Hansard Transcripts 1980-Apr-17 | Legislative Assembly of Ontario

In an article in the Hamilton Spectator of last night, a copy of which I have sent you, an official of the Ministry of Natural Resources makes comments, which I believe would be interpreted by any reasonable person to indicate that I have knowingly been in possession of illegally removed property. I suggest the making of that accusation by that official is a breach of my privileges under the Legislative Assembly Act, and I would ask for your ruling.

Mr. Speaker: Obviously, I haven’t had an opportunity to look at it and I am not going to take the time of the House now. I will look at it and see whether there is any basis for any question of your privileges having been abrogated.

STATEMENTS BY THE MINISTRY

Hon. Mr. Parrott: Mr. Speaker, I would like to outline to the members of the House certain arrangements to ensure the availability of all testimony needed to enable the Environmental Assessment Board to reach well-informed conclusions on matters before it. To achieve this, we are putting into place --

Mr. S. Smith: Mr. Speaker, I am sure the honourable minister has the report somewhere but I regret it hasn’t reached my desk. I would like to follow his statement, if I could.

Hon. Mr. Parrott: Mr. Speaker, I thought it had been distributed.

OLEOMARGARINE-BUTTER BLEND COMMITTEE REPORT

Hon. Mr. Henderson: Mr. Speaker, today it is my pleasure to table the report of the Oleomargarine-Butter Blend Committee. It is my understanding this has been sent to the opposition parties and the report will be delivered to you, sir.

Mr. Peterson: The honourable minister doesn’t have to send his; it doesn’t matter.

Hon. Mr. Henderson: Wait until the honourable member hears it. The committee also investigated colour differentials in margarines and the situation with regard to cheese analogs.

The members of the committee represented the Ontario Creamerymen’s Association, the Ontario Cream Producers’ Marketing Board, the Ontario Dairy Council, the Milk Commission of Ontario, the Ontario Milk Marketing Board and the farm products quality branch of my ministry. The committee received 21 briefs or reports from concerned organizations and individuals.

This report points out that there would be serious consequences for our dairy industry if the present regulations affecting these matters were to be changed. In general, I am in agreement with the findings of the committee.

Experience in other jurisdictions shows that once butter blends are introduced, the butter part of the blend is constantly reduced until it gets as low as five per cent. This could mean a reduction of as much as 15 per cent in the country’s total market share quota.

In the case of cheese there are two serious drawbacks. Not only would dairy farmers lose part of their market but our import situation would be affected as well. We would have to import the analogs at first since none are made here. Later we would have to go on importing vegetable oil and components as not enough are available here. In my opinion cheese analogs represent a threat to one of our finest agricultural products -- Ontario cheese.

As far as the colouring of margarine is concerned, I believe consumers have a right to know, just by looking at it, whether they are getting butter or margarine. There is no reason that I can see why margarine should be allowed to masquerade as butter.

Therefore, I will not be proposing any changes to the regulations governing these three matters.

ENVIRONMENTAL ASSESSMENT BOARD

Hon. Mr. Parrott: Mr. Speaker, I would like to outline to the honourable members of the House certain arrangements to ensure the availability of all testimony needed to enable the Environmental Assessment Board to reach well-informed conclusions on matters before it.

To achieve this, we are putting into place funding arrangements which will enable panels of the board to bring before hearings such expert testimony as is seen to be appropriate at their discretion. This will apply to all hearings in progress and future hearings under the Environmental Protection Act and the Ontario Water Resources Act.

Although the Environmental Assessment Board is an independent body and not subject to my direction, I have advised them through my deputy minister that the ministry is willing to accept the costs incurred by these arrangements.

In making such determinations with respect to the calling of expert testimony before it, we expect the board will invite representations from the parties involved in the hearings.

PROFESSIONAL ORGANIZATIONS COMMITTEE REPORT

Hon. Mr. McMurtry: Mr. Speaker, today I am tabling the report of the Professional Organizations Committee which I received this morning. The committee, chaired by H. Allan Leal QC, and consisting of Dr. Alex Corry and Dr. Stefan Dupre, was established by me three years ago to look into the four professions of law, accounting, engineering and architecture.

I don’t want to attempt to make a comprehensive statement covering all the recommendations, for the simple reason that having only just received a copy of the report I have not had a chance to study it in detail. I did want to share it with members at the earliest possible opportunity.

Having looked through the summary of recommendations, a number of important items deserve to be summarized.

The committee’s comprehensive report concludes that, by end large, the professions it studied are healthy, dynamic and responsive to public and self-criticism. The report sets out 81 separate recommendations suggesting changes to ensure that professions more effectively protect the interests of the public and of their members.

The recommendations are aimed at protecting vulnerable interests, ensuring fairness of regulation and enhancing the public accountability of the regulatory bodies.

The committee has been careful to take account of considerations of practicality and feasibility of implementation when framing its proposals. Throughout its work it has engaged in an extensive process of dialogue and consultation with interested groups and individuals. Every possible opportunity has been given to the professions to express their views at length on a broad range of issues.

The report’s recommendations respect the autonomy of the professions; they suggest that the role of government should be largely confined to legislation establishing the powers and general structure of professional bodies.

To ensure that due attention is given to the general public interest, lay representation is recommended on the governing bodies of professions. To guarantee that there be an independent, formal and nonprofessional review of the disposition of complaints by professional bodies, a lay observer procedure should be established in Ontario.

The committee worked with the Association of Professional Engineers of Ontario and the Ontario Association of Architects, as these two professional groups negotiated their joint agreement on the scope of engineering and architectural practice, a matter of long-standing dispute.

2:10 p.m.

Turning to the accounting profession, the committee recommends that the Public Accountants Council should be abolished and the Certified General Accountants Association of Ontario, the Institute of Chartered Accountants of Ontario and the Society of Management Accountants of Ontario should all acquire the right to issue licences in public accounting to those of their members who satisfy common licensing examination requirements. This licence will encompass both audits and nonaudit reviews.

In response to a number of submissions from groups such as architectural technologists, engineering technologists, law clerks and legal secretaries as well as other groups in different occupational sectors, the committee recommends an omnibus statute to permit the registration of reserved titles. The newly certified groups would have to develop and enforce qualification requirements, a code of ethics, a complaints procedure and a disciplinary mechanism.

The committee expresses concern about the proliferation of new licensed professions, suggesting that a special committee should be struck to look into each new claim for professional privileges.

On the question of professional fees, the report suggests that professional rules should require practitioners to disclose to potential clients the basis on which any fees will be determined. There should also be mechanisms for the mediation of disputes concerning fees. The committee rejects suggestions that contingent fees for lawyers be introduced in Ontario. The report recommends that restrictions on lawyers’ advertising in Ontario be further relaxed.

Finally, the committee suggests that the disciplinary processes in each profession should be as much concerned with professional incompetence as with misconduct as such.

I am looking forward to reading the report in its entirety, to discussing it with my colleagues and to receiving the comments of interested organizations, groups and individuals. Once members have had a chance to read the report, I am sure they will agree with me that the committee has produced an invaluable and comprehensive report. The government intends, however, to review the recommendations contained in it and to consider carefully all submissions made before introducing any legislative or policy proposals based on the report.

CIVIL SERVICE STAFFING

Hon. Mr. McCague: Mr. Speaker, I am sure that all members of the House have seen the press reports this morning relating to the report of the Auditor General. In particular, Mr. Macdonell’s apparent observation that the civil service could be reduced by 24 per cent has aroused a great deal of interest. While his report applies only to the federal government, I am sure that this House and the public at large are also interested in the staffing situation in the Ontario government.

To begin with, it must be noted that the size of the Ontario government work force has declined considerably in the last few years. On March 1, 1975, our total staff amounted to 87,109 people. As of December 31, 1979, the work force was down to 82,929. This is a reduction of 4,180 or 4.8 per cent.

During this same time, the Ontario population has grown by 4.2 per cent and population growth is a good measure of the overall work to be performed by the civil service. Thus, considering these two factors, total population to be served and the staffing levels, it would appear that we are improving the productivity of our work force by about 1.8 per cent per year.

The improvement would appear even more substantial if we were considering the new initiatives that have been launched, such as the Ministry of Northern Affairs, children’s services, occupational health and safety -- programs where significant staffing increases have occurred.

In achieving these reductions, we did not take the easy route and concentrate our cuts on that segment of the work force outside the management group. Rather, our five per cent overall staff cut includes a 15 per cent cut in permanent senior management positions. That is, beginning in January 1976 we have reduced our permanent executive superstructure from 689 to 590.

In the 1975 to 1979 time period, while Ontario was reducing its staff by 4.8 per cent, the federal government expanded its work force by 7.3 per cent, adding more than 22,000 staff to the payroll. Perhaps this explains the reason for the report of the Auditor General and why the overall conclusions do not appear to apply to the Ontario scene.

In concert with our emphasis on controlling the size of the civil service, we have been stressing prudent and efficient management of all the programs and services provided by the Ontario government. In this regard we use a systematic approach to program management called managing by results, or MBR for short. The MBR approach stresses the results aspect of the program or service. By identifying and measuring results and by relating them to the resources assigned, we can determine the productivity improvement that is being achieved.

We can illustrate the concept by using a simplified example from one of our typical MBR programs. In 1978-79, the retail sales tax branch in the Ministry of Revenue processed 1.6 million tax returns with a staff of 552 for the year. This same staffing level will be maintained in 1980-81 but the results will increase to 1.9 million returns being processed. This represents a 19 per cent productivity improvement over two years, considering only the processing of tax returns.

MBR cannot guarantee that the optimum level of efficiency has been reached, but it does provide continued emphasis to ministries and program managers to improve productivity.

Considering the overall staffing levels, the MBR approach to program management and our general record of expenditure restraint, I’m satisfied that at this time the Ontario government work force is at the appropriate level. There may be isolated pockets where some latitude still exists. However, we are looking hard to identify and correct these situations which, in total, are not significant.

We have a very good record, attributable to both the priority that this government has assigned to good management and to the excellence of the public service in Ontario. However, we are not resting on our laurels. I look forward to discussing some of the new initiatives that we are undertaking to further enhance the management process, initiatives such as improved management education, management standards, productivity improvement, et cetera.

The distressing fact about this report is that it may apply only to the federal government but it adds to the public perception that government cannot operate efficiently. The management and staff in the Ontario public service has shown this is not the case.

MEMBERS’ ANNIVERSARIES

Mr. Cassidy: Mr. Speaker, to mark the fact that today is the first anniversary of the election of the honourable members for Wentworth (Mr. Isaacs) and Scarborough West (Mr. R. F. Johnston) to the Ontario Legislature, I would say they have done a very fine job.

Mr. S. Smith: Mr. Speaker, we never even noticed they were here. It didn’t even take them a year before they started supporting the government; it’s amazing.

ORAL QUESTIONS

INTEREST RATES

Mr. S. Smith: Mr. Speaker, I would like to direct a question on the subject of interest-rate relief to the Minister of Agriculture and Food (Mr. Henderson).

Would the honourable minister be willing to tell the House whether he is prepared to introduce a program along the lines of the one we have suggested this morning, or along whatever lines he prefers, but something that would offer relief from the high interest rates for the farmers of Ontario, particularly those who are finding themselves in a very severe economic pinch at this time? Would the honourable minister be willing to take action whether the federal government enters or does not?

I’m sure he agrees with me that although the federal government should be of some support in this case, other provinces have helped their farmers without this federal support. We certainly would be willing to help our farmers and take Ontario’s responsibility. Is the honourable minister prepared to do the same?

2:20 p.m.

Hon. Mr. Henderson: Mr. Speaker, in responding to the honourable member’s question, I would like to make a comment or two about his statement. I note he has set out 75 per cent for a certain wage level, 50 per cent for another, and so on down. I have had meetings with farm people who are in difficulty. They are in the position of having filed a completely negative income. In fact, most of them are filing an income at a great loss of $30,000, $40,000 or $50,000.

Their Minister of Agriculture and Food for Ontario is certainly looking for some method of help. I don’t have it all worked out, but I have been working on it all week. I am in no position to give a commitment other than that my staff and I are working on some type of help. At this moment we are not ready to convey it, but I want the House to know that we are fully interested. This statement, the honourable member’s recommendations, will be considered.

Mr. S. Smith: I would certainly thank the minister for that and I am pleased his staff is working on a solution. We will look forward to hearing what that is.

May I, by way of supplementary, question the Treasurer (Mr. F. S. Miller) as to whether he too is working on something that might be of assistance to the small businesses of Ontario and to the home owners who have mortgages to renew this year. Keeping in mind particularly the promise made by the Premier (Mr. Davis) in 1975 that, even though he wanted the federal government to act at that time, he was prepared, if forced, to act by himself to underwrite some of the high interest costs for Ontario home owners, would the Treasurer show us that he too is prepared to help small businesses and home owners whether or not the federal government comes in as part of the arrangement?

Mr. Nixon: Of Course, 1975 was an election year.

Hon. Mr. Davis: But in 1976 the government did something.

Hon. F. S. Miller: The answer is that of course we are working on something and, unlike the party of the Leader of the Opposition (Mr. S. Smith), I am talking to my colleagues about what we are doing. They don’t find it out in a press release; we are working together. I think the honourable member tends to talk to some of his colleagues on the back benches --

Mr. Nixon: What kind of a comment is that? Mr. Speaker, I would certainly ask you to call the Treasurer to order so that he does not misrepresent the facts in the instance to which he is referring. We worked very carefully on the program and support it. The honourable minister doesn’t have a damned thing to offer.

Mr. Speaker: Does the Treasurer have a further response?

Hon. F. S. Miller: It’s so seldom that I pique the anger of the member for Brant-Oxford-Norfolk (Mr. Nixon). I try not to because I recognize the tenuous state of his health.

I think one can look at the relief we do give and at the attempts we have made. I will be bringing down a budget next Tuesday. We had hoped to see some results in the federal throne speech. There are some hints; we are not sure what they are. We would point out that we do give a good deal of help to farmers in this province that doesn’t get counted. I don’t know what the total figure is; I think it’s something like $128 million or $148 million in property taxes.

Mr. Riddell: You are not using that property tax rebate? Surely you are not.

Hon. F. S. Miller: The honourable member doesn’t want it? Would he like to go back and tell the people in his riding he doesn’t want that 50 per cent in tax given back? That’s one of the best things we do and the member knows it.

Mr. Speaker: Order. A supplementary.

Mr. S. Smith: Specifically, the farm question to the Minister of Agriculture and Food asked what small business --

Mr. Speaker: Order. Obviously the Treasurer wasn't addressing himself to the supplementary or the original question. Does the member for Ottawa Centre (Mr. Cassidy) have a supplementary?

Mr. Cassidy: Yes, Mr. Speaker. I will direct this to the Treasurer and just ask him whether he is aware that in the Owen Sound area there now are five forced sales a month because of interest-rate costs, where last year there was only one a month. Is he aware that auctioneers in the Cambridge area tell us there now are 15 to 20 forced sales a month, where before there was only a handful, and that the picture is the same in other parts of the province, in particular among young farmers who acquired their farms in the last five or six years? Is it the government’s intention to bring in relief so that these farmers can stay in business and not be forced out?

Hon. F. S. Miller: Mr. Speaker, of course it is our intention to fry to help that area. We have been trying to get federal help. I hope my colleague would agree it would be much more useful on a co-operative basis.

It is a sad fact that this province, through good financial management, has made some room for discretionary decisions, while it appears that our colleagues in Ottawa, through relatively poor financial management, do not have that room to move. It’s difficult for us, with perhaps one third of the fiscal base to their 40 per cent, to be faced with the suggestion that all the costs should fall back on us. We are going to do our best.

I think the one happy note I saw yesterday was the indication that perhaps the peak had been reached in the interest-rate cycle. In New York City a very respected economist said he believed the top of the cycle had been reached. Today in Canada the president of the Royal Bank re-emphasized that statement. We saw bonds go on the market from Ontario Hydro yesterday, and following that news in New York City they went to a premium. That is the first good news we have had in that kind of market.

We have some reason to believe the peak has passed. That does not in any way stop us from examining those routes that are within our fiscal competence to follow.

Mr. Peterson: Mr. Speaker, I have a question about small business. In view of the fact that in southwestern Ontario alone there has been a 40 per cent increase in bankruptcies, not only personal but corporate, and principally involving small business, would the Treasurer consider going jogging around Queen’s Park and rattling his head again to come up with a program in the next few days, as he did with the car rebate program, to bring in some immediate relief?

It is clear to everyone, including his colleague the Minister of Agriculture and Food, that time is very much of the essence. Would he commit himself to move immediately on these very pressing social and economic problems?

Hon. F. S. Miller: Mr. Speaker, we are working quite quickly on it.

Mr. McGuigan: Mr. Speaker, I have a question for the Minister of Agriculture and Food. When he is twisting the arms of his cabinet colleagues, would he point out to them that the agricultural sector has provided the greatest annual increases in production of any sector of our economy. Farmers are not the cause of inflation: they are one of the means of holding down inflation. The record is very clear in this matter. I am sure the minister has that information.

Hon. Mr. Henderson: Mr. Speaker, let the record be put straight. My cabinet colleagues do not need their arms twisted; they are well aware of the situation.

Let me inform the honourable members across the way that it is not simply a question of high interest rates. The price of farm products is not high enough. You can put the interest rate at zero and the farm people still have a problem. Let’s not kid ourselves; it’s more serious than we think.

AUTO INDUSTRY LAYOFFS

Mr. S. Smith: Mr. Speaker, I would like to direct a question to the Premier (Mr. Davis). In view of the massive layoffs and terminations in the auto industry, which account for one out of every six jobs in Ontario, directly or indirectly, would the Premier agree to establish a select committee of this House to examine the immediate impact of the layoffs and the future prospects for the industry in Ontario, by hearing the views of senior officials of the auto companies, the parts manufacturers, the workers, the mayors of the communities affected and others?

In making his reply, the Premier might recall the select committee on Inco layoffs, established under similar circumstances in November 1977.

Hon. Mr. Davis: Mr. Speaker, I do not think a select committee is needed to obtain the bulk of the information which the Leader of the Opposition (Mr. S. Smith) is suggesting would be relevant. I have never been reluctant to make available any kind of information that would be helpful to members of this House. I shall certainly take a look at that information the Leader of the Opposition has suggested would be worthwhile having. I would have to assess the practicability or the wisdom of having a select committee involved in this. Some of the information is readily available, and I will endeavour to get that for the honourable member.

2:30 p.m.

Mr. S. Smith: If the Premier would give consideration to a select committee, I would appreciate it. I think there is some merit in all of us being part of the solution instead of being perceived, as we sometimes are, as part of the problem.

I would ask the Premier, in the absence of the hon. Minister of Labour (Mr. Elgie), whether he has given or would give some thought to encouraging McDonnell Douglas of Canada Limited, which will be hiring for the expanded work that they have to do on the F-18A, to hire laid-off automobile workers who in many instances have the same skills, or skills which could with only a little work be upgraded, freshened or adjusted to the requirements of the airplane industry?

Given that the aircraft industry is expanding at the time the auto industry is in trouble, would it not make sense for many of the auto workers to go to McDonnell Douglas? Could the government try to be of assistance in this regard in working with McDonnell Douglas to help in the retraining as required so this kind of cross-hiring could occur?

Hon. Mr. Davis: I am not quarrelling with the idea, but I have to tell the member it is not really new. I know the researcher from the Liberal office was in touch with McDonnell Douglas earlier today with two or three inquiries. I would only say to the Leader of the Opposition that there are a number of people formerly employed in the automotive industry who have already been in touch with McDonnell Douglas.

From my knowledge of that particular organization, which is geographically situate not too far from my own constituency -- there are a number of people from Brampton employed in McDonnell Douglas, and I have some modest knowledge of the company’s activities -- I think I can assure the members of this House that their requirements will increase, not just because of the F-18, but also because of new work that has been given to McDonnell Douglas with respect to the DC-9. The McDonnell Douglas plant in Malton, which is part of Mississauga, is devoted to the commercial aircraft part of the company’s activities, and has expanded its work force in the past two years very substantially.

I personally will undertake to chat again with the people of McDonnell Douglas with respect to assisting in any way they can those people who have been laid off in the automotive industry. I say to the honourable member that I appreciate the suggestion, but it is not really new.

Mr. Cooke: Mr. Speaker, I would like to ask the Premier how it is that on February 26 the Ford Motor Company was able to issue a press release in Cleveland stating that, if there were plant closures in that city, it would be for the purpose of retooling to meet the new market demands, yet in the Ford Motor Company of Canada Limited announcement of the layoffs in Oakville and Windsor there is absolutely no commitment to retool those plants to meet the market forces that we know now exist? Why do American workers get treated that way by an American corporation and Canadian workers get the poor end of the deal?

Mr. Warner: Because they got our money.

Hon. Mr. Davis: What is the member’s trouble?

Mr. Cooke: Just answer the question for a change.

Hon. Mr. Davis: I didn’t hear that constructive suggestion.

Mr. Cooke: I’d like to hear a constructive answer for a change.

Hon. Mr. Davis: Pardon?

Mr. Cooke: Let’s hear an answer.

Hon. Mr. Davis: I was being interrupted by one of the member’s friends on his right.

Mr. Foulds: We have no friends on our right.

Hon. Mr. Davis: I’ll tell the member for Port Arthur (Mr. Foulds) that he is slowly losing his friends on the left, too.

Mr. Foulds: I may be, but my party isn’t.

Hon. Mr. Davis: I wasn’t talking about the member for Port Arthur’s party; I was talking about him. I would only say to the member for Windsor-Riverside (Mr. Cooke) --

Interjections.

Hon. Mr. Davis: If his own members would stop interrupting me, I might be able to answer his question. Would he please do me a little favour and discipline his own colleagues?

Mr. MacDonald: The Premier should discipline himself and answer the question. He is filling in time. Doesn’t he have an answer?

Hon. Mr. Davis: The member for Port Arthur was interrupting me.

I’m not familiar with the press release from Cleveland, Ohio.

Mr. Laughren: We can tell by the Premier’s answer. By his stalling, we can tell.

Hon. Mr. Davis: All right; the member is familiar with it. Some researcher gave him a press release from Cleveland, Ohio. I don’t have it. All I can suggest to the member for Windsor-Riverside is that he won’t get me making any brief for Ford, GM, or Chrysler, but he might for American Motors. He won’t get me making a brief for other reasons.

I would only say, as we see the figures that were announced yesterday -- and I say I haven’t got the final figures -- it would appear that the number of layoffs in the American part of the automotive industry, on a percentage basis, probably are as high as or higher than they are here --

Interjection.

Hon. Mr. Davis: All right; so the honourable member disagrees. I think the figures may show that. I think it is also important, to keep this issue in some degree of perspective, that the figures of layoff --

Mr. Cooke: The Premier thinks so? Has he bothered checking?

Hon. Mr. Davis: The honourable member was kind of rude to me just a few minutes ago. I am trying to give him as much information as I can, and he continues to interrupt. The honourable member can’t have it both ways. Does he want to listen or does he want to interrupt?

Can I just give the honourable member one or two other statistics? I have them at the moment only from the American side of the border, but in 1975 the total layoffs were in the neighbourhood of 212,000. I am not going to be held to these statistics, because I think we have to keep this in perspective and recognize that the automotive industry has gone through cyclical difficulties before. The best estimate at the moment is 176,000. Those are US figures; we are going to get the Canadian figures.

In 1975, in terms of layoffs or downturn in the market the automotive industry was experiencing as significant a problem as it is facing now. This may alter within the next month; I can’t predict the market, but I think as we assess this whole question we do have to keep it in perspective. The automotive industry was in trouble in 1975; the figures are here. The automotive industry recovered and went through two or three very good years in terms of total production and total employment.

The best information we have from the industry generally is that the automotive industry will regain that over a period of time. It is not going to happen in the next 30 days or two months unless automotive purchases increase, unless consumer attitudes alter. But the reality at this moment is that people are not buying automobiles.

I think it is important from our perspective that Canadian auto workers are not receiving the short end of the stick, which I believe was the phrase used by the member for London Centre (Mr. Peterson).

Mr. Warner: They sure are.

Hon. Mr. Davis: The member doesn’t even know what the figures are, I would say to the Magna Carta from Scarborough-Ellesmere; he hasn't the foggiest idea.

Mr. Warner: I know they got $28 million of our money -- and no jobs.

Hon. Mr. Davis: I don’t mind interjections if the member knows what he is talking about, but he doesn’t.

Mr. S. Smith: Coming back to the subject of McDonnell Douglas, has the Premier heard some of the rumours which have been circulating that McDonnell Douglas is giving consideration to seeking the importation of certain skilled workers because of the additional work it has received?

Would the Premier assure this House that he will take the measures required to make certain that no workers are imported by McDonnell Douglas until the auto workers who are laid off or terminated are offered first chance at all the jobs that exist? Furthermore, would he assure us that his government will be prepared to help with the retraining that might be necessary for the auto workers, so that those whose skills are in some way allied to the ones in the aircraft industry would be able to get those jobs and we will not be importing the skilled workers?

Hon. Mr. Davis: We have to be very careful in this House not to build up an expectation --

Mr. Wildman: Why not put a levy on Ford and have them help with it?

Mr. Speaker: Just ignore the interjections.

Hon. Mr. Davis: It is so hard to ignore those constructive interjections, Mr. Speaker.

We should be very careful not to build up a lot of expectations. McDonnell Douglas has increased employment related primarily to the DC-9 and whatever other components it is building in Malton.

I think the Leader of the Opposition is suggesting that, because of this recent contract, new work will start almost immediately in -- my guess is it will not be Malton; I do not know where some of the work will take place. My own guess is that by the time McDonnell Douglas requires large numbers of people, the automotive situation may have substantially improved.

What I am trying to say is that McDonnell Douglas isn’t contemplating, as I understand it, employing several thousand people within the next two or three weeks or a month. It is not in a position to do that yet. What I can say, because I am relatively aware of the situation, is that as opportunities are available at McDonnell Douglas, it has been the company’s policy, and it will continue to be its policy, to make its very best efforts to fill them -- and it has been very successful in this -- using local people or people in this province. I do not think there is any problem in that regard.

Mr. Cassidy: Mr. Speaker, given the fact that Canada has been getting the short end of the stick as far as automobile trade with the United States is concerned, to the tune of a $3-billion deficit in our auto trade last year, does the Premier not agree that the layoffs in the industry should have been designed to ensure that at the very least we get back to a balance, rather than continuing to run a deficit this year at the same annual rate of $3 billion? What steps is his government prepared to take to ensure that we are spared the kinds of layoffs we are getting right now and that we get back to a fair share of the automobile trade and production?

2:40 p.m.

Hon. Mr. Davis: Mr. Speaker, the honourable member is raising a very complex issue. As he is well aware, part of the problem on the deficit side relates to the parts component of the industry. I think that is a relatively fair statement. That is not easy to resolve in the present situation.

Mr. Wildman: Especially when you send their leader to Paris.

Mr. Speaker: Order.

Hon. Mr. Davis: Mr. Speaker, the member for Algoma (Mr. Wildman) is interrupting again. I want to point out -- I do not want to be provocative because the member has been highly critical -- that one way we have endeavoured to protect the Canadian part of the automotive industry is our modest commitment to Ford Canada.

Mr. Cooke: That was a great decision.

Hon. Mr. Davis: Yes, it was. It was a very good decision. The more we see what is happening, the wiser that decision becomes.

I want to tell the honourable member something else. I have a few of his former supporters in my riding -- people who have been on the line in the automotive industry. The member should go and ask them about assistance to the automotive industry. They are very much in support of it. They happen to have a little greater insight into some of the problems than the member for Windsor-Riverside (Mr. Cooke). Even some of his former friends in Windsor will tell him they are very thankful the government of this province made that commitment. Otherwise that plant, which will be a major asset both in terms of the economy and in terms of employment, would now be nearing completion in another jurisdiction. I wish he had the integrity to stand up and acknowledge that to be true.

Mr. Cassidy: Every auto worker I know says there should be job guarantees.

Mr. Speaker: Order. We have spent 23 minutes on the first two questions. A new question.

OUTBOARD MARINE

Mr. Cassidy: I have a new question for the Premier, Mr. Speaker. Today the parent company of Outboard Marine Corporation of Canada Limited in the United States announced that it is eliminating the global product mandate of its Peterborough plant to export outboard motors to Africa and South America. It is going to take that export trade back to the United States, thereby eliminating 40 per cent of the output at the Peterborough plant in Ontario. In view of the fact that plant has been profitable and has been selling every outboard motor it could produce, what action does the government intend to take to maintain that production and the hundreds of jobs connected with it in Ontario?

Hon. Mr. Davis: Mr. Speaker, I may be wrong in this, but I think the Minister of Industry and Tourism (Mr. Grossman) is in Peterborough right now.

Mr. Cassidy: Since the Minister of Industry and Tourism is having a seminar in Peterborough that has nothing to do with this particular closure, as far as we were able to establish, is the Premier aware that the shutdowns at Outboard Marine since 1964 have taken away snowblower production, snowmobile production, chainsaw production and, in February, 276 jobs involved in parts production? Will the Premier say what steps the government is prepared to take to stop American companies shutting profitable operations here in Canada and taking the jobs back to the United States?

Hon. Mr. Davis: I will deal with only one part of the question. I am only going by memory, and I could be totally wrong. When it comes to the question of the snow machines, or whatever the trade name was, production was not taken to the United States; I do not believe it was. My recollection is that Outboard Marine decided to get out of that particular market, as have a number of others, because there were too many people in the marketplace with respect to snowmobiles. I may be wrong about that, and if I am I will make that point tomorrow.

I would make this point to the honourable member: In regard to the chainsaw business, this government was somewhat beneficial and helpful in that particular community, to the extent that there now are many people employed. It was this government’s initiative that caused that to happen. We have always been prepared to assist where we can in the maintenance of any employment in that community or any other, and we have had some measure of success in doing so.

Mr. Cassidy: Will the Premier say what the government intends to do with its policy of global product mandating when that policy is costing us the jobs connected with 40 per cent of the outboard motor production at the Peterborough plant of Outboard Marine and when there is consistently more evidence, as at Firestone Canada Limited in Whitby, that global product mandating is a means of taking jobs away from Ontario, rather than bringing jobs to the province?

Hon. Mr. Davis: I am not sure there is any factual basis for those observations. One can argue global product mandating any way one wishes --

Mr. Wildman: Which is just what the Premier is doing.

Hon. Mr. Davis: I have to say that the member for wherever is at his noisiest and nonconstructive best today. Is he enjoying his gum? I could observe very kindly that he is certainly beating them with great regularity this afternoon.

Mr. Martel: My, you’re funny.

Hon. Mr. Davis: Well, he provokes me.

I have to say this to the honourable member: With respect to, say, outboard marine engines, it is not just a question of global mandating. I think he will find, if he gets his researchers to work, the reality is that the market at this time has diminished somewhat. Outboard Marine produces a range of outboards. They are under the trade names of Johnson and Evinrude. I don’t want to betray any trade secrets, but in many respects they are the same engine. It is not just a case of global mandating.

Firestone was not a case of global mandating being wrong. Firestone was in some difficulty. It had overproduction. Unfortunately, we lost a plant in Whitby, but there were several plants in the United States that closed at the same time, one in Salinas, the only industry in that community. They grow artichokes in the surrounding community, and I think 1,800 to 2,000 -- maybe 2,200 -- were laid off in Salinas.

All I am saying to the honourable member is that I think it is a bit unwise to say it is only this province or this country that is being affected by the existing economic situation. It is, believe it or not, happening in the United States. I would not argue, but I would suggest, as I did to the member for Windsor-Riverside, that on the automotive side of the impact in the United States has been as great in percentage terms as it has been here.

Mr. Speaker: I want to remind all honourable members that the question period started at 2 p.m. We have heard three questions. A survey of the use to which the question period was put was done by our Legislative Library research staff. They reminded me that in a 10-day period, an hour and 42 minutes of the time of question period was pre-empted by interjections such as we have had today by the member for Algoma. So it is your question period --

Interjections.

Mr. Speaker: A new question.

SELECT COMMITTEE ON ECONOMIC AND CULTURAL NATIONALISM

Mr. Cassidy: Mr. Speaker, does the Premier not think it is time to reconstitute the select committee on economic and cultural nationalism, which sat in this House in the early 1970s? In the past month, we have had major layoffs in the automobile industry, the major shutdown of Firestone in Whitby, major layoffs now occurring at Outboard Marine in Peterborough and the shutdown of the Beach Appliances International Limited foundry in my riding of Ottawa Centre.

Would the Premier give an undertaking to this House that the committee will be reconstituted and that it will be given a specific mandate to look at the way foreign-owned corporations are shutting down plants here in Ontario?

Mr. Riddell: And buying up our good farm land.

2:50 p.m.

Hon. Mr. Davis: Mr. Speaker, the member for wherever in the Liberal Party --

Mr. Speaker: Order. The Premier knows the problem we are having. He should ignore the interjections. If he has a response directly to the question, I wish he would please give it.

Hon. Mr. Davis: Mr. Speaker, on that point of order --

Mr. Speaker: It’s not a point of order; it’s a point of view of the chair.

Hon. Ms. Davis: Mr. Speaker, in commenting on your point of view -- no, I won’t do that. The answer to the question is, I am not so inclined at the moment.

Mr. Cassidy: In view of the fact that the Ford casting plant in Windsor made a profit of $11 million last year, and made a profit of $2.5 million in the first quarter of 1980, which is the evidence that the plant was not a victim of the slump in the industry but of corporate manipulation which this government does not seem to want to control, would the Premier be willing to bring into assistance the advice of all members of this Legislature, given the success of the select committee last time, to show a path by which we could establish an economy that is run by and for Canadians rather than at the whim of foreign corporations?

Hon. Mr. Davis: Mr. Speaker, in order to meet your view, my answer is still the same.

ESSEX EXPLOSION

Mr. Ruston: Mr. Speaker, I have a question of the Minister of Intergovernmental Affairs (Mr. Wells). Could the minister tell me what alternatives he has for assisting the town of Essex with regard to the February 14 natural gas explosion where about $5 million worth of buildings were destroyed? Since the government is not designating the area, what alternatives do the merchants have to try to get any assistance from the Ontario Development Corporation?

Hon. Mr. Wells: Mr. Speaker, in response to a meeting with the mayor of Essex, who asked that we consider the problem there, we reviewed it very carefully. It was obvious that the normal designation of a disaster area under our disaster relief fund was not an appropriate thing to do in the case of Essex since the losses involved were not those for which funds were going to be raised in the community and matching provincial dollars would be needed. We looked at the other components of this disaster. There is a lot of insurance coverage involved. Obviously, there are going to be liability insurance claims and liability battles.

The solution we came up with was that the Ontario Development Corporation people, from the Ministry of Industry and Tourism, will discuss things they might do to help in the area. Beyond that, I see no further provincial involvement necessary.

Mr. Ruston: The minister said there were no funds to be raised locally. I want him to be aware that a committee has been set up to raise funds locally, and between $4,000 and $5,000 already has been raised. I would ask the minister, if it takes a designation for the town of Essex to be eligible for funds at a lower interest rate from the Ontario Development Corporation, why could he not designate it with a limited amount for the dollar-for-dollar assistance and still allow the development corporation to lend the money?

Hon. Mr. Wells: There is no legislation or legal provision for designation to bring into effect a plan that provides Ontario Development Corporation loans at low interest. There is no such program. The Ontario Development Corporation has certain ground rules and certain things it can do. My suggestion was that their people talk to each of those local businessmen who have a problem down there and see if one of the regular ODC programs, or something they have in place in other places in the province, might be of help. They are going to have to do that and consider each case individually and on its own merit.

Mr. G. I. Miller: I have a supplementary to the minister which is not in regard to Essex, but it is with regard to the disaster relief fund.

Mr. Speaker: Sorry, the original question was quite specific.

CHILDREN WITH LEARNING DISABILITIES

Mr. McClellan: Mr. Speaker, I have a question of the Minister of Community and Social Services (Mr. Norton). He may recall last Tuesday when the question of funding to learning disabled children under vocational rehabilitation was asked, the minister replied with respect to a recent court decision, “I have asked for a copy of the reasons for the decision.” He went on to say that the effect of the decision seemed to be to make the use of the Vocational Rehabilitation Services Act illegal for funding children with learning disabilities.

I want to ask the minister whether he has discovered yet that the reason for the decision was the fact that his director of vocational rehabilitation services sued in the Ontario divisional court against the decision of the Social Assistance Review Board to try to overturn a decision in favour of a young man called Mekler. Can he explain why his ministry sued against the decision of that board and why, in particular, his ministry argued in court that funding under the Vocational Rehabilitation Services Act for learning disabilities was illegal? He has caused this mess himself.

Hon. Mr. Norton: Mr. Speaker, since responding to the honourable member’s question a week ago, I have had an opportunity to review the decision which I had not had at that time. I think the import of that decision is open to more than the interpretation that has been placed upon it.

Mr. McClellan: Answer my question.

Hon. Mr. Norton: I am, if the honourable member will just listen for a moment. It may be difficult to explain to him the point I am trying to make, because it is to some extent a legal nicety.

The case in question was dealing not with a child but with an adult. The question before the court dealt with the issue of whether, under the Vocational Rehabilitation Services Act, a vocational objective or goal was necessary as part of the plan to qualify for funding. The court found in that case that was so.

It has also come to my attention that the Social Assistance Review Board, in hearing some appeals since that time, apparently had applied that decision as binding absolutely. I sought some additional legal advice, rather than try to advise myself, and I was pleased there was some body of legal opinion that supported my perception of that decision.

I have since met with my senior staff and I have directed them, as a matter of a policy decision on my part, that they will not treat that decision as binding upon the applications for assistance to learning-disabled children. I said that in my opinion, and as a matter of policy on my part, that wasn’t an issue; that wasn’t what was before the court. The decision of the court went beyond -- the member shakes his head. If he has a legal opinion to the contrary, I would be glad to hear it.

I would like to point out to the member that as a matter of policy I have directed my staff that we will treat the educative goal of the program with respect to learning-disabled children as pre-vocational and therefore we will continue to receive those applications and to process them. I have also communicated my policy decision to the chairman of the board so that the board may take that into consideration in making its determination on any appeals that might come before it.

Mr. McClellan: Is the minister aware that the Social Assistance Review Board has been using the Mekler decision as an excuse to turn down appeals involving kids with learning disabilities? I have one such case here which uses the precise language of the Mekler decision.

Does the minister not think it would make sense for him to amend the regulations of the Vocational Rehabilitation Services Act so that it is absolutely clear that the act entitles children with learning disabilities to financial assistance? Would not his ministry just stop all this game-playing it has indulged in over the last five years?

Hon. Mr. Norton: I do not wish to inflame the passions of the honourable member opposite whose passions often tend to distort his perception of the facts. In this matter, I think I and the staff of my ministry have acted very responsibly, and I don’t believe any change in regulation is necessary. I believe that the policy decision I have directed my staff to apply to those cases is sufficient. I am aware that in two or three cases the board applied that decision, and presumably it is one of those decisions that the honourable member has before him.

3 p.m.

I do not have the authority to direct the board, but I have advised them that I would like to see them reopen those cases or invite counsel to come back before them. I am not sure what the best procedure is, but I have requested them -- I can not direct them -- to reconsider those three cases in the light of my policy directive to my staff.

ASBESTOS AT HOSPITAL FOR SICK CHILDREN

Mr. Leluk: Mr. Speaker, a question to the Minister of Health: In view of the press reports in which the member for High Park-Swansea (Mr. Ziemba) alleged that the Hospital for Sick Children has 100 asbestos fire dampers and that the workers are at risk from this cancer-causing agent, can the minister tell the House if this is so? Has the minister had an opportunity to investigate this situation, and what can he report?

Hon. Mr. Timbrell: Mr. Speaker, I thank the member for that question. I wish the member for High Park-Swansea had been here and had asked it, because I have had a chance to review this matter this morning with my staff and with the officials of the Hospital for Sick Children.

If the Speaker will allow, I would like to read into the record a very brief report I received from the Hospital for Sick Children this morning. It is a very serious matter, and I beg your indulgence.

The letter is from Mr. C. C. Hunt, the administrator of the Hospital for Sick Children. It is addressed to me, and it says:

“At the request of the deputy minister, I enclose for your information a report on asbestos insulation at the Hospital for Sick Children.”

I will be glad to table it, Mr. Speaker, provided any member is interested. The report reads as follows:

“Following Mr. Ed Ziemba’s visit to the hospital on April 15, 1980, hospital authorities have examined the use of asbestos insulation and can report on his statement that asbestos used in recent construction could be getting into the main hospital air supply.

“1.A. Asbestos in air supply (fire dampers): There are no asbestos fire stop flaps installed in the air ducts of the hospital. The ceiling/floor fire rating of the building code does not require them for this structure. Consequently, there can be no contamination from this source.

“1.B. Asbestos in air supply (other sources): For reasons of disease control, the air supply of the hospital is not recirculated. All incoming air passes through a sophisticated system of filters to ensure pure air to both patient areas and research laboratories.”

I questioned the official of the hospital this morning as to whether or not those filters were asbestos filters and he said they were not.

“2. Fume hoods: All laboratory fume hoods are lined with an extremely hard asbestos/cement compound (Transite)” -- I take it that is a product name -- “that is not subject to flaking. All fume hoods vent directly to the outside atmosphere and are not connected to the main hospital air supply.”

Again, under questioning from myself this morning, the official of the hospital confirmed that all those hoods are constantly under negative air pressure and always exhausting.

“3. Steel frame insulation: Only the steel structural beams of one wing (Elm Street) are covered with a blown insulation material. The composition of this insulation is not known but is currently being analysed. The beams concerned are in what is termed ‘dead space’ (i.e., no air circulation) and isolated from the ventilation system.

“4. Medical opinion: In the opinion of the chief of the chest division, Dr. J. A. P. Turner, FRCP(C), and the associate director of the Hospital for Sick Children Research Institute. Dr. J. A. Lowden, MD, PhD, there is no danger to patients and staff.”

I regret that the member is not here. I shall withhold some further remarks I have on his tactics until he is.

LAKE SIMCOE-COUCHICHING REPORT

Mr. Gaunt: Mr. Speaker, I have a question of the Minister of the Environment (Mr. Parrott). The minister indicated in the Legislature on December 18, 1979, that the Lake Simcoe-Couchiching report would be submitted to the cabinet and a decision made in January. What has been the result of the submission to cabinet, and what decisions have been made to deal with this vexatious problem?

Hon. Mr. Parrott: Mr. Speaker, the date might have been a little optimistic, but it has been to cabinet and the decision has been made rather recently. I would like to consult with the municipalities that are going to have to administer the plan, and perhaps to the steering committee as well. I have not had an opportunity to do that as yet, but I hope to do that in the very near future. I will be more than pleased to give the member those details immediately after we have met with both the municipalities and steering committee, if they feel it is necessary.

Mr. Gaunt: Could the minister indicate when the report was submitted to the cabinet? Was it yesterday or was it last week? Further, with the construction of the York-Durham sewage scheme, will the water quality of the rivers and streams east and north of Metro be improved and will the whole scheme affect the phosphorus content and the loadings and, if so, to what extent?

Hon. Mr. Parrott: If I remember correctly, the report went to our policy field in January or early February at the latest. There were some more questions that properly had to be addressed before I proceeded to cabinet with it. I am pleased to say it now has the support of --

Mr. Gaunt: When did it proceed to cabinet? Yesterday?

Hon. Mr. Parrott: I won’t respond as to the exact date, but the member will be pleased to know it has gone through cabinet.

Let me answer the question about what it will do to the streams north and east of Toronto. I am pleased to tell the member it will have a significant effect by redirecting to the Duffin Creek plant. I would not infer that there will be large decreases in the phosphorus loadings to the total area of southern Ontario by the redirection of those plants.

The streams north and east definitely will be improved markedly, not only for phosphorus, but obviously for other substances as well. When the Lake Simcoe reductions are in place -- and we think there are many ways this can be accomplished in addition to mere phosphorus removal at streams and plants -- then there will be a pretty significant reduction to the total basin of the phosphorus loadings.

PROCESSED MEATS

Mr. Swart: Mr. Speaker, I have a question for the Minister of Consumer and Commercial Relations (Mr. Drea) concerning the dropping of charges by the federal government against 57 food stores, including, incidentally, food stores belonging to all the chains, for selling ground beef containing pork.

Has the minister noted that these charges were dropped because the Supreme Court of Canada ruled, specifically pertaining to beer but with a much broader application, that the federal government has no authority to prescribe “standards of composition, strength, potency, purity, quality or other property of any article of food, drug, cosmetic or device”? The article pertaining to this went on to say the court said, “Such powers fall within provincial jurisdiction.”

As this matter of quality, purity and composition of all kinds of food is essential to consumers, as the minister well recognizes, is he going to bring in legislation quickly establishing statutory recipes for processed meats and other food products so as to fill this vacuum which now exists?

Hon. Mr. Drea: Mr. Speaker, I know it is with the best of intentions -- and I presume the member is reading from a newspaper article -- but that is kind of an oversimplification of two decisions by the Supreme Court of Canada. The first is known colloquially as the apples case, which was discussed in this Legislature last session. The second is the beer case.

I am very aware of what the Supreme Court of Canada did in the beer standards matter. I am aware of what it did in the apple matter, and I am somewhat aware of what led to the federal government’s decision to withdraw those charges. I had asked the chief law officer of the crown, the Attorney General (Mr. McMurtry), even before last Thursday’s withdrawal by the federal government, to take a complete look at product labelling, product ingredients and product standards in the light of the apples case decision by the Supreme Court and the Labatt’s case decision by the Supreme Court.

3:10 p.m.

There are some oversimplified interpretations that the federal government has lost its entire jurisdiction. There are some oversimplified reactions that nothing has been lost because they might be able to proceed under an alternative provincial statute, with the exception of the beer matter.

I consider this to be a matter of some urgency. I can assure the honourable member that the Minister of Consumer and Corporate Affairs in Ottawa considers this a matter of some urgency. As soon as the full analyses of those two decisions, plus the withdrawal by the federal government in the beef and pork case, are available I intend to share them with the House.

There are two alternatives. One is the assumption by this province that if that is in the cards for standards, that has implications for the rest of Canada. The other is a method by which there can be an interprovincial approach, with enforcement by the federal government, that would meet the standards and the criteria outlined in those court cases.

I do not want to belabour the issue too long, but the difficulty in the court cases is that the court was not very definitive about the solution. In both those cases they went almost to the line, but they never said exactly what some people are interpreting to them to have said.

Mr. Swart: May I ask the minister if he is aware that Mr. Allan Rosenzveig, who handled the case for the federal government, is not sure there is any method of recouping the authority which they fear they have lost, or may never have had, but he is sure that the provincial government does have full authority over what is produced and sold within this province.

The minister will know, I am sure, that the charges which were laid, even though an investigation was made all across Canada, were laid only against Ontario food stores, and probably because of the inadequate consumer protection in this province. Will the minister go ahead on his own now and bring in that necessary legislation, even though the federal government may have the power in the field?

Hon. Mr. Drea: When I hear that kind of remark, I am not surprised at the debate going on in a province to the east of us which basically involves standards.

If the honourable member had read the apples case -- and he has not, because he looks at me with utter abandonment and bewilderment -- he would know the Supreme Court was moving in a direction.

The beer case involving the generic title for light beer did not originate in this province. It began in the Supreme Court of British Columbia and proceeded to the Supreme Court of Canada.

In the beef and pork cases -- and I do not care if the disgruntled prosecutor feels a bit uptight that he bungled -- they had the opportunity in the food cases to lay charges under the provincial statute, as we discussed last session, or under the federal statute. They chose to lay them under the federal statute.

It is not a question of who can provide the best consumer protection. It is a very fundamental question. If it turns out that the determination by the Supreme Court of Canada is that this area is one that should be, must be and has to be totally occupied by each one of the 10 provinces, without any regard to national standards or inter-provincial trade, this Legislature and this government will be the first to do it.

Until there is a definitive decision and a consultation between the other provinces and the federal government as to what the implications of those court decisions are, I would think it rather foolhardy to say we are going to proceed on a course. The information will be tabled in the House as soon as the constitutional law authorities of the Ministry of the Attorney General have analysed those cases.

MUNICIPAL ASSESSMENT

Mr. G. I. Miller: Mr. Speaker, my question is for the Minister of Intergovernmental Affairs (Mr. Wells). It is a question I have asked before, but I would like a response to a letter from the Haldimand Federation of Agriculture, which stated: “Ministry gives a tax break at the expense of farmers in the city of Nanticoke.” The federation has asked the minister immediately to evaluate the financial affairs of the city of Nanticoke. Has that been achieved?

Hon. Mr. Wells: Mr. Speaker, my friend asked me about that before. I will find out where that situation stands and let him know.

HAMILTON-WENTWORTH REGIONAL GOVERNMENT

Mr. Mackenzie: Mr. Speaker, I have a question of the Minister of Intergovernmental Affairs. Has he met with the mayor of Hamilton and the regional chairman for Hamilton-Wentworth since the unfortunate walkout from council last Tuesday? Can he offer the House any constructive suggestions he has given? Is the minister prepared to consider implementing single-tier government as the only practical solution in Hamilton-Wentworth?

Hon. Mr. Wells: Mr. Speaker, my answer to the first question is yes. The Premier (Mr. Davis) and I met with the mayor this morning. It was a meeting the mayor had arranged with the Premier to talk about sports facilities in the great city of Hamilton. We talked also about some of the regional government problems. I have some discussions coming up with the regional chairman.

I met with the mayor of Stoney Creek last week. As the member knows, there is no unanimity of opinion in that section of the world. I am surprised to hear from the member for Hamilton East (Mr. Mackenzie) and the member for Wentworth (Mr. Isaacs) that they now support a unitary system for that area. If that is the policy of the member, we will consider that as we look at all the solutions for the area.

Mr. Laughren: What is the minister’s policy?

Hon. Mr. Wells: What is our policy? In simple terms, our policy for that area is to make the two-tier regional government, which we brought in, work. I believe that if all the people in that area put their minds to it it could work. If they gave up some of the intermunicipal warfare and some of the other things that are going on, it could work. We have assured the mayor of Hamilton, and we will assure the regional chairman and others, that we will look at the problem and see if we can come up with something to help bring some stability to that area.

Mr. Mackenzie: A supplementary, Mr. Speaker.

Mr. Speaker: The member has 30 seconds.

Mr. Mackenzie: Can I ask the minister if he is considering single-tier government as one of the methods of resolving the issue?

Hon. Mr. Wells: At this time, no.

Mr. Speaker: The time for oral questions has expired.

NOTICE OF DISSATISFACTION

Mr. McClellan: Mr. Speaker, pursuant to standing order 28(a), I would like to give oral notice of my dissatisfaction with the answer to a question of the Minister of Community and Social Services (Mr. Norton) and of my intention to debate it on adjournment this evening.

Mr. Speaker: Pursuant to standing order 28(a), the member for Bellwoods (Mr. McClellan) has given proper notice. I would like to advise the House that this matter will be debated at 10:30 this evening.

ALLOCATION OF SEATS IN MEMBERS’ GALLERY

Mr. Nixon: Mr. Speaker, on a point of order: The members have received a communication from our estimable Sergeant at Arms indicating that, on Mr. Speaker’s behalf, he was reserving all the seats in the gallery for budget night. We know the custom in the past has been that it is not Mr. Speaker’s friends who want to occupy the gallery, but the friends of the Treasurer (Mr. F. S. Miller). Is it not possible that some of the private members might still have access at least to part of the gallery on budget night?

Mr. Speaker: That is news to me. It is my understanding that on the opening, when Her Honour comes in to read the speech from the throne, and during the budget night, it is the responsibility of the Speaker’s office, not necessarily of the Speaker, to allocate those seats according to a formula that has worked well over the years. In the case of budget night, it has been traditional that the Treasurer, since it is his night, be given more seats than normally would be allocated. It will not be the Sergeant at Arms who allocates, but somebody in the Speaker’s office, my administrative assistant, according to a formula that has worked well in the past.

3:20 p.m.

Mr. Nixon: Mr. Speaker, may I inform you further, and perhaps you will be able to help me. The communication reads as follows “On the evening of the budget address the members’ gallery will be reserved by the Speaker’s office as has been the past procedure. Your members’ gallery ticket will not be valid on this night.”

As I recall the procedure, there is a very large wingding at the Albany Club, and all those overstuffed Tories come into the galleries to watch the Treasurer in action. I would simply suggest to you, sir, that you should at least leave some access, perhaps the back galleries, or some of the back rows or something like that, for the visitors who apply to the members of the opposition and I who may not be so much in accord with the pearls the Treasurer is casting on that occasion.

Hon. Mr. Davis: Mr. Speaker, a point of order: I want to make it abundantly clear that probably 50 per cent of the Treasurer’s guests, that the honourable member refers to as being overstuffed, vote Liberal federally.

Mr. Speaker: I think I can give assurance to the member for Brant-Oxford-Norfolk (Mr. Nixon) that we will adhere to a time-honoured tradition that has worked well in the past. Friends of anybody will not get exclusive rights in those seats.

[Later:]

Mr. Speaker: I have just been handed a memo which states verbatim, “Liberals have at least 101 seats for budget.” Does that answer the honourable member’s question?

Mr. Nixon: Why did you see fit to communicate to us, Mr. Speaker, that we would not have access to the gallery?

Mr. Speaker: I was not aware that I had.

LEGISLATIVE PAGES

Mr. Speaker: While the honourable members are here, I want to remind them that the group of pages we have will be serving their last day with us tomorrow. As is the custom, I would like to read their names into the record for posterity.

They are as follows: Anil Anthony, Scarborough East; Brenda Ashcroft, Grey-Bruce; Heather Bromley, Humber; Perry Clarke, Ottawa West; Julian Daboll, Brantford; Carol Dashner, Haldimand-Norfolk; Amanda de Chastelain, Kingston and the Islands; Cindy Fisher, Carleton-Grenville; Wendy Hatch, Muskoka; Stephen Kriter, Kent-Elgin; Laura Leduc, Downsview; Tom Leiper, Wellington-Dufferin-Peel; Brien Lewis, St. George; Douglas Lounsbury, Huron-Middlesex; Michael MacKinnon, Cambridge; Melissa Marentette, Essex North; Marion McDougall, London Centre; Geoffrey Newman, Parry Sound; Paul Prescott, Prescott and Russell; Michael Stirling, Algoma-Manitoulin; Susan Topp, Sault Ste. Marie; and Kerra Wylie, Oshawa.

I am sure all honourable members would like to join me in thanking them for their service.

PETITION

SUDBURY TEACHERS’ STRIKE

Mr. Sweeney: Mr. Speaker, I have a petition to the Lieutenant Governor in Council from parents and students of the city of Sudbury. This petition has more than 1,000 signatures and the first two paragraphs read as follows: “We, the undersigned concerned parents and students of Sudbury, most strongly urge the government of Ontario to take immediate action to settle the Sudbury secondary school teachers’ strike. We believe that the educational future of Sudbury high school students is indeed in jeopardy, and the failure to get them back to school within the next few days will do them irreparable harm.”

REPORT

STANDING COMMITTEE ON SOCIAL DEVELOPMENT

Mr. Gaunt from the standing committee on social development reported the following resolution:

That supply in the following amounts and to defray the expenses of the Ministry of Culture and Recreation be granted to Her Majesty for the fiscal year ending March 31, 1981.

Ministry administration program, $9,124,000; heritage conservation program, $20,002,000; arts support program, $50,114,000; citizenship and multicultural support program, $10,989,000; libraries and community information program, $29,307,000; sports and fitness program, $19,328,000; ministry capital support program, $51,816,000.

MOTION

PRIVATE MEMBERS’ PUBLIC BUSINESS

Hon. Mr. Wells moved that, notwithstanding the standing orders of the House, Mr. Belanger be permitted to carry Mr. Yakabuski’s ballot item this afternoon.

Motion agreed to.

INTRODUCTION OF BILLS

LEGISLATIVE ASSEMBLY AMENDMENT ACT

Hon. Mr. Wells moved first reading of Bill 42, An Act to amend the Legislative Assembly Act.

Motion agreed to.

EXECUTIVE COUNCIL AMENDMENT ACT

Hon. Mr. Wells moved first reading of Bill 43, An Act to amend the Executive Council Act.

Motion agreed to.

Hon. Mr. Wells: Mr. Speaker, these two bills give effect to the recommendations presented to you in the third report of the Commission on Election Contributions and Expenses with respect to the review of members’ compensation. They comply with and fulfil that report completely.

INCO LIMITED ACQUISITION ACT

Mr. Martel moved first reading of Bill 44, An Act to acquire the Assets of Inco Limited.

Motion agreed to.

Mr. Nixon: Have you checked this with your Tory friends?

Mr. Martel: No, but I think a deal was made with the honourable member’s party today that we would support its no-confidence motion if it supported our amendment.

Mr. Speaker, the purpose of the bill is to vest the title and control of the assets situate in Ontario of Inco Limited in a crown corporation, the Ontario Nickel Corporation. If compensation cannot be agreed upon, provisions are made for arbitration. The objectives of the Ontario Nickel Corporation include the task of operating and maintaining the assets of Inco Limited so as to provide employment and other economic benefits to the province of Ontario. The head office, of course, would be located in Sudbury.

3:30 p.m.

ANSWERS TO QUESTIONS ON NOTICE PAPER

Hon. Mr. Wells: Mr. Speaker, I would like to table the answers to question 15, 16, 25, 28, 31, 79, 89, 91, 92, 93 and 94, and interim answers to questions 81 to 88 and 90 standing on the Notice Paper.

ORDERS OF THE DAY

PRIVATE MEMBERS’ PUBLIC BUSINESS

USE OF WOOD AS HEAT SOURCE

Mr. Belanger, on behalf of Mr. Yakabuski, moved resolution 9:

That this House recommends to the Minister of Energy the establishment of a subsidiary of the Ontario Energy Corporation dedicated to the study and full exploitation of wood as an alternative heat source in Ontario.

Mr. Belanger: Mr. Speaker, I am very pleased to have the opportunity today of placing this private member’s resolution before the House.

I don’t believe there is a question of greater interest or concern in this country today than how we ensure an adequate energy supply. Meeting our increased energy demands is a complex and intricate problem, one which cannot be solved by implementing one simple solution.

It is my firm conviction that the answer to securing an adequate supply of energy for this province lies in a number of directions. The largest portion of the answer lies in increased conservation.

This past fall, the Minister of Energy (Mr. Welch) set a target for energy growth in this province. We hope that by the year 1985 the energy growth rate will be kept at two per cent. Currently our energy growth is somewhere around 2.5 per cent per annum. This may not seem to be much of a goal but even a fluctuation of half of one per cent in energy growth can mean a difference of thousands of barrels of oil or a couple of nuclear reactors.

I was very pleased to see the Minister of Energy initiate assistance for Ontario municipalities in an effort to have them set up their own conservation programs. This is a program that has proved to be very successful in California and that should have comparable results in Ontario. Activities such as better subdivision design, recycling programs, rezoning of land use, and changes in the building code can prove to be very successful energy savers.

Conservation also has another advantage over producing new energy sources. The capital outlay for conservation measures is usually much lower than that of building a new power plant. By simply increasing the insulation, by correct placing of heaters in large warehouses, and by using proper ventilation, many dollars can be saved by both private home owners and by industry.

The best energy source available to us today is that barrel of imported oil that we manage to save. As I mentioned before, conservation is the largest component of achieving energy self-sufficiency in this province, but it is not the complete answer. There are other pieces of the puzzle which will contribute to completing the overall picture.

I have heard many solutions to our energy problems. Many are often touted as being of great importance. I believe they all have a role to play in finishing this energy puzzle, but we must put their contributions in the proper perspective. We in government cannot always give the public a simple answer. In this particular ease, the public by and large is looking for an energy panacea -- one answer to all our problems. This government must continue to stress that no such answer yet exists, nor does the near future hold much promise of finding one.

What we can accomplish is to make sure we have the ability to use all the possible pieces. The Ministry of Energy must have the capacity to co-ordinate and develop existing and future energy sources. Just because ethanol may prove to be a viable answer to some of the transportation problems in the midwest United States does not mean it will be applicable here. Agricultural capabilities in the Ottawa Valley are radically different as are the climate and transportation needs. The job of the Ministry of Energy should he to identify and analyse these differences and then help promote these individual solutions.

I believe we have taken some of the initial steps needed to increase our indigenous energy sources. Last summer the Ontario Energy Corporation was restructured and given a mandate to become more involved in the commercial development of a wide range of new energy projects. As an economic Conservative, I was also pleased to note that this activity was to take place without displacing private investment or private initiative. Funding was increased and a number of directors from the private sector were added to its board of directors.

The corporation has continued its involvement in the Polar Gas project, producing energy from municipal wastes, feasibility studies on ethanol and methanol production, and the Bruce and Pickering agri-park projects. But I feel further expansion is needed to explore other solutions.

Subsequent to a promise in this year’s throne speech, the Minister of Energy announced that OEC will establish subsidiaries in four areas of activity, namely, conventional energy resources, alternative energy sources, power sharing and energy transportation. It is a step in the right direction but I would like to see further diversification.

Instead of lumping in hydrogen production with methanol production, why not create a separate organization dedicated to that and that alone? It would still fall within the stated objectives of OEC and perhaps intensify the corporation’s effort in more specific areas. It would also remain as a stimulation to the private sector and initiate investments in a variety of energy projects that normally might not be considered.

I believe it is important that OEC underline the importance of individual energy sources. I am convinced the private sector will be more impressed with a subsidiary corporation devoted to a single energy source than one that has many sources that fall within its purview. If this is the case, then it would naturally follow that areas of the private sector that are not involved in energy investment might make the investment that is crucial to energy source expansion. One such energy alternative development that would benefit from such a structure would be the use of wood heat in Ontario.

Using wood heat as an alternative fuel source is perhaps not as jazzy as solar energy or hydrogen but it has played a significant role as a heat source in the past and has the potential of playing just as important a role in the future. Because of this image problem, a separate subsidiary of the Ontario Energy Corporation may well provide the focus needed to launch this alternative energy source into playing an important part in meeting our energy needs.

Although there are no statistics for early Ontario, it is fairly certain that wood provided close to 100 per cent of the fuel needs of our early settlers. I don’t think it would be unreasonable to assume that the needs of the Canadian Indian were met by that same category. Wood continued to be the primary fuel for Ontarians until the latter part of the 19th century. It was used for heating homes, cooking, to produce the hot water needed in farms, and for cottage industries. It provided charcoal for iron-making and steam for the early steam engines, railroads and steam-powered sawmills.

But things started to change at that time. As industry grew, its needs changed. In the second half of the 19th century, coal became increasingly important as an industrial fuel. It was not until the late 1800s that coal began to surpass the solar fuels, wood, water, and wind, as the primary industrial fuel.

Yet, despite the displacement of wood as a chief source of industrial fuel, the same changes did not take place until much later for residential heating. Until well into the 20th century, wood remained the major home heating fuel in Ontario, finally declining only in the face of the abundance of cheap and convenient oil, gas and electricity.

3:40 p.m.

In the mid-1950s about 10 per cent of all Ontario dwellings were heated by wood. That figure fell to about three per cent in the mid-1960s. Wood heat, at its lowest point in Ontario in the mid-1970s, constituted less than one per cent of all residential heat for dwellings in this province. At the present time this figure has risen just slightly. It has been estimated that more than one per cent of residential heating needs are being met by wood heat.

It is not what one would exactly call a staggering resurgence. This figure of one per cent can be vastly improved upon. As a source of residential heating, wood should play a greater role in meeting our energy demands. Northern New England, for example, was using an amount of wood for home heating in 1973 comparable to Ontario -- less than one per cent. But right now more then 20 per cent of homes in northern New England are heated primarily with wood and more than 50 per cent of all homes are partially heated with wood. I can see no reason why a similar growth cannot occur here in Ontario, especially in areas of northeastern Ontario.

The reason for such a resurgence is not just purely an economically motivated one. Although using wood as a residential heating source can provide a substantial saving for those who are unemployed or are from low-income families and who can cut their own wood, the saving compared with oil, gas or electricity may amount to hundreds of dollars a year. But for those with little time to spare, cutting their own wood may provide only a marginal return. For those who cannot or choose not to cut and split their own wood, the saving will not prove to be as great at the present time.

It seems, however, that many New Englanders are hedging against higher energy costs. They obviously feel the price of wood stoves will not rise as quickly and as far as oil or gas prices. Another reason that cannot be discounted for the rise in popularity is a purely emotional one. Many people using wood heat are doing so for political reasons. They know that wood is a source that is American, as are all the components needed to make a stove. On top of that, it is a renewable energy source and is aesthetically pleasing. Let’s face it, I think we would all get a lot more pleasure from throwing a log in a roaring fire than by listening to the furnace automatically turn on.

Where will this wood come from? Will we be able to meet expanded future demands? I believe Ontario will be able to create a new market -- a market for the large quantities of rough and otherwise unusable trees that are ignored by the commercial logging industry.

An in-depth study by the Ontario Energy Corporation would be able to determine the size of this potential woodlot and it would give us a better indication of what percentage of residential dwellings could be comfortably supported by our present stock of trees. This is an endeavour that would be best carried out by separate subsidiaries of the OEC devoted entirely to pursuing wood as a source of heat.

As the market increases, for wood, other benefits to the logging industry should appear. Timber stands should improve with selective thinning. It would provide economic incentive to remove the poor-quality material that at present retards good timber growth. Other benefits would be realized by loggers using whole-tree harvesting machines that increase productivity and reduce the job hazards associated with traditional logging methods. Another benefit derived from using a complete logging approach is that the slash left over from present quality timber can be utilized. At the present time there is no market for this waste. Such a market would provide two distinct benefits. First, this slash is objectionable to both foresters and recreational users of the forest. Removing this waste improves the quality of the forest and its regeneration capabilities. Second, it provides another form of economic return on an otherwise wasted commodity; the percentage of waste from present logging operations should be almost eliminated.

This slash would probably best be transformed into wood chips. At the present time, wood chips would have greater capabilities in an industrial setting, but I do not think that is the only way they can be used. I believe real potential exists for using wood chips as a source of home heating. Two engineers at the University of New Brunswick attest to this fact and point to a broad potential market in the province for wood-chip heating. The New Brunswick Energy Secretariat has provided $7,000 to mount a couple of residential demonstration wood-chip furnaces. A stoker-burner unit was purchased from Sweden and an oil-fired hot-water furnace was adapted to the Swedish unit.

The combination was put into service last summer. Operation of this unit has proved much cheaper than that of an oil furnace over the summer months. The furnace burned about one cubic foot of chips a day in heating domestic water. The chips, which were provided at cost from a forest rangers' school, cost about 30 cents per cubic foot. This compares very favourably to the estimated $1.20 cost of the oil they replaced. It is estimated that about 2,000 cubic feet of chips per year will be needed to heat the house. The difference in money is quite staggering; the $600 worth of chips replaces more than $2,000 worth of imported oil.

The system is in the growing stages and is not without its problems. The stoker itself costs about $2,500, which is considerably more than the oil tank and pump it replaced, but there is a positive feeling that this cost could drop with large-scale Canadian production. One estimate has been given of a production unit cost of about $1,500.

Despite the increased cost of the stoked-burner unit, it would still remain attractive to an individual home owner if the difference between wood chips and oil remained the same. However, I am sure most honourable members will agree that the chances of oil prices remaining stable are about the same as the chances of the Organization of Petroleum Exporting Countries holding a two-for-one sale.

The only two remaining problems to overcome in such a system are the constant supply of wood chips and the convenience of the home heating unit. The present unit fails to match oil, gas and electric heat because chips must be added manually in a daily ritual, but a 512-cubic-foot storage-bin stoker would have the capacity for about a month’s supply and would somewhat alleviate the problem. However, I am sure that continued large-scale savings would provide ample compensation for the average home owner. I know I would be receptive to suffering such a minor inconvenience myself. The only other concern is that such a unit is dependent on a consistent and reliable supply of wood chips.

Similar feasibility studies to that conducted for the Ontario government on wood-waste production would be needed. The Hearst wood-waste energy study provides a good model for other municipalities to examine. This area might prove ideal for such residential wood-chip furnaces. The magnitude of the wood-waste disposal in Hearst is quite substantial. It is estimated that somewhere in the order of 129,000 oven-dried tons of waste wood are produced annually.

Only about two thirds of the whole log entering a lumber mill can be converted into commercial lumber and wood chips. The remainder is waste in the form of bark, sawdust and solid wood. At present, this refuse is trucked to landfill sites or incinerated. Even the incineration provides a problem because burners can be a source of air pollution and they require combustion support with significant amounts of natural gas and fuel oil. The annual energy potential in this waste alone is estimated as being equivalent to about 371,000 barrels of heavy fuel oil.

Hearst biomass that can be used as an energy source comes from a number of district sources. Mill residues and logging residues are two sources that have already been mentioned. The salvage of dead and dying timber and intentionally produced biomass for energy purposes such as the hybrid poplar and the European larch, are other sources that may prove significant.

3:50 p.m.

One problem that could have a negative effect on intentionally produced biomass is the possibility that competition would result for land that might otherwise be used for food production. This could result in lower food production and higher food costs, but at present I think this may be an imagined problem. This would exist if that wood were also being used as a human foodstuff, such as corn is, but the land that the hybrid poplar can grow on is usually unsuitable for other, more traditional types of agriculture. As long as farmers grow these trees in currently unused portions of land, it will be an acceptable energy source.

I doubt very much if all mill waste wood is acceptable for such a residential wood-chip furnace, but I am sure at least some of it would be suitable without much reprocessing.

These questions could best be answered by the OEC study, in conjunction with the Ministry of Industry and Tourism.

Mr. Deputy Speaker: The honourable member’s time has expired.

Mr. Belanger: Mr. Speaker, I had a few more comments to make, but thank you very much.

Mr. J. Reed: Mr. Speaker, first off, I would like to commend the government members’ service bureau for writing that speech for the honourable member. At least, I assume that’s where it originated. I would like to commend the member for Prescott and Russell (Mr. Belanger) for his eyesight in being able to read it while standing erect.

I have seldom seen such a great example of attempting to catch the caboose when the train is leaving the station as I have seen this afternoon, with a resolution of that nature. I assume the creator of that resolution, or the speech writer, whoever he might have been, spent some time reading the Hansards of the last four years on energy estimates and speeches in this House, dwelling especially on speeches by the Liberal energy critic regarding the utilization of renewable energy and the benefits of conservation to the people of this province.

It has long been known, at least by members of this opposition, that conservation and renewable energy are the two keys, the cornerstones, of a secure energy future for Ontario. It is quite interesting to see the government, by way of a resolution, suddenly on the road to Damascus, awakening to the great light and turning around and saying: “Maybe these people have something. We’d better get on the bandwagon just in case.” I get a real kick out of that.

I would, however, advise the member for Prescott and Russell, before he embarrasses himself further, to check with the Ministry of Consumer and Commercial Relations and certain divisions within that ministry and decide what their attitude is to the burning of wood in Ontario. He should see whether they have shut down a wood-burning boiler in the town of Acton, which prompted a very important and intense meeting between members of the opposition and the government to try to resolve it. The Ministry of Consumer and Commercial Relations was not accepting the quality of the smoke that was issuing forth during the first few minutes when the boiler was stoked.

I would like to ask the member, before he embarrasses himself further, to check with the Ministry of Consumer and Commercial Relations on its view on add-on wood-burning equipment and the amount of time this opposition spent with the minister and that ministry in trying to get them to adapt their views, to modernize and bring themselves into the 20th century on the burning of wood. It really gives me a thrill.

The member advocates in the resolution the creation of a separate division of the Ontario Energy Corporation to look after this particular area. I am sure the honourable member heard the speech from the throne. In that speech the government, on whose side the member is, has indicated the OEC would be subdivided so that a multitude of energy uses would not be put under one operating framework, but the kind of thing that this thrust suggests would be allowed to happen.

I should also point out to the member, before he embarrasses himself, that he should understand what the OEC is. It is an equity corporation designed to make a profit. If there is an area where we could find support for this resolution, it is that it is not only a recommendation to study the exploitation of wood, but also appears to indicate that the OEC should participate in the full exploitation of wood. If that is the intent of the resolution, I think we can support that thrust.

The honourable member brings to our attention the wood slash that is left when the forest industry, as now constructed, passes through. We brought the importance of wood slash to the attention of this government on occasion after occasion during the last four years. The honourable member will know that the Ontario Liberal Party last fall commissioned and completed a study on methanol using wood slash. We introduced it this past winter to show how important the removal of wood slash would be to the proper reforestation of the province. I wonder just what the member is saying that is new and original.

I cannot disagree with the member’s speech on the importance of utilizing wood and I cannot disagree with the comments he makes on uses outside of direct combustion, because we have been saying these things to the government time and time again, year after year. I can only say to the member that when he supports a resolution of this kind he should remember where the original information and thrust came from. He should remember that had it not been for this opposition party and members of the third party, the government would not be as attached as it appears to be today to the importance of biomass renewable energy and conservation.

There is no question that Ontario has a great wood resource. There is no question that since the turn of the century the utilization of wood has been confined to very specific species, very specific types, and that there exists in Ontario today a plethora -- if that’s the correct word -- of wood.

Hon. Mr. Baetz: That’s a pretty big word the member is using.

Mr. J. Reed: It really is too big a word for me. We have an abundance of species of wood, of acreages of wood that have grown up, matured and now are diseased and dying because they were not in demand by some branch of the industry. Those species certainly can be used, and when they are utilized they can contribute to a much more comprehensive reforestation program than we have ever had in the past.

4 p.m.

That brings me to one other area I want to dwell on, and that is the record of this government in managing these forests. We know the harvesting that is taking place does not involve replacement on any kind of comprehensive basis. We are concerned that any increased effort to utilize wood resources in Ontario, a move which our party supports wholeheartedly, will be accompanied by an equally increased effort in comprehensive reforestation that will allow species to grow and mature and provide for our children and our children’s children a perpetual abundance of this great resource which can add so much to the energy security of Ontario.

Ms. Gigantes: Mr. Speaker, I rise in support of the resolution because it is impossible to be against the resolution. It is like being in favour of motherhood. Far be it for me these days not to speak in favour of motherhood.

It is a shame that the member for Renfrew South (Mr. Yakabuski) is not here to join in this discussion, if we can dignify it with the word. I understand he is ill, and I very much regret he has not been able to join us. The member for Renfrew South is one in this House who we know is capable of riding hobby horses with a skill and flair that few other legislators in Ontario can rival.

It appears that his latest hobby horse is made of wood. Perhaps I could make the suggestion that when he is better we could recommend that he have a sabbatical (that used to be one of his favourite hobby horses; he was not in favour of sabbaticals) to take the time to study the outline of government policy that we have in 1980 that touches upon many areas of conservation and renewable sources that were mentioned by the member for Prescott and Russell. At this point, however, they amount to lists of areas in which the government intends action.

The member for Prescott and Russell gave us a little lecture, which is a new tone from the government these days. He gave us a little lecture on how important conservation was and how we could produce energy by saving energy for Ontario.

All this is true, but I have to remind the honourable member that lists of projects do not save energy. We must have the projects.

We have seen an awful lot of wood wasted in the production of glossy documents. They do not even fill the pages when they print these lists of things they are going to look at in the future. These are the kinds of lists we have been getting for the last two or three years.

Their way of accounting progress in the area of conservation and renewables is to create lists, to recycle lists and to recycle press releases. As the member for Halton-Burlington (Mr. J. Reed) pointed out, the latest list that we got in terms of what the Ontario Energy Corporation is supposed to be doing indicated that this resolution is not necessary.

If I can read some statements from the minister to this Legislature on March 13, he said, in part: “The corporation is currently involved in a number of projects which can be segregated into the areas of activity I have just mentioned which are as follows” -- and he notes in the second point: “In the field of alternative energy the OEC is participating in two projects involving energy from municipal solid waste and in feasibility studies for synthetic liquid fuels, methanol and ethanol.”

When I sought further information on the much-advertised Edwardsburgh methanol study, the information sent to my office indicated the government has proceeded to the point where it is calling tenders for the feasibility study.

There are a lot of questions that need to be asked about the government’s proposals. The only significant and concrete suggestion we have had is that the government will involve itself at least in a study of the possibility of getting into methanol production. The Edwardsburgh site itself is one that is fascinating as a choice. As you will be aware, Mr. Speaker, it is proposed for land that was assembled by the former Minister of Industry and Tourism, the well-known member for Ottawa South (Mr. Bennett), who thought it would make a good site for an industrial park. It turned out to be kind of swampy and out of the way for an industrial park, but now that there seems to be the hope that if we cover it with trees -- hybrid poplars -- it might be a good place to check out the possibility of using wood plantations for the production of methanol.

We are going to have to look at this proposal very closely. The size of the plantation that the government seems to have in mind is so small that one doubts whether the economic attractiveness of wood plantations for methanol purposes is going to be proved or disproved by this project. It was interesting to me to hear the member for Prescott and Russell point out that probably the best source of wood for the production of methanol will be forest waste -- waste that is now left in the forest and, as the member for Halton-Burlington pointed out, impedes good reforestation.

There is probably no accident to the fact that the member for Renfrew South proposed this project in the resolution before us today at this precise time. A group called Energy Pathways, which is located in his neck of the woods, recently got funding from the federal Department of Energy, Mines and Resources to do a regional energy study of Renfrew county. The conclusions of that study, though preliminary in nature, certainly indicate that a significant proportion of the energy used by residents and industries in Renfrew county now comes from wood and, furthermore, that it would be feasible to develop an even greater reliance on wood as a source of fuel in Renfrew county.

I think it is important to point out that while that may be true in Renfrew county, and while it may be very important in Renfrew county, it is not the kind of reliance we can look to in the urban centres of Ontario. I think it is important for the member for Prescott and Russell to acknowledge that, once urban development took hold in Ontario, the idea of fuelling our furnaces or our heating appliances with wood simply became out of the question because of the pollution it would create.

He has listed for us the many ways in which wood can be useful and some of the things the government has looked at. I suggest time would be better spent by the member for Prescott and Russell and the member for Renfrew South if they went after the government to make sure the projects it is listing for us these days will be undertaken and that the projects are designed actually to demonstrate that wood in its place and taken from the proper source can be a benefit, particularly in the provision of liquid fuels for the future of the Ontario economy.

4:10 p.m.

Mr. Cureatz: Mr. Speaker, might I say how pleased I am to be allowed the opportunity to say a few words in regard to this resolution. Indeed, I will follow the previous speaker in commenting that I am sorry the member for Renfrew South is not here and that we should give tribute to the member for Prescott and Russell in following through with the resolution. I know the whole House appreciates that very much.

I was greatly impressed when the member for Halton-Burlington opened up by saying this is a government resolution. Isn’t that cute? All the times I have been here during private members’ hour, I have heard time and time again the opposition over there screaming, “This is private members’ hour; this is for the private member.” The first thing the member for Halton-Burlington does is stand up and say, “This is a government resolution.” I say to him, for shame.

Mr. Kerrio: That’s what it is. It’s a government resolution.

Mr. Cureatz: Listen to the member for Niagara Fails (Mr. Kerrio) with all that hot air. Is that going to be the replacement? The member for Halton-Burlington was wondering if I was in support of this resolution. Indeed I am. I am a firm supporter of Ontario’s nuclear electric program as the member well knows, and we trust we will see him down the select committee on Ontario Hydro affairs in about 20 minutes.

Each one, however small its contribution, has a role to play in the energy mix. I am convinced that wood in itself has a fairly important potential. It is one of Ontario’s most abundant resources. Surely it deserves close study to ensure we are exploiting it to the fullest possible degree.

I know there are a significant number of people living in this province for whom wood stoves remain a principal source of heat in the home.

It is interesting to note as well that even here in the centre of this large city, one of the most desirable features a house or apartment can have is a wood-burning fireplace or stove. In other words, we possess an abundant natural resource, and it is a renewable resource. To some Ontarians it is necessary, to others a pleasant addition to the home setting. To many, it is even regarded as a luxury.

There are some questions we must ask in this regard. How much do our energy planners know about wood? How much are we using and how much could we be using? Can wood be in any way a substitute for imported oil? Could we be using it more efficiently? These and a number of other questions come to mind.

Mr. J. Reed: How does the member for Hastings-Peterborough (Mr. Rollins) feel about it?

Mr. Cureatz: Indeed, the member for Hastings-Peterborough has brought this to my attention.

It is my belief that, even if wood accounts for as little as one per cent of our total energy supply, it is worth plenty of attention.

Motivated by the increase in the price of fossil fuels and by the aesthetic appeal of simpler lifestyles, there has been significant improvement in combustion technology in recent years. Work has been done to apply the most sophisticated of today’s technologies to all type of installations. These range from stoves and fireplaces for home heating to highly sophisticated, large-scale fluidized reactors for gasifying wood so that it can be used to fuel electric generating stations or to make methanol, which can be used as a gasoline substitute or supplement.

Far from creating a threat to the raw materials supply of our existing forest industries, the prospect of increased demand for wood for its energy value, wherever this may be feasible in Ontario, offers potential opportunities for generating new economic wealth and for promoting upgraded long-term forest management and utilization.

One of the first tasks of a subsidiary of the Ontario Energy Corporation dedicated to the full exploitation of wood as a fuel source would be to establish several pilot plants or prototype furnace installations to demonstrate the commercial viability and to monitor the economic benefits that might accrue from the large-scale program.

Obviously, too, we would want to encourage the full participation of the private sector. We would want this participation to be on a large enough scale to ensure the full advantages of economies of scale regarding all aspects and all phases of the fuel cycle, harvesting, transportation and distribution.

The established forest industry, primarily in the northern and eastern parts of the province, already uses mill residues to fuel lumber drying kilns and to provide space heating. Mill residue is being used increasingly to replace oil and gas as fuel to heat particle-board presses and veneer dryers. In fact, the pulp and paper industry, one of the province’s largest, is considered to be a prime candidate for total energy self-sufficiency. Communities such as Chapleau, Hearst, Kirkland Lake and White River would be excellent locations for compressed wood fuel such as that provided by the Woodex system. Experts believe, however, that while there is a great potential for increased energy production by the forest industry, there is not an adequate demand to consume the energy locally. Apparently, too, it is not feasible from an economic point of view to transport wood long distances for energy purposes. These are but a few of the many facets of the wood fuel cycle that this province ought to devote its full attention to.

While wood suitable for energy purposes is plentiful throughout northern Ontario, 93.5 per cent of Ontario’s population live south of the French and Mattawa rivers. Our energy needs are greatest in southern Ontario. Fortunately, there is an abundance of low-grade wood throughout the Algonquin and eastern regions and parts of central and southwestern regions of this province. Wood- combustion technology for large-scale applications is well developed and considered cost-competitive with oil and gas. There are undoubtedly a large number of facilities where the economic feasibility of various types of wood could be verified. In some cases, the addition of a wood energy system would not require a complete new boiler system. In other cases, the existing heating plant would be used as a standby backup system.

There is a need to compile a more complete list of facilities that are advantageously located with regard to available wood supplies and to detail accurately the type of heating system in place, its present condition the type and amount of fuel currently used, and the cost and practicality of adding a new wood-burning system or retrofitting the existing system. Cogeneration at these locations to provide for electrical needs, for example, to accommodate air-conditioning in the summer, should also be investigated, and there is more to come.

Mr. Mancini: The speech writers must have been busy over this last week.

Mr. Cureatz: Listen to the way the member opposite treats me after I supported him on one of the first private members’ bills in this session. There he is, sitting across on the back bench heckling.

While purchased firewood is far from being competitive with oil, rural Ontario, comprising an estimated 700,000 households, is experiencing an absolute boom in wood-heating systems. Airtight stoves and fireplace conversion units are being manufactured by the tens of thousands. New combustion (oil and wood or electricity and wood) furnaces or insulated chimney systems are being developed by a dozen or more manufacturers. Old wood cookstoves are being resurrected in great numbers, and there are more wood piles to be seen in rural Ontario than at any time since the Second World War. Most people have probably been motivated by a concern for energy security. Quite a number are convinced that firewood, in spite of its inconvenience, is a competitive fuel today. This is especially so if they have access to their own wood supply and cut it themselves. However, wood-heating systems create much higher flue temperatures than oil or gas furnaces, and there is the additional problem of creosote to contend with. Creosote is created by the hot wood tar in water vapour combining to form a highly flammable crystalline deposit in the chimney. Unless adequate care is taken to clean chimneys, a great many chimney fires can result because of the creosote.

Wood will not likely become a competitive fuel for urban dwellings because of transportation and handling costs. Even so, a considerable number of fireplace conversion units, and even wood stoves, are being installed to provide a measure of security against a possible future critical oil shortage.

The greatest attraction of wood is its plentiful supply. The socio-economic benefits resulting from more intensive research in wood as a form of fuel would include the creation of many thousands of new jobs in parts of rural Ontario. Decreased dependency on foreign-controlled energy supplies and conservation of foreign exchange used for oil purchases are two substantial additional benefits. To ignore such sources as wood, no matter how small their contribution, is to ignore a major natural resource in this province. As the member for Hastings-Peterborough (Mr. Rollins) has indicated to me, in the rural areas wood for fuel usage is in such demand that at present he has 60 single cords in his backyard.

4:20 p.m.

Mr. Mancini: Mr. Speaker, I am pleased to rise and participate in this debate. As we know, the resolution is calling for the full exploitation of wood as an alternative heat source in Ontario.

Before I address my comments to the actual resolution, it seems almost a coincidence that this past week I received on my desk an orange-coloured expensive brochure from the Minister of Energy (Mr. Welch) with a very lovely picture on page two. The Minister of Energy looks younger every day. I don’t know whether he has a person touching up these photographs, but they sure are doing a good job.

The booklet is titled Energy from Waste. Lo and behold, on Thursday of this week we are debating that very same issue: energy from waste. I want to bring that to the attention of the member for Carleton-Grenville (Mr. Sterling), who is a member of the procedural affairs committee along with myself and the member for Essex North (Mr. Ruston). Time and again, the member for Carleton-Grenville has told the procedural affairs committee that the opposition uses private members’ hour to state party policy.

It is rather a coincidence that after having received this nice-looking orange document -- and that’s all it is -- we are today debating how we can possibly exploit wood as an alternative heat source in Ontario. I want to file that away for everyone’s attention, especially that of the procedural affairs committee.

I took a lot of delight in reading this brochure today. This is the foreword from the Minister of Energy -- and the member for Durham East (Mr. Cureatz) will note that I did not have any highly paid civil servant write my speech for me. On page two, the Minister of Energy says: “The production of synthetic liquid fuels may become practical in the longer run.”

What type of hoax is this? We have a member standing up today telling us that we can exploit wood immediately as an alternative source of heat and fuel in Ontario, and in the government’s document the Minister of Energy says “may”: We may be able to use synthetic liquid fuels; it may become practical in the long run.

This is another example of the Ontario government spending money to produce nice- looking booklets but having no intention of doing anything about the real problem. We in the Ontario Liberal Party have proposed a document of how this government could take the lead in Ontario and how we could use methanol and other liquid fuels to displace the oil we are importing, because it is evident to everyone, even to the government.

Their own booklet says, on page five: “Energy from outside Ontario constitutes 77.4 per cent of all the energy that we use.” They go on to state in their brochure that this outside energy is mainly oil. So the conclusion is that we don’t have an energy problem; we have an oil problem. We have to displace the use of oil. We don’t need orange booklets and brochures, printed at great expense. We need action from a government that has had 37 years to take action. That’s what we need: action from the government.

It is interesting that the member for Hastings-Peterborough recently issued a press release condemning the study of methanol. That particular member stated some extraordinary figures of how much methanol would cost to create. Then we have the member for Carleton-Grenville, another eastern Ontario Conservative member, trying to take credit for this whole thing about synthetic fuels.

Mr. Gaunt: He’s the methanol champion.

Mr. Mancini: He’s the methanol champion in eastern Ontario. I think the member for Hastings-Peterborough and the member for Carleton-Grenville should get together before they issue their own press releases.

This is another example of how lackadaisical the government is about this serious energy problem. We import most of our energy source, which is oil. There is terrible disruption in the world today in the Persian Gulf where most of the oil comes from. Yet this government of the largest province in our country, the province with the most people, with the largest tax base and with all types of financial and people resources, instead of taking the lead, presents us with another brochure. Every time there is a problem in this province we receive a brochure on our desks.

On page 20, there is some important information that must be read into the record. It deals with the Ontario Energy Corporation. I am going to quote what the government says on page 20 of its brochure. “In order for the OEC to consider investing in energy fuel wastes” -- and they have come up with snappy initials, EFW. That is one thing the government is good at. Any time there is something that has to be given a name, they are good at that. Today we received a statement from the Chairman of the Management Board of Cabinet. He has something he calls MBR, that is, management by results, whatever that means. Anyway, this is typical of a tired old government. All they can do is come up with brochures and snappy titles.

Let me continue. “In order for the OEC to consider investing in an EFW project, the following general conditions should be satisfied” -- this is what the Ontario Conservative government says -- “a reasonable rate of return for the OEC is expected ... ”

We are in the middle of a crisis. We import 77 per cent of our energy resources, and we have a government that is worried about whether the Ontario Energy Corporation can make a profit or not. We must be concerned about supplies; that’s what we must be concerned about.

Going on reading from the government brochure, “The OEC will normally only offer to take a minority position in the project.” We can see just how serious the Ontario Conservative government is.

Let me continue. “A sound ownership and management structure must be available and an experienced operator involved.” How can we expect experienced operators to be involved when we are talking about new things that are going on, new things we want to develop? Where is the leadership over there? They are supposed to provide the experienced operator. They are supposed to be assisting, not taking a minority position. They are supposed to be creating a secure source of energy, not worrying about whether the OEC makes a profit.

I have more to quote if you will allow me, Mr. Speaker. On page two, under the photograph of the Minister of Energy, it says, “Waste not, want not.” Those words never meant more than they do today.

4:30 p.m.

Mr. Samis: Mr. Speaker, I rise in support of this resolution. As the member for Carleton East (Ms. Gigantes) said, with considerably greater impact than any of us would ever have, it is obviously a motherhood resolution. I don’t know how one could oppose it.

Coming from eastern Ontario, I have a specific interest in this resolution. I think this resolution speaks to a deeper problem, which is the question of supply and demand in the whole energy field, In this province we are becoming increasingly vulnerable because we import some of our major sources of energy from other provinces or other countries: coal from Pennsylvania and oil and gas from Alberta and Saskatchewan. That dependence on outside sources of energy, and our lack of control over any of the prices, puts our manufacturing industry in an increasingly vulnerable position and makes our competitive position vis-à-vis the United States that much more difficult.

We may have the dependability of supply, but the cost factor is making it increasingly difficult for small- and medium-sized businesses and manufacturing sources to compete or to reduce their energy usage as much as possible.

We have some indigenous sources of energy in this province, and the nub of this debate today is how effectively and efficiently we are making use of those sources. I believe a strong and effective conservation policy is extremely important in the overall discussion of energy usage and alternative sources of energy.

The New Democratic Party proposed a seven-point program last fall to improve energy conservation in this province. This is probably the best investment our provinces can make in terms of energy, because the more we can save, the less we have to spend, whether it is in research or acquisition.

That program comprised seven points outlining where we could reduce energy consumption. Those points were: (1) a comprehensive home insulation program based on the model developed in Saskatchewan, (2) building codes that would include energy efficiency standards, (3) a far greater emphasis on mass transit, (4) a system of rate structures within Ontario Hydro that would encourage conservation instead of consumption, (5) far greater involvement in and commitment to solar energy as an alternative source, (6) a firm determination to stop the $5-billion Darlington nuclear project and, (7) an expanded role for the Ontario Energy Corporation, especially in alternative renewable sources, methanol in particular.

The former leader of this party made some specific proposals in regard to methanol in the 1977 election campaign. We want to see the role of the Ontario Energy Corporation expanded as a sponsor of research and development, as an investor in fields like methanol and other fuels, and as a financing vehicle for our conservation programs. The government has failed to give the OEC the leadership and funding it needs to meet the energy needs of the province.

Methanol interests me as I come from the segment of eastern Ontario directly involved with the Edwardsburgh project. I was interested in the views of professor Morris Wayman of the University of Toronto, who did a report for the Porter commission, entitled “Wood-Fired Electrical Generation in Eastern Ontario.” He identified about one million acres of marginal or abandoned farm land in eastern Ontario which could be used for an energy forest of fast-growing poplar.

According to Professor Wayman, the development of a 1,600-megawatt wood-fired generating capacity in eastern Ontario “would create employment for about 10,000 people during the 15 or so years in which the plantations and the power stations are constructed and, thereafter, for about 3,200 or 3,600 people continuously. The wood supply operation alone would generate $170 million in annual cash flow into the region.”

Perhaps the best development strategy for eastern Ontario would involve rapid development of the poplar plantation with a view to three end-uses: electrical generation, methanol production and providing additional raw material for a pulp mill at some point in the future.

It should be noted that a pilot methanol plant would require about 825,000 oven-dried tons of biomass a year, according to Professor Wayman. Depending on the yield achieved, this would be produced by about 85,000 acres of energy plantation, less than 10 per cent of the available land, so wood-fired electrical generation and methanol production are clearly not mutually exclusive uses. If natural gas were initially combined with wood for the feedstock for methanol plants, as recommended by the intergroup study, the acreage would be even less. Similarly, mixing wood with coal or residual oil would permit more electricity to be generated at eastern Ontario plants.

I know there was a time when people said methanol just wasn’t feasible, that it was in the far distant future. I recall reading about Arthur Johnson, the executive co-ordinator for technology for the Ministry of Energy who was saying it was going to be 15 years or more before the growing scarcity of oil and natural gas made methanol an attractive substitute. He was quoted saying, “That day must come, however.” He said methanol would not be competitive until the production price of oil at least doubled.

It is interesting to note that since 1977, the international price of oil has gone beyond the $32 mark, and in 1977 the OPEC price for a barrel of oil was $12.70.

In contrast to Mr. Johnson’s initial pessimism, a federally sponsored review led to conclusions that were quite different. They enthusiastically supported the development of a Canadian methanol industry. They suggested that an investment of $2.5 billion to $3 billion would yield production facilities up to three billion gallons a year, using forest wastes and natural gas as joint feed-stock.

Between 14,000 and 20,000 man-years of employment would be generated in the construction, and up to 25,000 more full-time jobs after that.

I am not suggesting methanol is any sort of panacea for energy problems, but its day of feasibility has obviously arrived. The time has come for us to get much more deeply involved in terms of research and development. The preliminary overview report by Donald MacKay and Russell Sutherland was done for the Ministry of Energy in 1978. On page 77 their conclusions are listed: “On the basis of the presently available information, it appears that the use of methanol as a gasoline blend is sufficiently attractive, technically and economically, that it merits further investigation as follows ... ”

They talked about the price factor, et cetera. They say: “Implementation of methanol as a fuel has been discussed, and it is concluded that substantial gasoline replacement could be accomplished by the mid- to late 1980s, depending on the effort devoted to its introduction. Clearly, the provincial government must play a leading role in the introduction process. A co-ordinated federal-provincial research program is suggested.” Their final paragraph on page 79 states:

“It thus appears that the cost of methanol synthesized from waste is competitive with gasoline, especially if no tax is levied on the methanol. If, as is claimed, the methanol has equivalent efficiency on a volume basis, i.e. better energy efficiency, then the process is very attractive and is one of the most promising initiatives that can be pursued in Ontario.”

In concluding, I want to say that we in eastern Ontario have an obvious and vested interest in the development of a meaningful methanol industry in the province. I want to emphasize that the time has come to end our dependence on oil and nuclear, to the exclusion of other fuels. We need to diversify our mix of fuels as much as possible. Wood is an intrinsic source of energy in this province and we must explore every avenue available in terms of energy sources.

I support the resolution and can only lament that this type of action with regard to wood has been so slow in coming. We in eastern Ontario want to see far greater emphasis on the development of wood sources and methanol conversion. We want to see the full potential of methanol, ethanol and other alternative sources of energy developed as soon as possible by the Ontario Energy Corporation and the private sector. The resolution is certainly worthy of support, but the record of the government in this regard has certainly been lamentable and lackadaisical.

Mr. Sterling: Mr. Speaker, as the member from the area that is deeply involved in the methanol study, having been interested in that subject for more than a year, and having approached the government in the summer of 1979 in bringing this forward, I couldn’t agree more with many of the comments made by the member for Cornwall (Mr. Samis). I think it only fair to point out, though, that the government has not been lax in terms of looking into this matter. If members go back over the reports that have been paid for by the various ministries in our government, they will find there are many dealing with wood as a fuel and an alternative source of energy.

4:40 p.m.

Mr. Acting Speaker: The honourable member’s time has expired.

Mr. Sterling: I would like to add my support to this very worthwhile resolution. I think the debate on energy this afternoon has been worthwhile, although it has been of a motherhood nature.

Mr. Acting Speaker: The time for debating this item has also expired.

EXPENDITURES DISCLOSURE ACT

Mr. Peterson: Mr. Speaker, let me say how very happy I am to --

Mr. Acting Speaker: Would you move second reading?

Mr. Peterson moved second reading of Bill 35, An Act respecting the Disclosure of Tax Incentive Costs.

Mr. Peterson: Mr. Speaker, my apologies for forgetting the procedure. It has been so long since I have had an opportunity to introduce a bill that I completely forgot the protocol. I apologize for that.

I must say I am happy to be here again to contribute my few thoughts on an issue that I think is significant. Unfortunately, it is not a well-understood issue, but I will try to impress on my worthy colleagues from all sides of the House that, at least in my judgement, we should be taking action.

Contrary to the actions of a lot of my colleagues from all parts of the House, I have chosen to bring in a bill rather than a resolution. I am one of those who have become somewhat disillusioned with the process of private members’ business and the introduction of resolutions. They have become all motherhood because nothing happens to them. Theoretically, they should represent the weight of opinion of this House and they should have at least a strong moral force in the creation of public policy. But we have seen so many of those resolutions be well debated, and then die and nothing happens.

That is why I decided to bring forward a bill that is going to force various members and various parties to address the question very specifically. When I say that, I say I very much hope the worthy members opposite and to my left will consider this of significant enough public importance to work with me to bring this to fruition.

One of the very serious problems we face today is the scrutiny of the expenditures of government. There is a myriad of people working on this question. We do it through the estimates procedure, which happens after the fact and turns out to be an analysis of expenditures that have already been made. It has turned out, at least in the functioning of this House, to be just a forum for various members to make various policy statements or to carp and complain in general or specifically about things that disturb them. It has not functioned and is not functioning as a scrutiny of legislative expenditures. I think, that is a reality. We also use the public accounts committee, but that is too late. It is a post-audit, a year or two after the fact. We try to call in the relevant people, but so often the harm has been done.

One of the great frustrations for all members -- and all members from all parties are concerned with efficiency and economy in the government today -- is the standards upon which and against which one measures efficiency and economy in government. One of the fundamental reasons I brought forward this bill today is to force the government to create standards against which it can be judged. It is only one part of the process.

Mr. Speaker, you will recall that in the past I have introduced bills in this Legislature to force an economic impact study of every bill and every regulation that comes before this House. That is a big job, but at least it would force the bureaucracy arid the politicians who introduce that legislation to figure out the effect down the line, to have something in mind when they produce that legislation. If it did not turn out as expected, we would have something against which to judge it. That is one of the reasons for my bill: to try to bring in some scrutiny of tax expenditures.

Another reason is freedom of information. I want to be charitable, but I suspect the government has an economic impact study of various pieces of legislation or tax expenditures. But the opposition, other members of the Legislature, the government backbenchers and, indeed, members of the public are rarely privy to that information. When we are in this time of great revenue crisis and expenditure crisis at all levels of the government, when we have an increasingly disaffected populace that is worried about its own taxation rights in a flat economy, we must attempt far more seriously than we have already to justify ourselves on the expenditure of public funds.

It was a depressing Auditor General’s report from Ottawa that was published in the press today. Mr. Macdonell talked about the efficiency of the civil service and a number of other problems. He addressed in a generic way some of the things I have been trying to address through this bill. I offer it not as a universal panacea but as one very constructive way to discipline government. We can analyse government and establish a set of standards against which all members of the public can participate in the debate on whether a tax expenditure is worthwhile.

Let me explain what a tax expenditure is. It is a benefit conferred upon someone, a company or an individual, by not collecting the full amount of revenue to which we would ordinarily be entitled. It is a tax concession, which can take many forms. But it is some kind of a benefit that is conferred upon someone for presumably some other kind of purchase.

It is very important when we are under the expenditure restraints we are under today to make sure we are not giving away more by way of tax expenditure or benefit conferred upon one group than we are cutting back from another group. If there were no tax expenditures, we would take all that money into public Treasury and then have the option of giving back grants to the very same people we are trying to confer a net benefit upon. But one can imagine the public howl that would arise if people saw us giving back the kinds of grants and the billions of dollars that tax expenditures are worth today in this province.

One of the problems I have in bringing this debate forward is that we have so little information in Ontario. I have taken my lead from the federal government, which has published two studies on tax expenditures. I went through these studies. The Department of Finance published one which lists 186 ways that individuals and corporations get preferential tax treatment, i.e., benefits conferred upon them by the government for certain types of behaviour. They are the most bizarre, arcane, obscure kinds of things. I certainly do not want to take up all my time going through the list. In almost every area, we have devised a complicated tax system that gives certain amounts away to certain people. In the manufacturing sector we have certain lower income tax rates on manufacturing. We have investment tax credits. In energy we have certain tax credits. In the resource sector the oil and gas drilling fund. There are multiple-unit residential buildings (MURBs), and there are tax advantages to individuals for shoes and for all sorts of different things.

Until recently, these things had never been catalogued. The study by the Department of Finance of the federal government came up with a figure on an annualized basis of $32 billion given away yearly by way of tax expenditures. I am not making a judgement on the worth or the relevance of those tax expenditures, but I am saying we have the right to know so we can make that judgement.

That study showed something like $32 billion in tax expenditures at the same time as there is a public outcry about the size of the federal deficit, some $12 billion. If we cut the tax expenditures in half, we could at least balance the budget if that is the primary aim.

4:50 p.m.

The problem with tax expenditures is that they are obscure and hidden. Very few people know what is involved. They clearly know when a government grant is given out to Abitibi or to some poor people for mortgage interest rate relief or that kind of thing, but a tax expenditure is hidden in the system. It is the greatest single potential source of revenue, yet nobody knows it. In order to have a full debate on this subject, we must have the information.

I refer to another study, by Roger Smith for the Canadian Tax Foundation, which came to very different conclusions. He said the federal tax expenditures were in the order of $10 billion. But there were different time periods used and there were different criteria used, because I can assure members that the definition of a tax expenditure is not an easy one. I haven’t attempted to deal with that in a complicated way, other than to say we must apply the full force of government weight to determine what is involved.

I take you back three years, Mr. Speaker, when you will recall an amendment to the Retail Sales Tax Act was introduced by Darcy McKeough to provide a fast write-off or tax exemption for production machinery. Our friends to the left opposed that at the time. We supported it, but we were very concerned that there wasn’t enough information to make an intelligent judgement and so we introduced at that time an amendment to that bill, forcing government disclosure. It was not exactly the way I would have liked it because it was government disclosure after the fact.

The amendment which I moved to section 6 then read “Not later than January 1, 1978” -- the year after the implementation of the bill -- “the minister shall cause a review to be made respecting the impact on public revenues, job creation, unemployment and investment growth in the productive sector of Ontario resulting from the operation exemptions created by paragraphs 38 and 38(a).”

The point was that, through the strength of the opposition at that time, we had the power to force the government to analyse its own work, and that is the way it should have been. But where this failed is that we should have forced the government to analyse that ahead of time. We should have known why that bill was introduced, whom they expected to benefit positively and whom they expected to be affected adversely so that we as legislators, either in the House or in committee, could come back a year later and say: “This is what you said would happen. Here’s what did happen. Either you were wrong or you were right.” Then we would collectively make a social or moral judgement about the efficacy and correctiveness of that action.

Anybody who thinks financial matters are too esoteric is wrong, because ultimately they reflect the social, political and moral values of a society, and numbers are just one way of translating them. When we morally take the position that we are going to confer a benefit on one sector of society by giving it a tax advantage, but at the same time we decide not to help another sector of society, then that ultimately is a moral or political judgement. We have to have those numbers and we have to have that information in order to explain intelligently what we are doing and in order that we, the legislators, can understand.

I want to quote Roger Smith, the author of the Canadian Tax Foundation study. He said: “Very little may be gained from the control of direct expenditures if the process is accompanied by rapid growth and indirect expenditures which are subject to no public accountability.” They are hidden. Almost every group in society is asking for preferential tax treatment: a special fast write-off for research and development or for school tuition fees or whatever. Before governments accede to that pressure, given the revenue squeeze I said earlier they are all in, the tremendous pressure to balance budgets and the adverse effect that is having on our society in the long term, then we must look at all forgone revenue sources before we can look at giving away and spending more money.

It is very easy to advocate further tax incentives, but when one thinks about it in terms of giving the person a grant, as opposed to just forgiving revenue, then that brings a very different kind of perspective to the question that one advances.

I have a personal example. I received a letter today from a person in the furniture business in Ontario. He manufactures furniture for hotels and he was quite disturbed. He told me about a motel in Morrisburg which just received a preferential tax treatment because, as members know, motel and hotel equipment is exempt from retail sales tax. That equipment, bought by him to the tune of $48,000, was all imported. He tells me, and I take it at face value, that equipment could have been produced in Ontario at competitive rates. There is another motel in Belleville with the same thing to the tune of $65,000. It was brought in and given preferential tax treatment.

There are a number of competing interests here. We are interested in hotels. We want to treat them as favourably as we can from a tax point of view. But are we doing the right thing morally when we subsidize them to purchase furniture and accessories from a different country?

If we had that information, we would be far more capable of making rational judgements. That is why I have introduced in this House today a bill to force the Treasurer (Mr. F. S. Miller), when he tables his budget, to make a complete documentation of his tax expenditures -- what he expects to glean therefrom, who he expects will be positively affected, who he expects will be adversely affected -- so we can better make not only the moral judgement, but also the political and economic judgement, about what is correct for this province.

I hope I have impressed upon the House the extent of this problem. It is not a front-page item. It is not going to get people marching in the streets tomorrow. Unfortunately, one of the failures of the legislative process -- I think we collectively share in this problem and I take my share of the blame -- is that we are rarely able to elevate the significant and fundamental long-term issues to a place of public prominence on the Order Paper.

I think this is an important issue in the long term. I ask members of the Legislature to assist in providing better information for the people of Ontario for us to govern better, to pass better laws for the benefit of all Canadians.

Thank you, Mr. Speaker. I assume I have some time left.

Mr. Deputy Speaker: There are four minutes remaining. Do you wish to reserve that?

Mr. Peterson: Yes, Mr. Speaker.

Mr. Young: Mr. Speaker, let me congratulate the honourable member for bringing in this bill and for the way in which he handled the introduction this afternoon. What he said is something with which the members of this group could agree almost totally, because we feel that he has shown us exactly what this problem needs.

This afternoon I am not going to outline the various types of tax expenditure. The member has already told us we have a total of $32 billion a year on these tax expenditures, a rather startling sum.

I want to look at a couple of types which are very much in the public mind, ones which should be looked at carefully.

The first is the rapid write-off where, for whatever purpose, government gives to corporations, individuals or companies the privilege of writing off the value of the new machinery and equipment in one or two years. In other words, the government itself pays for it quickly instead of by a long-term write-off, which is customary with business. As the member has pointed out, we don’t know what this is costing Ontario.

The Smith report -- to which he has referred -- points out that in 1975 we had a total of $1.5 billion in rapid write-offs. If that was the case for 1975 -- it has been used much more adequately since that time from the point of view of the companies -- then this must have cost the government billions of dollars. But we don’t know what this has cost Ontario. It is the purpose of the bill to find that out, and we hope that will happen.

5 p.m.

A couple of figures have been given to us. I quote Eric Kierans, who is hardly a Socialist but I understand he is a good Liberal. He says this: “Eighty-nine per cent of the so-called accelerated capital cost allowances went to firms with assets in excess of $25 million, about 400 firms. Those 400 firms constituted 1.2 per cent of the total corporation population. The other 98.8 per cent of the firms, about 300,000 companies, shared the remaining 11 per cent of tax deferrals.” That shows us something of what is happening in this field and I will come back to that later.

The second matter I want to bring to the attention of the House is deferred taxes -- taxes which would normally be paid by a company, a corporation -- individual or international, whatever the case may be. Those taxes pile up year by year as a liability on the books of a company, with the idea that they must be reinvested as they get them or shortly afterward.

Deferred taxes in 1970 in Canada amounted to $3.6 billion; by 1975, $10.5 billion. We don’t know the exact figure for 1979, but I have seen two or three estimates in the range of $15 billion. That means deferred taxes account for almost half the amount likely at the present time that the member just quoted. The rate of increase in these deferred taxes is going on and they represent now up to 12 per cent of the capital in many of our companies.

These are a couple of illustrations: In the mining companies, nine per cent of the capital is now in deferred taxes, or at least deferred tax equals nine per cent of the capital; in primary metals, it’s 12.4 per cent; in petroleum and coal products it is 12.8; and the average is eight per cent in the manufacturing sector. But compared with those, in the retail trade, the small businessmen, we get 1.5 per cent which is pretty small, and in the wholesale trade, 1.6 per cent. So there is a tremendous imbalance there in what is happening.

Let me give a couple of examples: Bell Canada, one of our largest and most respected companies, has deferred taxes in its last report -- I have it here -- of $1,066,749,000. That has accrued over the years, and that is what Bell Canada owes government treasuries, wherever they may be. Again, one doesn’t know what part of that Ontario has, and that’s the purpose of the bill: to find that out. Northern Telecom, a wholly owned subsidiary of Bell, or close to it, has deferred taxes of $90.9 million; Inco, $466 million; Algoma Steel, $44 million; CPR, $500 million.

That’s not the whole story. Bell Canada has that money, as all the companies do, interest-free. So we are not only making capital funds available to the corporations in Canada, but we are also making it available interest-free. At 15 per cent, and that’s low today, Bell Canada would be paying $160 million to the public Treasury in interest alone. That means an extra subsidy this year to Bell Canada of $160 million. It means an extra subsidy to Inco of $70 million at 15 per cent. It means a subsidy to the CPR of $75 million this year. And that goes on year after year, increasing as long as the interest rate stays that high. If the interest rate goes down, of course, the subsidy is a bit less. What is Ontario’s share of these deferred taxes? We just don’t know, and so we are very interested to find out.

I want to mention three or four things that are happening because of the situation I have outlined. First, as the figures I have quoted show, this whole matter of deferred taxes and all the rest of the tax expenditures on the part of government favours the concentration of wealth and economic power, because the biggest ones get the most and the little ones get little. Of course, the more they get, the more the interest-free part adds up.

Second, it favours largely American-owned firms in this country, firms which produce rubber, autos, petroleum and chemicals and which are largely owned, if not almost wholly owned, by American head offices. That means we are assisting the expansion of American control in Canada through this device. We give them the money to buy us out. That is really what is happening. To me, that is incredible. We should know to what extent this is happening, because we do not know today. Again, it works against the small business.

We talk about help for small business, and we have set up various devices for assisting small business in this province; so what do we do? We hit them hard through the taxation setup. Of course, it also militates against the new business, the little fellow who wants to get started. Until he shows a profit, there is no help for him.

Do I have one minute left, Mr. Speaker?

Mr. Deputy Speaker: Yes.

Mr. Young: I will have to leave most of it to the member for Nickel Belt (Mr. Laughren) to fill in, but let me say this: The thing that disturbs me most about this whole business of tax expenditures is that we have been talking about restraint. The Duke of Chatham-Kent, Darcy McKeough, instituted a program to transfer wealth from the public to the private sector some years ago, and said so in so many words. Our gross national product has not been dropping. What we have been doing is transferring from people help, to corporate help, and to the help for the wealthy in our community. The kind of thing we want to know is to what extent that transfer is taking place? We’re cutting welfare, child care, education, medical care and all those things. At the same time, we are increasing the help in the field of tax expenditures. To me, that is wrong. That’s the wrong place to put the restraints.

Mr. Williams: Mr. Speaker, I’m pleased to have the opportunity to speak to the bill of the member for London Centre. (Mr. Peterson). It is always a pleasure to consider the ever-shifting sands of that amorphous body of political thought known as Liberal economic policy. I think I am being accurate when I characterize Liberal economic policy as a body of thought; however, the bill being proposed by the honourable member may be cast out on that description.

Indeed, this bill, the Tax Expenditures Disclosure Act, 1980, seems to suggest that the Liberal Party and its economic researchers are totally unaware of what information is available on the costs and consequences of tax deductions, exemptions and rebates. Perhaps this lack of awareness of available data and the apparent inability to analyse and understand the information are the underlying causes of the continuing lack of consistency in Liberal economic policies. In any event, I will be opposing the bill for reasons which I will now expand upon.

Speaking generally, complete and detailed information on the objectives, amounts, implementation and anticipated costs of government programs have always been provided by this government. In a few moments I will list just some of the sources of information available to anyone who seriously wants to examine government tax and fiscal policy matters.

However, before doing that, I want to consider a specific example of what this bill is about. I refer the members of this House to the temporary Ontario tax rebate program which this government put in place only a few months ago. This program was announced on January 31 by my colleague the Minister of Treasury and Economics (Mr. F. S. Miller).

As members will recall, its purpose was to provide assistance to the automobile industry in Ontario specifically, to stimulate production in the industry and to reduce the number of employees in the industry on layoff at that particular time.

5:10 p.m.

At the time he announced the program, the Treasurer, in conjunction with the Minister of Revenue (Mr. Maeck), provided information outlining in detail the objectives of the program, the procedures involved and the actual estimated cost of the program. Specifically, the estimated costs were stated to be up to $15 million, depending on the number of 1979 cars sold in February.

I recall that the Liberal response to this program was not very constructive. When given the information concerning the cost to the government of this program, about the only thing the Leader of the Opposition (Mr. S. Smith) could think to say on the subject was that it was a giveaway to the dealers. That was not a very useful analysis. In fact, about 7,000 vehicles were processed under this program. Dealer inventories were reduced by at least a third. The actual cost was much less than the $15 million originally projected. The complete financial information provided on this program was not just an isolated case -- far from it.

I want to turn now to consider certain aspects of the 1979 Ontario budget. I have reviewed that budget for examples of tax deductions, exemptions or rebates to see if adequate supporting information was provided. I am convinced it was.

The retail sales tax exemptions on certain candy, confections and soft drinks were clearly stated to cost $16 million. The exemption on ticket prices was increased, as stated, at an annual cost of $1 million. Purchases of aircraft and aircraft parts were exempted from sales tax for certain carriers. Costs to the province were estimated to be $4 million. Further sales tax exemptions and rebates were allowed on materials relating to solar heating, smoke alarms and certain household clothing items at a stated cost of $6 million.

Without going into further detail, the estimated costs were clearly set out for the tax reductions affecting tourism, the capital tax and the elimination of succession duties. The budget contained a table entitled “Revenue Impact of Tax and Other Changes, 1979-80,” which outlined in detail the effects of the various deductions, exemptions or rebates. In every case, the cost to the province of these actions was clearly stated.

It appears I have embarrassed the sponsor of the bill, Mr. Speaker, because he has left the chamber now that I have brought these matters to his attention. As every member of the House knows, with the exception perhaps of the sponsor of the bill, the budget is tabled with a series of appendices and budget papers at the back. Contained in the appendices are tables, charts and detailed information concerning any tax changes and outlining revenue and expenditure levels over the preceding years. One only has to look at the budget document to show that more than half of it contains these detailed appendices and revenue information.

Even a cursory examination of the budgets from 1976 through to 1979 would indicate that in each and every case where a tax reduction, exemption or rebate is contemplated the estimated cost to the province is clearly stated.

Further, if the material provided in the budget is somehow not enough for the member for London Centre -- and I question whether he has ever read the appendices and supporting material in the budget, based on his presentation -- I suggest he examine some of the other financial information published regularly by this government.

The member alluded to -- I don’t know whether he has ever read them -- the annual three volumes of Public Accounts of Ontario, which I hold before you, Mr. Speaker. Has he referred to the quarterly updates on the performance of the budget, prepared by the Ministry of Treasury and Economics, or has he taken the time to look at the annual publication, Province of Ontario Financial Report?

These are all supporting documents that set out in detail the pluses and minuses in budgeting and granting of tax exemptions or credits. All these publications are clearly detailed with tables and charts for the very purposes for which the member is concerned in this bill. It is my position that ample and appropriate information is made available by this province concerning tax and fiscal policy matters.

Before concluding, however, I wish to give a final example to illustrate my position. Members will recall that in 1975 this province took measures, including a reduction in the retail sales tax, to reinforce consumer purchasing power and to stimulate the automobile industry at a time when the Ontario economy was experiencing significant economic slowdown. The actions taken included a reduction in the retail sales tax from seven per cent to five per cent, removal of sales tax from certain machinery and equipment purchases and a rebate to consumers of the sales tax on new car purchases. The total cost of these actions was clearly set out in detail as $590 million in 1975-76.

The 1976 budget analysed the effects of the 1975 reduction and included figures, tables and other information for anyone who cared enough and was concerned enough to assess the impact of these temporary measures in terms of increased economic activity created in Ontario. Charts were presented to show how the benefits were spread among consumers, industry and other sectors of the economy to show the change in the value of retail trade, to show the changes in sales of autos in Ontario and to show increased Canadian passenger car production as well as tables dealing with other matters.

I believe I have indicated that relevant information is made available to the public to allow for serious and informed criticism of government policies. I further believe that the member for London Centre is fully capable of making very good use of the data already available and that his time would have been better spent offering constructive criticism, valid or otherwise, or well-documented tax incentive programs, rather than formulating this redundant piece of legislation.

Mr. Speaker, in good conscience, for the reasons stated, I am not able to support this bill.

Mr. Ruston: Mr. Speaker, I wish to take part in this debate and support Bill 35, An Act respecting the Disclosure of Tax Incentive Costs. I think it is important when one sees the way the bureaucracy of government builds up and the tax structure we are facing today and how governments at times bring in special incentives to do what they think may improve the economy.

I suppose we could look at the recent removal of the sales tax for all 1979 model cars in dealers’ showrooms for the month of February. If I had been a dealer and had 100 cars, I would have thought that was great. But if I had been another dealer down the road, with no 1979 models and a hundred 1980 models, I would have thought that was absolutely ridiculous. Actually what the government was doing was encouraging the sale of the 1979 model cars that had already been manufactured. Some dealers made a bad mistake by not selling them, not putting on a little more pressure, maybe giving a little discount on them, and they hung on to them; then they got rid of them with the government’s assistance. Yet the fellow who sold them, who really got out there and peddled them, leased them, sold them or whatever he did to get rid of them and brought in all his new 1980 models, did not get any benefit.

The government was not helping the economy. If it wanted to help the economy, it would have taken the tax off the 1980 models; then the dealers would have had to buy the 1980s to sell them and they would have had to peddle the 1979s some way, perhaps by reducing the price, but at least they would have sold them. So the government was not helping the economy, if that was the intent.

An interesting thing happened in 1975. They took the sales tax off automobiles and came out with a $1,500 grant to home owners -- which was kind of a nice thing for someone buying a home, whether new or used, as long as he was a first-time home owner.

5:20 p.m.

A person came to me the other day who received a $1,500 home owner grant in 1975. His mortgage was written up for five years. The government encouraged him in 1975 to buy a house, and now he is in a fix, having to pay a higher mortgage interest rate. It just happened, of course, that interest rates went up over the five years. When he renews his mortgage, the $1,500 will not look very good. It would do him a lot more good today than it did in 1975. What government does sometimes causes an effect over a few years. It may cause many problems later that were not expected. That is why the member for London Centre is correct in saying we need an assessment when we are giving benefits by removing taxes on whatever it might be.

If we look at the record of 36 years, eight months and 14 days of a tired old government -- and I have been here almost 13 years -- we can see that they are getting more tired and more tired. This session they have been even more tired; they really are wearing down. In fact, the Premier (Mr. Davis) never answers a question any more. He looks for interjections from somebody so he can play with them rather than give an answer to a question. It shows how tired he is. I realize that does not concern this bill. However, we are addressing a bill though this government that should be accepted.

The member for Oriole (Mr. Williams) gave his reasons. I can understand the general philosophy of the member for Oriole. I am sure he would not accept this because he feels that the government over there is the only one that can do anything right, and no one else has any right to know how the government figures it out and how it comes to its assessment. That is the philosophy of that party over there. I say that day is gone and they are going to have to change their ideas because they are going to be kicked out.

The member for Oriole mentioned something about what the member for London Centre read from the public accounts book. Many of us have read it. I have been reading the public accounts books for the past 12 years. It is interesting to look at the public accounts books of 1968, 1970, 1972 and right up to 1979. I looked under Education in the book for 1970. At that time the individual salary limit was $15,000; in 1970, your name had to be put in if you earned $15,000 or more. Of course, it has been raised because of inflation, and today it is $25,000. But there are still as many in that high bracket -- more than 600 who are earning more than $25,000 in the Ministry of Education headquarters here in Toronto.

When the present Premier presented the education bill in 1968, to put all the boards into county boards and centralize the school districts, he said the local boards would be handling all the business; they would look after education. They are looking after education. There are no inspectors from Toronto going into every school every week or two as there were when I attended school. They used to come from Toronto and look around see how we were doing. Nobody comes from Toronto now. They have 600 people here making more than $25,000 a year, and nobody knows what they do. The present Premier, when he was Minister of Education, said that by putting in central education boards, by taking in county boards in big areas, we would not need all the bureaucracy in Toronto. That never happened; we still have them.

That is why we must have something like the member for London Centre mentioned. We need the approval to get in there and control the spending of the bureaucracies that build up. Of course, the present one has to be the worst. After 36 years, eight months and 14 days, what else can we expect?

Mr. Laughren: Mr. Speaker, I think most of us are going to support the bill, not that it is quite perfect. I think there are a couple of minor imperfections.

Mr. Peterson: Just like you. You’re not perfect either.

Mr. Laughren: My imperfections are not minor, but the bill’s imperfections are minor. I am concerned about some of them because the bill states that the costs contained in tax expenditures in the budget should be tabled with that budget. That is grossly inadequate, because it doesn’t deal with any of the existing tax expenditures at the provincial level. It only deals with changes to the existing tax system. We don’t think that is enough. We need a complete accounting of all the tax expenditures. If the member for London Centre would request that this bill be sent to committee, since I assume it will pass as it makes much sense, we could work out what I suspect would be an acceptable amendment which would broaden its impact.

If federal tax expenditures equal $30 billion, one can only guess what application that has in Ontario. The federal government is the past master at this. They have honed tax expenditures to a science, more so even than the provincial Tories have, but neither one of them is a slouch at it. I have always regarded a tax expenditure as a sneaky grant, because a direct grant to Ford of $28 million by the Ontario government creates a lot of waves and vibrations across Ontario since it is a lot of taxpayers’ money. I am sure they have given Ford Motor Company a lot more than $28 million over the years in one form of tax expenditure or another, but it doesn’t cause the vibrations out there. If this government resists this bill, we will know why, namely, because it will reveal for the first time some of the dollars.

We need to start all over again. I wonder what happened to Ken Carter. Does anybody remember Ken Carter back in 1966 when he brought forward his tax reform package? When that culminated in the so-called tax reform of 1971, I believe, it was a massive retreat from the bold principles involved in what Carter was trying to do, because Carter actually cared about equity and would have done something about it.

The federal Liberals caved in completely on the principles of the Carter report on taxation. They caved in basically to the wealthy and the privileged in this country. I suspect some of the Conservative members would agree with that. Now we have today in this chamber the Ontario Liberals coming in with a bill to table tax expenditures and to make that a requirement.

Presumably, the reason they want tax expenditures tabled is to know to what extent there are inequities in the tax system. Surely that is the underlying principle for tabling tax expenditures. Are there any inequities in the system, what are they and how much do they cost? Isn’t it interesting that the Ontario Liberals would do that this year? A year ago now, they voted for legislation abolishing succession duties and gift taxes -- two separate bills. The Ontario Liberals voted in favour of the top three per cent of all estates in this province. Then they have the chutzpah to come in here and say they are tabling a tax expenditure bill to detect whether there are gross inequities in the system. I am paraphrasing them now. Well, that’s a bit much. I suspect they may be bringing this bill in to see if there are some tax expenditures they are missing. Maybe they would like to introduce some at the provincial level that they thought of at the federal level. We find that very difficult to take.

We will support this bill -- at least I will; I don’t speak on private members’ bills for the rest of my caucus. I will support it because it does force the government to explain when it brings in a tax expenditure, which I think is good. It also makes it more difficult to introduce new tax expenditures, because the government knows it will have to explain them. Overall, if it were introduced and especially if the government would accept an amendment to it, I think we could make it a useful bill.

5:30 p.m.

I have always thought that income tax rates are progressive. Consequently, if a tax expenditure, or tax deduction or exclusion is measured by the taxpayer’s marginal rate, it means that the higher the marginal rate the greater the benefit. That is one way the tax expenditures protect the rich.

While we support the bill, I think it is incumbent upon the member, when he responds -- he has four minutes left -- to be more specific and to tell us what tax expenditures would be done away with in the unlikely event there is ever a Liberal government in Ontario. Surely, in principle, they would do away with some of them, even if they do not know the precise dollars that are involved.

The member would not expect us to say one thing and do another, If he is serious about tax expenditures and inequities in the system, surely he would carry through on that.

Would the member do away with the $1,000 tax deduction of interest in dividends, which costs more than $2 billion a year; with the deduction of charitable donations with receipts, $506 million; with the standard $100 deduction for charities with no receipts, $1 billion; with the registered home ownership savings plan, $364 million? These are 1975 federal figures -- and they go on and on. There are enormous numbers of tax expenditures. I don’t know which ones the member would support. I wish he could tell us.

Ontario is no slouch either. It has its share of tax expenditures. Companies are not taxed on personal property such as machinery, equipment and inventory. Companies receive an initial investment tax credit of seven per cent in some parts of the province and 10 per cent in others. Additional investment tax credit is available in manufacturing and processing, or exploration and production of oil and mines, in the equipment of rail, water and long-haul road transportation. Companies pay no provincial sales tax with the purchase of most types of machinery and equipment used in manufacturing. Ontario firms enjoy an employment tax credit, with the tax credited up to $1.75 an hour for full-time employees. The combined federal and provincial corporate income tax on manufacturing and processing industries is much lower than the equivalent combined federal and state taxes in the United States. Ontario has no land speculation tax. I could go on and on as to the exemptions.

What it boils down to is a redistribution of income. That is what tax expenditures do. I was looking at the federal share of taxes received from the corporate and private sectors. I found that in 1952 corporations paid 52 per cent of federal income taxes and individuals paid 48 per cent. It was almost even in 1952. In 1958, the slide was starting -- 44 per cent for corporations and 56 per cent for individuals. In 1968, it was 37 per cent for corporations and 63 per cent for individuals. In 1978, it was 30 per cent for corporations and 70 per cent for individuals. In 1979, it was 24 per cent for corporations and 76 per cent for individuals.

Between 1952 and 1979 -- 27 years -- we had the working people of this country go from 48 per cent to 76 per cent and, in the corporate sector, where profits have been very healthful, from 52 per cent to 24 per cent.

Mr. Kerrio: That means they got bigger wages, they tripled their wages.

Mr. Laughren: Yes, indeed. Let my friend whine for his corporate friends. It fits him perfectly.

It is difficult to support the bill knowing full well that if the Liberals ever had the opportunity to introduce such legislation they would only fatten up the expenditures for their friends, even more than the Tories have done. That’s what the Liberals have in mind for Ontario.

Perhaps Walter Stewart said it best, writing in the Ottawa Journal. He said that --

Mr. Speaker: The honourable member’s time has expired.

Mr. Laughren: I will not quote Walter Stewart. I will close by saying that tax expenditure budgets should be a plea for more equity in the tax system. If we are to believe that is what the member from London Centre has in his mind, or if those are his intentions, I hope he will tell us so when he responds.

Mr. Havrot: Mr. Speaker, an examination of this bill would seem to indicate that the member for London Centre thinks he and his party can do a better job of managing the provincial economy than this government does.

Mr. Kerrio: That wouldn’t be hard to do.

Mr. Havrot: Let me say that he is sadly mistaken. A Progressive Conservative government has led this province for almost 40 years, and in that 40-year period no Liberal Party in Ontario has been able to persuade the people of this province they can top the job done by the Progressive Conservative Party. Why is this so?

Mr. Kerrio: The NDP got you through last time.

Mr. Havrot: Yes, that’s right, but they won’t the next time.

I think the people of Ontario know they are well-served and well-governed by this party. They always have been and they will be for many years to come.

I am surprised that the members of the Liberal caucus do not understand why they fail to impress the Ontario voters. It has nothing to do with information and statistics the Liberals use to analyse their economic policy. It has everything to do with their economic policy, the policy of the Liberal Party. The Liberal Party has never had a coherent, consistent policy for the Ontario economy. If they are not quoting from some report or more frequently from some newspaper, they draw their material from government policy papers.

The people of Ontario are not going to be fooled by Liberal rhetoric. Instead, the people of this province listen to facts. These are some of the facts. For the past 16 years, Ontario has consistently led all other provinces in general economic activity as measured by the gross domestic product. In 1978, Ontario’s gross domestic product was $89.9 billion, the largest in the country. This was 220 per cent greater than Alberta’s gross domestic product. Despite the statements of the leader of the Liberal Party, Ontario is still the number one province in Canada and will continue to be number one.

The past year was the fifth successive year that Ontario’s unemployment rate was less than the national average.

Mr. Laughren: In Windsor too, Ed?

Mr. Havrot: I am talking of 1979. What is the honourable member going to do with cars? He should tell us how to sell them. He has all the answers; so he should tell us how we sell the cars.

Mr. Speaker: There’s nothing about cars in this bill.

Mr. Havrot: You are right, Mr. Speaker.

In 1979, there were 161,000 new jobs created, compared with 133,000 in 1978.

Mr. Laughren: You wouldn’t even drive a car.

Mr. Havrot: The member should ask his leader what kind of a car he drives.

Ontario’s economy grew in real terms at an average annual rate of 3.7 per cent during the 1970s, better than the growth rates in such large advanced industrial countries as West Germany, the United Kingdom and the United States. None of this sounds like bad management to me, and obviously it doesn’t sound like bad management to the people of Ontario either.

I say these things to convince the member for London Centre that any difficulties or frustrations he may be having with the economic policy of this government stem from the policies and statements of his own party.

I would like to add to the remarks made by my colleague the member for Oriole. In my opinion, this government provides a wide range of information on the cost and impact of its tax incentives. The coverage varies from the examination of wholesale structural changes -- including tax reform, the competitive position of Ontario industry and so on -- to analysis of specific incentives, such as the sales tax exemption for production machinery and equipment, tax credits and personal income tax exemptions.

I want to emphasize that in the provision of supporting data and information, as is the case in many other matters, Ontario leads all the other provinces and the federal government. Compared with other provinces, and indeed in comparison to the federal government, Ontario provides the most informative and useful analysis of its tax expenditure policy.

5:40 p.m.

The federal Liberal government has never been committed to freedom of information. It took a Conservative administration in Ottawa to finally get that matter moving.

In my opinion, the Ontario Ministry of Treasury and Economics has been imaginative in its development of budget concepts and in its fiscal policy analysis. As far as tax expenditures go, the Treasury has tended to concentrate its energies and resources on analysing current issues in depth and in the context of its overall fiscal policy. This approach is much more informative than reporting an historical list of tax expenditures in a superficial and less meaningful way.

While I do not pretend to have the expertise of the member for London Centre in this matter, I want to say a few words on the concept of tax expenditure.

The notion of tax expenditures as an analytical tool has achieved real prominence in the economists’ jargon only in the last few years. I believe there is considerable debate about what tax expenditures actually are. Given that the experts in the field are unsure about the concept, its implications and usefulness, I see no good reason for providing volumes of such information with the budget. To do so would lend an air of authenticity and acceptability to a concept which is not even yet fully understood or accepted by economists.

If we take as an example the reduction or elimination of a sales tax, how does one predict the actual cost of such a measure? How does one estimate and value the general stimulative effects to the economy? Is it by increased disposable income, increased consumer demand, increased employment, increased profits or income? I realize economists do have tools to estimate these very matters, but even given that the tax expenditure concept was generally accepted, which it is not, surely enough information is made available by this government and the very capable people in the Ministry of Treasury and Economics so that everyone who is seriously interested in the state of our economic and fiscal policies can be well informed.

For the reasons stated, Mr. Speaker, I do not support the bill.

Mr. Speaker: There are about three minutes before the member for London Centre uses up his time. Is there any other member who wants to speak?

Mr. Kerrio: Mr. Speaker, I would like to join in this debate in support of my colleague’s bill. I would like to read the purpose of the bill, because some of the honourable members have not addressed themselves to the purpose of the bill.

The purpose of the bill is to require the Treasurer of Ontario to disclose the actual cost to the public of every tax incentive program contained in the budget.

I think the government is going to have to get used to the idea that we are going to have to explain things to the public. The fact that they have been there for 37 years, and have not bothered explaining tax incentive programs, along with many other programs that government participates in, is exactly why we are trying to tell the people of Ontario that this government is at fault. It is about time they decided the public is going to become more involved, even if it is to the degree of sharing the purpose of a tax incentive with the public.

I think it is proven that if this government is prepared to spend millions of tax dollars to conduct polls to see what the public is thinking, it follows that they should be very willing to share with the public the reasons and the costs of tax incentive programs. I do not think that is too much to expect. I think that, in the years to come in this new decade ahead of us, this government had better be prepared to give the public more knowledge about what it proposes to do and how it is going to effect them.

Mr. Peterson: Mr. Speaker, I wish to thank the members for participating and the civil service for writing the preposterous speeches that have just been read by the two members opposite.

It is interesting to observe the degree of control that the bureaucracy now is exercising to the government back-benchers, particularly one back-bencher who deserves to be on the back benches, probably even in the fourth row, because their speeches were absolutely nonconstructive speeches that they did not personally understand.

The member from Sleepy Hollow was particularly vehement. I do not think he understands fully the nature of this plan. It was obvious his speech was written by some economists who were trying to justify their position. He stood up at a caucus meeting and said, “I will read the speech today,” and that is what happened. It is a completely defensive, reactive, bureaucratic speech, and the member should be ashamed to bring it into this House.

As to the words of my intellectual pygmy friend from Timiskaming (Mr. Havrot), they had no relevance to the bill here and should not have been brought forth.

I want to address my remarks specifically to my friend the member for Nickel Belt (Mr. Laughren). I want to agree with him. I wish this bill solved all the problems, but it does not. There are a number of ways it could be cleaned up constructively. I certainly acquiesce to that, and I would be very happy to take it to committee to broaden the bill, to ask for studies and to do work on tax expenditures that have already taken place. We must constantly reassess our system. It must be brought under legislative review, and this is one way to do that. I welcome his suggestion, it is a good one.

The honourable member made the point that ultimately I am concerned about inequities in the tax system. Indeed, I am. Inequity is a relative term, and everyone will have a different judgement about what is inequitable. We must have the information so that we can make these collective moral judgements, as I said when I brought this little moral conundrum before the House.

Under the guise of assisting motel owners, we are subsidizing the importation of American equipment for those hotels. The hotel and motel owners get a tax benefit, but at the same time we are not including in that benefit the Canadian manufacturers of comparable equipment. Those are the kinds of very difficult judgements we have to wrestle with, but at least that information should be before the House for full legislative scrutiny and review.

I want to say one more time that a tax expenditure reflects an acknowledgement. When the government decides not to tax a certain group of individuals or businessmen, or decides to give a preferential rate, then it is actively participating in the social and moral life of a province. These judgements are moral judgements and we are all entitled to bring our respective philosophies to bear on them, but we cannot do that without the relevant information.

I respectfully submit to my friend from Sleepy Hollow that that information is not available. This would force it in to one place in a disciplined, orderly way that we could compare a year later with the projected results.

In response to my friend the member for Timiskaming, who says one cannot calculate the results of some of these tax expenditures, I would say we have no right bringing laws into this province that we do not have some appreciation of the effects of.

That is a complete admission, through the honourable member’s mouth, written by the bureaucracy, that they do not know what they are doing in taxing expenditures. But they should know. If it does not weigh up to their estimates, if it doesn’t come close to their approximations, they should either revise their policy or get rid of it.

Unless we constantly review the taxing structure we have put before the people of this province, we will end up getting further into the hole. That is not something we should be doing.

I can assure the House that the Liberal Party will take a fresh, invigorated view of all the taxing matters. We will bring our judgements to bear on them and exercise our moral and economic and business leadership in this province.

USE OF WOOD AS HEAT SOURCE

Mr. Speaker: Mr. Belanger, on behalf of Mr. Yakabuski, has moved resolution 9.

Resolution concurred in.

TAX EXPENDITURES DISCLOSURE ACT

Mr. Speaker: Mr. Peterson has moved second reading of Bill 35.

Motion agreed to.

Ordered for committee of the whole House.

5:50 p.m.

SPEAKER’S RULING RE MEMBER’S PRIVILEGE

Mr. Speaker: The member for Wentworth (Mr. Isaacs), earlier today, referred to an article which appeared in the Hamilton Spectator on Wednesday, April 16, respecting leghold traps and asked me to rule as to whether his privileges as a member of this House had been impugned.

I have read the article carefully and am unable to find any reference to the member which is even uncomplimentary, let alone a breach of his privilege. I assume the member is referring to the quotation from the conservation officer, which reads as follows “‘I am concerned that a wave of anti-trapping sentiment may develop, where people will think they have the right to interfere with traps,’ he said ‘Ninety-nine per cent of the traps in use are legally set, but if the public sees that it is all right for a MLA to show these traps, they get the idea of removing them the next time they see one.”

The only recognized privilege that could be involved in a newspaper article such as this is the privilege of the member to a fair report by the media. I cannot see that this has been breached in any way, particularly as the article made it abundantly clear that the member had received the trap from the Society for the Prevention of Cruelty to Animals.

BUSINESS OF THE HOUSE

Hon. Mr. Wells: Mr. Speaker, pursuant to standing order 13, I would like to indicate to the House the business for the rest of this week and for next week.

Tonight we will be considering two reports, one from the committee concerning the Ontario Highway Transport Board, and the second, the report from the standing committee on public accounts.

Tomorrow the House will consider the supplementary estimates remaining from the 1979-80 fiscal year in the following order: Community and Social Services, Culture and Recreation, Health, Colleges and Universities, and Education.

On Monday, April 21, the House will go into committee of supply to consider the estimates of the Ministry of Intergovernmental Affairs.

On Tuesday, April 22, in the afternoon we will consider legislation: Bill 31, Bill 34, Bill 32 and Bill 33. We will consider Bills 31 and 34 on second reading, and Bills 32 and 33 on second reading and committee of the whole House, if required.

In the evening, the Treasurer will present his budget.

On Wednesday, April 23, the standing committees on resources development, general government and justice may meet in the morning.

On Thursday, April 24, in the afternoon we will consider private members’ public business, ballot items nine and 10. In the evening there will be debate on the second report of the standing committee on procedural affairs, concerning agencies, beards and commissions, which is order 15 on today’s Order Paper.

On Friday, April 25, we will be in committee of supply in the House on the estimates of the Ministry of Intergovernmental Affairs.

I would also like to announce at this time that beginning Monday, May 5, we will have what is being called the Confederation debate, in this House. For that week we will set aside the regular business and debate a motion concerning Confederation and national unity. The House has decided to proceed in this way.

During that debate all members will be invited to take part. There will be a time limit of 20 minutes on each member except those beginning and ending for their parties. It should be a very interesting and historic week for this House.

Mr. Martel: Mr. Speaker, might I ask the government House leader if he neglected to include on Tuesday’s agenda the third readings of the five first bills?

Hon. Mr. Wells: Yes, I am sorry, Mr. Speaker. It hasn’t been our usual practice to indicate the third readings on bills, but yes, we will call some third readings on Tuesday.

The House recessed at 5:55 p.m.

April 17, 1980

MEMBER’S PRIVILEGES

STATEMENTS BY THE MINISTRY

OLEOMARGARINE-BUTTER BLEND COMMITTEE REPORT

ENVIRONMENTAL ASSESSMENT BOARD

PROFESSIONAL ORGANIZATIONS COMMITTEE REPORT

CIVIL SERVICE STAFFING

MEMBERS’ ANNIVERSARIES

ORAL QUESTIONS

INTEREST RATES

AUTO INDUSTRY LAYOFFS

OUTBOARD MARINE

SELECT COMMITTEE ON ECONOMIC AND CULTURAL NATIONALISM

ESSEX EXPLOSION

CHILDREN WITH LEARNING DISABILITIES

ASBESTOS AT HOSPITAL FOR SICK CHILDREN

LAKE SIMCOE-COUCHICHING REPORT

PROCESSED MEATS

MUNICIPAL ASSESSMENT

HAMILTON-WENTWORTH REGIONAL GOVERNMENT

NOTICE OF DISSATISFACTION

ALLOCATION OF SEATS IN MEMBERS’ GALLERY

LEGISLATIVE PAGES

PETITION

SUDBURY TEACHERS’ STRIKE

REPORT

STANDING COMMITTEE ON SOCIAL DEVELOPMENT

MOTION

PRIVATE MEMBERS’ PUBLIC BUSINESS

INTRODUCTION OF BILLS

LEGISLATIVE ASSEMBLY AMENDMENT ACT

EXECUTIVE COUNCIL AMENDMENT ACT

INCO LIMITED ACQUISITION ACT

ANSWERS TO QUESTIONS ON NOTICE PAPER

ORDERS OF THE DAY

PRIVATE MEMBERS’ PUBLIC BUSINESS

USE OF WOOD AS HEAT SOURCE

EXPENDITURES DISCLOSURE ACT

USE OF WOOD AS HEAT SOURCE

TAX EXPENDITURES DISCLOSURE ACT

SPEAKER’S RULING RE MEMBER’S PRIVILEGE

BUSINESS OF THE HOUSE