigate it and report back. But, as far as I am concerned, the judge and the royal commission are there to look into all these discounting practices or anything else he decides to look at. He has a very broad scope to look at.

Mr. Speaker: The Minister of Natural Resources has the answers to two questions previously asked.

FLOOD DAMAGE

Hon. Mr. Auld: Mr. Speaker, last Tuesday the member for Algoma asked me a question and a supplementary about the dams at the outlets of Endikai Lake and Mount Lake, leading down to Iron Bridge. He asked whether the ministry crews were monitoring these dams and the water levels in those lakes and whether the operation was different this year from what it had been previously.

The Endikai Lake dam is not operated. The gates of the dam are left open and water is free-flowing through the dam year- round, and this has been the case for a number of years.

As far as the Mount Lake dam is concerned, the operation of that dam was the normal operation; that is, in the fall the lake was lowered about two feet, which is our regular practice, and that practice has not produced any problems in the past.

The size of the peak flow, and particularly the speed with which it arose, was not foreseen, that was the problem this year. I am informed that in the two days preceding the breaching of the dams -- what happened is that in both cases water flowed around one end; I guess there was erosion, and water flowed around one end as well as going over. In the two days preceding the breaching of the dams there were 2.63 inches of rainfall recorded in Sudbury and 0.61 inches in Sault Ste. Marie. Those are the two nearest rainfall gauges. In fact, we had abnormal runoff conditions all the way from Lake Superior to the Ottawa Valley in that same belt More rain fell in the Sudbury gauge area in that two-day period than normally occurs in the whole month of April. Normal precipitation in the month of April is about 2.19 inches.

I am informed it is not possible at this time to determine what effect the breaching of the dams had on the downstream flows and levels, but we don’t expect that it contributed greatly to flooding downstream.

Mr. Wildman: Supplementary: I wonder if the minister in his capacity as Minister of Energy would agree with that, since Hydro seems to have indicated to the local community and to the Ministry of Natural Resources that it was the sudden onrush of flow from those dams that forced them to spill water over its dam?

Also, can the minister assure us that Kindiogami Lake dam is safe; and when can we expect a response from cabinet for the appeals for emergency assistance to the flood victims in Iron Bridge?

Hon. Mr. Auld: On the first part of that question, it is my understanding that Hydro said more water came down than it could handle, not necessarily that there was anything wrong with the operation of those dams. I wasn’t there, and I am not an expert in dam operation -- that’s d-a-m -- but more water came by than could be controlled by those dams. Consequently, I assume that for the long-term safety of the Hydro dam, the people above it and the people below it, Hydro passed more water than it would have preferred to have done.

Mr. Speaker, I have been diverted from the rest of my answer. As far as the safety of the dam is concerned, I am told that the original one, the first one I mentioned, Endikai, is an old wooden dam which the ministry fell heir to. It was built and operated by a lumber company some years ago, and I believe the ministry took it over for lack of anyone else to run it in 1964. I am told it is not in ideal condition, and that is one of the reasons it is left open and acts more or less as a weir. We are looking at what sort of structure should be there for the future. It may well be simply a weir, but funds, of course, will also have to do with how soon we get something done there.

I have now forgotten the third part of the question. In the matter of assistance, the question should be asked of the Minister of Intergovernmental Affairs (Mr. Wells), who deals with the disaster relief fund.

FLOOD REPORT

Mr. McGuigan: Mr. Speaker, my question is to the Minister of Natural Resources. Can the minister tell us when the government-appointed body that was to look into the Dover flood and the Lower Thames Valley Conservation Authority will be reporting? Can it be that this report will be delayed until after May 22, since we have already passed the target date of May 1?

Hon. Mr. Auld: Mr. Speaker, I think I indicated last week that I expected to have the report by the end of the week. I am now told that I will have it by May 10.

NUCLEAR PLANT SAFETY

Hon. Mr. Auld: Mr. Speaker, I have the answer to another question addressed to the Minister of Energy last week by the Leader of the Opposition, who was asking whether the bid for the boilers that Atomic Energy of Canada Limited purchased for export was the lowest bid. I am afraid I am unable to give that information because it would have to be asked of AECL. It was their contract, as I understand it, and not Ontario Hydro’s.

Mr. S. Smith: By way of brief supplementary, if the minister felt able to come in here and say that Hydro told him the bid was accepted from Foster Wheeler Company by a process of competitive bidding, was he merely using words for the sake of hearing them to indicate to us that more than one person bid? We already knew that more than one person bid, because Babcock and Wilcox was turned down. Or did he mean to imply that the lower bid of the two was accepted -- and there may have been more than two -- and if he didn’t know, why did he come in and say it was done by a process of competitive bidding?

Hon. Mr. Auld: Mr. Speaker, that is what I am informed the process was. What factors make up that process, I’m afraid I’m not aware. The question should be addressed to AECL, or to the federal Minister of Energy, Mines and Resources.

Mr. S. Smith: Don’t you want to know why they don’t use Babcock and Wilcox?

[3:00]

SPECIAL EDUCATION

Mr. R. F. Johnston: Mr. Speaker, my question is for the Minister of Education. Given the fact that Metro school boards, both separate and public, are unable to respond to the school needs of their inner-city population because of her ministry’s cutbacks in funding, and given the fact that reports by the social planning council, the North York principals and 53 Toronto parents’ groups point out that those needs are real, I would ask the minister now, as I did on Friday, whether or not she will reconsider extra funding for those boards?

Hon. Miss Stephenson: Mr. Speaker, under the general legislative grants, the Metropolitan Toronto area has been assured of a floor for funding. They have received an increase in the per-pupil grant, and the allotment which is available for Metropolitan Toronto has been granted to Metropolitan Toronto.

Mr. R. F. Johnston: I gather that means no. Implicit in that reply, and especially the minister’s reply on Friday, was that the Toronto board could find the money for their own programs if they showed restraint, and she listed a school that was closed.

Hon. Miss Stephenson: What I said on Friday was that I had asked the Toronto school board to examine their priorities to see whether there were some reallocations of their priorities which might be made in the light of the problems they had defined.

Mr. R. F. Johnston: If I might continue, that still seems to me to imply the same thing. That board has laid off staff over the last three years; it has been able to find no home for the Gabrielle Roy school --

Mr. Speaker: Is there a question there?

Mr. R. F. Johnston: -- there are few vacant rooms, and I just want to know whether the minister can point out some of those areas where they can find other allocations -- where they can change.

Hon. Miss Stephenson: I had suggested two potential areas on Friday in response to the honourable member’s question and they are in Hansard.

Mr. Sweeney: A supplementary: Given that the minister suggested that delaying the rebuilding or the renovation -- I have forgotten what it was -- to Frankland School might be one way that board would get money, does she not realize that capital funding and operating funding are totally separate and cannot be transferred, so that is not a legitimate way?

Hon. Miss Stephenson: I realize that within the Ministry of Education allocations that is exactly so; but I also realize that it was the intention of the Toronto school board to rebuild Frankland School and build a new school, from reserves. I was not clear about the definition of those reserves and that is why I asked the question. I have not received a response from them as yet.

ALASKA PIPELINE

Hon. Mr. Grossman: Mr. Speaker, last Monday the member for Hamilton East (Mr. Mackenzie) asked certain questions relating to the Alaska pipeline. There appear to be five simple issues involved in his question. The first was whether there are to be any changes in procurement policy for the Canadian sections of the pipeline.

In short, on the procurement policy or program of Foothills, while it is still in the process of finalization and discussions with the US government by Industry, Trade and Commerce, recent meetings have indicated no reason to anticipate there will be any changes in procurement policies.

As to the second part of his question, whether or not the contract is to be reopened, I would point out there is no formalized contract at this stage. In simple terms, Industry, Trade and Commerce reports to us that there is no pressure being applied by the United States government for a reopening of the award, being convinced of the non-competitive status of the US supplied bids. Some US suppliers indeed are complaining and are unhappy about the situation, but others in the US have indicated their acceptance of the situation. Current information indicates no intent to alter the negotiations between Foothills and Stelco towards an eventual contract with them.

Third, assurance was sought of retention of the jobs at Stelco, Ipsco, et cetera. Again, the indicated job and contract potential does not appear threatened at this time by any US action whatsoever.

On the fourth part of the question, whether or not contracts would come to Canada for the pipeline, I can only refer the members to the earlier answers I have given and point out that the award at this stage indicates that supply of services will be on generally competitive terms. That would indicate that the contracts spoken of earlier should be consummated.

Fifth, on the question directly asked, whether or not the bids were rigged, the answer is there has been absolutely no senior level suggestion that the bidding procedure was improperly influenced or carried out. Some individual US suppliers have suggested publicly that the bidding was rigged to favour Canadian suppliers, but absolutely no supporting evidence has been provided to the US administration as a basis for any complaint of which the agency is aware.

Mr. Swart: Supplementary, Mr. Speaker: Could the minister tell us if there is anything in writing or any letter of intent between the Foothills company and Stelco and Ipsco relative to the awarding of these contracts? If not, would he bring pressure to bear to get something in writing so that counter-pressure from the United States won’t thwart the awarding of these contracts to Canadian companies?

Mr. Kerrio: Nationalize it.

Hon. Mr. Grossman: Mr. Speaker, I believe my predecessors have indicated we were most anxious to see those negotiations completed. Those negotiations, as I have indicated, are moving along as they should at this stage.

Mr. Swart: But there isn’t even a letter of intent.

Hon. Mr. Grossman: Finalization of those negotiations at this stage must apparently await the finalization of the documents, which are now in draft form, with regard to the agreement between Canada and the United States on the entire project.

DISPOSAL OF HAZARDOUS WASTES

Mr. Bradley: I have a question of the Deputy Premier in the absence of the Minister of the Environment. I would like to ask him if it is true there were no representatives from the Ontario Ministry of the Environment in attendance at the beginning of the public hearings of the Inter-Agency Task Force on Hazardous Wastes, held at the convention centre in Niagara Falls, New York last week. If the ministry was not represented, would the Deputy Premier not agree that the entire question of hazardous wastes in the area of the Niagara River is of such importance that ministry officials should attend all hearings of this nature to be in a better position to protect the environmental interests of the people of Ontario?

Hon. Mr. Welch: Mr. Speaker, I would be very glad to draw the question to the attention of the Minister of the Environment. The latter part of the question is one which does invite some comment.

As the member for that area, sharing that particular part with the member for St. Catharines and the member for Niagara Falls, the member for St. Catharines will know that both the member for Niagara Falls and I have been fairly vocal in that whole issue along there with respect to representations to the appropriate government agency in Albany, hoping that they will have a public hearing on the immediate request by a particular company to increase the gallonage of its flow into the Niagara River.

The honourable member will know, from reading local media there, that there is a tremendous amount of interest in that particular issue. This coming Thursday night a public meeting is being held in the town of Niagara-on-the-Lake, with representatives from the other side of the river present. It’s my understanding that the Ministry of the Environment officials have been invited to attend that meeting as well. I’m not sure, at this moment, what the status of any response from the ministry is. I can assure the member that, along with others in that particular area, we do view, with some seriousness, this whole issue of chemical waste disposition in the Niagara River.

Mr. Bradley: A supplementary: Knowing the concern of the members who were mentioned, including the Deputy Premier, over this matter, if it were the case that the officials of the ministry were not in attendance and had to be prompted to be there by outside reports, would the Deputy Premier not agree that a better liaison between officials of New York state and the Ontario Ministry of the Environment is essential in order that we might have representation there to look after the interests of, not only the people in the Niagara Peninsula, but the people of Ontario?

Hon. Mr. Welch: I would be very surprised if there wasn’t liaison between the two authorities. I obviously can’t speak from the factual point of view with respect to the extent of that liaison but, certainly, now that the member has raised that question we’ll get a more definite reply for him from the minister.

Ms. Bryden: A supplementary: Since the Deputy Premier says he is so interested in this question of hazardous wastes, has he yet obtained a copy of the report of the New York Inter-Agency Task Force on Hazardous Wastes published in March 1979? Is he aware that it not only tries to identify what wastes are and where they are but tried to find out how they were generated and attempts to trace them to specific sites from the generator? Is he prepared to discuss with the Minister of the Environment the necessity of us following that procedure with the unknown wastes in our dumps to find out where they were generated and then trace them to specific sites?

Hon. Mr. Welch: I would be very glad to raise that matter with the minister again.

Mr. B. Newman: A supplementary: May I suggest to the minister that he consider setting up a body composed of members of the Legislature whose ridings border on the various states in the union so they could represent the government in hearings held in the various US jurisdictions so that we would always know what is going on there and could relay our concerns to them and they, likewise, could do the same to us?

Hon. Mr. Welch: I would have to get some advice on the protocol of all this. I know, through my personal attempts to persuade the American authorities in Albany with respect to the specific application of SCA Chemicals Waste Services Incorporated in Lewiston, there were all kinds of hangups as to who could be a party of interest and what the status of people would be before hearings. I didn’t want to postpone indicating my interest in that situation until all that was solved. I simply sent a Telex along saying that I understood there was a deadline by which those of us who were interested had to make some representations and, I think, before any decision was made in this matter they should allow the public to be heard on this issue and leave the protocol to a little later on. I must say, at this moment. I have not yet even had a reply -- I don’t know whether the member for Niagara Falls has had a reply yet -- that is, in my correspondence with my contact with the officials in Albany.

In all fairness, I can’t respond too definitively to the member, but would raise his concerns, along with others expressed during the course of question and answer exchange, with the Minister of the Environment in the hopes that perhaps there can be some resolution.

I think it should indicate on the record that there is a tremendous amount of interest in this issue with respect to what is going on on both sides of the waterways. It’s one thing for Ontario to be maintaining its very high standards; we hope it’s being complemented and followed up on the other side as well. This is where we have to be fairly forceful in making known our representations and our points of view.

Mr. Speaker: The time for oral question period has expired.

MILK PRICES

Mr. MacDonald: On a point of order, Mr. Speaker: In the course of his scatter-gun reply to my question on milk prices earlier this afternoon the Minister of Agriculture and Food stated that there was an appeals tribunal established in legislation some six months ago to which people could go with regard to price increases. Price increases by the Ontario Milk Marketing Board may be appealed to the appeals tribunal.

My question was with regard to price increases by processors and by retailers and nobody can appeal that. The minister is in error. I hope he will get his background filled in before we have the estimates tomorrow night.

Mr. S. Smith: As usual.

Mr. McClellan: Apologize.

Hon. W. Newman: If I am wrong I will apologize, but I don’t think I am.

[3:15]

Mr. MacDonald: The minister is wrong.

Hon. W. Newman: The member is always right, isn’t he? All I would like to say is that at least I’m prepared to look at things; the member is prepared to make all kinds of statements. I believe there is an appeal process, but we’ll deal with that tomorrow night.

Mr. Warner: Correct the record and then resign.

Mr. Swart: One question in a month, and you blew it.

Mr. Martel: You will apologize tomorrow.

Mr. Warner: And then resign.

INTRODUCTION OF BILLS

STATUTE LABOUR AMENDMENT ACT

Mr. Wildman moved first reading of Bill 78, An Act to amend the Statute Labour Act.

Motion agreed to.

Mr. Wildman: Mr. Speaker, the purpose of the bill is to provide additional authority to road commissioners under the act in order to better enable them to carry out their duties. The principal changes are the following:

1. The limitation on the amount which commissioners may fix for commutation of statute labour is removed;

2. The authority to conduct a sale of land to recover arrears payable under the Statute Labour Act is transferred from the sheriff of the district in which the road commissioners have jurisdiction to the secretary-treasurer of the road commission;

3. The road commissioners are authorized to erect and maintain enforceable traffic signs in the area under their jurisdiction.

ELECTION PUBLIC OPINION POLLS ACT

Mr. Samis moved first reading of Bill 79, An Act respecting Election Public Opinion Polls.

Motion agreed to.

Mr. Samis: Mr. Speaker, this is the same bill I introduced last year. Its purpose is to prohibit the publishing and broadcasting of political polls during an election, where the polls relate to the outcome of the election or the standing of any leader, candidate or party in that election.

[Later (4:25):]

ANSWERS TO QUESTIONS ON NOTICE PAPER

Mr. Acting Speaker: Prior to calling upon the honourable member for Armourdale, the Provincial Secretary for Resources Development (Mr. Brunelle) has asked leave of the House to file answers to certain questions. Does he have unanimous consent?

Agreed.

Hon. Mr. Brunelle: Mr. Speaker, on behalf of the government House leader I wish to table the answer to question 30 and the interim answer to question 166 standing on the Notice Paper.

[Reverting (3:18):]

ORDERS OF THE DAY

BUDGET DEBATE (CONTINUED)

Mr. Renwick: Mr. Speaker, I have just come back from canvassing in the great New Democratic Party federal ridings of Broadview-Greenwood and Beaches.

Mr. Speaker: I’m sure the honourable member will be judged by the bill that was just introduced by his colleague from Cornwall.

Mr. Renwick: I can assure you that whatever else may happen on May 22, those two ridings will remain represented by the New Democratic Party and will, therefore, provide or continue to provide a much-needed balance in the representation from Metropolitan Toronto and from Ontario and, indeed, from all of Canada because of the calibre of the candidates who are standing in those ridings.

I don’t know very much else about the federal election, and I assume we can all await the result on May 22 but, as for that portion of the great riding of Riverdale which lies within Beaches riding and Broadview-Greenwood, we can be sure that the adhesion of the electorate to the New Democratic Party is very significant, very substantial and very important in the life of this city and of the province.

I want to talk about two matters in continuing some reflections I must make about matters of concern to me; they are two matters in which I have a direct interest but no particular specific responsibilities in the caucus of the New Democratic Party.

The first one is an endeavour to draw to the attention of the Treasurer (Mr. F. S. Miller) and of the government the importance of the loss to Canada of business service payments -- many of which are paid from Ontario -- to foreign corporations which control such a significant part of our economy.

The structure and priorities of the multinational corporation often result in much research, engineering, accounting, computing and other services being done outside of Canada. This not only costs Canada the cash value of these payments, but also retards indigenous development of those skills. This problem is well known, but little has been done about it. It has been recognized by economists and others who are skilled in these areas, but no full-scale studies of the outflow of dollars for business service payments have as yet been made.

I draw the attention of the assembly to the interim report of the Ontario Legislature select committee on economic and cultural nationalism, and to the heading “Capital Markets, Foreign Ownership and Economic Development,” which pointed out that no one really knows how much is coming into the country and how much is going out by way of business service payments and called for “a systematic and continuing study [to] be undertaken to examine the levels of outpayments associated with foreign direct investment in relation to the benefits received from that investment. It is clear that service payments would form a key element in such a study.”

That study has not been done; there has been no indication of interest on the part of the Treasurer of Ontario or of the government of Ontario in the significance to the Ontario and Canadian economies of those payments which are made by way of business service arrangements.

It is crystal clear that we are talking about enormous sums of money leaving the country -- almost $1 billion yearly. It is scarcely surprising that payments to non-residents are very much higher for foreign-controlled corporations than for their Canadian-owned brethren.

The data are very old. The latest data, which I have not as yet been able to obtain for 1975 and 1976, I will have at some later time; but I do not have them today. In 1974, although the assets of Canadian- owned firms were nearly twice the size of those of foreign-owned corporations, some 77 per cent of business service payments to non-residents came from foreign-owned firms, as did 85 per cent of dividends to non- residents and 64 per cent of interest payments to non-residents.

The great bulk of the money we are talking about went in the form of royalties, management fees and professional fees. Looking at the composition of these payments, professional fees have generally accounted for 28 to 30 per cent of the total, management fees have risen from 16 per cent in 1968 to something more than 20 per cent at the present time, and royalties have risen steadily from 18 per cent in 1968 to more than 30 per cent at the present time.

In the early 1960s, business service payments were well below dividend payments and about twice the size of interest payments. By the 1970s, business service payments were approximately the same magnitude as dividends and were still about twice as large as interest payments. Since 1968, whereas assets of firms controlled outside the country increased 81 per cent, business service payments to non-residents increased 72 per cent, and dividend and interest payments rose by 99 per cent and 68 per cent respectively.

Since 1968 business service payments have accounted for about 40 per cent of the payments to non-residents by foreign-owned corporations. Any evaluation of the economic pros and cons of foreign investment must take royalties and management and professional fees as a central focus of consideration. Together they make a far larger economic impact than interest payments and are not much less important than dividends.

I am going to leave that where it lies. I haven’t got the skills and the capacity to do the kind of study required to analyse the nature and extent of the foreign business payments going from Ontario abroad or the impact upon that outflow of dollars in a cash sense, let alone the impact in the sense of the subservience of the economy of Ontario, mainly to the economy of the United States. Until we have some clear understanding of that, we cannot in Ontario, let alone in Canada, continue to allow the kind of outflow for so-called know-how to impinge so greatly upon our balance of payments picture and we cannot allow that outflow to impinge so greatly upon our capacity to develop within Ontario the kinds of skills and the kinds of capacity which are necessary for the kind of society which we all believe is necessary here in a very highly technical and competitive international market at the present time, if one accepts that particular thesis of Canadian need.

I want to turn to the question of the nuclear option and the role of the select committee. I have had the opportunity to talk with my colleague, the distinguished member for York South (Mr. MacDonald), who is the chairman of the select committee of this assembly, and with my colleagues on that committee and other interested persons in our caucus. The work which they are doing is immensely important. I am concerned, however, that this assembly has not reinforced for that committee the importance of this mandate to look at the nuclear option. One of the recommendations of the original committee, on which I served during the first minority government, recommended as part of the ongoing work that was required from this assembly a careful consideration of the nuclear option.

The nuclear option as such has become so embedded in the life of the province that it is very difficult, if not impossible, to get a handle on it at the present time. We had hoped back in 1976, when that report was first made, that somehow or other the assembly through one of its committees would be able to take a very cold look at whether or not the nuclear option was the only option that was available to Ontario for the purposes of security of its energy supplies and for the growing development of the Canadian economy within the Ontario society.

Unfortunately, events did not permit that committee to take on that particular role until the impetus that has been created by the disaster at Three Mile Island in the United States.

[3:30]

I want to speak a little bit about what our assembly here should do for the select committee. I think the assembly must reaffirm the immediate importance of the ongoing assessment of the nuclear plants in Ontario. The only benefit to us from the Three Mile Island consequences is if they will reinforce for us our urgent sense of the importance of developing, studying and analysing the nuclear installations in this province.

In any event, I want to dissociate myself from any version that what we must engage in is to await the report about Three Mile Island, where there is a different kind of nuclear fission operation from that which takes place in Ontario, so we can then have that logical panacea which we are given almost every day that the nuclear system in Ontario, of course, is different, with the uninformed conclusion that, therefore, it is safer.

I think it is absolutely essential that this assembly let it be known to the select committee that the priority of that committee must have an overriding place in the work of the assembly. I say this for two or three reasons. I am very grateful to the unnamed or unknown person in the Ontario Hydro establishment who provided the information to our colleague in the Liberal Party, the member for Grey-Bruce (Mr. Sargent). I am grateful for this reason: As a lawyer -- and I see my friend, the Attorney General (Mr. McMurtry), is here -- as any lawyer would know and understand, when one’s launching on an investigation of such magnitude, the very first thing one looks at are the original notes of problems within the installation; not the quarterly reports, not some interpretative analysis of the events as they are assessed and re-evaluated later on down the line, but the very raw material of the evidence on which one can make a thorough and objective investigation of the extent and degree of the problems -- in this case, within our nuclear establishment in Ontario.

I want to say that it may well be that over time Hydro would have produced those documents, or the series of documents of which those were a part. It may well be. I have very real reservations in my own mind as to whether or not, without the actual disclosure by a member of the staff of Ontario Hydro of certain of those documents, the importance of that raw material evidence would be available and readily appreciated throughout the province and to that select committee of the assembly.

I think it is absolutely essential that this select committee accept full responsibility, both for the security of that information, for the purpose of its study and analysis by the committee, and, in due course, for its availability to the public as it becomes available to the committee in the course of the ongoing work of its study, in an objective sense of the safety of the nuclear system. If any of those documents are to be denied to the public, then it is my view that the select committee must take the responsibility for that decision and give the reasons why any particular documents are not made publicly available.

There may well be a case for those procedures within those installations, related to the security of those plants, where that will be required. But I think it is important for us to understand it must be the responsibility of the committee to make the decisions with respect to whether the various documents underlying the whole of the public information about the safety of the nuclear system is made public for comprehension and study and understanding of the kind of options.

The reason I think this is extremely important is that the province is at the point where it is going to have to make a decision: is the nuclear energy program the transitional way to energy produced by renewable resources -- solar energy or other kinds of energy produced by renewable resources? The government must decide whether the nuclear option is the transition stage, or whether it is possible to have a moratorium now. And it must decide whether the work of the select committee is headed towards -- speaking of the nuclear option -- a moratorium on the development of further nuclear installations here, until that select committee makes its report. The committee must be directed not only to the question of the safety of the nuclear establishment within the province at the present time, but whether it is necessary to go to the transition through nuclear power to safer forms of energy sources for this province.

At its convention about two years ago our party opted in favour of an immediate moratorium. This would allow that kind of study to take place to determine whether we are irrevocably involved in pursuing the nuclear option or whether we can say it did appear to be necessary but it is no longer necessary in order to provide security of energy supplies for Ontario in a developing society.

I think it is interesting to recognize that a mere 25 years ago there was little if any knowledge of the technology of nuclear fission for the generation of electric power. Very little of that actual applied technology was available. Now it appears to be in an almost runaway stage, not only in Ontario but in areas where energy is in short supply or in countries which do not have any indigenous energy resources apart altogether from the nuclear option.

A concentrated, determined effort was made here when Ontario Hydro decided in the 1960s to pursue the nuclear option, under the emphasis of the then leader of the Conservative Party, the Honourable John Robarts. Whether or not it would be fruitful if that kind of direction were given today to Ontario Hydro to require them to explore with a sense of urgency and importance the technology of energy productivity and energy generation from the renewable sources is worth considering. It might be beyond the comprehension of most of us in the assembly as to what the technology would be. However, that does not make it any different from the kind of technological information which was available 25 years ago and on which the present nuclear plants in Ontario are based.

I do not know the mechanics or the procedure by which the re-emphasis by this assembly should be made to the select committee. But barring everything else, the committee should be told not to move in a leisurely way into the study of this topic along with a number of other topics, but that it move with all deliberate speed to recognize the urgency and the importance of the study which they are doing, the responsibility which they must assume, the responsibility which ultimately this assembly must assume and the responsibility which ultimately the government of Ontario must assume, before they lock us in irrevocably on the nuclear path.

Whenever we talk of energy, we have immense vested interests already involved in the field. Therefore, it takes the kind of detached, objective, independent view, which in my judgement is only possible for a committee of this assembly, to bring to the people of Ontario a sense of what the alternatives are, what the possibilities are, what leadership can provide and whether or not by the turn of the century we might very well be in the position where we could look back and say, “Thank God we halted the nuclear option at the time at which we did halt it. Thank God we have moved to renewable resources and resources which do not have inherent in them the immense destructive capacity on which the nuclear option is based.”

I want to turn just for a little while now to three areas which fall roughly within the responsibilities which I have been asked to assume in our caucus. I have been concerned for some time about the adequacy -- I am not talking about the competence of the people involved -- of the procedures by which something called catastrophes are dealt with in Ontario, regardless of the nature of the event and regardless of the cost or whether they fall within that strange world of the acts of God, such as the tragedy of Field in the last while, or whether they are man-made in the sense of significant spills of noxious materials of one kind or another -- noxious to human beings and noxious to the environment in which we live.

I have had some correspondence about it with the Minister of Intergovernmental Affairs (Mr. Wells) and with other ministers involved. I understand that the first point of connection for practical purposes for the great bulk of the province is the Ontario Provincial Police. But nowhere do I see it clearly earmarked as to what the course of events is; what participation by the public is required in many cases; and the motivation to get that participation activated in circumstances of an emergency, wherein most of these incidents of which I speak could fall.

Because we are relatively free of climatic hazards and relatively free so far of significant spills of one kind or another in the chemical or energy field, I have the funny feeling that we in Ontario seem to be always in the position where we categorize whatever happens as a disaster. We seem to let the disaster take its course and then have a discussion as to whether or not we will make dollars available to the particular locality which has been damaged by the disaster in order to repair the damage.

I say to the assembly that that seems to me on balance, to be a very passive approach to the problems we can be faced with in Ontario. I think it is important -- and I hope we will be able to pursue this matter in the estimates of the Solicitor General in due course -- that we understand as members of the assembly exactly what takes place when the report goes to the OPP, which is the nexus of connection between the public and the system which is supposed to go into operation, then to understand how the system is motivated by that particular connection, and then to decide how we can in some way make certain, to the extent we have the capacity to do so, members of the public are alerted to what they may be required to do, depending upon the extent and nature of the event that triggers the whole operation.

[3:45]

I haven’t been to Field and I don’t know the topography but I felt a deep emotional feeling towards the people who suffered that particular catastrophe, as I know many people did. I had the funny sense that we in Ontario were responding in a much less positive way than the people in Manitoba, who have had a history of this particular kind of event. We seem really to be in a very passive role in relation to the flooding that did take place. All our action seems to be after the event. It is my concern and my wish that in some way we could make certain the alarm network and how it operates, and the way in which the public is to participate, should be looked at very carefully and very clearly.

I recognize that with the limited number of members and the numbers of committees we have we can’t solve everything by delegating it to a committee, but I would think it might be immensely helpful to the province if a committee of this assembly -- there’s no need to have a large committee -- were given the responsibility of looking at the emergency procedures in this province and what the events are that are likely to occur or may possibly occur, and of publicly interviewing and calling witnesses to determine the ways in which we should respond to make certain that we have an adequate plan and an active plan.

I have this sense of passivity in the way in which we in Ontario are prepared to deal with events that may occur which are a danger to human beings, disastrous to some communities and potentially hazardous on a permanent basis to the environment in which we live.

I want to reflect on another item for a moment because I have a responsibility in our caucus with respect to this strange jargon word “multiculturalism.” I’m not at home with such language. I have an instinctive dislike of words such as “multiculturalism” and “anglophone” and “francophone” and other such linguistic monstrosities in which we tend to hide matters of importance when we really don’t want to communicate directly with each other as to what they may mean.

Right from the very beginning of the concept of the country, and Ontario in particular, becoming something called a multicultural society, I had immense difficulty with what the government kept saying was its policy in the field of multiculturalism. I want to try for a moment to express my difficulty, and I refer of course to the recapitulation in a report on multiculturalism, a summary of recent developments which came out I believe this year. In any event, it’s quite recent and it quotes the policy of this government as enunciated by the Premier some time ago:

“The Ontario government’s multicultural policy enunciated by Premier Davis in May 1977 seeks to ensure (1) the equality of all members of society whatever their heritage in terms of enjoyment of rights and fulfilment of obligations, (2) the freedom of access to public services and facilities for participation in recreation and social intercourse, (3) the right of individuals and groups to maintain and develop their ethno-cultural heritage, including language. These aims constitute the credo adopted by the multicultural development branch of the Ministry of Culture and Recreation.”

The reason I have difficulty with that as a policy is that I say we could do nothing less. It would appear to me to be the elementary foundation of a civilized democratic society to say that those are the goals, be they known by the short terms of equality, participation and appreciation. I cannot conceive that a society such as the society in Ontario could have any other goals for the people who are among its citizenry, regardless of where they may come from.

I had some difficulty in understanding the problem I was faced with, and I can hardly dignify that as a policy. I could understand it as a statement of fundamental principles of necessity inherent in a civilized democratic society, but not as a statement of government policy. Which leads me to the next progression I have been trying to make, in the hope that I might at some point understand what multiculturalism is about.

I could not help but come to the very fundamental conclusion -- and I suppose this is a truism or trite saying -- that you cannot extract language from culture and have something left. I am not saying that culture is synonymous with language, but I have difficulty in conceiving of a culture divorced from the language, because it is such an important part of the whole world of culture.

For example, I think language is the only means by which we can interpret anyone else’s mind and the only way in which we can relive any other person’s experience. Certainly, in relation to cultural groups, language is not only an essential ingredient in the maintenance of the particular cultural environment of peoples, but also the method by which and through which we talk with each other and we hear what the other person has to say.

When I focus upon language I therefore must come to a significant conclusion about a riding such as my own: We must do everything, I believe, through the educational system, with government support -- not through the spontaneous efforts of individuals but with direct government support, as a matter of government policy -- to be certain that we maintain the many languages of the peoples who formed the society in Ontario.

I say this for two or three reasons. First of all, I do not happen to be one of the persons who gets uptight if persons from countries other than English-speaking countries are taught in their own language, in the elementary and other parts of the school system, a range of subjects. There must be many children for whom the only way in which they can participate in our educational system, at least on a transitional basis, is through the facility of their own language in our own school system.

I am surprised at the number of people who get really concerned that somehow or other the Ontario society is being hurt severely if Greek-speaking children are educated in the Greek language or have their range of instruction in the Greek language in the elementary schools -- or any other language. I have never been able to understand that.

I have not in any sense come to any definite conclusion about what the specific policy should be, other than that I think it is the role of government, specifically and of necessity, to take hold of that question of languages. Be it the Chinese language or one of the Chinese languages, be it the Italian language, the Greek language, the language of the Pakistani community, the language of the Sikh community, Punjabi, or any of those languages, we must see in a positive way that they are preserved for those members of the society who come from those countries.

We stand in grave danger of losing the capacity to maintain those languages in one, two or three generations. I’m certain that my colleagues know very well that in one generation, with the impact of the English language as the language in which one lives and moves in our society, it is very easy for the first and the second generation to lose their capacity to speak in the language of their parents or of their grandparents.

I think that’s tragic in a country such as this and I think we have a profound responsibility, if we are committed to multiculturalism and to maintaining a multicultural society, to ensure that that language component of culture is positively supported through the educational system.

I am indebted to Mr. Ray Wolfe in another aspect of my concerns for what this sense of multiculturalism means in Canada today. I think all of us probably received the copy of the remarks which Mr. Ray Wolfe made when he was given an honorary degree by one of the universities in Israel. When he was speaking in acceptance of the honour conferred upon him, he spoke in almost universal terms about the problem of all of us in coming to a new country, whether we came three, four, five or six generations ago or whether we came as recent immigrants.

It seems to me to speak to everybody in Ontario, if they would think about it. It seems to speak to what I believe to express the essential nature of a multicultural society and what it means in a democracy such as ours. Being indebted to Mr. Wolfe, I’m going to quote, with very few changes, comments which he made at that time.

“I should like to contribute this simple account of how one person deals with the dichotomy of loyalties which arises between the country to which he belongs and that other country which he feels belongs to him.

“My father came to Canada from a land where, as in so many parts of the world, existence was marked by persecution, bitterness and poverty. In Canada my father found a haven which proclaimed itself a democracy, and it was this attribute which I was raised to cherish above all others.

“As the years passed, it was in the light of that word, ‘democracy’ that I discovered the freedom to define myself both as a Canadian and a Jew. When, as sometimes happens, I am challenged to state the order of my loyalties and to justify the privilege of linking them with a hyphen, I say that what distinguishes democracy is the right it confers on people, the priceless right, to be different, to hold opinions not identical to those of their neighbour and to believe without the compulsion to conform.

“One who calls himself a Canadian-Jew is not hyphenating his allegiance but defining himself, proclaiming his own freedom. It was in pursuit of this freedom that my father crossed a continent and an ocean and came to a strange new country, so that I might have a future without having to forget my past, so that I might be myself instead of pretending to be other than I am.

[4:00]

“Is it not, after all, on the ability of society to accommodate and accept our differences that democracy is founded? It is not the function of democracy to obliterate historical or cultural plurality. It is the goal of democracy to allow each to contribute to the common society.

“In short, no Canadian principle requires me to develop an historical amnesia; no Canadian ethic compels me to become alien to myself, to commit spiritual suicide, to cut myself off from those who gave me the innermost sense of my own being.”

I end the quotation, and it needs no comment from me because of its universal application, other than to say that if one substitutes for a particular person, instead of the word “Jew,” the word “Irish,” the word “French,” the word “Sikh,” the word “Greek,” the word “Italian,” whatever one wants to use as the particular hyphenated conjunction with the word “Canadian” to designate the place from where either the person or his family originally came to this country, then it seems to me, in Mr. Wolfe’s words, that we have a universal statement of what I think a multicultural society is and must be.

The very study of those words poses an immense challenge to this assembly to make certain that we take the kinds of affirmative actions which are required in order to make certain that the multicultural nature of the society is something other than a mere form of words and something other than, from time to time, the kinds of ethnic celebrations which we all enjoy and delight in but which do not really speak to the way in which we must develop the kind of multicultural society which I believe is our obligation and in which we in this party -- indeed in every party, I’m sure, on reflection -- are dedicated.

I think we have a long way to go in affirmative action in various areas of government, in order to realize with great difficulty, in what was almost a unicultural society at one time, perhaps a bicultural society at another time -- and certainly at this time, as anyone in Canada knows -- a multicultural society.

I want to turn very briefly to the question of Confederation. I do so because I had placed on the Order Paper, about the same time as my colleague the member for York West (Mr. Leluk) had placed a motion on the Order Paper, a motion dealing with Confederation.

It had been our intention that had the government introduced and placed on the Order Paper its resolution foreshadowed in the throne speech -- and it may well be, at some point, that will happen -- our resolution will appear as a government motion. But one doesn’t know what the course of events will be in this assembly in the field related to matters touching on Confederation.

There is a very evident intention, conscious or otherwise, of the government to exclude the members of the assembly from any participation in the process of constitutional rejuvenation which is going on in the country.

The resolution I put on the Order Paper -- and I’m not going to read it; it’s available on the Order Paper -- was simply to ask that there be established a committee of this assembly to be conversant with and to have an ongoing participation in the development of the constitutional thinking which must, of necessity, be gone through if we are to reach our goal of a united Canada, to which we all pay our particular tribute and homage.

When the time came as to whether or not I would debate that resolution as my contribution to private members’ public business, I had discussions with the House leader of the government and with the Minister of Intergovernmental Affairs (Mr. Wells), because I had raised with them what the intentions of the government were with respect to its resolution. I am not casting any aspersions on the ministers involved -- I have some knowledge of how these processes work -- but I had the expression of the intention of the government that it would be coming forward in a very few days. That was back on April 1. We have not as yet -- unless it is on the Order Paper today -- seen the government resolution.

I know there was to be a debate last week on the government resolution, but for reasons which are probably locked in the minds and souls of the House leaders of the three parties the decision was made that the debate would not take place at this time but at some later date.

I want to speak now about the proposal to have a committee of the assembly, in the hope and anticipation that the government will adopt the suggestion and in its resolution will embody a provision to provide for the appointment of a committee of this assembly, substantially with the terms of reference that were set out within my resolution and with somewhat similar responsibility, and will provide that the committee be required to recommend to this House the policy and proposals for Ontario which will best ensure the continuing unity of Canada, the said committee to report not later than November 1, 1979.

The reason it seems to me to be important is because I can’t understand what is taking place in the Confederation debate in the country. I haven’t understood it for some considerable time and I certainly don’t understand it at the present time.

It does not relate to the questions of the revising and the redrafting of the constitution and the changes which will be necessary in it. All of those are interesting alternatives. There have been many proposals put forward about the fundamental structures of the country, there have been many proposals put forward about matters of primary importance to the country, and there have been many proposals put forward relating to many of the secondary matters which must be dealt with in a constitution which down the road it will be very important that we think about.

The funny thing is, when party leaders in this assembly and in the national debate that is going on say we all want less unemployment, we all share that goal of less unemployment. We all want more economic growth, and we all share that goal of economic growth. We all want stable prices, and we share that goal of stability in prices, the curtailment of inflation, however you want to express it. In energy matters they all say we share the goal of security of energy resources, of energy sources for Canada, a security of supply. They all agree with that.

Then they all proceed to put before the people of Canada the alternatives by which they think they can achieve those goals. There is a wide range of goals which are common to the leaders of all three parties, common to all three parties, federally and provincially, that don’t inhibit in any way very significant differences of opinion as to how you achieve the goal.

In most cases, the debate in political terms is about those very alternatives of achieving those goals, but the funny thing which happened in the 1977 provincial election and which seems to me to be happening, and I am only an observer of the political scene federally, is that in 1977 the three leaders of this assembly said -- this is not by way of any reflection on what happened at the time, but trying simply to understand it -- and again now are saying we all share the same goal, we all want a united Canada. But for reasons which I don’t understand, as distinct from all other shared goals, they won’t talk, any more than the leaders of our parties here in the assembly did in the 1977 election, about what we would do to maintain a united Canada.

The sole contribution and the inflexibility of the position has been stated in what we will not do -- that is, we will not negotiate sovereignty association. But that’s a very negative contribution to the debate. I say about my party as much as I do about either the Liberal Party or the Conservative Party and I say it both provincially and federally -- it’s about time we started to talk about what positive steps we intend to take, between now and at the time the referendum is taken in Quebec, in order to achieve the goal of a united Canada. It’s time we did this so there will be an open debate about it. I would hope that out of that debate and discussion we can find some specific steps which will be taken.

It seems to me we run grave danger of being mesmerized into immobility, which is unacceptable to me in a political sense -- that we must await the referendum in Quebec before anything else happens. We are supposedly to go down to the wire, conveying to the people in Quebec that we are not going to take positive steps to keep Canada united. We are to say to them: “We won’t negotiate sovereignty association now. You go and have your referendum in the knowledge that’s our position.” It is very immobilizing, very mesmerizing, and it has hypnotized the political debate in a way which seems to me to be quite unacceptable.

I don’t know any more than anyone else what the course of events is going to be. I don’t happen to believe there’s going to be some specific climactic moment that’s going to take place and we are going to say the country’s falling apart or hasn’t fallen apart. I don’t think that’s the way the political process operates in matters of this deep import.

So far as one can judge in reading and following and trying to understand and interpret what is taking place with the many voices contributing to it, and the many diverse ways in which it is expressed, it does seem to be very clear it has already been determined that there’s not going to be a question of, “Do you wish to be separated from Canada or not?” That’s not going to be the question. It’s not going to be a question which can be answered in those terms. Indeed, I think the Premier of Quebec appears to have said very clearly, to me in any event, there’s not going to be any unilateral declaration of sovereignty or independence. If there is, it’s somewhere down the road. What he is saying presumably -- and I can be completely wrong on the matter -- is that the question on the referendum is going to be phrased something like, “Do we have a mandate to negotiate something called sovereignty-association?” That appears to be the question which is going to be placed on the paper and it seems to me that’s the kind of question a person in Quebec is going to have difficulty voting against.

So if it turns out that somewhere within that range of possibilities I have selected one which is, by and large, the way the question is going to be put, surely we are not in a position where we are now saying that in the light of that kind of mandate there aren’t going to be negotiations, that we refuse to sit down and talk, that is the other kind of rigidity which has crept into the whole of the discussion.

[4:15]

But I want to come back and reinforce the suggestion I put forward -- and it is implicit in the resolution which I had before the assembly; to say to the assembly and to say to the government please include a provision with respect to a committee of this assembly so that all of us committed to a united Canada can assess what we will do from now until the day the referendum is taken, which everyone assumes is going to be a new chapter in the book -- not a divorce within the Canadian Confederation but a new chapter in the book -- and then we can deal with that.

If we are all agreed that we want a united Canada, then it seems to me there are some very specific things that can be done from now until that referendum is called in order to communicate within the country, and with the people of the province of Quebec specifically, why we want a united Canada and why we think it is important in historical, traditional, present-day or future terms -- whatever terms anyone wants to use and for whatever reasons anybody wants to advance.

It does seem to me that to have this sterile immobilization of that debate, which appears to me to have taken place, is a disservice to the importance of the debate and a circumstance in which I, as a member of the assembly, do not want to find myself having sat through an important period of the life of Confederation and to find that we, as members of this assembly, have not participated in it.

The other aspect is that they argue: “Is it important? Is it a major issue or not a major issue?” That seems to me to be a ridiculous way of talking about the topic. One can make whatever rationalizations one wants about it, but it is an issue, a very vital, important issue. Whether it is the major issue, whether it ranks on top of everybody’s concerns, it seems to me that we have that responsibility.

So far as individual members of the assembly are concerned -- and whether I speak about the backbenchers of the Conservative Party, about the members of the Liberal Party, or about the members of this party -- we have no sense of participation at all in what is going on; until we do, I for one am going to continue to call for a committee of the assembly to be a participant.

One need only look at the debates at the time of Confederation to realize that members of the Parliament of Canada went down almost en masse and toured around Nova Scotia, New Brunswick, Prince Edward Island and Newfoundland at the time of the original Confederation. They went from city to city, sharing views and discussing the possibilities and prospects. True, that was perhaps a somewhat more optimistic time for many people to join together in the Confederation. But surely if it could be done in a more optimistic time there is an impelling obligation on us to do it in a more difficult and awkward time in the life of our country.

I do not happen to be a rabid nationalist; I happen to think that the country of Canada -- and I prefer to call it a country rather than a nation or some other esoteric term of political science -- the country really cannot very well exist against the immense pressure from the United States unless we have the participation of the French-Canadian peoples, as well as the peoples elsewhere in Canada, in making certain that it does exist.

Those are my positions and the reasons why I feel very deeply about the responsibility of this assembly, and the only vehicle I know is by the appointment of a select committee.

Another aspect of my reflections upon the nature of the legislative and government process in which we are engaged here, is that I think part of the solution is for us to commit ourselves to a much more rigorous form of democracy than we have been used to. I touched upon this in my opening comments on Friday last when I talked about the role of the member of the assembly in relation to his own riding and the method by which he senses what his constituents wish of him, as a member, on all of the range of issues and topics which come before him from time to time. I am inclined to think -- and I have difficulty in overcoming this kind of obstacle because I tend to be a pretty rigid parliamentarian in the sense of the representative nature of the democracy; but I have tried to read a little about the referendum operation as it was worked out in the United Kingdom and the referendum law that was then passed in Quebec. Certainly, the experience in the United Kingdom was a good part of the basis on which the province of Quebec evolved their own referendum statute; not related to the one issue but a general referendum law. And now we have one in the Parliament of Canada with all of the tremors that the rigid parliamentarians like myself sense about the referendum method of democracy.

It does seem to me that we might very well give consideration, and perhaps an appropriate place would be in the procedural affairs committee, as to whether or not the time has come when a referendum law of general application could be one of the instruments available for assessing and getting some sense of what the people in the province wish on matters of significance and importance as they come through the assembly. I do not know about that, but I think we would be foolish to take a view that we are so wedded to and pure in our parliamentary representative system that we cannot envisage the possibility of a referendum law.

My last plea, Mr. Speaker, before I stop my particular contribution to this debate, in which I have welded both my contribution to throne debate as well as to the budget, having unfortunately missed the throne debate, is to say that we must be vigilant about making certain we look very clearly at a rigorous type of democracy for Ontario, much more rigorous than we have practised for a long time. I think we are almost at the point where the individual members in a little while may have the resources to permit them to do what impinges so heavily on the individual members, that is the individual case work within their constituencies. This is particularly so in the urban constituencies; perhaps also in the rural constituencies but I am not familiar with that part of it. We, as members, should see whether or not we can now direct ourselves towards the other aspect of our responsibilities, which is the nature of the democracy within our constituencies and the way in which we in this assembly, through the use of the referendum or other techniques which may be available in a more rigorous democratic society, could get less of a sense of isolation from the world around us, which isolation inhibits all of us in the expression of our concerns.

It is with those remarks, somewhat within the framework that I opened my remarks last Friday, that I now close them.

Mr. McCaffrey: As is the custom in the budget debate, I want to say some things about my own constituency and there are one or two comments I would like to make about the budget. If I may begin with an observation or two following some comments made in a broad area of procedural affairs last Friday by the member for Riverdale, who just concluded his comments.

If memory serves me correctly, the member for Riverdale was commenting on how the office of the clerk had responded to this explosion in committee work around this place effectively. It was in the form of a compliment to their diligence. I want to briefly and publicly thank Mr. Doug Arnott, who is the clerk to the standing general government committee, that infamous committee that has been now for a little bit more than one year looking at the question of continuing rent review legislation in Ontario. I guess it has been four or five months since Mr. Arnott’s work as a clerk to this committee has been under way.

He has been extremely helpful and useful to us, not only in compiling the number of briefs, of which there have been many dozens over those months, making them available to us in an orderly way, but on a regular basis he has been working, sometimes under difficult circumstances, to arrange for witnesses to come in and to make their oral presentations to the committee. This is difficult because of the clause-by-clause work we are doing, and he is forced to make a reasonable guess as to where we might be one week away from the phone call by the witness. I think he has done some excellent work with us.

That committee has been a tremendous experience, a heavy experience in a lot of ways, for those of us who have been involved in this topic for some time. Just by way of a public compliment to the member for Riverdale, there will probably be another time to do this, but he has been not just a regular participant at the committee, but his contribution, I think, has been extremely important. In due course tenants, if not landlords, will want to be reminded of the work he has done.

In the broad area of procedural affairs, if it is appropriate I would like to make just one or two comments. They come by way of frustration with the system here, and I hope they are taken in that context. As recently as this morning I did make arrangements through the clerk of the procedural affairs committee to attend the next meeting, which I believe is Thursday morning, and in a more formal way express some of my concerns about the handling of timetables, et cetera in this place.

I think the whole matter of the budget speeches which we are now involved in is one indication of how I as a relatively new member here find that we often don’t use time as effectively as one would hope. The budget speeches have some longstanding relevance historically and traditionally. Every private member has the right and the responsibility, if he takes it, to respond in the budget debate. But quite often, I think, it is not just unique to our caucus, we find we are rushing around at the last moment to get people to respond in the budget debate. I think that is often true in the speech from the throne debate as well.

Mr. Nixon: You could always use your old television scripts.

Mr. McCaffrey: It’s even worse than that; I could use last year’s response to the budget.

Mr. Nixon: There was a great program on Saturday night.

Mr. McCaffrey: Yes, that wasn’t bad. It lost a little in spontaneity. What it lost in spontaneity it made up for in appearance.

[4:30]

I could use last year’s speech, and as I was about to say, Mr. Speaker, other than my mother, who is a regular reader of Hansard, I don’t think anyone else would notice. I think that is one of the things that bother me a little about the use of time in this place. We go through the motions of making sure that there is a quorum in here, whatever the number is, 20 people in any given day or night, and we seem to be a little short of that at the moment.

But we have, from my point of view, a regular series of problems every Tuesday and Thursday night when the Legislature sits from eight until 10:30, often sitting paralleling committee work, and when people are advised to be in the building in anticipation of a vote. I guess it’s true in all caucuses that Tuesday night is the command performance night, being legislation night. The likelihood of a vote taking place at 10:15 on Tuesday has been pointed out to us regularly by our whip, and I’m sure that’s true in the other caucuses as well.

Mr. Nixon: We’re here all the time.

Mr. McCaffrey: There are those of us who are here often as well, and there are undoubtedly some who are here all the time. It does, however, beg the basic question of whether it is the best use of time to be available as it were in this building from eight o’clock on on those two nights during the course of a normal week.

I, quite frankly, take no comfort in the fact that when I mention this to people who have been seasoned veterans in this place they say it’s nothing like it used to be, and I’ve been regaled with stories about how often votes would occur, if at all, at three o’clock in the morning and so forth. When I was a regular taxpaying citizen outside this building I didn’t realize that that silliness went on, and at that stage of the game I think it would have been as difficult to accept the wisdom of that at that time as I find it difficult to accept the wisdom of these standing Tuesday and Thursday night appointments where people could be using their time more effectively. I’m not talking just as a Metro member about somebody who might be back in his own constituency meeting with voters, although it’s very clear that that’s a --

Mr. Nixon: Or watching television.

Mr. McCaffrey: Or watching hockey games or whatever, each of the members can wrestle with his own conscience on those kinds of things, but just to be on call for 10 or 12 hours a week for the possibility of a vote is something that I think leaves a lot to be desired.

Mr. Nixon: You’re supposed to be in here listening to the debate so that you’ll know what you’re voting on, or possibly even being persuaded.

Mr. McCaffrey: I can usually get caught up pretty quickly on what it is we’re about to vote on.

Mr. Ashe: You can miss an hour or two and not miss anything in most speeches anyway.

Hon. Miss Stephenson: You could have missed all last Tuesday night and not missed anything.

Mr. Samis: Come on, Bruce, let’s hear from you.

Mr. McCaffrey: Right, thank you George, I appreciate your interest in this. Maybe also as a relatively new member and not part of the establishment around here, I find there are people who -- I think of them as part of the establishment, on both sides of this Legislature, just because they have been here for a long time -- accept a lot of these things a lot more quickly than perhaps newer participants in it.

In summary, on this whole question of the use of time in this place and in committees and in the Legislative Assembly, I’m convinced that things could be done better and that there is a better way. If the opportunity is there on Thursday morning for me to speak in some detail at the procedural affairs committee I hope to do that, and perhaps subsequently to talk to my own House leader about it. I would hope that other private members would speak to their respective House leaders about it as well.

I said I wanted to make one or two comments on the budget, and I’d like to specifically speak now about the health premium. I think it was an important part of our recent budget where it was announced that premiums would be maintained, because it was not necessarily clear 12 or 14 months ago that that would be the case, and that premiums were increased this year 5.3 per cent to reflect the obvious increases in health care in Ontario.

In the earlier budget of March, 1978, we were faced with an unacceptably high increase in the rate of premiums. Following that it was decided that a select committee would be established to look into other alternatives of financing the health care system. That committee, of which I was a member, met for four months in the summer and early fall of 1978. That committee heard briefs from medical people, economists and others.

Our primary task was to find, if we could, another alternative to health premiums as a way of raising money.

We looked at the alternatives, some of which are outlined in the recent budget paper: lottery profits, sales tax increases, increases in corporate income tax rates, payroll taxes, and personal income tax rates.

I do not think it is appropriate to go into the reasons -- I think they are fairly obvious -- why we rejected increases in sales tax, corporate income tax, payroll taxes, et cetera, to cover that roughly $1 billion that is raised by premiums. But I do want to make one or two comments on the matter of personal income tax rates.

Reading from the budget paper: “The remaining financing alternative for OHIP is the personal income tax. This was the option to which the select committee devoted a great deal of its attention. In fact, both the Liberal and New Democratic members of the committee opted for refinancing via personal income tax, although with some differences as to how it would be implemented.

“The personal income tax option is appealing for a number of reasons. Even with indexing, the revenue growth of this tax substantially exceeds premium revenue growth. The necessary tax increase could be collected with virtually no increase in administrative costs and the existing premium administration system could be scrapped, thus saving government overhead and relieving employers from administering the current system. The tax is progressive, and thus the entire system of health care would be financed primarily on the basis of ability to pay.

“On the other hand, some strong counter arguments can be advanced. With premiums currently raising some $1 billion, the required adjustment in the personal income tax would be 13.5 points. This 30 per cent rate increase in Ontario income tax would create a significant disturbance in the tax system which could reverberate throughout the economy, even if it is phased in over a period of time.

With the province poised for a significant take-off in job-creating investment, many would question the wisdom of eroding individual initiative and incentive, which could certainly result from such a large tax hike.”

I would like to make a comment or two on this matter of eroding individual initiative and incentive. I would like to say that not simply in the context of what that would mean if the money currently raised by a premium were raised via personal income tax routes but also in a more general sense because of the number of times members of the opposition see the personal income tax vehicle -- that progressive tax vehicle -- as a way to fund all kinds of other social programs.

I think that is worth emphasizing, because it is not just in the area of health that we hear from opposition members that we should go to the progressive tax rate to fund programs. There is in this province from the opposition members and in the country, from NDP members in Ottawa in particular, a frightening level of ignorance about the advisability of using progressive income tax rates to fund all these social programs.

To put my concerns in context, I would like to state that in my judgement we are at the margin now as to how much more we can rely on this revenue source without deteriorating incentive in this country.

There is a young economist in the United States named Arthur Laffer, I think, who has done some work on this matter of income tax and how it impacts upon initiative and incentive. I would not recommend that the opposition members take too much time in reading some of his work because it is relatively simple.

His basic thesis is that, as the tax rate is increased by government, the tax base goes down: so you do not in fact increase your revenues. Laffer has spoken in this province on one of two occasions. He uses some anecdotes to make his point, and I would like to try to paraphrase a couple of them.

Using the Robin Hood theory to explain how progressive tax can militate against the government’s attempt to increase revenues, Laffer has a more modern Robin Hood who goes through this hypothetical forest and doesn’t just rob holus-bolus those who are wandering through, but takes from them on the basis of their ability to pay. Very simply, if Robin Hood stops a rich individual wandering through the forest he would take a very high percentage of that person’s income. A middle income earner would pay proportionately less to Robin Hood, and a poor individual caught wandering through the forest would likely not have to give up anything to Robin Hood.

It is the rich, though, that are singled out by him as they take the shortcut through the forest and he increasingly takes the lion’s share of their worth.

Laffer asks: “After a series of such robberies how long do you think it would take a rich person to learn to stop walking though the forest?” He can expand on that simple point by talking about how people would use other alternative routes or, in more practical, modem-day terms, how people would use tax devices to save themselves from being taxed unduly. We see all kinds of tax-saving vehicles available to people in middle and upper middle-income brackets these days. It does not take people who have a high income very long to learn effective ways of saving that capital or otherwise protecting their income.

He uses, too, a mythical example of a city -- call it Toronto -- where members who share a political philosophy like the New Democrats might sit down and say: “Let’s tax everything above -- we’ll pick a number -- $75,000. It’s a pretty high number. There’s no individual family who should not be able to provide for all of their needs on $75,000, so all of those people in this city of Toronto who earn more than that we’re going to tax 100 per cent of it away.”

You can then ask the rhetorical question: “How much additional capital would these NDP philosophers collect when they implemented this new tax scheme?” The answer, of course, is that they would not collect any additional revenue, because anyone whose earnings were greater than $75,000, for example, would move. I think that this has been a phenomenon that has been happening in this country for some time, where, increasingly, through the public pronouncements of the New Democrats in particular, individuals and corporations can see that they’re hostile to profit; hostile to capital and they tend then, very simply, to move.

Mr. Samis: You’re sounding like Bill Bennett.

Mr. Ashe: You should have more of your buddies in here to listen.

Mr. McCaffrey: There’s nothing more flexible than capital.

Mr. Samis: Where would they move to? Quebec?

Mr. McCaffrey: They have moved to the States. They’ve moved to Phoenix. They’ve moved to Houston. They’ve moved in large numbers, actually, and I think that to an alarming extent, the people who are insensitive to money, to capital and to the fact that it’s a highly mobile medium, I don’t think you realize the kind of impact that you have when you constantly threaten, through committee investigations and so forth, corporations that might have had a particularly good year. I want to get into that a little bit later when we talk about the employment development fund.

To summarize the thesis of this economist Laffer, as the tax rate goes up, the tax base goes down. You cannot increase the tax rate without people finding other ways to bury it, to otherwise hide it, with no additional revenue for the government in question, or, what’s even worse, people will move to what they perceive to be a more hospitable environment.

[4:45]

I mention that because I think the maintenance of a premium here in Ontario was an important recognition that you cannot go back to the progressive tax base for everything and that there is an obligation that governments have, and thank goodness this government has it, to show taxpayers as much as possible where their tax dollars go. If people learned nothing else from that committee work in the summer of 1978, I think the fact that $1 billion, approximately 25 per cent of the money spent on health care in Ontario, comes via the premium route was an important point. I think it could be improved a good deal by advertising programs, and perhaps the odd message to constituents by members of this Legislature, to show people the premium does raise about 26 or 28 per cent of the money required for health care, that it does not pay it all.

One of the things I learned from that committee’s work was that some of the opposition MPPs showed surprising insensitivity to taxes and the way taxes have an impact upon people. The member for Scarborough-Ellesmere (Mr. Warner) is not here just now, I kind of wish he were here.

Mr. J. Reed: Our insensitivity is to this government’s spending.

Mr. Ashe: Speak to your buddies down in Ottawa.

Mr. Ruston: You guys have outspent them.

Mr. Ashe: That will be the day; in fact ours is petty cash in comparison.

Mr. Ruston: Just look at the budget and see who has spent the most over the last 10 years, has had the biggest increase; Bill Davis’s government.

Mr. Samis: What has Joe Clark promised today?

Mr. McCaffrey: The member for Scarborough-Ellesmere (Mr. Warner) indicated during the work of that committee that he had no idea how much income tax he paid. It doesn’t surprise me. When one looks at the NDP caucus I think about half of the good people there were school teachers before coming into public service.

Hon. Miss Stephenson: Or social workers.

Mr. McCaffrey: Or social workers. I think probably more than 50 per cent of them have never had the opportunity --

Mr. Ashe: To work.

Mr. McCaffrey: -- to have a cheque in their hands or cash in their hands that did not come in some fashion directly from the public pot. As a former school teacher I think I can say that without fear of contradiction here.

All members of the Legislature would be well served, but particularly the New Democrats, if for just one 12-month period everybody received his or her cheque every month without any taxes having been taken off.

Mr. Samis: How about if Steve Roman paid taxes like the rest of us?

Mr. McCaffrey: Then once every three months the member for Cornwall and his colleagues would have the opportunity to sit down and write out a cheque to the Receiver General of Canada, paying the amount that is normally deducted at source. It’s just like someone, say a school teacher, who has never had a cheque in his hand on which he had to pay any additional tax but just got the net fee; it was all laid out on the form how much went to his pension plan and how much went to health, et cetera; and how much went to federal-provincial tax --

Mr. Samis: You sound like a cross between Milton Friedman and Jackie Kemp.

Mr. McCaffrey: -- so that he only looked at the net figure. He never paid that much attention to the gross figure and therefore he wasn’t conscious of how much money actually goes out to various levels of government.

I make this in the form of quite a serious recommendation, that all of the members of the Legislature would be well served if, for just one 12-month period, no deductions were taken off, and once every three months, or once a year, they paid that one big cheque to the federal government, and the other cheques as necessary.

There are countless people in our society, taxpayers and voters, who don’t have the luxury of having all of these things deducted at source, who don’t have the luxury of regular funds being taken off for their pension plan, who don’t have the luxury of paid vacations and who don’t have the luxury of having somebody else do the bookkeeping for them. It does bring it home pretty dramatically when you have to sit down and take a look at what is left over when you have paid these various levels of government for services.

I mentioned that in my judgement a number of citizens have been frightened away from this country, frightened off to the United States. I believe that. I believe a great many people have seen that the New Democrats in particular are so inhospitable to capital and investment income, and as a result a lot of people have opted to move.

I’m concerned when I hear members of the New Democratic Party talk about foreign investment and their fear of foreign investment in this country. It was brought up in question period today by the member for Nickel Belt (Mr. Laughren). I forget the exact question but it had to do with the amount of dividends paid to foreign owners of Canadian subsidiary firms.

Everybody is put in a bit of a dilemma by this kind of talk because concern about foreign investment in Canada touches on fairly strong nationalistic urges that we all have in wanting to keep this country for Canadians and for Canadian investors. The real problem is, by the time a series of ground rules are set that would make this environment inhospitable to offshore money or to foreign money, those same ground rules make this environment inhospitable for Canadian domestic money. In the words of that great socialist philosopher the member for Sudbury East (Mr. Martel), “You can’t have it both ways.” Ground rules that would make it impossible for an out-of-country investor to be attracted to this country cannot be set up without at the same time scaring off our own Canadian domestic capital.

There is only one series of ground rules for money and money is fluid. Actually, you put yourself on the horns of a dilemma there because you do try to have it both ways. There is an unbelievable preoccupation with multinational companies. It hits a responsive nerve end outside. It is fashionable these days -- and you can pick the company, Imperial Oil, International Nickel -- to be against the multinational corporations and to see all kinds of sinister implications in the establishment and growth of a multinational company.

I am amazed, after the hearings of the select committee on Inco layoffs back in the fall of 1977, when one of the things that became fairly clear, and four or five members of the New Democratic Party were on that committee, was that in most measures today International Nickel Company is not in fact a foreign company; 52 per cent of the company shares are owned by Canadians. It is a classic illustration; those members are treating it and applying to it all of the sinister motives they would to a company that might be wholly owned, or in large part owned, by a US parent. Yet Inco, if that is a reasonable measure and I can’t think of a better one, is 52 per cent owned by Canadians.

When it came up in that committee I was always appalled by the attitude. The evidence was there, in black and white, that there were eight million shares of International Nickel stock held by Canadians. In spite of that, the NDP members still wanted to go back to the old game of trying to suggest it was some rich New York corporation or rich matrons in Rosedale riding who were controlling the ownership of that public company, forgetting that all of this information is public. The Ontario Securities Commission laws are quite clear in this regard. These companies have to report quarterly; it is public information as to how much they earn, what their expenses are, who the shareholders are; and share ownership can change from year to year.

Yet on a regular basis, I think sometimes for motives that are purely partisan in nature, some members work on this old straw man of the out-of-country capitalist who is somehow doing a disservice to Canadians, failing to recognize the other side of the coin; the number of Canadians who actually own many of the shares of these companies, the dividends paid to Canadians, the income earned by Canadians and the taxes paid to Canadian governments in order to provide social services in the respective communities.

I am not one to stand here and defend International Nickel or any other company. They don’t need that kind of defence; but I do think they all, small and large companies, need a little more awareness of why they invest, more recognition that they have the option to move. They can move very quickly, and any time one of these straw men is set up, again members should recognize that by scaring them off they are scaring Canadian capital out of this jurisdiction as well, and I think they are doing those they purport to serve the greatest disservice of all.

The recent budget gave some details about the Employment Development Fund, the $200 million that has been set aside to assist Ontario taxpayers by encouraging existing companies to expand and putting them in a position where they can hire more people and provide more jobs. Ultimately, they can pay more taxes to help us underwrite the social programs that everybody here is committed to. I am a little bit concerned when I see some people, particularly members of the opposition, talking about the paradox of a government that will on the one hand fail to give an additional $6 million to the TTC and yet find $100 million for Ontario pulp and paper companies or $28 million for Ford when Ford had made its decision to expand. I don’t see any paradox in that at all. I think it’s an indication of the government’s relationship with the private sector. The government’s obligation to help these companies expand is intimately related to the government’s obligations to meet some of the social commitments we have.

I don’t have the exact numbers in front of me today, but I have talked in the past to members of the Canadian Pulp and Paper Association whose head office is in Montreal. They are the people who have been responsible for a series of ads -- maybe some members have seen them in the Globe and Mail -- about the need to provide profits for the pulp and paper companies so that they can continue to expand and grow at this time.

I can recall one or two numbers I would like to get on the record at the moment. In 1977 Canadian pulp and paper companies in Canada paid taxes of $1.7 billion. Those were national numbers. I remember too that in the province of Ontario corporations paid just under $200 million in the form of taxes to the Ontario government. Those are just the corporate taxes. That is not the tax paid by employees of forest product companies in Ontario. The number would be closer to $350 million if that was added in.

The year 1977 was not a particularly profitable year for the forest products industry, but if one took that one year and that number, which I believe to be approximately $350 million, one could do some pretty simple arithmetic to determine how many senior citizens’ homes could be built for that, how many hospitals could be expanded and how many schools could be kept open or expanded, to show that the relationship between corporate profits and social programs is an intimate relationship.

We cannot have it both ways. Every time an industry has a particularly good year we cannot threaten to have them down here for some kind of an investigation. I am amazed when the leader of the New Democratic Party shows that he’s read at least one or two of the current year’s articles and knows that the forest products companies have had a fairly decent year, that he singularly fails to recognize that they had about 10 or 11 dismal years prior to that. He has stood up in this House in question period, at least several times that I have seen, and wanted not only to have an investigation into some of the profits of the food companies but has suggested that to spend $100 million of taxpayers’ money now on the forest products companies because they have had a good year is a bad use of money.

Of course it’s just the absolute opposite. They had a good year in a large part because of the weakness in the Canadian dollar, a phenomenon that is not likely permanent in nature. It’s another bit of good judgement on the part of this government to spend some taxpayers’ money here in the form of an investment to encourage these companies to spend some of their own money now -- it’s on a one for three basis -- in order to maintain existing jobs and provide new ones on a longer-term basis.

Among the new buzz words I find in this place these days are “research and development.” How on earth we can encourage these companies to spend more money on research and development and at the same time want to investigate their profits every time they have a decent year eludes me. We simply cannot have it both ways. The profits that these large and public companies make are distributed almost entirely amongst the shareholders, the overwhelming number of whom are holders of pension funds. The anomaly is that a great many of these union pension funds are the largest shareholders of some of the Canadian forest products companies we have been talking about.

[5:00]

The leader of the New Democratic Party wants the Ontario government as a quid pro quo to get some equity in these companies to whom we are going to lend or give this $100 million. That is patently absurd to me at a time when the value of shares in those public companies that are already owned by union funds, through their pension and other accounts, far exceeds $100 million, and where the real beneficiaries of a profitable cycle are Canadian workers.

I do not find that there is any anomaly in the establishment of an Employment Development Fund. It shows an intelligent use of taxpayers’ money to assist existing manufacturing industries in this province and to encourage others to locate here, once they have made a decision to move.

It should not be lost sight of in the case of Ford -- and I do not pretend to be intimate with the details in that -- that surely the decision had been made by Ford to locate, and it boiled down to Ohio or Ontario. In all likelihood Ford phoned the Ontario government and said: “Look, here is what we are going to do. What can you do for us? If you can’t match or better this deal, we are going to go to Ohio.” Everybody can have some twinge of distaste for this new phenomenon of companies using governments in competing jurisdictions, but it is a fact of life; and the decision was made. When asked what it would do, the Ontario government responded quickly and, I think, effectively under the circumstances. That $28 million will be paid back in two and a half or three years. We have talked at great length in the past here about the number of new jobs that that would create, and I think it is an intelligent use of funds at this time.

I would like to make a comment or two about Armourdale, not only because I find it is a fairly traditional thing to do here at budget time, but also because some of the earlier comments are relevant to the kind of constituency I represent.

I have said countless times, inside and outside my own riding, that Armourdale is a unique constituency; and there are some ways one could measure that. It is a riding in the north-central part of Metro Toronto which has no industry at all. In that sense I think it is one of the unique ridings in the province. About 70 per cent of the taxpayers and voters live in single-family homes, with about 30 per cent then living in apartment complexes in the riding.

One of the overwhelming characteristics of this community -- and anyone who knows anything about it I think could confirm this to be true -- is that it is a community that personifies some of the best of the old-fashioned virtues; in particular, “Work hard and save” is one that comes to mind for me. It is, in the best sense of the word, a middle-class community. The number of people living in their own homes and trying to pay off their mortgages is quite high. One can see, just by walking with me -- and I invite anybody to come along with me and walk some of the streets in Armourdale -- that the people there are house-proud. I think in the overwhelming majority of cases that house represents their major savings; for a lot of people it is a combination of their life insurance policy and certainly the vehicle through which they will get their retirement income. But the classic virtue of “Work hard and save” is one that my friends would share with me, if they knew as much as I do about that area.

A great many people in the community are approaching retirement, and in that sense it is typical of much of the province, in that we have talked in this place about the demographic charts that show the rapid growth in those approaching retirement. That reality has to be reflected in some of the government programs, and I think the budget does that. The recognition that these people approaching retirement will have a greater need for some social services in all likelihood means that the growth of government revenues has to increase, and the only way it can increase is through a healthy, expanding confident private sector.

It is an area too that would be immediately characterized by the number of neighbourhood schools or community schools. There are just under 40 private and public schools in the riding. In some parts of Armourdale, we are now facing the phenomenon of a declining school enrolment on a day-to-day basis. Some of the schools likely face closure if the school board determines it to be the case.

The Minister of Education (Miss Stephenson), who is here this afternoon, and I have talked about this in the past. Much of her own constituency is very similar to mine. There are ways in which we can deal with the problem of declining school enrolment in what we have termed a creative and innovative way, where we might use some of these half-empty schools for senior citizens’ facilities, be they in the form of drop-in recreation centres or whatever. I think we can make some specific recommendations to the local board of education on that.

It is a good community. The people are responsible. They recognize the facts of life and that one cannot get anything without paying for it. I think they are pleased in large part to see that health premiums are maintained and that this government resisted the temptation to go the progressive income tax route to fund that extra $1 billion in revenue. That was a responsible and courageous decision. I think they appreciate seeing as much as possible their tax dollars identified and visible so that they can see where they go. We have enough hidden taxes already.

As an aside, I was quite surprised to see that the Ontario Economic Council made a recommendation that premiums be abolished and that money be raised through the progressive income tax. I do not have their report in front of me, but one or two sentences stand out fairly clearly. I am paraphrasing it, but they said that politically it would be a lot less painful when the additional revenue was needed to raise it through an increase in personal income tax rates. It is less visible, and politically we would not be seen to be doing it, whereas if premiums are increased by 5.3 per cent, as was done, it is front and centre and it is visible to most people. It is good that the government did the courageous and responsible thing.

On balance, I think it was a good budget, a budget that was realistic and attempted to reduce the deficit once again in the current year. A balanced budget is a commitment that is very well received in my area. People constantly work at balancing their own budgets in their firms and in their own homes and they expect nothing less from the government. They expect the government to do it as soon as it is feasible without destroying any social programs that are already in place and to do it, as I think it will be done, by intelligent restraint while at the same time making certain that we can provide an hospitable environment for domestic and out-of-country capital.

The need to stimulate investment and create jobs is a real problem; it is no longer a theoretical concern. To the extent that this is done in the next decade, we will measure the extent to which the social programs we all want will be fulfilled.

Mr. J. Reed: Mr. Speaker, it is a privilege to rise and speak to the budget which has been presented. It is a privilege because it gives this member an opportunity to talk for at least a short while on his area of criticism, perhaps mainly because the budget that was presented this year is the most devoid of any attention to energy of any I have ever had the misfortune to sit through. As a matter of fact, the most attention this government could give to energy in this budget was to forgive the sales tax on solar heating systems or on the other parts of solar heating systems which they had not already forgiven.

It is getting to be quite a joke, this game the government plays concerning its attention to energy. Did you know, Mr. Speaker, there is still a sales tax on stovepipes? The sales tax was taken off wood stoves, but there is still a sales tax on stovepipes.

Mr. Ashe: This is a really big issue.

Mr. J. Reed: I am just trying to point out the comprehensiveness of it all -- or the in- comprehensiveness of it all. Did you know, Mr. Speaker, there is still a sales tax on efficiency-raisers for fireplaces: thermogrates, hollow-tube grates and one thing and another?

I have been upset so many times about the government’s approach to energy that it is hard to get my adrenalin going again --

Hon. Miss Stephenson: Watch your blood pressure.

Mr. J. Reed: Perhaps getting one’s blood pressure up at the appropriate time has its effect; I hope it is not negative on me.

I just wonder what this government really is doing about energy. The truth is that if one asks the government if it has an energy policy -- I hope the member who is in the House, and who may by some appointment in the future become the new Minister of Energy, is listening -- as the government has been asked time and time again what its energy policy is, it never responds.

Mr. Kerrio: Those ministers are like kamikaze pilots.

Mr. J. Reed: All five of them now, since I have had the privilege of being energy critic. They come and go, and I suppose we will be through the whole caucus before the next provincial election.

I feel badly for the Ministers of Energy in many respects, because they really do not have a true ministry to work in; they are really operating a policy secretariat which is more of a monitoring agency than it is anything else. One of the first thrusts of a Liberal government in Ontario would be to make the Ministry of Energy a full-fledged ministry and give it the kind of attention it deserves.

It is very easy for us, I suppose, to slough off energy -- or it has been up until now -- but we should realize that in California today gasoline is being rationed; that in Florida gasoline has been rationed now for the last two or three months; and that North America has become such a profound importer of petroleum -- and I am including the United States as well as Canada -- that we are very vulnerable to whatever happens in the Middle East.

I got some figures today that gave us a little breakdown of where our imported oil comes from, in 1978, we imported fmore than half a million barrels a day of oil from outside of our borders; 21.5 per cent of that came from Iran, and somewhat more than that came from Saudi Arabia. There was some concern expressed about the upheaval in Iran and the kind of impact it was having, particularly on the United States and to a lesser extent on Canada. Now picture, if you will, one more country that is an oil producer going into the state of upheaval that Iran has gone into. It should be cause for concern in a province that is the largest consumer of energy in Canada. It should be of concern to a government in a province that represents a people who are the largest consumers of energy per capita in all of the world.

[5:15]

It’s an incredible indictment; such a profligate use of energy in Ontario. We are the largest consumers per capita in all the world; that’s a statistical fact. We use much more per capita than the United States. It makes me wonder how we can continue to do so when we consider that more and more we are a global village, more and more in Ontario we will have to depend on being able to compete in the world market with our technological excellence, with being able to sell product and expertise to the highest level of our talents. We will be depending less and less on the export of raw resources; we have to.

We have to migrate in direction; that’s obvious. Whether we purposefully start out on that path, or not, it will be inevitable. It’s like the fellow selling the oil filter, “You pay me now or you pay me later.” We do it in a less dramatic way if we do it gradually, but it becomes very dramatic if it has to happen to us all of a sudden.

Our consumption of energy is incredibly important in this scene. If we are the highest consumers of energy in the world and if the energy is proportionately of greater cost, thus having a greater cost input into our production, surely that has to have a negative impact on our ability to compete in the world market; there is not only the business of being a higher consumer and having a higher energy input, but also the question of availability.

I know the argument that our nuclear industry is somehow going to save us. This is a misconception, and I say it in all seriousness. Most of us who stop and rationalize it for a while will appreciate that to transfer technologies quickly from, for instance, petroleum consumption to electrical consumption, would be a very costly and cumbersome process. It’s true that some things can be transferred but many of the things that consume the kinds of energy that we import in such great quantities cannot be transferred quickly. Imagine, for instance, the magic that would be required to have a million automobiles in Ontario drive out of the garage tomorrow morning, electrified. That’s the kind of transfer technology which just is not part of our ability to achieve quickly. So, to suggest that electric power can substitute or take over where petroleum leaves off, from a technological point of view is difficult. From a cost point of view it is even less desirable.

It’s amazing to me that when we talk about the energy options available to us we have essentially put all our eggs in one basket and we have not given sufficient attention to energy options in the other directions, when the truth is the economics of the situation would dictate that there is a very profound place for many other energy options on an economic base.

I’m going to outline just a few of them for the consideration of the government. I do this every now and again at my own peril, because what happens is, the government pooh-poohs the idea but about 18 months later they become the government’s own creation. I’m going to go on record with a couple more areas of Liberal energy policy, and we’ll see what happens to these in about 18 months.

Mr. Haggerty: Maybe you should have a quorum.

Mr. J. Reed: The only satisfaction I get from doing this is knowing that at least the people of Ontario will be served a little better because it’s happened. I am not naive enough anymore to pretend that I may somehow get some credit for having introduced the idea.

There is a potential there. Understanding that we import 80 per cent of the energy we use into the borders of our province, understanding that the bulk of that importation is petroleum, and understanding that every dollar of investment that we can transfer from energy imported to energy created inside this province is a positive step -- and most of us who understand a little bit of basic economics understand that when the wheel turns over inside our own borders it has a positive effect in overcoming this $4.5 billion deficit in our balance of payments that our energy imports impose upon us -- we have an obligation and a duty to develop those energies that can be indigenous to us.

Nuclear power is one. Nuclear power, with all of its concerns, provided the proper information is shared with the people of Ontario, can take its place in the energy mosaic in the future. The concern I have about nuclear power is that it’s being sold as the only alternative. The concern I have is that the technology and its development and the weaknesses of the system have not been shared fully with the people of Ontario.

Mr. Haggerty: And the weakness of the minister too.

Mr. J. Reed: There seems to be some inherent fear on the part of the technologists that sharing the problem in the system is going to create some sort of panic. I think just the reverse has shown itself to be true. With the events that have occurred in the last few months, it would seem that what we must do is to reveal to, and share fully with the people all the information regarding this high-technology energy source and let them make their decision about Ontario’s nuclear future in a reasoned and rational way.

If we don’t do that, if we hold back, if we tend to hide information and if we don’t make it public, then surely we will destroy the nuclear industry, just as surely as I’m standing here. We have that obligation. The people of Ontario deserve no less than to have a complete revelation.

If the technology is not suitable, if it hasn’t been developed enough and if it has too many weaknesses to be considered to be an acceptable risk, then that hard decision will have to be made. Frankly, I have more faith in the technology than that. But the fact is that everything has to be put above board, if the industry is to have a future at all.

I’m concerned that it is being sold as the only thing; it’s all the eggs in one basket. Let’s look at some of the others just briefly. How much money, how much time and talent and how much thought has the provincial government given, for instance, to the production of alcohols in Ontario, other than the revenue it generates from the other end use? I am talking about fuel alcohol. There’s a tremendous potential.

Mr. Ashe: At about six bucks.

Mr. J. Reed: I just wonder if this government has ever gone to the federal government and asked them to drop the $300,000 bond necessary to be in possession of a still to make alcohol. We all get a good chuckle out of this, but the truth is that the production of ethanol has been, in the past, a part of agribusiness. If you look back into the 1930s in western Canada, you’ll find the farmers were running their tractors on locally produced ethanol -- grain alcohol. It has been calculated that the production of about 11 acres in an agribusiness operation of sugar beets would provide all of the energy that farm would need.

One might say it’s going to take another investment to have the kind of little processing operation to make one’s own, if a person was going to do it himself; but the truth is, as my neighbour who is a now retired farmer once told me, “It’s not how much you make on the farm, it’s how much of it you get to keep.” I don’t know why the government doesn’t even recognize the potential for such a simple thing.

I’ve been to symposiums that have looked at the economics of wood alcohols -- methanol is the other name for it. A study has been completed by this government on the cost and the potential for methanol production in northern Ontario -- not denuding the forest, as some people would have us believe, but using the wastes that are sitting up there rotting at the present time. We get all kinds of these mediocre objections as to why the thing won’t work.

I realize and I acknowledge that the oil companies have a vested interest. We are told quite quickly by the oil executives that alcohol is hard on internal combustion engines. The truth is that alcohol has a deteriorating effect on some vinyl lines and certain kinds of neoprene, I think, and that’s the beginning and the end of that. Many of the automobile companies have engines designed and ready to go that will burn pure methanol. There’s no big deal about it. Alcohol was the first fuel for internal combustion engines before there was such a thing as gasoline.

In Brazil, at the present time, there are 300,000 automobiles running on pure methanol, and because that country doesn’t have a good supply of its own petroleum, there is up to a 20 per cent inclusion of alcohol into gasoline for those other automobiles whose technology is geared to gasoline burning. It improves the octane rating of the gasoline and makes the car burn more smoothly. In a northern climate, of course, it’s gas-line anti- freeze. You don’t have to worry about your gas lines freezing up.

I don’t know whether I should get into much more of it but the fact is we do have this option as a liquid fuel. The technology can be easily integrated into our present internal combustion technology. There is no problem with it whatsoever. We can begin to make it out of natural gas. As a matter of fact, I have already written to the federal Minister of Energy suggesting that northern gas, arctic gas, polar gas if you like, Mr. Speaker, might very well be converted to methanol onsite, rather than dealing with the prospect of having to transport LNG with all of its inherent dangers. A shipload of alcohol does not present a serious environmental threat. It simply disperses in the water and becomes part of the protein in the food chain.

[5:30]

The longer view of this sort of thing is that it would give us the opportunity to gear up for renewably produced alcohol, to start with. The next thing is that it would give us, as a consuming province, a tremendous improvement in bargaining power when it comes to acquiring the petroleum we need. If we have an alternative technology on line and ready to go, and when it’s only a matter of two or three or four years to put the thing in gear and make it a reality in Ontario, surely it’s got to help keep the exporting oil countries honest, at least, when it comes to negotiating the price of petroleum.

It’s only one option. I could go into it in a lot more detail. The government has chosen to ignore it and continues to ignore it.

Mr. Ashe: Not so.

Mr. J. Reed: How much money has the government spent on methanol production, other than on studies? Not one zip.

Mr. Ashe: We don’t like to waste money as you do.

Mr. J. Reed: The federal government is the only group doing any work on this at the present time.

Mr. Ashe: We’ll make sure it’s practical.

Mr. Kerrio: The federal government has no partners.

Mr. J. Reed: Just a few minutes ago, the member for Armourdale was talking about the business of stimulating industry, small business and employment. It seems to me that if the government is really doing some serious thinking about the future one of the areas where it can stimulate that industry is in the energy industry itself. It doesn’t take any great amount of brains to figure that out, I don’t think.

Mr. Ashe: That’s right. That’s where we agree.

Mr. J. Reed: Just as long as the government does something about it.

One of the other areas is the redevelopment or the redeployment of small hydro power in Ontario. There are in existence at the present time about 4,000 dams in Ontario holding back water. There are very few of them contributing any work other than holding back the water for the purposes of maintaining levels for cottagers or some water control scheme here or there. Very few of them contain any kind of energy-producing device. Yet Ontario, which had the first commercial electric power in North America, which had abundant water power, whose economy was based on that renewable resource, and where the very real wealth of the province was created, has abandoned it.

At the present time, it’s very easy for us, when we’re thinking in thousands of megawatts and we have these grandiose ideas about millions of horsepower here and there, to say that 500 kilowatts or a megawatt or two megawatts are insignificant. The truth is that when we add them all up they’re not insignificant at all. There are literally thousands of sites which could be developed and which could make a very real contribution, albeit on a small business basis, to the economy of Ontario.

It’s been all too easy for the government to make an assessment about the economics of that sort of thing. I remember the first Minister of Energy I had the pleasure of meeting in the first estimates I was in. The first thing he did, when I talked to him about small hydraulic power, was to say: “It’s just not feasible. It just costs too much money.”

I said: “Why don’t you turn it over to private enterprise and forget about the economics of it. It’s not for you as a minister to say whether a private-enterprise operation is economic or not economic. Let the facts speak for themselves. Simply create the climate and get the situation together where these people can do it, if they so desire, where they can move without walking into incredible red tape in the various ministries. Give them a chance.” I said that because I have some working experience with the situation myself, as most of the members here know.

I believe there are many areas of small hydraulic development. If the government is not interested in them and if Ontario Hydro is not interested in them, then fine. Let the government say it’s not and let private enterprise do its thing and do something to facilitate it. Don’t give it a handout. Nobody wants the money. Just let it happen, instead of holding it back.

Another area that is kind of interesting and which the government is not pursuing in any serious way is the subject of methane production for agriculture. I recall having a discussion about three years ago with a man, who shall at this point remain nameless, who really wanted to develop a practical, low-cost methane generator for Ontario agriculture.

There was a study done on the economics of it, and he was told it really wasn’t feasible because methane would not be competitive until gasoline reached $1 a gallon. Isn’t it interesting? Here we are. We have already arrived at that point, and there are no low-cost methane plants available or designs available for farmers to build them.

As a matter of fact, the one that has been developed that shows the most promise, not surprisingly, is American. That seems to be the way it goes. We become super cautious somehow and we miss the boat. Some of our neighbours who are a little harder pressed energy-wise in the south and so on get on the bandwagon. Now they have the technology, and you can bet your bottom dollar, Mr. Speaker, we will be buying it within a very few years.

The need for research and development tends to be pooh-poohed from time to time, but the need for it in energy and in decentralized energy is acute at the present time in Ontario. I think the members across the House will agree with me when they look at the world scene and see what is happening and when they look at Ontario’s vulnerability in this mosaic.

When they understand that we can’t put all our eggs into the nuclear basket, where we have to look at the energy options on the broadest possible base, then the only way we can go in less than a generation is though comprehensive research and development, through demonstration and through the kinds of things that may seem very foreign to this government, but are things people can see and do for themselves.

I know that takes us down another path. That takes us away from the large centralized, beat-big-drum utility where we can say, “Look at this modern miracle of technology.” I am indeed talking about simpler technologies. I am talking probably in the long term about lower-cost technology and I am talking very much about the kinds of technology that will contribute a great deal more to our economy in Ontario than nuclear power can ever contribute.

I say that with all sincerity because I think all the members of this House know and understand that the construction of centralized utilities is very capital-intensive and the number of jobs it actually sustains per dollar invested is about the lowest of all investments that we make in Ontario, whereas the decentralized energy thrust is far more labour-intensive and far more diffuse, diverse and more stabilizing actually to the province. If we can, if we still have time to develop a decentralized energy alternative in Ontario, it will strengthen our energy security and I think we are perhaps very slowly beginning to realize that.

The other area of the budget I was disappointed in was in connection with energy conservation. I couldn’t find in that speech any addressing of the need to conserve energy. I should point out to the members one of the lowest-cost ways to pick up energy capacity in Ontario is to conserve it. It’s the cheapest barrel of oil: it’s the cheapest kilowatt of electricity. We know we can insulate a kilowatt of electricity for half the price of building a kilowatt of generating capacity and it doesn’t matter in the overall which way we do it in terms of picking up that capacity.

It has been estimated that in insulation alone there is a potential saving of about 5,000 megawatts. This amount of power represents all of Bruce A and all of Pickering A, which represent the total operating nuclear investment we have at the present time. Why are we afraid to do that? Why is the government ignoring that obvious option? Why is it shying away from that? Why are we simply paying lip service to conservation and not getting down to the nitty-gritty of really being serious about it.

I say that in terms of other aspects of energy we can control in Ontario. What about utility efficiency? At the present time, on a mean average consumption basis, we only use slightly over 50 per cent of the capacity that’s available. This is because we buy our power in peaks and hollows during the day and we have annual peaks and so on. There admittedly has been of late some interest in these peaks and hollows, but I have seen nothing in my three years that would indicate there’s any serious effort to change that picture and fill in those gaps and make the utility more efficient.

There are ways of doing it. We can offer price-type incentives or costing incentives to consumers in such a way as they would tend to buy more base-line power. That was brought out in the select committee. There is the whole concept of a broad price structure change which would incorporate certain incentives to raise the efficiency of this system and in the end lower the cost of electric power. If there is a manufacturing centre that can run 24 hours a day, one can get more out of his investment dollar than if it runs eight hours a day or 12 hours a day. But this in truth is what we are doing with our utility.

We have all this machinery in gear and all this personnel in this great utility all across the province but we are not making the most use out of it we can. The utility itself has really done little to look at some of its efficiency-raising options such as load management. But I will say, to the credit of the municipal utilities, they have been taking up the idea and they are beginning to get on the ball. I see with great satisfaction the city of Guelph has a computerized load management system that in a few months of operation last year saved the city $85,000 I believe.

[5:45]

When we first brought up the subject of load management with this government -- and I think that was about four ministers ago -- the idea was just pooh-poohed and thrown into a corner, and any thought of changing or taking a fresh look at this thing and what we could do to improve the situation was simply ignored.

I am always amused that the government simply goes on the defensive in almost every case. I have not, from a number of ministers, ever seen a response such as: “We think that’s a good idea, and we’re going to do something about it.” Yet not all the ideas coming from this side, as the members will know, have been bad ideas. As I said earlier, some of them have been adopted by the government -- with no acknowledgement to the critic, of course.

If I have time, I would like to spend a few minutes discussing one other area of decentralized energy that is becoming a new reality in Ontario; that, of course, is the consumption of wood and the production of wood-burning apparatus of one sort or another.

A number of industries that are manufacturing wood-burning equipment have sprung up in the last five years.

Mr. Kerrio: The President is putting one in the White House.

Mr. J. Reed: Yes, even President Carter has become a customer. I do not know where he is going to get the wood though.

Mr. Ashe: He’s going to chop down the cherry trees.

Mr. J. Reed: The fact is that, while four or five years ago that would have been looked upon by the government as being an insignificant sort of thing that we should not be paying any attention to, today it represents the lifeblood of a number of small communities around Ontario.

I have visited some of the factories that are producing wood stoves in quantity. Mr. Speaker, do you know that 750,000 high-efficiency wood-burners were sold in the United States last year? That is a tremendous change from the situation 10 years ago.

But let us look at the government’s response to this sort of thing. With the agriculture critic, I sat in on a meeting with a company that produces steam boilers which are wood-burning and hand-fired, discussing its problems with the Ministry of the Environment and so on in getting this kind of wood-burning unit approved. I hope we made some progress through that meeting, but I detected a feeling there that hand-fired wood boilers simply would not meet the air quality standards imposed by the Ministry of the Environment, because for a couple of minutes they produce second- or third-grade smoke or something like that.

Mr. Ashe: The member’s leader was the first one to point it out.

Mr. J. Reed: If my friend wants to get on to that kind of subject in terms of the environment and talk about the quality of wood smoke as opposed to number two smoke from coal or oil, I will debate that any time. Wood smoke is one of the least offensive and most innocuous kinds of discharges that we could possibly have, and most of the byproducts of that combustion are taken back up in nature by the trees and recycled.

This is one of the anomalies in the Ministry of the Environment. They will put standards on where they will not accept wood smoke, of all things, but some other kind of smoke that is of a lower grade can continue for 24 hours a day and nobody pays much attention to it.

I can outline some more problems. There is a device called an add-on wood-burning unit that is designed to go on beside an oil burner, a gas burner and so on.

Add-on wood-burning units have had a reputation which has not been the very best for a lot of reasons, but the manufacturers have set about to create standards for themselves and to manufacture add-on wood-burning units which would meet every safety standard one could impose upon them. Yet both the Ministry of Energy and the Ministry of Consumer and Commercial Relations continue to suppress the development of a truly safe standardized -- in terms of safety -- add-on wood-burning unit. They simply take a negative point of view.

I pointed this out to the Minister of Energy (Mr. Auld) and to the Minister of Consumer and Commercial Relations (Mr. Drea). The staff simply tends to stick in a negative mould and not recognize the new reality and move with it and try to bring these standards along.

I even recommended to the Ministry of Energy two years ago that they publish a book on wood combustion, understanding that wood firing had really skipped a whole generation, or a generation and a half, and that it would be in the interest of the people of Ontario if they had a comprehensive, informative book that would point out the dangers, that would point out the safety moves that can be made, that would point out all of the positive aspects of burning wood as well.

So far that has not come into existence. We do not have a complete book on wood burning in Ontario. Yet wood is one of the renewable resources which is coming back into its own very quickly. It is going to take its place at a certain level and will so long as energy continues to rise in cost.

I was quite interested in the Treasurer’s announcement of a new investment corporation that would attract investment for small business. It sounded very encouraging at first. I was quite encouraged because, as you know, Mr. Speaker, our party has always been very supportive of small business. We thought possibly this had potential to improve it.

But if one looks at what is offered, what one finds out is that there are so many requirements on this thing that really all it does is provide a way to get a 30 per cent write-off on a safe venture. We really do not think it is going to end up doing very much. It reminds me of the Venture Investment Corporation of a few years ago that was offered hopefully as an incentive for small business and there wasn’t one taker at that time.

Is that what it was called, the Venture Investment Corporation?

Hon. Mr. Brunelle: Yes. The federal government did not co-operate.

Mr. J. Reed: There was not one application. Nobody wanted it. It was a total flop in this province.

When we talk about jobs and investment and when we talk about small business it seems to me that kind of thrust dovetails with energy and decentralized energy very well -- where one has an energy technology that is available at a local level, that can employ people, does not have to be centralized in one area, that can provide the energy security that is needed in Ontario, and help, we hope, to discharge this $4.5 billion annual deficit we are paying out of the province for the energy needs at the present time.

Mr. Speaker, I am grateful for this opportunity to present some of these thoughts on energy. I trust that the government, while ignoring them now and probably belittling some of them, will take them on in the next 18 months.

On motion by Mr. Williams, the debate was adjourned.

The House adjourned at 5:56 p.m.