ONTARIO GUARANTEED ANNUAL INCOME AMENDMENT ACT
ONTARIO PENSIONERS PROPERTY TAX ASSISTANCE AMENDMENT ACT
The House resumed at 8 p.m.
Hon. Mr. Ashe: Mr. Speaker, before starting I just wonder if we have now become a two-party Legislature. Oh, here we are.
Mr. Nixon: Here comes the spokesman for the Socialists.
The Deputy Speaker: It is my understanding that it would be appropriate for you to move second reading of the bill.
ONTARIO GUARANTEED ANNUAL INCOME AMENDMENT ACT
Hon. Mr. Ashe moved second reading of Bill 94, An Act to amend the Ontario Guaranteed Annual Income Act.
Hon. Mr. Ashe: Mr. Speaker, the main purpose of this bill to amend the Ontario Guaranteed Annual Income Act, 1974, is to fulfil the government's intention to limit the guaranteed annual income system benefits payable to individuals who are entitled to receive partial old age security pensions.
This amendment to correct an anomaly will prevent individuals entitled to receive partial Gains benefits from subsequently increasing their entitlement to receive additional Gains benefits. This amendment parallels similar treatment under the federal Old Age Security Act.
The change will adopt a federal rule that prevents individuals who are entitled to receive partial benefits based on minimum residence requirements from later increasing their entitlement because they have then lived in Canada long enough to receive more generous benefits. This bill will also change the appeals procedures by transferring the agency for objections and appeals from the Ministry of Community and Social Services to the Ministry of Revenue.
Although relatively few appeals have been received in the administration of the Gains program, this change will place the function of handling objections and appeals under this act in the same stream as similar functions under all other tax statutes. With this change the tax appeals branch, which was established in 1980 to handle the objections and appeals under the other tax statutes administered by the ministry, will also deal with objections and appeals filed under the Gains program.
In making this change, Mr. Speaker, a new procedure has been added that will enable senior citizens to object formally to assessments made by the Ministry of Revenue to recover overpayments of Gains benefits.
Mr. Haggerty: Mr. Speaker, I rise to support the amendments to the Ontario Guaranteed Annual Income Act, but when the minister introduced the bill I wish he had given the Legislature all the relevant details on other legislation for us to review.
I note he said it relates to federal government regulations on the number of years of residence in Canada. Right? That is what we are talking about: the new old age pension act. I am not quite sure, but I understand it may have some effect on residents in my area. I know a number of Americans have come to Canada, to Fort Erie in particular, and have tried to establish permanent residence in order to obtain old age benefits. I suppose it has hit other border towns in Ontario.
I do not know if they are entitled to Gains or not. Would they be in the proposed amendment to this bill, or would they have been entitled to it previously? Is the intent of it to close the loophole that permits nonresidents to come to Ontario to obtain Gains? These are the questions I would like --
The Deputy Speaker: The minister has indicated he will respond.
Mr. Haggerty: We support the bill in principle, but have a question about old age pensioners who are recipients of the provincial Gains program. There are other kinds of low-income persons in Ontario -- I am speaking of persons in that grey area. For example, there is the case where a spouse who is receiving an old age pension dies. If the surviving spouse is under the age of 65 he or she does not receive any benefits, to my knowledge, to assist after the loss of his or her spouse.
I suggest if the minister is considering further amendments perhaps Gains should apply to persons in this grey area who are permanently unemployable, who really need assistance to maintain their present standard of living and maintain their home after their spouses pass on. This is an area of concern to me and I am sure to other members of the Legislature. There seems to be nothing in this bill to give these persons some assistance so they can at least maintain a decent living. I hope that through your ministry, along with the Treasurer (Mr. F. S. Miller), you can find some means of financial support for these people who require some form of financial assistance due to the present circumstances of high inflationary costs, high energy costs and a number of other things such as the increase in food costs.
I know of a number of cases who are in dire need of some form of help and they are not getting it from the federal government, nor are they getting much from this government. This is an area I think should be looked at by members of the Legislature.
Mr. Charlton: We, too, will support this bill, but there are a number of concerns I would like to raise with the minister during the course of the debate.
We have no problem at all with the items in the bill dealing with objections. However, as a result of the federal legislation we find we have some problems with the item in the bill which deals with the limitation on Gains payments. We understand, as a result of the federal-provincial debate that has been going on over moneys, transfer payments and so on, the Treasurer and the Minister of Revenue in this province do not wish to be saddled with an additional burden as a result of a very chintzy, cheap and despicable approach on the part of the federal government.
On the other hand, when we talk about people who are eligible for Gains these are human beings who are senior citizens and who are at the very bottom of the economic stack. What this amendment does is to relegate some of those seniors to the very extreme lowest level in that stack for the rest of their lives.
The minister is aware that anybody who would be eligible for Gains in this province obviously has no other income from any source other than from the federal government. I understand the government's concern over this, but the federal legislation which this amendment is attempting to parallel and deal with is legislation which allows seniors who have lived in Canada for 10 years, but not 10 consecutive years, to take a reduced old-age pension.
The federal legislation relegates those seniors, if they apply for and accept that reduced old-age pension, to stay at that reduced level for the rest of their lives. Regardless of whether they eventually meet the residency requirements that others have to meet in order to receive the full old-age pension, they will never receive it. What this is doing is relegating those seniors to the same position in relation to Gains, which is the very bottom of the economic heap -- the extreme bottom, because we all know and we have debated in this House on very many occasions the whole question of income levels for seniors, especially income levels of seniors who are eligible for Gains. This is creating another step below that bottom line we have debated in this House a number of times.
8:10 p.m.
I understand the government's concern not to be put into a position of having to make up for inappropriate actions on the part of the federal government. On the other hand, I ask the minister to think quite seriously about this new low level of income we are creating for senior citizens, who are the least able to defend themselves against the economic forces in this society and the ravages of inflation. We are creating another low step, the lowest step we have in Ontario. That step is not acceptable in the context of what it will mean to the individual human beings who are being relegated to that position.
Senior citizens who find themselves in the position of having to apply for an early old age pension because they have not yet met the residency requirements are those most likely to find themselves in dire financial straits, not those who are rolling in bucks. Those senior citizens are being relegated permanently to that low level by the federal government, and this government is now prepared to go along with that in order to avoid picking up the responsibility the federal government is not prepared to pick up.
Colleagues in my caucus would certainly prefer to see the federal government pick up that responsibility, there is no question about that. I do not wish to criticize this government for the very cheap and degrading approach on the part of the federal government, but this is one case where all this talk we have had in Ontario about paralleling federal legislation is not necessarily appropriate. If the federal government has been wrong, as we have said so many times in the past to our sons and daughters, two wrongs do not make a right.
Hon. Mr. Ashe: I will cover briefly the points made by the member for Erie and the member for Hamilton Mountain. First, I would like to clarify why and how a person qualifies for Gains. This amendment is designed to clarify what we know is the intent and to tie in with federal legislation, but at the same time not to cut down our liability for Gains. That is not what we are trying to do.
Persons who are residents and have 10 years' Canadian residency qualify on the basis of ten fortieths of the old age security benefit. They would still qualify, potentially, for the full guaranteed income supplement and the maximum Gains payment from us, which at the moment is $48.88 a month for a single person. The way the present legislation can be read -- and I say "can be read" because we have never had a claim under it, we just want to make it clear we are not changing anything that is not already happening -- it might suggest that as a person qualifies for full benefits we would not only pay the $48.88 but would be obliged to pick up the other three quarters of the old age security the federal government does not pay because of its rules and regulations.
I do not think the Gains program, as paid for by Ontario taxpayers, was designed to do anything more than it is doing now. We are prepared to pay up to a certain limit for everyone but not to take over the obligations. We are not challenging the requirements of the federal act -- that is, the ten fortieths or twenty fortieths or whatever the case may be -- but to make it clear we will not be picking up any of the shortfall not paid under federal legislation. We are not creating or changing anything. We do not think that is our obligation.
The other thing to keep in mind is that a great majority -- I can appreciate it is not everybody -- of the people who do apply for partial old age supplement benefits are normally immigrants from other countries -- it does not matter from where -- who may already have pension benefits or partial pension benefits from that other country. It is a little unfair to suggest the majority or even a significant number of these people would only be relying on pension income derived from residency in Canada or Ontario. Normally it is to supplement income from elsewhere.
A question also brought up by the member for Erie was about another situation, of a surviving widow, for example, under the age of 65. I think he brought in disability. The Gains program per se, at least the Gains-A program, is designed for people beyond the age of 65. But there are other social programs within this province that in most instances would take care of the two situations described.
There are other benefits under the Family Benefits Act of this province through the Ministry of Community and Social Services that would provide for the widow under the age 65, even the physically able, who is not in the best financial circumstances. We have a Gains disability benefit as well for those who have a disability which puts them down at the lower end of the income scale.
There is no doubt one can always challenge the fact that these benefits should be higher. It is fair to say we try to cut the cloth to the amount we have in the bolt. The bolt, in this case, is the taxpayers of Ontario. We try to come up with something reasonable, responsible and more than competitive to recognize those situations in Ontario as good as or better than any other jurisdiction in this great country of ours.
Motion agreed to.
Ordered for third reading.
ONTARIO PENSIONERS PROPERTY TAX ASSISTANCE AMENDMENT ACT
Hon. Mr. Ashe moved second reading of Bill 137, An Act to amend the Ontario Pensioners Property Tax Assistance Act.
Hon. Mr. Ashe: Mr. Speaker, this bill to amend the Ontario Pensioners Property Tax Assistance Act will enable senior citizens to receive a temporary home heating grant for the next three years. This new grant is a part of the program announced by the Treasurer (Mr. F. S. Miller) on June 23, 1981, to provide temporary assistance for home heating costs. The temporary home heating grant is designed to cushion some of the impact of home heating cost increases that senior citizens are likely to experience over the next three years.
Persons 65 years of age or older who have incurred occupancy costs for their homes will automatically receive their temporary home heating grant in the spring of 1982, 1983 and 1984. The amounts of the grants will be $60 for 1981, $40 for 1982, and $20 for 1983.
Every effort has been made to simplify this grant program for senior citizens. They need not file applications for the new grant. If a senior citizen qualifies for the property tax grant, either as a home owner or as a tenant, he or she will receive the temporary home heating grant along with the interim payment of the property tax grant each spring until the spring of 1984.
The temporary home heating grant program will minimize the strain of higher heating costs on senior citizens. The program will be phased out gradually over three years. During that period, some 540,000 pensioner households will benefit from this program. It is estimated this new home heating grant program will cost $33 million for the upcoming home heating season, and $63 million over the next three years.
8:20 p.m.
Mr. Haggerty: Mr. Speaker, I was just trying to go through some notes I have here and listen to the minister's opening comments. I am afraid he does not show too much benevolence for this time of the year.
This is only a temporary program. In looking more closely at this, I would suggest he copied it, or stole it, from a Liberal program in the last Ontario election. We suggested it was time the government provided some tax assistance for the persons who are purchasing home heating gas or oil, and we suggested at that time the grant should be about $150 per household.
I am a bit shocked the minister would come in with a program as small as this is in generosity. It is only going to be good for three years. It is a grant of $60 for 1981; $40 for 1982; and $20 for 1983. The minister knows full well the cost of energy will increase an enormous amount by the years 1983 and 1984. I do not have to tell him that in the last agreement between the federal government and the oil producing provinces the federal Department of Energy, Mines and Resources has indicated that Ontario will generate $7.4 billion in revenue by the year 1984.
I was reading a statement here by the Treasurer in June, in which he said the net cash requirement of Treasury will only be $1 million higher than planned for in the budget due to the fact that revenues are up by $92 million from the budget plan. It is perhaps the increase in the ad valorem tax that has generated additional revenue for the minister and the government. I suggest the ad valorem tax is going to bring in huge amounts of money -- my guess would be a couple of million dollars in a year.
Hon. Mr. Ashe: No, more than that.
Mr. Haggerty: More than that? I wish we could get those facts correct, because I know it is difficult for our research to come forward with just how much revenue it will generate. But I know it is more than the Ministry of Revenue and perhaps the Treasury have indicated it would generate for Ontario.
So we are looking at huge sums of revenue, and they want to come in with a bill here today and ask us to support it, offering $60, $40, and $20. It is a disgrace to the pensioners in Ontario.
There are other persons in Ontario, property owners and persons renting, who are on low incomes and will not receive this benefit, such as it is. That is an area the minister should have taken into consideration, with the huge revenues he is going to get from this latest oil price increase and the ad valorem tax. He could have ventured into this area. If one is receiving general welfare, for example, he or she is going to have to wait almost a year before getting a rebate on the increase the allowance gives on welfare. It seems to be a bill that should be thrown back to the minister and brought in with amendments that would include these persons on lower incomes.
It is difficult right now for many home owners and persons on low incomes. Even the average wage earner in Ontario is going to have a difficult time meeting the high energy costs to heat his home.
I suggest the minister has not gone far enough in this area. The most important area -- one which I can agree on -- is the example that it is going to be included, as the minister has indicated in his press release. He said the bill to amend the income tax act will enact the temporary home heating credit. This credit is intended to reduce the impact of home heating costs for other low- and fixed-income Ontarians. This document is from the minister and it says "other low- and fixed-income," but he does not include that in the bill. I suggest that is misleading. He has misled the people of Ontario by indicating that other persons besides pensioners would receive some assistance.
Hon. Mr. Ashe: They will.
Mr. Haggerty: They will? It is not in this bill.
The Deputy Speaker: Far be it from me to get sticky, but is the member suggesting the minister is misleading this House?
Mr. Haggerty: In this statement he is, inadvertently. He says, "Individuals who rent their homes will be able to claim their temporary home heating credit by filling out the Ontario tax credit form in their income tax returns."
Hon. Mr. Ashe: That is in Bill 138, the fourth bill tonight.
Mr. Haggerty: There is a point where I said I could agree with him. I think this is an example of the ministry, and perhaps the government, having found they have made a botch of the Ontario tax credit grant for seniors. We know the purpose of that grant was to buy votes in the last provincial election. They were going to give two grants, one in the spring and one in the fall, but they were not quite sure when the election was going to be called. The Ontario tax grants previous to that were done in a manner that suggested, as this bill does, it would be done through the income tax. There were no problems with that when it was done through the income tax. Every pensioner, every person, understood it and they had no difficulties in receiving the grants.
The minister has come forward on a number of occasions with letters and announcements in papers. I do not know what the cost of them is, or of the phone they have, on which no one can reach them. What the cost is to the taxpayers I do not know, but I imagine it is considerable. I commend the minister for this bill under the Income Tax Act. It will reduce the difficulties pensioners are having today. It is almost six months since the grants went out in the spring. In fact there were very few problems in the spring when the grants first went out around election time, but somewhere along the line he has run into difficulties. I understand he has an advisory committee within his ministry now, trying to resolve the problem. It cannot find out where it is.
I do not know how the minister or his staff have bungled a system they had working very well previously, before the election was called. I suggest it is the incompetence of the minister. He should resign because of the hardships he has caused persons looking for that grant. They may get it before Christmas. I hope he comes out with a red suit and a white beard to see that the cheques go to those people. One of the reasons the opposition members are here is to make sure the minister keeps his promise. There are many areas of election promises he is neglecting, and this is one of them.
He has not made a strong commitment that those people who are waiting for their cheques should have them by now. There is no reason for that. I support the minister in this bill because grants are going to come under income tax. People will know full well that once their income tax form is filed there will be a cheque for them in a matter of six weeks, not six months, 11 months or the following year. That is what the minister should be looking at in changing the other property tax grant for seniors. That should be changed now so that when they make out their income tax this coming year they will have their cheques at least by June, in enough time for them to pay their instalments on their taxes.
I suggest to the minister this program was taken from the Liberal policy platform in the last provincial election. We supported it on principle and I suppose we have to support it now, but it does not go far enough.
8:30 p.m.
Surely the amount of money they are going to collect from this ad valorem tax would enable them to do more. What are they going to do after 1983, when they know the price is going to go up again? There is a program up to 1985 with the oil producing provinces. That means it will probably increase by almost 40 per cent or 50 per cent the following year, which is going to have a terrific impact on all persons consuming home heating energy, whether it be electricity, gas or oil.
I suggest that if they can find $650 million to purchase Suncor, surely they could have found more here to provide at least up to $150 a year assistance to any person purchasing oil or natural gas to heat his home. If they can find it in one area surely they can find it in another, because they have really taxed them far enough in this area in relation to energy costs.
I suggest that the federal government has jumped on the bandwagon to hit the property taxpayers with such a high increase in the cost of home heating oil and natural gas. Some place along the line they should be working with the federal government. Those fellows over there are in bed with the federal government and they should get them to hand some of these transitional grants back and pass it on through.
They seem to forget what the main purpose of these grants should be; they should go back to the person who pays the tax in the first place. It would be great for them to say, "We can tax you," and then all of a sudden come back and say, "I am sorry, we have overtaxed you in this area. We will give you a little bit back." They have taken too much from the beginning.
There is a signal being given out on the streets right now in Ontario. It is going to be getting more noticeable and people are going to be more concerned about it. I suppose they can look at what happened with Proposition 13 in the state of California. People are going to say, "We have had enough of this taxation and the waste that is caused by the government's spending in areas that are not set by priorities."
We support the bill in principle, as small as it is in providing assistance for people in the greatest need.
Mr. Charlton: The members of this caucus very much recognize the efforts of the member for Erie to carry on the tradition of our former colleague for Scarborough-Ellesmere in calling for the resignation of the minister, but the member for Erie is not likely ever to be able to fill those shoes.
Mr. Haggerty: He was an overnight case.
Mr. Samis: That is the volume and the verve that Dave had.
Mr. Nixon: We need him back. The New Democratic Party has not been the same since.
Mr. Charlton: I too rise in support of Bill 137, but I would like to make a couple of comments on the bill, and perhaps make even a couple of suggestions to the minister.
As I suggested on the last bill, I understand the problems the province has in trying to deal adequately with the numbers of dollars that are involved in the home heating sector as a result of what has happened to energy prices in general over the last few years. However, in this context I have some problems with the specific dollars that are laid out.
The minister used the phrase "minimize the impact" or something to that effect. Certainly the grants in this bill will reduce the impact because any single dollar thrown into a senior's pocket to assist with his home heating cost will reduce it. But I certainly do not see a $60 reduction this year and a $40 reduction next year and a $20 reduction in the third year as significantly minimizing the impact of the high cost of home heating fuel on senior citizens in this province. From what Statistics Canada tells us, they have been living below the poverty level for a number of years now.
Again, I cannot totally fault the government of this province for what has happened in the energy field, because we all know the debate has been very much with the federal government and transprovincial in nature.
I understand the dollars and cents problem the government has, but I want to make one suggestion to the minister which on an individual basis in any given year might provide substantially more assistance to the seniors of this province, or at least to some of the seniors, on a longer-term and ongoing basis.
If the government of this province were to take the moneys that will be demanded of them by this home heating assistance program and get involved in an add-on to the federal program for conversion, it might be able to assist some seniors in this province.
I should point out that those seniors who are being hardest hit by home heating costs, those who still happen to have oil furnaces in their houses -- because those seniors paying heating costs based on oil are the ones who are being hit the hardest -- find themselves in a situation where, even with the federal grant to pay up to half the cost of a conversion to natural gas or a maximum of $800, whichever happens to come first, they are often unable to come up with the additional $800 or $500, or whatever it happens to be, even to qualify for the federal assistance for half the cost of the new furnace.
Although they own their homes, having paid them off, and are getting the old-age pension, the guaranteed income supplement and the guaranteed annual income system payment from this province, they often are getting nothing else because, unfortunately, they did not have any pension at the places they worked for their lifetimes.
Some may have small amounts of savings, but many have nothing. It is our perspective that the money this government is using for this across-the-board declining grant, which will run out in three years and which will mean little if anything in two years, perhaps could have been much better used to assist those in the seniors' group who are hardest hit by heating costs by using it as an add-on to the conversion program.
Right now, natural gas costs in Ontario are running 20 per cent or more below the cost of oil. If that is not a permanent saving for any senior who can afford to convert, it is at least going to be a longer-term saving than the three-year declining process that is set out in this bill. That is just a suggestion to the minister put from a positive perspective.
We are supporting the bill, because we are glad to vote in favour of any assistance we can get for the seniors of this province, although sometimes we would like to see assistance that we think is a little more appropriate to the dire problems our seniors have.
Mr. Newman: Mr. Speaker, I want to make a few comments to the minister concerning Bill 137, An Act to amend the Ontario Pensioners Property Tax Assistance Act, and to make a suggestion to him, hoping he will accept it, if not in this year, in some future year.
The bill is a step in the right direction. Unfortunately, as the minister has the amounts indicated here, in each succeeding year we are going to find the cost of energy is going to increase substantially, whereas the grant given to the senior citizen is substantially reduced. It is reduced first by 33.3 per cent, and the next year it is reduced by 50 per cent, yet the costs for the energy itself are going to increase substantially. We hope not, but we know if we face the facts of life that they will be increasing.
8:40 p.m.
One of the areas I am concerned about is that a lot of our seniors, as well as others but I will refer to senior citizens only, do live in government geared-to-income housing, senior citizens complexes or private dwellings. The cost of energy is included in the rental. The individual may be paying X dollars, which includes heat. Is that individual going to qualify for the grant for heating assistance? Is it going to include him since he lives in an apartment or unit where the rent includes the energy component?
Mr. Samis: Mr. Speaker, I want to speak briefly on this bill. Naturally, we support the principle of assisting seniors. I would point out, like my colleague the member for Erie, that I am not sure the seniors are the people most affected by the rising costs of energy when one compares their predicament with people on welfare and under the Family Benefits Act. I somehow suspect many of them are in far worse straits. I realize there is a jurisdictional problem, but I still think those people probably have a greater need in more cases than our seniors.
But dealing with the case of seniors, I have two basic questions that I want to pose to the minister. First, why is the program temporary in nature? What sense does it make bringing in a program with a built-in program for self-destruction, and why the declining value when we have increased energy costs?
If the minister refers to the limitations on the budget and says the government can only spend so much, it has already been pointed out that the ad valorem tax will bring in added revenue every year for the next five years as part of the federal-Alberta energy agreement. That will go beyond those five years when they sign a new agreement in 1985-86.
Second, three weeks ago the government was able to find $650 million to invest in Suncor. The government had no problem doing that and paying a hefty rate of interest. The minister probably was one of the 22 who was not even consulted on the whole deal, which is an insult to the minister and every member of the cabinet who was not consulted.
Just last week, the Treasurer announced $20 million for the car dealers of Ontario to help them out. There was no trouble getting that money. That is such a ridiculous program, where one can have the absurd case of somebody buying a car made in Russia and getting a rebate from this government to the tune of $300, $400 or $500, and yet we are telling seniors that $60 is all they can expect from a program like this.
I ask the minister, in the context of the fact that fuel costs in this province probably will increase more than 100 per cent in the next five years as part of the federal-Alberta energy agreement, why introduce a program that is going down from $60 to $40, from $40 to $20, and then down to zero in its final year? What sense does that make to consumers when the cost of home heating will be going up?
I think the suggestion made by my colleague the member for Hamilton Mountain makes sense. If we are trying, as an overall policy, to reduce this province's dependence on oil and imports from Alberta, it would make far more sense to assist our seniors to take advantage of the federal energy conservation and conversion programs. That would reduce the cost for seniors and probably would reduce the need for this government to assist them if we could cut down their fuel costs that way.
In summary, it seems to me that this program is illogical and inconsistent in the idea of its built-in self-destruction. I ask the minister to look into his crystal ball and use his powers of clairvoyance to tell us what goody he is concocting for the election year of 1985 to replace this program as it self-destructs.
Mr. McKessock: Mr. Speaker, I rise to support what the minister is doing but not the way he is doing it.
The minister said in the previous bill that the government was obligated to pay seniors up to a certain level, but he did not want to pick up any unnecessary payments. This being the minister's philosophy, why is he picking up and making payments to property owners who are millionaires, as well as to those who need it, as is being done in the property tax rebate program? In this home heating program, he is doing the same thing, contradicting himself.
One time he says he does not want to pay any more than he has to, then he comes out with a program that makes payments to everyone: first, the property tax rebate, and second, the home heating program, which is going to cost another $63 million right across the board.
Why not add these benefits to the guaranteed annual income system cheques that are already being administered? Then those who need it will get it and those who do not need it will not get these piddling cheques of $60, $40 and $20.
The minister probably will say that he will tax it back from the rich. These cheques he has been giving out to those who do not need it and do not want it all cost money in administration. The property tax rebate alone was to cost $3 million in administration, and I am sure it probably will be double that by the time it is figured out, with all the problems they have been having with that program.
He will add more to administration by coming out with these new programs. We do not need another program. The Gains program is in place. That is what it is for: to assist those in need. Why does he not increase the monthly payments on Gains cheques and forget about sending out these piddling cheques to everyone? I think it must be a make-work program for the civil service. Why does he not give a paid holiday to the people who are coming up with these new programs? It would be much cheaper. Tell them that a program called Gains is already in place, and it would serve seniors adequately if he were to fund it accordingly.
Ms. Bryden: Mr. Speaker, I support this grant to help seniors with their heating costs, of course, but in supporting it I feel that I am offering them a peanut, because it is a minimal grant which will not even raise them up to the poverty line -- and most of them are below it.
This grant is a disappearing grant, and there is no promise from the minister that he will see that their guaranteed annual income system payment is increased next year and the year after so they can absorb their heating costs any more easily than they will be able to in the coming year.
It is a grant that comes at the end of the heating season. I do not know how they are supposed to finance their heating costs in the meantime; perhaps they are supposed to keep their thermostats down to 55.
In other words, I feel this grant is an insult to our seniors and does not really solve their problems. It is the sort of highly visible grant that the government likes to send out in separate envelopes with separate postage on each envelope at 30 cents plus next year. It costs a great deal to administer and it costs a great deal in postage, and I doubt if they are even considering combining this mailing with the mailing of the pensioners' tax grant or the retail sales tax grant. It would make sense if they did combine those mailings, particularly in view of their alleged desire for budgetary restraint. But it appears that when it comes to handing out little dribs and drabs of cheques to a large number of people they prefer to do it in individual envelopes, individual mailings and individual postage.
While I support the idea of an energy relief grant for seniors, I would like to see it done in a more sensible way through a tax credit system. Through a tax credit system it would also be possible to ensure that it does not go to the rich as well as to the poor and, therefore, that there would be more funds to go to those many thousands of seniors who are below the poverty line.
I also hope that the Ministry of Energy will do more to reduce heating costs for seniors and for all Ontario citizens by developing alternative and cheaper sources of energy, but they are putting minimal amounts into research in these fields.
The other thing that concerns me is whether this grant will turn out to be the same kind of disaster area in administration that the pensioners' tax grant and other handouts of the Ministry of Revenue have been, such as the late, lamented home buyers' grant. In that program, a great many people received grants who were not entitled to them and now attempts must be made to collect them back.
8:50 p.m.
The same thing has happened with the pensioners' tax grant. My constituency office reports getting calls every day about the pensioners' tax grant administration. Now, when people phone in, the details are not taken; their number is simply taken and they are told somebody will return their call to deal with their complaint. Often the call does not seem to be returned. It may be they are not in at the moment the call comes, but they feel they have not even had an opportunity to get the details across to the ministry as to why they are not getting their grant.
There are all sorts of cases where grants have gone to people not entitled to them. This may happen with this grant as well. Grants have also gone to deceased persons. The accident-prone record of the ministry in administering these handouts is something that concerns me greatly; they should be discouraged from carrying on this kind of assistance to seniors. I think the seniors would benefit much more if the money that is wasted on these handout programs were concentrated and went to those who need it through a proper tax credit system. If the seniors need assistance in making out their tax forms to collect the grants, that could be arranged through government information offices.
I will not go into all the cases I have of people who have had difficulties getting their pensioners' tax grants, but I will say they are numerous. While the ministry does attempt to deal with our complaints as they come in, a great many seniors out there feel that although they put their application in for the pensioners' grant in September, somebody else got their money in November but they have not received theirs yet. They feel there is discrimination or else that it has been lost and they get very worried.
I hope the minister will clean up his act administratively so that when this grant does go through -- and I understand it does not go out until next spring -- it will go to those who are entitled to it under the legislation. I hope there will not be all this hassle of people finding out that somebody has received their grant ahead of them and they have not heard anything from the ministry as to why they have not received it.
I regret that all these hassles cost a great deal in taxpayers' dollars for the administrative machinery to handle the complaints. If we did not have this system, we would be saving a lot of money in administrative machinery. I hope the next effort of the ministry to assist seniors will be a better-designed system that will get the money to those who really need it.
Mr. Nixon: Mr. Speaker, I have a high regard personally for the Minister of Revenue. I have seen him in action on a number of committees and have known him personally in this House for some years. I feel quite disappointed that, even though he is now the Minister of Revenue, we still have a continuation of the policies I would have thought a hard-headed, impersonal, tough-minded, independent-thinking member of this Legislature would have been able to change. These programs reflect the kind of cockeyed, top-of-the-head decisions made by the Treasurer far more than those of the Minister of Revenue.
Over the last number of years, I have always regretted that the government of Ontario, for reasons that have never made sense to me, decided to have a separate Ministry of Revenue. I feel it is entirely a waste of money to have a separate Minister of Revenue, because he does not do anything but administer the decisions made by the Treasurer.
Mr. Haggerty: He should resign.
Mr. Nixon: My colleague has said it. If our good friend, the present minister, had the tough-minded independence we have always given him credit for, he would resign his place forthwith and move to the back there to wait for his turn to be Treasurer. I would sooner see him in that job than the incumbent, because those policies recently put out by the present Treasurer are absolutely hare-brained. They do not show any of the great strengths of carefully thought out, tough-minded policies designed to meet the needs of Ontario at minimum cost to the taxpayers.
They do just the opposite. They are the sort of things that might occur to the Treasurer when he is out jogging or washing his yellow Corvette, or whatever has taken its place. He probably does not need one now that the taxpayers are providing him with a new --
Mr. Epp: It is a foreign one.
Mr. Nixon: Has he a foreign car? I do not know about that. I do not want to get too far afield.
I cannot help but feel that the minister, when he goes home at night and is lying in bed, must thrash around thinking about the terrible policies he has to administer. It would a little different if he were a paid civil servant. The minister, the Treasurer, would simply say, "Do this," and the civil servant might very well say, "But, Minister, it should be done this way and that way." Perhaps the minister, if he were the Treasurer, would simply say, "Be quiet and do what you are told," or whatever one would say to senior civil servants.
I have not had that experience. The minister should not be treated as a senior civil servant or even as a junior one. He is certainly being treated as one who has no mind of his own.
Knowing the minister, I cannot believe that in his heart he supports these inane, asinine programs, which is what they are. To be passing an amendment that means he has to crank up the computers to send out all the cheques for all the little old ladies with the quill pens who are in his ministry to pass along seems to be an entirely serious waste of money.
I like the suggestion made by the member for Grey when he said we believe these people should have assistance with paying their heating bills, and to just add it to the Gains. The people who need help will get it.
An older lady, such as my mother, who is leaving for Florida in a week, undoubtedly will get her heating subsidy in the mail; if she does not, she will phone me up and wonder why. She has the right to it, as does Harold Ballard and all these senior citizens who should be paying taxes and are glad to do so. They love to get letters signed by the Premier (Mr. Davis) or the Treasurer or whoever signs these blooming cheques. Do they all have a picture of the Legislative Building in the background, just so there is no mistake? They say, "They do not come from Ottawa, friends; they come from your friendly Tory government," which has more money than brains. It has more money than brains; that is a fact.
I hear my mother's euchre and bridge friends. They are saying: "Did you get your $50? I got my $50. I got my $250. I am supposed to get another $250. Has yours come yet, Alice? No, mine has not come yet, Lois. Well, you had better phone Bob and see what's holding it up."
I am sick to death of it. None of these ladies needs the money. They appreciate it because it means they can buy Christmas things for their grandchildren and their great-grandchildren. They really like to have it. It is true they have worked hard and paid taxes for a long time, but it is a very bad way to run the Treasurer's program.
I want the money to go to the senior citizens who need help to pay their heating bills, but why should those cheques be sent down to Florida? That is wacko. It is a waste of money and a very --
Mr. McLean: That's what you thought, Bob.
Mr. Nixon: They are not sent down; they have them deposited to their accounts back home because the interest rates are better here. It is appalling that we have taken this course of action.
9 p.m.
The Minister of Revenue never complains about the government of Canada, but the Treasurer does. Suppose the government of Canada, or Mr. MacEachen, followed the example of the Treasurer of Ontario and the policies of the government of Ontario. We do not know what he is going to do on Thursday, but no doubt the Minister of Finance for Canada will announce his programs, such as wrestling inflation to the ground and those things we have been waiting for. But just suppose he follows the example of the Treasurer of Ontario.
The federal government would stop the grants to Ontario for post-secondary education and send a cheque with the Peace Tower in the background, signed by Mr. MacEachen and Mr. Trudeau, for half the cost of education for each kid, beginning in grade 13 and beyond that. Why not? After all, who gives them credit? The members opposite certainly do not. They never give the federal government credit, and that is one of the latter's objections. It pumps into Ontario more than 40 per cent of our budget, and all the people opposite do is give it a hard time, except when it is to the political benefit of the Premier, in which case, as somebody mentioned earlier in this excellent debate, they crawl into bed together and exchange cheques. It is hard to decide who is the payer and who is the payee. I could put different nouns to that combination.
Mr. MacEachen really ought to be sending out his direct welfare payments. The federal government pays a very large percentage of the cost of social and family benefit programs. Why should the payments all come out from the Minister of Community and Social Services (Mr. Drea)? Everybody thinks that good, generous minister has come in from the track for an afternoon and sent out a bunch of these cheques. The federal government also pays a very large percentage of our Ontario hospital insurance plan costs. It is supposed to be just 50 per cent but, because this government has redirected -- I will not use another word -- much of the funds made available by the government of Canada --
Hon. Mr. Ashe: That is not true.
Mr. Nixon: It is true. Monique Bégin was right on when she complained about the misdirection of federal funds coming into Ontario. This government just puts them to use for general purposes. It uses them to buy jet planes. It uses them to make down payments on oil companies, instead of spending them on OHIP programs where they should be spent.
I ask you, Mr. Speaker, would it not be reasonable if Mr. MacEachen advised his colleagues to send cheques directly out to the people using doctors' services or to hospitals and to say, "Here is assistance coming from your friendly government of Canada to meet your medical requirements"? After all, they do not get any credit from these people over here. For the last five or six years, ever since the Premier has gained a little confidence and come into his own around here, ever since he got rid of Darcy McKeough, he has really decided that every one of these dollars should buy votes.
I have the impression that his chief fiscal and financial adviser is not the Treasurer or the Minister of Revenue, but the Minister of Agriculture and Food (Mr. Henderson), who found out in Lambton county how to use these programs when he delivered the cheques by hand.
I get cheques myself, I must tell you, Mr. Speaker, because we have a program here where the government of Ontario, recognizing its responsibility to farmers, has paid half the cost of our land taxes. As somebody pointed out, I think it was the member for Beaches-Woodbine, with each of the cheques -- and I think I get about five of them for my extensive holdings, my extensive patrimony in South Dumfries township -- for every little piece or half part lot I have, I get a separate letter, with the information that it comes from the government of Ontario and from the Treasurer and all the rest. It is fully stamped and I have to take it to the bank; it has all the requirements for that purpose.
Even with that grant, I pay far more taxes than I should. Any farmer in this House will tell members I am right. Ask the member for Stormont, Dundas and Glengarry (Mr. Villeneuve). He and I always agree about these matters.
I believe it is such a waste that we even have a Minister of Revenue, because I repeat that I know the abilities of this Minister of Revenue and, if he had his way, I am sure he would kick these programs out in one fell swoop.
If this ministry lasts another year or two -- which is questionable, but it may -- we hope he gets out of this third-rate ministry, which should not even be a separate ministry at all. We hope he has a chance to prove his mettle in something worthy of his talents like the Ministry of Correctional Services. I really regret it.
I also want to join those who have said that, with the difficulty we have in getting anywhere near balancing our revenues with our programs in this province under the direction of the present Treasurer, we should be using our funds to assist those who need help and stop sending this money to Florida or Maple Leaf Gardens. That is absolutely preposterous. It would be quite simple to give the money to those who need it rather than simply give it across the board to all concerned.
I also believe the intent, which is basic cornerstone Tory government policy, of being sure political credit is magnified for every buck it sends out is not worthy of any modern government. One does not see those people up in Ottawa doing that.
They use their dollars for the good of the taxpayers. They do not have wasteful programs of the type we have to put up with in this province. As I have indicated, if on Thursday Mr. MacEachen were to follow the example of the government of Ontario there would be far-reaching changes which would decrease the efficiency and usefulness of these federal programs.
However, I will be supporting the legislation.
Mr. Boudria: Mr. Speaker, it is difficult speaking after the illustrious House leader because he has almost said it all. I will be brief in making some comments to express my bitter disappointment in this legislation.
It is unusual to see a government that can spend $650 million to buy Suncor and $10.6 million to buy a jet only give $125 million over three years to a program like this. Even at that it is not even well-administered. In many cases it is not going to areas where it should. As the member for Brant-Oxford-Norfolk has indicated, the money will be going in many cases to people in this province who should not be receiving it. I see right across from me the member for Stormont, Dundas and Glengarry who will himself be receiving one of these cheques. Probably other members of this House will be receiving those cheques.
The purpose behind this is not to give cheques to assist in paying the oil heating bills of such members as the member for Stormont, Dundas and Glengarry. I would hope instead we would be helping people who really need it -- people who are in dire straits, not people who can afford to do without it.
My House leader has indicated some of these cheques will be cashed by people who are not even living here in winter and have gone to Florida. That is a disgrace. Why did the government not see fit to do as the member for Grey has suggested and implement that program along with the Gains program where the people who need it would get the money and the people who do not would not get it.
It is funny to see the priorities of this government. It is not really funny, it is sad that this government would spend the money it is spending on absolutely useless programs such as this. This is so heavy in administration and gives so few benefits to the people. There was the other idea this brilliant government had of buying that jet. Why is that $10.6 million not going to help people who are in need?
I see the Minister of Government Services (Mr. Wiseman) sitting in the House with us tonight. I thought it would be appropriate at this time if I read to the members -- and of course I hope the minister will be listening -- this interesting article I saw in the newspaper today. This article is from Monrovia, which is the capital of the very important country of Liberia. The president of that country has ordered the government to sell the only jet in that country.
9:10 p.m.
I hope the Minister of Government Services, whose ministry is in charge of disposing of the useless equipment the government has, will take a similar initiative to sell the jet we have in this province and put that money into programs of greater value. Anything would be of greater value than that venture.
I guess it was the member for Beaches-Woodbine who described the very inefficient way in which other programs of that same ministry were administered. The constituency office assistants should get a raise for all the work they did in helping to administer that program alone. Half the calls they got in the last month were about programs administered by the Ministry of Revenue: things like three, four or five cheques made out to the same person while the spouse did not get any cheques at all, and all kinds of other things that were wrong with the way that ministry was administering the program.
I know the minister stood up in the House the other day and gave his staff all kinds of praise for the fine job they were doing. He related to us the percentage of errors and things like that to indicate that --
Mr. Nixon: I bet that is not what he says in his staff meetings.
Mr. Boudria: Perhaps not.
But although the minister said this, one cannot help being concerned about the fact that the number of errors we have seen in the programs run by this ministry is just mind boggling. And by adding another level of administration to these programs, by adding another program to be administered by these same people, we will, in my opinion, get even more of these errors. More of everybody's time will be spent in trying to rectify those errors. Constituency office assistants and members of this Legislature will again spend a good deal of time administering a program that should not even exist in its present form. As the member for Grey (Mr. McKessock) has suggested, it should be done in a completely different way.
I also wish to touch on part of a statement the Minister of Revenue (Mr. Ashe) made to the Legislature on October 13. I read from the minister's statement as follows:
"The bill to amend the Income Tax Act will enact the temporary home heating credit. The credit is intended to reduce the impact of home heating costs for other low-income and fixed-income Ontarians for the next three years."
In that part of his statement the minister indicates that the purpose of these grants is to assist people in need. Granted, that paragraph is different from the one that refers to the senior citizens. The minister is saying if one is in need and not a senior citizen we will lend a hand; but if one is a senior citizen, whether one is in need or not seems to be irrelevant to this government. That is what disturbs me.
In this compendium of information that was given to us we also have part of a speech by the Treasurer (Mr. F. S. Miller). Actually, it is part of the budget speech, and again we see in the speech:
"Therefore, as I indicated in my budget, Ontario is now prepared to initiate unilaterally a temporary program to offset some of the impact of heating cost increases for low- and fixed- income Ontarians and for pensioners."
Again the minister is saying he wants to help low- and fixed-income Ontarians and pensioners, whether or not they are on a low or fixed income. So it seems like a pretty arbitrary decision to say that once somebody has reached a certain age, even if he is a millionaire, he will be assisted by this government. That is extremely unfair. It may be nice to get, and I guess that is why the government is doing it that way. As my house leader says, when one gets a cheque and sees a picture of this building on it and the cheque is signed by the Treasurer of the province, that is supposed to make one feel happy. Maybe it is supposed to make one remember all those things from now until the next election. But it is not the way the program should be administered.
I will support this legislation reluctantly, not because --
Mr. Villeneuve: Why do you not oppose it?
Mr. Boudria: The member asks why I do not oppose it. It is almost like opposing motherhood. The bill is so drawn that if we oppose it, it will appear we are against pensioners receiving assistance. Of course we are not. As a matter of fact, we would like to see more money in this program so that it can really be of assistance. As the leader of the New Democratic Party has indicated, this is about as good as buying them a sweater, and I think that was well said. I do not say that for very many things that person says, but in that case I think that statement was really well said -- all this was good for was to buy sweaters for the people.
Of course we are not going to oppose it, but I do think the minister should re write this act in such a way as to make sure the people who need it are getting the cheques.
In closing, I want to know -- and perhaps the minister can tell us later -- why they will only be getting these cheques next spring. If there is a need for the money in 1981 the cheques should be made out before Christmas, at a time when people can use the money even more than at other times. Around December 15 to 20, when some of these needy senior citizens need the money even to buy themselves turkeys for Christmas or something like that, they could use that $60 a lot more than next April or whenever the minister wanted to send it. If the minister can address that it certainly would be appreciated because I think the money is not being sent at the proper time.
Just to reiterate: we will be supporting this legislation, but very reluctantly.
Hon. Mr. Ashe: Thank you. Mr. Speaker, I do not think I have ever heard such a great number of speakers with kind of a "yes but," "we are supporting it, but -- "
Mr. Boudria: That is because it is "yes but" legislation.
Hon. Mr. Ashe: I heard one, two, three, four, five, six, seven, eight -- eight "yes buts."
I will try to summarize the points made. Many of them were somewhat repetitive. There were a couple of good suggestions, frankly, and a couple of legitimate questions that I will attempt to answer. I suppose there was a general one about the size of the grant and the fact that it was a diminishing grant. Rightly or wrongly, whether the members agree or disagree, when the Treasurer announced the program he did make it very clear that in his view it was a temporary program that was supposed to be self-destructing after three years and, in fact, is.
The main purpose behind it -- albeit the decreases are the exact opposite way that heating costs are going to go -- was more to cushion the blow in this coming heating season, so that over the next couple of years people can accustom their budgeting to higher heating costs, not that they would be offset by this program. As has already been pointed out there is no doubt it goes down. The $60-$40-$20 is kind of in the opposite direction to the price of fuel, but that is the way it is.
There was some questioning of our ad valorem tax revenues. I would point out to the honourable member for Erie that one can look at a government source of revenue -- it does not matter where it is from -- and try to put it into some spending program and suggest why that program should be or can be larger. But as he well knows, the consolidated revenue fund brings money in from many sources and tries to put it out in what is felt to be a fair and equitable basis.
9:20 p.m.
Our ad valorem tax, contrary to the federal cohorts in Ottawa, is designed to draw in income from motor vehicle fuels. We did not impose taxes on heating fuels, such as was done in Ottawa. I think the member is comparing apples and oranges when he relates the revenue versus the expenditure.
As a matter of fact, if one even thinks back to that ill-fated 18 cent a gallon tax proposed by a rather short-lived government a year or two ago in Ottawa, even they were not going to stick it on the home heating fuels. It goes to prove the Conservatives, generally, have much more heart than the Liberals, even federally.
Mr. Nixon: Why did you pan them? It wouldn't have been defeated if you people had supported it. It's a little late now to turn out to be a federal Tory.
Hon. Mr. Ashe: I am only talking about heating costs at this point.
As far as this bill is concerned, I hope it is clarified now in the mind of the member for Erie. This program only relates to the property tax grant program for seniors and there will be similar amendments in Bill 138, which I doubt we will get to tonight. If we do not, it will be Thursday when we do the Income Tax Act. Of course we can only amend something relative to the act in which that program is enacted and is relevant.
There were quite a number of comments on the old system versus the new system; that is to say grants versus credits. As we all know, those under the age of 65 still do use the credit system through their income tax.
There was a questioning of why the grant -- and this came up quite regularly -- is paid next spring rather than this Christmas as a Christmas present. There has been some other suggestion that we like to send grants and cheques and so on. I would suggest there would be a lot of howling over there if we sent it enclosed with a Christmas card rather appropriately painted or coloured in blue, with blue snow, et cetera. I would suggest there would be some very legitimate criticism from the members opposite. We just would not do things like that on this side of the House.
There were some suggestions by many that this program would increase greatly the administrative work load and there would be separate cheques, separate envelopes, separate postage -- to use the specific references by one. By sending something out in December, that would be exactly what it was. That is not what we are doing.
There is no additional administrative work load because of this program at all. We are adding it to the property tax grant interim cheque that goes out early next spring. It is an add-on -- not a separate cheque, not a separate letter, not a separate envelope, not a separate stamp -- because we do recognize that we have to absorb those massive increases the federal government is imposing in the postal system to try to make it work. I doubt whether it will but they are going to try. We recognize that and of course we are going to keep our mailings and administration costs to a minimum.
There were several comments, vis-a-vis the property tax grants and the sales tax grants and a few problems with them. Last week I stood in my place and acknowledged that we have had a few problems. When one is dealing with $1.4 million in cheques, when one is dealing with a file based on seniors that we receive from the federal government's old age security files, that immediately goes out of date even one day after we receive it, let alone a few weeks or months -- yes, there are going to be some problems.
I think if people would think about and recognize the age group we are talking about -- they are generally fairly mobile. Unfortunately there are people coming into that age bracket every day and there are seniors who are leaving that age bracket every day. So some of the problems pointed out did happen. I would like it if we had a 100 per cent success rate and a zero error rate, but we all know even computers are human. They make mistakes, too, especially if a human mistake is fed into the computer.
All in all we have delivered the program we said we would. The sales tax grant went out with few hitches. I have not heard of anybody who got four or five cheques. If anybody has please let me know. I know of a few who got two or three. We know the reason they did and that has been cleared up. It was a few hundred and, out of 846,000, I would suggest it is in the order of one tenth of one per cent. It was minute.
While the member for Hamilton Mountain was indicating his support, he used some of the words in my statement on first and second reading and I will just show how they tie in. The first one said, "to offset some of the impact," and the second read "to cushion some of the impact." I think he would agree they do mean the same thing. That is all it was designed to do. It never did say it was to pay for the extra costs of heating.
He did make a reasonable suggestion, vis-a-vis the off-oil program, that these same moneys could have been used to supplement and complement the federal off-oil program as a grant of up to half the conversion cost up to $800. That is reasonable and I do not deny the sincerity with which it was made.
At the same time, I would suggest the same seniors who are getting these $500 grant cheques and the sales tax grant of $50 or $100, depending whether it is a single person or a couple, could put that grant towards the off-oil grant program and have $1,300 or $1,400 which in most instances would probably pay for the conversion. I know some seniors are doing exactly that.
The member for Windsor-Walkerville in his indication of support said it was a step in the right direction. He asked whether people in rental accommodation qualify. Whether one owns one's home or rents, one qualifies on the basis, and there is no distinction, that if one qualifies for a property tax grant, one also qualifies under the same criteria for a heating tax grant. If one does not qualify for a property tax grant, one does not qualify for a heating tax grant. Of course, there we are talking about people in institutions such as hospitals and those facilities already subsidized by tax moneys through the Ontario government.
The member for Cornwall was talking about why it is temporary and why it is declining. I hope I touched upon that. He mentioned the comparison with the car rebate program. I would suggest they are really apples and oranges. One of the problems the Treasurer has to react to is different situations in our economy. There is no doubt heating costs and our seniors are one sector that deserves consideration and, under this government, receives it. Similarly, when one gets to a situation where it was quite conceivable one third of our major automobile dealers in this province might be out of business in the next few months I think programs sometimes have to be designed to take care of that problem.
Unfortunately, by law he did not have an option whether the rebates would be given on the Russian-built car, the Japanese-built car or the North American-built car. That issue was determined in a court of law before and, as much as we do not like it -- and I think the Treasurer alluded to that in answer to a question put to him -- we are stuck with it.
9:30 p.m.
The question was brought up, why pay it to millionaires? That would include, I would suggest, members of the family of the member for Brant-Oxford-Norfolk but that is the way it goes. Sometimes these decisions and considerations are made as to whether a new administrative program should be set up to save $X million and whether, to use somebody else's words, we want to make a make-work program.
It was the wisdom of the Treasurer, administratively supported by the Ministry of Revenue, that it was easier to have a program requiring no extra administrative costs, even though one may be putting a little more into the system than possibly one would under other circumstances. I would suggest if one saved a few million dollars by trying to be restrictive in where it went and then spent it in administration, that is not much of a benefit. The government has already enriched the Gains program in the past year. I do not debate at all the quality and the deep thinking of the individual who put that forward. It was a very valid suggestion and it is quite legitimate. Those programs are always under review within the abilities and capabilities of the government to provide funds.
I guess we are getting down to the end. I just have to comment very briefly on the kind remarks, I think, of the member for Brant-Oxford-Norfolk. At times they seem to be complimentary and at other times I am not quite sure. Being a very positive person, as I always am, I can see the excerpts from Hansard appearing about 1985 on certain documents that might end up on the street. I know how well regarded the honourable member is throughout Ontario, so having his endorsement would add greatly to my electoral appeal in the great riding of Durham West.
I think I have covered most of the points. In any of these programs -- whether one is talking about the sales tax rebate grant, the property tax grant, the farm tax rebate, et cetera -- any recipients who feel they do not deserve, want or need them can always make a donation back to the crown and it will be willingly received. I know that is probably what the honourable member opposite does when he gets his farm tax rebate every year. I imagine he shakes as he endorses it, and sends it back saying, "Dear Bill," or "Dear Frank, I am giving this back to you, because I know you need it more than I do."
The last issue that was raised by the member for Prescott-Russell (Mr. Boudria) relates to the excellent investment this government is finally making in updating its aircraft to better transport some of the senior people therein. Let me just suggest we cannot sell it yet, because we do not have it yet.
Mr. Boudria: Sell your option on it.
Hon. Mr. Ashe: We have already taken it. It is being finalized and finished right now. But we in this government will use our assets more properly in the Ontario air force than the federal government has done, particularly in a certain issue a week or two ago when three federal ministers used three jets to go west within three hours of each other. With one jet here in Ontario, it will be very difficult for us to do this.
Motion agreed to.
Ordered for third reading.
ASSESSMENT AMENDMENT ACT
Hon. Mr. Ashe moved second reading of Bill 142, An Act to amend the Assessment Act.
Hon. Mr. Ashe: When I introduced Bill 142 for first reading on October 15, 1981, I made some explanatory comments that I would like to expand upon as we consider the bill in detail. Although my comments on this bill are somewhat more lengthy than on the other two, they may answer many of the concerns and queries in the minds of the honourable members and, in the long run, save time.
This bill has three main purposes. First, the bill will defer to December 1982 the return of assessment rolls at full market value across the province. This provision of the bill will allow the 120 municipalities currently considering the section 86 reassessment program to proceed, if they so choose, with its implementation for taxation in 1982.
As I am sure my colleagues are aware, the objectives of the section 86 program are to provide municipalities with defensible tax bases to ensure that assessments within property classes are equitable and to provide ratepayers with assessments based on market value, a concept they can clearly understand, especially if they choose to compare their assessments with those of similar properties.
To date, 247 municipalities have successfully implemented the section 86 program. The addition of the 120 or so municipalities currently considering its implication in assessment year 1981 for taxation year 1982 will result in nearly half of all the municipalities in Ontario being reassessed in the last four years. This is indicative of the municipalities' acceptance of the program and the substantial progress my ministry has made.
The bill also proposes some changes to the enumeration process. In municipal election years, we will be conducting a full-scale enumeration in the usual manner. That is, we will be collecting information from all occupants to produce statistics on population and school support and the voters' and jurors' lists. While limiting a full-scale enumeration to only those years in which municipal elections are held, my ministry will be able to redeploy the savings and resources to improve its services to municipalities, school boards and ratepayers.
In off-election years, we will carry out a partial enumeration, which will focus on all multiple residential rental properties with seven or more units. We have found population changes occur more frequently in multi-residential rental properties. The data generated from this partial enumeration will be supplemented by statistical data on occupants through (1) recorded ownership changes to all properties and tenancies of all commercial and industrial properties, (2) new construction and (3) verification and collection of new data concerning vacancies.
While the census in non-election years will not provide as comprehensive a population count as that produced through the full-scale enumeration, the combination of the data gathered during the partial enumeration, coupled with the supplementary information I have just highlighted, will provide a valid data base for municipal and school board planning purposes.
One of the major purposes of enumeration is to generate population data for the calculation of grants. The Ministry of Municipal Affairs and Housing will ensure that grants to municipalities are not adversely affected by this proposal.
Another major purpose of enumeration is to provide each ratepayer with the opportunity to designate his school support. Accordingly, the bill also provides that school support information will now be shown on assessment notices and rolls. This will be accomplished by transferring the responsibility for recording school support designations from the municipal clerk to the assessment commissioner and by reflecting school support information on assessment rolls and assessment notices, which are mailed to every tenant and owner of property in Ontario. This measure will provide ratepayers with timely school support information and an expanded time frame within which to amend their school support if required.
In support of that, members are aware of my ministry's program of assessment open houses. The program will be expanded this year to afford every ratepayer the opportunity not only to discuss his assessment with the neighbourhood assessor but also to make any correction to his school support without having to go before the assessment review court. Once the assessment roll has been returned to the municipal clerk, the ratepayer will still have the right to complain to the assessment review court and have his school support changed in that manner. It is intended that school support appeals will be dealt with without requiring the taxpayer to appear before the assessment review court, since a prima facie declaration is sufficient to effect the change.
Finally, the bill clarifies and strengthens certain administrative provisions in the act. It is not my purpose to review these in my introductory remarks, but I do want to highlight two that will interest the honourable members.
Section 14 of the bill addresses the assessment of residential rental premises that are converted to condominium ownership. Currently, under section 65(2), a multi-residential rental building is assessed at a higher level of assessment than a condominium unit enjoying the same level of assessment to market value as a single-family owner-occupied residence in the area.
Recognizing the property tax benefit inherent in section 65(2), owners of multi-residential rental buildings in several municipalities are converting their properties to condominiums with the intention of continuing to rent the units. In larger municipalities, this trend has significant implications on the assessment tax base.
This section will serve to protect the tax base of those municipalities where the situation I just highlighted is prevalent. It also will ensure that bona fide condominium units will continue to be assessed as single family, owner-occupied residences.
9:40 p.m.
The second administrative provision that I want to bring to the members' attention is contained in section 6 of the bill. It has the purpose of providing that municipal taxes are to be adjusted only when the appeal of an assessment is finally determined. This will avoid an interim adjustment of taxes on the basis of a decision that may subsequently be overturned, or altered, on appeal.
In connection with this, it is worthwhile noting that the vast majority of home owner assessment appeals are resolved at the assessment review court. Naturally, any reduction in assessment would result in a refund of taxes at that time, since very few home owner appeals are taken to a higher court. Both of those appeals from the assessment review court relate to commercial, industrial and multi-residential properties.
That is the end of my opening remarks relative to Bill 142.
Mr. Haggerty: Mr. Speaker, I want to address myself to Bill 142, An Act to amend the Assessment Act, and to support the principle of the Bill.
The minister has given a detailed outline of the proposed amendments, and I am delighted that he covered the matter of a census to be taken every three years. I am not quite sure why the ministry has chosen to carry out a census every three years. As far as I know, there has been no amendment to the Municipal Act, although the government is going to change the Municipal Election Act from two years to three years. With the proposed amendments under the Assessment Act, I suppose we can look forward to seeing an amendment to the Municipal Act that would indicate we will be moving from a two-year term to a three-year term for municipal councillors and school boards.
The minister did assure us that, once the census or enumeration has been taken throughout a municipality and if there have been a great number of changes in the number of persons in a municipality related to this area, if the population has increased, some adjustment will be made to the grants formulas for unconditional grants and per capita grants. Additional funding will be coming from the province to the municipalities; so there will be no shortcomings in this area. That does relieve some of the doubts by municipal councillors relating to this area.
In the area of the amendment as it relates to school support, whether it be a public school or a separate school, I can see there is merit in the changes there. But I question whether, if you want to appeal it, you should have to appeal it to the assessment review court. I find that there is difficulty in that a person dealing with local municipalities and with, say, the Planning Act -- now it would the Education Act -- will perhaps have to lose a day's wages to make an appeal.
The minister is shaking his head to indicate no. But at one time municipality offices were open on a Saturday morning, giving a person working from Monday to Friday the opportunity to go in and review his assessment, to review the matters with the clerk and to file an application to whatever school board support he wants his property taxes referred to. I think it was under a section of the act at that time that in June of a year, if anybody wanted to change their school support, they would have to make an application to the clerk. That is important.
Now, as I interpret the act, one has to make an application to the assessment commissioner. I do not have to tell the minister the difficulties in this particular area. In the Niagara region, where we have an assessment commissioner, he could be in Hamilton and making contact from Hamilton to Port Colbourne or Fort Erie; one is looking at a distance of 50 miles. I do not know what difficulties other municipalities may encounter when people want to change their school support in terms of the distance they have to travel to make contact with the assessment commissioner.
I believe the old practice under the present act was to go directly to the clerk of the municipality and he initiated the changes to the assessment commissioner. It is always great when one can turn directly to the clerk of the municipality, who perhaps can be more helpful in this area, rather than trying to get hold of an assessment commissioner or assessment officer. I feel this may cause some difficulties for people who want to change their school support.
I suggest that, even as it is now with the assessment practices in Ontario and particularly through regions and counties, at one time one could go right to the municipality at any time through the week and get assessment information. One cannot do that today, because assessors are not located in the municipalities. I feel this regionalization of government services sometimes is to the disadvantage of the taxpayers in municipalities. I draw that to the attention of the minister. I think he is getting farther and farther away from the citizens who may want answers to some of the problems they may encounter in changing their school support.
I understand that a number of Roman Catholic school boards do have a particular person working for them who deals with nothing but this area of separate school support. From the mail I receive here and at my riding constituency office, it seems they are looking for additional assistance through changing the assessment and building their support. They are not sitting back and taking this easily. They are out working to get increased Roman Catholic support for their school system, and one has to give them credit for that. They are out there working to get people to move in that direction.
I guess everybody, even the public school system, is looking for additional funding. I do not have to speak of the difficulties in that particular area. At one time the province was paying about 60 per cent of the cost of education to local school boards. Since the government is getting larger and school boards are getting larger, the cost now has shifted more on to the taxpayers and on to the area. The cost shared by the province is only about 51 per cent of the total cost of education. So there is a great shift back to local municipalities, and this is why each one of them out there is putting a drive on to get as many supporters as it can in either of the two school systems.
It is a fight for the dollar to help sustain a good school system and perhaps if the promise came through -- and the government promised this over the years -- again I say to the minister we are here to help him keep the promise to go back to the 60 per cent that we had a few years ago and that was promised in one of the elections. I suggest that is something he should be looking at, and he should come forward with that promise.
Another area I want to deal with is the following matter. I suppose we have to give credit to the document I have here. This is from the critical evaluation of the property tax system in Ontario prepared for the Ontario Real Estate Association by Ronald B. Hopper in January 1981. He talks in particular about the change in the condominium section, trying to decide on the language to interpret the word "vicinity." This was one of the amendments that had come forward.
When I look at this section about condominiums which the minister has discussed, there is another area to look at: Why are the developers of, say, rental units moving into condominiums? There must be a reason for it and, if the assessment is going to be lower in the condominiums than it is in rental property, then there must be some inequities in the assessment of the market value of rental property. If this is what the minister is doing, then he is driving these developers into condominiums; he is going to move them from high-rise rental units, which will not be available for a number of people in Ontario, and he is going to create shortages.
9:50 p.m.
Maybe he has used the wrong formula to assess high-rise residential property. Is a person who is a developer and who has rental units available so different that he should be assessed much more than the average residential property or condominium property owner? Is the minister driving them that way because of the method that is used in the value of assessment on rental property? If so, then I think he had better take a good look at it, because he is going to create a serious shortage of rental units in this area.
I find it alarming, because if a person is renting the property there are other ways for the government to get tax revenue. If there is a huge profit to be made on rental property, they will pay it in some form of income tax. I suggest that this is an area the minister should look at. He cannot tax everybody too heavily, because he will drive them the other way. This way they are going into condominium units.
Of course, he has this amendment here to plug the loophole so that you have to buy it, not rent it. But I suggest that he is causing the problem.
The other area that I think is of much more concern to a number of us, and it has been brought to my attention in his brief, is one that relates to section 16, relating to the deferring of the market value assessment. The minister told us that a number of municipalities -- I believe it is 120 more -- have moved in the direction of section 86 of the act, and he indicated that about 50 per cent of all the municipalities in Ontario have moved in that direction.
I suppose this is the only alternative they have, because the minister is not going to bring in market value assessment. I was looking in here, and I thought they had indicated in here -- yes, they have, on page two of their brief: "It has now been 10 years since the province assumed the assessment function in Ontario, and little has been accomplished. We are now told that market value reassessment has been shelved indefinitely."
If that is the case, and this group has been told that market value assessment has been shelved indefinitely, why does the minister or this government not have the courage to come in and say, "We have shelved it, and we want to remove it from the Assessment Act"? Every year he brings in the same amendment, and he is deferring it for another year. He cannot have it both ways.
It is interesting that New York state was running into the same difficulty in relation to market value. Here is what they have said, and this was taken from the Buffalo Evening News of October 29, 1981:
"The New York state Legislature passed a bill that for the first time in nearly 200 years makes fundamental changes in how property is assessed in New York state for tax purposes. The measure at least temporarily ends six years of controversy that began in 1975, when the court of appeals ruled that the state must comply with a law on the books since 1778 requiring all property be assessed at full value. The price of a home or commercial building would bring as sold. Since that ruling, assessing units have moved to full-value assessment."
I suppose this would be fine, too, if it made it mandatory in the United States, but it is every other municipality that may want to use this procedure. "By appealing the almost two-century-old law would likely stop most of that movement." They have shelved the principle of continuing with market value assessment in the United States, because it has not worked and they cannot administer it. They came up with a program that they call revaluation, and I think this is the area that New York state will be moving into. It perhaps would be fairer and more equitable to move in this direction.
I believe I have suggested to the minister over the years during which I have been critic in this area that there is nothing wrong with the old assessment practices, provided that the assessment manual is applied across Ontario; but he failed to do this until he brought in the amendments to the Assessment Act -- I believe it was back in 1970 -- and he has frozen the assessment from that day up until now.
Section 86 is a good section as far as it goes. It does remove inequities on similar properties within that municipality as it relates to residential property, but it does not go any further than that. It should include industrial and commercial properties. All we are dealing with under section 86 is residential property.
The minister shakes his head to indicate no. I do not know. I have a letter to the editor here, and the headline reads, "Market Value Assessment Not Accurate Gauge: Writer." This letter is from Ronald G. Birch, Niagara-on-the-Lake, chairman of the Property Owners Association for Tax Reform. The minister knows this one; I am sure he has read it. It says:
"The Editor: We refer to a letter to your paper of Friday, October 2, 1981, 'Market Value Views Confusing,' by David Rosier, MIMA, Institute of Municipal Assessors of Ontario.
"Our letter was well intentioned, but was nevertheless confusing and inaccurate in Mr. Rosier's mind, although he claims to be an expert. Our answer to Mr. Rosier's second paragraph is that we are now dealing with the end of the twentieth century and not with the archaic methods to which he is referring and is still accustomed.
"Quote: 'The courts to the highest level consistently interpreted actual cash value and market value to be synonymous.' It is absurd for Mr. Rosier to have mentioned the various stages that property assessment has gone through over the years. He has not admitted that the 'values' and regulations, not to mention the Assessment Act, were never adhered to or followed;" -- I would have to agree with that -- "nor were they used in section 86(3) reassessment.
"Mr. Lettner, Assistant Deputy Minister of Revenue, has agreed with the statement made by the Property Owners Association of Niagara-on-the-Lake in the presence of the Honourable George Ashe, Minister of Revenue, that 'the system' used for reassessment under section 86(3) is essentially the same as all previous systems used in this century, thereby totally ignoring 'actual values,' 'cash values' and the modern term 'market value.'
"We agree that market value is used in many places, but there are very few places where it is applied properly or where it works satisfactorily. There are more places where it causes havoc due to the fluctuation of the market and improper application, creating more inequities and excessive tax revenue in various sectors. Remember Proposition 13 in California?
"Mr. David Rosier in his seventh paragraph is referring to the market value assessment of the 1940s, 1950s and 1960s. We have a letter from Premier William Davis saying that even after reassessment under section 86(3), farm properties were not assessed at actual market value.
"We have also a letter from the Minister of Revenue, wherein he states, 'When section 86(3) program was introduced in the town of Niagara-on-the-Lake, every property was assessed at its market value as of 1975."
The Deputy Speaker: Is it worth while to bring to the attention of the member that under standing orders one is not supposed to read at length?
Mr. Haggerty: I will come to where they really get to it:
"Mr. W. G. Lettner, assistant deputy minister, stated in his address to the Ontario small urban municipalities in May of this year, 'The advantage of section 86(3) is that it allows ratepayers to find out what their market value is or what their opinion of market value is,' also 'that section 86(3) is a first step towards market value assessment'."
The minister cannot have it both ways. Mr. Birch goes on to give examples: a property bought in 1974 for $3,000 had an assessed value in 1975 of $42,000; a property bought in 1975 for $100,000 was assessed in 1975 at $52,000; and a property bought in 1975 for $27,000 was assessed the same year at $37,000. One can see the inequities and discrepancies that still exist in this particular area of assessment under section 86(3).
10 p.m.
That brings me to another point. It is a voluntary measure if the municipalities want to venture into section 86(3) of the act for reassessment of certain properties within the municipality. That is fine, but there are areas where, when one walks into regional government, one or two counties are taken in where the apportionment cost varies considerably. For example, in my area I am sure that, if section 86(3) applied across the whole region, it would be acceptable and would remove the inequities that may exist in larger municipalities because we do not touch the industrial sector.
In regions like the Niagara region, and I am sure there are others, one has a healthy industrial segment. Where section 86(3) applies to a rural municipality, they can be short-changed in the apportionment costs to the region because of the reassessment within that community. It does not change the overall numbers but it changes where there is a discrepancy for persons --
Interjection.
Mr. Haggerty: Mr. Speaker, you had the same problem and you know what I am talking about. One of the faults with this government is, when it introduced a restructured county form of government and brought the cities back in, we should have had a reassessment at that time to find out actually what method they were using in assessment.
In the county I represented a few years ago, the assessment value at that time was between 33 per cent and 37 per cent of what they considered market value, which I thought was a fair approach to take. They came in with market value that is supposed to be 50 per cent of the value. That has been shelved year after year, and it does not remove the inequities in all the municipalities. Some place along the line, smaller municipalities are perhaps being assessed more and perhaps in proportion have to carry a higher cost of the regional levy than a healthy municipality with a healthy assessment.
I am talking about an assessment ratio of maybe 50 per cent industrial and 50 per cent residential. Take a smaller community that may have 80 per cent residential and perhaps 20 per cent commercial, and I can tell the minister there can be a major tax shift on to those property owners in that area and throughout the region.
I suggest to the minister that if he gets off his good intentions and withdraws market value assessment, comes in with some form of reassessment at 37 per cent of the market value today and then starts from that area, it will be a step in the right direction. But it has to be done with uniformity across all the regions and all the restructured counties. I suggest the minister should be moving in this area.
As long as the minister is going to bring in a bill every year to further delay or defer the implementation of market value assessment, then I do not think it is going to resolve the problems that face the municipalities today.
The minister cannot have it both ways. I think he should show some of the courage that was shown in New York state and say, "Look, that is what we are going to do." As I recall, I believe that was the old assessment practice years ago. If we go back a few hundred years in Ontario, assessment was perhaps done more equitably than it is now, because it was based on the wealth of the property owner. For example, if a person had 10 head of cattle, he paid so much per head. If he had so many horses, he paid so much. The same thing went on down the line. It was based more upon wealth than anything.
The Deputy Speaker: Too arbitrary.
Mr. Haggerty: Too arbitrary? Well, that is when the lawyers get into the picture. But they are still here even under the amendments to the act. Maybe it is a matter that should be based on income. I have often heard my former leader, the member for Brant-Oxford-Norfolk (Mr. Nixon), say this is the approach we should be taking, one based on income.
Looking at the manual some people have today for assessment, if one goes by what they are trying to interpret, I do not know how they can walk into the house and say, "Do you have oil paint on your walls or do you have latex or semi-latex?" One is worth 10 cents a square foot and the other is worth 13 cents a square foot. It is hard to determine the actual value when somebody comes. There is only one person who knows the actual value of property --
The Deputy Speaker: The person buying it.
Mr. Haggerty: -- the person buying it and the person selling it.
Mr. Charlton: That's two, Ray, not one.
Mr. Haggerty: That's right. In Sweden, I believe the practice is that the property owner puts a value on his own property. If he sells it for more than what it is assessed for, then it all goes to the state or to the province.
I suggest there are other areas, and I suggest that it is time for the minister to get up and say, "We are not going to introduce market value assessment. We are going to come up with some other program." I am sure if he sits down with the municipalities, they would come up with a fair and reasonable approach to bring equity within assessment to the municipality without him having to threaten and to say, "We are going to move to market value assessment." They have no intention of doing it.
For 10 years they have held it in mothballs. The former Treasurer, Darcy McKeough, would come back with report after report and say, "We are going to change it." All he did was throw a number up there and try to work around that number, not actually dealing with assessment at all.
When we get right down to assessment, it is nothing but a con game. They raise the assessment and lower the mill rate. They have to do one or the other. It is the only way that municipalities can generate revenue. The time is coming when the municipality will have to pick up another 10 per cent. It is as I said, the province has neglected its responsibility towards the cost of education, and that means the municipality has to pick up 10 per cent. I can think of reports that come before the county if they want to go out to do some major road expenditure. For example, we had consultants come in on that; they said the only way we are going to generate enough revenue to do the road work is to change the assessment. That's why it is a con game. If we are going to spent $10 million or $20 million on a road program then the assessment has to be altered to pay for it.
We will either want to bring in a good road program or get along with just what we can get from the province on grants and live within that, or change the assessment to get additional revenue. It is not that easy to do, since there are not many who are brave enough to go out and do that. I think we have learned from experience in the past that people are concerned about the mill rate.
In fact, years ago, and I am sure the minister will agree with me, it was felt that once the mill rate was up around 100 that was a dangerous level. Municipalities were almost considered bankrupt at that level. In the 1930s a number of municipalities went that way and they said there was no way they wanted the mill rate to get that high. They used to have a practice back in the 1950s and 1960s to change the mill rate a little bit so that it never got that high, but they would always change the assessment.
It is a way to generate revenue for the municipalities. They are getting into an area that is tight for money; so they are going to have to scramble for additional revenues. Eventually, they are going to have to put up the assessment to generate that revenue because the province and the federal government have failed in this area to pass down those transitional grants. I do not have to remind the minister of the Edmonton commitment. If that had come through, perhaps we would have moved in the area of market value assessment.
Mr. Bradley: How well I recall the Edmonton commitment.
Mr. Haggerty: Yes. Those fellows over there have a short memory. That is another one of the promises that they are going to have to live up to over there. If not, they are going to be overnight guests. It could happen, but I suggest there are areas here where they have got to take the bull by the horns and say to the municipalities, "We are not going for market value assessment; we will go to a form of revaluation," and let the municipalities decide what factor should be used, provided it is uniform within a region or county structure.
All property cannot be based upon the values in larger communities, because it changes. I have said time and time again to the minister that if one buys a home in St. Catharines, one can buy the same home in Fort Erie or Port Colborne and pay $20,000 less. It is the same home, built by the same builder. In fact, the same brick and mortar go into it. The member over there who comes from close to St. Catharines might agree with me that the same builder can put up three different houses at three different values and they will still look the same.
You would be surprised at what you can do with a cosmetic approach to real estate property. It is being done every day by builders. If you look into the manual they have today, you will see that there are different categories of homes in it, but I think you will find that the majority of homes built today are nothing compared to the building principles suggested in that manual. It is not a two-by-four any more, is it? It is about a two-by-three, and you are lucky to get that. It is difficult to get four inches of insulation between them.
10:10 p.m.
There is so much wrong with the manual. I believe it was engineered in the state of California. I mentioned Proposition 13, and I hope it does not follow the manual. We thought they had all the answers on the other side, but they do not. New York state has changed its mind already. But they have had the courage to say, "We are not going to market value assessment: it will not work, because there are too many regions in the state of New York," as there are in Ontario.
I suggest that there has got to be a common factor, a manual that will be valid across the province according to what they feel property is worth in a particular region or community. It will work, but not if you do it in a piecemeal fashion or in an ad hoc way by bringing in a bill every year.
I hope it does not go on for another three or four years. Now that the government has a majority, I hope it will come forward and say, "We are not going to market value assessment," and let it go back to the regions. Let them have the authority to say, "We are going to have revaluation." There are all kinds of property out there that are not even on the rolls yet in a number of cases.
An assessment notice was brought to my attention recently by a person who renovated and added to his home. His property is being assessed too high in comparison to other properties in his area. That is one of the problems when we have new homes today that are assessed much higher under market value assessment than homes that were built 10 years ago: they are paying almost twice the amount in municipal taxes each year.
In a residential subdivision where the house has been built under a developer all the services are paid for. The municipality does not have to borrow money to finance the services; they do not have to debenture any debt at all, because it has been paid for by the developer. Yet their taxes are almost three times as high as those of any other residential property in a municipality.
I find it in Fort Erie, Port Colborne and even in Wainfleet. I am sure that if I went into the member's area, I would find the same thing. I do not think this is a fair approach to take, since there has been no cost to the municipality.
Another area the government should look at is where the developer is forced to put in underground cable for residential housing. That can be damned expensive in some municipalities where it is all rock. That is another cost that is added to the property owner's assessment, because the value is there. That is wrong. Sometimes you might say, "Well, the utility has the responsibility for putting that wire up there." But when it comes to some developers, some municipalities will take a certain place and say, "Well, it is going to be underground cable," and the poor guy who is buying that property has to pay an extra $5,000 for the underground service. Yet it belongs to the utility.
Mr. Dean: He does not have to buy it.
Mr. Haggerty: Oh yes, he does. Municipal councils say this is what has to be done. If he wants to buy property there, he is going to pay that cost. The member says he does not have to buy it. Well, if there is not much property for sale, if that is the only home for sale, he is going to have to pay that price if he wants that piece of property.
Even section 86(3) to a certain extent removes some of the equities within the same properties.
Hon. Mr. Ashe: Inequities?
Mr. Haggerty: Not in everything, no. I do not think it touches the commercial or industrial sector at all.
Mr. Dean: Sure it does.
Mr. Haggerty: The minister say it does. I have not seen that, and that is not the information conveyed to me. It just relates to residential property.
Hon. Mr. Ashe: We'll give it to you right from the horse's mouth.
Mr. Haggerty: I hope it is from the horse's mouth.
We do support the bill. Now with the majority government they have over there, I wish they would either have market value assessment or remove it completely from the act. They cannot defer it year after year. We will gain nothing by it.
Mr. Charlton: Mr. Speaker, on behalf of the members here this evening, I wish to thank the member for Erie (Mr. Haggerty) for providing some comic relief. He commented about the member for Wentworth (Mr. Dean) being an overnight guest, and it was so nice of him to provide a sleeping potion to go along with it.
I want to comment on a number of aspects of this bill and briefly slip in a response to some of the minister's comments in his wrapup on the last bill, since this is probably the only opportunity I have to do that.
Hon. Mr. Ashe: Not relevant.
The Acting Speaker (Mr. Cousens): We are speaking to Bill 142.
Mr. Charlton: I agree, Mr. Speaker, and Bill 142 deals with assessment and property taxes. The minister was commenting on seniors' property tax grants and how seniors should be able to take a property tax grant, which is supposed to assist them in paying their property taxes, and use it to convert their furnaces. I do not consider that a very appropriate approach to the use of a property tax grant, which is supposed to assist them with their property taxes. If the minister wants to assist them with home heating, let us do that. But let us not play games with other programs.
I am rising in support of this bill. We do not have many serious objections to the items contained in this bill. I want to comment about some of the approaches reflected in the bill. I have no problem with the sections dealing with enumeration and school support. I am somewhat happy to see them. In the case of school support and the changes made over the past number of years, this reversion to what we used to do in terms of the responsibility of collecting school support information and setting it out is a reflection that sometimes change is not all that good.
Perhaps we should look a little more carefully at the changes we make from time to time in the processes we use in this province, especially the processes that are tried, tested and proved by lengthy periods of success. This particular revision and movement back to a process we used to have in Ontario is an appropriate one but speaks to the question of looking at and thinking a little more carefully about the changes we make, especially administrative changes which affect people's ability to participate in processes set out in legislation.
For example, in his opening remarks the minister made the point that going back to the process of setting school support in the enumeration process and through the Assessment Act process extends the time in which they can avail themselves of changes in the school support they end up being shown with. This is very appropriate. In terms of citizens' relationships with government, especially as government becomes bigger and more distant, the more opportunity citizens have to find the problems in that system and to deal with them, the better.
10:20 p.m.
Going to a full enumeration only in election years is appropriate in terms of the costs we have gotten into in enumeration in the last few years, especially since the takeover by the province. There was a time, not all that long ago but long forgotten since the government took over the assessment process, when the assessors themselves used to do the enumeration as well as doing all the assessment. Unfortunately, experience has shown that when they were trying to do both jobs, the assessment of real property and the assessors' ability to keep assessments updated suffered dramatically. That is reflected in the current assessments across most of the province. So it is appropriate that the enumeration process should be separate.
It is also appropriate that we try to limit the cost of that process. I offer one caution to the minister in this. I think the annual enumeration of large rental residential accommodation is in part an effort to deal with what I am going to comment on, but in the enumeration process that has been carried on by the assessment people in Ontario there has been some problem, especially in large residential rental properties, of finding people home, and never getting up-to-date names on to the assessment roll.
The caution simply is: If we are going to go to a two-year enumeration, and possibly a three-year enumeration if we should happen to go to three-year elections at some point, the job is going to have to be done very carefully, because even with the annual enumerations we had some problems in obtaining accurate names, especially in large residential properties. It is important and imperative, in terms of the democratic rights of taxpayers in the municipalities, that their government see to it that the enumeration is done properly and thoroughly.
The sections of the bill dealing with the postponement again of market value, as my colleague the member for Erie suggested, raise some serious questions in terms of this government's ability to really deal with the problem of overall and significant property tax reform in the province.
There is continual reference, this year, last year, the year before and the year before that, to the benefit of the section 86 program, and I have said repeatedly in this House, "Yes, there are some benefits in the section 86 program." But that program does not deal in any overall significant way with the problems in the property tax sector in Ontario. I think the minister is well aware of that. If he is not, then he should sit down and read the comments of his predecessor in this House.
The section 86 program has some benefits for many taxpayers in Ontario, but it does not come close to solving the problems in the property tax sector. That is a major job still to be gotten on with. There are many of us, even some of us who worked in the assessment division and who worked on market value, who are not sure that market value is the correct approach to take to solving those problems.
I will skip to that now. The sections of this bill which deal with rental premises being converted to condominiums and set up a transition period for property tax purposes point very clearly to the problems that I and some others see with the whole market value approach to property taxation.
What I would like to explain to the minister and the other members here tonight is exactly what those sections mean. I do not think anybody here is going to disagree with these amendments in the context of the Assessment Act as it exists. But I think all members should be clear what these sections really mean.
The Acting Speaker: Might this be an appropriate moment for the member to conclude?
Mr. Charlton: Perhaps you are right, Mr. Speaker. I can conclude my comments the next time this bill comes forward, presumably Thursday night.
On motion by Mr. Charlton, the debate was adjourned.
The House adjourned at 10:26 p.m.