Hansard Transcripts 1981-Jun-09 | Legislative Assembly of Ontario

Mr. Riddell: Mr. Speaker, on a point of privilege: I am sure you have been following the line of questioning in this Legislature on the attempt to have land in Vaughan rezoned. In answer to a question last Friday, the Minister of Agriculture and Food (Mr. Henderson) stood in his place and said -- as he has said on a number of occasions: not just last Friday -- that we in the opposition do not know what we are talking about when we refer to agricultural land.

Last Friday he personally invited me to visit the site to see it firsthand. I accepted that invitation and visited the site last Friday.

Like the member for Elgin (Mr. McNeil), I am a graduate of the Ontario Agricultural College, Guelph. I am also a farmer in Huron county and I think I should know as well as the member for Elgin what good agricultural land is. I went out there and saw lush growth of grain and pasture. I saw gently rolling land. In the one or two depressions, I saw a herd of Holstein cattle grazing on good lush pasture.

Mr. Speaker: Order, please. That is not a point of privilege.

Mr. Riddell: Mr. Speaker, he is questioning my expertise.

Mr. Speaker: Order. Order.

Mr. Riddell: Mr. Speaker, am I allowed to finish?

Mr. Speaker: No. It is not a point of privilege. Your privileges are not being abused in any way.

Mr. Riddell: Mr. Speaker, not only did his parliamentary assistant mislead him, but he misled the House.

Mr. Speaker: Order. Order. The member will please resume his seat.

ORAL QUESTIONS

ASSISTANCE TO FARMERS

Mr. Smith: Mr. Speaker, I have a question for the Treasurer. On Friday morning I heard the Treasurer say on radio station CKFM at 9:02 a.m. that he had between $50 million and $100 million to play with. That was the nature of the question he was asked. He did not use those words; it was the questioner who asked that. The Treasurer said he had $50 million to $100 million he would be willing to use if he thought it would help a bit with regard to the crunch farmers are facing, partly due to the high interest rates they have to pay at the moment.

Will the Treasurer tell us how he intends to use that $50 million to $100 million to assist people who are suffering from today's high interest rates, and would he inform the banks that he has a program in the works so they would now be told to stop any further foreclosures or forced bankruptcies until the government has brought forth its program?

Hon. F. S. Miller: Mr. Speaker, I think the nature of the question was as to the order of assistance that would be available. How would I fund it? I said I really had to depend upon the programs coming forward. If their cost was in the range of $50 million to $100 million, I thought we could find ways of doing it. I repeat that. I believe we can, because I do believe the problems are real and will be solved by this government.

The fact is, as the Leader of the Opposition knows, many divergent opinions were expressed. The opinions are not as numerous as the number of people in that room, but they are very many. One person's solutions do not agree with another person's perceptions of solutions, but we are trying to find out. The Minister of Agriculture and Food (Mr. Henderson) is working on ways and means of helping those people in real need, as opposed to using a shotgun approach that helps farmers who admittedly, even by the federation's standards, are not in those groups facing immediate problems. That is being done by my colleague. He is bringing those programs forward and he will find out what they are as quickly as we can approve them.

Mr. Smith: I am pleased the Treasurer and his colleague are working on a program to assist those in real need. I am pleased the Treasurer confirms that he did say he had $50 million to $100 million that could be available for that purpose. By way of supplementary, Mr. Speaker, would the Treasurer agree that since people are being foreclosed even as he and I are talking, he should announce to the banks that a program will be forthcoming to help those in need and he should instruct the banks not to further any foreclosures and not to force any more farmers into bankruptcy until the nature of the government's program is ascertained?

Hon. F. S. Miller: Mr. Speaker, the Leader of the Opposition has assumed the programs of assistance will relate to the forestalling of foreclosure or to interest assistance. I do not think that is a wise conclusion to jump to. There are many other structural problems out there affecting the very best managers in the food producing business, such as the price of grain as opposed to the incremental price in beef. They cannot really sell beef for less money than it costs to produce it.

I think very many efficient farmers have repeated that this is the state of affairs right now. I heard it at that meeting, and I hear it at many other meetings, that the high price of grain and the low price of beef combined have made life almost impossible for the specialized farmers who finish beef for slaughtering. We are hearing a great deal about that, and no amount of interest assistance will help that kind of problem. I hope the member will accept that.

He will also have to accept the fact that interest problems are general to all parts of society and not just to the farming industry. The small businessman and the person with a mortgage on a house are also affected by them. I am trying to find specific problems in the farm industries that can be remedied by temporary or long-term government programs.

Mr. Cassidy: Supplementary, Mr. Speaker: On a couple of occasions I have raised the case of Henry Friesen, the farmer from Mildmay, whose farm is being auctioned two or three days from today because he was unable to meet his commitments as a consequence of the high interest rates. Could the Treasurer tell the House whether the government intends to come forward with a program that will relieve farmers from the impact of the high interest rates, as the Treasurer seemed to indicate at the meeting on the airport strip with farmers on Thursday of last week; or is that simply going to be a promise that is made to be broken in the hope that he can get out of here with his political skin and without providing any assistance for farmers at all?

Hon. F. S. Miller: Mr. Speaker, in spite of some of the provocative comments the honourable member has made, our intent is to help where problems are real. We are not trying to find a political solution to a problem that is not real. We are trying to find ways of helping those farmers who can stay in business and weather what may be a downcycle in prices and an upcycle in interest. I think the member has jumped to the conclusion there is going to be some bail-out assistance for people who may or may not be justified in getting help.

I know suggestions have been made by the farm community that there should be a review agency -- I believe it is in place -- to look at those people whose farms are being seized now. The Minister of Agriculture and Food can talk more about that than I can, because I believe they have been talking more to him about it than they have to me.

Mr. McKessock: Final supplementary, Mr. Speaker: Will the new programs be announced within the next week?

Hon. F. S. Miller: I would hope so, but I cannot promise that. I think there is a great desire to hurry something, but if by hurrying a week, a week and a half or two weeks we do not have a well-designed program, I think that would be foolish. However, like the member, I would like the opportunity to announce the measures while the House is in session. That would be preferable for all of us, I am sure. It really depends upon --

Mr. Sargent: The farmer cannot take your promises to the bank.

Mr. Speaker: Order.

2:10 p.m.

Hon. F. S. Miller: I have to help the farmer with those problems that are in Ontario's domain. The implication being made by the member for Grey-Bruce is that all the problems are made by this government.

Mr. Stokes: That is the new Chicago gang, Mr. Speaker.

Mr. Speaker: I am just not sure who is from Chicago and who is not. However, let us listen to the question and the answer, and not engage in private conversations or interjections. Mr. Minister.

Hon. F. S. Miller: I was probably responding to an interjection at that point, so taking your guidance, I shall sit down.

VAUGHAN LAND USE

Mr. Smith: A question to the Minister of Housing: Given that the minister has said in this House, on the matter of the rezoning of the lands in Vaughan, that he could think of no reason why anyone in his ministry would want to place a telephone call to the Minister of Agriculture and Food (Mr. Henderson) to ask that ministry to rethink its objection when the matter had already been sent to the Ontario Municipal Board; and given that the Minister of Agriculture and Food continues to insist he received a telephone call from either the minister or the minister's office, which sent him on this interesting mission of having the member for Elgin (Mr. McNeil) look at the land, would the minister, now that he has had several days to talk to his staff, tell this House whether he has finally determined whether he himself, or someone else in the ministry, or his parliamentary assistant at that time, the member for York North (Mr. Hodgson), actually placed the call that resulted in the Minister of Agriculture and Food sending out his own parliamentary assistant to try to withdraw an objection?

Hon. Mr. Bennett: Mr. Speaker, I said in this House last week, and again this week, in relationship to telephone calls to the Minister of Agriculture and Food regarding official plan amendment number 95 of the city of Vaughan, or community of Vaughan, that to the best of my knowledge, I was neither --

Mr. Sargent: Tell us who made the money on the deal.

Hon. Mr. Bennett: Usually the member for Grey-Bruce can explain that much better than most in this House.

Mr. Speaker, I was saying in relationship to the question from the leader of the Liberal Party that to the best of my knowledge there was no telephone call made by me to the Minister of Agriculture and Food. I do not recall one. I left open the position that it has been over two and a half years since this issue first came into discussion, which if I recall was back in September 1978, so I would be wrong to try to say unequivocally that I had or had not made a call.

The second part of the question was regarding the staff. I have spoken with my staff and to the best of their knowledge there had not been a direct call made, or a call made, to the Minister of Agriculture and Food.

On the other part of the question, I have not consulted with the member for York North, who was my former parliamentary assistant, but I do say to this House that if the member for York North happened to make a telephone call to the Minister of Agriculture and Food in relationship to the official plan amendment number 95, which happens to be in the community of Vaughan, which happens to be in the riding that he represents, I would trust he would make it as the local member with a concern, the same as the member for Wentworth North (Mr. Cunningham), or from Kent, or any of the others.

I have no knowledge of whether the member for York North did or did not make the call, but I would say --

Hon. Mr. Pope: The member should not be so smug.

Hon. Mr. Bennett: He is always smug. Anyway, Mr. Speaker, if he did make it, then he made it as a member and not as the parliamentary assistant.

Mr. Smith: Supplementary, Mr. Speaker: The story that is being concocted is obvious, but if the minister does not know that the member for York North made the call, I would ask him how he knows for sure in what capacity he would have made the call, if he had made the call.

How does the minister account for the fact that the Minister of Agriculture and Food regarded it as a call from the Ministry of Housing, since the Minister of Agriculture and Food, after these many years of serving with both the Minister of Housing and the member for York North, knows the difference between the two of them? How would the minister account for the fact that the Minister of Agriculture and Food felt it came from the Ministry of Housing and not from the individual member acting as the member for York North?

In addition to that, may I ask the Minister of Housing whether he is aware of two things? First, is he aware that the profit, the increase in the value of the land in Vaughan by a mere stroke of the pen -- by that mere action, or by the cabinet's taking that action -- had the Ontario Municipal Board agreed with the Minister of Agriculture and Food, would be $88.8 million? Is he further aware of the statement made by the member for York North, who said he would not answer any questions as to whether he made the call or not, but who said that if the government asks him to make a statement, he will make a statement? Will the minister take the muzzle off and let the member for York North answer a straightforward question?

Hon. Mr. Bennett: First of all, Mr. Speaker, I would think the Leader of the Opposition would like to rephrase his opening remarks. I did not concoct any statement. I want to make that very clear to him. He seems to want to be so smug there. He always thinks it is only his members who are sanctimonious and able to ask ministers questions.

Interjections.

Mr. Speaker: Order. Answer the question, Mr. Minister.

Hon. Mr. Bennett: Mr. Speaker, I want to make it very clear: I did not make any indication that the member for York North had made a call; I said that if he happened to have made the call --

Mr. Breithaupt: Is the minister going to ask him?

Hon. Mr. Bennett: I do not intend to ask the member for York North, no.

Interjections.

Mr. Speaker: Order.

Hon. Mr. Bennett: I want to answer the other part of the question, just to keep the Leader of the Opposition in his place. I did not put a muzzle on anyone in this House, nor should I. I am sure that if the member for York North has something to say to this House, he has said it before and he will speak again in this House without any hesitation or without any prompting from the Leader of the Opposition. I give members that assurance.

Very clearly, if a call was made -- and I want to emphasize this again: if the call was made, and I have no idea whether it was or not -- then I trust the member for York North, as an elected member in this House representing the community of Vaughan, has a right to ask me, or the Minister of Agriculture and Food, or the Minister of Transportation and Communications (Mr. Snow), or anybody else, to have a certain item reviewed, the same as the members over there have asked this ministry and other ministries to review items.

Mr. Cassidy: Supplementary, Mr. Speaker: Since it is now clear that any advice that either the Minister of Housing or the Minister of Agriculture and Food would give to cabinet on the appeal to overturn the OMB's decision on this particular official plan change in Vaughan would be politically tainted because of their involvement with the case up until now, would the Minister of Housing agree to have independent agronomists and farmers appointed by the Ontario Federation of Agriculture advise whether the land in question should be kept in agriculture under Ontario's food land guidelines or whether it could be taken out of it?

Would the minister agree to have that advice made public, and would he agree to have the cabinet abide by that decision of independent outside authorities rather than leave this decision about farm land preservation in Ontario to a cabinet that is not capable of making that decision?

Hon. Mr. Bennett: First of all, Mr. Speaker, I am sure my views and opinion on this particular item would not be tainted to the same degree that the leader of the third party's opinion on the subject happens to be already.

I do not intend to recommend to cabinet at this point that we retain consultants or others to do certain agricultural surveys in that particular area. We have a Ministry of Agriculture and Food with a number of very well qualified people who can give us that particular advice and guidance --

Interjections.

Mr. Speaker: Order.

Hon. Mr. Bennett: When I say that we happen to have people in that ministry who can give the advice, the same Mr. Pinder who gave us the advice on this particular piece of land also gave us advice on the Kent land. It was not accepted by the Liberal member as being a reasonable position to be taken by the Ministry of Agriculture and Food, and he asked this minister to review the situation. We did not hire consultants to go back out and review the situation; not at all. Through negotiations we were able to find a compromise that allowed for the development that the member from Kent wanted in that particular area. The item will go to cabinet. It will be decided in cabinet on the facts as they are.

2:20 p.m.

Let me say in relation to one point I missed in the question from the Leader of the Opposition, the point about the $88.8 million, I would be delighted if he could supply me with how he got those calculations. I do not have them in front of me. Let me say there is no profit made on any commodity until it has changed hands and the cash has been rendered.

Interjection.

Hon. Mr. Bennett: I could not care less what item the member for Ottawa East (Mr. Roy) is talking about. The fact is there is no profit made until there is some exchange of sale. The OMB has rendered a decision and the cabinet, with advice given by my ministry, by the Ministry of Agriculture and Food and by others involved, will make a decision on that appeal.

Mr. Smith: According to real estate experts in Thornhill today the current value of agricultural land in agricultural use in the town of Vaughan east of Kleinberg is $8,000 per acre, and the current value of undeveloped residential estate land in King City is $75,000 per acre, the difference being $67,000 per acre. Since there are 1,326 acres, a mere stroke of the pen therefore increases the value of that land by $88.8 million. Given those are the figures, and given this is an extremely serious matter in which the cabinet can hardly be trusted to make an objective decision, since it is trying so hard to obscure the facts right now, would the minister --

Interjections.

Mr. Smith: I know he is knee deep in this scandal and I know he does not like to hear about it. I know how it feels.

Interjections.

Mr. Speaker: Order. Will the honourable member resume his seat, please?

Mr. Smith: I am sorry, Mr. Speaker. They are talking and I am going to stand until they are finished.

Interjections.

Mr. Speaker: Order. Can we just settle down and proceed with question period in an orderly manner so that we can hear the questions, we can hear the answers and we will all be much wiser. Proceed, Mr. Smith.

Mr. Smith: Given I have now answered the points the minister wanted to know about the basis of the figure of $88.8 million, and given the seriousness of this matter, will the minister finally and at some point tell the House who made that call? If nobody made the call on behalf of the Ministry of Housing, is the minister not concerned that the Minister of Agriculture and Food continues to say he was sent on this unusual mission in the middle of an OMB hearing by someone from the Ministry of Housing?

Hon. Mr. Bennett: No, I will not say he was sent on a mission by anyone at a request from the Ministry of Housing; not at all. Frankly, I have great --

Mr. Peterson: Do you employ any gremlins?

Hon. Mr. Bennett: I would think they are all within the Liberal Party, the way things are going on today. They must have a lot of research staff who can sit for two and three days at the OMB reviewing the files.

lnterjections.

Mr. Speaker: Order. Mr. Bennett, just answer the original question.

Hon. Mr. Bennett: I will attempt to, Mr. Speaker. I gather the Leader of the Opposition was reviewing some of the costs of land and so on. It is so easy to throw out figures about what an acre of land is worth, forgetting about costs or interest or servicing or anything else. I do not accept the figure of $88.8 million. As well, I think it is irrelevant at this point.

I say to this House very honestly, I do not know who made the phone call, if one was made to the Minister of Agriculture and Food. I say that clearly.

Mr. Breithaupt: And you will not find out.

Hon. Mr. Bennett: I said I do not know. I am not the Minister of Agriculture and Food; I happen to be the Minister of Housing. I would suggest the Minister of Agriculture and Food, if he received a call, took the action he thought was appropriate. He had his parliamentary assistant do a survey of the situation and report back to him.

HOUSING PRICES

Mr. Cassidy: Mr. Speaker, since the Ministry of Housing seems so unconcerned about protecting farm land, I have a question for the minister about the affordability of homes for people who want to have houses of their own, particularly in Metropolitan Toronto.

In April the minister told this House he did not acknowledge there was a crisis in the housing market in Metropolitan Toronto. Since the average price of a house sold in the Metropolitan Toronto area rose by almost eight per cent in April, and since it rose again in May by 6.5 per cent, to reach the level of $93,176, will the minister now acknowledge there is a crisis in terms of affordability of housing in the Metropolitan Toronto area and tell us what the government is going to do about it?

Hon. Mr. Bennett: First, Mr. Speaker, I have said before and I repeat again today, I do not believe there is a crisis in the housing industry in this province or in this community. I do not believe it. I make that very clear, and I think I am supported in that position by my colleagues not only in other provincial governments but in the federal government as well. We have said there is an affordability problem in certain cases; there is no doubt there is. Some people are trying to buy homes -- and I have said this before and I must be open and frank about it -- that are beyond their ability to carry.

I trust the leader of the third party also reads a few newspapers, including the Toronto Star, which for a long period of time ran stories saying that the situation in housing was getting beyond the affordability position of all in this province. He will remember back about a month ago, day after day it ran pictures and stories about the cost of housing. I give the Star full marks in the last week or 10 days. It has now started to show there are units available in Metropolitan Toronto and in the Toronto general regional area at a reasonable price. They may not all come up to the expectations one would like to have of the ideal home, but people on average incomes have the opportunity of buying and owning them.

Mr. Cassidy: Supplementary, Mr. Speaker: If I could take the minister up on that, particularly since again in April he said there were homes available in Metropolitan Toronto for the average income earner, the minister will be aware of the fact that the average income earner in November of last year made about $17,200 a year as the average industrial wage. That has gone up a bit since last November, but taking the accepted ratio of 30 per cent of income, the average industrial wage earner in Metropolitan Toronto could afford, at today's mortgage rates, to buy a house worth $28,000 or less -- and nothing more.

Will the minister explain how that average industrial wage earner is to buy a home, when out of the 2,900 houses that were sold in the multiple listing service area in May there were all of 30 apartments that may have been selling for less than $28,000 and six town houses that could conceivably have been sold for less than $28,000? In other words, when only one per cent of the property changing hands in the month of May was accessible to that wage earner on the average industrial wage, how can the minister say there is no affordability crisis for people on ordinary incomes who want to buy homes in Metropolitan Toronto?

Hon. Mr. Bennett: First, Mr. Speaker, we might as well be very realistic about life. Not everyone is going to be able to own a home in our society, and not everyone is going to want to own a home in our society. Frankly, under the assisted home ownership program a number of people were brought into ownership, with the federal and provincial governments' assistance, who should not have been there --

Interjections.

Mr. Speaker: Order.

Mr. Sargent: On a point of order, Mr. Speaker: We have this minister talking about affordability when he is trying to buy a home on --

Mr. Speaker: Order. There is nothing out of order. That is not a point of order.

Hon. Mr. Bennett: I wish to say very clearly that under the assisted home ownership program that the federal and provincial governments got involved in several years ago, in some cases the mortgages on those homes are now coming up for renewal. I am sure the leader of the third party will know very well that some of those people who went in under a subsidized program should never have been encouraged by government at any level to get into ownership, because they now find themselves with a cost factor that is beyond the 30 per cent of their gross income needed to maintain their particular residences.

I say again to the member, without knowing all the facts in relationship to the $28,000 and knowing whether someone has a down payment or what the down payment might amount to in the purchase of a home, there are still homes in the affordability category in this community and in this province.

2:30 p.m.

Mr. Cassidy: Where are they for $28,000?

Hon. Mr. Bennett: The member should read the Toronto Star. Lately they have been running some that are in the $39,000 category.

Mr. Cassidy: You cannot afford it on $18,000 a year.

Mr. Speaker: Order. With great respect, you have asked your supplementary and the minister is responding. Please proceed.

Hon. Mr. Bennett: I conclude by saying there are units in an affordable category in this community. For once, I would hope members would realize not all the housing situations are in the Metropolitan Toronto area. There are other communities in this province, perhaps to the surprise of the leader of the third party, where units are selling for less today than they originally sold for.

I am talking about London and communities in other parts of Ontario where housing prices have not kept anywhere close to the inflationary fact we have been dealing with in this province and this country over the last five years. The cost of housing in most of those communities has been somewhat below it. Those members should not always take Toronto as being the only example of what is going on in the great province of Ontario.

Mr. Conway: Supplementary, Mr. Speaker: I believe I heard the minister say that part of the current difficulty was a function of a number of people trying to buy beyond their means. Would the minister help us to understand the nature and extent of that problem by supplying us with any statistical analyses he has of that aspect of the difficulty? How many people does he know of who are compounding this difficulty by trying to buy beyond their means?

Hon. Mr. Bennett: I am not sure I would want to imply that these people were compounding the problem. In talking with the industry, and indeed in talking with my own people in the Townsend project, while we have a variety of models at varying prices --

Mr. Nixon: You only have about 10 houses down there.

Hon. Mr. Bennett: The member for Brant-Oxford-Norfolk should know. It is down in his area. We are doing fairly well.

Interjections.

Hon. Mr. Bennett: Those two sound great as a pair. They should go on the stage. They are in unison for the first time.

We find in discussion with the industry that people are going into the new housing market and buying homes at the top of the range with all the frills they can possibly work into those models. I am saying that when people are buying a home they are going to have to trim their desires to fit the cloth they have to cut and spend according to what their income happens to be. They should not try to buy a Cadillac when the best they can afford is something in the Chev classification.

Mr. Cassidy: Would the minister stop the doubletalk and come to grips with the issue? There are people who work in Metropolitan Toronto and therefore cannot live in London or Townsend. There are people who are earning the average industrial wage, which is about $18,500 a year. Therefore if there is only one income in the family, these people cannot pay more than $28,000 for a house if they have a 10 per cent down payment.

Will the minister tell us where those people are going to buy a house when there were only six condominium town houses that sold for less than $35,000 in the Metropolitan Toronto listing region, which goes into Durham, York and Peel as well as Metropolitan Toronto?

Is this Minister of Housing saying that keeping the promise as far as he is concerned means a family on the average industrial wage will only have the right to rent in the future?

Hon. Mr. Bennett: No, Mr. Speaker. If someone is interested in purchasing a home there are certain things in life one has to sacrifice or give up to try to achieve that desire. It is fine to suggest that individuals with a certain income are not going to be able to afford to buy a home; I have to recognize that fact. In the past our experience with the assisted home ownership program was not good. We led some people into purchasing who should not have done so. They are now experiencing extreme difficulty, if not giving up the units they thought would be their worldly possessions.

Let us draw a clear distinction from what the leader of the third party is asking. He is talking about what was sold in this area on the multiple listing service. I suggest we look at the listed properties for sale and the price range in which they happen to be.

I emphasize again that this government's intention is to allow people to get into home ownership, but if the honourable member thinks it is going to be possible for this government or the federal government to design a program that will allow home ownership to people of all incomes, he is living in a fool's paradise. It is not possible.

To answer the latter part of the NDP leader's question, I think that we in the government have an obligation, and we are attempting to do it, to provide --

Mr. Cassidy: That is a sad comment after 38 years.

Hon. Mr. Bennett: A sad comment? Let me tell the member that this province has nothing to be ashamed of in its housing stock, not a thing. We have nothing to be ashamed of, whether it be in the private sector or under the Ontario Housing Corporation. We have a housing stock that is second to none anywhere on this continent, and I give the development industry and the investors full marks for what they have been able to do in providing adequate housing for the people of Ontario.

Mr. Cassidy: It's too bad the people can't get into it.

Mr. Speaker: Order.

Hon. Mr. Bennett: Through the Ontario rental construction loan program, we trust we will be able to get a number of units on stream for rental purposes at a reasonable rate.

INTEREST RATES

Mr. Cassidy: Mr. Speaker, I have a question for the Treasurer, who is among other things the man responsible in the government for the profiteering by the banks.

Has the Treasurer had the privilege of reading the advertisements that were placed in Monday's papers by the Bank of Montreal? The bank placed the ads in the Toronto Star at a cost of $12,418 and in the Globe and Mail at a cost of $17,907, which were tax deductible contributions to those newspapers. The bank used its excess profits to defend its right to make excess profits on the basis of the high interest rates.

Will the Treasurer give an undertaking that, rather than forcing the banks -- which have all said they want to carry on this kind of educational campaign -- to use our money on a public relations campaign that we will pay for, the government of Ontario will bring in an excess profits tax on bank profiteering on interest rates and use the proceeds to protect people from the impact of the high interest rates?

Hon. F. S. Miller: Mr. Speaker, I do not think, even by the wildest extrapolation of accountability, that the province of Ontario is responsible for the profits or lack of profits in the banks of this country. They are federally chartered institutions, and the leader of the New Democratic Party knows that. He knows the basic corporate tax laws are federal.

At the provincial level we have taxed them at the highest of the provincial rates, and we have the highest capital tax on banks as opposed to any other type of industry -- double that of the average company in this province. I do not say that with pride or otherwise; I say it as a matter of fact.

Apart from that, one of the great differences between the New Democratic Party and my party -- and I believe even the Liberal Party shares this with us -- is we believe that, in a system such as we have in North America, corporations are set up to make a reasonable profit. That in no way explains the current profits of the banks or otherwise. I am simply saying that is one of the objectives of corporations.

In countries of the world where parties such as the honourable member's have been able to get into power, they not only have eliminated profit but also have doubled the cost of everything.

Mr. Cassidy: Perhaps as a matter of tax policy the Treasurer can explain to this House why it is that over the course of the last 10 years he and his predecessors have raised personal income tax revenues to the government of Ontario by 250 per cent, from $1 billion to $3.5 billion a year, but over that same period of time the combined federal and provincial tax on bank profits, which have gone up tremendously, has gone up by only 14 per cent.

Why is it that when the Treasurer brought down his budget a few weeks ago he was content to sock it to individuals of the province in terms of increases in personal income tax once again, but he was not prepared to take anything away from the banks despite the huge increases in profits they have had and their profiteering on interest rates?

Hon. F. S. Miller: A couple of interesting facts: First, the honourable member knows that personal income taxes and the rates at which they apply are indexed in Canada. The saving to the taxpayers of this province through indexation alone this year will be about $1.6 billion more than it would have been had we followed the American system of not indexing. Therefore, through the co-operation of the federal government and most of the provinces of Canada, we have been protecting individuals from a great deal of the impact of inflation on personal taxes.

Second, we do nothing at all to index taxation for corporations; so there is no such cushion in the rates for corporations and they do pay. I do not know if the member's percentages are right. I think they may be suspect. I would like to check them. But if that is the percentage change, that is the percentage change in their profit. We in no way cushion them from the devaluation of money when it comes to taxation.

2:40 p.m.

Mr. Smith: Supplementary, Mr. Speaker: The policy of high interest rates, which has developed in the United States of America and carried over into this country, will have an impact on the small business sector disproportionately severe in comparison with the impact on larger companies and will result in a further concentration of power in the hands of a smaller number of companies big enough to withstand the rates, which companies can pass them on in the form of price increases, thereby contributing to inflation.

Given those facts, it is essential that something be done to help small business. Will the Treasurer call in the presidents of all these financial institutions, the banks in particular, and ask them -- instruct them, if necessary -- to give a special break to small business in terms of a rate just under the prime rate, the way the Bank of British Columbia does, and to give the small business people in this province some reasonable assistance, even if it means their profits have to be a trifle lower?

Does the Treasurer not think he ought to do something to recognize that Ontario's backbone resides in the small towns and the small businesses? They are going to the wall at the moment. Call in the banks and make them help with regard to assisting small business.

Hon. F. S. Miller: Mr. Speaker, the honourable member speaks as if he is a real authority on small business. Has he ever owned one? I wonder. That is a rhetorical question, because I know --

Mr. Smith: My father did, and I assisted him in his store.

Hon. F. S. Miller: Sit down!

Mr. Speaker: Order. The minister may choose, for the edification of the members, to answer the question as he sees fit or not at all.

You have asked your supplementary. Give the minister the opportunity of replying.

Hon. F. S. Miller: The Leader of the Opposition wants to dish it out, but he cannot take it.

He is a blithering idiot. Any time anybody asks anything of him, he starts to froth at the mouth. He stands up there --

Interjections.

Mr. Speaker: Order, please. Mr. Miller, are you going to answer the question?

Hon. F. S. Miller: I will, Mr. Speaker.

Mr. Smith: On a matter of privilege, Mr. Speaker --

Some hon. members: Sit down!

Mr. Speaker: Order.

Mr. Smith: Don't wave your finger at me.

Mr. Speaker: I am not waving my finger at anybody.

Some hon. members: Sit down!

Mr. Speaker: Order.

Mr. Smith: On a point of privilege, Mr. Speaker: I do not believe that the rules of this House make it appropriate or parliamentary for the Treasurer to refer to me or anybody else in this House, even members of his own caucus, as blithering idiots or as foaming at the mouth, particularly when they are simply attempting, as I was, to respond to his question of whether I have ever owned a small business.

I wanted to say that I have been a part owner of a small business. But, more than that, my father owned a small business and I helped him with it every weekend when I was going to school. I have some idea of what it means when a small business is put to the wall by banks, which the Treasurer does not.

Hon. Mr. Ashe: Give him a medal.

Mr. Speaker: Order. A new question; the official opposition.

Mr. Breithaupt: Let the minister give the answer instead of just making that kind of comment.

Mr. Speaker: No. That was the final supplementary.

Mr. Cassidy: On a point of order, Mr. Speaker: I ask you to ask the Treasurer to withdraw the comments he made about the Leader of the Opposition in the interest of preserving some sense of decorum in this Legislature.

Mr. Riddell: Show that you've got some backbone.

Mr. Speaker: Order. I think the observations were inappropriate, and I ask the Treasurer to reconsider them and withdraw.

Hon. F. S. Miller: Mr. Speaker, I will always be guided by you. It seems funny to me that they are able to ask all those questions --

Some hon. members: Withdraw.

Mr. Speaker: Order. Let us just settle down and the Treasurer will proceed.

Mr. Laughren: It is your funny friend who is causing the problem.

Mr. Speaker: Just a minute. Settle down.

Hon. F. S. Miller: I withdraw, Mr. Speaker. I was trying to answer the question.

Mr. Speaker: That calls for a new question from the official opposition.

NURSING APPLICATIONS

Mr. Wrye: Mr. Speaker, I have a question of the Minister of Colleges and Universities.

The minister will remember saying, in an answer to a question posed by my leader last month, that the random selection of acceptable candidates for nursing positions at community colleges was, to use her words, "the fairest process possible."

Undoubtedly, she now will be aware of the views of the 800 members of the Ontario School Councillors' Association, an organization with representatives at all levels of the educational system. In the words of Jack Paquette of that association, they "vehemently opposed the use of such a lottery system in identifying applicants for offers of admission."

Does the minister agree with those views? If she does, when will she move to implement them and rid the province of the lottery system?

Hon. Miss Stephenson: Mr. Speaker, as I explained very patiently and very clearly at the time the question was originally asked, the lottery or random selection process is used only as the final selection process. It is used only when the number of qualified applicants as selected by the various methods established by the faculties of nursing in the community college system have been exhausted and the number of qualified applicants is greater than the number of places available. At that time, and only at that time, is that random selection process used.

It is a matter that has been subjected to very critical scrutiny throughout the nursing program and throughout the college system, and it has been examined on a number of occasions. The fact is that the colleges and those involved have felt this was the fairest way to make selections from equally qualified individuals at the end of a selection process.

Mr. Wrye: The minister obviously will be aware of the views of John Vanderlee, who is the head of the nursing program at Algonquin College of Applied Arts and Technology, where 110 qualified applicants were turned away. He said some of the 130 accepted might be inferior to those turned away and promising careers are ruined in this fashion.

If the minister is so unimpressed with the views of the councillors' association, perhaps she would care to comment on the views of the Registered Nurses' Association of Ontario. Their position paper, a copy of which the minister was sent last March, suggested a total of eight detailed criteria for admission to nursing programs. The criteria do not include any lottery system; in fact, they have been proposed, according to the executive director of the RNAO, as an alternative to this present silly system.

Hon. Miss Stephenson: The honourable member is not entirely correct --

Mr. Smith: He is so.

Mr. Speaker: Order.

Hon. Miss Stephenson: -- in that he is saying the recommendations made by RNAO are the only recommendations that should be followed.

The RNAO, in my meeting with them not more than 10 days ago, said when the criteria they had suggested should be included were used and there were still more qualified applicants than there were places, obviously some additional method had to be used. I asked what should be the additional method. They did not have an alternative to random selection of that fully qualified group.

The matter is under consideration. It is not etched in stone, but at present it is the one that seems fairest for equally qualified individuals.

Mr. Wildman: Supplementary, Mr. Speaker: Is the minister satisfied that there are enough places available for qualified applicants, especially in view of the shortages that have been experienced by some public health agencies and by organizations such as Algoma Manor, which is in my riding and which is considering closing one wing because it cannot get enough nurses?

2:50 p.m.

Hon. Miss Stephenson: Mr. Speaker, one of the unfortunate facts of life is that there are 24,000 qualified registered nurses in Ontario who are not practising nursing. If there were some improvements in flexibility for employment for many of those nurses, I think a considerable number would seriously consider going back to the practice of nursing.

We do not truly have a shortage of qualified personnel. What we have at present is a distribution problem and a fact that certain of the qualified nurses are not practising nursing.

LAKE SIMCOE POLLUTION

Hon. Mr. Norton: Mr. Speaker, this is supplementary to an answer I provided to the Leader of the Opposition yesterday when he raised a question, not about froth but about slime in Lake Simcoe. Perhaps I can cast a little slime on the froth this afternoon and respond further to his question, particularly with regard to the loading of phosphorus in Lake Simcoe.

It is my understanding that in 1975 the loading of phosphorus in Lake Simcoe was approximately 138 metric tons. By the time the report to which he referred was completed, I believe in late 1979, the phosphorus loading had been reduced to 103 metric tons. As I recall, the report at that time set a target for maintaining that level, and the ministry subsequently set a target for 1983 of 87 metric tons.

I can advise the honourable member that the best estimate of the loading in 1980 was 99 metric tons, which represents some reduction from 1979 and a movement in the direction of that target.

The testing that is being done in Barrie will be completed shortly, and I am pleased the preliminary indications are that system will be successful and can lead to Barrie achieving the projected target, I hope, by 1983. As soon as that testing is completed in Barrie, the equipment will be moved to Orillia and similar testing will be done there.

In the meantime, the ministry has been monitoring the quality of the main Holland Marsh drainage canal for some time now and has been collecting data on the variations in the phosphorus levels there. This information is necessary and will be helpful to us in the treatability studies that will be done next spring with respect to the spring discharge of water from the marsh into the lakes.

Perhaps contrary to the impression the honourable member had yesterday, progress is being made. It is true that the target date of 1983 for the completion of the York-Durham sewer, which I think was established in the 1979 document, has been extended to 1984. As I understand it, that is a realistic construction target.

Mr. Smith: Supplementary, Mr. Speaker: Since the minister has admitted the 1983 target will not be met with regard to the Aurora-Newmarket sewage, will he not agree that the 1983 target is unlikely to be met with regard to Holland Marsh either, since work has hardly even begun there?

In particular, in the Barrie and Orillia matter, will he start cost-sharing discussions with those municipalities on the basis that it was promised they would begin a year ago and they have not yet started? Will he go ahead with the cost-sharing discussions now and be sure that, once this preliminary testing is done, we will move ahead with full speed?

Hon. Mr. Norton: I am not sure of the dates, but it is my understanding that there were meetings between my predecessor, Dr. Parrott, and the officials from Barrie and Orillia. It is also my understanding, and I believe it has been communicated to them, that we would be prepared to share costs over and above the normal subsidy levels by sharing the excess above the normal subsidy levels on a 50-50 basis, which would be a substantial improvement over what would otherwise be their entitlement.

ASSISTANCE TO FARMERS

Mr. MacDonald: Mr. Speaker, I wish to repeat one of yesterday's questions to the Minister of Agriculture and Food in the hope that this time I might get an answer.

Since the Ontario Federation of Agriculture presented a three-point program to him two months ago -- a program that is specific, a program that is workable in that it just duplicates what most other provinces have already instituted, and a program that is prioritized into short-term and long-term needs -- why is it that at the meeting at the Constellation Hotel last week the minister and his colleagues, including the Premier, had no reply at all to that proposal made two months ago and instead pleaded for some suggestions from the farmers so he might finally get at this topic?

Why did 1,000 farmers and their farm women have to drive hundreds of miles to the Constellation Hotel to break through the insensitivity and irresponsibility of this government, when it has not acted on programs given to it two months ago?

Hon. Mr. Henderson: Mr. Speaker, it appears quite clear that the honourable member has not been listening to what has been said in this House on many occasions.

First, the meeting he is referring to was one that I called; I do not know the date, but I will say it was six weeks ago. At that time the federation suggested there should be more money available through the Farm Credit Corporation to assist the farmers. I did take that message to Ottawa when the provincial ministers met with the federal minister.

They also suggested that the funds should be made available to the individual farmer on the same basis they are made available to a corporation. I took that message to the federal minister. He agreed to take it to his cabinet colleagues, but he has not responded beyond that.

I might say that when I took the idea of additional funding for the Farm Credit Corporation to Ottawa, the minister made me aware that he had $500 million and if he were to satisfy the complete community he would need $1 billion. He agreed to take that to cabinet too, but so far there has been no response.

I could go on but, I think if the honourable member remembers, I told him last Thursday that I had carried out the wishes of the Ontario Federation of Agriculture. We still had a difference, and I openly admitted it. The federation felt that we should come up with some sort of interest subsidy. I readily accepted that we had a different point of view at that stage. But beyond that, the president of the federation and I have pretty well agreed that I had carried his messages to the appropriate people.

Mr. MacDonald: Other than the minister playing his role as an errand boy by carrying things to Ottawa, will he respond on what the provincial government's response has been to the specific things within the jurisdiction of Ontario that were asked by the OFA? There are a half a dozen things in that three-point program that are strictly provincial. Can he cite any to which he has responded?

Hon. Mr. Henderson: Mr. Speaker, I do not know how one gets a half a dozen things in a three-point program. That is kind of double mathematics to me.

Mr. Foulds: Have somebody read it to you.

Mr. Speaker: Order.

Hon. Mr. Henderson: It is Socialist mathematics. Our Treasurer has responded to these questions fully today.

Mr. Nixon: Supplementary, Mr. Speaker: Does the minister not agree that the province does have some responsibility in this connection just as we have in providing some assistance for Chrysler and Massey-Ferguson and even for finding money for the development of the paper industry in the north?

When is he going to stop being just the errand boy for the Treasurer and the Premier, Messrs. White-Lipped and Trembling, who sit here smiling while he has to defend the indefensible? Why can we not have a provincial program similar to those that have been established in the other provincial jurisdictions?

Hon. Mr. Henderson: Mr. Speaker, our Treasurer does not need to be defended by anybody. He is very capable and quite capable of putting his own decision across. He has done that today.

I remind the honourable member across the way that $120 million of my budget each year goes in direct subsidies to the farming community. We do not forget the farmers; we have done that year in and year out.

3 p.m.

CANADA'S WONDERLAND

Hon. Mr. Elgie: Mr. Speaker, yesterday the member for Hamilton East (Mr. Mackenzie) raised a question with the Premier concerning employment practices at Canada's Wonderland. He referred in particular to complaints by the International Alliance of Theatrical Stage Employees, the Toronto Musicians' Association and Canadian Actors' Equity Association to the effect that their members had been denied jobs by the employer.

As members know, the rights of trade unions and their members in Ontario are governed by the provisions of the Labour Relations Act. One of the key provisions of that act is section 3, which provides that every person is free to join the trade union of his own choice and to participate in its activities.

Over the years the section has been construed to permit persons to make a free choice as to whether or not to belong to a trade union. There is nothing in the Labour Relations Act which requires an employee to engage union employees unless the union has acquired bargaining rights and has negotiated a condition in its collective agreement requiring union membership as a condition of employment.

To my knowledge, none of the three organizations that have raised complaints against Canada's Wonderland has acquired bargaining rights at that location. While I appreciate that those organizations do not normally utilize the provisions of the Labour Relations Act to gain recognition, nevertheless the provisions of that act are open to them. There is no other statute for which I or any of my colleagues are responsible that requires the employer to extend voluntary recognition to unions or to employ union members.

I understand the nature of the concerns that these three organizations have expressed, namely, their desire to see Ontario residents who have made career choices as musicians, actors or stagehands to have all available employment opportunities for which they are qualified. At law, the only way those objectives can be pursued in this province, and indeed in all other provinces of Canada, is to obtain bargaining rights either by certification or by voluntary recognition in accordance with the applicable labour laws.

Mr. Cassidy: Supplementary, Mr. Speaker: Does the Minister of Labour think it is acceptable that the Taft Broadcasting Company of Cincinnati, which came into Canada to put up the Wonderland complex at Maple, brought its attitude from the United States into Canada, which was that under no circumstances did it want to have any union in the park at all?

Should not that company at least have been prepared to sit down and meet the reasonable requests of the entertainment unions concerned to meet with them and discuss the possibility of using union labour there, rather than importing into Canada anti-union practices that belong only in the United States?

Hon. Mr. Elgie: Mr. Speaker, I have made it very clear that I understand the position the members are taking. I also understand that they have never followed the traditional methods of obtaining bargaining rights. The leader of the third party understands that too.

What I am saying to him is that this government by law has no authority to require any employer to voluntarily accept recognition of anyone as a collective bargaining agent. There is a procedure outlined in our law; it is not comparable to anything in the United States and, in my opinion, it is a great improvement over what is available there. There is nothing by law that we can do to change those relationships.

Mr. Cassidy: Since the Premier was prepared to go there and to help open Wonderland, is the minister prepared to use the influence the government has to intercede with Wonderland's management, the Taft corporation, and to ask them to meet with the unions and deal fairly with those workers?

Hon. Mr. Elgie: This minister is prepared to do anything that he has an obligation to do under the laws of this province.

HOG STABILIZATION PAYMENTS

Mr. Yakabuski: Mr. Speaker, I have a question of the most popular minister in the House, the Minister of Agriculture and Food.

On May 22, when the Minister of Agriculture and Food rose in the House and told us what he thought about Mr. Whelan's plan regarding the farm income stabilization legislation, he went on to say: "Mr. Whelan announced that Ontario's hog stabilization payments would be deducted from the federal hog payment. He made this announcement in the name of leadership and equity. I quote what Mr. Whelan said, 'The federal government must show leadership in providing an equitable national level of assistance'."

My question to the minister is, how could Mr. Whelan make such a statement when a Quebec farmer across the river from Renfrew county -- my area -- receives the equivalent of $2,400 a year in transfer payments from Ottawa, and a Renfrew county farmer on the west bank of the Ottawa River receives the equivalent of $160 a year?

Hon. Mr. Henderson: Mr. Speaker, I still have that announcement here, and I would have no trouble quoting to support what the honourable member is saying.

We in Ontario feel that we have been penalized. We do not know why, but immediately upon receiving --

Hon. Mr. Bernier: Look at the smiles on their faces.

Mr. Speaker: Order.

Hon. Mr. Henderson: I realize they are smiling over there, but I do not know why.

Immediately on receiving word from the federal Minister of Agriculture I did send a joint telegram to him with Doug Farrell, the president of the Ontario Pork Producers' Marketing Board. We pointed out to the federal minister that to the best of our knowledge we had exactly the same stabilization in the sow-weaner program for the hogs in Ontario as in the province of Quebec, and we requested a meeting with him last Thursday morning.

Interjections.

Mr. Speaker: Order.

Hon. Mr. Henderson: Mr. Whelan was away at the time. His staff acknowledged my telegram. It is my understanding -- in fact, I more than understand it -- that Mr. Henry Ediger of my staff was invited to attend a meeting last Thursday with the hog producers and Mr. Whelan. When they presented the position of Ontario to Mr. Whelan he pointed out to them that his staff gave him a different story than our Ontario hog producers had themselves. He was going home to Essex last Friday, but he assured them he would talk to his staff and try to get back to them.

As of Monday morning when I came in to Toronto, Mr. Earl Haslett, my economist, and Mr. Henry Ediger have both been standing by, ready to go to Ottawa tomorrow or Thursday to meet with the federal minister to try to get the equity for Ontario farmers to which we are justly entitled to give us equality with the other provinces. If we do not get that, we are being punished $7 million by the federal government, and we do not know why.

INTRODUCTION OF BILLS

TORONTO ISLANDS AMENDMENT ACT

Hon. Mr. Wells moved, seconded by Hon. Mr. Norton, first reading of Bill 103, An Act to amend the Toronto Islands Act, 1980.

Motion agreed to.

Hon. Mr. Wells: Mr. Speaker, the purpose of this bill is to extend the operation of the stay of execution of the writs of possession related to the residential premises on the Toronto Islands from July 1, 1980, to December 31, 1981. A bill has been drafted to follow the essence of the Swadron report, a report that the honourable members know was prepared on the residential community at Toronto Islands. By staying the execution of the writs until December 31, it will allow us the summer period to discuss the bill with all interested parties.

3:10 p.m.

ORDERS OF THE DAY

GASOLINE TAX AMENDMENT ACT (CONTINUED)

Resuming the adjourned debate on the motion for second reading of Bill 72, An Act to amend the Gasoline Tax Act, 1973.

Mr. Sweeney: As we adjourned last evening, I was drawing the minister's attention to the fact this gas tax bill was particularly insidious because it was being levied against and was creating an index on the very commodity in our society which has increased in price over the last number of years, and which is expected to increase over the coming years, at the fastest rate.

Everybody in this House is well aware of the increases in oil prices both inside and outside Canada over the last number of years. We are also aware that, regardless of the deal struck between the Minister of Energy and Natural Resources of Alberta, Mr. Mervin Leitch, and the federal Minister of Energy, Mines and Resources, Mr. Marc Lalonde, we as consumers in Ontario are going to have to pay more.

That is not going to be just this year, next year or in the year after. At least in the foreseeable future there is no reason for us to believe that in each of the subsequent years, however long that may be, the price of oil is not going to go up. The price of gasoline, a byproduct of oil, is going to go up accordingly. By putting an indexed tax on that, we are piggybacking on the very nature of inflation.

I have gone back and taken a look at what some of the former Ministers of Energy said about oil pricing, fuel pricing and taxes. It is interesting that whether we go back to the member for Prince Edward-Lennox (Mr. J. A. Taylor), the member for Brock (Mr. Welch), the former member for Leeds, Mr. Auld, or the member for Ottawa West (Mr. Baetz), the same message comes out time and time again.

For example, in May 1977 the member for Prince Edward-Lennox said, "It is not the time to increase inflationary pressures in Canada, it is not the time to further decrease job creation and it is not in the interest of Ontario or Canada to reduce the competitive capability of our export industry." He was speaking of the very things we are speaking of. When he was the Minister of Energy he drew clearly to our attention that there were inherent dangers in increasing the price of oil and consequently the price of gas because of the impact it would have on our economy.

When the member for Ottawa West was the Minister of Energy, speaking in the Legislature in June 1978 he said: "I should like to advise the members that during the past few weeks I have had discussions with the Minister of Energy for Alberta and with the federal Minister of Energy, Mines and Resources about the proposed price increases... These discussions have been followed up by my officials. At these meetings we have made strong representation against [these] while the Canadian economy is soft and unemployment is high, and when inflation is still not under control." The then Minister of Energy indicated we should not exacerbate inflationary pressures.

What about the former member for Leeds? When he was the Minister of Energy he said, "Ontario views crude oil and natural gas price increases, unrelated to improving Canada's security of supply, as inflationary, a deterrent to job creation and a further factor in harming Canada's industrial competitiveness." Of course it goes on and on, but Mr. Auld made the point that increases in fuel prices are inflationary.

We have had the member for Prince Edward- Lennox as Minister of Energy; we have had the member for Ottawa West as Minister of Energy; we have had Mr. Auld as Minister of Energy. But what about the member for Brock as Minister of Energy? In November 1979, what did the member for Brock say about fuel increases? He said, "I should like to think, in the context of ensuring adequate oil supplies, that the industry views itself as implicitly holding in trust the revenues it receives from consumers, and I would like to think that the pricing of oil and natural gas will not be used simply as a disguised taxation vehicle." Oh yes, he said, "should not be used as a disguised taxation vehicle, a means of cascading additional dollars into the coffers of government."

I wonder if the Minister of Energy had a little talk with the Treasurer (Mr. F. S. Miller), saying: "Hey, Mr. Treasurer, we are not supposed to do that kind of thing. I told the Canadian Energy Conference in Banff, Alberta" -- of all places -- "that Ontario does not agree with that. We are not supposed to do that kind of thing."

So we have had the member for Prince Edward-Lennox as the Minister of Energy, we have had the member for Ottawa West as the Minister of Energy, we have had Mr. Auld as the Minister of Energy, and we even have Mr. Welch as the Minister of Energy, saying that we should not do it, that it is inflationary and that there is no valid reason why governments, either federal or provincial, should do it.

Of course I am reasonably sure that the present Minister of Energy in particular, when he made that comment, was thinking of the provincial government of Alberta and was thinking of the federal government of Canada taking these kinds of actions. Never in his wildest dreams did the Minister of Energy for Ontario ever think the Ontario Treasury would do these kinds of things, would apply those kinds of inflationary pressures on the people of Ontario. These are the kinds of things that every single Minister of Energy for the last five or six years has said we should not do. I would draw that to the attention of the Minister of Revenue (Mr. Ashe).

I guess it would not be unreasonable for people outside of this Legislature to say: "Why don't you get your act together? How can one minister say one thing and another one say something quite different?"

What about the Premier of Ontario (Mr. Davis)? Has the Premier been consistent in this matter? Let's take a look at a couple of things that the Premier of Ontario has said because of the message of the 1981 provincial election. The Premier had a little jingle going all over Ontario for some 44 days. What was that message? Keep the promise. Keep the promise, people of Ontario. Keep the promise. Help the Tory government of Ontario to keep the promise. Let's see what the good Premier of Ontario has been saying. Let's find out what the promise is that we are supposed to be keeping.

On September 15, 1979, speaking to the Ontario PC Campus Association, to the young Tories I guess that would be, wouldn't it?

Interjection.

Mr. Sweeney: No, this is the Premier. The Minister of Energy is off the hook for a minute.

Mr. T. P. Reid: A young Tory is anybody who is over 50.

Mr. Sweeney: Oh, is that what it is? Over or under?

Mr. T. P. Reid: Over 50 and under 65.

Mr. Sweeney: I see. Between 50 and 65.

Anyway, what did the Premier of Ontario say? He said at that time, "But we also took the view that to have a price increase which generated the kind of cash for the government of Canada, the foreign oil companies and the government of Alberta, which they could not possibly reinvest quickly enough to solve energy security problems, would be a mistake and a distortion and a clear raid upon the spending power of the average citizen of this province."

3:20 p.m.

When he speaks to the young Tories, the Premier says: "Fellows, we are not supposed to do that. We are not supposed to dig into the pockets of Ontario citizens. We are not supposed to reduce their spending power. That is not kosher. That is not the right thing for us to do." That is the promise the people of Ontario were led to believe -- especially young people, especially young Tories.

Hon. Mr. Ashe: Everything is relevant.

Mr. Sweeney: Oh, I see. I hope the young people up in the gallery heard the minister say everything is relevant. What that means, I say to the young people, is that what they said yesterday is not necessarily true today --

Hon. Mr. Ashe: I said "relevant." Get out your dictionary.

Mr. Sweeney: Whatever was good yesterday does not necessarily have to be true today. In other words, yesterday's promise is not necessarily yesterday's promise. Yesterday's promise is what was good enough for yesterday.

That was what the Premier said in September 1979. Let us take something more recent, Mr. Speaker. What did he say to the Ontario Municipal Electric Association on March 4, 1980? He said, "We will continue to resist windfall profits for provincial Treasuries and petroleum companies." Yet we know the $50 million or more the Treasury of Ontario will get because of the sudden increase in price due to production cutbacks in Alberta can be labelled as nothing other than windfall profits. There is no other name for it. But the Premier says we should resist those. Obviously what he means is that the government of Alberta and the government of Canada should resist them, but when it comes to the government of Ontario, that is a different matter altogether.

What did the Premier of Ontario say back in October 1979? The Premier was speaking in this Legislature at that time. Here is what he said: "I have opposed and will continue to oppose any change in the existing price agreement that would generate windfall profits" -- the Premier seems rather fond of that term "windfall profits" -- "rather than oil security, and economic recession rather than shared national growth." So he was against windfall profits in October 1979 and in March 1980.

How about something more recent than that? Here we are in October 1980. At that time the Premier of Ontario was very upset because Alberta had announced its first cutback, which was going to mean higher prices. That was an action taken by a provincial government. Here is what the Premier said at that time: "This burden" -- this burden of increased costs on the taxpayers of Ontario, on the fuel taxpayers of Ontario -- "is not being imposed on Canadians by any foreign power or by any international collapse, but by a Canadian provincial government."

The Premier of Ontario was rather upset that a Canadian provincial government would be putting its hands into the pockets of the taxpayers of Ontario. Yet what did the taxpayers of Ontario discover on May 19, 1981, only six months after the Premier made that statement? They discovered that he, his Treasurer, his Minister of Revenue and his whole government were going to put their hands into the pockets of the taxpayers of Ontario with an ad valorem tax, not only a tax that would be set for at least one year, but a tax that would go up and up and up, as the price of oil would naturally go up.

At that time, in response to a question, the Premier also said: "The economy needs some stimulation. It does not need this additional burden imposed on it." We agree with what the Premier says. This economy needs some stimulation. We do not need these additional burdens. We do not need this type of ad valorem, percentage indexing, additional burden. The taxpayers do not need someone digging into their pockets time after time, robbing them of the possibility of stimulating the economy of the province.

That is what Ontario's Ministers of Energy have said. That is what the Premier has said. But it is one thing to say it yesterday and it is something quite different to do it today.

What about the impact on those communities such as my own in the Kitchener-Wilmot area? In this matter I speak for the people who sent me here, unlike some of the people in the back rows of the government benches. First of all my constituents sent me here to object when a taxing measure by this government is going to increase the taxing necessity of the municipal governments in Kitchener and in Wilmot by almost $100,000. The treasurer for the city of Kitchener has estimated the higher provincial taxes for gas and diesel fuel will add another $70,000 to the cost of operating the municipality. The municipality of Wilmot has estimated its additional costs will be in the neighbourhood of about $20,000. Putting the two of them together it totals $90,000 plus.

Those are moneys the province is transferring from the local municipality into the provincial Treasury. The government is saying to those municipalities that it is supposed to be assisting financially: "We are going to take the money out of your pocket, and fellows and gals, if you want it back again, then you soak your own taxpayers again. You go to the property tax levy and you take more money out of them. Kitchener, you take $70,000 more out of the property taxpayers of your city. Wilmot township, you take another $20,000 out of the property taxpayers of your municipality."

We are telling those people they are going to be hit twice by the same provincial government. When they drive their cars and trucks out on the road, they are going to have to pay the additional tax to the Treasury of Ontario. When they arrive home in their residences and in their businesses, they are going to have to pay an additional tax to the local municipality so it in turn can put more money into the provincial Treasury.

If the Minister of Revenue believes anybody, on this side of the House at least, is going to stand by and allow that to happen and not oppose it, he does not understand what we believe to be our responsibilities towards our constituents.

We have been talking about how we are affecting the farmer and how we are affecting the communities. I know the farmer will get a rebate for any tax he pays on his own property, but what about the farmer's produce that has to go from the farm gate to the processor and to the retail supermarket? What about the cost and the taxes involved in carrying that produce? What about the extra cost to the farmer himself in getting his produce to market? What about the extra cost to the consumer, to the housewife who has to go into the retail market and buy those products?

I and everybody on this side of the House know for sure, whether the people over there realize it or not, that is an extra cost on the food prices. Who is going to get blamed for that? We both know who is going to get blamed. The farmer who produces it has nothing to do with that extra cost, but he is the guy who is going to get blamed for it.

What about small businesses? We see these people on the government side stand up day after day and proclaim the philosophy of the small businessman, how they have to help the small businessman, how the small businessman is being hit by inflation, how the small businessman is being hit by high interest rates. They say they are the backbone of the Ontario economy, they are the backbone of the middle class of Ontario, they are the people who pay the taxes.

What do we do? We hit them twice again. We make it more expensive for them to do business. We make it more expensive for them to transport their retail products and their manufactured products to their retail outlets, to their wholesale outlets, from their industries or whatever the case may be.

3:30 p.m.

Hon. Mr. Ashe: The member should keep that in mind when the pay bill is before this House.

Mr. Sweeney: Fine. The members opposite are the guys who are introducing this tax.

Hon. Mr. Ashe: I mean, what a ridiculous analogy.

Mr. Sweeney: What does the minister mean, "What a ridiculous analogy"? This is something that he has to cope with every single time he steps out to do business. Every time the small manufacturer wants to import or bring into his plant some raw materials he is going to have to pay more for them because of this tax.

Every time he is going to send a finished product out to a warehouse or to a retail outlet he is going to have to spend more. That is going to add to his costs; it is going to add to the cost of the service he provides; it is going to add to the cost of the finished product. Once again the businessman, the small manufacturer, is going to be blamed for it, but the members opposite are the guys who are imposing that additional tax.

My riding is one that stretches about 25 miles across. There are a lot of small communities in my riding where there is no public transit, communities where people have to drive their cars and their trucks to work. Most of them work in the larger cities -- either in Kitchener, in Cambridge or in Waterloo. Not very many of them work in New Dundee; not very many of them work in New Hamburg; not very many of them work in Baden, or Petersburg, or St. Agatha, or Phillipsburg or all of those wonderful communities. But in every single case they have to drive to work. Often it is two members of the family on shift work who have to drive to work, and once again they are going to be hit by this.

There are some cases, I agree, where there are going to be commuters in my riding, particularly in the city of Kitchener. But they are going to have to pay more too, because the transportation system in that city is going to have to recoup those losses somehow. Granted the city picks up a deficit of about $1 million a year, but it cannot pick up all of those increased costs. They are going to have to recoup them somehow, so the price of tickets is going to go up.

So commuters going to their jobs are going to pay more, whether they drive their own cars or their own trucks or whether they go by public transit.

We hear the Minister of Industry and Tourism (Mr. Grossman) telling us over and over again that tourism is the second largest money earner in this province after automotive production. I think that is the point he has made a number of times. It is one of the foundations of the economy of the province. He is spending millions of dollars in advertising in Ontario, across Canada, in the United States and probably over in Europe too; I do not know. He is even going to put this flashy logo that we hear so much about, "Ontario, yours to discover," on our licence plates now.

What is he telling the people? "You know, folks, come on into Ontario. We have got it all." We do have a beautiful province, an absolutely beautiful province. We have lakes, and rivers, and forests and campgrounds. Nobody is denying that; the minister has a good selling point. And what happens? Instead of supporting the Minister of Industry and Tourism, the Minister of Revenue, the Premier and the Treasurer say: "Oh no, fella, we are going to cut you down. We are going to make it more difficult for tourists in the province of Ontario. We are going to make it more difficult for them to travel in Ontario. We are going to make them think twice before they travel in Ontario."

It is just the little bit that breaks the back. It may only be a cent here, a cent there and a cent someplace else, but the Minister of Revenue knows that you reach a breaking point sooner or later. You reach a point where all numbers of people say: "That is enough. I am not going to travel this summer. I am not going to go up into the tourist area of the Treasurer of the province. I am not going to go up into the beautiful country of northern Ontario. I am not going to travel into some of the areas of eastern Ontario. I am just going to stay home here and keep my money, probably stash it in the bank or something else, but I am not going to spend it on tourism in the province of Ontario." Those people in the tourism industry are going to suffer; they are going to pay the price.

While we are talking about the Minister of Industry and Tourism, I could not help noting the coincidental column of Hugh Winsor in the Globe and Mail today. I am sure the minister saw the column because it discusses how the Minister of Industry and Tourism is trying to get back some credibility for this province in the whole question of oil and gasoline pricing in this country.

After all the things the Treasurer, the various Ministers of Energy and the Premier have said about bad old Alberta, it seems they may now want to smoke the peace pipe. Was it not three or four weeks ago a delegation from Alberta came to Ontario? They wanted to meet a number of people. Who went out to one of the airport hotels and sat down with them? Who said to them no doubt very quietly, but pretty clearly, "Look, fellows, maybe we can make a deal? Maybe we can get this thing settled. Maybe we can stop tearing this country apart. Maybe Ontario is ready to deal." That was the message the representatives from Alberta carried away with them from the meeting with the Minister of Industry and Tourism.

Another meeting was set up, according to Mr. Winsor. It is documented pretty clearly that our Minister of Industry and Tourism went out to Alberta.

Hon. Mr. Ashe: Edmonton.

Mr. Sweeney: Alberta, Edmonton, wherever. He went out there. It was predicted one of his reasons for going was to make a public statement saying, "Ontario is going to practise a little bit of statesmanship. We are ready to make a deal. We know that some of these changes are inevitable. We know that Ontario is going to have to accommodate them in some way."

What happened? The minister delivered what is said in the column to be "an 18-page text larded with references to the Canadian Domestic Market Development Agency ... But nothing about the all-important prerequisite on the other side of the equation. Not the slightest hint that Mr. Grossman was Coach Davis's halfback sent into the game with a new play. Larry didn't even get a chance to fumble the ball.

"The simplest explanation is that Treasurer Frank Miller had already fumbled the ball for him with his increased gasoline tax. After the ad valorem grab, it was not politically tolerable for another minister to be seen advocating another price increase."

As Mr. Winsor goes on to point out in a very appropriate finale, we won the down, but probably lost the game. That is the price we are paying.

Hon. Mr. Ashe: You could always support the Liberal position of world prices.

Mr. Sweeney: I do not know. I do not know what kind of deal the Minister of Industry and Tourism was carrying from the Premier, but speculation is rife around here. The speculation was rife when he had that meeting and when he went out to Alberta. Maybe the speculation was all wrong, but I do not think so. I do not think that is reasonable. I think the process of making a statesmanlike deal was there but, because of the quick grab for a few extra dollars for the Treasury of Ontario, the deal could not be made.

I do not know whether the Minister of Revenue is aware of it, but this picture says, "Something from Everybody." Underneath is the little caption, "What's So Funny?" showing the Premier of Ontario laughing uproariously while the Treasurer of Ontario is socking it to the taxpayers of Ontario. I have had more comments from taxpayers in my area about this photo -- maybe the minister himself has had some. The basis of the comments is, "You know it's bad enough to get it socked to us, but then they laugh at us at the same time."

I do not know whether the Premier or the Treasurer is aware of the impact of this budget and of the way that cavalier attitude is being perceived by the voters of Ontario. That is the only way one can describe it -- a cavalier attitude. That is the point. This is a little caution to let the minister know that the people of Ontario are not happy with this situation. All this time the Treasurer, the Premier and the Minister of Energy have made their pious statements about the terrible people in the federal government and the terrible people in the Alberta government; yet we are turning around and doing exactly the same thing in Ontario.

Needless to say, whatever cards they had to play in relation to the discussion I had a couple of minutes ago with respect to the Minister of Industry and Tourism have been lost. Ontario has no more credibility in the national circles of Canada. It has lost it. Quite frankly, to use an expression the minister knows, it was sold in relative terms for a mess of pottage.

3:40 p.m.

The thing that really annoys some of us over here is that the Treasurer of Ontario has said time and time again how strongly he objects to the federal government collecting taxes so that it can use them to reduce its deficit. He has said that a number of times. He said a government should not be collecting these kinds of taxes. Yet a few days ago, as the minister will remember, in response to a question by my leader about a windfall profit tax, the Treasurer got up -- it was one of the few times he was not even smiling, and I am not sure whether that means he is serious or not, now that I think of it -- and baldly said "What do you mean, a windfall tax? Do you not realize Ontario has a deficit in excess of $900 million and whatever extra taxes we are able to collect from this, whether we anticipated them or not, will go towards reducing that deficit?" In view of the lack of credibility, the utter hypocrisy of the same people on that side of the House in those seats saying one thing yesterday and something totally contradictory today, no wonder people out there are having so much trouble. Suppose a parallel announcement had been made when this tax was levied, saying, for example: "We are coming right up front. We are going to collect an extra tax, but we are going to use it for an energy-related purpose. We are saying in advance that we are prepared to put that money aside and use it to build methanol plants. We are going to use it to develop hydrogen as an energy source. We are going to use it to develop propane as an energy source. We are going to use it to develop compressed natural gas as an energy source." If that kind of thing had been said, quite frankly, I think the people of Ontario and many members on this side of the House would have been prepared to accept it. People could have been sold that, if they were clearly told that was why it was being collected. In other words, the province, the Treasurer, the Premier, the Minister of Energy and the Minister of Revenue were so concerned about the energy problem in Ontario that they were going to levy a specific tax for the purpose of improving the energy problem in Ontario. Then I am sure people would have accepted that.

There have been all kinds of indications. Our party, among others, has clearly indicated some of the procedures. We have indicated the cost of it. We have indicated we would be prepared to levy a specific tax to raise the money to pay for that particular project. I noticed -- I think it was in the Sunday Star -- a description of four Ford cars going down Highway 401. The story went on to reveal these were not just four ordinary Fords. One was running on propane, one was running on methanol and one was running on compressed natural gas. I forget what the fourth one was running on. I guess it was one of the other alcohol fuels.

The article was telling people the future is here now. This is not speculation. This is not some fuel alternative that is going to be present or available in Ontario five or 10 years from now. It went on to say the Ford Motor Company in Oakville this coming fall is going to turn off its assembly line cars that would be technically equipped to burn propane as a fuel. They are saying Ontario has to get in line.

We are objecting strongly because this tax is inflationary. As so many of my colleagues have said during this debate, it piggybacks on top of a price that is going to rise automatically anyway. We have said if the tax were collected for a specific energy purpose we might be able to support it, but not the inflationary process involved in the way the government is doing it.

I could not help but notice in either today's or yesterday's Globe and Mail a comment by Malcolm Rowan, who is the Deputy Minister of Energy.

Mr. Nixon: Is he ever.

Mr. Sweeney: Some people think maybe he is even the Minister of Energy. He had indicated publicly that Ontario had requested drilling rights for oil and natural gas in the Hudson's Bay lowlands -- an interesting comment. Maybe this tax could replace that because Ontario has already announced it has drilling rights. Those drilling rights are at the gas pumps of the retail outlets of the province. Where they are drilling is in the pockets of the people who drive up to those pumps, and they are drilling right through. The hole is not going into the ground; it is going into the pockets of the people of Ontario who drive up to those pumps.

They are going to have holes in their pockets because this government is taking the couple of pennies they still had left after paying Alberta, after paying Ottawa and after paying all the government's other taxes. So the government is going to be drilling and it did not have to go to Ottawa to seek permission. It decided right here and now.

We and the people of Ontario know what the realities of March 19 are. The people also know now what the government means when it says, "Let's keep the promise." It does not mean yesterday's promise. It does not even necessarily mean today's promise. It probably means tomorrow's promise. We do not know what that is going to be, but the government will keep it. No matter what it costs, the government is keeping the promise.

We oppose this bill.

Mr. Foulds: Mr. Speaker, it is interesting and a pleasure and an honour to rise in debate on this piece of legislation because traditionally tax bills have been the bills that have changed governments. Tax bills have been bills that have inspired, at least symbolically, revolutions to the south of us. Tax bills are the bills in a parliamentary democracy over which the government has sole jurisdiction to introduce, while the opposition is restricted to opposing. In terms of the money, they cannot be amended.

We in this party oppose this tax for a number of reasons, the basic one being that the tax itself is inflationary. The tax adds to the cost of living and is a particularly unjust tax where there are no alternatives for the purchasers of gasoline. The previous speaker talked about communities in his riding which were 25 miles wide. My riding, which is probably one of the smallest in northern Ontario, is four times that wide. Most of us in northern Ontario must travel many hundreds of miles to get from one place to another within northern Ontario.

3:50 p.m.

I want to deal very briefly with the ad valorem tax aspect of the bill. I know the minister and his colleagues will say in defence that many other provinces, including Saskatchewan, use this method of taxation. But Saskatchewan, which uses this form of taxation, is an enlightened province and counterbalances that, for example, by wiping out OHIP premiums. There is a countervailing force on behalf of the consumer in that overall budgetary strategy in Saskatchewan. There is no such countervailing force in this budget.

Hon. Mr. Ashe: Stick to the principle of the bill.

Mr. Foulds: I did not intend to speak on the budget. I intended to stick strictly to this bill, as have all the previous speakers in this debate. However, the intervention by the Minister of Revenue forces me to talk about the injustices in the budget itself.

The Deputy Speaker: A little bit.

Mr. Foulds: This is just by way of illustration about how this tax is one of the worst examples of what the government did in the budget generally, Mr. Speaker.

The principle of the ad valorem tax is relatively simple. As the price goes up, the tax goes up in a percentage-like increase. What is also quite unjustified in this method of taxation is that it lives off the avails of taxes. Not only does it live off the avails of inflation and fuel inflation, but because it is calculated on the retail sales price, it is calculated on other taxes. This tax, in effect, taxes other taxes, and one cannot get cleverer than that when one wants to get revenue into the coffers.

I suppose if it is looked at cynically this government brought in a crass grab for additional revenue which it will have in perpetuity. It did so in the first year of its government. It hopes that by the fourth year of this government, when the election comes along, people will have become used to this unfair method of taxation for which there is no countervailing benefit for the consumer.

I particularly want to talk about the experience of northerners. On the first night this tax was announced -- budget night, May 19 -- we assumed the tax would be based on the actual price, just as the budget said it would be. When we checked with the minister's officials, we found it was not being based on the actual retail price charged at the pumps, but on what is called a benchmark price established in a triangle area bounded by Oshawa-Kitchener-Niagara.

Hon. Mr. Ashe: Niagara Falls and Barrie.

Mr. Foulds: And Barrie, all right. So there is a four-sided trapezoid including Barrie.

An interesting thing is admitted by the government when it bases its taxes on the average or benchmark price in that area. What it is saying is that the price above that benchmark price, which is the usual price charged in one-industry towns in northern Ontario, is just too high and is an unfair base. Nevertheless, I want to point out to members that this tax will hit people in northern Ontario more than the people in that benchmark area and more than the people in the riding of my friend the member for Kitchener-Wilmot (Mr. Sweeney). The reason that it will do that is that we in northern Ontario do not have the compensating alternatives that people here in southern Ontario have. We have no objection to the 580-million subsidy for TTC.

Hon. Mr. Ashe: I have never heard you complain about the $10-licence plates.

Mr. Foulds: Just a minute. I am getting to that. Just hold your quips until the end.

An hon. member: It has been a frustrating week.

Mr. Foulds: I know it has been a frustrating week for the Minister of Revenue. Here he was given the ball to carry these bills through the Legislature. It was passed neatly into his stomach by the Treasurer who decided that these were the sources of revenue. While the minister hasn't exactly fumbled the ball, he is still groaning with the thrust with which it hit him as he caught it. As the halfback who has to carry the ball down the broken field, so far he has not done very much broken field running.

The fact of the matter is there is very little public transit in northern Ontario. The main cities like Sault Ste. Marie and Thunder Bay have public transit and get some modest subsidy, and we have no quarrel about that. But if people have to travel from Thunder Bay to Terrace Bay or from Dryden to Kenora, or if they have to travel in their job as a bush worker living in Thunder Bay to Camp 235 up 60 miles on Spruce River Road, they have no alternative but to go by automobile. While it may also be true in some areas of southern Ontario, it is not true to the same extent as it is in northern Ontario. It is not true when 58 per cent of the land mass is in the five northwestern Ontario ridings. Just think of those distances.

Mr. Eaton: How much of that 58 per cent do you travel across now?

Mr. Foulds: Now we get to the point of transportation. I will make it because the parliamentary assistant from Middlesex urges me to make it at this time. Not only do we not have public transit in most parts of northwestern Ontario, except within the confines of the large cities, nor do we have rail or bus service of any kind in many parts of northwestern Ontario, but in some cases, where we are lucky enough to have roads, the only means of transportation is by automobile. The member for Middlesex says to me we should be grateful we don't have more roads to connect more municipalities.

Mr. Eaton: I didn't say that.

Mr. Foulds: That is what he is implying, Mr. Speaker. My understanding is that for those communities we have to fly to reach there is going to be a tax on aviation fuel, so the price for that will go up. In other words, this tax is inflationary, not only on the consumer who drives his own car, but inflationary in the sense that transportation costs will go up for the people who use public transit.

Transportation costs will go up in those areas where we do not have public transit and people have to rely on private companies such as Greyhound. Where they are not lucky enough to have that kind of service or a regularly scheduled air service through norOntair, they will have to pay additional prices to private air carriers when they have to fly because those air carriers will presumably have to increase their prices to meet the costs of the aviation fuels they use.

In other words, the tax is really a very discriminatory tax. The point I want to make is that the amount of travel that an individual must do in a private auto in northern Ontario is greater and the amount of availability of public transit is very minimal.

I have a simple suggestion which I make to the Treasurer, who is doing me the honour of sitting in and listening to this debate, and to the Minister of Revenue. I suggest they should establish the same benchmark price as the basis for this tax -- a benchmark price based on the area from Niagara Falls to Oshawa to Barrie to Kitchener -- and that should be the benchmark price, the price established for gasoline across the province.

4 p.m.

Mr. Wildman: Is that not what the member for Algoma-Manitoulin (Mr. Lane) wanted?

Mr. Foulds: That is right. That was the suggestion, to equalize gasoline prices across the province, made by the man who is now a parliamentary assistant, the member for Algoma-Manitoulin. I believe we should do that. We can do it for the purposes of this tax because we have the power at the retail level.

Interjections.

The Deputy Speaker: Let us get back to the tax act. Colleagues, please, Mr. Foulds has the floor.

Mr. Foulds: I am thankful for the interjections. They have given me time to have a sip of water, to regroup my papers and to get on with the debate.

If the government can equalize the prices of liquor and beer across the province and if it can establish an equal price considered to be a fair price to base this tax on, then I suggest, as strongly as I can, it is only fair to equalize the price of gasoline across the province. If the government did that, it would be taking one small step to compensate for this particularly blatant tax grab. It has not even taken that step. I would strongly suggest it does.

Does anybody in the world really believe any more there is such a thing as a market price for gasoline? Is there anybody in the world who would honestly say from the bottom of his or her heart and brain there is such a thing as a market price for gasoline? Of course not. There is an Organization of Petroleum Exporting Countries (OPEC) cartel price. There is a federal government-manipulated price, an add-on price for all kinds of things.

There is the federal government combines investigation report that indicated the taxpayers of Ontario had been milked of $4.3 billion by the oil companies. There is the withholding of the production of oil by Alberta. We all know that is artificially pushing up the price of oil. It has nothing to do with the cost of production and nothing to do with the ability or the need to pay. It is a manipulated, controlled market.

This government, which has for so many years railed against that manipulated price, that unjust price on the consumers of Ontario, has decided to get on the gravy train and make use of that price. I suggest that is an injustice to the people of Ontario and a particular injustice to the people of northern Ontario.

What is interesting in the budgetary notes and in the analyses of all the figures I have seen is that the computation of additional tax revenues is based on very small-c conservative estimates. Not only is the windfall of $30 million to $50 million, which has come about because of the recent federal increase, happening to this government, but there will be additional windfall profits. The government has underestimated the amount of revenue it will be getting because the sales of unleaded gas now exceed by far the sales of leaded gas as a result of the mix of cars now on the road. I think the government calculations are deliberately and necessarily conservative.

It is also interesting that in the explanatory note that fact is almost recognized. The note says: "Until the new procedure is implemented the bill provides for specific increases in the tax payable on gasoline. The tax on regular leaded gasoline is increased from 4.6 cents to 5.4 cents per litre. The tax on regular unleaded gasoline is increased from 4.6 cents" -- the same base price -- "to 5.8 cents."

In other words, there is a difference of 0.8 cents on regular gasoline, though we recognize the principle that unleaded gas starts higher. That is going to be built in and in as the escalation continues. I suspect that, instead of the $135 million that is projected for the coming year, the government will see far greater increases than it predicts.

I want to tell the members of a personal experience I had. Not last weekend but the weekend before I had the pleasure of driving to the great prairie city of Winnipeg with my eight-and six-year-old sons, both of whom were participating in the Manitoba open swim championships. My eight-year-old son did particularly well. He came first in all three of the events and was the high point winner for the eight and unders in that event. That was the pleasurable part of the trip.

Mr. Deputy Speaker: You worked that in well.

Mr. Foulds: I am sure the members will allow me to get his name, Andrew Foulds, on the record of these proceedings during this important debate.

We drove across northwestern Ontario, some 400 miles from Thunder Bay to Winnipeg, in -- I admit -- a six-cylinder Ford Fairlane, which is not a particularly luxurious or gas-guzzling car, compared with what parliamentary assistants, Deputy Speakers and cabinet ministers have at their disposal --

The Deputy Speaker: I have yet to see one myself.

Mr. Foulds: What you have to do, Mr. Speaker, is dial on the phone, I think.

In any event, it is not a particularly heavy gas-using car; it does happen to use unleaded gas. What was interesting was the variation of prices from city to communities such as Ignace and Dryden, where the price was something like 41.6 cents per litre before the federal tax increase. One can see how those people living in Dryden, for example, who must travel up to Sioux Lookout or Ear Falls on business will suffer very heavily because of this tax.

This tax adds to the insult of the attack on the consumer: the attack by the federal government, the attack by the producing provinces, the attack by the Organization of Petroleum Exporting Countries cartel. That is the thing we gripe about the most.

Since I come from northwestern Ontario, I am a westerner emotionally and psychologically. All my experience before I was elected to this place was in northern Ontario and western Canada. When I was an 11-year-old boy and the Port Arthur Bruins won the Memorial Cup, we played off with western Canada.

Hon. F. S. Miller: When was that? In 1910?

Mr. Foulds: In 1948.

Mr. Eaton: Don't tell me you were on that team.

Mr. Foulds: No, I was not. I was only 11. If the member for Middlesex incites me to tell him a few sporting stories when I was in minor league hockey, I can --

The Deputy Speaker: No, he was not.

Mr. Eaton: With the shape the member is in, he could not have been an athlete.

Mr. Foulds: Oh yes.

Mr. J. A. Reed: Those hockey players had to drive to games.

Mr. Foulds: No, I was a goaltender and I used to walk carrying my own pads. Anyway, that is another story for another day in a different debate.

Mr. Eaton: How come the member never comes over to the Gardens when we play?

Mr. Foulds: If the member really wants to know -- Mr. Speaker, am I allowed to answer that diverting question in the tightness that you have ruled in the debate on this matter?

The Deputy Speaker: "Free wheeling" is the term.

Mr. Foulds: This freewheeling debate. Actually, my reflexes are not what they used to be. As a goaltender, I made the mistake in one game of stopping a penalty shot with my eye. I have subsequently worn glasses. I do not think that is a particularly good thing for a goaltender to do, even in a scrub game with the honourable members opposite and with the members of the press gallery, who might be particularly vicious. Anyway, I still skate once in a while.

4:10 p.m.

Where was I? I have been diverted at this point. I think the member for Middlesex has done his job.

There are three major points I want to make, if I may sum up. How long have I spoken, Mr. Speaker?

Mr. Speaker: Half an hour.

Mr. Foulds: Half an hour? Actually, I meant to speak only about 35 minutes; so perhaps I could just wrap up.

This tax is unfair for three major reasons. The tax is on top of taxes already. For example, people who live in northern Ontario, who have no other mode of transportation and must use extra fuel because of the long distances involved, are doubly hit because of the base amount of gas they must pay taxes on.

Although there is an equalization of the rate of taxation involved in this bill for northerners, there is no equalization of gasoline prices; and that is not compensated for in any way by the low $10 licence fee that northerners pay. A person like myself living in a largely urban area drives between 12,000 and 15,000 miles in a year; and that is not counting any long trips -- maybe one in a year, down here, at the most.

Mr. Eaton: I drive more than that in my area.

Mr. Foulds: Of course my friend does. I do not drive that much. That is the point I am making. The extra taxes I pay on the amount of gas that I consume more than account for the differential between the $10 northern Ontario licence fee and the regular licence fee in southern Ontario; so that is not any compensation.

In other words, this is a crass political tax. It increases transportation costs. It increases food costs, particularly to those of us in the north where transportation is built in as a cost of consumer goods. And it does absolutely nothing in getting additional revenue for the province to provide for compensating programs to the electorate. All it does is help the Treasurer keep his budgetary deficit to two thirds of what it otherwise might be.

In other words, as we have seen all too freely, the promise of March 19 has turned into the arrogance of May 19 and subsequently. We had an arrogant budget that thumbed its nose at the consumers and the people of the province and said quite crassly: "Last year, I gave you a Christmastime, pre-election budget. This year, I am giving you a sock-it-to-'em budget -- a budget that deliberately taxes you where it hurts."

I am paraphrasing the Treasurer in saying, "The jingles of March 19 will be used again over the next four years, using your money for government advertising and to persuade you that things are fine in Ontario and that we should preserve it, conserve it," and all that nonsense. He is saying: "We will be using your money" -- raising taxes like this -- "to persuade you that these taxes are not such a bad thing. Then four years from now, in the year just before the election, we will give you another Christmastime budget."

That is the message of the budget. That is the message of this tax. It is a crass political tax. It is one in which the government has dipped its hand into the pockets of the taxpayers shamelessly. I for one oppose it and will oppose it as strongly as I can.

Mr. J. A. Reed: Mr. Speaker, I have to say at the outset that I rise in this debate with the greatest possible disappointment I can register in this House. I am deeply disappointed in the hypocrisy demonstrated by the government over the five years I have had the privilege of being the Energy critic for the official opposition.

Four Ministers of Energy ago, when the member for Don Mills (Mr. Timbrell) was minister, our party brought out a paper just prior to my taking on this portfolio; it called for a staged increase in the price of motor fuel. We recognized that the price was going to escalate much more quickly in years to come and that escalation would impose a severe economic hardship on industry, commerce and the people of Ontario.

Hon. Mr. Ashe: Is that when you were supporting the world price, or before?

Mr. J. A. Reed: Let me get to it. The paper we brought out in 1976 called for a staged move towards the world price. As a matter of fact, it said plainly, and perhaps the minister should read the copy again, not to the world price.

We understood the price was going to increase but, if it was staged as evenly as possible over the time frame that those increases were expected to occur, we could end up triggering conservation and triggering the move into alternative energy forms at a point much earlier than we now have.

The minister's response, I suppose, had to be predictable on the day, because it came shortly after there was a price increase. It will be recalled that Ontario recognized the politics of that price increase and that the then Minister of Energy, the member for Don Mills, put a freeze on price increases and declared Ontario would fight price increases in motor fuel. That position became the policy of the government of Ontario, and it continued with that policy up to about a year ago.

The present Minister of Revenue (Mr. Ashe) has said, "You are the people who wanted world prices." That was what the Premier (Mr. Davis) and the Treasurer (Mr. F. S. Miller) repeated time and time again in the House. I believe the Minister of Revenue repeated it time and time again as well. It was inaccurate but it was designed to serve a crass political end that this government had set out to curry, and it made a lot of hay in the short term by doing so.

The result has been another story, because in the past 18 months the price of gasoline in Ontario has risen by about 60 cents a gallon.

Now that the triggering of conservation, the triggering of a move into renewable energy is coming on --

Hon. Mr. Ashe: It is your federal counterparts.

Mr. Ruston: You people should have supported Joe Clark.

4:20 p.m.

Mr. J. A. Reed: Mr. Speaker, it is difficult when these exchanges take place. I realize how tempting and difficult it is for the members on this side to remain quiet when one is addressing what is one of the worst hypocrisies that has ever been perpetrated on the people of this province.

Let me go back. Here is a statement of April 1, 1977, given by the member for Prince Edward- Lennox (Mr. J. A. Taylor). He was another Minister of Energy who got bounced at some point or other. In a speech given to an energy ministers' conference in Ottawa he said, "First, we are opposed to any increase in the price of oil and natural gas." Well, let us see what other goodies --

Mr. Eaton: Do you want to look at some of the things you have said that you changed positions on?

Mr. J. A. Reed: I wish the member would go back and read the Hansards again. I wish he would read the things I have said. He speaks next and will get in on it; he should research exactly what this party has stood for over the last five years. My friend will find that we have stood in the vanguard of every move into new energy. We have urged the government to get on with issues that five years ago were considered to be pie in the sky. As a matter of fact, I will show him an interesting thing.

I remember a debate we had in 1978. We had done an interesting study on fuel alcohols and said they were feasible for the people of Ontario. This government did a study the same year and said it was not feasible. The federal government had done a study the same year and said it was feasible; all these technical arguments were put forward and all the rest of it.

Here is an interesting article from the Canadian Renewable Energy News of June 1981. It tells about a light-alcohol-powered plane that has been flown in the United States. It is being flown by an ex-astronaut, Gordon Cooper, and a Mr. Bill Payntor. They are finding that fuel alcohol in aircraft is far superior to petroleum, because the efficiency of combustion increases with the altitude attained. It is now being seriously looked at as a replacement for jet fuel.

This is in place. This is operating. Members should know that. I do not know whether any other members were down at the Ford Motor Company display two weeks ago, but we were driving an ethanol-powered car, a methanol-powered car, a propane-powered vehicle, and a vehicle powered by compressed natural gas. The Ford Motor Company said there was no technical obstacle to bringing any of these fuels into general use.

Hon. Mr. Ashe: Technically, that is right. Don't worry about the economics as long as it is technically correct.

Mr. J. A. Reed: The honourable member talks about worrying about the economics. If he would read his own Ministry of Energy publications, he would find that methanol on this day, June 9, 1981, is competitive with gasoline. That is according to his ministry. Whether it is right or wrong, that is according to his ministry.

Let me go on. Here is a dandy. On November 20, 1978, in a statement to the Legislature concerning the federal-provincial energy ministers' conference, the Honourable James Auld said: "Ontario has long recognized the direct relationship between price increases unrelated to the cost of production and these economic consequences." How many more? Maybe I will get one from the Premier.

Hon. Mr. Ashe: They have all been read before when you weren't here to hear them, Julian.

Mr. J. A. Reed: All right. We will get some. Here is one.

Mr. Stokes: Why don't you get one from the former parliamentary assistant?

Mr. J. A. Reed: I probably have one of those here too. Here is the Premier speaking to the Ontario Progressive Conservative Campus Association on September 15.

Hon. Mr. Pope: Your colleague just read that.

Hon. Mr. Ashe: You should read Hansard. That was read by your colleague who spoke previously.

Hon. Mr. Pope: Go ahead; read it again anyway.

Mr. J. A. Reed: It was just read? That is fine. It is not bad to read it again, because it is comes from the most hypocritical government that has ever been foisted on the people of this province.

Here is the Premier speaking in 1979: "I believe that if we were to have a massive move to world price, the kind of harm it would do to our economy would not only ensure that we followed the Americans down the road to recession, but that we did considerably worse."

Hon. Mr. Ashe: That is exactly right. Read it again.

The Acting Speaker (Mr. Cousens): Order.

Mr. J. A. Reed: If the Premier is correct, then it is obvious this government is in favour of bringing a recession to the province. It is as simple as that. The members opposite play politics --

Mr. Eaton: You just said a minute ago that your party wanted world price.

Mr. J. A. Reed: No, no. I will say it again. I wish that before the member makes those comments he would go back and read the release of 1976. What we said was that we favoured the staged increasing of petroleum prices towards world price, but not to world price.

Mr. Eaton: I heard what you said a minute ago.

Mr. J. A. Reed: We said that in 1976. It is in the statement. If the member wishes to rise in this debate, he has a chance to counter that in any way he can. I will bring the text into the House afterwards and rise on a point of personal privilege and read it into Hansard in its entirety if that is what he would like me to do. But the member should not try to misconstrue statements to suit his own political end, which is what he was doing.

While the government was in a minority situation, it was great to play on this thing as long as it could read the polls and as long as it could string it out. Now the chickens have come home to roost, but it has been saved because it has a majority.

During the first few months it is socking it to the people at every turn and saving the corporate tax increases until just before the next election so that it can come along and say: "Look, boys, we are playing Little Jack Horner. Here's the plum. What good boys are we. We have not increased the taxes to the people of this province for a year, a year and a half or however many months." It has done it before; it will do it again. It is the same old dodge. The government should be ashamed of itself.

The ad valorem aspect of this tax on fuel is the ultimate hypocrisy, because all through those years the government and its leader yelled at the Energy critic across the House, at my leader and at all the rest, saying: "You are the people who want world price. You are the people who want all these things."

The government know very well that, had it started on gradually staged price increases when it should have, it would have had our support here on this side. We asked the government to do it. If it had started with that, it would have triggered the options at a much earlier time and in a more rational way, because the rules of the game would have been clearly known.

Now we are faced with this massive escalation. There is almost a sense of panic there as to where it is going to go. The price has risen by 60 cents a gallon in 18 months, and now the government is riding on the back of it with this ad valorem tax.

Hon. Mr. Ashe: And where did that come from? A hypocritical Liberal federal government.

Mr. Ruston: Your Conservative friends in Alberta caused it.

Hon. Mr. Ashe: They publicly opposed 18 cents.

Mr. J. A. Reed: This government takes more from a barrel of oil than does the Alberta government.

Hon. Mr. Ashe: No, we do not. Your arithmetic is as bad as that of the member for Port Arthur (Mr. Foulds).

4:30 p.m.

Mr. Foulds: On a point of personal privilege, Mr. Speaker: My mathematical ability has been called into question. I admit I am not very good at algebra; I only got a B plus in geometry; but I am superb at arithmetic, particularly at the grade five level, which is all the minister is capable of.

Mr. J. A. Reed: Mr. Speaker, we also said that if there were to be tax increases in petroleum, our party favoured the designation of those tax increases for specific drives to energy self-sufficiency.

My party has long believed that Ontario has the potential for energy self-sufficiency right here. Five years ago, we told the government they were a decade behind already at that time in the development of alternative energy forms.

We have continually stood for the development of new energy sources in every conceivable way on the broadest possible base, only to be laughed at initially. I can hearken to the many sets of estimates I have sat through under many Ministers of Energy and recall being virtually laughed at and told that many of these technologies were not feasible.

Mr. Eaton: You were funny at times, Julian.

Mr. J. A. Reed: Perhaps the member for Middlesex (Mr. Eaton) can recall sitting in with the member for Don Mills (Mr. Timbrell). I talked about that first great renewable resource in Ontario, hydraulic power, and was told it was all a bunch of garbage because it was far too expensive to develop.

Mr. Eaton: Nobody called it garbage.

Mr. J. A. Reed: I can recall talking about many of these other options. As recently as 1978, I talked about fuel alcohol production, because Ontario probably has more potential for fuel alcohol production than any other single thing. Certainly it has more potential for that than for any supposed petroleum resources that may lie in Hudson Bay or James Bay, although there may be some there and we hope the government will explore those areas.

The fact is that we know we are not going to hit a dry hole when we spend the money drilling for renewable energy. We know the answer. We know it is there. If we have to sort out economics on certain things, we know roughly where those economics are and where they will be as the price of petroleum changes and increases.

As I said earlier, as of today methanol is competitive with gasoline, at least according to the government's assessment of it. A very few years ago we were told it was pie in the sky.

Ethanol is a little more expensive, but the price of gasoline is escalating; in 18 months, it has escalated 60 cents. Will ethanol be competitive in August? Next January? Next June? We could not possibly get production facilities under way in that short a time, yet we know those lines are going to cross.

What about some of the others, the ones that are considered a little more exotic? There is an interesting example on page two of the June 1981 Canadian Renewable Energy News: "Pictured in Louisville, Kentucky, Harold Lafontaine's biogasifier, towing Lincoln, is immune to petroleum shortages." He is simply using a woodgasifying machine, delivering a performance on his very big Lincoln of 3,200 miles per cord of wood.

That may sound a little pie in the sky too, but does the minister know that there were 75,000 wood gasifiers in operation in Scandinavia during the Second World War? Does the minister know that the technology has been further refined and developed by at least two European firms that I am aware of and probably by many more? How many has the ministry actually looked at? Does the minister know that one of the earliest gasifiers was built right here in Canada?

We have the resources to utilize some of these things. Something like wood gasification is not everybody's cup of tea and it is not going to fill the need for a liquid fuel alternative. But it certainly fills the need for a shortage when there is no alternative.

All of these things, where the technology is well known and well in place, have been put on the back burner by this government. Instead of developing the energy potential that is available in Ontario, they have put all their eggs into the electric power basket and decided with great determination to bring on a new electrical age in Ontario, one that somehow will circumvent the need for storable liquid fuels.

I do not know how they are going to do it. Maybe they are going to build huge extension cords for aircraft or trucks. Anybody in this Legislature knows very well that electric power will not be the ultimate substitute. We will need various energy forms, especially if we are going to be the least bit concerned about qualitative conservation.

The government talks a lot about conservation. They sing a lot about it on the radio and spend a tremendous amount of money promoting it. Yet they talk about using the electric power option when electric power applied to transportation in terms of supplying some kind of storable fuel would be a wasteful thing from a conservation point of view. It is much more efficient to produce a liquid option.

We do not have the petroleum in Ontario, but we do have these other potentials. We have this great potential for methanol which is sitting there now. As the technology progresses -- and I have one example of the technology here today -- we will have the potential for using that same cellulosic waste for producing ethanol. So methanol may not be the fuel of choice in the future; it may be ethanol.

Here is some literature from one of the companies that is among the world leaders in converting lignocellulose.

The Acting Speaker: This ties in to Bill 72?

Mr. J. A. Reed: Of course it does.

The Acting Speaker: I'm just asking.

Mr. J. A. Reed: Mr. Speaker, the reason this bill needs to be debated is that this ad valorem tax goes on without any designation whatsoever. The people of Ontario at least could be persuaded reasonably to swallow it if it were earmarked, but the government does not even do that. It is riding on the backs of the people to try to reduce the deficit and would not dare commit itself to some of these options that give us the opportunity to restore Ontario's economy and to provide employment in areas of Ontario where it is so badly needed.

I wish they would think a little more about the potential for the employment of thousands in the north, in eastern Ontario, in the less-settled areas of this great province and about what it could do for those places and for our security of energy supply.

I cannot conceive of the rationale that has gone into something they call an energy policy at present. It becomes even more compounded when they would lay on this ad valorem tax and earmark not one nickel of it for what is the logical energy future in Ontario; that is, renewable energy development and conservation.

Quite frankly, because of this lack of commitment, we have become the most vulnerable province in Canada. When one thinks of the resources available in other areas and the amount of industrialization Ontario has, would like to continue to have and would like to expand upon, one cannot but be deeply concerned about this lack of commitment.

4:40 p.m.

Industry in Ontario now is highly electrified. That is as it should be. Electric power turns the motors of industry very well. But there are many other energy-demanding elements that go well beyond the ability of electricity to provide efficiently. The only province I can think of that perhaps has less potential in energy than Ontario is Prince Edward Island. Even Prince Edward Island is doing something about it; it is getting serious.

It is a disappointment to have to talk about this tax that is being placed on the backs of citizens and will rise according to price increases Ontario does not control. It will allow them to profit in a windfall manner.

Finally, they have no commitment to use that money directly in the production of the energy resources available to the people of Ontario.

The government has failed the people of Ontario badly. The only way they might redeem themselves in this situation would be to withdraw that tax. I see no other option.

If they want to place a tax on fuel to finance road maintenance and construction, which they always had before, that is fine. Let them introduce it as a direct measure of taxation and we will vote on it in this Legislature, for better or worse. But the ad valorem prospect is the killer because with each increase in the price, which is created outside the jurisdiction of this province, their take automatically increases.

If I have a message to bring to the people of Ontario during this next term, it will relate largely to many of the things I have said this afternoon about the hypocrisy and about the four to five years spent not on capitalizing on recognizing some realities about the energy future but simply in playing politics up and down the street.

Now, when the chickens are coming home to roost, they are foisting one of the worst possible economic evils on the people of this province.

If all the things said by the Premier, the Treasurer and the various Ministers of Energy who have come and gone in the past were true, then this increase we have experienced and the added tax those fellows are putting on will have a resounding effect on the economy of Ontario. Sixty cents in 18 months will have a resounding effect; obviously it will be felt by this fall or by the end of this year.

According to their words, ones repeated so many times before, the effect will be disastrous. They will be aiding and abetting a party that is manufacturing that destiny. When it comes along, if they do not rescind this tax we are going to remind them of it, and we are going to remind the people of Ontario of it time and time again until the next election.

As Energy critic, I have attempted to be objective as much of the time as I possibly could, to be realistic as much of the time as possible. I have attempted to be fair. I have attempted to praise the government where the government needed praising. I have attempted to encourage it where it needed encouraging, where it knew there was some political risk involved but where, by joining forces, common sense would prevail. But this hypocrisy is one of the reasons that I am very glad to be on this side of the House representing this party.

Mr. Foulds: Mr. Speaker, I do not believe there is a quorum.

Hon. Mr. Ashe: In other words, your speaker isn't here.

Mr. Speaker called for the quorum bells.

Mr. Cassidy: Mr. Speaker, I wish to thank the government members for joining in this debate, at least to participate. I recall a week ago Monday when they fled the House in such numbers that --

Mr. G. A. Taylor: It's time to leave now, fellows. Irrelevant material now is being put forward.

Mr. Cassidy: Irrelevant? I will tell my friend what is irrelevant. Here is what the then Minister of Energy, the member for Ottawa West (Mr. Baetz), had to say back in 1978 at a time when a $1-a-barrel increase was being suggested and the Ontario government opposed it.

He said at that time that it was inappropriate and that Ontario was making strong representation against that increase in the price of oil, which includes the price of gasoline. He said you should not increase the price of gas and oil while the Canadian economy is soft, when unemployment is high and when inflation is still not under control.

The situation has not changed one iota between that time in 1978 and today. Today we have inflation definitely not under control. We have inflation at the highest rate in the last 30 years. We have a rate of unemployment in Ontario that continues to hover around 300,000 men and women. We have a situation where the economies of both Ontario and Canada are soft.

There is a former Minister of Energy here, the member for Prince Edward-Lennox (Mr. J. A. Taylor). He will recall the number of times he opposed increases in the price of oil because of the economic impact they would have had on this province.

I ask myself: If that minister was right at that time, and if the member for Ottawa West was right at the time he opposed increases in the price of oil at the national level when he was the Minister of Energy, then how is it that these Conservative members now can be endorsing an increase in the gasoline tax that, on a per barrel basis, is greater than the increases they opposed a year or two years ago?

4:50 p.m.

I ask my friend the member for Prince Edward-Lennox to consider that the increase imposed by the Treasurer (Mr. F. S. Miller) in his budget raised the tax on gasoline in one jump from 4.6 cents a litre to an average of about 5.8 cents a litre. That will be the cost on unleaded gasoline, which is the major product on the market right now; it will be a bit more for premium and a bit less for the leaded gasoline for those cars that can still use it. This is an increase of 1.2 cents per litre, which is equal to an increase of about $1.92 per barrel.

But when the member for Prince Edward-Lennox was the Minister of Energy he was saying what damaging effects an increase of $1 a barrel would have on the Ontario economy in terms of how it would translate into the price of gasoline and oil here in Ontario.

Admittedly, this increase is only on gasoline and not on heating oil. But, given the fact that gasoline is 30 per cent of the consumption of oil in Ontario, we are talking of something that in one year is equivalent to what the member, when he was the minister, opposed so adamantly. Then look ahead to next year, 1982. The estimates we had from the Treasurer on budget night indicated an increase of another 1.8 cents a litre as a consequence of this new gasoline tax, the ad valorem tax that the government of Ontario is using its majority to ram down the throats of the people of this province.

That translates into the equivalent of a further $2.88-per-barrel increase in the price of gasoline. It is the same as though they increased the price of oil by $2.88 when it gets down to the pocketbooks of people who drive, who have to pay transit fares or who have to pay for trucking in Ontario.

In 1983, the increase will amount to a further ninety-four one hundredths of a cent per litre. That does not sound like a lot, but remember that song about, "Seven and a half cents doesn't mean a hell of a lot, but give it to me every litre"? At 4,000 litres per average car per year, if I can paraphrase the Broadway musical, it does amount to a hell of a lot of money. In 1983, that amounts to a further $1.50 per barrel.

If one adds a $1.92-per-barrel increase in 1981, a $2.88-per-barrel increase in 1982 as a consequence of this tax and another $1.50-per-barrel increase in 1983, and then translates that for those of us who still understand gallons better than litres, believe it or not, it means a tax increase of 18 cents per gallon by the Conservative government of Ontario over the three years.

I call on the member for Prince Edward-Lennox and his colleagues to recall that at the time of the budget of the former federal Minister of Finance, John Crosbie, in December 1979, the increase that was imposed and the excise tax the Tories proposed was 18 cents a gallon, precisely what the government intends to make over the next three years as a consequence of this tax.

At that time the government was so adamantly opposed to this that the Premier and the Treasurer damned John Crosbie and then Prime Minister Joe Clark up and down, backwards and sideways, to the point that the Treasurer's statements were actually used by the federal Liberals in their advertising in the election campaign.

The Conservatives at that time were so appalled by the federal tax increase proposed by the Clark government, by their fellow Conservatives, that they actively supported the reelection of the federal Liberal leader, Pierre Trudeau, rather than see Joe Clark and John Crosbie impose that increase of 18 cents per gallon on gasoline.

Why is it that an increase of 18 cents per gallon on gasoline that was so wrong for Canadians in Ontario in 1979, according to the Ontario government, now becomes so right that the government is prepared to impose it with a tax that allows Ontario to piggyback its gasoline tax on the basis of every other increase that is proposed?

Ottawa recently announced an increase of 1.5 cents per litre, an increase imposed by the federal government partly because of the added costs of imports caused by the cutbacks in Alberta and partly, I believe, because of the acquisition of Petrofina by the public sector.

That measure by Ottawa led in turn to an automatic piggybacking by Ontario that was equivalent to a further increase of 50 cents per barrel in the price of gasoline taken by this government. That indicates just how far the government has gone from the adamant opposition it was putting up to gas tax increases just a few short months ago.

This comes on top of a budget that is so unfair, so biased, so blatantly pro-corporation, pro-investor, pro-Bay Street, pro all the fat cats in Ontario society and so blatantly anti the interests of the working people of Ontario, so blatantly opposed to the interests of the loggers, the miners and the people who live in northern Ontario.

It is also opposed to the interests of the people in eastern Ontario who have to drive long distances to go shopping or to their work and who do not have public transportation the way it is provided in Metropolitan Toronto.

When it is coupled with a budget that takes nothing from corporations and $600 million from the ordinary people of the province, I am surprised there are not a few Conservatives prepared at least to speak up and say what they secretly feel, even if they are not prepared to vote against the Treasurer.

5 p.m.

The member for Prince Edward-Lennox has a seatmate, the member for Renfrew South (Mr. Yakabuski), who had the temerity the other day to raise a question as to why bank profits were so high. I congratulate the member for Renfrew South. He has seldom shown that kind of independence.

But I wish there were a few Conservatives who realized that when there is a majority situation it is in their political interest to stem the arrogance of the cabinet and to help keep the cabinet honest by indicating what their constituents are telling them.

The member for Prince Edward-Lennox knows he has almost no public transportation in his riding. His constituents have to drive long distances. His constituents agreed with the New Democrats and agreed when he and the Minister of Culture and Recreation (Mr. Baetz), the Minister of Energy (Mr. Welch) and the Premier (Mr. Davis) at various times expressed opposition to the efforts to increase gasoline and home heating oil prices.

The member for Prince Edward-Lennox knows that is the opinion of his constituents; so why, for a change, does he not side with his constituents now to keep the promise he made to them, rather than going along the flip-flop route of the Premier, the Treasurer and the rest of the cabinet?

Is it not about time that we had some honest dissension on the Conservative side rather than this sheep-like conformity, this blue-tinged flock that goes along with the Treasurer and the Premier? Whenever they are told to jump, they jump. Whenever they are told to leap, they leap. Whenever they are told to levy another tax and sock it to the working people of the province, they go ahead and say: "Ready, aye, ready, Bill. We think you are right 1,000 per cent."

What we are getting now is what we get from a majority government. I suggest that the flip-flop that has occurred right now can come for only two reasons, one of which is hypocrisy and the other being cynicism.

I am not sure whether the hypocrisy and cynicism began after March 19, when the government got back its majority, or whether the hypocrisy was with the government during all of that period when it purported to be opposing the increases in oil and gas prices being proposed by the federal government and the Conservatives in Alberta.

Listen to this statement: "Our government is not working for windfall revenues from higher prices" -- that would suggest the speaker was opposed to any tax that moved up automatically as other prices or taxes at the federal level or at the Alberta level were increased -- "and the federal government should not be entertaining that idea either."

That was a statement by the Premier at the first ministers' conference on oil and natural gas policy on Monday, November 12, 1979. The passage of a year and a half has certainly changed things.

The Premier said that at a first ministers' conference; and, to make it even worse, he said it on television. I have been around this country long enough to know that if people see a politician saying something on television, then they have to believe it. Is that not what they were saying with the "Keep the promise" campaign? There was the Premier all through the election campaign saying: "I have kept every promise I made in the election campaign, every one I have been able to keep. Give us the government, and I will complete the rest."

There he was, larger than life, sitting in the conference centre in Ottawa along with the premiers from the other provinces, the premier of the largest province in Confederation, saying solemnly to all the people of the country that our government was not looking for windfall revenues from higher prices.

I sent my 13-year-old child off on a school trip this morning. He was going to the United States, as it happens, because his school was going down to Cape Cod.

What do I say to my child if he comes to me when he comes back and says: "You know, Dad, I was reading in the papers in the United States about these politicians who never tell you a straight story, who make a promise at election time, but then they change their promise. They will not keep their promise and they are just a bunch of crooks down there"?

Mr. Kerr: Is he sitting on your knee?

Mr. Cassidy: He would be too big for that.

What will I say if he says to me: "Say it ain't so. That is not the case up here, is it?"

What will I say if he says to me: "You know, Dad, I remember the day that the Premier appeared at that first ministers' conference up in Ottawa. I remember because I was home sick from school that day, and I heard the Premier of Ontario say that our government is not looking for windfall revenues from higher prices"?

Then if he might say to me: "Why is it that a day or so after that budget, when we drove in the car to the gas station, the price of the gasoline was up by a 1.5 cents a litre and the sign at the gas pumps said, 'The tax increase you have to endure today is courtesy of Frank Miller and of William G. Davis, Premier of Ontario?' Isn't that a windfall profit that is coming?"

What do I say to my son then? How do I assure him that as a politician I am dealing with honourable men and women in the Legislature of Ontario when a statement that was made so clearly just 18 months ago is apparently not to be the case today because the Premier of the province gave the authority to the Treasurer of the province to change his mind?

How do I explain that, rather than fighting the increases in oil and gasoline prices, rather than being part of a solution and helping to maintain a situation of having a made in Canada and made in Ontario oil and gasoline price, the Premier, the Treasurer and all of the Conservative majority government moved from being part of the solution to being part of the problem? What hypocrites they are. What a bunch of cynics they are.

What do I say if my son comes back to me and says, "Did the Premier mean what he had to say back in 1979, or was he clinging to power at that time by saying what he thought people wanted to hear to avoid an election over an oil and gas policy that was designed to benefit Imperial Oil, Texaco and Gulf -- all those great Canadian-owned companies"? It was designed to benefit all of the oil multinationals and to allow them to increase their profits and to take them out of the country, but the Premier did not want to say so in public for fear that the government would be plunged into an election before it thought the time had come.

Keeping the promise surely means holding to what they said or, at the very least, having the good grace to explain why it is that they decided to change their mind. There has been no explanation. There has been no rationale. There has been no justification. There has not even been an excuse. It has just been a bare-faced grab into the pocket of everybody who has to drive a car in the province and nothing more than that.

The Premier went on to say: "I am well aware that finance ministers like to operate on their own as best they can." That sounds like fiscal irresponsibility to me. "However, it would be unconscionable for the federal government not to return honestly all discretionary new revenues back to the people. This cannot be fudged, particularly in the case of low-income families and those who have no immediate option but to continue to use the automobile and the oil furnace."

I will repeat that. My son believed him at that time but boy, never again; they have made him a New Democrat for life and into the grave. The Premier of this province said: "It would be unconscionable for the federal government not to return honestly all discretionary new revenues back to the people. This cannot be fudged, particularly in the case of low-income families and those who have no immediate option but to continue to use the automobile and the oil furnace."

Fudged it has been, to the point where this government now intends to take 18 cents a gallon in increased taxes on gasoline from people who drive cars, low-income and high-income people alike. It begins this year with no advance notice and no opportunity for them to change their driving habits. In many cases they have no alternative but to use private transportation because public transportation is not available.

5:10 p.m.

That has come from the same Premier who said the federal government should take all the discretionary new revenues it was getting from increased oil prices and hand them back to the people. Where are the actions of this government in handing that money back to the people? The answer is they have made no such action at all.

Here is a government that talked about international oil price increases being intolerable and saying, in the Premier's words again, "It would be a serious dereliction of duty to the people and to the future of our country to deny protection of people in this country against those oil price increases by the sheikhs of Arabia, of Mexico and of Venezuela."

Now we have the sheikhs of Toronto. They are located at Queen's Park. Eighteen cents a gallon is coming out of our pockets, not because of Peter Lougheed, not because of Imperial Oil and the rest of the Seven Sisters, and not even because of Maurice Strong and Petrocan. It is coming because of the actions of the Tory government of Ontario.

The Premier said, "We have an opportunity to cut ourselves loose from American oil price increases." He has acted as vigilantly on that one as he has been acting to cut us loose from American increases in interest rates.

The Premier said the oil price proposal which was then being negotiated appeared to be "an excessive and imprudent response to the claims of the producing provinces and the petroleum industry."

I think Peter Lougheed is to be congratulated for the restraint he has shown since Ontario decided they would join the tax sweepstakes for gasoline as they did a month ago. What the Premier had to say at that first ministers' conference in November 1979 could apply every bit to Ontario's actions and be used as words by Peter Lougheed today.

Hon. Mr. Ashe: You said that. You sound like a broken record.

Mr. Cassidy: I want to congratulate the Tory members for staying here in larger numbers than they did a week ago Monday. They have obviously learned something.

Mr. Eaton: Someone had to have the bell rung so you could get in to make your speech.

Mr. Cassidy: The Liberals collapsed and were speechless; that was his problem.

In November 1979, this government criticized the proposal for a 30 per cent increase in excise taxes in the transportation sector. It criticized the $4-a-barrel increase proposed under Joe Clark's national energy policy. Now the increase proposed by this government will amount to half of what they criticized then.

The government said in November 1979 that the increases the government of Canada was proposing would risk a national recession. An increase is an increase is an increase. We can get a recession in Ontario as a consequence of a provincial tax hike every bit as much as we can get a recession as a consequence of a federal tax hike.

The Premier warned us a year and a half ago. He said, "The only thing we do know is that a massive increase in the price of oil can stall economic activity and slash employment growth." Anybody who votes for this gasoline tax increase is voting for a measure that will stall economic activity and slash employment growth.

In this debate I decided I would not write my own speech; I would simply quote the speeches made by the members of the government, because they say it all. The hypocrisy of the government is showing because they decided to change their minds and grab this money from the taxpayers of Ontario.

The Premier said increased prices do not have a big impact on consumption in this country, because "our rate of oil consumption is determined essentially by our unique needs. Our distances are great."

Has this government done anything to reduce the distances that people are going to have to drive in the great province of Ontario? Will it not continue to be more than 1000 miles from Kenora to Toronto by road? Will it not continue to be 265 miles between Ottawa and Toronto by road after this tax is increased? Will it not seem even further if we measure the distance in kilometres?

Mr. Laughren: Come to Shining Tree.

Mr. Cassidy: That is right. It will be 485 kilometres to Shining Tree, if you are lucky.

Mr. Laughren: That is from West Shining Tree.

Mr. Cassidy: That is from West Shining Tree. When you measure it in litres per kilometre, it is even worse.

The Premier said that our resource industries are energy-intensive. Is there going to be a change in that? Are we going to stop having a forestry industry, a basic steel industry, a mining industry? These are the industries on which our economy is based. They too are heavy users of gasoline, and they are going to have to pay the extra cost that will be a penalty in terms of economic activity and in terms of jobs.

The member for Middlesex is sitting there putting his hand up and down as though he wished he could enter this debate, except that his House leader or House whip has told him not to. I suggest that, rather than gesturing ineffectually the way the member is doing right now, he should calculate the cost for the farmers in his riding who have to pay extra in fuel costs for farm trucks and who have to pay extra in terms of gasoline costs for all the other gasoline-powered equipment on their farms.

The member should think of what that is going to mean for farmers who are driven to the wall because of the high interest rates right now. How many more of his constituents will risk being driven into bankruptcy, will risk facing the fate of Henry Friesen who tomorrow or the next day will have the Bank of Montreal's auctioneers come to his farm at Mildmay and sell everything off because between the increased costs and the inadequate returns, Mr. Friesen, who is a career farmer, cannot afford to maintain his interest payments and stay in farming?

The member for Middlesex knows just how many thousands upon thousands of litres of gasoline the average farmer needs today to stay in business. On every one of those litres that farmer is going to be paying an extra 1.2 cents in 1981, an extra 1.8 cents in 1982 and an extra 0.94 cents in 1983; and every year thereafter there will be further increases on what that farmer will pay.

Interjection.

Mr. Cassidy: What the member says is, "Who is going to fight for purple gas?" and that is the way the farmers are going to get around it.

Mr. Eaton: Don't put words in my mouth. I didn't say that.

Mr. Cassidy: That is exactly what the member was saying. Or blue -- it will be blue gas, and every gallon is going to have a little label saying: "This blue gas was brought to you by the party whose distinctive colour is blue."

Hon. Mr. Ashe: Good suggestion. We'll take it under advisement. Why don't you understand the problem?

Mr. Cassidy: Yes, he probably will. The Minister of Revenue (Mr. Ashe) is obviously going to get the program going. I have heard that he has cornered the market on blue dye and that there is none left for any other province or state that wants to follow that particular program.

I want to suggest that there are workmen who work the 6 a.m. shift at Stelco and have no choice -- because the Minister of Housing (Mr. Bennett) cannot provide housing for them near their work -- but to get into their pickup trucks or their cars and set out for work at 5:30 a.m. and drive 15 or 20 miles each day, each way, to and from work. For those workers, the gasoline they have to use is every bit as essential as is the gasoline that the farmers use, but the farmers are going to get special treatment.

Why is it that they distinguish that way? And why is the member for Middlesex not prepared to admit that if the farmers deserve a break because gasoline is essential for their needs, so do people who have small businesses need that kind of a break? People who are forced to commute long distances also deserve a break. So do people who have to work unsociable hours, our hospital workers, for example, who have to come on shift at two in the morning, or at 5:30 or 6 am., for whom public transit is not an alternative even if they live in the major cities where public transportation is generally available.

In all of those cases the use of a private automobile is not a luxury; it is an essential need if the worker is to carry out his or her duties.

5:20 p.m.

But this government simply says: "We will find some groups like the farmers to whom we will give special treatment, since we can identify their vote and try to keep the promise with them and keep them in the fold in 1985. But as far as the broad measure of small businessmen and working people in this province are concerned, we will put them against the wall with this 18-cent increase and the promise of an ad valorem increase that will continue year after year after year."

I am reminded of that quip in Love Story where they say, "Love is never having to say you are sorry." A good tax for Tories is never having to say you are sorry or to come back to the Legislature to get legislative approval.

They do not like bringing tax increases to this place. That is why they increase Ontario health insurance plan premiums every year. That is why they have put on this ad valorem tax; so that it will generate new revenues year after year after year. It does not matter that the Premier said it was a bad tax. Now they have decided to get on the gravy train and become part of the problem in the increase of oil prices in Canada.

Let me go on with what the Premier had to say. He said in November 1979: "Ontario insisted that massive price increases would be unjust, unnecessary and damaging to the Canadian economy, if not to the fabric of Confederation."

It appears that the Premier was really saying -- this is where my son was obviously deceived -- that a tax or price increase is unjust when it is imposed by Allan MacEachen, by Mervin Leitch, by the government of Alberta or by the federal government. But take the same dollar value of a tax increase and make it an Ontario tax increase and suddenly it is justice for all. That is a double standard that exposes the hypocrisy of this government.

The Premier said back in November 1979 that further substantial price increases would constitute "not a cost we must assume to be secure, but a tremendous tax increase that would only benefit the governments of Canada and Alberta and of Saskatchewan as well." So he was saying: "It is not right to let those governments increase their taxes. Leave us the tax room, because once we get the majority we are going to go ahead and do it," as the government has now gone ahead and done.

The government of this province, adamantly opposed to a 30 per cent excise tax at the federal level, now imposes a 20 per cent excise tax at the provincial level. I ask you, Mr. Speaker, and I ask the member for Middlesex South, what the devil is so different between the Joe Clark increase --

Mr. Eaton: On a point of privilege, Mr. Speaker: I just want to inform the member that the riding is Middlesex. I know he never came near it in the election, because he did not have a chance in there. He did not even help his candidate. But it is Middlesex, not Middlesex South.

Mr. Cassidy: The member for Middlesex wants the House to recognize that he was finally here for a debate when the opposition was speaking --

Mr. Laughren: It is the only speech we have ever heard him make.

Mr. Cassidy: That is right. Since the member for Middlesex has now risen, I want to challenge him to get on his feet after this and say what the impact of this tax increase is going to be on the farmers in the great riding of Middlesex and to explain why it is that the Treasurer could have got on his feet -- I remember the day; as a matter of fact, I gave a speech on industrial strategy in the great riding of Middlesex round about November --

Mr. Speaker: Mr. Cassidy, could we keep to the bill and not the travelogue?

Mr. Cassidy: I am being provoked, Mr. Speaker.

Mr. Speaker: Just ignore it.

Mr. Cassidy: It was around November 1977, Mr. Speaker --

Mr. Speaker: Talk about the bill in 1981.

Mr. Cassidy: I spoke to a meeting in St. Jacobs in the member's riding, and I spoke specifically --

Mr. Eaton: St. Jacobs is not in Middlesex.

Mr. Cassidy: Is that not in Middlesex?

Mr. Eaton: He does not even know where it is.

Mr. Speaker: Order. Continue with the bill, Mr. Cassidy.

Mr. Cassidy: The member for Middlesex should explain why it is that his Treasurer in December 1979 got up in this House and talked hour after hour. It was a statement on motions, as I recall, as to the impact of the Joe Clark budget on the people of Ontario. He warned of serious economic problems from the 18-cent tax increase on gasoline, the tax increase that he now intends to impose.

The Treasurer said in 1979: "We have strongly opposed and continue to oppose price increases which go beyond the current federal-provincial agreement." That is exactly what he has imposed right now.

The Treasurer said about 18 months ago that there had to be massive reinvestment of energy tax revenues to ensure that the economy of the country did not receive a mortal wound from the 18-cent tax. Will the Minister of Revenue get up and explain how it is that the Joe Clark tax would have imposed a mortal wound on the economy of this province but the tax imposed by the Treasurer will not do the same thing?

The Treasurer warned of higher levels of inflation, but that was a year and a half ago and somehow things have changed today. He warned of a drop in consumer and business incomes, but that was a year and a half ago and somehow he does not expect the same thing to happen today.

He warned that we would not get energy conservation from the increase, but somehow it is going to work differently today. He warned of the fact that there was need for offsetting programs to cushion people on low incomes, but he has not proposed anything like that in the budget whose gas tax provision we are debating today.

The Treasurer said some provinces are more equal than others. Now he is turning around and saying, "Yes, Ontario is more equal than the rest, and that is why we are going to have an ad valorem tax and become part of the mechanism of taking money out of people's pockets."

He said the federal government was proposing to ease its budget deficit with the revenues it would get from the 18-cent excise tax, an ad valorem tax -- I see the Treasurer has come in; perhaps he will recall the words I will quote to him.

On December 13, 1979, the Treasurer expressed his undying opposition to the 18-cent increase in taxation on gasoline and fuel oil. He said, among other things: "It is a tradition of the taxation that was established by the federal government that it should be used to subsidize the higher cost of imported oil used in eastern Canada." That was the 10-cent tax originally introduced by John Turner.

The Treasurer said then that the purpose of the federal excise tax had been lost, because the federal government was proposing to ease its budget deficit with the revenues from the Joe Clark-John Crosbie excise tax. Yet that is precisely what the Treasurer intends to do with the increase in the gasoline tax we are debating today.

How come it was wrong for Mr. Crosbie to try to reduce the federal deficit, which the Treasurer has lectured everybody on so frequently, by means of the excise tax on gasoline, but somehow it is okay for the Treasurer to seek to reduce his provincial deficit by means of an identical tax in an amount that over three years will be identical to the tax that Joe Clark and John Crosbie were trying to impose? I have to say, I cannot understand it.

Then, back in December 1979, the Treasurer said: "I am greatly dismayed that the federal government would levy a tax on fuels used in public transit." He was so dismayed in 1979 that when it came to his budget a month or so ago in the Legislature of Ontario he imposed an increase in gasoline tax which, believe it or not, will be levied on public transit in Ontario. Those elements of public transit that do not depend on gasoline will be hit by the increase resulting from the change to an ad valorem basis for the diesel fuel tax in Ontario.

Why was it wrong for John Crosbie to tax public transit but it is right for this Treasurer to tax public transit? Why is it, as well, that we have not seen any offsetting measures at least to encourage people to move to public transit, if that is the judgement of the government?

In December 1980, with the connivance of the Minister of Transportation and Communications (Mr. Snow) -- there was consultation, and everybody knows it -- Paul Godfrey, chairman of Metropolitan Toronto, got the Toronto Transit Commission board to sneak through an increase in its fares to one of the highest levels on this continent. It was done at a time when this Legislature was adjourned. It was done at a time when the Legislature was not even slated to meet again. And that was called keeping the promise.

5:30 p.m.

In my city, to add insult to injury, not only was there an increase in transit fares at that time, but at the end of January the OC Transpo board, over the opposition of the representatives of the city of Ottawa -- who represent three quarters of the riders on the system but who have been given less than half the representation on the OC Transpo board thanks to the kind of regional government we have had from this government -- sneaked through not one but two increases in the basic fares for transit riders in Ottawa.

So did the government keep the promise? Did they wade in to try to protect transit riders, saying, "We know we are going to raise the tax on gasoline; the least we can do is keep transit fares affordable"? Did they help? They did not lift a finger.

When we challenged them, they said: "That is a decision made by an autonomous transportation commission. We are awfully sorry, but we are not prepared to provide any leadership to make sure public transit is not just the finest in the country and on the continent but also maintained at a level that is affordable."

From that precedent I know very well that, now there is a majority here, this government intends year by year to stand aside. It is going to soak people by making them pay extra for gasoline and diesel fuel, and it is going to allow the transit systems to push the fare up.

I suspect that by the end of this term, by 1985, we will find people will be paying as much as $1 a ride on a subway or a bus -- where subways or buses are available. But if they turn to driving their car, they will find they are paying much more extra cost because of the actions of the Alberta government, the federal government and their one-time, erstwhile long-time opponents, the Ontario government.

That kind of flip-flop is very hard for me to accept. The government has a tax that is going to take at least an additional $100 per family between now and 1983, and it couples that with a budget that is regressive and inequitable. It links that as well with an energy policy that has repeatedly missed the mark in terms of encouraging conservation, encouraging a better use of the oil, which we do not have in this province, and encouraging a more prudent use of a resource of which, like it or not, there are limited resources. When it does all this, I have to ask why the government even purports to say it has an energy policy.

I am glad to see there has been some imitation by the government of the Warm Up Ontario policy the New Democrats proposed during the course of the election campaign. It is a policy directed towards saving a massive amount of the imports into Ontario of crude oil from Alberta. That is a positive step, and it came only because of the pressure and the creativity of people in the New Democratic Party.

One might ask why it is such a half-baked program. Why is the government only prepared to go such a limited distance? Why have they not been prepared to spend money on conservation in the way they have been prepared to collect money, for example, from people who pay this gasoline tax?

The government was budgeting $16 million, I think it was, for renewable energy and conservation, and it did not even spend to the amount that was allowed in the budget. Yet here we have a province that was using 11 billion litres of gasoline every year, plus I do not know how many billion litres of diesel fuel, just for road transportation, for trucking and for passenger cars.

What kind of priority is that? What kind of priority is it when the Treasurer can collect an additional $100 million from the tax this year alone and will increase that by double over the course of the next two or three years, and yet he is not prepared to take any of those revenues and put them into providing means whereby people can be helped to save on the use of gasoline, diesel fuel and heating oil, which we have to use so much of in this cold climate?

Those contradictions disturbed me very much. What we really have is nothing but a grab for revenues by a Treasurer who is determined that in the first year of majority government, the government will take the revenues from any place they can be found.

It does not matter that it hits working people more than people who are rich or that many people on modest incomes have to drive 12,000, 15,000 or 18,000 miles a year, the same amount as people on high incomes. This is a tax increase that will hit working people, relative to their incomes, as hard as or harder than people in the upper-income brackets.

It does not matter to this government that people for whom automobiles or light trucks are a necessity are going to have to pay as heavily as people who use their cars to tootle off to Muskoka every weekend to enjoy their cottages. It does not matter to this government that the tax will be no greater for people who put gasoline into a big motor cruiser that putts around Lake Ontario getting a mile and a half a gallon than for somebody who has to drive a car many miles to and from work.

It does not matter to the government that people with high incomes often have a means of avoiding this tax directly and completely. They drive company cars; the company provides the car and the gasoline. In various ways that is written off as a business expense. The poor working stiff has to pay the full burden and more of this tax as he has to show up at work at 6:30 in the morning, driving his old, beat-up 1973 Chevy that only gets 13 miles to the gallon, unable to afford another one because of the cost of housing, food and everything else.

It does not bother this government. It does not bother the members opposite that they are now installing a tax that, without the authority of this Legislature, will see more revenues from the people of Ontario year after year without any further legislative authority.

Hon. Mr. Ashe: Have you told Premier Allan Blakeney of Saskatchewan that?

Mr. Cassidy: I am talking about what this government is doing here in Ontario. If this government did as good a job as Premier Blakeney in giving the people of Ontario a share of resource revenues then, by God, we would not have to increase this gasoline tax at all.

We have allowed the nickel to slip through our fingers. I have been asking questions about the cartel price of uranium, which is now costing us $50 million in excess every year. We would not have to increase this tax if we were getting that into the pockets of the people of Ontario. I have not heard the minister talk about that.

Out in Saskatchewan, the Blakeney government has a share in oil and gas development. This government had a share in Syncrude, and what did it do with it? It took a quickie profit and got out of the game entirely.

I understand a year or so ago the government thought it had some money and might put it into an oil company. Obviously that turned the stomachs of some of the true blue Conservatives. Maybe the Treasurer was among them. Was he among them? He opposed that acquisition, I understand.

Let it be put in the record that the response to that question by the Treasurer can only be described as sphinx-like and enigmatic, if not Delphic. The Treasurer will not indicate which stand he took.

In Saskatchewan, the people of the province have a stake and a share in the resources. In this province we have a minuscule share. What is it? We get 1.8 cents on the dollar in terms of tax revenues from our resources. This is where the Minister of Revenue might step in. We get 1.8 cents for every dollar of mineral production.

Mr. Speaker: Will you return to the bill please, Mr. Cassidy?

Mr. Cassidy: This is germane, Mr. Speaker, because if we had decent resource revenues as they do in Saskatchewan, which the Minister of Revenue introduced into this discussion, where they get about 18 cents on the dollar from resources taxation, we would not need this particular tax increase and we could deal fairly with people who have to drive their cars to work because no other transportation is available.

Hon. Mr. Ashe: Why does Premier Blakeney have it then? He does not need the money. It must be a windfall.

Mr. Cassidy: They have a fair tax system in that province.

Mr. Speaker: Order.

5:40 p.m.

Mr. Cassidy: Call the Minister of Revenue to order, Mr. Speaker. I ask the Minister of Revenue to explain how it is that a year and a half ago the Premier and the government were opposed to making windfall profits from increases in oil prices, and now what is the Minister of Revenue doing? He is the windfall con artist of them all. He and the Treasurer are sitting there with their golden pots taking the windfall, a few pennies, a few fractions of a penny on every litre every time the price is raised.

Hon. F. S. Miller: Is that plots or pots?

Mr. Cassidy: Pots.

Hon. F. S. Miller: It was pots, not plots.

Mr. Speaker: Continue, Mr. Cassidy. Never mind.

Mr. Cassidy: They have their begging bowls out, and they are taking a share every time the price goes up in Alberta and at the federal level. I say that is wrong. I say it is part of a budget that is wrong.

I say the Treasurer was wrong to sock it to ordinary people and leave corporations unscathed, and I say it is about time we had a government dedicated to closing up tax loopholes on corporations and to making Imperial Oil pay a tax rate as heavy as the tax rate paid by a machinist at Algoma Steel, as heavy as the tax paid by a farmer in Middlesex county or as heavy as the tax rate paid by a civil servant living on MacLaren Street in the great riding of Ottawa Centre.

If individuals in the province are having to pay marginal tax rates of 30, 40 and 50 per cent plus huge taxes on oil and gas and everything else, I cannot see why we should not tax corporations. When we have that kind of tax fairness, then let the government come back and argue whether an ad valorem tax makes any sense, but not before.

Mr. Elston: Mr. Speaker, I was very pleased to listen to the remarks of the leader of the third party and to be relieved of having to quote again many of the facts and figures that have come out. I have also been relieved of quoting from many of the speeches which I have also reviewed concerning the difficulties the government formerly had with respect to increasing taxes in many of the areas and paying extra costs.

Hon. Mr. Ashe: The same ones all over again. That's all right.

Mr. Elston: No. I have some specific problems with this bill, and they relate to my duties as a member elected from the riding of Huron-Bruce.

First of all, I want to make some general remarks about the bill in relation to Ontario. I think it is very clear that this gas tax has been calculated to add to the revenues of this province, but the people of the ministry have not shown an ability to calculate what it is going to do to the various segments of the industries of this province, notably some of the very important industries, especially tourism.

As the honourable members all know, tourism is a very important part of the economy of this province and requires a great deal of money to be spent on gasoline to travel from one centre to the other.

I might just remark at this point that my riding of Huron-Bruce has a very active and large seasonal tourist industry that requires the people to have access to the purchase of reasonably priced fuel in our area. If we deprive the people of my riding of the income coming to them during the summer season when it is very easy to have access to the beaches of Lake Huron and to the shores of Georgian Bay through my riding, those people will feel the pinch even more than the individual members of the industry in other segments of the province. I will get back to that a little later.

I want to mention that when we consider that this bill has an ad valorem tax instituted on the sale of gasoline in the province, it is a little difficult to take. It reminds me of the election campaign when I was running in Huron-Bruce and meeting the arguments of a worthy opponent who was running for the party opposite.

One of his major points was that, of course, there had not been a tax increase in the province for more than a year. He pointed out with great assurance that this was going to continue and that he was very proud to be supporting the government along those lines. He went on to point out several areas of difficulty he found in government policy. In the area of taxation he found it very easy to support his particular party in the position they held of not having raised the taxes.

I tried to point out to my honourable opponent that the government of the day was actually in the process of increasing taxes in the province on a day-to-day basis. I pointed out to him the retail sales tax which, as everyone knows, automatically increases --

Mr. Boudria: It is ad valorem.

Mr. Elston: That is very true. The member for Prescott-Russell points out it is also ad valorem.

In any event, it raises the revenues of the government every time an increase occurs in respect of the retail sales prices of all the commodities purchased by individuals in the province.

He did not seem to see that as a difficulty. But he probably would be very upset to see that this particular gas tax is also on an ad valorem basis. He, as a farmer, would probably be very concerned about it, as I am sure some of the newly elected members opposite from the farm ridings of this province are also very concerned about this sort of tax.

Mr. Wildman: Not one of them has spoken in this debate.

Mr. Elston: The fact that some of the honourable members sitting opposite who represent agricultural areas have not spoken probably reflects their confidence in the members of the agricultural ridings who sit on this side of the Speaker to put forward the case of the people of the agricultural ridings. I appreciate the confidence they are displaying in us at this particular time.

Mr. Boudria: We will have to speak twice as long.

Mr. Elston: We will certainly do our best to point out all the deficiencies to the government and to let it know we are looking after not only the agricultural interests of the people of our particular ridings but also the interests of the people of the ridings whose members are not able to put forward their particular concerns in public. It behooves all of us to look after the interests not only of our particular ridings but also of the province in general. We certainly will undertake to do that.

Getting back to the particular matter at hand, it seems to me that the gas tax has a terrible impact on several areas hit hardest in my particular riding. My riding of Huron-Bruce is located by the shores of Lake Huron, far removed from any areas of mass transit systems. It is also being increasingly abandoned by high-volume transportation, particularly rail facilities, bus services and things like those, which would give a competitive advantage not only to industry but also to tourism and to farming people.

Unfortunately, there is always a way to get into our riding, and several candidates find that way every election. Our airports are not always suitable for heavy landing of aircraft, but when Tories want to get into our area they certainly can.

Just let me speak for a few minutes on specific matters that do concern me and the people of my riding as a result of this particular gasoline tax.

I mentioned very briefly in passing before that Huron-Bruce is a prime area of tourist activity. We have several areas along the shores of Lake Huron that cater to the seasonal tourists and to the recreational needs of many of the people who live in the Metropolitan Toronto area and in areas like Kitchener and London.

We also have a large number of people who come to our area from the United States of America for a rest and to partake of the sunshine and the good weather of our particular area.

We certainly have many important individuals who own cottages in the Southampton area. Many of the people opposite will know of those particular people. I have to point out to members here in the House that the only way people can get into our part of the province with any degree of regularity is by car or private plane, if one happens to have one.

5:50 p.m.

Mr. McKessock: And the Tories have to be parachuted in.

Mr. Elston: Parachuting is also a method used.

In either case, when travelling in our area, one has to buy fuel. Every time the cost of fuel for operating cars is increased, whether it is gasoline or diesel, we are going to have to pay more to get there.

In fact, I read in the paper recently that several people have chosen to stay away from their cottages because it is now becoming an increasingly more expensive trip to make from this area. It is roughly a three-hour trip from this fair city to the shores of Lake Huron at Southampton. We can now appreciate how much fuel is expended every time that trip is made.

There are some people with larger cars who do not get the good mileage that some of us with smaller cars do. There are other people who like to tow recreational vehicles. When they take that into account, they are deterred from taking advantage of the tourist facilities in our area.

It is upsetting to me, because I know several motel owners in the area who have had very difficult winters in the past as a result of inclement weather. There was a downturn in visitors to our area because of lack of snow. Our snow load usually builds up in February and March. However, what they always hope for is that the summer will carry them through. In fact, some of our motel and hotel operators practically close down their businesses in the winter, anticipating the summer trade.

As I said earlier, there are reports that people are not travelling to cottage areas now as a result of this tax. I think it is unfortunate that we are depriving those business people of the incomes they have been accustomed to receiving in the summer. When we couple that with the problem those individuals are having with paying high interest costs and financing their businesses, we are not going to have a tourist industry in our area for very long under those circumstances.

That is one of the reasons I wanted to indicate that the gasoline tax in its current form is going to be very detrimental to the people in my area.

We know the tourist trade does not get good returns from people renting accommodations in motels or cottages. There are important spinoffs for people operating other recreational facilities. I am thinking now of the people who operate marinas to service pleasure craft -- water craft and land-based recreational vehicles.

When an industry is as important as the tourist industry is to our area, a development like this means there will be a very high level of unemployment. The tourist industry in the riding of Huron-Bruce sets up a vast number of jobs for students in the summer and takes in a fair number of seasonal employees from outside the riding.

If all these benefits to the economy are going to be thrown out the window for want of a few tax dollars, we should probably be looking at some sort of program that would give us the ability to help these unemployed people when the full impact of this gasoline tax is felt.

In my opening address to the Legislature, I outlined some of the characteristics of my riding that I felt were instrumental in making it a sound economic and social area in Ontario. In those remarks, as the members will recall, I set out that we have several very vital industries in our area, among which are foundries and factories that make doors for the building trade. We have other factories that make furniture for the consumer market in other areas.

But I must point out that these industries, located as they are away from areas that provide mass or large-volume transportation at reasonable prices, require the most inexpensive energy sources they can possibly get so that they can keep their competitive advantage over their rivals, who in many cases are located very close to major arteries of rail transport and other means of shipment.

I want to point out that in my home town of Wingham there are two factories producing doors. They largely export out of Ontario to the western province of Alberta, where they have found a very large market. But they have to compete against factories that are now opening up out in Alberta. The only way we can possibly keep competing with those people in Alberta is to make sure that our transportation costs are maintained at a normal level.

As the members will probably also understand, these factories -- one makes a steel door product and the other makes a wooden door for homes -- are unable to control the price of the raw product -- wood in the one case -- so they have to rely on every advantage they possibly can muster.

It seems to me that, when the factories I am speaking of have to bring their wood in bulk by rail in the form of cedar from British Columbia to Toronto and then have it transported via rail up to their plant in Wingham, every time we increase the cost of transportation by any means whatsoever -- whether it be for the trucks that have to go to the terminal to pick up the raw material, deliver it to the plant, pick up the finished product and then redeliver it to the area where the rail transportation can be found -- we are putting that whole factory in danger of losing its competitive advantage.

In a town of 3,000, my town of Wingham, we will throw 70 or 80 people out of employment in one particular plant. When you lose employment for 80 people in a town the size of Wingham you are really taking away a major portion of the earning power of the whole population of that centre.

The spiralling effect of the reduction of income and purchasing power not only has a very great impact on those particular workers but also ends up causing a great deal of difficulty for the merchants and the very people who make their living in that whole town.

That is why it is particularly critical to us in Huron-Bruce that every method of competing with those larger plants in centres where transportation is more plentiful should be kept intact. That is why I feel moved to express my displeasure with the fact not only that the tax is increasing the cost immediately but also, every time the federal government or the government of Alberta or whoever raises the price, that our people in these plants will have to make adjustments in budgets that have already been set.

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

The House recessed at 6 p.m.