Legislative Assembly of Ontario

The House met at 2 p.m.

Prayers.

STATEMENTS BY THE MINISTRY

CORRECTIONAL SERVICES DISPUTE

Hon. Mr. McCague: Mr. Speaker, in view of the unlawful strike that has now been commenced by employees in correctional and other institutions in this province, I think it important that I review for the members the events that have led to this unlawful action and the efforts the government has made to prevent it.

The members will recall that the question of whether a separate category for salary purposes should be created has been a matter for discussion between the government and the Ontario Public Service Employees Union for some time. Recently the union indicated it would be recommending strike action to its members if government would not accede to the union’s demands. Since about November 10, the union has engaged in a concerted effort to procure a strike of the employees to achieve their objectives.

Notwithstanding the government’s opposition to the union’s proposal, and faced with the obvious concern expressed by the employees with respect to this issue, I offered, on behalf of the government, to submit the matter to final and binding arbitration by an independent third party. I made that commitment on November 28, 1979, in a meeting I had with Mr. Sean O’Flynn and some of his colleagues.

The union took a strike vote among the affected employees on November 29, and the employees voted in favour of a strike.

That same evening, I delivered to Mr. O’Flynn a letter in which I reaffirmed the commitment of the government to resolve the dispute in a peaceful, lawful manner and the commitment of the government to ensure that the law of this province would be obeyed. At the same time, I had delivered to Mr. O’Flynn an agreement, signed by myself on behalf of the government, under which the dispute would be resolved by binding arbitration, and invited the union to sign the agreement or propose modifications to it. I am tabling a copy of the letter to Mr. O’Flynn for the information of the members.

Since my discussion with Mr. O’Flynn on November 28 and his receipt of my letter dated November 29, Mr. O’Flynn has rejected my proposal for resolving the dispute, and he and the union have continued to advocate and counsel unlawful strike action.

In the face of the impending activity on the part of the union, and in view of the obvious public importance of maintaining continuous service in our correctional and other institutions, the government resolved to take every step available by law to prevent the strike, to continue to urge peaceful means of resolving the dispute, and to develop contingency plans to maintain service in the event of unlawful action. Accordingly, on Friday, November 30, the government made application to the Supreme Court of Ontario for an injunction to restrain the union, its officers and representatives from taking action to bring about a strike, and applied to the Ontario Public Service Labour Relations tribunal for a declaration that the strike would be unlawful and for consent to prosecute the union and its officers.

On November 30, the Supreme Court of Ontario granted a temporary injunction until December 5, enjoining the union and its officers from authorizing and supporting strike action. On that date, a further application will be made to extend the injunction indefinitely.

On Saturday, December 1, the tribunal declared that the union had authorized an unlawful strike. The tribunal has fixed Wednesday, December 12 to hear the application for consent to prosecute. I am tabling for the information of the members copies of the injunction and the tribunal’s declaration.

In the meantime, I instructed my staff to meet with the union, to pursue with the union the question of seeking a peaceful disposition of the matter and of granting unlawful strike activity. My staff met with the union continuously throughout the weekend, both through a mediator appointed by the tribunal and in direct negotiations, and continued to urge them to agree to a legal method of resolving the dispute and to call off the strike. Finally, in the early hours of this morning, the union left the negotiations and the strike was commenced at approximately five o’clock this morning.

I have also instructed my staff to remain available on a 24-hour basis to meet further with the union and urge the resolution of the dispute by legitimate means and to end the strike. My colleague the Attorney General (Mr. McMurtry) will be exploring the further legal steps that will be appropriate in order to ensure compliance with the law.

I must stress to the members of this House and to the union the government’s abhorrence at the means chosen by the representatives of the public servants of this province to achieve what they apparently perceive as an important objective. Under our system of law, no responsible organization can choose simply to hold the public up to ransom and flout the law if it suits its purpose. Otherwise, any organization could adopt similar means without fear of any sanction and could follow the system prescribed by law only when it suits its purpose.

Hon. Mr. McMurtry: Mr. Speaker, on Wednesday, December 5, senior law officers of the crown will be asking the Supreme Court of Ontario to continue indefinitely the interim injunction granted November 30 and to expand it to cover all employees in the bargaining unit and any other persons having notice of it.

At the same time I will be asking the Supreme Court of Ontario to commit to jail certain individuals named in the interim injunction for contempt of court as a result of what appear to be flagrant breaches of that injunction since its issuance on November 30.

On December 12, the first date made available by the Ontario Public Service Labour Relations Tribunal, the Civil Service Commission will be seeking the necessary consent of the tribunal to institute proceedings pursuant to section 42 of the Crown Employees Collective Bargaining Act for breaches of sections 25 and 29 of that act by all persons named in the interim injunction and all employees in the bargaining unit in respect of whom there are reasonable and probable grounds to support such a prosecution.

The Crown Employees Collective Bargaining Act provides fines of up to $500 per day for any individual who contravenes the act and fines of up to $5,000 per day for the union. A strike at any time is prohibited by section 25 of the act; similarly, counselling, authorizing or supporting a strike is prohibited by section 29. Also, the Public Service Act provides penalties ranging from suspension without pay to dismissal, depending on the nature of the offence.

ORAL QUESTIONS

EQUALIZATION PAYMENTS

Mr. S. Smith: Mr. Speaker, I have a question for the Treasurer. It comes from an article that was in the Toronto Star of Saturday, December 1, 1979. The paragraph in question says, “Meanwhile, Ontario Treasurer Frank Miller says, ‘If Ontario doesn’t like Ottawa’s method of redistributing oil money, the province will declare itself a have-not province and claim $466 million.’”

Since the Treasurer has repeatedly refused our recommendation that he do precisely that, since he and the Premier (Mr. Davis) have both said it would be entirely inappropriate for Ontario to take this equalization money, why has the Treasurer now, just as he did with interest rates, taken one position in the House and another position in front of the press?

Hon. F. S. Miller: Mr. Speaker, I assume the quotation being alluded to, comes from the very lengthy discussion we had Friday morning, during my estimates debates. I have not personally seen the article, but I assume that is the place it came from.

At that time, I was responding to comments from the two critics opposite. I think if one takes a good look at Hansard --

Mrs. Campbell: None on your side.

Hon. F. S. Miller: Well, in fact, on Friday that was about it.

The issue was one of what Ontario would do with oil revenues and equalization payments. I believe it was the Liberal critic who had raised the question in his opening comments in a very sensible way. I explained that the Ontario position -- if I can recall the gist of my remarks -- had consistently been to try to separate the redistribution of oil revenues from the equalization payments formula. There was no question that the price of oil influenced the amount the federal government had to pay through the equalization formula because of its very nature and construction. However, we pointed out we had asked consistently that be discussed as a separate issue in the interest of the consumers of Canada, not just the Ontario consumers.

I said, looking forward to the future, one would have to start charting courses of action if that success wasn’t achieved. If that were the case, if there were not a redistribution of revenues, it might be necessary to try to make the equalization formula assume a totally different role in the future in Canada. I believe all this will be pretty clearly explained by reading Hansard of Friday morning. I went into it at some length.

Mr. S. Smith: Will the Treasurer clarify for the House whether he will go after the $460-million-odd that we are owed under the present formula, apart from any possible renegotiation of an equalization formula for the future, which renegotiation undoubtedly will be based partly on whether some redistribution of funds occurs? Given the fact it looks as though no massive redistribution of funds is going to occur to Ontario, why doesn’t the minister, at the very least for the first year, take the $460 million we are already owed and use it for low- and middle-income Ontario customers to cushion the blow of the higher oil prices for this coming year? Why doesn’t he do something that simple?

[2:15]

Hon. F. S. Miller: Once upon a time, I used very simple language trying to explain a complex topic -- and it was this one -- to the Leader of the Opposition. I won’t try to do it again. The issue is this: The formula commits the federal government to make payments, but the formula does not provide the federal government with revenue sources to make those payments. Under its traditional and available tax base, 43 per cent of any federal levy comes from Ontario.

We are going to keep fighting for a redistribution of the revenue taken from the consumers of this province to get it back to the consumers of this province, not to the government of this province. It is the consumers who need it. We do not want it extracted 43 per cent out of our consumers’ pockets just to profit the Treasury, much as I would like to balance my budget.

Mr. S. Smith: The Treasurer must surely have heard what I said in the first place, and he must surely realize he is raising a red herring here. Does the Treasurer not agree that if the government of Canada were put in a position where it had to come up with those revenues, it might have some greater motivation to force a redistribution from Alberta, which at present it doesn’t wish to do? Even if 43 per cent of it comes from us, it means that 57 per cent doesn’t, and we would be the net gainers to that extent.

Rather than use it for the Treasury, let’s make very clear that was never the suggestion. I said to use it to cushion the blow to middle-income and lower-income consumers. I made that very plain. If he heard the question -- if he was listening instead of listening to advice from his right over there -- he would know I said he should cushion the blow for these middle-income and low-income Ontarians who would be suffering because of our failure to prevent Joe Clark from raising the price of oil. Take the equalization money. We are entitled to it. Use it to cushion the blow for low-income Ontarians.

Hon. F. S. Miller: In spite of the allusion to the advice from my right, anybody who has had to deal with me in the caucus knows it is very difficult to give me advice from any point right of me.

I don’t think the Leader of the Opposition has understood that the federal government intended to have retroactive legislation. With retroactive legislation still on the cards, there are just no odds in playing games until the decision is taken by Ottawa. Just as with any other retroactive legislation, we can go through all the red tape, all the cost of a bureaucracy, but until that decision is taken as to whether or not they are amending the bill as proposed last fall, it is academic to have this discussion.

REED MEMORANDUM OF UNDERSTANDING

Mr. S. Smith: Mr. Speaker, a question for the Minister of Natural Resources: Would the minister like to clarify for the House just what is the status of the memorandum of understanding with Reed Limited, as has been asked by the member for Port Arthur (Mr. Foulds), by myself and by the member for Rainy River (Mr. T. P. Reid)?

Does the minister agree that, provided an environmental approval is given, Reed Limited and its successor, Great Lakes Forest Products Limited, have been given a licence to cut timber on the 19,000-square-mile area in question, provided, as I have said, environmental approval is given? If he doesn’t agree, would he please clarify for this House what his understanding is as opposed to his staff’s understanding?

Hon. Mr. Auld: Mr. Speaker, I would be delighted. I was in Thunder Bay last Wednesday and I was interviewed by the Canadian Broadcasting Corporation and others in connection with that memorandum of understanding. I have a copy of it here. I find I was reported there as saying the proposed sale of Reed Paper’s Dryden assets did not include that memorandum of understanding.

I also was quoted as saying, I believe, that I understood the purchaser, Great Lakes Forest Products Limited, was looking into the status of the understanding to see if it was legally part of the sale of the Reed assets to Great Lakes.

To correct that statement, I understand a Great Lakes company official has stated that one of the assets for which Great Lakes is negotiating is that memorandum of understanding.

I want to make it clear that the government has not seen the list of assets for which Great Lakes is negotiating. The subject of negotiations, after all, is a private matter, although anything to do with the memorandum of understanding, if it is acquired by Great Lakes, we will be notified about, because they would want to be sure we felt it might still be valid.

I will be happy to inform this House, when the sale has been completed, if the two parties have agreed that the memorandum be assigned to the assets acquired by Great Lakes. Let me, if I may, because it’s germane, relate to the story I saw on the front page of Saturday’s 50-cent Toronto Star -- I don’t normally get it; I get by with the Brockville Recorder and Times on Saturday at home.

Let me just make as a comment about that story that I had been in conversation with Ross Howard, under whose byline it appeared, after him trying to get me and me trying to get him for about two weeks. I would have to say it was really a story or a masterpiece of misunderstanding. What has been confused is the intent of the memorandum of understanding, which is hardly a secret agreement. It was tabled in this House on October 26, 1976, when the then Minister of Natural Resources made a statement about it. It defines a great many things; I won’t attempt to read it all, but what I do want to say is that that memorandum of understanding does not sell or lease any tract of crown land to anybody. What it does is set out the conditions that must be met before the company -- at that time, Reed Paper -- would be issued a timber licence by the government on any part of the 19,000-square-mile area which is referred to in here as annex A.

In our opinion, that memorandum of understanding is assignable. It is assignable without the crown’s consent. The acquisition of that memorandum of understanding by Great Lakes Forest Products, if consummated, does not give it the rights to the 19,000-square-mile tract of forest. Any company legally holding that memorandum of understanding would have certain rights and obligations under the agreement. Briefly, as the Leader of the Opposition has said, the company is responsible for obtaining proper environmental approval, undertaking feasibility studies and developing forest management plans according to proper and approved procedures.

On the other hand, the Ministry of Natural Resources is responsible for providing all the basic information regarding the tract. This includes the forest industry and forest stand operational cruise data -- which, I may say, is complete -- and the water, wildlife, recreational and other resource-based information as well. In addition, the Ministry of Natural Resources must prepare a land-use plan for the area using that information. This land-use plan will outline the land-use decisions that will determine whether an area is to be used for recreation, for trapping, for timber harvesting or whether it is to be used at all in a resource extraction sense, if it is found to be too sensitive to withstand such an impact.

In brief, the memorandum of understanding commits the government and the company to a series of mutually agreed upon steps, in a public -- and I repeat, public -- planning process that will provide the best economic and social benefits to the area.

Interjections.

Mr. Makarchuk: Having made it crystal clear, you now wish to conclude.

Hon. Mr. Auld: I am sorry there are so many honourable members who aren’t interested in this and who obviously haven’t read the memorandum of understanding. I am very surprised at the member for Brantford (Mr. Makarchuk), an ex-newspaperman -- not dumbfounded but surprised.

The licensing of crown timber in the tract is predicated on the company deeming forest operations are feasible, on the one hand, and their following the processes outlined in the agreement.

Finally, we have not been advised by Reed Limited of any wish to terminate the agreement; nor has there been, to date, any cause for the crown to do so.

Mr. S. Smith: I take it, Mr. Speaker, you would like me to ask a brief supplementary.

Mr. Speaker: I thought it was a pretty comprehensive answer.

Mr. S. Smith: It was indeed. It may not have been comprehensible but it was comprehensive.

There are two major issues in question: whether that tract of land should be developed at all; and whether it should be developed by building a new pulpwood facility, as Reed was originally thinking of doing, or simply allowing Great Lakes to cut part of that for use in its proposed new mill in Dryden.

Given that it is a possibility they might want to cut some of that forest just to supply the mill in Dryden and not build any new facility, would the minister not agree that the three matters, upon which he says the company’s plans are contingent before it could go ahead, really come down to only one -- that the plans and the feasibility study are something to be done by the company to please itself -- and that the only one the government has any approval power over is the environmental assessment?

Would the minister not agree, therefore, that the only thing standing in the way of Great Lakes being able to cut some of that timber for its Dryden mill is the environmental approval which the government has the final say over? If he does agree, what will he be doing to make sure that approval is not given?

Hon. Mr. Auld: May I read from the memorandum of understanding which perhaps the Leader of the Opposition has not read recently. On page six, clause (b) reads: “In the event that the company satisfactorily performs all its obligations under paragraph two and four” -- which are back at the beginning, where one might expect them -- “subject to the Crown Timber Act, agrees to grant to the company a licence in respect to the tract having a period of 21 years commencing from the first day of April following the acceptance by the crown of the management and operating plans” -- that includes where the plant goes and all that sort of thing, as I am advised -- “and the feasibility report referred to in paragraph four, that will enable the company to cut a sufficient volume of conifers for processing in the manufactories referred to under paragraph three.”

Mr. Cassidy: Mr. Speaker, I am astonished by what the minister has to say. There clearly has been a change in government policy from the discussions this minister had with Great Lakes earlier when they asked for 5,000 square miles of the 19,000-square-mile tract to be committed to the Dryden mill and were turned down by the minister.

Can the minister not explain why it is that, over the course of the early summer, a request from Great Lakes was turned down and the minister was therefore actively negotiating for the future of the 19,000 square miles? It was at a time, on the second round, when there were active and intense negotiations over the limitation of Great Lakes’s liability for mercury pollution and there were apparently no such discussions over whether or not Great Lakes would take control of the 19,000 square miles.

Why was there such deliberate neglect of this major issue, and why has the government apparently turned a blind eye to the future of the largest single unexploited tract of forest in northwestern Ontario?

[2:30]

Hon. Mr. Auld: Let me repeat what I read in the House a few weeks ago, if I may, Mr. Speaker, from my letter of November 5 to the Great Lakes president and chief executive officer, Mr. Charles Carter, who had written me -- and I will read that letter, too, if the member wants -- on November 2, the Friday before, about certain things I refer to here. My letter was on the Monday before the Treasurer’s (Mr. F. S. Miller) statement. That was hand-delivered and stated:

“I have your letter of November 2 regarding your company’s plans and aspirations vis-à-vis Reed Limited. This is indeed an exciting concept which, if carried through, could add substantially to the social and economic improvement of northwestern Ontario.

“As you appreciate from our early discussions, the difference between the projected needs for the facilities mentioned” -- and I might interject here we are now talking about the Reed operations in Dryden, the existing kraft mill and the fine paper mill -- “totalling 720,000 cunits and the fibre available on presently licensed land” -- which may relate perhaps to part 0f the question the Leader of the Opposition asked a moment ago -- “plus anticipated purchases totalling 575,000 cunits, cannot be provided except from the Reed expansion area.

“Several considerations related to the role and mandate of the Ministry of Natural Resources will have to be weighed. One of these relates to both the rights and obligations vested in the memorandum of understanding existing between Reed Limited and my ministry. Although the forest resources inventory and the operations survey have been completed, the land-use plan for the West Patricia area has not been completed and is not scheduled for completion until April 1981. It is on the basis of this plan that land-use conflicts will have to be resolved.

“Another concern is the mandate vested by cabinet in the Fahlgren commission on development north of 50 degrees north latitude. Finally, and by no means of least importance, we would want to consult with the people of the affected areas, including the native people. The environmental concerns I mention only in passing since these lie primarily within the mandate of my colleague, the Minister of the Environment.

“I should be glad to be in touch with you again as soon as we have had an adequate opportunity to examine these various considerations further.”

I think that spells out pretty clearly there have been no commitments made to Great Lakes other than the financial commitments indicated by the Treasurer in his statement of which I have a copy. I will be delighted to read that too.

Mr. Cassidy: I would like to pursue this matter with the Ministry of Natural Resources. I would like to ask him is it then his position now that Great Lakes Paper has first refusal on the 19,000-square-mile West Patricia tract provided it meets the various undertakings and conditions that were contained in that memorandum of understanding or, if not, what is the precise position? Can he give us a brief and succinct answer, rather than leading us all over the map?

Hon. Mr. Auld: I dislike speculating. Almost every time I do, I get myself into difficulties one way or another. Assuming that when Reed completes negotiations with Great Lakes it sells the memorandum of understanding or it is included in the assets, if that memorandum passes into the hands of Great Lakes, then the obligation which Reed had as far as that area is concerned will flow to Great Lakes and Great Lakes will be in exactly the same position as Reed was prior to the sale. That is not to say that that whole 19,000 square miles -- let me break my rule and let me speculate that half of the 19,000 square miles is found to be suitable for forest production; then certainly an obligation of the government will be to look at the plans that are put forward after the environmental impact study has indicated the kind of processes proposed for use and the location of them.

It seems to me that one of the obligations of the government will be to deal with that first. I would be surprised if there weren’t other woodlands available for others; but again, perhaps there isn’t anything available for anybody.

Mr. Cassidy: Supplementary: In view of the enormous public reaction to the government’s secret wheeling and dealing, which led to the initial agreement on the West Patricia district with Reed Paper about four years ago, can the minister explain why the government should repeat the process almost precisely all over again, in wheeling and dealing, or in watching while wheeling and dealing was taking place between Reed and Great Lakes Paper, to the point where he now admits that Great Lakes has taken on the obligations and the rights of that memorandum of understanding? Why did the government not step in, in dealing with this particular question, and bring it back to the status quo ante, and why the Fahlgren commission was not even informed over whether Reed Paper, Great Lakes Paper or the ministry now has ultimate responsibility for the future disposition of the 19,000 square mile West Patricia tract?

Hon. Mr. Auld: Mr. Speaker, I’m not aware of any great secret wheeling and dealing that’s been going on as far as Reed Paper is concerned for the last couple of years, other than the inquiries which have been received from other people in the business who were interested in acquiring the Reed operation in Dryden.

Certainly there has been no secret that this government was very anxious to see a viable paper industry of one kind or another continue in Dryden. There have been statements made by the Minister of Natural Resources, the Minister of Northern Affairs (Mr. Bernier), the Premier (Mr. Davis), the Treasurer, the Provincial Secretary for Resources Development (Mr. Brunelle) and the Minister of Industry and Tourism (Mr. Grossman) about the necessity, as far as the economy of the northwest is concerned, in seeing that a viable operation be continued in Dryden.

As to the day-to-day inquiries in the business world, I don’t suppose they all call the Financial Post whenever they’re thinking of an acquisition or a sale. But as far as this government is concerned, it has been available for discussions with anybody in the wood industry who has shown concern.

Mr. Speaker: I think that answer is quite adequate.

Mr. Cassidy: Final supplementary: In order to remove the cloud which hangs over the future of the West Patricia tract, will the government exercise its right to terminate the memorandum of understanding after January 1, 1980, and wipe the slate clean, allow the various hearings of the Fahlgren commission and the forest plan due in April 1981 actually to come to pass, and then deal fairly and forthrightly with the decisions about where that timber should go, preferably by ensuring that the timber in the West Patricia is exploited under public ownership to make sure it goes into those areas where it can be most profitably used to create jobs in northwestern Ontario?

Hon. Mr. Auld: I thought for a minute, Mr. Speaker, I had a half-minute answer. I have here a legal opinion from our solicitor -- excuse me, that isn’t the right one.

Mr. Breithaupt: Do you have another opinion?

Hon. Mr. Auld: Not the right opinion but I have the right subject. In essence, I am advised that the memorandum of understanding will not terminate on January 1, 1980, because of a number of steps. Reed made the first step required. Under the old legislation, or lack of it, Reed made an environmental impact study within the 60 days required. That study was not acceptable to the Ministry of the Environment which asked for further information. This has not been forthcoming for some other reasons, and the Ministry of Natural Resources has not carried out the inventory expected.

In other words, I am informed at the moment that there is no legal reason for us to terminate that memorandum of understanding as of January 1.

CORRECTIONAL SERVICES DISPUTE

Mr. Cassidy: I have a question for the Chairman, Management Board of Cabinet, relating to the efforts by the ministry to resolve the current strike of the jail guards across the province, and also related to our hope that the ministry would spend as much effort in trying to avoid or to resolve this strike as are the minister and his colleague, the Attorney General (Mr. McMurtry), spending in trying to stamp down on the workers and on the union leaders involved.

In an effort to resolve this dispute and have the jail guards return to their jobs with dignity, would the ministry consider giving a separate vote on ratification of their contract to the jail guards, or would the ministry consider asking Justice Barry Shapiro, the judge who spent a year and a half investigating the Don Jail and who reported last year, to act as an arbitrator to come back within one or two months and report on the specific question as to whether or not there should be a separate category within which the jail guards would bargain?

Hon. Mr. McCague: The matter raised by the honourable member has not been considered. It is one which, having been advanced by the leader of the third party, the people from my ministry and those of union management might want to discuss during their negotiations.

Mr. Cassidy: Supplementary: Could the minister then acquaint the Legislature with what steps the government now intends to take to resolve the strike, apart from the efforts it is making to force the guards back to work and to put their leadership in jail, which are bound to have a harmful effect on labour-management relations within the prison service for a very long time to come? What steps is the minister taking in order to try to find a satisfactory resolution, after having been so inflexible over a period of five years that the guards have felt they have no other choice than to take a vote to strike, and then to act illegally and go on strike?

Hon. Mr. McCague: I think it is very clear in the statement I made today that there has been a lot of discussion, both through a mediator and through the parties themselves over the weekend, to resolve this matter. As I said, we stand ready at any time to discuss again with union management the impasse we are in at the present time.

Mr. Bradley: Supplementary: In his discussions during the weekend, did the minister pursue the idea of attempting to get from the union an undertaking they would not seek within the next four or five years a further category for negotiating purposes, and in that way have some sort of trade-off that could avoid the unfortunate situation that exists at the present time? If he has not, would the minister consider that proposal in his newest negotiations with the union, whenever they commence?

Hon. Mr. McCague: That is a matter that was advanced prior to the discussions on the weekend. On the one hand, there seems to be favour for doing that; on the other hand, there is a good deal of reluctance. It is very doubtful union management or government could commit each other to something they would not do over a five-year period.

Mr. Cassidy: Mr. Speaker, the minister in his statement today urged the union to follow the system prescribed by law with respect to this particular dispute. Could he tell the Legislature just what the system prescribed by law is when it comes to the union’s getting a separate bargaining category for the jail guards, since this is the only issue, and it is a simple issue, which is in dispute?

When the union presented two bargaining teams at the negotiations, they were effectively not recognized. The union doesn’t have the right to have a separate vote for the jail guards, and it does not have the right to take the matter of a separate bargaining category to arbitration under the Crown Employees Collective Bargaining Act. Given all those facts, will the minister say what is the system prescribed by law for them to raise this matter, since they have been trying to raise it for five years and have been unable to find any means at all of getting meaningful bargaining or any flexibility from this ministry? That’s why we have a strike right now.

[2:45]

Hon. Mr. McCague: Mr. Speaker, I don’t understand how the leader of the third party can say that. We very clearly offered to take this matter to a third party for arbitration.

Mr. Cassidy: You took five years to get to that point.

Hon. Mr. McCague: I think that was very fair. That matter is still on the table.

RAPE CRISIS CENTRES

Mr. Stong: Mr. Speaker, I have a question of the Provincial Secretary for Justice. As a result of his meeting last week with representatives of the rape crisis centre, he knows that 12 of the 15 rape crisis centres in the province are in severe danger of closing within the next six months due to a lack of funding. He knows as well that these volunteer centres already receive community funding which just can’t meet program expenses. Can he give the reasons why his government still refuses to grant funding to these rape crisis centres?

Hon. Mr. Walker: Mr. Speaker, last week I met with individuals representing the coalition of rape crisis centres across Ontario and at that time we discussed the problems involving funding. They made me aware of the crunch they will have in the new year relative to funding. We agreed to render an answer on it in due course.

At that time, it was the first I had been fully apprised of the details of the matter. They appreciated that and they made their presentation. We will be rendering an observation in due course.

I may say that the amount of money requested amounts to fully one third of the budget of the Justice policy secretariat.

Mr. Stong: Mr. Speaker, I wonder if the minister can indicate what he means by “due course.” In arriving at his answer, would he also report to this House whether it is still a policy of St. Joseph’s Hospital and the Queensway Hospital in Toronto to refuse medical examinations for rape victims? When checking with his colleague, the Minister of Health (Mr. Timbrell), would he ascertain if there are other hospitals in the province which also refuse to perform examinations as a matter of administrative practice?

Hon. Mr. Walker: In respect of the last two questions, I will look into those, as requested, and consult with the appropriate people. With respect to the matter of funding, we’ve indicated that an answer will be rendered in time for the conference of the coalition scheduled for January 18, 1980.

Mr. Breaugh: Mr. Speaker, would the minister now give us at least a simple assurance that this government will continue to fund these centres, to see that they do not go out of operation, whether the money comes from his ministry, the Ministry of Health, the Ministry of Community and Social Services, or wherever?

Hon. Mr. Walker: No, Mr. Speaker. That’s precisely what we’re debating over the next while.

AIRCRAFT CONTRACT

Mr. Laughren: Mr. Speaker, I have a question of the Minister of Industry and Tourism dealing with the federal fighter airplane contract, in view of his very strange response on Friday in which he seemed to reverse his position about what benefits will flow to Ontario.

Has the minister been in touch with Jacques DesRoches, the president of the Air Industries Association of Canada, to find out what he meant when he told the Globe and Mail on the weekend. “From what we have seen, nothing is firm and much of what we are being offered we would be getting anyway”?

I want to tell the minister that Mr. DesRoches told my leader this morning that he’s still not satisfied that the commitments are firm, and I would like to ask the minister how he feels about that situation now.

Hon. Mr. Grossman: Mr. Speaker, I can only report again to the House that the federal government has assured us continually and up to date that when the final decision is made, those kinds of commitments that have been talked about and referred to will be firm commitments, of the scale and magnitude we’ve been discussing.

There really isn’t anything to add to that. I would say to the honourable member that he is perhaps being lured in by the heavy advertising campaign that is being conducted by the two competitors, in an attempt by each of those competitors to prove that the commitments and offset offers by their respective opponents don’t quite measure up to what they were said to be.

I can only repeat that notwithstanding that intense competition through the media for that important project, we have up-to-date firm commitments from the federal government that the commitments talked about, offered and understood by us to be there, will in fact be firm commitments.

Mr. Laughren: I wonder if the minister is being sucked in by his federal colleagues.

Could the minister tell us if he got hold of a copy of the confidential document over this past weekend? Does he understand that in that document it’s made quite clear Canada will not gain the capability to do the maintenance on those planes, or to apply the technology to other high technology projects in the future? Is the minister really confident that Ontario industries are going to receive adequate benefits of this new technology when these contracts are finally negotiated?

Hon. Mr. Grossman: I don’t think anything will be served by my repeating the commitments we’ve obtained from the federal government. May I say we do not have a copy of the confidential document. We understand it is being held by the federal government in view of the very technical and important nature of some of the defence aspects that are contained in that confidential document.

If the honourable member has a copy of that confidential document he might be kind enough to send it over to me. If he doesn’t have a copy of that confidential document -- and I know he doesn’t -- then I presume it’s the same source of information that provided his leader with the names of the two foreign competitors for the purchase of Eldorado Nuclear. He knew them so well a month ago but still has failed to send them over to me. I guess it is the same “deep throat” that is sending that information to him.

OPP SERVICES

Mr. G. Taylor: I have a question of the Solicitor General. Last Friday there appeared in the local newspaper in Barrie a statement by Superintendent Burkett of the Ontario Provincial Police detachment. In it he stated he was fighting 1980 crime with a detachment equipped for 1972. He added that the personnel there were overworked and tired, and that he was in need of more OPP officers.

Would the Solicitor General be seeking more personnel for this area so the people of the area, and those visiting the area, could be well served by the Ontario Provincial Police rather than putting up with a 1972 staff quotient?

Hon. Mr. McMurtry: Mr. Speaker, I can’t be specific about the OPP services in that part of the province, but I certainly share the superintendent’s concern generally in relation to the OPP. As a matter of fact, the member was kind enough a moment ago to send me a copy of the clipping, which I passed on to the Treasurer (Mr. F. S. Miller).

HYDRO NUCLEAR PLANT PLANS

Mr. Riddell: The Minister of Energy (Mr. Welch) was in for a brief moment but in the event he is listening outside I’ll put the question to the Premier knowing that he’s always interested in Ontario Hydro’s plans and progress.

I am referring to a letter written by Landawn Shopping Centres Limited located in Toronto. One paragraph of the letter reads: “I am sure you are aware that the Ontario government will soon be starting construction on the Bayfield nuclear power plant which is located 15 miles from Exeter. The Bruce nuclear plant helped spur housing in both Port Elgin and Kincardine to unbelievable proportions -- to the point that Zehr’s put supermarkets in both Port Elgin and Kincardine. Both stores are doing exceptionally well. The Bruce nuclear plant employs 8,000 people, and the Bayfield plant will have am proximately the same number of people.

“The population of Exeter is approximately 4,000 people with” --

Mr. Speaker: “Is the Premier aware ... ”

Mr. Riddell: I put the question at first. Is the Ontario government, along with Ontario Hydro, planning a project we in this Legislature or the citizens of Huron are not aware of? Is there some plan to establish a nuclear power plant in Bayfield in Huron county?

Hon. Mr. Davis: Mr. Speaker, my recollection is that the major undertaking Hydro has underway is Darlington. Bayfield is a delightful community, and I know the honourable member would like to see some growth take place, but to my knowledge it is not being contemplated. I don’t know who wrote that letter, or to whom they wrote it, but to suggest there will be the same sort of growth pattern in that part of the great county of Huron that took place in other parts on the shores of Lake Huron, I think from my understanding would be totally inaccurate.

If the honourable member wants to convey that to the person who wrote the letter I think he is quite free to do so. If he wants to bring them in, as he did some others from Kincardine, to see the economic growth continue in that part of the province, we would be delighted to see them too.

Mr. MacDonald: Mr. Speaker, is the Premier in a position to confirm the energy statement made by his new minister on October 1, that the government is not contemplating any new nuclear generating facilities beyond Darlington in the next 15-year period?

Hon. Mr. Davis: Mr. Speaker, I don’t think I can put the time frame at 15 years, but my recollection is, and the chairman of the select committee is more familiar with the figures than I am, I don’t think they are contemplating another facility beyond Darlington at this moment. In that Darlington is six to seven years away from completion, which brings us up to 1987 or 1990, then we only have a five-year period to bring us up to 15 years; but I am not really prepared to speculate at this moment in time.

Mr. J. Reed: Supplementary: Considering the Premier obviously does not really know the plans at this moment, since his answers are quite vague on this question, would the Premier undertake to make a statement to the House regarding the future growth plans of Ontario Hydro in a clear, concise manner, so we know exactly what is being planned?

Hon. Mr. Davis: Mr. Speaker, I would say to the member for Halton-Burlington that he is on the Hydro select committee, he has been very close to it and he tells his constituents he is the energy expert of Ontario; he probably could make as clear and concise a statement as I could. It wouldn’t be as accurate as any I might make, I doubt how clear it would be, and certainly if it is anything like the rest of the honourable member’s observations it would never be concise. I thought I was very precise in my answer to his colleague from Huron-Middlesex. I don’t know of any planned facility in Bayfield.

AUTO INDUSTRY LAYOFFS

Mr. Cooke: Mr. Speaker, I have a question for the Minister of Industry and Tourism. The minister will no doubt be aware that in addition to the 2,000 people already unemployed on indefinite layoffs at Chrysler, there was a further announcement on Friday of an additional 800 to 1,000 employees who will be on indefinite layoff, along with several thousand other people on temporary layoffs. The minister will no doubt be aware that there are already 1,500 people on layoff at Ford Motor Company in Windsor, as well as many thousands from the parts industries in Windsor.

What is the minister now prepared to do for the people of Windsor, who are experiencing an unemployment rate of around 12 per cent for those who are on indefinite layoffs, and if one includes those on temporary we are talking about 17 or 18 per cent unemployment? What is the minister prepared to do, and is he prepared today to come out publicly and put pressure on the federal government to bring in the transitional assistance benefits for which the United Auto Workers have been asking?

Hon. Mr. Grossman: The TAB program is one which does lie with the federal government, and ultimately the views of this government with regard to that program would obviously be expressed through the Minister of Labour (Mr. Elgie), to whom the member may want to address a question on that count.

My responsibilities, of course, are in terms of the long-term stability of the automotive industry in Windsor and the rest of Ontario. I would be quite happy to talk about that here, as I did in estimates by way of pointing out if it wasn’t for some of the efforts of this government in the last couple of years in that municipality we wouldn’t be seeing the addition of 5,200 jobs, at least, coming on stream in the next couple of years because of the Ford plant. Our continuing efforts have also resulted, in part, in the General Motors expansion which is going on in that city. While we always find it quite easy to talk about the fact we haven’t done as well under the auto pact as we might, the fact is we have two instances of companies, that is GM and Ford, putting great amounts of money into Windsor, which will make sure the short-term difficulties that are currently being experienced in Windsor -- and they are short-term difficulties -- do not become long-term difficulties in that community.

[3:00]

I think we should understand, as I believe the UAW does in Windsor, that the situation we are seeing now is not as severe in terms of percentage layoffs as is being experienced in the United States. That is quite remarkable in view of the fact our Canadian plants generally make larger, less fuel-efficient vehicles than are currently being made in the United States. Notwithstanding that, the layoffs here in percentage terms are not as severe as those being incurred in the United States.

All that having been said, I want to point out to the member that two of the Big Three have recently invested a lot of money in that community. The third is Chrysler, and we have talks going on there now. I have made it quite clear that as far as this government is concerned any assistance given to Chrysler, in any way whatsoever, will have to ensure long-term stability for current jobs and some new jobs in Windsor as well.

All in all, I think we have been spending a good deal of time on the problems in Windsor, in view of North American problems in terms of the sale of automobiles in this period of time.

Mr. Cooke: Supplementary: The minister talks about the 2,800 jobs at Ford: is he aware that Ford has laid off almost that number of employees at its existing plant and that we are expecting that its engine plant could very well be put out of production because it produces the wrong kinds of parts and the wrong kinds of engines? The government put $28 million into a new plant that will really not create new jobs, it will just save some of the jobs that are disappearing because of the poor planning and the way the auto pact is not working in this province.

Mr. Speaker: The question has been asked.

Mr. Cooke: I have a short supplementary in addition to that, Mr. Speaker.

Mr. Speaker: Do you mean a supplementary to the supplementary?

Mr. Cooke: That’s right. I would just like the minister to indicate today if he is still willing to look at a job-creation program for Windsor, as he said he was in a letter to me recently? Is he also willing to go public with the federal government or his Minister of Labour (Mr. Elgie) to get the TAB program in place before it is too late?

Mr. Speaker: You asked that in your original question.

Mr. Cooke: People are losing their homes now.

Mr. Speaker: Does the honourable minister have a short response?

Hon. Mr. Grossman: I should remind the member we understand the extent of the Ford layoffs. The member should be fair and acknowledge this government cannot control the North American demand for automobiles, no matter where they are made. The fall in the market has been marked and has been constant throughout North America, particularly for vehicles made in this country.

The fact is the market is causing the layoffs, not this government, not the American government and not the unions, none of those. The consumer is shifting his and her buying patterns and buying fewer of those vehicles. That is what is causing the problem in the member’s community. I want to make it clear to him that of course we understand the extent of the Ford layoffs; and no, I will not apologize in any way whatsoever for the fact that Ford is laying off people in response to the market at the same time as we are creating new jobs. The fact is no matter which way the member wishes to slice it, if it weren’t for this government there wouldn’t be 5,200 new jobs going into Windsor in the next few years. Those jobs would be lost; they would not be replaced. I hope the member will tell the UAW, when he takes a copy of Hansard back to them to show them his alleged concern for their critical problems, that if we had adopted his party’s policy we would see 2,600 net layoffs, but we wouldn’t see 5,200 new jobs going back into that community solely and totally on account of this government.

Mr. Mancini: I have a supplementary for the Minister of Industry and Tourism. Could the minister inform the House if he has had discussions with other industries outside of the automotive industry that may be planning to go to Windsor so that the industrial base of Windsor and Essex county wouldn’t be so heavily dependent on the automotive industry? I give as a possible example the tomato paste industry.

Hon. Mr. Grossman: Yes.

Mr. Mancini: Is that all the minister is going to say?

Hon. Mr. Grossman: Yes.

Mr. Mancini: Why doesn’t the minister inform the House who he has met with and what --

Hon. Mr. Grossman: Forgive me for saying yes, but we have done it. I know it’s disappointing.

Mr. Mancini: It’s not disappointing; we’d just like to know who the minister has talked to and what their response has been.

RENFREW COUNTY TASK FORCE ON ECONOMIC DEVELOPMENT

Mr. Conway: A new question to the same minister: Having in hand the minister’s long- awaited announcement about the appointment of a new chairman for the Renfrew County Task Force on Economic Development, and recognizing that much time has passed since that particular task force undertook serious and ongoing responsibilities to generate economic activities in my part of eastern Ontario, I am wondering whether or not the minister has called together the new chairman, Mr. Radford, with other members of that task force to make them aware of his own views and those of his government at present with respect to those immediate and intermediate priorities which he and this government see as viable for that particular task force and its responsibilities?

Hon. Mr. Grossman: We will be meeting in the next couple of weeks.

Mr. Conway: Supplementary: Can the minister, in his supplementary answer, indicate to this House what his views are at this point in time about the kinds of priorities he sees as being the immediate possibility with respect to economic development in that particular county? Can he explain to me and other members of this House, why in his announcements he indicated to the people of Renfrew county that of course their development strategy will take many years to be fully implemented since provincial restraint will not allow for the kind of financial resources we believe necessary to get the job done? Can he give this House and the people of Renfrew county --

Mr. Speaker: The question has really been asked.

Mr. Conway: -- an assurance that we will not suffer unduly by virtue of his restraints?

Hon. Mr. Grossman: The answer to the second question is yes, I can give that unequivocal assurance. That is not the tenor, the drift, the tone, insinuation or implication in the press release we issued. To be fair about it, I think the honourable member knows that isn’t the message that was in that press release.

Mr. Radford will be coming in to discuss with us in a general way the kinds of assistance we wish to make available; the extent to which government programs will be tilted in terms of assisting areas such as Renfrew. Indeed, government programs traditionally have been and will continue to be tilted in favour of helping communities such as those in the Ottawa Valley, be they in the tourism sector, that is Timbertown, or in the industrial sector, for example the Westinghouse situation, which I know the honourable member supported even though it was an EDF grant. I know he supported it because it was so important to the Ottawa Valley area.

We will be discussing those kinds of things with Mr. Radford. I want to say that Mr. Radford, as the member knows, has been with the ministry for many years and is well aware of a lot of the programs we have under way and a lot of our strategies. What I don’t want to do is prejudge the outcome of his work, because our strategy is to get local input to decide which kinds of industries are most appropriate for each and every community, which kind will most easily fit into the social and economic climate of each country, which community and which work force can accept which kind of industry, and then operate from that very sensible and measured base. That is what it is all about I think the member would agree that’s a sensible way to approach it.

CORRECTIONAL SERVICES DISPUTE

Mr. Van Horne: Mr. Speaker, I have a point of privilege. On November 29 the Minister of Correctional Services, in response to a question from the member for Brant-Oxford-Norfolk (Mr. Nixon), indicated in so far as the question of problem prisoners being released on an open door policy: “That is not the case, that is just not happening. If it is I would ensure it would stop immediately, but I give the member the assurance it is not happening and that it is not the case.”

I have just been informed that a significant number of people were released from the Elgin-Middlesex Detention Centre. I ask, in light of that information being passed on, if in fact our privileges were not abused by the answer given by the minister last Thursday?

Mr. Speaker: The minister is not here.

There is one minute left in question period.

ALGOMA CHILDREN’S AID SOCIETY

Mr. Wildman: I have a question for the Minister of Community and Social Services. In view of the fact that the apparent inability of the Algoma Children’s Aid Society to fulfil its obligations under the Child Welfare Act has prompted the minister to admit publicly that he cannot guarantee that children there are not at risk; and the foster parents association of Ontario to write him stating that case management appears minimal or non-existent, indeed that children in need are being placed in observation and detention homes normally used for cases of child delinquency; is the minister prepared to exercise his power under section 17 of the act to dissolve the children’s aid society’s board of directors, taking direct control to negotiate a resolution of the current labour dispute?

Hon. Mr. Norton: Dealing with the first part of the preamble to the question, I believe I recall quite vividly the discussion which might have led to the quote to which the honourable member referred. I did not specifically refer to the situation in Algoma, but I did say to the newspaper reporter from Sault Ste. Marie at that time that at no time could I absolutely guarantee, whether a children’s aid society was fully staffed or suffering from a withdrawal of service as a result of a labour dispute, that no child would be at risk. I did assure that person, however, that we were doing everything, in co-operation with the society, to try to ensure that the degree of risk to which any child might be subjected would be minimized during this period.

The answer to the second part, the real question -- am I prepared to exercise the authority under the act and dissolve the board and negotiate directly? -- is no.

PETITION

WASTE SOLVENTS STORAGE

Mr. Swart: Mr. Speaker, I have a petition, addressed to this assembly and signed by 3,503 citizens of the city of Welland. It reads as follows.

“We, the undersigned, beg leave to respectfully petition the Legislative Assembly of the province of Ontario as follows: We strongly object to permission being given by the Minister of the Environment to use the oil tank located adjacent to the old Welland Canal, south of Lincoln Street in the city of Welland, as a storage and transfer station for waste solvents.”

Although the company has now stated it will not proceed due to public opposition, until the permit is surrendered there is no guarantee that it will not proceed.

REPORT

STANDING PROCEDURAL AFFAIRS COMMITTEE

Mr. Breaugh from the standing procedural affairs committee presented the committee’s second report on agencies, boards and commissions and moved its adoption.

Mr. Breaugh: Mr. Speaker, if I might say a few words on this report. It is the second report on agencies, boards and commissions, examination of which has been carried on by the committee. It looks at some six specific agencies of the government and deals in general terms with recommendations put forward by the committee in last year’s report. We would hope the House would now entertain some debate on that, on motion by Mr. Breaugh, the debate was adjourned.

INTRODUCTION OF BILL

TOWN OF COBOURG ACT

Mr. Rowe moved first reading of Bill Pr33, An Act respecting the Town of Cobourg.

Motion agreed to.

ANSWER TO QUESTION ON NOTICE PAPER

Hon. Mr. Wells: Mr. Speaker, before the orders of the day I wish to table the answer to question 337 standing on the Notice Paper. (See appendix, page 5090.)

[3:15]

ORDERS OF THE DAY

House in committee of supply:

ESTIMATES, MINISTRY OF TREASURY AND ECONOMICS (CONTINUED)

Mr. Deputy Chairman: I believe, Mr. Treasurer, that when we adjourned the consideration of the estimates, you were on your feet.

Hon. F. S. Miller: Yes, Mr. Chairman, I was. While I had many more words of wisdom to add to the comments on Friday, I would now like simply to proceed with the first vote and start taking the comments from the opposition, as agreed.

Mr. Peterson: In view of the fact there were no words of wisdom on Friday that I personally recall, or that any others among the great horde of observers who were in this House at the time heard, I would just like to question the Treasurer on that. Further, I also was under the impression the votes would be left to the end, am I not correct?

Hon. F. S. Miller: You are quite correct. I think what the chairman asked the other day is that we consider the first vote and item, that we discuss anything of concern under that vote and item until such time as we must deal with the stacked votes. In other words, for the record, we are on the first vote and item but the discussion, as you agreed, was to be on any part of any vote or item.

Mr. Deputy Chairman: That is pretty well what I said, but also I wanted to point out that we do have roles. The Treasurer and the two financial critics on their own are not in a position to change those rules. The rules do call for us to make progress and to allow other people to speak on these votes.

What I did say is that under main office you can pretty well speak on any vote, but if there are any other members wanting to speak I don’t want to limit their right to do so on any matter they wish to raise under main office. As long as that is understood I think we can proceed.

We will deal with vote 901, item 1, which is main office. Anyone having any questions of the Treasurer in regard to the operation of the main office is now free to put those questions.

On vote 901, ministry administration program; item 1, main office:

Mr. Peterson: While my friend from Nickel Belt is finding his papers and trying to think of something semi-intelligent to say, let me just ask a couple of questions; again I am taking some latitude here.

Could you tell me the status of the Ontario Economic Council? I am not sure if the economic council was a creation of the former Treasurer or not. Certainly he had expressed publicly, not only while he was Treasurer but also after the fact, that he had some very serious reservations about the role of the economic council, even though he appointed one of his very close personal advisers to be chairman. I believe Tom Kierans was appointed by the former Treasurer, was he not?

Hon. F. S. Miller: No.

Mr. Peterson: Then I stand corrected on that.

Hon. F. S. Miller: As I recall, Mr. Reuber was chairman in name when I became Treasurer, but he had given notice that he was going to the Bank of Montreal. I recall one of my first visits was from Mr. Douglas Gibson, a long-standing member of the economic council, who asked me not to leave it in limbo too long. I am guessing, but somewhere around December, maybe even later, of last year, Mr. Kierans was appointed on an acting, part-time basis to be chairman of the council. I am not quite sure of the date, but it followed my appointment as Treasurer, if my recollection is correct, and it was extended later. My deputy confirms that.

Mr. Peterson: I think you are correct and I am incorrect. I apologize on that.

He was appointed acting director. Is he still acting director, or what is his status? What are his obligations and what is he getting paid?

Hon. F. S. Miller: I am going by recollection and will have to check, but the first was six months and then I believe he was appointed for a year at the expiration of the first six months. He has been spending as much time as any director has spent, I am told, working hard at the definition of role and the management of the economic council.

May I suggest, since I have shared some of the concerns the previous Treasurer had, that I sincerely would appreciate comments setting out the member’s point of view right now as to his perception of the role of this economic council. The budget for it is in the range of $1 million to $1.1 million a year. It is a fair amount of the discretionary moneys we have available. I would be very curious to know whether the member thinks it’s worth that as it is presently constructed and functioning, or whether it needs redesign or in his opinion needs to be done away with.

Mr. Peterson: There are a few specific questions I’d like to get out of the way before I do that. What are the director’s responsibilities as the minister sees them? What kind of liaison does the minister have with him as the director? How much time does he put into it and what does the government pay him?

Hon. F. S. Miller: I missed the last point?

Mr. Peterson: How much is he paid?

Hon. F. S. Miller: I would have to double-check the figure he’s paid. It’s $2,000 a month, I’m told.

Mr. Peterson: How many days a week does he work?

Hon. F. S. Miller: I can’t answer that question. I did see a letter from him proposing a reduction in his salary for this coming fiscal year from $2,000 a month to $1,000.

Mr. Peterson: What have yon done with that?

Hon. F. S. Miller: I happen to be reviewing all my personnel spending for next year. Mostly certainly a suggestion like that, let me say, is unique; I haven’t had many people offering to take a cut in salary lately. By the way, his appointment expires on December 19.

I know there are a number of other board members whose terms are up shortly. The most recent correspondence from the chairman outlined the names of those whose terms were up and requested we consider their reappointment and/or replacement, depending upon the person’s own point of view.

The request the chairman made was to reshuffle the $12,000 from his own personal salary to members who would be taking on greater loads within the economic council so that he could more fairly give them duties.

Mr. Peterson: I understand the other members are not paid; only the chairman is paid, plus two or three staff members.

Hon. F. S. Miller: Yes.

Mr. Peterson: By and large that’s a conglomeration, with a couple of notable exceptions, of Tory hacks from across the province.

Hon. F. S. Miller: There are a couple of notable exceptions.

Mr. Peterson: Cliff Pilkey.

Hon. F. S. Miller: I was going to say Mr. Pilkey at least should be identified for the sake of the record, lest he suddenly have a heart attack.

Mr. Peterson: He knows who is buying lunch too, though. He’s fairly sophisticated that way.

Let me talk a little bit about it. I was aware when Mr. Kierans was appointed -- I happen to know Mr. Kierans and I must say at the outset I have an extremely high regard for the man. He has been one of the major players on Bay Street. He’s worked in two or three brokerage firms, always in key roles. As you know, he has changed brokerage firms this last year and is with McLeod’s in a very important role. I don’t question his competence at all.

I think the minister has a very serious problem on his hands though. I’m almost hesitant to say this because I do have a high regard for the guy, but he was, and it is public knowledge, a very close adviser to the former Treasurer and a very close friend. Unless the minister tells me differently, I am also aware of the fact he has come to a number of Progressive Conservative Party planning seminars; I’m not sure about ministry seminars.

He has hd a major role, I gather from what I read in the press or as I recall at least, in advising on when the minister could balance the budget. There has been a great 1984 versus 1981 controversy. I don’t know what the minister’s relationship with him is, but he has been very close to the party. He’s also extremely close to the federal Tories. He was pointed out in a Weekend magazine article recently as a major player, a man of influence with the federal Tories.

I think you really want to ask yourself whether this man should be paid $25,000 a year, $2,000 a month. Certainly when it came out in the press when he was originally appointed that he would be getting $25,000, I was curious, and no one to whom we talked would confirm or deny that at the time. I just accepted that at face value and you have virtually confirmed that.

He obviously does a lot of other things. Two thousand dollars a month may not sound like a lot of money for a full-time job for an obviously very competent human being, but when it comes down to one or two days a week that stacks up to be quite a bit of money, particularly in view of the fact he is very close to advising you.

It is something on which I would like to hear your views; whether in fact this is the appropriate way to run a so-called independent economic council. Granted these things have been bastardized at many levels of political functioning over the years. It’s not as if the chairman of the Ontario Economic Council has always been represented as a true independent. I think Grant Reuber, when he was there, gave the appearance at least of being semi-independent. That, of course, was before he went to the Bank of Montreal, and now has become Deputy Minister of Finance.

The fundamental question is how you view their role and what they should be doing. Do you have any input into their research, what they are doing and how they go about it?

I am interested in hearing your view before I start into my own.

Hon. F. S. Miller: In terms of the kind of person you appoint and the remuneration for the job, first let us compare it with other people in the same kind of category. I am told in the first few months of his appointment he virtually worked full time at the position, particularly as he was looking at the projects and reorganizing it in his mind. I can’t speak with much accuracy about the result of those actions, but if one looks at the rate of pay one pays for people of his calibre, like lawyers who are hired by select committees, lawyers who are hired to look into the police commission’s functions, et cetera, I think you would agree one often sees the fees running between $500 and $1,000 a day.

If, in fact, a lawyer appointed to such a position is worth $750 a day of public money, or even private money because they charge the same regardless of who the client is, I would have to argue we’re talking of a person who brings to the position skills of comparable value.

When one looks at the fact he is from the private sector --

Mr. Peterson: It’s a little different role.

Hon. F. S. Miller: Yes, I recognize that.

Mr. Peterson: He is an administrator here. He is not hired for professional expertise here, he is an administrator.

Hon. F. S. Miller: Hopefully, though, he is more than an administrator. He is like a director of research; while he is administrator he often is also the catalyst, the person who looks at the quality of the input of the researchers. A top director of research has to be an administrator, obviously, but also has to be knowledgeable in the skills of the people working under him.

This is where anyone who has ever had anything to do with Mr. Kierans would have to repeat the very words you used, whether one agrees with his philosophy or disagrees with his philosophy you would have to agree he is also a very bright, competent, hardworking, easy-to-understand person when he starts expressing his points of view. Those qualities are hard to come by in any field, and are perhaps more valued because of that. Persons who can clearly say what they think often win the battle simply because their opponents often can’t say so clearly what they think. Therefore I would suggest we’re getting value for the money.

[3:30]

As to the question of what input I have as the Treasurer, I think if one checks the statutes, the chairman is not really an appointment of the Treasurer but of the Lieutenant Governor in Council. Outside of my being able to give some advice, unlike some appointments it is not, therefore, exclusively in the domain of the Treasurer.

The autonomy of the council has been almost complete, if not complete. In other words, no one comes to me and says, “We are intending to study such and such and so and so.”

I can assure the member that when I was Minister of Health a report was issued on the health-care system by the Ontario Economic Council, that would be about the summer of 1975, and --

Mr. Laughren: There was another one this year.

Hon. F. S. Miller: Yes, there was. I only point out that those reports are the views of the researchers. As with all researchers, one can argue whether they are right or wrong. If you like it, you think they’re great; if you disagree with them, you think they’re wrong. The fact is the council has that kind of autonomy.

I would suspect the choice of topics has been very much that of the chairman and the committee appointed. Within that appointed committee there is an executive committee of some type. The executive committee probably functions more frequently and looks into more detail at the kinds of research being contracted for. If one looks at the budget, I believe a great chunk of the budget is for research contracted with nonpermanent staff or with members of the research community.

The alternative to turning to the business sector, and the one which I believe was followed in the first appointments to the board, has been to go to the academic side and look for people such as Mr. Reuber, who was at the University of Western Ontario when he was chosen. I sense that people who have been chosen for other jobs have come from that general area. Certainly that was the first area to which one thought we should look when Mr. Reuber left a year ago.

I think every so often it’s a refreshing change to have somebody from the business community in that kind of job. Most often their duties prevent them from taking on these duties. In this case we’ve had great co-operation from Mr. Kierans. He has often, in the last few years, almost prejudiced his private interests to be able to offer advice to governments at both levels, as the member has pointed out.

Mr. Peterson: Do his strong, upfront party affiliations worry you?

Hon. F. S. Miller: I think I subscribe to the comments made by Bill Simon in his book, A Time for Truth, where he said one of the greatest mistakes governments can make is subsidizing the opponents of government rather than people who often agree with their points of view.

Mr. Peterson: You sound like Roch LaSalle. He’s the new patronage minister for the federal government.

Hon. F. S. Miller: I don’t mean it quite the way you interpret it.

Mr. Peterson: Then reinterpret it for me.

Hon. F. S. Miller: I see the role of a politician in government, apart from some administrative skill -- which is probably not that great on the political side, people like my deputy have the real skills when it comes to administration -- the real duty I have as a minister, whether it be in Health, Natural Resources or in Treasury, I see as being able to differentiate myself from the member for London Centre or the member for Nickel Belt (Mr. Laughren) in terms of our basic beliefs, our philosophical, political and ideological differences. We’ve gone into this before.

Any time we apologize for our ideological beliefs we’re letting the very system we’re a part of down; therefore I unashamedly stand up and say, as I hope the member does, I’m a capitalist, I believe in the free enterprise system and I’m going to do my darnedest to strengthen it whilst I’m around. It’s been weakened greatly by listening to people from the benches the NDP have occupied over the years, until we have a very hybrid mix going these days; but that’s our fault for being swayed too often by their logic. I do believe, however, that if it’s my duty to see my kind of philosophy imposed upon a government, then I need advice that to some degree corresponds with my philosophy; therefore I don’t see anything inconsistent in having people who are giving me advice, share some common belief with me, and they are most likely to be found within the party I associate with.

Mr. Peterson: Does the minister ask his staff to take out a membership in the Progressive Conservative Party?

Hon. F. S. Miller: Members of my staff are free to do what they want.

Mr. Peterson: Except they won’t last in the job very long if they’re not card carriers, is that what the minister is telling me? All these people are going to feel very insecure. They’re going to start rushing out right now and taking memberships in the Liberal Party.

I won’t enter into a philosophical debate about that at the moment. Let me just go back to Mr. Kierans and say that the Ontario Economic Council is supposed to be in a very special kind of situation. It is unique; it’s not like your deputy or some of these other people who are functioning very close to you on a daily basis. He is supposed to come up with independent criticism, independent research on the state of the provincial economy and how to do various things. You run the risk of having him become an apologist for you if you carry the attitude you have just articulated into that job.

I won’t run along with this any further, but I’m not terribly satisfied with the explanation you have given. Perhaps my friend has something.

Hon. F. S. Miller: May I ask your opinion of the function and role of the council and the necessity for it?

Mr. Peterson: Yes. Mr. McKeough made the statement once, I think publicly and if not, privately, that he had never seen anything of very much value out of the Ontario Economic Council. At least, and perhaps I’m misquoting, he asked, “What have they ever suggested that we followed?” I guess he found them a mite fanciful or a mite out in left field or something or other.

I think there is a role for the economic council. I’m not particularly happy with the membership. I don’t want to be specific about it, but it’s a sinecure for some people I happen to know who haven’t demonstrated all that much except that they were card-carriers. We always go with the tokens, the Cliff Pilkeys of this world, and stick them on there so we can say, “Gee, we’re a broadly-based group”; and Cliff happily accepts that kind of thing.

I would say that generally the membership is not representative of the kind of group it should be, in my judgement, for the kind of independent input into the thought-making process.

The question then becomes, “Okay, what is the role after that board has been established; what they should be doing?” I see a more activist role for that board than they have shown. I think they could be of more help, particularly in the committee process here. Let me give you an example.

The economic council should, as part of their contract, make some of their research and researchers available to select committees functioning on certain matters. Let’s take the Hydro matter. They’ve done certain demographic studies that could have been helpful to the select committee investigating Hydro affairs. Obviously when you’re working with demographers, as when working with actuaries or any other forecasters in any other area, there are a great number of subjective judgements being made. One hopes that the government, or the legislators, will get the benefit of advice from the best, throw it all into the pot and come up with their own conclusions. That is one area where, presumably, if it functions as an independent agency, the council could be of some help in the legislative process. I just pass that on to the minister. He may want to suggest to the council it is an area in which they could be of some use in the legislative process.

I think one of the things that worries me about the economic council is that so much of its effort is just shelved. There is some good research. I looked particularly at some of the research in the pension areas, and I am happy with it. I look at some of the conferences it has run, and I am only sorry they weren’t better attended. The council has held some great regional conferences; and it holds a very interesting conference here once a year which I am I very happy to attend. I learn a lot because world-class minds attend.

Sometimes one wonders what is the purpose of all this, because one has the same people attending all the time, the same interested people. But it is a fairly small group of people and there is the same feeling about the research, that it will go out to the university libraries and it will slip into the shelves there. The few members interested in one part or another will read it but that is it.

There is not the feeling they are elevating the general level of education in the province or contributing in that sense very much to the policy-making process.

I don’t know whether your staff people read those reports, perhaps they do. I have never seen a government response to one of those papers. Perhaps they should be forced to respond. At least we will get the civil service or the decision-makers thinking and give them something to play off against.

I worry that it is just filed, that there isn’t enough done with it and there isn’t very much influence from it. Maybe I am misreading it. If the minister has a different view I would be interested in knowing. I am one who believes that a free society needs independent centres of criticism and research, must constantly be reassessing what it is doing and needs to be constantly pushed and challenged in order to move ahead and make progress.

Referring to the OEC, there are some areas it has chosen for research which I wouldn’t have chosen. On the other hand I think that some of the research it has done is excellent. Those are individual choices, I suppose, and anyone can second-guess some of the topics chosen.

Generally I like it and I think it is worthwhile. Those are a few simple suggestions on how it could make some of its work more relevant and more meaningful, not only to the government but also to the population which supports it and pays its bills.

Hon. F. S. Miller: The reports the honourable member does see are those of hired researchers. They are not necessarily even the views of the council itself, as he knows; such as the one we saw on the question of co-payment or partial payment deterrent fees, if you want to call it that, in the health side.

Do we read them? Of course we do. For example I went through that one quite carefully. I even had a meeting with a member of the council to discuss it --

Mr. Laughren: Who was probably opposed to it.

Hon. F. S. Miller: Yes, as a matter of fact he was.

Mr. Laughren: We are reinforcing each other’s views; that’s great.

Hon. F. S. Miller: I didn’t say that I was. At one time, I happened to be one of the greatest believers in deterrent fees. It was only about 1976, late in the year, that I was converted.

The researchers obviously would have been available to assist committees; however, I think it should be pointed out that those researchers, being contract people, traditionally have been paid for the function of producing reports and therefore probably would be charging a committee for their advice.

Mr. Peterson: Tell them that is part of their obligation.

Hon. F. S. Miller: Well I don’t think we would get a fellow at the University of Toronto necessarily buying that kind of argument. They are in the business of providing and selling their expertise like anybody else. One of the things I think should be said -- I am sure you didn’t say it was otherwise -- but I think it needs to be said clearly; those people who are appointed to the economic council are not paid. I am sure you know that. It is one of the few groups of this nature I have had any dealings with that is so. They are offering it as a public service. I believe they are allowed out-of-pocket expenses and that is all.

[3:45]

Mr. Peterson: The Liberals work for free sometimes, too, you know.

Hon. F. S. Miller: Yes, and in vain. I would also point out to the honourable member that since the council was created we have seen a proliferation of groups in similar roles. We have also seen the 1977 conference on participation or whatever -- I keep forgetting the proper title -- hive off an advisory committee to the Premier made up of representatives of labour, management and the academics.

We have seen the Premier have a business advisory committee, chosen from a cross-section of Ontario industry, meet with him on a regular basis. We have seen the Economic Council of Canada created. We have the C. D. Howe Institute; we have the Conference Board in Canada; we have groups like the Niagara Institute, which may not duplicate but often comes close. One could go down a list of things of this nature, and I guess at a time when we in this House sit looking at the estimates, as we are doing now, wondering how can government spend less money, one has to pose questions such as you pose: Are we getting value for our money, is it time for us to reappraise that?

I would do that almost any year, because my ministry will be under constraints before the next budget. We will be looking for ways to save money; if in fact we think this council is worth the $1.1 million or whatever the cost will be next year, of course, it will continue; if we think it is wasting money, we would hope you would support us if we decided that money was better used within other government priorities.

Mr. Laughren: Just briefly; our caucus met with the Ontario Economic Council some time ago. We expressed some concerns about the kind of research they were doing and talked to them about what we would like to see them do. They seemed to receive our input in a very positive way, but I haven’t seen anything flowing from it.

Obviously the kinds of things which interest us are the issues we raise here in the House, during estimates debates and the budget debate. I am not very happy with a lot of the research either. I think they are missing the whole crisis of the manufacturing sector in Ontario. There needs to be much more thorough research done on that.

I would like to change the subject for a moment, if I could, to go back to the Treasurer’s response on Friday. I really thought I was making it simple by asking the Treasurer some very specific questions, to which he could provide some specific answers rather than engage in a broad-ranging philosophical debate, to which he could just stand up and say, “You are a socialist and I am a free enterpriser.” I would ask him some specific questions and would hope to get some answers.

The responses partly indicate why we are in trouble. You really don’t have a handle on what is going on out there. I will be specific, I don’t want to generalize. I asked you questions about the redeployment problem as a result of the GATT negotiations. You didn’t say a thing about it, virtually nothing at all.

How do you know what is going to happen to Ontario? What are the successor industries that will replace the ones that are gradually phased out? I am not looking for anything dramatic or anything to happen overnight, just some indication that you know what the possibilities are.

There have been studies done that indicate there are going to be problems. I would like to know what negotiations you have had with the federal government. I would like to know what your plans are to retrain some of the older workers who will have to be redeployed. I would like to know just what your figures are in terms of the number of people who will have to be redeployed. Is it the 250,000 the federal government indicated? Who is going to share in the retraining costs? Those are all very specific questions. Is a formula being worked on to share those costs between the provinces and the federal government? We have no idea. We don’t know what you are doing.

When it came to the whole question of auto parts, we have a massive deficit, over $4 billion this year in auto parts. What about the reduction in tariffs from 15 per cent to 9.2 per cent on some of those things? Does that mean there will be more production in the US or not? What are the minister’s long-range projections on deficits in auto parts and on jobs in the auto parts industry? I am thinking particularly now in relation to trade with the United States, not other countries.

I asked you about machinery. We have almost a $4 billion deficit in machinery. I think that’s very serious; that’s a very key industry in an industrialized economy. I don’t know what the minister thinks about that. Does he plan to do anything about it or is he just going to let it drift? It’s getting worse and he sits back and makes no comment on it whatsoever.

Those are very specific questions I asked.

When it comes to resources, is the minister happy with the kind of revenues we are getting from the resource industries in Ontario? He could be, maybe he is. He was Minister of Natural Resources at one time, he knows how little money we are getting from our resources.

This year, Falconbridge Nickel Mines for its first six months had net earnings of $43,550,000. This company is controlled by Superior Oil, a huge transnational. Is he satisfied they should not have to build a refinery in the Sudbury basin? They have been there more than 45 years. What is he aiming for, 50 years? Why shouldn’t they have to build a refinery there? Why should those jobs go to Norway?

Don’t tell us it’s done in order to stabilize the economy of the Sudbury basin. What a sad joke that is. We have been saying for years that it is outrageous that the dangerous work and the dirty work is done in Sudbury, and the wealth creation, in terms of further processing, is done in Norway. Now that’s wrong, that is fundamentally wrong.

I would like to know what the minister is going to do in terms of revenues for the resource sector, and is he going to continue those processing exemptions under section 113 of the Mining Act that he has now given for Falconbridge? Would he allow those to stay in place? If he is, that’s outrageous.

Come to Sudbury and tell us all that despite the $100 million net Falconbridge is going to earn this year, some of it is not going to be plugged back into building a new refinery. Come and tell us that in Sudbury and we will give the minister the kind of reception he deserves.

The minister looks and sees what is happening in Atikokan and Capreol, other parts of northern Ontario that have iron ore mines. While we are importing 58 per cent of iron ore, he is allowing our iron ore mines to be shut down by companies resident elsewhere. Those are the kinds of things bothering us and to which we have a right to an answer.

I’d like to know what the Treasurer’s input is on this famous cabinet committee that’s supposed to look into the problems of one-industry towns. That is part of the responsibility of the Treasurer. He sits back and doesn’t even think it is appropriate to respond to the leadoff questions when they are asked.

I guess the Treasurer would prefer we don’t ask specific questions, that we stand up and engage in the silly philosophical debate which has nothing to do with working people, nothing to do with one-industry communities, nothing to do with people employed in industries threatened as a result of the GATT negotiations. Is that what he prefers? If not, why doesn’t he answer the questions? It has been a week since they were asked and we still don’t have any answers. He has the staff, why aren’t they working on those answers? I would sure like to know the answers to them.

I raised the question of the aerospace industry. We are now getting evidence from all sides, all sources, about the potential problems of the new fighter aircraft contract the federal government is attempting to negotiate. The Minister of Industry and Tourism (Mr. Grossman) sure doesn’t know what is going on He hasn’t even read the confidential document. He is taking the word of the federal government despite all sorts of questions raised about it. I don’t think the Treasurer understands how potentially important that is for jobs in Ontario and for the future of the aerospace industry and for the future of other high-technology industries as spinoff benefits accrue as a result of the work being done in the aerospace industry.

Has the Treasurer made any negotiations with the federal government? Has he been part of it? If so, what are his views about the new fighter aircraft industry?

I asked the Treasurer specifically about the future of de Havilland. I understand why he wouldn’t want to interfere with the privatization plans of the federal government, but at least he could tell us he is sure there will be guarantees given as a result, if and when de Havilland is sold.

An interesting thing happens. The federal government has said there will be no guarantees. The Premier (Mr. Davis) says he’s sure there will be guarantees in the sale of de Havilland. What’s the Treasurer’s views on that? Who is right? The federal government or the Premier? Are there or are there not guarantees in the sale of de Havilland in terms of foreign ownership, in terms of benefits to Ontario?

Has the Treasurer had assurance that any purchaser of de Havilland will be required to proceed with the kind of development work into the new Dash X, as we call it -- it has another number now; I have forgotten what it is; a new 30-seat aircraft. What guarantees is the Treasurer going to insist on that any buyer give us before they are allowed to buy de Havilland? I would like to know the answer to that question.

I asked the Treasurer if he didn’t agree a mining machinery complex in the north would reduce regional disparity. He didn’t even answer that. I asked him if he thought a good mining machinery industry indigenous to Ontario or some place else in Canada would reduce the deficit in a current account. He didn’t answer that question. I asked him if he didn’t think a mining machinery industry here would provide thousands of jobs for Ontario and in some cases in communities where they desperately need them. He didn’t bother answering that question. I asked him if he didn’t think building a good mining machinery industry would reduce the dependence of some communities on resource extraction and he didn’t bother to answer that question.

Those are some of the questions I asked in a very serious way. If the Treasurer wants his estimates to be regarded in a frivolous way, then let him talk to the Liberal Party about it. We are trying to be serious about these estimates and the Treasurer won’t treat them seriously. The Treasurer goes through his ramble, disjointed though it is, and doesn’t deal with the specifics of the problems which we raise in here year after year. It’s discouraging and it’s irresponsible on the part of the Treasurer not to respond to those specific questions.

What does he want us to do, put the questions on the Order Paper in written form and then wait for six months while his staff works through and answers them? We shouldn’t have to do that. That’s what these debates are for.

I am sorry to preach to the Treasurer in such a way but I am very angry at the kind of response he gave on Friday. He didn’t even bother to do any homework at all on the questions that were asked in a very serious way. He obviously regards the estimates debate as something in which he won’t get into trouble anyway, so he will just get up and he will baloney them, to use the polite word. “I will baloney them for a couple of hours and we will get on to other things.” That’s not what we are here for. If the minister wants to demean the whole process of the estimates debate then I guess we can’t stop him, but I want to tell him that that kind of behaviour doesn’t have our approval.

I will sit down now; there are a couple of other topics I want to get into. I ask the Treasurer if he is prepared to answer these questions in a serious way. Would he prefer to wait until Friday to answer them or come back on Monday to answer them? If he had said when he responded on Friday that the member for Nickel Belt asked some interesting questions and that by the time the estimates are finished he would have the answers for him, I would have accepted that. But he doesn’t even do that; he doesn’t give us the courtesy of that kind of response. He just stands up and baloneys for an hour.

So in all seriousness, I ask the Treasurer if he would make a commitment to answer those questions in the same way in which they were asked. I think that’s why we are here.

Hon. F. S. Miller: Mr. Chairman, I started today’s remarks by saying I hadn’t finished my initial comments on Friday by the time one o’clock came and while I should have carried on, I did not. I think the honourable member knew that before the day began and I think the kind of debate we agreed we would have here would let him re-emphasize anything he wished to.

I hope I answered most of the things the Liberal critic covered in his opening comments. Whether I answered them satisfactorily or not, I don’t expect either of you to pat me on the back. The fact is I took quite a bit of time going through, point by point, the matters he brought forward and I was covering a number of yours. I think a check of Hansard will clearly show I mentioned my concern about mining machinery, about the dollar input, the growth of exports relative to imports lately and a few other comments of that nature. I believe Hansard would show that was all said on Friday.

The member says he asks his questions seriously and I, for one, generally try to answer questions that can easily be answered as clearly as possible. The fact remains I found some of his questions a bit difficult to answer -- specifically the question, “Is 250,000 the right number of jobs for re-employment in Ontario?” I don’t know. I don’t know that anybody has done any more than make a rough approximation.

[4:00]

When we look at the potential shifts, we certainly were concerned. As a matter of fact, a year ago last October I took the time to go to Geneva, as part of a trip to Europe, to express my concern to the negotiators for Canada, pointing out there could easily be discerned within Canada a feeling that this was a time to drop tariffs for the benefit of the non-manufacturing provinces at the expense of Ontario. I wanted them to understand this could easily be popular in other parts of Canada but we were concerned that the industrial heart land get the protection it deserved in the discussions that went on.

I don’t know what good option there was to not being a part of the multitrade negotiations. We hadn’t been part of them. I was told the negotiating countries had mechanisms and enforcement procedures that virtually could almost boycott us, which is the word they used overseas.

The fact is we have been suggesting there will have to be skill-training programs through the Employment Development Fund, the Federal Business Development Bank and others. You must admit this year we are embarking upon the analysis and improvement of skill training with a new vigour through the Ministry of Labour, which has accepted the responsibility for that kind of work. There is awareness we have to be changing and improving the skills of Ontario workers so they can adapt to a new world.

We hope Ontario is going to profit to some degree from the new tariffs, once they are pointed out. One point made here is 80 per cent of Canadian exports will enter duty free -- that is to other nations -- and another 15 per cent will be under five per cent. Only 65 per cent of US exports to Canada will enter duty free. In effect, the percentage of Canadian exports going out duty free to other countries is greater than the percentage coming in. We were a very protected area.

You talk about de Havilland Aircraft of Canada Limited. It is great to ask what I am going to demand. It is one of the techniques often used to heap blame upon a government, whether it be provincial, municipal or federal, for something of which it can’t be the complete master. I am very concerned about keeping Canadian ownership of de Havilland. I am very concerned about keeping de Havilland in Ontario. We all must be very concerned about that. It has been a company that has produced one of our outstanding success stories in the export markets.

I am meeting, just by coincidence and not because of the estimates process, with senior executives of de Havilland tomorrow. I believe they are going to talk to me about the Dash 8 or DHC-8 program and I am sure at that time I may have an opportunity to learn what, if anything, is transpiring.

As I understand it, the shares of that company are owned by the government of Canada and the government of Canada will be making any decisions -- if any are ever taken -- to sell it. I surely hope the government of Canada is as interested as I am and as you are in keeping the ownership of that company within Canada and making sure it stays within Ontario; but, most importantly, that it has a secure future. To ask if I am going to demand -- I can demand all I want, but it doesn’t mean that is going to happen. I can request and will request without any question at all, but --

Mr. Makarchuk: When the federal election is on, what will you do then?

Hon. F. S. Miller: I am only pointing out to you what I can do now.

Mr. Laughren: What have you done?

Hon. F. S. Miller: What have I done? I have not been the voice of the government of Ontario in de Havilland. I suspect you will find the Minister of Industry and Tourism and the Premier have been the two who have been talking on that score. I can only tell you we have great pride in that company and because it is so labour intensive, because it is so well specialized in its own field, I would hope there are potential investors within Canada willing to buy it, if it is for sale.

Let’s be honest. You don’t want to see somebody buying it who hasn’t got the foggiest idea of how to run an aircraft company, an aerospace industry. Would you agree with that?

Mr. Laughren: Yes. That is why I wouldn’t sell it.

Hon. F. S. Miller: One would hope potential buyers have both the financial strength and the administrative capabilities to ensure it is a future profitable organization. Let’s be honest. The aerospace industry is a cyclical industry. You have companies like Lockheed getting one of the first, if not the first, major American guarantees to bail it out when the L-1011 program got into trouble. You had the great and almost unassailable Rolls-Royce organization go bankrupt because of its L-1011 engines, did you not?

Mr. Laughren: You missed the point, though.

Hon. F. S. Miller: I don’t think I have missed the point, What I am trying to point out is there have been times when those industries, no matter how welli managed and how well financed, get into trouble. The very reason for Hawker Siddeley, Canada Limited -- who owned de Havilland at one time, did they not? -- getting out of it was that they were at one of the bottom swings and the future didn’t look all that good.

Mr. Laughren: That’s why the government put money in them.

Hon. F. S. Miller: This is one of the times I don’t disagree with you. I happen to think it was a wise move and we did need to maintain within Canada, both at Canadair and at de Havilland a capability in aerospace. It’s one of the reasons I’m in the pulp and paper industry right now, before it goes as far.

When I look across, the member said I didn’t talk much about northern development or the Employment Development Fund. The member implied I should be a bit embarrassed about the Employment Development Fund.

Mr. Laughren: I didn’t say that.

Hon. F. S. Miller: Philosophically embarrassed.

Mr. Laughren: Oh, yes.

Hon. F. S. Miller: I think the member was on the tack that I probably should be a bit embarrassed, and I am. If one goes back into the books he will see I have said that it’s not my favourite kind of thing.

Mr. Laughren: We don’t like seeing you squirm or anything like that

Hon. F. S. Miller: I quite honestly admit when I have problems with a belief, but again I’m a realist, I’m a pragmatist. Eight years in politics, the first of 24, have made me understand -- now that brought him down -- or realize that things aren’t quite as white and black as you and I want them to be. There are times when governments are intervening in the process because of the nature of the marketplace.

Of the $165 million I currently have for the Employment Development Fund this year, the great bulk of it will probably end up going to northern communities and the very kinds of communities the member started talking about, the one-industry communities. That was the very reason that as Minister of Natural Resources, during the time I was looking at the problem of the one-industry community, I wanted to look at not only the ones that were already gone or going, like Atikokan was with its mine and one or two others like Marmora with its mine, but also look a little further down the road.

It’s something the member never gives us credit for doing. We wanted to look across northeastern and northwestern Ontario and find out how many other one-industry towns in the forest products industry were apparently healthy but potentially unhealthy. That was a direct result of the committee the member gives no credit to; I was chairman, as Minister of Natural Resources.

Mr. T. P. Reid: What came out of it?

Hon. F. S. Miller: The member for Rainy River -- I won’t ask him to say he would agree -- believes we should help the pulp and paper industry to restore its strength.

Mr. T. P. Reid: I don’t think we should give them money, but you’re doing it on an ad hoc basis.

Hon. F. S. Miller: No. I don’t think we are.

Mr. T. P. Reid: What are you doing for Ignace?

Mr. Chairman: Order.

Mr. T. P. Reid: Ignace is in the same boat as Atikokan.

Hon. F. S. Miller: The honourable member may be excused for interjecting quickly when he has just arrived.

Mr. T. P. Reid: I’ve been here for an hour and I’m waiting, just like my colleague from Nickel Belt, for you to say something. I was here last Friday --

Mr. Chairman: Order. Order.

Hon. F. S. Miller: I recall many a time when there were three of us in here, but perhaps you were within range --

Mr. T. P. Reid: I was one of them. I was astounded, there were only four of us here.

Hon. F. S. Miller: Five, because it was one of my colleagues who called for a quorum. The fact is that the Employment Development Fund is heavily going after some of the areas you are talking about.

We are working on the auto parts imbalance. Twenty-nine per cent of grants so far have gone to the auto parts industry. That’s a fairly high chunk of the allocation. By the time we’re all through we’re going to be much higher on the pulp and paper side because we’re going to be approving quite a number in the next while, once we have sorted out some of the final details with our colleagues at the DREE level who are paying part of the costs of that program.

That’s an interesting thing. Ontario brought the program forward without consultation with the federal government. We didn’t really ask for help but they very quickly jumped in, I think within two days. Obviously they had been working on it -- they knew we were -- and had a program for Ontario where they gave one dollar for every two Ontario gave. This is specifically for the pulp and paper part.

They expanded it to Quebec, where they gave 60 cents for every 40 cents Quebec gave or $1.50 for every dollar Quebec gave. I wasn’t surprised but I was somewhat disappointed that the ratios were so different in the two provinces. I think our pulp and paper industry is just as deserving of federal dollars as is that of Quebec. I hope you would agree with me. A pulp and paper company functions there with almost exactly the same basic problems it functions with in Ontario, except perhaps they have not pursued the pollution and environmental aspects with the same kind of will we have.

Mr. Samis: That’s not saying much.

Hon. F. S. Miller: I hope to be in your community very shortly and I hope to have you with me while we give away a little money in the next few weeks. The gentleman behind you who suddenly woke up and came alive, in his community we’re giving money away so steadily it’s a wonder we’re not filled with Conservative members from Nickel Belt.

Mr. Laughren: I think the Treasurer is taunting me. I will indeed put the questions on the Order Paper and try to get some answers that way.

Mr. T. P. Reid: That doesn’t work either, I’ve tried it.

Mr. Langhren: At least it puts somebody to work.

I would like to talk to the Treasurer about one of my favourite topics, one about which I have a passion, if not a fetish. That is the whole mining machinery industry to which I have referred a couple of times.

It really is outrageous that this country is the third largest in the production of minerals, the second largest consumer of mining machinery and number one in importing mining machinery. That’s in the developed world.

The jobs that are lost in the mining machinery industry we estimate to be roughly 18,000. To lose 18,000 jobs in an industry which should be ours is simply not acceptable.

I know what the Treasurer has said -- that the Minister of Industry and Tourism had a trade show, which we thought was a good idea, and the Minister of Industry and Tourism has indicated he is going to follow it up. But the Treasurer knows, as we know, that the private sector has had decades to put in place in this province a healthy mining machinery industry and they haven’t done so. There is Jarvis Clark in North Bay, a producer of mining machinery, but they have their problems too. They go to DREE for a grant to expand and they’re turned down because they’re too successful. Now, a fellow named Jarvis and a fellow named Clark own Jarvis Clark -- at least that’s my understanding.

Hon. F. S. Miller: They’re both federal members for our party.

Mr. Laughren: Not the same, no. I don’t think that’s true; I stand to be corrected.

Mr. Peterson: Pretty sure about that; right, Frank? I think they sold out to a US company. They’re now working for the States.

Mr. Laughren: No, I believe the member is wrong because not a month ago they came before the Sudbury 2001 committee, of which I’m an executive member, and made a presentation.

[4:15]

The figure that always fascinates me is the proportion of domestic demand that is met by imports. That’s a very critical figure to look at in any key industrial sector -- the percentage of the domestic demand that is met by imports.

I was checking on mining machinery statistics. These are from the Department of Industry, Trade and Commerce, using the Statistics Canada figures. In 1964, as a percentage of the Canadian market, imports were 57 per cent. That kept creeping up. We have a more up-to-date figure on its way to us; the latest figure we have is that it’s up over 90 per cent. I understand there are some corrections being made on that figure by StatsCan or Industry, Trade and Commerce in Ottawa, but those are the figures we got from them. They’re not our figures.

Thinking of mining machinery imports meeting 90 per cent of the domestic market should cause a chill to run up the Treasurer’s spine. That’s something we have to turn around.

I would like to know if the Treasurer is prepared to move in an aggressive way to ensure that happens. It’s not good enough to stand back with either a wishing wand or a Band-Aid and think the problem is going to be solved. It simply won’t happen that way.

As a matter of fact, James Clark made the point that there should be something called an Ontario mining group in Ontario. He felt the Ontario mining group should consist of manufacturers, government, mining companies, contractors and consultants. The Ontario mining group would take a look at this problem. The government has to take some initiative here. If the Minister of Industry and Tourism won’t take it, the Treasurer should.

I want to tell you something. If I were sitting in the Treasurer’s seat -- we all fantasize, I know -- and I saw those kinds of deficits and import figures, I would say to the Minister of Industry and Tourism: “This has to end. Get together an Ontario mining group; turn this thing around. Don’t do it with a mining trade show that has 10 per cent of the potential market on display. Do a proper one, so we can get this thing under way.”

The Treasurer doesn’t see that as his role. Part of the problem is that he sees himself simply as someone who tries to balance the books. Well, he’s not going to balance the books with that kind of attitude. There’s enough evidence that that won’t solve the problem.

We’ve tried to be very specific on this side in terms of what we would do to try to turn it around. Rather than just criticize what the Treasurer is not doing, we’ve tried to say what we would do. That allows the Treasurer to have a go at us too; we think that’s fair.

We have suggested a number of things. I’ll enumerate them for the Treasurer:

First, we suggest the establishment of an independent nickel institute in the Sudbury basin. We’ve got a university there; that would be an ideal place for it. As a matter of fact, the mineral nickel consultant for the province of Ontario has been urging that this happen for some time now.

Second, we suggest the expansion of Laurentian University and Lakehead University to provide major studies in resource development, as well as extensive mining research facilities. Some of these tie in with the whole question of linkages between the resource industry and the machinery industry. That’s what’s missing at the present time.

Third, there should be government support of mergers and joint ventures that will strengthen domestic machinery production. A good example is the Jarvis Clark operation attempting to expand but needing capital input.

Fourth, we suggest the establishment of a government agency or a government industry agency which would foster communication links between manufacturers, resource companies and parts manufacturers so that domestic companies secure maximum contracts from resource industries. Such an agency would also foster our domestic and international marketing network. The province of Saskatchewan has recently announced such a program.

Fifth, we would put pressure on national distributors to market Canadian-made items.

Sixth, we would require foreign-owned corporations to spend more on research and development in Canada. That’s a major problem.

Seventh, we suggest the introduction of a machinery purchase tax credit program based solely on the buy-Canadian policy.

We have examples over there of the policy which now gives a tax credit for the purchase of machinery no matter where the machinery is purchased. It’s coming back to me now -- the ministry itself had a study out a year or two ago which showed that program was costing Ontario jobs in the short term. In the long term there would be the job creation aspect of it, but in the short term it was costing us jobs. I would even question that. When you encourage the purchase of foreign-owned machinery rather than rebuilding the Canadian machinery you’re not making sense at all.

Eighth, we suggest a manpower training program based on an apprenticeship fund from which corporations could draw after demonstrating an effective program. The fund would be developed on the corporation grant levy system.

Ninth, there should be a strictly enforced buy-Canadian program for government agencies and crown corporations, taking into consideration issues beyond prices. This type of nontariff barrier would respond to those used in all other countries.

I want to talk at some length on that, by the way. I doubt if we will get to it today, but I want to talk about the whole government procurement program of this government. The Treasurer should be taking an active role in that because it has something to do with rebuilding the Ontario economy as well, not just the Ontario economy, but other parts of Canada.

Mr. Peterson: You’ve been reading our stuff, Floyd.

Mr. Laughren: No, this is something we’ve been working at for a long time.

Tenth, we suggest much better data collection on this industry by all levels of government. By that I mean the mining machine industry.

Mr. Chairman, those are some of the things we’d like to see happen in the field of mining machinery. The Treasurer can say they’ve started. Well, they’ve started after years of increasing deficits in the mining machinery industry. As a matter of fact, the figures I was quoting before showed that back in 1964, which is 15 years ago, the trend was already evident. For 15 years the government sat over there and watched the market deteriorate in terms of meeting the domestic demand from Canadian suppliers. After 15 years the Treasurer can say his government is doing something now, but that is not a good enough excuse for not doing anything for 15 years. We’re talking about a $400 million market. It really is a substantial market.

That’s all I have to say about mining machinery. I wanted to talk about one other sector before I sat down, but if the Treasurer wants to respond to mining machinery I’ll stop for a moment and then go on to the other sector.

Hon. F. S. Miller: I was trying to check to see whether the figure you used, that 90 per cent of mining machinery was imported, was accurate. I think when sweeping statements like that are made we need some documentation.

Mr. Laughren: They’re not my figures.

Hon. F. S. Miller: I’m not challenging you and saying it’s wrong. I want to make sure you’re right before I simply take it, as we all too often do, to be gospel. I think I have enough data here.

On a Canadian basis, putting all machinery together -- I leave you to exclude mining machinery -- exports in 1978 were $2.6 billion and export-imports in 1978 were $6.9 billion. So the exports would have been a little more than one third of the imports; about 40 per cent of the imports, roughly.

Mr. Laughren: Then there’s something wrong with your figures.

Hon. F. S. Miller: These are federal Department of Industry, Trade and Commerce figures for machinery in Canada. I can even be more specific in Ontario. These figures didn’t tell you what the domestic demand was. They only showed total exports and total imports. They didn’t say what the Canadian market was and that’s the part I’ve been looking for in my data. So, if you’re right, if we’ve imported $6.9 billion, we’ve offset it with $2.6 billion. The interesting thing there is that the rate of growth of exports is going up faster than the rate of growth of imports. That at least is in the right direction. What would the honourable member have us do? If that isn’t happening, we even have a worse problem.

This is one of those areas where I share again the objectives of the honourable member. I sincerely do share the goal of seeing us improve our Canadian manufacturing of machinery. I am quite willing to consider seriously the suggestions he is making. I am not going to say which ones I will accept or reject today. It happens that when I listened to his first presentation a week ago today I jotted down a number of questions to myself about this issue and I am in the process of asking that we start looking seriously within Treasury at the feasibility of some of them.

That doesn’t mean they are going to be feasible or not feasible. I quite agree it is a major problem and it may be very difficult to solve. Some of the solutions the honourable member has offered may look good, but I will give you one example: the selective sales tax route is, in my opinion, a nontariff barrier. Under the rules of GATT we would be hampered.

Mr. T. P. Reid: Frank, you were complaining that the United States was the worst offender.

Hon. F. S. Miller: I think Japan was the worst offender.

Mr. T. P. Reid: The United States was close.

Hon. F. S. Miller: There are all kinds of nontariff barriers functioning right now; you and I both know it. I have one that is complained about quite often -- the price of wine in Ontario. That is strictly to protect a Canadian industry.

Mr. T. P. Reid: Come on now, 123 per cent? He is raising revenue and you know it.

Mr. Laughren: I will have to get Morty Shulman back here to talk to you about that.

I will leave the mining machinery sector for the moment. The Treasurer said exports were increasing at a faster rate than imports. When one is starting with this incredibly small base, the total deficit is increasing by leaps and bounds, even though exports are growing at a faster rate. That argument makes no sense whatsoever.

Hon. F. S. Miller: Again the insinuation that our base is terrible is not totally correct. Our exports were 38 per cent of our imports in machinery. I don’t think that is quite as infinitesimal as the honourable member has made out.

Mr. Laughren: The minister could go through every figure for exports and imports every year for the last 15 years and it would show him he is wrong.

I would like to go beyond the mining machinery sector and talk about the whole machinery industry in this country. When we talk about machinery we talk about a very key ingredient in our manufacturing base in Canada. In 1975 this country had a $3 billion deficit on machinery; in 1976 it was up to $3.1 billion; in 1977 it was also $3.1 billion; in 1978, $3.34 billion; and so the figures go. This year I expect it is going to be even higher.

The machinery problem goes beyond mining machinery. I didn’t want the Treasurer to think it was only mining machinery with which we had a problem. It is the entire machinery industry that is causing this very serious problem. You could draw two parallel lines on a graph; one would show machinery trade balance and the other would show the manufacturing trade balance. That says something.

[4:30]

The Treasurer was talking about our imports. The figures I have indicate we import 71 per cent of our machinery in this country. This should give the Treasurer pause for thought: we are the only industrialized country in the world that imports more than half its machinery needs. That should tell you something about the way we have been treated by companies which don’t really care about creating a healthy industry in this country and becoming involved in export markets.

That happens when you are a branch-plant operation. The foreign-ownership aspect is important. The machinery industry is foreign owned by 70 per cent of the assets, 50 per cent of the output and 75 per cent of the sales. We know, and I think the Treasurer would admit in a moment of honesty, that foreign ownership has caused this state of affairs. It has promoted fragmentation and excessively large numbers of suppliers for most products, poor design and dismal innovative activity, restricted access to foreign markets for our machinery exports, and imported large amounts of component parts. The Treasurer should understand that.

I will give the Treasurer credit for not standing and saying that is really a federal government responsibility. I suspect he knows we can’t allow ourselves to fall into that trap, because 64 per cent of machinery employment is located in Ontario and 70 per cent of the shipments are accounted for in this province. It is extremely important for Ontario to have a healthy machinery industry. It is an Ontario problem. If it is going to be turned around, it is going to be turned around in Ontario.

I couldn’t help but look at the employment in the industry, and what has happened to employment in the industry in the last few years. I will go through a few figures, just as they apply to Ontario.

In 1972 there were 50,000 employees in the machinery industry in Ontario. By 1978 the number had dropped to 45,700 employees, a drop of almost 5,000 employees in the machinery industry alone. To my mind that is serious.

The Treasurer should not say, “They are becoming more mechanized and more sophisticated and that’s why there is less employment.” The fact is you could also put that on a graph and see that it parallels the increasing deficits in the machinery industry as well. So we have to look at those in a very serious way.

I look at import penetration. The import penetration of the Canadian market in 1970 was 53 per cent. By 1975, it was 63 per cent; in 1977, 65 per cent; and the Conference Board in Canada says it was 70.9 per cent for 1976, even higher than the figures we got from the federal government. I think the matter is serious enough for the Treasurer to go beyond the mining machinery industry.

I agree that you have to start some place. I hope the Treasurer will take a look at the mining machinery and see that as a special case -- a model from which to build -- but have people working on the problem in the machinery industry as a whole, because imports are taking an increasing proportion of the Canadian domestic market.

I look at the trade deficit in the machinery industry and you break it down into component parts. These are the latest figures I have in a breakdown: 1975, construction equipment deficit $545 million; agricultural equipment, $536 million; special plant machinery, $379 million; rolling mill metalwork machinery, machine tooling, $342 million; pumps, compressors, valves and bearings, $304 million.

That all represents machinery in areas of the economy where we are big. We have massive construction programs. We have massive mining operations. We have huge energy projects and they are specifically the areas that use a lot of big machinery. We should be meeting that domestic market, not importing an increasing proportion of it as time goes on.

To break down the individual components into imports as a percentage of the domestic market here are a couple of the bad ones: power generation equipment, 1965, 54 per cent; forestry equipment, 53 per cent; mining machinery, 21.7 per cent; and construction equipment, 16.4 per cent.

I’m sorry, those were domestic, I’ll correct that, Mr. Chairman. Those were domestic shipments as a percentage of the domestic market, not imports. In 1965 in total domestic shipments represented 46 per cent of the domestic market, yet 10 years later in 1975 they had dropped to 37.7 per cent. So in just 10 years they dropped almost 10 per cent. That is very serious.

In the resource-based area it went from 37.6 per cent to 27.3 per cent. In the plant and industrial areas, from 49.4 per cent to 44 per cent; service industries, from 54.3 per cent to 45.6 per cent. That’s how we get the total of 46 per cent and 37.7 per cent 10 years later in 1975.

Those figures substantiate everything we are trying to say to the Treasurer. The situation is deteriorating and for him to stand in his place and say exports are growing at a faster rate than imports is nonsense. The fact is deficits are getting worse and they are getting seriously worse and the imports as a percentage of the domestic market are growing. They are growing very dramatically. The Treasurer can’t pretend it doesn’t exist by using phony comparisons.

If I could I will just give the Treasurer a brief summary of the machinery trade deficit since 1975. The trade deficit in agricultural equipment was $536 million; power generation, $256 million; forestry, $81 million; mining machinery, $136 million; construction equipment, $545 million; special industrial machinery, $378 million; materials handling equipment, $226 million; rolling mill, metal working, $342 million; pumps, compressors, $303 million; other industrial machinery, $103 million; commercial refrigeration, $137 million; and other service industries, $720 million. So we have a trade balance that is unacceptable at almost $4 billion. Between 1975 and 1977, the trade balance went from $3 billion to $3.1 billion and in 1978 it was up to $3.6 billion.

That is a completely unacceptable trade balance. The Treasurer isn’t going to turn it around by pretending it’s not there or thinking that the private sector will solve it, because it is the private sector that let it deteriorate to that level.

I was checking the machinery trade by major machinery-producing countries, because there are people on that side of the House who say, “The low wage rates in the Third World are causing our problem.” That’s nonsense; we are not getting our machinery from the Third World anyway. When it comes to other countries exporting machinery, look where we stand. Percentage of domestic requirements imported: United States, 10 per cent, 10 per cent of their domestic demand is imported; Japan, 10 per cent; West Germany, 34 per cent; Britain, 34 per cent; France, 50 per cent; Sweden, 50 per cent; and Canada 60 per cent.

The percentage of production exported: United States, 17 per cent; Japan, 24 per cent; Britain, 50 per cent; France, 45 per cent; Sweden, 59 per cent; and Canada, at the bottom again, with 30 per cent. So whether we are talking about the percentage of domestic requirements we import or the percentage of the production we export, we are at the bottom of the pile yet again. That is something Ontario is simply going to have to take the lead on.

The size of the market is estimated at about $8.8 billion a year and that’s a big market to have someone else control and it is going to take some very aggressive reaction. The people at the Mining Equipment and Machinery Association of Canada had this to say. Perhaps the Treasurer could pass this on to his close friend and colleague, the Minister of Industry and Tourism. I quote: “Imports substitutions, rather than pushing exports, is a way to reduce the trade deficit and re-establish the industry in a Canadian market.” That was Mr. Meschino of MEMAC.

That’s something the government hasn’t learned yet. How can you expand your exports when you don’t have the domestic industry here to meet even our domestic demands? It’s like playing the old shell game without a pea under them. You think you are going to increase exports when you don’t even have the equipment to meet the domestic demand.

They don’t have a substantial buy-Canadian policy in machinery. If the Treasurer thinks that’s an exaggeration, he hasn’t been following the whole debate over Peel region’s awarding of a contract to Grumman of New York on the waste recovery plant That was a pathetic example of a government not being on top of the whole government procurement. More about that later. I want to talk about that a little later.

We have tried to tell the Treasurer what we would do. One of the things we would do in machinery is put in place, and strictly enforce, a buy-Canadian policy. It’s not there now. This government certainly doesn’t have it.

We would also require the industry to improve manpower training and perhaps we would even set up something like an apprenticeship fund like the one I mentioned for mining machinery.

We could provide capital assistance to enable companies to undertake production of machinery not now made in Canada. For example, I mentioned Jarvis Clark attempting to expand and looking for money -- not free money, but looking for assistance from DREE. They were turned down because they are successful. Perhaps the Treasurer could tell me how we are going to rebuild this sector with that kind of attitude on the part of government.

We think there should be very serious consideration of direct government involvement in certain sectors of the machinery industry. There was an all-party select committee of this Legislature a few years ago. They made the same recommendations. They said that if the private sector continues to neglect the mining machinery industry, for example, government has an obligation not simply to stand back and twiddle its thumbs, but to get directly involved. This is something the Treasurer could do, without compromising any of his free-enterprise ideals. He could make sure there’s better data collection on the whole machinery industry. It’s very difficult to dig out the necessary machinery -- to break it down into the different kinds of machinery and to identify the kind of clusters of imports that occur -- so we know what it is we are fighting and so, when we go to the manufacturers in Ontario, we can say: “This is what we want. This is what we want you to produce in this province or elsewhere in Canada.”

Of course we’d do some of the other things I mentioned, like requiring foreign-owned corporations to spend a lot more on research and development because that has enormous benefits further down the road.

Mr. Chairman, those are some of the things we would do. All I have done is try to impress upon the Treasurer the fact that it’s not simply a mining machinery problem. It’s a machinery problem. The deficits are enormous. They are growing. They are costing us good skilled jobs. We are missing out on high-technology areas by not being involved in the machinery industry in a more substantial way.

It ties in with the whole de Havilland question and what we should be doing there. When you see this kind of thing going on, you think to yourself: “My goodness, if de Havilland goes down the pipe” -- by down the pipe, I mean sold to a foreign company -- “I can just imagine what will happen. I can just imagine it.” The research and development will be done someplace else. The benefits of the high technology will be primarily drained off someplace else. No guarantee of production will remain here, or if it does it will be simply to meet domestic demand, not to into export markets.

The Treasurer has to start making links between what’s happening in the various manufacturing sectors out there. So far, we don’t see any sign of that. We wait with bated breath for his foray into the machinery industry, to try and get us back on the right track.

[4:45]

Hon. F. S. Miller: I noted the exports of mining machinery in Ontario are about 45 per cent of imports. Again, I am not relating that --

Mr. Laughren: A deficit.

Hon. F. S. Miller: The deficit is simple; one deducts the one from the other to get the deficit -- but in terms of the domestic demand and the percentage of it that is local.

One of the encouraging things to me, while we went through the pulp and paper assistance program, was the very high Canadian-procurement content. Most companies were reporting in excess of 80 per cent, with some reporting in excess of 90 per cent of procurement. That, I think, would indicate a fairly healthy and competitive state particularly for the companies producing environmental equipment in Ontario, since a good deal of the money is being invested in that area.

It would also indicate to me there is going to be quite a growth in demand. I think you are going to see well over $1 billion, I would say, invested in the pulp and paper industry in total over the next four to five years. That, in turn, should give a bit of an edge to Canadian producers who are producing, according to our figures as I say, between 80 and 90 per cent of the total expenditure. It is going to increase their output, obviously allow them to expand facilities to meet the demand and, I hope, do some of the R and D required to maintain the product in the forefront. So the program may assist some of the very objectives you are talking about.

You touched upon agricultural equipment. I can recall when this country exported a great deal of agricultural equipment to the States from Toronto and Brantford, in particular, as the two major centres for that production. Certainly that has changed, but I was a bit encouraged to see the reorganization Massey is undergoing right now. It probably will strengthen the Canadian part of it and hopefully see us re-establish some of those points.

You talked about manpower programs and training. Again, I mentioned those, but I think I should repeat that, with the appointment of the commissioner or the gentleman who came from industry to look after this and some of the press reports I saw as recently as today, I am satisfied we are taking the need seriously and are taking steps -- belatedly, if you want to say it, but at least they are being taken -- to ensure we start equipping young Canadians, in fact older Canadians to some degree, for the kinds of jobs that are going to be in demand -- not going to be, it is current.

Mr. Peterson: What are you doing about it?

Hon. F. S. Miller: I think we are progressing very well.

Mr. T. P. Reid: You had the Dymond report six years ago and didn’t do anything with it.

Hon. F. S. Miller: One of the great advantages of sitting over there is one can always say that, can’t one?

The fact remains this is one of the first things we pinpointed during this year as --

Mr. Peterson: We had it pinpointed eight years ago.

Hon. F. S. Miller: If you read through your notes, you fellows can say you pinpointed almost anything because you talk about everything. Therefore, you can be right on almost any topic, no matter what the outcome is, because you have talked on all sides of every issue. Therefore, you are bound to look good if you go back in history.

Mr. T. P. Reid: Mr. Chairman, I just want to deal very briefly with the matter I raised with the Treasurer on Friday, in relation to one-industry towns in northern Ontario and what the Treasurer is going to do about them.

The Treasurer may or may not recall I first had a question on the Order Paper on December 13, 1978, asking how many times the special committee the Premier set up on the one-industry towns in northern Ontario had met and what resolutions and policies they had come to.

I got the usual mish-mash of very little information dealing with the question I put on the Order Paper. My friend from Sudbury East (Mr. Martel) picked up the subject about six months later and then repeated the question I had asked previously. He didn’t get any better an answer than I did, but generally the answer was the cabinet committee on one-industry towns had been folded into the cabinet committee on resource development.

The committee was set up at the time of the Inco layoffs. It was set up as governments of any political stripe are wont to do, namely to indicate that the government is concerned in dealing with it. I didn’t get any answer to my question as to what policies were in place on a broad spectrum and as to what the thrust of the government was going to be in dealing with these situations as they arose in northern Ontario.

It didn’t deal with broadening the economic base of towns like Atikokan, Ignace, Marmora and all the rest of these places. It didn’t deal with what the Treasurer was going to do in regard to the taxation system and so on. We still haven’t heard anything from the cabinet committee on resources development -- and I see the minister who, I believe, heads that committee is here with us -- as to what it is planning on doing.

I asked the Treasurer specifically last Friday about it. I got his usual “jolly old Frank” performance. I want to put the question to him again during his estimates. What can he tell the people we represent who are in these communities that the government is going to do to assist them when the main industry in that town is mined out fully or when all the trees are cut and the mill closes down or whatever? I specifically want to know in the case of Atikokan, for instance, what assistance the Treasurer is going to provide, if any, to that municipality to assist with the tax base or the loss of tax revenues due to the closing down of Steep Rock and Caland? Can the municipality expect any tax relief or assistance?

I wrote the minister and asked him this question nine or 10 months ago. He replied at that time that this had not yet happened and when it happened the government would deal with it. Steep Rock now is closed down completely. They’ve sold all their equipment and machinery. They’ve moved their head office to Toronto to look perhaps into some other investments in the mining field. They’re shut down. Almost 700 men and women were laid off in that community.

Caland Ore has already laid off 200 men and will be laying off more. We had hoped they would be going on until September or October of 1980 but they announced a week ago they would be closing down on April 1, 1980. That will put another 225 to 250 men and women out of work. Some of those people obviously are going to have to leave the community to find employment elsewhere. Unfortunately for them, it’s too late. They’re the recipients of 36 years of this government’s not having any policies in regard to this.

Specifically, I want to know from the Treasurer if he is going to provide anything in the way of tax assistance to Atikokan. This question is going to relate to Ignace, which also has learned in the last two weeks that Mattabi Mines will be finished mining in that area in 1988 and closed down completely by 1990. A large proportion of the people in that community will have to leave to find jobs elsewhere. What is the community going to do to pay for its sewer and water system, its municipal programs and all the rest of it?

I want to ask the specific question, what is the minister going to do as far as the taxes go? Secondly, what can he tell us about the government’s program in regard to one-industry communities, or is he still simply dealing with them on an ad hoc basis? Are there any guidelines or requests they can make that will be available to them to assist them in getting such things as industrial development officers, to whom they can look for government assistance?

Hon. F. S. Miller: Let me address Atikokan directly. There are other aspects to the question raised but, Atikokan being in the member’s riding, I’m sure he’d be interested in the results.

From the regional priority budget: 1978-79, $800,000; 1979-80, $1.4 million; 1980-81, $1 million, in round figures. That’s for a town with 5,000 people. That money is going for sewage facilities, an industrial park, a geological survey, the salary and expenses of an economic development commissioner, and an airport expansion. That’s just one part of it.

The other thing -- and this came directly from my one-industry community committee -- is the grant from the Ministry of Northern Affairs of $75,000 per year for five years for the Atikokan economic development commission. One small company has been secured so far. While it is only employing four people, it is at least a start in that direction.

The Ministry of Northern Affairs is completing final arrangements for a direct grant to Atikokan for the servicing of 12 acres of land to he developed as an industrial park.

The Ministry of Northern Affairs is funding a tourism opportunity study at a cost of $30,000. That is almost complete.

The Ministry of Industry and Tourism has discussed with Norcast Manufacturing, a division of Noranda Mines, the possibility of establishing a facility to produce grinding media. Because of market conditions, that has been put off for a while. Atikokan is still on the short list of places it may go once the economic conditions justify it.

I mentioned the Bending Lake proposal and the roads the other day when the member was here -- in looking to the future in the hope that the Bending Lake proposal would become competitive. We had already got to the point of saying we would, as a matter of subsidy, assist with a slurry pipeline to maintain the town if it should happen. A transitional counsellor has been hired to assist people who are being affected.

While a lot of people disagreed with it, there is no question that the need for employment in the Atikokan area was a basic factor in the decision to maintain the Hydro plant there. If I could get any of these things done for a town in my riding, I would sound like a hero. They’re in your riding.

Mr. T. P. Reid: I’m lucky.

Hon. F. S. Miller: One can go on and ask, “What have we done?” Arrangements are being concluded with the Ministry of Education and with Confederation College to establish a welding course in Atikokan. The Ministry of Northern Affairs is providing financial assistance for the course, planned to take place in 1980.

The Ministry of Northern Affairs is providing money to the Ministry of Natural Resources for a geological mineral survey, such as we did around the Kirkland Lake area. That brought a great deal of excitement and potential development to the area when I released the results a month or so ago.

I mentioned the Bending Lake deal, and I mentioned the expansion of the airport. The member heard us talk about the improvements to Highway 11 and the discussions the minister had before the Northwestern Ontario Chamber of Commerce the other day.

Another little factor, stemming to some degree from our single community report, was the need to put our money into the north and help the one-community towns. The fact is that the regional priorities and community priorities budgets of the Ministry of Northern Affairs will be about $75 million for northern Ontario next year, compared with $4.5 million for all of southern Ontario; that is a 15-to-one ratio, and the population is just about the reverse. On a per capita basis, dollars are being poured into northern Ontario for infrastructure, for development, for all the things we’ve tried to do to make it attractive to industry.

The member heard the figures for other things like Wintario grants to make amenities available: $54 per capita against about $12 to $13 or $14 in southern Ontario. When one gets to the mine sites of Pickle Lake, Ignace, or wherever one may go, one of the major problems is keeping happy employees or happy wives and children. Happy wives and children depend on a community with television, educational outlets and skating rinks. One of the great things about the town of Atikokan is its spirit and the quality of the services it offers people in those areas. For all the problems it faces -- and we are the last to deny it faces problems -- we have been taking active steps in the last while to attempt to do something about it.

[5:00]

The member touched upon Marmora. It’s not in his riding, but he touched upon it. There we had another iron mine go out in advance of its estimated closing time, because Bethlehem Steel in the United States ran into the biggest single first-quarter loss of any company in American history, as I recall; it was around $400 million, or some tremendous figure of that nature. They consolidated right around the world. They didn’t just close one or two Canadian operations; they closed a lot of American ones. That’s happening throughout the American steel industry.

Both the member and I need to worry about the American steel industry, even though the Canadian steel industry is perhaps almost the healthiest in the world, because we do supply the American steel industry with certain components.

Concerning Marmora, we went through a detailed geological survey in eastern Ontario. We suggested the use of the magnetite ore as a heavy aggregate for an improved rail corridor, which has been one of the major issues facing Canada; that is, better transportation. This country, above all, depends on cheap, good, fast transportation in an energy-conscious world.

When I was talking to the member for Nickel Belt (Mr. Laughren), who was complaining about section 113 and the use of Norway for refining, I forgot to say, with great respect, the price advantage of the electricity in that country is something. In fact, I would argue that one should use Canada’s scarce energy resources a little more wisely in some of the areas where one is using them, because of the small differential in manpower involved in the final refining process. I think the member will recall that on average there are seven jobs at our end for every job at the refining end. Does the member recall that?

With alternative sources of nickel ores for refining in the world today -- there was a time when there weren’t -- one of our major jobs should be to protect the jobs in Sudbury. I’m sure the honourable member knows how hard everybody fought to see that those jobs were protected when there was a slump a couple of years ago.

Mr. Laughren: We never supported the exemption. The people in Sudbury didn’t.

Hon. F. S. Miller: I’m not suggesting they did. I’m only saying that when the layoffs occurred in Sudbury two years ago, the pressures on us to do something were such that -- I only say to the member, the most important thing we can do is to get as much processing as we can in this country. That I agree with; there’s no argument.

However, there are some realities in the world that have to be faced. If I had to spend the amount of power that currently is used for that electrolytic refining process in this country, and decide how best it would be used for jobs, I would argue that we could best use it in other ways, and protect the average seven jobs that are at stake.

Mr. Laughren: But they are not using it in other ways.

Hon. F. S. Miller: Just a second; I’m not quite through with the member. I just digress to him for a second, because I missed it in answering him.

Regarding the DREE agreement: We’ve entered into the forestry agreement for northern Ontario to get better access so our timber can be harvested according to age and maturity and so we will have a more logical approach, rather than a from-the-mill- outward approach, to the harvesting of forests.

In the meantime, we got to the point -- and I smile with some degree of credit, because we announced this change in direction in May 1977 -- it came to the point where we were going to unify the control with the companies of harvesting and regeneration. I’m convinced, after listening very carefully -- as I hope both my critics are -- that that is going to improve tremendously the quality of regeneration of the forests in Ontario. That kind of thing has gone on.

As for the specific grant or the maintenance of the community’s tax base, we then leave my ministry’s jurisdiction arid enter into the Ministry of Intergovernmental Affairs’s jurisdiction. That’s the kind of thing the minister would more properly look at than myself. I allocate, through the budgetary process, the total dollars. He makes the specific allocations and decides where special arrangements are required.

Mr. T. P. Reid: I thank the Treasurer for all of that. I appreciate that there has been a fair amount done in regard to Atikokan -- a little late perhaps, but it has been done. The question now is that I have another community, Ignace; and there are going to be a number of communities across northern Ontario that are facing the same things. I’m presuming, from the Treasurer’s answer, that they can expect, perhaps not a Hydro plant, but the same kind of assistance for industrial development officers, for instance -- some of the grants and assistance that the Treasurer has outlined. Can I get a nod from the Treasurer that will be the case?

I appreciate the specifics of what the government has done in Atikokan, albeit rather too late, and I asked the former Treasurer the way I am asking this Treasurer, to have a program to assist these communities. In Atikokan we got going much too late.

Ignace knows that by 1988-90, Lyon Lake-Mattabi is going to be mined out. I don’t want to be here in 10 years anyway --

Hon. F. S. Miller: We can arrange it.

Mr. T. P. Reid: -- but I don’t want to be here standing in this place, or that place, saying, “What are you going to do?” We’ve got to start on it now.

Can I presume, from what the Treasurer is saying that he has a fairly broad policy to deal with these matters, and that the other communities that might find themselves in the same situation can expect relatively the same kind of help?

Hon. F. S. Miller: I would think a good number of the components of the approach to Atikokan would apply to most communities that are facing the predictable end to an ore body. One of the things I’m encouraged about is that while we’ve gone through a period of time where new mines were not exactly being rushed on to the scene, there now appears to be, because of the slight reduction in our taxes for the mining industry a renewed interest in Ontario. My friend and I may agree that will stimulate mining in Ontario --

Mr. T. P. Reid: You won’t get me in on that.

Hon. F. S. Miller: -- when we are dealing with more marginal ore bodies than perhaps were found in some of the socialist states, which for a while were taking 102 per cent of the income.

Mr. Laughren: Like Saskatchewan?

Hon. F. S. Miller: Yes, but let’s be honest. You’ll deal with the devil himself if the ore is good enough, and they had to.

Mr. Laughren: Oh, but they are happy too.

Hon. F. S. Miller: But the ore quality for uranium in the mines in Saskatchewan, I’m told, is exceptionally high. It certainly had the spark and radiance.

Mr. T. P. Reid: I will talk to the Minister of Intergovernmental Affairs (Mr. Wells) about the tax problem and the tax base.

There are two other things I want to speak about to the Treasurer, one of them because he was the Minister of Natural Resources and should have an appreciation, which on occasion he demonstrates. That is, I would hope he might have as big a hammer as his predecessor, Mr. McKeough, in setting government policy along certain lines.

The point is -- and I have said this to the Premier (Mr. Davis), to the Minister of Natural Resources (Mr. Auld), and I’ll say it to the Treasurer -- surely in Ontario, in this day and age, we cannot allow a company like Caland Ore, a subsidiary of Inland Steel of Chicago, to make an announcement that they are going to shut down three or four months early, leave ore in the ground or in stockpiles, shut down their pelletizer and effectively go out of business, leaving mineable, economic ore. They can supposedly mine that ore at a reasonable profit, but they’re going to leave it in the ground or stockpiled at which point it’s not going to be of any particular use to any one. I don’t know how much ore is left in that ore body at Caland. I’ve already asked the Minister of Natural Resources, and I’ve asked the company to provide me with that information. Obviously there is some ore remaining that could be mined, but they’re not going to mine it and they’re not going to pelletize it.

I think those companies have a moral and social obligation to complete the exploitation of ore that can be mined in a safe and reasonably economic way. There isn’t a great deal of ore left in that body that can be got at in economic terms, but there are a few hundred thousand tons; I don’t know how much exactly. It is not going to be mined, it is not going to be economic for Steep Rock, say, to move in there and mine it. They came to that conclusion before. It is not going to be feasible or economic for any other company to come in and mine. Surely, for what is involved, it should be a policy of the Ontario government to say to these companies: “Look, there is very little left; you mine it, you pelletize it and you stockpile it, or you sell it to somebody else, but you don’t leave it in the ground where it is never going to be of any use to anybody.” You give the community and the people at least a few more months grace.

I appreciate the problems of markets and everything else, but surely these companies have to take some of the bad with all the good they have had in the use of that resource. I say to the Treasurer, and I would hope he would agree with me, there should be a policy of this sort by this government, and it should be enunciated now.

For instance, I hope that the Treasurer or the Minister of Natural Resources has been in touch with Inland Steel and brought to bear all the moral persuasion at least -- if the government is not prepared to do it legislatively -- to ensure they carry out that mining to the very end of the ore body that is there.

Hon. F. S. Miller: Knowing and respecting the intelligence of my colleague, he realizes the complexity of the issue. Companies are made up of managers who have a very real social conscience, even if we like to paint them otherwise.

I met, and the honourable member met, the manager of that company. I believe he was down with the group talking about the future of his community the other day. They live with human beings who work with them, and they form the same kinds of relationships we do. Yet we have seen a number of communities throughout Ontario, almost all with iron mines in the last while, face that kind of matter where a mine has been left.

It is not just a question asked here. In the United States at this time there are steel producers closing down in a whole raft of places. A good deal of that is because the steel industry in the United States is not as efficient as the steel industry of Canada or the steel industry of Japan, in particular, and to some degree that of Germany. I won’t get into the reasons for it; interestingly enough, a part of it is because it is the oldest. The parallel in Canada was the pulp and paper industry. Our pulp and paper industry was there first; therefore, when it came time to get into a tough market, people with new mills, like those in the southern United States, obviously had the advantage of better technology than we did.

The Americans were there first with their steel mills. They didn’t go through a war that saw a good number of their plants obliterated. They ended up, therefore with more antiquated mills than some of the competitors who started, almost from scratch, after a war or as their countries developed.

Mr. Peterson: Where did you acquire this global view? They really have cleaned up the kid from Bracebridge.

Hon. F. S. Miller: Yes, they have. My friend forgets my engineering background starts coming through once in a while.

Mr. Peterson: I liked you better when you were turning back odometers.

Hon. F. S. Miller: I called them speedometers. An odometer, I thought, was something dealt with on those television commercials.

[5:15]

What I am trying to say is that when a company stops taking out a resource such as ore, it is generally because market conditions have forced that. The idea that we can somehow force them to produce it at a loss is not realistic.

We tried quite hard with Marmora, because the ground conditions were almost exactly what the member was describing. It was a predictable end but it came perhaps a year or a year and a half in advance of the predictable end of commercial grade ore. There was a cessation of activities because of lack of demand for the particular ore by the first pelletizing plant ever made in North America to produce a pellet that was only made for a specific plant and no longer needed there.

We tried the product in two or three other mills, but it wouldn’t work. The cost of making the pelletizing equipment adaptable to other companies’ mills was prohibitive. We simply couldn’t do it. Therefore, we had a company maintain a pelletizing operation for a period of time, knowing full well they would never use the pellets, to try to keep their men working until such time as the mandatory time periods ran through. They could have paid them and told them to go home, but they at least brought the stuff up and went through the motions.

Funnily enough, I recall very clearly the day the people from Marmora came in to talk to the committee. I remember the chief of the union saying: “If you expect me to come here and run down the company I have worked for the last 35 years, you are totally wrong. I will say to them that they treated us fairly. They can leave this community with their heads high. They have left most of the workers in a fair position.” For a man heading a union facing a plant closure, I thought that was as genuine and straightforward a statement as I had ever heard. Some members may have been there the day he said that. It was kind of a man-bites-dog comment, because in this world, where we are so used to management and labour traditionally saying each other is totally incompetent, it was a rare display of unanimity and realization that the company had done all it could.

I don’t know what applied in Caland. I would like to hear more of the details. I am sure my colleague the Minister of Natural Resources is aware as to whether Caland has or has not acted as a good corporate citizen or taken the shortest possible route out. That is the kind of thing one needs to know before one comes down in judgement on them. I would assume the member knows whether they have or haven’t been, and perhaps he could enlighten me.

Mr. T. P. Reid: I won’t spend too much more of the Treasurer’s time, but I will say that Nat Scott, the manager, and the management generally of that company have been very good and very community-minded. They have done their best to ensure that the mine operates as long as possible. They are very concerned and always have been. They are very involved in the community, as the Treasurer says, it is very unfortunate this has happened but the problem is that it is not their decision. Their own press release indicated the decision was made in Chicago.

I really believe there is a difference between a mine shutting down or an industry shutting down for a while because of lack of demand and then being in a position to be able to start again when demand comes back or the economy comes back. But we are not dealing with a simple case of demand rising and falling, a fluctuation. We are talking about the ordinary business cycle. We are talking about something going out of business and out of operation prematurely and never coming back into business in the future, because what is going to be there is not going to be economic for anybody to mine. I see a very distinct difference there. However, we will wait and see what the Minister of Natural Resources says in regard to what ore is there.

I want to leave one other thought with the Treasurer because of his stint as Minister of Natural Resources, because of his position as Treasurer and because of his own personal interest -- perhaps hobby now, if nothing else -- in the tourist business in the Muskokas.

I find it absolutely ludicrous and fatuous that his colleague the Minister of Industry and Tourism (Mr. Grossman) should get up in this Legislature and go around the province -- he was in Sault Ste. Marie last week -- handing out Ontario taxpayers’ money to the tourist industry, saying, “Expand your facilities; build new plants; build new swimming pools; tennis courts; build new lodges for fishing and hunting,” when, at the same time, that government over there allows complete and free access to crown lands in Ontario, for up to 21 days, to anybody who comes across the border.

The situation is simply this: People from Chicago or Wisconsin or, if one likes, Germany -- I think somebody mentioned we were trying to get people from Europe -- can come here and buy a fishing licence, or maybe a hunting licence. They don’t even have to do that if they don’t bother fishing. They can camp on crown land anywhere in northern Ontario for nothing, for free.

My friend from London Centre (Mr. Peterson) can put a $1-million lodge on a beautiful lake -- on what likely the Treasurer has -- and 10 American campers can park right on his boundary line, if it’s crown land, set up their tents or trailers and squat there for 21 days at no cost to themselves. It’s crazy; it would be absolutely nuts to compete with that kind of thing.

The minister doesn’t have that problem in Muskoka, because there is hardly any crown land around there. He has all the goodies he bought a long time ago, all the good crown land. But in northern Ontario --

Hon. F. S. Miller: Ninety-six per cent is mine; four per cent is crown land.

Mr. T. P. Reid: And 96 per cent of the minister’s is probably 98 per cent of the bank’s, but we won’t go into that.

The point is simply this: I cannot understand why we in Ontario are giving away one of the greatest resources we have, the thing that attracts people to our province. The reason for the tourist business, the reason we spend millions of dollars advertising, is to get tourists here and then to part them with as much of that green stuff as possible.

Hon. F. S. Miller: Never would have thought it.

Mr. T. P. Reid: Well, I think the minister is pretty handy at doing that from what I understand.

The point is simply this: We have these natural resources that we are giving away. Would the minister not agree with me that it makes economic sense, as well as good sense from the point of view of conservation of our resources, that foreign tourists to Ontario be required to stay at licensed tourist resorts, at motels, at hotels, at licensed tourist parks or at provincial parks? Then we are extracting the maximum amount of dollars from them. I mean, it’s ridiculous otherwise. There are very few jurisdictions in the United States where people can take their camper trailer, their boat and motor, just pull up anywhere, throw in their boat, fish all they want, camp on the shore and have a lively time without somebody saying, “Excuse me, but there is a $5 or a $10 charge,” or whatever it happens to be.

We have been giving this away for years. When are we going to stop? The minister well knows that tourism is our second largest business. Imagine what it would be like if we weren’t in competition or if in northern Ontario the people in the business weren’t in competition with the Ontario government, which is providing this for nothing.

I am sure the Treasurer is interested in saving money. For the amount of garbage left in the bush -- and I don’t blame only the tourists -- we are spending, if I recall the figures, $5 million a year, or some ridiculous figure, on picking up garbage in the bush.

We could save on conservation measures, because the way it is now, northern Ontario is two thirds the size of the province, but we have one conservation officer for about every 100 square miles, and that’s being very generous. So they can’t possibly control fishing limits, illegal hunting and all the rest of it. It is the bread and butter of the tourist industry in northern Ontario. If they were required to stay in licensed premises of some kind, the conservation officers could make swings around those places and check their catch or their bag of game to see what they have. Surely that makes sense.

NOTOA passed a resolution, last year, I believe -- I think it was their second or third major resolution dealing with the use of crown land. I cannot fathom why the government refuses to deal with it. I would think that the Treasurer, because of the business he’s in, would see the validity of it. I would think the Treasurer could also see the somewhat hypocritical stance of the government’s saying, “Invest in the tourist business,” when it is running a free show next door. It just doesn’t make sense. I put that to the Treasurer. Perhaps he would like to comment on that.

Hon. F. S. Miller: It’s a discussion that’s much easier to have than to solve. It was a topic of great interest at each NOTOA meeting I attended. The NOTOA people don’t make the differentiation most days of the week between Americans and Canadians using crown land. The access to crown land is so easy, and for Canadians it is taken as a right. I am not about to argue whether it is or isn’t a right. In fact, the policing of it is a monstrous task. You could have conservation officers almost equal to the number of tourists, and you wouldn’t necessarily prevent it.

The honourable member knows they have been working hard, attempting to get access points to crown land and attempting to bring some order. I have always argued that a good many of the kinds of facilities provided by the NOTOA operators simply aren’t competing with anyone who wants to rough it. Most of the NOTOA operators are providing comfort as well as a location, in many cases, on crown land. I think the member would have to agree that a great many NOTOA operators are on leased crown land throughout northwestern Ontario.

Mr. T. P. Reid: What does that have to do with it?

Hon. F. S. Miller: Well, it is a use of crown land.

Mr. T. P. Reid: I am not saying nobody should use it.

Hon. F. S. Miller: No. It’s an extremely difficult thing to control. Incidentally, I get letters very often. I don’t recall ever getting any from the honourable member when I was Minister of Natural Resources, but that doesn’t mean I didn’t.

I am arguing the other side of the coin. They would argue vehemently that the Ministry of Natural Resources is removing an illegal occupation of crown land -- somebody’s hunt camp, or somebody’s cabin. The member for Nickel Belt (Mr. Laughren) has run into these, without question. They have argued that we have prevented fly-in operators from having a site because somebody else has the site on the lake.

I would say 85 per cent of the stuff that reached my desk was not arguing that there was too easy access, but that we were prohibiting or attempting to manage access. I tell the honourable member, the chaps in Natural Resources would dearly love to have that problem solved. It is probably something that the Minister of Natural Resources must argue.

I will say one thing, and this will probably raise the ire of both honourable members, although I hope only of one. The first thing I did when I became Minister of Natural Resources was raise the amount the province charged for its own camp sites. The reason I did that is based on the very argument the member is putting. Why would a private operator provide the camp sites -- they outnumber ours about three to one, I think -- that are needed in Ontario if the Ontario government is running them at 50 per cent of his cost?

Mr. T. P. Reid: The logical extension is to do away with the free use of crown land.

Hon. F. S Miller: I don’t really disagree with the member. I simply tell him that no one has found a way to do it.

[5:30]

Mr. Laughren: Mr. Chairman, I would like to talk to the Treasurer about a matter which I briefly referred to before, namely, the whole government procurement program for Ontario. I hope the Treasurer will see it not in the way the Minister of Industry and Tourism saw it in his estimates when I raised it with him a week or so ago. He seemed to think the purpose of the government procurement program was to cost the taxpayers more money in the purchase of goods governments bought. What an outrageous assumption and argument for him to have used.

I am hoping the Treasurer understands a government procurement program has a much broader goal than that. It is part of a package of industrial strategy -- and I am sorry, that is the first time I have used that phrase since the estimates started. It is part of an industrial strategy to rebuild particular sectors and to encourage Canadian industry. The government policy in Ontario is lacking. Indeed, it is very sad.

I was doing some background work on government procurement and some of the policies one can implement and I came across a report prepared for the department of communications, national telecommunications branch, industrial resources division of the Department of Industry, Trade and Commerce and for the Ministry of State for Science and Technology. This is dated June 1978. The purpose of the report is “an economic justification for payment of a procurement premium.” That study selected a particular sector, if the Treasurer isn’t aware of it, and they picked communications equipment. This is what they said in their executive summary:

“In this study, the objective is to encourage Canadian domestic industry and the method is to purchase its products even though the prices may be higher than those of imported products. The study focuses on the extent to which the government is justified, on economic grounds, in paying a higher price for a Canadian-produced commodity. More particularly, the study develops a method of computing just how much extra the government should be willing to pay for a Canadian commodity. This is based on identification of and, as far as possible, quantification of the benefits and costs associated with such a purchase under current economic conditions.”

They use communications equipment partly because it is an advanced technology and there is a high degree of labour content in it as well. That was the sector they picked. They concluded that if all of the ingredients were there, everything fit in -- a high degree of labour content, a high technology component, a regional aspect, everything that would benefit the country -- that the government could actually provide a 76 per cent advantage, or pay 76 per cent more for a Canadian product and still have net benefits to Canada.

Nobody is saying to the Treasurer that means we have a procurement policy that goes from the present 10 per cent level up to 76 per cent. That is not what I am saying. I am saying the present procurement policy of the Ontario government is inadequate and 10 per cent is simply not a figure you can justify.

They go further to say in their conclusions:

“Current procurement policies and practices of the Canadian government were presented and the domestic practices were demonstrably more open than foreign ones. Since domestic businessmen are thwarted when they try to sell in foreign markets, they begin to question why foreign suppliers have relatively free access here.

“Although the current 10 per cent premium appears to be ineffective in changing purchases from foreign to domestic sources, it has some public relations value. The figure of 10 per cent appears to have been arbitrarily chosen so we were drawn to making a better estimate of a premium justified on economic grounds which might be more effective.”

What they are saying is the 10 per cent level is arbitrary and it is not a sophisticated analysis of what a good procurement policy is all about.

I go on and I quote: “The premium is justified using a benefit-cost approach. The general component based on taking up slack in the economy is applicable to the whole class of communications procurements. This general premium was evaluated at 76 per cent of the import or duty-free price in the case of a straight choice between a domestic and an imported good and expression for the percentage premium was obtained which permitted selection when faced with many different goods with different fractions of domestic content.”

I only raise that study with the Treasurer to indicate to him the present procurement policy is not something this government should hang its hat on. There is nothing magical about the 10 per cent figure. It is just an arbitrary figure, just as any other figure would be an arbitrary one. I would like to raise a couple of specific issues. One we’ve been through a number of times in this chamber. When the Peel region put out tenders for a waste recovery plant, the only bidder was Grumman Ecosystems of New York. Three Canadian companies could have bid on that but didn’t. The reason they didn’t was the particularly difficult specifications and so forth. They felt they were behind the eightball to start.

Even though the Ministry of the Environment is putting $10 million into this project, the government sat back and watched this happen. It didn’t go to the industry, select the three companies that were capable of working on this and say to them: “We’ll work with you. We’ll form a consortium with you and help you prepare a bid for this project”

Waste recovery is a natural for the future. It’s high technology; it’s something that is not in place in this country, let alone the province. It would have given the domestic industry a foothold in that very important industry for the future, but the government sat back and did absolutely nothing. Despite all sorts of proddings from this side of the House, it did absolutely nothing. That’s intolerable.

The other issue I’d like to raise has also been raised in this House. It has to do with Microfilm Recording Company Limited, MRC for short. It’s a company that produces microfilm readers. Established in 1949, they now employ 22 people in the plant and eight in putting documents on microfilm. The research and development for the product is done here. Aluminum is the key material and that is purchased from Alcan. The lens is bought in Japan but the other component parts are supplied from Canadian firms. They manufacture 6,000 readers a year.

To give you an example of what can happen with a Canadian company like that, last year they learned that the John Deere company in the United States was going to make a large order for Bell and Howell microfilm readers. It was for about 2,500 readers. The company in the States had decided to buy an extra 800 from the John Deere subsidiary here in Canada.

MRC talked to the Canadian subsidiary of John Deere and showed them they could save $90,000 if they bought from MRC here in Ontario, and they did. But do you see the problem? It’s a beautiful example of what happens in a branch plant economy, which is a problem that the Treasurer chooses to ignore. They simply are an extension of policies there. That’s one side of the problem.

MRC found out the federal government buys a couple of thousand of these readers every year. Last year, according to them, the federal government spent $998,000 on readers of which MRC, the only Canadian producer, received orders worth $175. Last fall they sent a letter to the federal government and to the provincial government trying to get a response from them.

Actually, they were quite pleased with the initial response from this government. They were given someone to contact in each of the ministries in Ontario. MRC wrote a letter to each one of them. Do you know what? They received no acknowledgement from the individual ministries. In 1978, they bid on tenders put out by the Ministry of Transportation and Communications and the Ministry of Revenue. They lost the bids.

They could live with losing a bid but they didn’t even get the courtesy of a letter giving a reason why they had lost the bid. Nobody even bothered to tell them, “We’re sorry you lost it.” They had to phone in for the results of the tender. You knowwhat they were told? They were told, though not in writing, they were turned down because the company was unknown. Isn’t that great? Isn’t that a great procurement policy for the Ontario government? That’s not how you rebuild the manufacturing sector in this country. Anyway, the problem is the Ontario government has a tendering policy that’s unacceptable. It has a tendering list. If you’re not on that list, that’s too bad.

Hon. F. S. Miller: That is not so.

Mr. Langhren: That’s exactly what happened. They’re not on the tendering list because they’re unknown.

I would like to know how you become known. They got on two of the tendering lists; they got on the Treasury’s and Attorney General’s. I’ve made the Treasurer’s day, he didn’t even know that, but they’re on the list.

The trouble is that when the tenders go out, do you know what they say? There’s one from the Ministry of the Environment; it is on the call for tenders, I quote: “To provide price and delivery for equipment as follows, or similar substitute, Bell and Howell computer microfiche reader.” Well, there you are. Would the Treasurer tell us what he thinks about using as the example a Bell and Howell reader, rather than one made here in Canada?

Here is another one, Government Services; the call for tender for three microfiche readers and these are the specs: “Electrical standard 120 volt 50/60 cycle AC, Micron 78 microfiche reader or approved equivalent.” That’s an American manufactured reader used as a model again; so guess who has the inside track? The one that is listed, obviously.

Here’s another one: “Micron 785 microfiche reader, or approved equivalent.” These are actual quotations from the ministries over there. It has been raised in this chamber and you never do anything about it. You tell me how that makes sense as a government procurement policy when, first of all, you don’t put the Canadian company on the tendering list, the automatic blanket or tendering lists; and second, you allow your own ministries to use a foreign produced or manufactured product as the standard by which all others are measured. What kind of procurement policy is that?

It’s bad enough that your 10 per cent policy isn’t working, it’s worse when you exacerbate the problem. So I would sure like to hear the Treasurer’s response on those two examples: the Peel region waste recovery plant and on the Microfilm Recording Company’s attempts to sell to its own government.

Hon. F. S. Miller: On the Peel region, I am not qualified to give you an answer. I understood we discussed it already in these estimates. The Minister of the Environment did answer your question; I think I should leave the answer with him.

On the other matter I have no idea what the other side of the story is. If the facts are as you stated, obviously some effort needs to be taken on our part to make sure the Canadian company is named and is accepted. I will be glad to have my colleagues check on that to see whether we can’t help.

We have been doing just the opposite, where it came to trying to get acceptance of Canadian companies through the EDF program. I know for a fact MIT has worked very hard to make sure that if a part or a piece of machinery was available within Canada, unknown to the potential buyer, at least they acted as a broker for bringing the companies together so the sales people for the Canadian vendor would have a chance to display their equipment.

Over the years I acted as a salesman, very often I ran into specifications that frustrated me. It’s easy to say they have some international intrigue. Most of the times I found there was better salesmanship. I hate to admit it.

When I sold paints I was forever running into one company, specified by almost every architect in this province. I would go in with my company that had been Canadian, in Brantford, since time began and they would say, “We know this company. They call on us regularly. We’ve got their colour codes, we’ve got their books, we know what they mean when they say this and we know what they mean when they say that.”

So I have to admit that’s one company -- and it always said “so-and-so or equivalent” -- that had done an excellent sales job. It was an American company, although every bit of the product that was used here was made in Canada. As I recall, we import virtually no paint across the border. We export a wee bit, but we don’t import an awful lot into Canada, if my stats are right, simply because it’s a product that doesn’t justify transporting too far and is relatively easily made.

[5:45]

Now that I’m no longer in the paint business --

Mr. Laughren: You painted used cars?

Hon. F. S. Miller: I painted used cars, yes.

Mr. Worton: I bet you could sell it now, Frank.

Hon. F. S. Miller: I could sell it now, from my new position.

I would have to say that while I chewed away at the company and wondered why they got all the business, they were probably doing a better job than I was and I hated to admit it as long as I was out there.

Mr. Laughren: Has the minister missed the point entirely on what I’m trying to say to him?

Hon. F. S. Miller: I’m a bit thick.

Mr. Laughren: No, no. I didn’t say you were thick. I said I think you missed the point. Why you missed the point is maybe because you’re thick, but I didn’t say that.

The point is, only his ministry and the Attorney General’s have put this company on its tender blanket list. Nobody else has.

Hon. F. S. Miller: I told you I’m going to check. I’m going to check.

Mr. Laughren: I didn’t hear him say that.

Hon. F. S. Miller: That’s because you’re a bit thick.

Mr. Conway: I understand these estimates are being dealt with in a more or less general fashion.

Hon. F. S. Miller: Gentlemanly too up until now.

Mr. Conway: And in a gentlemanly fashion. I thought I would accept the invitation of my friend from London Centre to make a few general observations about the economic policies of the government.

Hon. F. S. Miller: Stop at two minutes to six. I have a dinner in Ottawa.

Mr. Conway: I would be happy to stop at two minutes to six.

Hon. F. S. Miller: I have to be in Ottawa.

Mr. Conway: You’re due in Ottawa, are you?

Hon. F. S. Miller: I’m due in Ottawa for supper.

Mr. Conway: That’s perhaps a good point at which to begin my remarks because it is the Ottawa connection that is of some interest to me with respect to the economic policy of this government. With 10 or so minutes I shall try to say a few things in the federal-provincial area with respect to economic policy and make one or two comments on the eastern Ontario situation.

I must say, as a private member I have been somewhat dismayed to receive so little mail by way of press releases and speech-giving from the incumbent of the Treasurer’s chair relative to what we were accustomed to in the halcyon days of the Duke of Kent.

Mr. Laughren: Are you complaining about it?

Mr. Conway: I’m complaining, yes, because I used to read --

Hon. F. S. Miller: That’s because I give speeches without a script.

Mr. Conway: I can tell the Treasurer that I, for one, as a nonfinancial person, used to read the utterances of the previous Treasurer, such as they were, with a great deal of interest. My involvement with health matters really made me more interested than I had been earlier. I was somewhat chagrined to find so little in my mail box from this Treasurer. It may be he speaks off the cuff and with much less preparation than did his predecessor.

I was talking to a friend of mine who works in the federal administration in Ottawa not too long ago and she said, as only an economist can say about these matters, it was really interesting now working for Sinclair Stevens because one got the distinct impression that Ontario counted for ever so much less. She said, “When Darcy used to come to town we had a feeling that next to the federal Minister of Finance, the Ontario Treasurer counted” -- as my leader has said repeatedly -- “as the second most important financial spokesman in the country.” From where I sit, that certainly seems to be the case in so far as this Treasurer has not undertaken to maintain the same kind of profile and the same kind of leadership position his immediate predecessor seems to enjoy.

In that connection, I must say it disturbs me no little bit to see Ontario’s position in the general leadership of economic and financial policy in the state it is today. I did, as I know many members did, watch the first ministers’ conference of some days ago when the oil pricing question was being discussed. I was alarmed to see the results of that particular negotiation.

I just want to say one thing to the Treasurer, because I see his role as being very compatible with the first minister’s in these matters.

There could be no question the Premier of this province is right when he says the oil-pricing arrangement presently being discussed is the vital economic issue, not only for the country but for the federalism that keeps us together. In response to the federal position, the Ontario Premier is reported to have said that Joe Clark’s energy position threatens the very economic fabric of Confederation. I agree wholeheartedly. If the deal being talked of today in Ottawa between Messrs. Clark, Hnatyshyn, Leitch, Lougheed and, to a lesser degree, Blakeney, is carried forward, as was suggested in the Toronto Star last week, the country is in a very serious condition.

I have only one political response to the Treasurer and to the Premier. What we’re getting from Mr Clark and Mr. Hnatyshyn is nothing which could not have been predicted, given the various speeches they made before and during the recent federal election contest. What I must say to this Treasurer and certainly to his first minister is really only one basic political thing: Either this government and its leadership in particular supported their federal Conservative friends without knowing where they stood on the pre-eminent issue of the day, in which case they are to be indicted politically and, hopefully, immediately. Or, more seriously, the Premier and to a lesser degree, but not to be absolved, the Treasurer, campaigned actively for their federal friends, knowing what they were going to do with oil pricing, but saying nothing about it. That too, is very condemnable.

Mr. Laughren: You campaigned for the Liberals without knowing --

Mr. Conway: I did know exactly where my federal friends stood on the question of oil pricing. I must say I did not get the impression that our friends across the way had the same appreciation. They campaigned actively.

Interjection.

Mr. Conway: I’m glad to see my friend the member for Durham West, whose fulminations before the resources committee some months ago about a veiled War Measures Act are not being repeated now, as my friend from Huron-Middlesex (Mr. Riddell) said when that “very veiled” War Measures Act -- to use his phrase -- was proclaimed by his friends in Ottawa. I just want to say that you can’t have it both ways. I certainly expect to make some political remarks in this connection over the next few weeks and months.

I have one final point in that regard. The Premier and the Treasurer make the point very well that the Ontario position is one of clarity and, to some degree, it can be understood now from the various presentations made by the Minister of Energy and the Premier. They are looking about for support in that particular regard.

One thing I have not heard from the Treasurer or from the Premier is an undertaking to confront personally the 58 federal Conservative members representing Ontario in the Clark caucus in Ottawa, whose silence on this matter of vital national interest has been, to say the least, stunning and consistent. I must say I would be very appreciative if the Treasurer would give an undertaking to go to Ottawa, or Peterborough or wherever, to meet with the 58 federal Tories and to elicit from them a commitment of where they see the Ontario interest. It would be useful knowing whether or not the Premier and his cabinet can get an agreement from their 58 friends representing Ontario in Ottawa in this connection. Do they -- Messrs. Darling, Finnell and 56 others -- agree with the Ontario position as stated by Messrs. Miller, Davis and Welch, et al? Do they? If so, let’s hear it. If they don’t, let’s hear that as well. I must observe that their silence has been very noticeable from where I stand.

In talking about Ottawa, and I’m speaking now from the point of view of a member for eastern Ontario, does the Treasurer remember -- as I know my colleagues from London Centre, Essex North and Wellington South will -- that Joe Clark and Bill Davis campaigned for the federal Tory cause, which was “to get Canada moving again”?

Mr. Ruston: It’s in reverse.

Mr. Conway: Do you know what we found in eastern Ontario as to this federal administration’s policy with respect to getting Canada moving again? The first prize we won in their new lottery was to hear from the federal Minister of Employment and Immigration, Mr. Atkey, that Canada winter works would go forward, but Ontario would be stripped of its previous place in that program.

In that program, $22.35 million was allocated to this province last winter to alleviate the very serious seasonal unemployment that afflicts not only areas like my own county of Renfrew, but many other counties and districts in this province. In our area, we have received $150,000 for the county generally and that was appreciated because it did alleviate the double-digit unemployment of the area I represent.

I haven’t heard any comment from this Treasurer in that connection. I would like to know, before these estimates are concluded what, if any, replacement strategies he has to supply programs for areas now devoid of moneys which they previously obtained through the Canada winter works program. Canada is, indeed, on the move again but, unfortunately, if we are to judge from some of this federal administration’s commitment to the Ontario jurisdiction, the move is unhappily downward.

Finally, Mr. Chairman, I want to --

Hon. F. S. Miller: That is the second, “Finally.”

Mr. Conway: I don’t think a 12- or 14-minute contribution from a private member to these ongoing debates is overdone. I just want to conclude by suggesting --

Mr. Laughren: A private member; are you a member of the Liberal Party or aren’t you?

Mr. Conway: A private member in these debates, and I know my friend from Nickel Belt has a much greater status than I can ever hope to enjoy.

Mr. Laughren: No, no.

Mr. Conway: Last Wednesday, the government of Ontario announced at long last that it was going to name the new chairman for the Renfrew county task force on economic development, a replacement appointment that has been literally begged for by various municipal leaders and county councils over these past months.

It is certainly demeaning, because we were offered a strategy back in the McKeough days of 1976. It is a nice document that represents the umpteenth report for what this government is going to do to alleviate the serious and structural economic problems that afflict an area such as the One that I represent.

Unfortunately, we still do not have anything but a press release and I know my friend from Nickel Belt will share my concern and abhorrence about this. The Minister of Industry and Tourism says that he will give us a new chairman, but he wants us to know we had better not get our hopes up too high because the Treasurer and the government of Ontario are in a period of restraint and we had better not expect too much; that the Renfrew county economic development scheme probably will not take place over anything less than quite a few years. In other words, “out there in places like Arnprior and Eganville and Cobden and elsewhere, we really think you are second-rate.” They don’t have the courtesy to come forward with not only a replacement for the late chairman at an earlier time, but a clear indication of what kinds of strategies this provincial government is going to offer the people of Renfrew county.

What does the Treasurer have in so far as immediate and intermediate economic priorities that he is prepared to discuss and prepared to fund? I am sick and tired of studies piled up on studies piled on reports. The time has long since passed for some concrete commitment to the people of Renfrew county, a commitment that will deal with the double-digit unemployment in many of those communities, a commitment which I think has been earned by their in many ways ongoing political commitment to this particular government party. I would certainly like to hear from both the Minister of Treasury and his colleague in Industry and Tourism as to what specific commitments -- the funding arrangements and the strategies -- are going to be offered to the people I represent, who have, unfortunately, been fed a diet of neglect for too long. I think the time has come for some concrete action and I await the Treasurer’s response to that particular concern.

On motion by Hon. Mr. Wells, the committee of supply reported progress.

The House recessed at 6:02 p.m.