Hansard Transcript 1986-Jul-02 | Legislative Assembly of Ontario

Mr. Sheppard: I am pleased to have the opportunity to comment on the proposal brought forth by the Minister of Agriculture and Food (Mr. Riddell) and the Minister of Municipal Affairs (Mr. Grandmaître) with respect to the policy statement on food land preservation. As members are aware, agriculture is the most prominent industry in my riding of Northumberland, where it has been pursued successfully since the 1830s.

I am in agreement with the principles of the statement. However, there is one section of this proposed policy that is causing considerable concern to the agricultural community in my riding. The area of concern is the restrictions on severances for retiring farmers. Farmers need all the assistance they can get at this time when they are having difficulties making ends meet. Severances provide an additional source of income. More important, they assure a retirement home.

I am concerned that, because of the need to serve the wide spectrum of Ontario agriculture, the needs of individual municipalities will be overlooked. We must keep in mind that one system suitable for central, southern and western Ontario could prove detrimental for eastern and northern Ontario. Therefore, I strongly urge the ministers to revise this section of the policy to allow more local autonomy in the determination of farm severances.

INSURANCE RATES

Mr. Foulds: I want to bring to the attention of the House the difficulty the Murillo fall fair in my riding is having in obtaining liability insurance.

The summer is well under way. That means the fall fair season in Ontario is not far off. In Murillo, just west of Thunder Bay, the people are gearing up for their 96th annual fall fair and making plans for their 100th fall fair in 1990. However, after 96 years without a claim and without a liability-related complaint, the Murillo Fair's insurance will end August 1. Why can it not renew the insurance? The agricultural society's president tells us it is because the insurance company felt the policy was not profitable enough.

The Murillo fall fair is not the only victim of the insurance industry. The Canadian Lakehead Exhibition was fortunate enough to have been able to renew its coverage recently. However, it is now paying $15,000 a year for $1 million worth of liability coverage. Last year, they had $5 million, five times as much, for only $2,000, or one seventh of the cost.

This government has to do more than talk about the insurance problem. It has to start doing something. It must make a serious effort to implement some fair solutions in a very unfair insurance market. It must start protecting consumers. It must ensure the Murillo fall fair goes forward this year.

PORK PRODUCERS

Mr. Reycraft: I want to take a few seconds this afternoon to commend my colleague the member for Huron-Middlesex, the Minister of Agriculture and Food (Mr. Riddell), for his recent announcement of a $54-million improvement program for the Ontario pork producing industry.

Pork production generates the third-largest farm-gate income in the province. This new program will help maintain the industry's competitive position in the Canadian and international market.

This program will be of assistance to farmers in two ways. First, it will fund surveys to identify consumer preferences to assist in the upgrading of packaging technologies, and it will help develop new products for domestic and foreign markets. Second, it will provide production initiatives designed to improve the efficiency and the profitability of Ontario pork production.

Furthermore, these marketing and production initiatives not only will benefit the 15,000 pork producers in Ontario, including those in my riding of Middlesex, but will also help to support the 14,000 people who work in the meat processing industry.

I believe this is a worthwhile program that will help to preserve one of the most important agricultural industries in the province.

RENTAL ACCOMMODATION

Mr. Gordon: I want to address briefly the commitment and competence of the Minister of Housing (Mr. Curling) in dealing with the housing crisis we face in Ontario. The simple fact is that the minister is not dealing with that crisis and is not getting more rental housing built in this province. His civil servants may be making policies and programs, but the minister fails to grasp them. He merely parrots, postures, makes grandiose statements and announcements and holds press conferences.

As critic, I have posed innumerable questions to the minister. On at least two occasions, he has claimed the figures presented to him were wrong, despite the fact that these figures come directly from his own policy statements. For example, I have been told in this House that a formula exists that will allow landlords to raise their rents by at least 7.2 per cent on certain rental units, but at the same time he tells us the rents of tenants living in those units will not increase. This is a magic formula indeed. I suppose the gremlins pay the increases.

I asked the minister to find that formula in his guidelines, and he told me it was in his legislation. When we looked in the legislation, it was not there. I asked the minister where it was in the legislation, and subsequently, he read from page 35 of his guidelines a quote that had nothing whatsoever to do with the question.

The minister either laments the past or refers to the future. Meanwhile, the present is in limbo, and despite all the press conferences and parties, the crisis is mounting into a nightmare for many tenants. How can the Premier (Mr. Peterson) tell Ontario that his government is committed to solving the housing crisis?

OCCUPATIONAL HEALTH AND SAFETY

Mrs. Grier: I want to draw to the attention of the government the plight of an occupational health clinic attached to a multiservice centre in my riding known as the Lakeshore Area Multiservices Project, LAMP. This centre has been kept waiting for months for an answer to its funding application and seems doomed to die in the time it takes one ministry to negotiate with another.

Eighteen months ago, LAMP opened its occupational health clinic in response to the needs of its community. This meant directing the time of a health educator to co-ordinating in the clinic, getting donations from the Ontario Federation of Labour and finding a doctor with the necessary expertise who bills through the Ontario health insurance plan. LAMP provided space and administrative support, a very appropriate way to begin a project on a small scale.

It was quickly obvious that the demand was there and that there was a need for permanent and stable funding. Application was made to the district health council, and in July 1985, LAMP was rated as project number one on the list of recommendations to the Ministry of Health for funding. There has been no answer. When I asked the minister to approve some funding quickly, the answer from the bureaucracy was: "How can the clinic close? We have not opened it yet."

Occupational health problems are rapidly becoming of crisis proportions in urban centres. I urge the Minister of Health (Mr. Elston), the Minister of Labour (Mr. Wrye) and the Workers' Compensation Board to sit down with representatives of the community and determine, once and for all, where responsibility lies for funding such independent occupational health clinics.

BRAMPTON FESTIVAL

Mr. Callahan: This is the last opportunity anybody in Ontario or this Legislature will have to make plans to attend Carabram in Brampton, starting on Friday of this week and continuing through the weekend.

On Monday, June 30, I had the pleasure to attend and bring greetings from the Premier (Mr. Peterson) and the government and to give to the Carabram people a cheque for $15,000, which was very nicely given to me by the Minister of Citizenship and Culture (Ms. Munro). That will assist these people to carry out their pavilion.

I invite all members and all the people watching this question period to come out to Brampton. On Friday night at 7:30, the Indian pavilion will be opened by the minister. I am sure they will find Carabram is running alongside Caravan, if not ahead of it. I invite everybody there this weekend.

INSURANCE RATES

Mr. Hennessy: Members will be aware of the problem at the Murillo fall fair sponsored by the Oliver Agricultural Society in Thunder Bay. The fair has been advised by its insurance company that its policy will not be renewed beyond August 1, 1986, because of the hazards associated with agricultural fairs.

A submission for the Murillo fall fair has been forwarded to the Ontario liability insurance pool to determine whether coverage can be arranged, but in these circumstances the cost for insurance may be too high and, therefore, not a solution. This loss of insurance means that fairs, which have been a tradition for many years, will be no longer in operation. I also talked to the Hymers Fall Fair people.

This government has had plenty of time to act positively on behalf of the Oliver Agricultural Society and other agricultural societies wanting to hold fall fairs, but the government has not acted. It has tried to bury the issue under a mountain of task force reports, ignoring the threat to the future of the Murillo fall fair and fairs like it, such as the Hymers Fall Fair, across my riding. I ask the government to act. This is its chance to protect and provide coverage for fall fairs in my riding and throughout the province.

COLLEGES OF APPLIED ARTS AND TECHNOLOGY

Mr. McCague: On a point of privilege, Mr. Speaker: I rise today to seek your guidance with respect to standing order 18.

On Wednesday, December 18, the Minister of Colleges and Universities (Mr. Sorbara) rose in this House to announce the appointment of Walter Pitman to evaluate the government of Ontario's college system. The minister reported to the House that Mr. Pitman would complete his work by March 31, 1986. It is now July 2, three months past the date the minister promised this House the report would be completed.

On June 24, this House ordered that the matter of premature release of the report from the select committee on energy be referred to the standing committee on the Legislative Assembly because the contents of the energy committee's report were printed in the Toronto Star before they were released to the Legislature.

Today, we have yet another example of a report being leaked to the Toronto Star before being presented to this House. Walter Pitman's report is a page one story in this morning's Toronto Star. I realize that, because Mr. Pitman's report is not a result of a committee of this House, it does not compare with that of the report of the select committee on energy, except for the fact that they were both published prematurely.

However, it is a point on which you made some comment on June 10, 1986: "Whether or not assistants...have violated their oaths of secrecy is a question of law and a question upon which the authorities indicate that the Speaker shall not give a decision. Such a matter could, if justified, give rise to an action in the courts; however, it is not one with which the Speaker is able to deal."

My point of privilege is this: You have ruled that leaks to the newspapers are not points of privilege upon which you may rule. However, you do suggest they are questions of law that "constitute a legitimate grievance and certainly involve a question of courtesy to or respect for the House."

If I wished to ask a question about this disrespect for the House and specifically about the apparent violations of public servants' oaths of secrecy, to which ministers of the crown should I direct such a question?

Hon. Mr. Sorbara: On the point of privilege, Mr. Speaker: My friend errs on a number of points, and I think you will agree with me that it is not a point of privilege.

First, when I made the statement in December I said Mr. Pitman would be reporting to me on May 31. That does not respond to the major point the member has made. He has accused me, I think, of leaking Mr. Pitman's report to the Toronto Star. Nothing could be further from the truth.

In fact, the point should be made that Mr. Pitman's work was not work of a legislative committee. Mr. Pitman was retained to offer me sound advice, after consultation, on governance in the community college system. He prepared that report and delivered it to me on or about May 31. We have been preparing a French translation of the report, and, indeed, my critics in the opposition have copies of the report.

The fact is that a reporter from the Toronto Star got wind of some of the recommendations in that report and asked me questions about them, and I responded as openly and honestly as I could. The report is now available to community colleges and to my friend the member for Dufferin-Simcoe (Mr. McCague), if he wishes to have a copy.

Mr. Speaker: I have listened carefully to the member and to the minister. I believe the member was correct in quoting me on my previous ruling. Therefore, it is not my duty to rule on any matter other than that pertaining to a committee report. I cannot find that a point of privilege.

PRESS REPORT

Mr. McGuigan: On a point of privilege, Mr. Speaker: On page 18 of the July 2 Toronto Star, under an article headlined "Jail for Young Offenders Called `a Zoo,'" there appears a picture which purports to be the Solicitor General and Minister of Correctional Services (Mr. Keyes). I rather think the handsome fellow is myself. I wish to point out this error and hope the newspaper will make a correction.

Mr. Speaker: That is certainly a point of personal explanation.

CLERK OF THE LEGISLATIVE ASSEMBLY

Hon. Mr. Nixon: Mr. Speaker, I hope you will allow me to bring to the attention of the House the 75th birthday of our esteemed Clerk, Roderick Lewis. I know all members will join me in expressing our best wishes.

Hon. Mr. Peterson: I join my colleague in expressing the best wishes and congratulations of this House to the Clerk, who has advised all of us over the many years. I am told he first came to this House as Assistant Clerk in 1946 and succeeded his father as chief Clerk in 1955. He has outlasted everybody except the previous administration.

At the same time, I regret to inform members of a sad duty I have: The Clerk has told me he will be retiring. He has served this House extremely well, as we all know. I want to express my very best wishes. His departure will be effective upon the appointment of a successor, and all members of this House will participate in the choice of his successor, presumably getting to that task over the summer.

I have asked the government House leader to place on the agenda the opportunity to express formally the appreciation and good wishes of the House. I expect it will come forward next Monday and will be debated. At that time, all members of the House will have an opportunity to express their good wishes to Mr. Lewis, and Mr. Lewis will have an opportunity to respond in the House.

May I say to the Clerk that he has served this province with great distinction. We thank him and look forward to next Monday, when we can express in more lengthy terms our great affection and respect.

Mr. Grossman: On behalf of our party, I would like to join the comments of the government House leader and the Premier (Mr. Peterson). I cannot resist noting that when the Clerk, Mr. Lewis, first joined the House, the Premier and I were three or four years old. Shortly thereafter, I can remember being in the gallery watching the then Assistant Clerk, later the Clerk, spending many nights in less ruly times, if one could believe it, trying to keep the then less ruly --

Hon. Mr. Nixon: Did the member say "less ruly"?

Mr. Grossman: The member was here then; they were more unruly, particularly in those long, late-night sessions -- many of which, such as two weeks ago -- went all night, when the Clerk was here to make sure things proceeded in as parliamentary a way as possible. My father and I both had the honour to serve under the Clerk's esteemed guidance and advice.

Marking his 75th birthday is a very special day. His name, regardless of what the future holds, will have established itself as an institution in this assembly. My party and I want to join the Premier and the government House leader in acknowledging this fine and important day.

2:20 p.m.

Mr. Rae: This is an occasion of great happiness and one of considerable sadness. I know we will all want to join in celebrating 75 years and many years of extraordinary service to this House. The leader of the Conservative Party has mentioned his family connections. I can safely say that mine probably go back even further, since the Clerk and my father were together at Jarvis Collegiate Institute some years ago.

On behalf of my colleagues, I want to express our thanks for his great service to this House and to this province. I also particularly want to thank him, on behalf of all the members of this House, for the number of occasions on which he has individually helped us out. There have been many times when I have needed to be educated. Indeed, those moments continue. He has given wise advice to everyone in this assembly at various times.

It is a position of unique service. There have been many great Clerks with whom I have had the opportunity to work, both here and in the House of Commons. His own service to this province and to the legislative process has been extraordinary and one of unique quality.

De la part de tous mes collègues, j'aimerais exprimer nos profonds remerciements pour le travail qu'il a fait et pour les services qu'il a rendus à la province et à l' Assemblée législative.

We wish him all the very best as he takes occasion to reflect upon, perhaps write a bit about and educate us more in terms of the process of this place and how we can improve the work of the assembly and of this parliament.

We wish the Clerk a happy birthday. More important, we wish him well in the work that will no doubt follow his departure from the post of Clerk.

2:22 p.m.

STATEMENTS BY THE MINISTRY AND RESPONSES

CONFLICT OF INTEREST

Hon. Mr. Peterson: Government faces no issue more complex than the question of how it can ensure its actions and decisions are based solely and clearly on the basis of the public interest with no reasonable suggestion of a conflict in that interest.

This is not a new question, nor one that is unique to Ontario. Indeed, it has been raised frequently in every democratic jurisdiction. I am sure all parties in every jurisdiction would agree on the need to guarantee that nothing detracts from the basic public trust that is central to democracy. At the same time, our regulations and guidelines must be drawn so as to encourage the widest degree of participation.

I wish to make it clear at the outset that I have the utmost confidence in the ministers of my government. I appreciate their efforts to adhere to the guidelines that have been in place since 1972, but at the same time I must acknowledge that the rules and the system we thought worked well in the past may not be good enough today. It has become more and more difficult to determine what is a genuine conflict of interest as opposed to what might only be perceived as a conflict of interest and the consequences that flow from each one.

It is important to recall that former Premier Davis never regarded his 1972 guidelines as exhaustive or as encompassing all possible situations. They must change with the times and adapt to new circumstances. We must find a more impartial way to examine suggestions of conflict of interest and separate the perceived conflicts from the genuine ones. The tools we currently have at our disposal to do that are imperfect at best.

In the 14 years since guidelines were first introduced, society has undergone many changes, and government must catch up. We must ensure that the principles acted upon in 1972 are reflected in guidelines and regulations most appropriate to the 1980s and the 1990s.

The functions of government and the private sector are becoming increasingly interrelated. It would be difficult to think of a profession or business that does not require regular contact with government and is not affected by legislation and government actions.

Certainly it would be impossible to think of a single piece of legislation that affects none of us in this House. Every piece of farm legislation, for example, could affect every member who owns a farm. Legislation regarding teachers' pensions, to cite another example, affects members on all sides of this House.

Only a political, economic and social hermit could claim to be entirely removed from the business of this Legislature, because to be removed from the business of this Legislature is to be removed from society.

The guiding principle that has been accepted by all is that no one should be hindered from participating in the development of a policy from which he benefits, so long as that benefit is not specific or unique to him. Are the people of this province not entitled to know, however, when their elected representatives may stand to benefit financially from legislation? That, it seems to me, is the other side of that principle.

Moreover, we are now well into the era of the two-career family. The families of politicians are no exception. To what degree are we prepared to limit the business and professional endeavours of the spouses, children and other relatives of those who serve the public? Obviously, the business and professional activities of the spouses of politicians add to the complexity of sorting out what may or may not constitute a genuine conflict of interest.

Fourteen years after guidelines were first adopted, we need to examine them to determine how they can be improved and how they can be most effectively implemented.

1. We need clearer guidelines to deal with issues of the 1980s and 1990s.

2. We need a better mechanism to provide advice regarding ministerial disclosure, a mechanism respected by all members of the House and universally across the province.

3. We need a better decision-making forum to determine what is in fact a genuine conflict of interest.

In bringing our standards up to date in this area, there are many broad questions we must address.

Do current regulations fully and fairly cover all situations that could suggest a conflict of interest in the decision-making process?

How far should we go in monitoring the business and financial arrangements of spouses and children and other relatives?

Even accepting the principle that no conflict exists in the case of members of this House voting on matters that could benefit a group to which they belong, should we nevertheless require all members to declare a connection each time such legislation is considered?

Should there be requirements of disclosure for party leaders?

Should all members of the Legislature be required to file declarations of holdings, given the expanded functions we are trying to ensure for them?

Should there be a restriction on some forms of outside work for all members of the Legislature? Should there be a moratorium before former ministers may accept an appointment to the board of a corporation with which they dealt in office, as federal guidelines require?

Should there be a moratorium before former ministers are permitted to engage in private dealings with the government or represent private clients in dealings with the government? How long should such a moratorium last?

This is by no means an exhaustive list of the questions that must be considered. There are many grey areas in this issue. No doubt, there are many questions of judgement; but there are also questions of whose judgement.

Obviously, all members of this House must always be free to raise any issue that concerns them, but would it meet Ontario's standard of fairness to prevent a minister who has received legal advice that he or she has complied with the conflict-of-interest guidelines to stand accused of a violation because of a conflicting opinion.

Should consideration be given to the establishment of a body that could advise on the appropriateness of arrangements before they are entered into and make recommendations to the Premier after suggestions of perceived conflicts of interest have been raised?

These are just some of the questions that come to mind. They are not hard-and-fast proposals. I would be grateful for the help of all the members of the House in participating and tackling this issue.

We obviously cannot be expected to answer all the questions related to this issue today, but I wish to inform the House of actions I am taking immediately to begin to deal with these concerns.

I am pleased to inform the House that the Honourable John Black Aird has agreed to take on the job of sorting out this issue's long-term implications, ensuring existing guidelines regarding conflict of interest are met in the short term and reporting to me as soon as possible.

Mr. Aird has graciously advised me that he will perform this task at no cost. I requested him to retain whatever assistance he requires, including the use of members of his law firm.

2:30 p.m.

Mr. Aird's mission will be threefold.

1. Mr. Aird will take on the task of examining the statements of disclosure that have been filed and ensuring and attesting that the guidelines have been fully and correctly applied to all assets held by ministers and parliamentary assistants. This will serve as a valuable addition to the system that has been in place for more than a decade. All his findings in this regard will be filed with the Clerk of the Legislature, it is hoped by the end of August.

2. Mr. Aird has agreed to provide an independent assessment of the validity of any suggestion of conflict of interest that may arise between now and the completion of his long-term task. I ask all members, including those of the opposition parties, to provide Mr. Aird with any information regarding potential conflicts of interest. Mr. Aird's assessment will be provided to me for public release.

3. He will consider the entire question of defining and evaluating what is, in fact, a conflict of interest and devising the most appropriate regulations in this area. Mr. Aird will review and make recommendations regarding the value of a permanent independent commission to review suggestions of conflicts of interest and will also study the question of whether such a commission should be involved in ensuring, on a continuing basis, that the disclosure made by ministers and other affected parties is up to date.

He will make recommendations about the form of a commission and the process involved. Mr. Aird will review work that has been done in this area at the federal level and in other provinces. He will meet with the opposition parties and others who have done work in this area. At the very early stages of his work, he will discuss with the opposition parties questions relevant to its scope and the establishment of an appropriate time frame for his report.

At this time, I wish to thank Mr. Aird for his willingness to take on the assignment. I express the appreciation of the government and, I believe, the entire House for his time and effort. His readiness to assist us in this way is typical of the generous commitment he has displayed to the welfare of this province.

Mr. Aird's recommendations will be passed onto the standing committee on the Legislative Assembly to allow for the most thorough and open consideration by all members of the Legislature. I seek the participation of all parties in dealing with this issue as openly, expeditiously and fairly as possible. We all have a great deal at stake. If we are to develop a system that will deal with these questions, all of us must participate.

ALLEGED CONFLICT OF INTEREST

Hon. Mr. Nixon: With respect to the allegations of a violation of conflict-of-interest guidelines by René Fontaine, Mr. Fontaine has advised me that he is happy to appear before a committee of the House. Therefore, I shall be moving that the matter of René Fontaine's compliance be referred to the standing committee on the Legislative Assembly for review and report to the Legislative Assembly without delay.

Interjections.

Mr. Speaker: Order.

Mr. Grossman: I should like to begin by replying to that last quick statement. To fill out the record, I know the government House leader will want to have mentioned that both opposition parties indicated this morning their conviction that Mr. Fontaine's matter had to be referred to a committee of the Legislature and that we were determined to see that happen. That information was relayed to the government this morning.

The more substantive issue continues to be around not Mr. Fontaine's own conduct and his suitability as a private member in this assembly, but the Premier's (Mr. Peterson) own judgement and his responsibility. In that regard, the statement the Premier has just read is totally irrelevant to the events of the last two weeks. It has nothing whatever to do with them. He may use this as a launching pad to try to wash his hands of this and rise above it, but this statement does not deal with the events that have just happened.

I want to refer to the Premier's statement. He says on page 2, "It has become more and more difficult to determine what is, in fact, a genuine conflict of interest, as opposed to what might only be perceived as a conflict of interest...." On this side of the House, we believe that when a minister of mines owns mines, undisclosed in Ontario, that is not something that is difficult to determine as to whether it is a perceived or a real conflict.

The second issue I would like to raise is on page 5. The Premier says we need "clearer guidelines" to deal with current issues. It is not a question of clearer guidelines. The guideline is very clear. It says ministers must disclose their holdings. There is nothing unclear about that. The minister of mines did not disclose his holdings. There is nothing unclear about that. There is no problem with regard to "a better mechanism to provide advice regarding ministerial disclosure." It was quite clear that if the minister owned those shares, he had to disclose them. No better mechanism is required; he just has to disclose what he holds.

Let me read the questions the Premier wants addressed, starting on page 6.

"Do current regulations fully and fairly cover all situations that could suggest a conflict of interest...?" This is not an issue in the Fontaine matter.

"How far should we go in monitoring the business and financial arrangements of spouses and children and other relatives?" This is not an issue in the Fontaine case.

"Even accepting the principle that no conflict exists in the case of members of this House...should we nevertheless require all members to declare such a connection...?" This is not an issue in the Fontaine matter.

"Should there be requirements of disclosure for party leaders?" This is not an issue in the Fontaine matter.

"Should all members of the Legislature...file declarations...?" This is not an issue in the Fontaine matter.

"Should there be a restriction on some forms of outside work for members...?" This is not an issue in the Fontaine matter.

"Should there be a moratorium before former ministers may accept an appointment...?" This is not an issue in the Fontaine matter.

"Should there be a moratorium before former ministers are permitted to engage in private dealings with the government...?" This is not an issue in the Fontaine matter.

At the bottom of page 7, however, the Premier goes on to say, "There are many grey areas in this issue...but there are also questions of whose judgement." That is right. The question remains, no matter what set of guidelines he has. Whose judgement is the issue, and the answer is that it is the Premier who selects the members of his cabinet. He must peruse the behaviour of ministers and their ability to read clear guidelines -- and they are clear in that they say if a minister has holdings, he or she has to file them. Failing to do that, does the Premier believe a minister ought to remain as a member of the cabinet?

On page 8, the Premier goes on to say, "Should consideration be given to the establishment of a body that could advise on the appropriateness of arrangements before they are entered into?" Of what relevance is that? His former minister refused to tell him about any arrangements before he entered into them. This would do nothing in the Fontaine case.

Finally, on page 10, the Premier purports to appoint someone else to exercise his responsibilities, someone else to provide an independent assessment of the validity of any suggestion of conflict of interest. He goes on to suggest perhaps an independent commission should do that.

We simply say that one of the difficult jobs of a Premier is to make assessments on who is fit to hold office in his cabinet. He may arrive at a different conclusion to that of members of the opposition. We respect that, but we will question his judgement to decide to reappoint Mr. Fontaine or anyone else who fails to meet appropriate standards. Mr. Aird or an independent commission can reach an assessment, but that does not remove the burden of responsibility from the Premier to decide who is fit to serve in the cabinet.

Leslie Frost said it best. He always said that if his ministers did not know how to behave, he, Leslie Frost, would put them out of cabinet. The Premier shirked that responsibility.

Mr. Rae: I want to begin by saying that if the Premier thinks that by establishing this one-man commission to be chaired by Mr. Aird somehow the issue has been solved or the political problem in which the government and the Premier find themselves will go away, he is sadly mistaken. It is my judgement that he is putting the former Lieutenant Governor of this province in a very difficult position. That is his choice, and that is the Premier's choice with respect to how he wishes to proceed. If he thinks that by appointing Mr. Aird to this position he is solving anything with respect to the two cases which are now before the House, he is very wrong. He should not delude himself in that respect.

We have had two attempts at evasion by this government. The first was the Premier's orchestrating the calling of a by-election when there was no question for any member of this House of whether the former member for Cochrane North had a right to stay in this assembly. There has been no question whatsoever established as to René Fontaine's right to sit as the member for Cochrane North.

2:40 p.m.

The issue before this House is whether René Fontaine, who has an interest in a mining company which he did not disclose to this House, should be a member of the cabinet in Ontario. That is what is at issue. No by-election and, if I may say so, no commission -- no matter how strongly we may feel about the qualities of the person who is directing that commission -- will solve that issue, that particular problem for the Premier. That is the second attempt at evasion, and it will not work.

The Premier has to recognize that he has an obligation, no matter how much he says the rules are imperfect or the rules are unclear. To quote him, he says, "The tools we currently have at our disposal to do that are imperfect at best." If the government is not willing to enforce the guidelines, it does not matter what they are, how comprehensive they are or how great they are. They could have been devised by Moses and brought down from the mountaintop, but if we do not have a Premier who is prepared to enforce the guidelines, they will not make any difference. That is the problem we have right now. That is where the buck stops.

I am distressed that the Premier has chosen to evade this issue. Most of us feel some tough decisions have to be made from time to time. When a minister files a statement that is incorrect, a statement that omits information that is relevant and that is established clearly in the guidelines, then we do not have to have a by-election.

A by-election is not a process of absolution. A by-election is not some theological process from which somebody comes back thoroughly cleansed. It has no impact at all on the question of conflict of interest. That issue will not go away. It is the issue that is before us and to which the Premier of this province is going to have to respond. Mr. Aird cannot solve that problem and a by-election cannot solve that problem. There is only one person in a position to deal with that question, and that is the Premier.

I want to make it clear that we will sit down with Mr. Aird and discuss whatever he wants to discuss. However, I also want to make it very clear that, given the inability of this government and of this Premier to respond when guidelines have pretty clearly been broken, what we need is not simply a process of guidelines, but a law. We need a law that states clearly what the rules are, a law that sets out those rules and sets out the consequences for breaking them. The Premier continues to talk the language of general guidelines and continues to talk very vaguely. As he has done on many other occasions, he asks a whole lot of questions and does not answer them.

The Premier has to recognize that we are all able to ask questions. Indeed, in our own caucus this morning, I do not mind saying, we discussed the general issue. However, no discussion of the general issue and no raising of 50 different questions are going to solve the problem unless we have a government that is prepared to do the difficult but necessary thing when it has to be done.

Le gouvernement a choisi de ne pas agir. Ce n'est pas une question d'élection partielle parce que ça ne résoudra rien de la question, à savoir si M. Fontaine a le droit d'être ministre dans un Cabinet duquel il a démissionné suite à son refus de déclarer ses intérêts. Ça c'est la question et c'est la question à laquelle seul le premier ministre de cette province peut répondre, et jusqu'ici, il n'y a pas répondu.

2:43 p.m.

ORAL QUESTIONS

ALLEGED CONFLICT OF INTEREST

Mr. Grossman: My question is for the Premier. Last week, after the first time my colleague the member for Sarnia (Mr. Brandt) disclosed a lot of very relevant information about the then Minister of Northern Development and Mines, the Premier was quoted as saying, "If all those things are correct, it appears to me he couldn't continue." He was referring to his minister of mines. Can the Premier tell us what was not correct in the member for Sarnia's allegations that day?

Hon. Mr. Peterson: There were a number of things that were not factually accurate. He suggested that the shares had been transferred on March 3. That is not accurate. That is when they were registered. They were transferred before that. That was just one incorrect thing in the situation.

Mr. Grossman: Would the Premier agree with me that the main thrust of the allegations made that day by my colleague was that the minister of mines held shares in one mining company -- we knew about only one then -- while he was minister of mines and did not disclose that fact to the public, the Clerk or the Premier, as required by the conflict-of-interest guidelines?

Hon. Mr. Peterson: It is quite clear. The facts were laid out by the minister. I recall the sequence of last week. I referred to what I knew, what Mr. Fontaine had told me the day after, and then he made a very clear statement. The facts have all been laid out in this House.

As I understand it, one block of shares has been sold. This contentious block that we are talking about was in escrow, which he acknowledged to this House that he did not declare.

He was under the impression, I understand, that because they were in the hands of a trust company, he had no control over them and did not have legal ownership. I understand the honourable member has a different interpretation of that.

A fair-minded person such as the member would want to acknowledge that it is not as clear-cut as he would want to suggest in the situation. The member is suggesting that presumably he had something to hide. He had no control over those shares, which he acknowledged in this House.

I recognize there can be a difference of opinion, but the member would not want to characterize this as a completely clear issue, because it is not.

Mr. Grossman: In my final supplementary, I do want to clarify this as a very simple, clear, unclouded issue. That issue is very clear and simple. The minister of mines clearly owned the shares, even if he did not have day-to-day control.

If the Premier reads the minister's statement, he cannot and does not deny he owned the shares. We will find out later in the inquiry whether he controlled them. The issue is he owned them. He stood to benefit if those shares went up in value. Even the Premier cannot deny that. He stood to lose if the shares went down in value. That is what ownership is all about.

Given the fact that he has now been over Mr. Fontaine's statement of last Thursday, does the Premier believe Mr. Fontaine complied with the Premier's conflict-of-interest guidelines?

Hon. Mr. Peterson: It is quite clear that the former minister had a legal opinion that those shares could not have been transferred. The member is quite entitled to make the argument that he should have --

Interjections.

Mr. Speaker: Order.

Hon. Mr. Peterson: The member would like a yes or no to the situation, as he always does.

Mr. Grossman: But he owned them.

Hon. Mr. Peterson: Respectfully, it is not quite that clear. He was under the impression that he had no control over them, which he did not. They were in the hands of the trust company. There was nothing he could do with the situation. He believed he was not in a conflict, and I gather he had legal advice to that end. That was the opinion under which he was operating.

Mr. Davis: What do you believe?

Hon. Mr. Peterson: I do not know all the answers to this situation; I say that fairly. It is sufficiently grey. The House leader has referred this to a committee of the House and the Leader of the Opposition can draw his own conclusions on that matter.

If he is suggesting there is any personal benefit, I know of none. If he is suggesting there is some way he has made money out of this situation, I know of none. The honourable member may know of some. The member's detectives may know of some way he has done it. Please bring forward the information.

If the member says the minister made a technical error in not writing those down, he can legitimately make that argument, but it is a matter of interpretation. The minister understood there was no clarity on this matter. It was not an absolute black-and-white issue.

He did what I believe is the honourable thing; he resigned and made a judgement that the member is very quick and hastens to make an issue, because the member would like to hang him out if he possibly can. I understand where the Leader of the Opposition is coming from on this matter.

The minister said that technically he should have complied. There were legal arguments why he did not do so. Then he said, "Put the case to the people of Cochrane North." That was the decision he made.

Mr. Grossman: The Premier clearly has the lowest guidelines and lowest standards of conflict for his ministers of any premier in the country, bar none.

EXTRA BILLING

Mr. Grossman: My second question is for the Premier as well, with regard to one of his other difficulties and concerns.

The Premier may recall that recently it was reported that Ontario had lost two of its top spinal surgeons to the United States because of the Premier's plan to ban extra billing. At the time, the Premier said he did not see any trend and was not too concerned.

2:50 p.m.

In the fourth week of the strike, we have now learned that a third world-class -- to use the expression of the Premier -- orthopaedic surgeon from the Hospital for Sick Children, Dr. Colin Moseley, has also indicated his intention to leave. There are seven on the team. Three have left in the past nine months, including Dr. Moseley. Two had been there for 16 years.

Does the Premier still contend that there is no trend and that specialists will not leave this province?

Hon. Mr. Peterson: I was not aware of the specific example the member has just raised, but I would not think that, out of 17,000 doctors, three is indicative of a trend.

Mr. Grossman: I want to ask the Premier to speak seriously for a moment. When children in this province who are suffering from spinal deformities that have been getting until now world-scale treatment from these very doctors at Sick Children's Hospital, how is he going to assess when this becomes a trend? Is he not worried? Will he not at least agree today to express his concern and say he is worried that these top-notch surgeons are no longer going to be available at Sick Children's Hospital as a result of Bill 94?

Hon. Mr. Peterson: I do not know the specific circumstances of the three doctors whom the member has pointed out. Other doctors have left this province, as he well knows, over the past several years. At the same time, a large number are coming here. I understand there are lineups of doctors from outside this country and this jurisdiction who are anxious to become licensed in Ontario.

Mr. Foulds: They cannot get internships.

Hon. Mr. Peterson: I can tell my honourable friend that we will license, I believe, something like 1,400 doctors this year in Ontario. Of these, 600 or so are products of medical schools in Ontario, about a quarter are from outside Ontario, in Canada, and the others are from around the world.

I am not happy when doctors choose to leave, but it is a free country and they are entitled to do that. It is one of the freedoms they want, obviously, and if they make those decisions they are entitled to do so.

Mr. Grossman: Surely even the Premier will have to agree and acknowledge that one does not get surgeons of the calibre we are talking about here the day they are licensed. It takes five to 10 years until they develop the kind of expertise that has attracted patients from all over the world to come to Sick Children's Hospital to get that sort of care and attention.

Since up until now children in Ontario have had their spinal deformities dealt with and resolved at the Sick Children's Hospital, and since in the future they will not be able to get much of that surgery at the Sick Children's Hospital in Toronto, is the Premier prepared to make a commitment to pay not part but rather all of the costs of travel and surgery in Los Angeles, where Dr. Moseley is currently moving, for the children in Ontario who will not be able to get it here?

Hon. Mr. Peterson: I guess the honourable member is trying to suggest that all of these doctors are motivated just by money, and I do not believe that that is the case. One of the problems, as my honourable friend will know, is that extra billing does not acknowledge the special expertise he is talking about. One does not have to have a special seniority, special competence or special merit to extra bill. Anyone can extra bill under the system, and I frankly believe it is one of the deficiencies in the system.

When we discussed the matter with the Ontario Medical Association, we recognized that there were certain special circumstances where doctors of special merit might deserve a special compensation. We are prepared to sit down and talk about exactly that situation with the OMA, but the Leader of the Opposition's approach of keeping extra billing does not address the problems he has talked about.

ALLEGED CONFLICT OF INTEREST

Mr. Rae: I have a question for the Premier about Mr. Fontaine. Mr. Fontaine says on page 3 of this statement, "I forgot to list the escrow shares." Is it the Premier's view that he should have remembered to list the escrow shares?

Hon. Mr. Peterson: There is no question I would have preferred that he had listed those escrow shares. However, the member opposite heard the honourable member's explanation. What he said was that he had had legal advice on that matter, to which I was not privy at the time. Surely the member can understand that.

Mr. Rae: How can one have legal advice about whether one should forget or remember something? I do not know what lawyer can give one advice on how to remember or forget something. Either Mr. Fontaine forgot or he took legal advice. The Premier cannot have it both ways. He said he forgot and the Premier is saying he took legal advice. We are entitled to know which it is.

Mr. Speaker: What is your question?

Mr. Rae: On page 7 of his statement, the minister said: "I am owed approximately $13,000 by Evolution Hearst. I am also owed approximately $50,000 by United Sawmill and René Fontaine Holdings Ltd." Is it the Premier's view he should have disclosed those two debt interests?

Non. Mr. Peterson: I am not sure of the answer to that situation. I have the fairly simple view that everything we do should be open to public scrutiny. Everything we do has to be open. It will have to bear up to the judgements other people want to apply to it, whether it is the member for York South (Mr. Rae), the Leader of the Opposition (Mr. Grossman) or others. I have suggested to all my colleagues that the facts must stand by themselves.

Various people will draw various interpretations as to why it was done or will attribute special motives to it in the situation. Obviously, I prefer all these things to be laid out. My former colleague gave an explanation of this. I remind the member that he will have the opportunity to go into these questions at a committee hearing -- it has been referred by the House leader -- and to put forward any view he has on the situation.

Mr. Rae: The person of whom I want to ask questions about the resignation of Mr. Fontaine has not resigned. He is the Premier of the province. I have very direct questions for him. Since the Premier is not at all clear as to the meaning of any of the guidelines, can he tell us why he accepted Mr. Fontaine's resignation on Thursday?

Hon. Mr. Peterson: The member may or may not know that when someone resigns, one does not have the power to accept or not to accept it. That is the reality of the situation.

Let me explain Mr. Fontaine to the member. The member knows he is a man of great conscience. He felt very clearly in his own mind and heart that he had not violated any of the conflict-of-interest guidelines. That was his view of the situation. He had also gone through some attacks in this House from the members opposite and he felt his honour was at stake.

The member is asking me to cast myself in the role of judge and jury on all these matters, on all these very difficult questions. Mr. Fontaine did the honourable thing, which I think the member has to acknowledge. He resigned from this House and from the executive council to put his case before the people. If the member has a different view, he should go to Cochrane North and express how he sees the situation.

Interjections.

Mr. Speaker: Order. I will just wait.

Mr. Rae: There is no dispute with the people of Cochrane North. The issue is for the Premier, not for the people of Cochrane North. That is where the buck stops and that is where the issue lands. I know the Premier is now getting advice from three different people, from all his advisers.

Mr. Speaker: Question.

Mr. Rae: Can the Premier confirm that the witness to Mr. Fontaine's resignation is the Premier's secretary? Can he tell us what discussions he had with Mr. Fontaine last Tuesday, Wednesday and Thursday and precisely what his advice to Mr. Fontaine was during all those proceedings?

Hon. Mr. Peterson: After the discussion in this House, Mr. Fontaine reviewed his entire situation, which he shared with the members of the House. I am told he had been discussing it with his son; I believe it was on Wednesday. Obviously, he was very troubled by the situation and the allegations that had been made. The son suggested to his father that he should resign in the situation. That is where the idea came from.

When Mr. Fontaine suggested that to me, I said, "If you feel that is the honourable course in the circumstances, you will have to follow your own conscience in the matter." In his own mind, he decided to let the people of Cochrane North make the judgement on this matter. I know the member would prefer to make the judgement on this matter, as would others in this situation, but ultimately it is the will of the people of this province that predominates. Even the member has to respect that.

3 p.m.

Mr. Rae: That is the phoniest excuse I have ever heard in this House with respect to anything. It is so phoney. Can the Premier explain who in this House ever for a moment challenged the right of the then member for Cochrane North to sit as a member of this assembly? Nobody did that; not a soul did that.

Can the Premier explain how calling a by-election has anything to do with changing the guidelines or what the guidelines are? Is the Premier seriously suggesting that if Mr. Fontaine is elected as the member for Cochrane North, it will somehow give him immediate and automatic access to the cabinet when he has already admitted he broke the guidelines? Can the Premier explain the connection between those two things? What is the connection?

Hon. Mr. Peterson: This matter will be discussed by a committee of the Legislature, and the member is going to have his opportunity to put this thing forward. He obviously feels his judgement on this matter is superior to anyone else's, and he would like to attack my judgement on the matter.

Mr. Martel: You are the Premier. What is your judgement?

Mr. Speaker: Order.

Hon. Mr. Peterson: I think a fair-minded gentleman such as the member would like to acknowledge that the facts may not be as completely black and white as he sees them.

The former member for Cochrane North felt his honour was under attack, whether the member for York South knows it or not. That is the way he responded to this situation. He felt the member for Sarnia (Mr. Brandt) was attacking his personal integrity. He obviously felt it was intact, and he took what he felt was the honourable course in the circumstances. Surely the member understands that.

Mr. Rae: The Premier has made a very long statement today in which he has not at any point indicated what his responsibilities are with respect to the guidelines. Can the Premier tell us his view of his role with respect to the guidelines?

What difference does it make what guidelines exist if the Premier is not prepared to do what is necessary to see that those guidelines are enforced? What good are any guidelines if the Premier at every occasion is simply going to wash his hands and say, "It is not up to me; it is up to the people of any given constituency to decide"?

What role does the Premier see for himself in terms of what has happened to Mr. Fontaine, the orchestration of the by-election which has taken place and his continued evasion of his responsibilities as Premier with respect to conflict of interest?

Hon. Mr. Peterson: I am not sure why my honourable friend is so fearful of the judgement of the people of this province on this matter or any other. That is what democracy is all about. The former member for Cochrane North had legal advice on a number of matters. He has resigned. He has turned the matter over to a committee of this House.

The member for York South is entitled to make his own judgement; if he sees it all so simply, he should come and express his point of view. He would set himself up above the people of this province, and I would never do that. My friend the former member for Cochrane North has acknowledged the ultimate expression of democracy. Why does the member not go to the people and make the case he wants to make?

He sees it all so clearly, but when he looks at all the circumstances and all the advice the honourable minister got, he will realize why we have to look at this situation in all of its ramifications. He thinks this matter is all so very clear. If he is ever charged with responsibility, he will know that in these matters it is not. These are not black-and-white situations. The member would want to participate --

Mr. Martel: You ignored your responsibility.

Interjections.

Mr. Speaker: Order.

Mr. Brandt: The Premier for once is half right. The honourable thing for the minister to do was to resign, which he did. The dishonourable thing for the minister to do was to resign his seat, which was never at question in this House by myself or any other member of this assembly.

Is the Premier aware that a reporter had a conversation with the president of Golden Tiger? During the course of that conversation, it apparently came to pass that certain questions were raised, one of which was mining taxation for this province. The level of value of the shares and a whole series of things were discussed between the then minister and the president of Golden Tiger.

Does the Premier think that while a minister holds the portfolio for mines it is appropriate for him to have such a conversation with the president of that company?

Hon. Mr. Peterson: My honourable friend from Sarnia wants him to resign but not to resign. He wants him to resign from the cabinet but not to resign his seat. This has been put to the ultimate test, and my honourable friend is hoist with his own petard.

Mr. Harris: We want to know what you think.

Interjections.

Mr. Speaker: Order.

Hon. Mr. Peterson: I am aware of that press report, as is the member. He will have an opportunity to call whomever he wants to call in front of a committee of this House, including whomever discussed what with whom, and to ask those questions. Then he can put his own view in this matter.

I have no idea what those private conversations were. The member has suggested they talked about the Mining Tax Act; that has been a matter of public knowledge for a long time around here. I am sure the former Minister of Northern Development and Mines used to talk to a lot of miners about the situation.

If the member is suggesting that there was any special influence or that Golden Tiger got any special consideration, that is a very serious allegation. If he or his detectives can establish that, I invite him to do that in front of the committee or in this House.

Mr. Brandt: The Premier is very quickly taking this issue from the Minister of Northern Development and Mines and making it his own, because it is his judgement that is in question. The fact that the shares were in escrow as opposed to being in a blind trust is not at issue. The fact is, the minister did not disclose his holdings in a mining company while he held the responsibility of looking after mining interests in this province.

Why does the Premier not stand up and very clearly indicate to this House that his minister was in violation of the guidelines as they have been in this province for a good number of years and that the proper course of action was simply for the minister to stand down in his responsibilities as minister, and not try to cloud the issue by talking about the minister's personal position as the member for Cochrane North?

Hon. Mr. Peterson: My honourable friend would like it all ways. He loves to stand up and impugn the integrity of a member.

Mr. Brandt: No. I want it one way.

An hon. member: Yes; your way.

Interjections.

Mr. Speaker: Order.

Hon. Mr. Peterson: He would like to stand up, with the help of his detectives, and cast aspersions on the honourable member and/or myself and my judgement. But he does not want to go to the people on these issues. He wants to avoid the ultimate responsibility on these matters.

Hon. Mr. Bradley: How many more private detectives are you going to hire over there?

Mr. Speaker: Order.

Hon. Mr. Peterson: My friend cannot have it both ways. If he is going to use his detectives and investigators to cast aspersions in this House, then he has to accept the consequences, which are that the people will decide, either in Cochrane North or right across the province.

Mr. Brandt: That is not the point. No one is going to ask the people of Sarnia.

Hon. Mr. Peterson: Why does the member not put his seat on the line?

Mr. Mancini: Put your seat on the line, Andy.

Hon. Mr. Scott: Ask a doctors' question; they are in the gallery.

Interjections.

Mr. Speaker: Order. There are other members who want to ask questions.

Mr. Rae: I have a question again for the Premier. By the same logic, can he tell us why the member for Oriole (Ms. Caplan) did not resign her seat and why the people of Oriole are not being consulted with respect to the allegations of conflict of interest? Which is right? Was the approach taken by the member for Cochrane North right? Should every cabinet minister against whom there are allegations with respect to a conflict of interest simply resign his or her seat? Does that somehow absolve the government of any problem? Is that the Premier's answer?

Hon. Mr. Peterson: First, it was a very personal decision that the honourable member made. The leader of the third party has some other impression, but that decision was made.

Let us go through the history of this situation. Members may recall there were suggestions of influence peddling with respect to the spouse of the former minister. That was quickly dropped, with a suggestion there was some violation of the conflict-of-interest guidelines. That was a question of a spouse, not of a member of this House. That matter was put immediately before the standing committee on public accounts.

There was a suggestion that the then Minister of Northern Development and Mines had himself violated the conflict-of-interest guidelines. He felt his honour was under attack, and he made the decision to resign. It is that simple.

3:10 p.m.

Mr. Rae: Can the Premier tell us what is his responsibility as the Premier, as the person who appoints cabinet ministers? Can he explain the statement he has made twice now -- I gather he made it on Thursday, and he made it again today -- stating categorically that if Mr. Fontaine were elected in the by-election in Cochrane North, he would automatically come back into the cabinet? Can he explain the logic that says somebody who is elected in a by-election automatically has access again to the cabinet right away, no matter what the violation has been of the conflict-of-interest guidelines? Can the Premier explain the logic of that view he holds? It does not seem to make any sense to anybody else.

Hon. Mr. Peterson: It makes great sense to me. The member for York South may feel his personal judgement, or the judgement of some members of his party, is superior to that of the people in Cochrane North. I do not accept that view. Ultimately, we are all accountable in that forum.

I believe my responsibility is to share all the facts in all these matters with the member for York South and all other members of the House. That has been done to the best of our ability: to invite scrutiny by the member, by anyone else, of all these facts. I accept that the member and I may differ in our interpretation of some of these matters, particularly the ones that are not clear, but ultimately all these matters will be judged by the people of this province.

I can see now what the member will say and what my friends opposite may say in this matter. Members may feel the appropriate forum to deal with these matters is a committee of this House. I think it has been dealt with in an extremely honourable way, but the member will not accept that; he will continue to stand up and make speeches. I think both ministers dealt with these questions in very honourable ways and shared all the information with the members. I do not know what more could be asked.

Mr. Pope: There is only one more thing we can ask the Premier. Last week, the Premier had to make a judgement. He referred to it today. Did the former member for Cochrane North breach the conflict-of-interest guidelines or not?

Hon. Mr. Peterson: I say to the member for Cochrane South, very frankly, he does not believe --

Interjections.

Hon. Mr. Peterson: I say it is sufficiently grey. I can see both sides of the issue very strongly. I do not think there was any personal benefit in the situation. He believed they were in escrow; he had no control over the situation. For that reason, and given the fact that his honour was under attack, he did what he did. He will let the people of Cochrane North judge that matter.

Mr. Pope: There is one more thing we are entitled to know. Last week, the Premier had to make a judgement. He has referred to it in the Legislature. Did the former member for Cochrane North breach the conflict-of-interest guidelines or not?

Hon. Mr. Peterson: I think I acknowledged last week there may have been a technical violation, and I think --

Interjection.

Hon. Mr. Peterson: That is fair enough. There may have been a technical violation in that matter, and I will acknowledge that. I said that last week. I have also said that ultimately the people of Cochrane North will have to judge on this matter: was it is a technical violation or a substantive violation?

Is the member arguing that because he did not write that down he is in conflict of interest and therefore has to resign? Is the member arguing that he benefited personally? What is the member arguing in this matter? Is the member saying the former member should be punished because he forgot to write that matter down? Let us focus on the issue. I said to the members last week that I believed he should have written it down. I wish he had. Is that grounds to have him removed from the cabinet? He made the determination that the matter should be judged by the people of Cochrane North.

RENT REVIEW

Mr. Reville: I have a question for the Minister of Housing. The tenants of Ontario need to know what Bill 51 means so they can plan their lives. Unfortunately, last Thursday the minister said that when it is passed we will be able to determine the rate by which rent will be increased in January 1987. That surely is like renting an apartment and then asking what the rent is going to be.

Will the minister confirm today that if Bill 51 is passed as it is, the $500 rent I spoke of last week will increase, not by four per cent, which is $20 a month, but by $26 or $36 or $51 or $78 a month, depending on which bonus he is giving to the landlords of Ontario?

Hon. Mr. Curling: The member indicated the $500 rent. Again, let us assume he would say that $500 rent would fall into a pre-1976 building, because it all depends on which building this $500 unit is attached to. If it fell under the post-1975 building, it would have been increased by four per cent retroactive from August 1, 1985.

If the member had said anything about what the rate would be for 1987, the guideline that is being proposed in Bill 51 has indicated that should the inflation rate be maintained at the same level, it is possible the guideline would be in the region of 5.1 per cent. As I said previously to the member, I do not have a crystal ball to know exactly what the inflation rate will be then. What we are saying is that in passing Bill 51, and if the inflation rate is maintained, the guideline for that specific unit will be increased by 5.1 per cent.

Mr. Reville: I think the answer to my question was yes, but I am not sure.

Mr. Speaker: Try a supplementary.

Mr. Reville: The minister's bill talks about a guideline with which we have played around, and it is called the residential complex cost index. He said that might be about 5.1 per cent. His bill requires that guideline to be known in August of the year preceding the year in which it will be applied. The minister must know today what the guideline will be for January 1, 1987. If he does not, will he not agree today to withdraw all this RCCI and building operating cost index and bring in a four per cent increase that everybody can understand?

Hon. Mr. Curling: The member said he wanted a precise answer. I would say precisely it is July 2, 1985, and not August.

Mr. Wildman: It is 1986.

Hon. Mr. Curling: I am sorry; 1986. That is the first correct interjection I have heard from the members opposite.

The four per cent the member keeps harping on is that in the past when there were rent review guidelines, they had no relevance to what the real increases were. The guidelines that will be in place are very relevant to the operating costs of how landlords operate their businesses. It has much more significance to rental units.

TRANSMISSION LINE

Mr. South: I have a question of the Minister of Energy. Now that the Kingston-to-Ottawa transmission line is proceeding, can he indicate whether local workers will be given an opportunity to participate in this Ontario Hydro project?

Hon. Mr. Kerrio: The eastern transmission line is in the very early stages of construction, and the clearing is getting under way. It is my impression, in talking with Ontario Hydro, that preference will be given to those people who register through the union halls in that area. I believe that is going to happen in the immediate future.

3:20 p.m.

ALLEGED CONFLICT OF INTEREST

Mr. Pope: I have a question to the Premier, and we are entitled to an answer. The Premier had to make a decision last week. Did the former member for Cochrane North breach the conflict-of-interest guidelines?

Hon. Mr. Peterson: I told the honourable member I think there was a technical violation. I said that three or four days ago.

Mr. Pope: In the light of the Premier's comments concerning the events following August 14, would the Premier have reappointed the former member for Cochrane North to the cabinet if he had not resigned his seat?

Hon. Mr. Peterson: I do not follow the member's question exactly. The honourable member resigned his portfolio and then, as a matter of honour, went on and resigned his seat. He felt that was the appropriate thing to do in the circumstances.

One can make the case that there was a technical violation. If the member is asking me whether Mr. Fontaine benefited from it, the answer is no. If the member is asking whether in any way Mr. Fontaine got a benefit that was untoward or put his personal interest ahead of his public interest and his public duties, in my opinion, the answer is no. The member asked me, and I am telling him.

RENTAL HOUSING PROTECTION LEGISLATION

Ms. Gigantes: My question is to the Minister of Housing. The minister is well aware of the situation at the Bonaventure Apartments, 180 MacLaren Street, in the riding of Ottawa Centre.

When the minister tabled legislation to control the loss of affordable rental housing in Bill 11 on May 5, 1986, those tenants had great hopes, but on June 3, the owner of 180 Maclaren Street received a building permit from the city to convert many of the 90 units to apartment-hotel units, for which he calculates he might receive up to $1,200 a month in rent.

Will the minister make the provisions of Bill 11 retroactive to May 5, so the many tenants who counted on this bill to protect their tenancies will not be evicted and lose their homes?

Hon. Mr. Curling: The honourable member raised that question before. Bill 11 is before the House today for second reading. It is not my intention to make the bill retroactive.

Ms. Gigantes: Does the minister realize he has declared open season on tenants between May 5 and June 3 in the case of the Bonaventure and between May 5 and whenever the bill is assented to in the case of all other tenants?

Hon. Mr. Curling: The member is very concerned, and I know she is a very good member for her riding. I will ask her to proceed very quickly to support Bill 11 so we will have none of these incidents happening again in the future.

STABILIZATION PAYMENTS

Mr. McKessock: I have a question for the Minister of Agriculture and Food. The deadline for applications for the red meat stabilization program was the end of June 1986. Can the minister inform me what the response was to the beef, hog and sheep programs? Also, can he inform me whether he intends to add to this list a program for backgrounder or feeder cattle some time in the near future?

Hon. Mr. Riddell: I thank the member very much for the question.

Mr. Davis: I bet you have an answer too, Jack. I bet you have it right at the tip of your fingers.

Interjections.

Mr. Speaker: Order. You may make the minister strain his voice.

Hon. Mr. Riddell: When an industry that is so important to Ontario is struggling as agriculture is at present, it is a shame the opposition parties spend so much of their time trying to discredit members of this House rather than putting some importance on the agricultural industry. I am pleased to get that kind of question from my colleague.

Interjections.

Mr. Speaker: Order.

Hon. Mr. Riddell: The latest figure I was given was that we had around 5,000 applications for the program mentioned by the honourable member. The deadline was the end of June. I will report to the member -- I hope to get the latest figure today -- how many applications we received by the end of June, which was the deadline.

Mr. McKessock: The other part to that question was, is there going to be a program for backgrounder cattle some time in the future?

Mr. Speaker: That was a good supplementary.

Mr. McKessock: Relating to that, there is a considerable penalty for anybody who misses that deadline of June 30. is the minister going to give some consideration to extending that deadline?

Hon. Mr. Riddell: Once again, we will have to see how many applications were received by the end of June. We will then make a decision about whether we are prepared to extend the deadline. We realize we were a little slow in getting some of the application forms out. The farmers got busy seeding and therefore did not have the time to sit down to fill out the application forms. These are all matters we will take into consideration. There is a possibility we could extend the deadline, but it will depend on how many applicants were able to submit their applications by that deadline.

As far as the backgrounder program is concerned, the committee is currently striving for a backgrounder program, but we cannot get the cattlemen across the country in particular to agree about what type of program we should put in place. I understand the committee is getting very close to reaching some agreement. I hope we will have a backgrounder program in place by next year.

COMPUTER CONTRACTS

Mr. Gillies: My question is to the Premier. The Minister of Education (Mr. Conway) has indicated to me by letter that Abe Schwartz has acted on his behalf in the ministry as an adviser on computer matters since September 1985 and continues to do so even to this day. Does the Premier not think it a possibly troublesome situation that those companies going before the Ministry of Education for contracts are the selfsame companies that are being solicited by Mr. Schwartz to participate in his Exploracom project? Does the Premier not see that as potentially troublesome, if not a situation of conflict?

Hon. Mr. Peterson: The answer is no, I do not see anything the honourable member has raised as being troublesome. If he has some specific suggestions of specifics that are troublesome or of undue influence being used, I would appreciate his sharing the information with me.

Mr. Gillies: The problem we have is that the Premier refuses to bring the list of computer contracts before us until October, but the minister was kind enough at least to give us the software contracts his ministry has awarded. We find that the largest software contract given out by the Ministry of Education in the past year did go to one of the six companies that is participating in Exploracom. There are more than 1,000 computer companies in Ontario. Does the Premier not agree that this looks very strange and that he could clear up this situation by bringing forward all the contracts so members of the House could peruse them?

3:30 p.m.

Hon. Mr. Peterson: This is absolutely typical. I say to the member no, it does not look strange to me at all. If the members opposite with their detectives have information that there has been some untoward influence, then I ask them to please bring it up. The members opposite have been sniffing around Exploracom like a puppy in heat for the past several months. They have sniffed around and made no serious allegations. They think there is something there. The members do not have anything.

If the member for Brantford has some information, let him stand up and share it with us. What he has presented in this House is remote, in my opinion, from any influence being used; yet he continues to stand up in this House and to suggest, drawing things together that are absolutely unrelated, that somebody is profiting.

Mr. Harris: The Premier has had five weeks to share the information. How long does it take him to doctor it up the way he wants to doctor it up?

Hon. Mr. Peterson: I do not think there is anything strange about it at all.

GASOLINE PRICES

Mr. Morin-Strom: I have a question for the Minister of Energy in regard to the gasoline price forums that were held across northern Ontario in the past couple of weeks. These forums were completely unadvertised in Sault Ste. Marie. I do not know about other communities.

In the Sault, the minister's representative, a senior adviser with the Ontario Ministry of Energy, stated there was the possibility of collusion among Sault dealers and that this could be a factor in the high gasoline prices and lack of competition. However, the dealers in Sault Ste. Marie have contradicted that and have said, as quoted in the Sault Star: "Gas prices are set by the oil companies in Toronto. Dealers in Sault Ste. Marie, no matter whom they work for, have no control over the price."

Will the minister tell us whether he and his ministry have been able to determine whether the collusion is among the dealers in northern Ontario or whether it is going on within the head offices of the oil companies in Toronto? Will he enforce some regulation on gas prices to see that we have some equitable prices in gasoline in the province?

Hon. Mr. Kerrio: When such questions are raised, of course, I am not able to give an answer as to whether there has been collusion among the retailers or the major oil companies. I will take that question under advisement and get back to the honourable member.

Mr. Morin-Strom: This is an issue that supposedly is being addressed by this ministry. Apparently, it has been doing studies on this issue for nearly a year to this point. The ministry has gone to the public to get input. His own ministry representative has said there is possibility of collusion among the dealers. The dealers are telling us that the prices are being set by the companies in Toronto.

What is the minister going to do to ensure that there is regulation of prices of gasoline in this province and that people have fair and equitable prices in northern Ontario?

Mr. Speaker: Order. The question has been asked.

Hon. Mr. Kerrio: The very question about major dealers was aired in a federal forum and it was found there had not been at that level. I am not prepared to say this with the question the member is raising. However, he has to accept the fact that those kinds of allegations are going to require some investigating and that in proper time I will return with an answer to him.

Certainly, we are concerned about the prices of gasoline in northern Ontario and we are addressing ourselves to the question in a major way.

LANDFILL SITE

Mr. Callahan: I have a question for the Minister of the Environment. In my community right now, an investigation is going on for a new landfill site. What triggers the environmental assessment hearing? What will be the effect if one of the sites that has been reviewed has not had testings on it?

Hon. Mr. Bradley: The question, as I heard it, related to what, in terms of the new greenfield landfill site, would trigger environmental assessment. As some members of the House who have been here for many years know, what happens now is that a greenfield site, as it is called -- this is a new landfill site anywhere in Ontario that is being proposed by a municipality -- comes under environmental assessment.

First, the municipality must undertake an exhaustive review of all the options available. Many of those options are various sites within that municipality. Once it has done that and has come forward with the proposal, that then goes before the Environmental Assessment Board for a final decision.

Mr. Callahan: If a site initially has been chosen and rejected, but no drilling has been done on the site, what would be the impact or effect of an environmental assessment hearing that was called in terms of that site?

Interjections.

Mr. Speaker: Order.

Hon. Mr. Bradley: I am sorry members of the official opposition party do not consider these matters to be of sufficient importance to listen carefully to what is obviously a very good question by the member.

Unlike the Environmental Protection Act, which deals with a specific site, when a landfill site comes under environmental assessment, the Environmental Assessment Act means that those putting forward a proposal must provide alternative proposals in terms of other sites or other methods of disposing of the garbage. I know there is criticism that it is an onerous task and sometimes incurs additional costs. We believe that going through this process will in the long run provide a more environmentally sound site than not having the process.

ALLEGED CONFLICT OF INTEREST

Mr. Brandt: I have a question for the Premier. The Premier has indicated that the Minister of Northern Development and Mines resigned as a matter of honour. I would like to ask the Premier a simple and direct question. Had the minister not resigned, would the Premier have allowed him to remain in cabinet?

Hon. Mr. Peterson: I am not going to get all hypothetical about this or any other situation. I did not get hypothetical about the doctors' situation, when I was asked hypothetical questions every day.

Mr. Sheppard: He did not ask about the doctors.

Hon. Mr. Peterson: We had an insight over there. I was just trying to make an analogy. I know they are not easy to make. I have said there was a technical violation. He resigned from this House and from his seat. That is where the situation is at the moment; it is very clear.

Mr. Harris: The rest of the ministers need to know what the Premier's standards are, if any.

Mr. Speaker: I inform the member for Nipissing (Mr. Harris) that his colleague wants to ask a supplementary.

Mr. Brandt: The Premier indicated that this was a matter of technical interpretation, that the guidelines perhaps were not sufficiently clear or there was some fogginess with respect to how one might interpret the guidelines as they relate to this specific issue. As I understand this case, and I am getting to the question as quickly as I can, there is a requirement in the guidelines, which is reasonably well understood in this House, that one must disclose holdings.

By admission of the former minister himself, he did not concur with or agree to what those guidelines required of him, namely, to comply by way of disclosure. Since the issue is that the minister did not disclose his holdings, would the Premier have allowed him to remain in cabinet under those circumstances had he not resigned?

Hon. Mr. Peterson: The facts have been laid out very clearly in the circumstances. I wish he had made the judgement to share that information with everybody. If the member is suggesting there was some untoward gain for him personally as a result of this, I do not believe there was. He failed to list that because he did not feel he had to list it, because it was not sufficiently clear. It is not a clear-cut question of directly owning X number of shares in a mine or Massey-Ferguson or anything else. They were in escrow. He had no control in the situation and he got advice to that effect.

The member sees it in black-and-white terms. I suggest that other people, including those who gave him the legal advice he got, do not see it in the same terms he does.

Mr. Wiseman: What about the Premier?

Mr. Davis: How does the Premier see it.

3:40 p.m.

Hon. Mr. Peterson: I told the members how I see it; I think he violated the rules technically in that regard. If the member is asking me whether there was a substantive breach, the answer is no. In making a judgement on this matter, I assume the member is asking that he be thrown out of cabinet for the rest of his life. Is that what the member is asking? He said he took it as a matter of personal honour and resigned his seat. That is where the situation is. Surely the answer to that is very clear to my honourable friend.

OCCUPATIONAL HEALTH AND SAFETY

Mr. McClellan: I have a question for the Minister of Labour. In January 1982, Dr. Annalee Yassi of the occupational health centre of the Manitoba Federation of Labour completed a study commissioned by Paul Weiler. It was a study of how occupational health and safety claims are handled by the Ontario Workers' Compensation Board. Can the minister explain why he has failed to reply to her letter of July 1985, in which she asked him to reverse the decision of the previous government, which had been to suppress this important study.

Hon. Mr. Wrye: It probably will not come as a surprise to the honourable member that I do not recall receiving a letter which, according to the member, l would have received about a year ago. It is certainly unlikely that I would not have replied to it. I am rather surprised that when no reply was received, there was not some followup. I will certainly undertake to the member and to the House to check into this matter. I will speak to the member privately. If we cannot locate the correspondence, I will obtain Dr. Yassi's telephone number and get in touch with her immediately.

Mr. McClellan: I appreciate that. The study is entitled Occupational Diseases and the Workers' Compensation Board in Ontario. The initial decision to suppress the document was communicated by Alan Wolfson in 1985. He is now reincarnated as one of the major saviours of the Workers' Compensation Board. I would like an assurance from the minister, not only that he will try to find the correspondence and retrieve it from the swamp, but also that he will reverse the policy of suppressing this important study, because the minister knows how badly the Workers' Compensation Board has handled health and safety claims over the last two decades, and release the report.

Hon. Mr. Wrye: My friend from Bellwoods slips into the unfortunate rhetoric of his colleague the member for Sudbury East (Mr. Martel). Part of the problem is solved by the fact that my friend from Sudbury East sends so many letters that he loses track, and then thinks of the ones he thinks he sent and did not get replies to, he thinks they were not replied to. I have indicated to the honourable member that I will look into the situation fully. It is not my view that we should withhold any matters or any studies without very good reason.

I make a commitment to the member and to the House that we will take a close look at the reason any study would be witheld. As the member knows, in an earlier situation, with Dr. Muller's study, we not only indicated that we would give out the preliminary study, but also the final study.

ROMAN CATHOLIC SECONDARY SCHOOLS

Mr. Davis: I have a question for the Minister of Education. In a recent article, Blenus Wright, assistant deputy minister with the Ministry of the Attorney General, has stated that prayers from a variety of religious traditions in public schools clearly enhance multiculturalism. It is apparent that it is the government's direction to follow using a variety of opening exercises. In the minister's view, would this policy and direction be required of the separate school boards in this province as well?

Hon. Mr. Conway: The honourable member is quite aware of what the regulations under the Education Act provide. He will also be aware that various aspects of those regulations are now before the courts, two or three references in the province at present. He will also be aware, from his stellar performance through many months during the handling of Bill 30 by the standing committee on social development, of the practices within the separate school community.

PETITIONS

EXTRA BILLING

Mr. Hennessy: I have a petition from the Patients for Freedom in Medicine, a citizens' association founded on the principle of civil liberties, which reads as follows:

"This association believes that Bill 94, the Health Care Accessibility Act, is a violation of both patients' and physicians' civil liberties. If Bill 94 becomes law, doctors will be totally controlled by the government and health care will be totally controlled by the government. This association believes medical care should be based on medical need, not determined by government budgets.

"As a citizen of Ontario, I do not agree with this legislation and request that Bill 94 be withdrawn."

That is signed by 50 people.

Mr. Speaker: Once again, there are many unnecessary conversations.

SALE OF BEER AND WINE

Mr. Epp: I have a petition signed by 111 people. It says:

"We, the undersigned, wish to express our objection to you as our elected representative to any legislation which would exclude us in our place of employment from the opportunity to sell our customers any product simply because we are not so-called independent stores."

They are referring to wine and beer in Ontario grocery stores and they have a number of other points. They go on to say:

"This practice would discriminate against our customers, who choose to shop here of their free choice for reasons we believe we have contributed to.

"This practice would discriminate against us by encouraging our customers to shop elsewhere. We believe we work hard and conscientiously for our customers and intend to do so for beer and wine as well as for any other products we sell, including any strictly regulated products.

"Fourth, we object to any government action which jeopardizes our jobs and earnings by manipulating free consumer choice."

EXTRA BILLING

Mr. Barlow: I have a petition signed by 30 residents of Cambridge, which reads as follows:

"To the Honourable the Lieutenant Governor and the Legislative Assembly of Ontario:

"The doctors' dispute with the Ontario government is about the following: the freedom to practise medicine without government interference, the freedom to protect patients from government interference in health care and the freedom from government conscription.

"We, the undersigned, would like to support our doctors in protesting Bill 94."

Mr. Jackson: I have several hundred signatures on a petition, which reads as follows:

"To the Honourable the Lieutenant Governor and the Legislative Assembly of Ontario:

"We strongly oppose the unilateral actions of the Liberal government of Ontario, which have created an atmosphere of adversarial confrontation with the health care providers of this province.

"We deplore the disruption of our world-renowned system of private and public health care by the imposition of a state-controlled health care system.

"We, therefore, respectfully petition the government of Ontario to begin immediate and meaningful consultation with the health care providers of this province in a manner that will sustain the quality and excellence of health care for the people of Ontario."

SPECIMEN COLLECTION STATION

Mr. Harris: I have a series of 60 or 70 letters, which I am interpreting as a petition. They read as follows:

"To the Honourable the Lieutenant Governor and the Legislative Assembly of Ontario, with particular reference to the Minister of Health:

"I am an employee of the North Bay Civic Hospital. It is my understanding that new private medical laboratories will be opening up in our city soon. I would like to support the hospital for a specimen collection station. I am a voter and a taxpayer. We are asking for your support to keep the jobs in the north.

"Hoping for your kind consideration,

"Thank you. Yours truly."

I have 60 of these letters which more or less say the same thing. I have been asked to refer them to the Lieutenant Governor in Council.

NATUROPATHY

Mr. McGuigan: I have a petition, which reads as follows:

"To the Lieutenant Governor and the Legislative Assembly of the province of Ontario:

"We, the undersigned, beg leave to petition the parliament of Ontario as follows:

"Whereas it is our constitutional right to have available and to choose the health care system of our preference;

"And whereas naturopathy has had self-governing status in Ontario for more than 42 years;

"We petition the Ontario Legislature to call on the government to introduce legislation that would guarantee naturopaths the right to practise their art and science to the fullest without prejudice or harassment."

3:50 p.m.

REPORT BY COMMITTEE

STANDING COMMITTEE ON REGULATIONS AND PRIVATE BILLS

Mr. Callahan from the standing committee on regulations and private bills presented the following report and moved its adoption:

Your committee begs to report the following bills without amendment:

Bill Pr1, An Act respecting the Ontario Association of Speech-Language Pathologists and Audiologists;

Bill Pr9, An Act respecting the St. Elizabeth Home Society Act;

Bill Pr10, An Act respecting the Empire Life Insurance Company;

Bill Pr16, An Act to revive Alliance Française de Toronto.

Your committee begs to report the following bill, as amended:

Bill Pr17, An Act respecting the City of Cornwall.

Motion agreed to.

MOTIONS

COMMITTEE SITTING

Hon. Mr. Nixon moved that the standing committee on government agencies be authorized to meet following routine proceedings on Thursday, July 3, 1986.

Motion agreed to.

ALLEGED CONFLICT OF INTEREST

Hon. Mr. Nixon moved that the matter of René Fontaine's compliance with the conflict-of-interest guidelines be referred to the standing committee on the Legislative Assembly for review and report to the assembly without delay.

Motion agreed to.

INTRODUCTION OF BILLS

FAMILY LAW AMENDMENT ACT / LOI MODIFIANT LA LOI SUR LE DROIT DE LA FAMILLE

Hon. Mr. Scott moved first reading of Bill 111, An Act to amend the Family Law Act.

L'hon. M. Scott propose la première lecture du projet de loi 111, Loi modifiant la loi de 1986 sur le droit de la famille.

Motion agreed to.

La motion est adoptée.

Hon. Mr. Scott: This bill is introduced to eliminate a short delay that has arisen under the act passed in the early spring in the payment of death benefits to surviving spouses by insurers and pension and other plan administrators. This bill will permit the immediate payment of life insurance and other benefits upon death. It will amend the recently passed Family Law Act to provide that if the surviving spouse elects to receive an equalization or net family property under the act, any death benefits paid to the surviving spouse unofficially are to be credited against the surviving spouse's equalization payment.

In addition, the amended act will provide that if a surviving spouse receives death benefits that are in excess of the equalization payment, the deceased spouse's personal representative may recover the excess amount for the surviving spouse.

In addition, the proposed bill contains a few minor housekeeping amendments with respect to insurance and pension-plan proceeds. The purpose of all these amendments is to clarify the original intention of certain provisions of the act.

It is our hope that the House will be able to give effect to this amending legislation before the House rises, because it will be useful for people who suffer some real distress and real need.

UNIVERSITY OF ST. JEROME'S COLLEGE ACT

Mr. Epp moved first reading of Bill Pr26, An Act respecting the University of St. Jerome's College.

Motion agreed to.

ORDERS OF THE DAY

FOREIGN ARBITRAL AWARDS ACT / LOI DE 1986 SUR LES SENTENCES ARBITRALES ÉTRANGÈRES

Hon. Mr. Scott moved second reading of Bill 98, An Act to Implement the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

L'hon. M. Scott propose la deuxième lecture du projet de loi 98, Loi concernant la mise en oeuvre de la Convention de l'Organisation des Nations Unies pour la reconnaissance et l'exécution des sentences arbitrales étrangères.

Hon. Mr. Scott: Today I have the pleasure of moving second reading of this bill, which will be of benefit to people in Ontario who have any business outside Canada, whether as importers or exporters. The Foreign Arbitral Awards Act, which I am presenting for second reading, will help make the arbitration clauses in international business contracts more effective.

The proposed act will implement in Ontario a United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards, now that Canada has acceded to the convention. The United Nations treaty, known familiarly as the New York convention because it was signed in New York, provides for simple procedures to enforce awards arising from international arbitrations.

Implementing the New York convention will provide a simple and fast way of enforcing foreign arbitral awards in Ontario. Similarly, Ontario businesses will be able to take arbitral awards made here and enforce them in other states that are parties to the convention.

The proposed act will also permit parties to an international arbitration agreement to have an Ontario court suspend a lawsuit brought in breach of an agreement to arbitrate, so that the parties that have agreed to arbitrate will be compelled to go to arbitration.

The federal government has already acceded to the New York convention on Canada's behalf, since all provinces have agreed in principle to pass implementing legislation, and some have already done so.

The convention takes effect 90 days from notice of accession. Our Foreign Arbitral Awards Act, the bill before the House, will not come into force until Canada's accession to the treaty is effective.

In committee of the whole House, I will be making a series of motions to broaden the application of the bill, essentially by removing what is called the reciprocity requirement. Further consultation with our colleagues in other provinces and in the federal government has persuaded me that the trend in Canada and abroad is away from reciprocity in such matters and that the apparent superficial advantages of reciprocity are more theoretical than real or practical.

Mr. O'Connor: Explain them to us.

Hon. Mr. Scott: The jurisdictions in Canada that have passed implementing laws have not required reciprocity, except Saskatchewan, which may propose an amendment. I know of no other that intends to require it.

This is a good opportunity to help bring Canada's international commercial practices in line with that of all its major trading partners. Canadian businesses have said they have lost international contracts because any arbitration award arising out of them could not have been enforced here under the convention. To keep our businesses competitive, they should have the benefit of the convention. By passing this act, we will be doing our part in giving them that benefit.

The member for Oakville (Mr. O'Connor) challenges me to explain the reciprocity provisions, which I will do if requested in committee of the whole House.

Mr. O'Connor: I rise to add some comments to this debate with respect to Bill 98, An Act to Implement the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

I note that this bill is introduced as a reciprocal, complementary bill to an act introduced in the House of Commons on May 7, 1986, to give effect to a United Nations convention in this area.

At the request of the then Minister of Justice for Canada, the Honourable John Crosbie, our House is being asked to pass similar legislation, as are all houses across Canada, in order to implement fully the provisions of this treaty as it relates not only to matters within the jurisdiction of the federal parliament, but also to matters which, under our Constitution, are within the jurisdiction of the provinces. Thus, I rise to support, generally, the provisions of this bill.

4 p.m.

From the remarks of the Attorney General, I note he intends to introduce certain amendments in committee of the whole House, particularly with regard to the necessity or otherwise for making this bill reciprocal with other nations. Within the terms of the bill itself, he was challenged by myself, as he noted, to explain the arguments for and against the necessity for reciprocity terms, and he indicated that he would do so at a later time. However, because he has neglected to do so at this time, I feel it falls to me to delve into this area and to explain fully the rationale both for and against this very interesting, important debate to all the members of this House who are here in their seats in great numbers.

The purpose of Bill 98 is to enable us to implement, as I indicated, the United Nations convention on the recognition and enforcement of foreign arbitral awards. This will facilitate the enforcement in Canada of commercial arbitration awards made in other nations, as is now not the case. The result will be to strengthen the ability of Canadian businesses to request arbitration agreements in their international contracts, which again is not now the case in Canada. That is, Canada may be subject to foreign arbitral awards made in other nations by tribunals conducted in other nations; however, we do not have similar provisions here in Canada to assist our businesses trading internationally.

The substance of the bill is that its effect will be to adopt the New York convention, as I have indicated. It is approved and declared to have the force of law in Canada during such period as, by its terms, the convention is in force. The act further specifies that the convention applies only to differences arising out of commercial legal relationships, whether or not they are contractual.

Further, the bill applies to arbitral awards and arbitration agreements, whether made before or after coming into force of both Bill 98 and Bill C-107, which as I indicated is the federal statute in this same area. Thus, upon the passage of this bill and the complementary bills across the country, awards made in other jurisdictions by other arbitrators in the past will be able to be enforced simply and easily here in Ontario and throughout Canada. It is not therefore intended to apply only to arbitration awards made after the date of the passage of this bill.

Further, the bill seeks to recognize and enforce arbitral awards. The procedure for this is a very simple one. Application may be made to the Federal Court in the case of awards made under Bill C-107, or to any superior, district or county court in the case of awards made under Bill 98.

By way of some brief background, I would comment that arbitration has many advantages over litigation in the resolution of commercial disputes, especially where they involve parties from different states. Traditionally, the route followed was an extremely complicated, convoluted one whereby the first order of business in any type of litigation between two commercial enterprises, whose home countries were different and whose home systems of law perhaps were quite different, was to sort out the jurisdiction of which court would be in charge of determining the dispute that had arisen between them; whether the dispute should be adjudicated under the provisions of the laws of Canada, Ontario, Britain, one of the European countries or whatever. That process often took as much or more time than the resolution of the dispute itself. However, that process will be significantly shortened and overcome by the passage of this and the complementary bills across this country.

Canadian businesses, which have not been in a strong position to request arbitration agreements in their international contracts, will now be much improved in their positions in this regard. They can now assure their business partners that foreign arbitral awards will be readily recognized and, more important, enforced here in Ontario and in Canada.

The New York convention, to which I have alluded, provides the means by which arbitral awards made in one nation may be readily enforced in another nation. By acceding to the convention, Ontario and Canada would be on an equal footing with all our major trading partners.

The convention was adopted by the United Nations Conference on International Commercial Arbitration in 1958. As of January l1, 1986, 69 countries around the world were parties to the convention. Interestingly, until the statutes are passed across the country, Canada is the only industrialized nation that is not a party to this convention.

As I have indicated, this legislation, together with similar federal and provincial statutes, will make it easier for Canadians wishing to conduct business.

The list of countries that are already members, of which the total is 69, is impressive, interesting and important because of the fact that it includes virtually all the countries of the free world. It includes all our major trading partners and most of our lesser trading partners.

How it has come to pass that the Canadian government has not seen fit until now -- that is, until the recent election of the Progressive Conservative government -- to implement the terms of this very reasonable and rational statute and convention is somewhat beyond me.

Notwithstanding my support and our party's support for the bill generally, as I indicated, I have some reservations with regard to some of the provisions of the bill, particularly in the area of what I think I know to be the amendments the minister intends to introduce during the committee of the whole House stage.

We have been presented with a series of amendments. I presume the minister will be moving those at that time, although, of course, he is free to amend or move, or otherwise, the amendments at that time. Presuming he intends to proceed with them, the major thrust of the majority of the amendments deals with the question of reciprocity.

In that area, because the minister has not seen fit at this time to explain to this House and to all those interested members who are listening attentively to each and every one of my words, I will proceed to provide some information and perhaps the arguments both for and against the necessity for amendments to delete the requirement for reciprocal arrangements before the bill can come into force.

As the bill is drafted, it provides that Ontario's awards would be enforced only if the nation or jurisdiction with which the Ontario businessman was doing business had adopted the provisions of the New York convention. If they had not, then we are not apparently willing to enforce the provisions of any arbitral award made in a country where such adoption had not been undertaken.

However, the amendments that I presume the minister intends to introduce would have the effect of deleting those sections and thus allowing us to enforce foreign arbitral awards made in jurisdictions that had not joined the convention.

4:10 p.m.

On this point, the then federal Minister of Justice, the Honourable John Crosbie, has written a letter to our Attorney General -- who has kindly provided copies of it to myself and I believe to some other members of the House -- in which this whole question of reciprocity is canvassed. I must state that it is a very learned treatise indeed that has been developed by Mr. Crosbie. He must have stayed up nights working on this paper, doing his research and studying the issue thoroughly.

In the true fashion of lawyers and with a tactic commonly and often used by lawyers to make their case most effectively, he first of all states the problem, which is obvious, and the decision that has to be made. He then goes on to give the reasons why we formerly adhered to a necessity for reciprocal arrangements before we would introduce such legislation or where we took the position that upon introduction of such legislation it must be reciprocal with other nations. He makes two very soft or weak arguments for that position and then, having set up the straw man, proceeds in some seven or eight pages of argument to knock them all apart and come to conclusion that he was quite correct in his latter approach rather than adopting the argument set out in the initial parts of his letter.

The arguments made generally for advancing reciprocity provisions are two. The first is to give Canadians equal protection with their foreign counterparts. The second is to ensure recognition of Canadian sovereignty by giving foreign judicial process effect here only if Canadian process is accorded equal treatment in that foreign country. He then comments that, in his view, neither motive survives examination in the context of international commercial arbitration.

With regard to the question of giving Canadians equal protection with their foreign counterparts, he goes on to make the argument against that position as to why it no longer is thought to be a valid position or no longer thought to hold water here in Canada. He says:

"On first impression, it may seem unfair to enforce an arbitral award in Canada against a Canadian in circumstances in which the Canadian would not have recourse to similar rules to facilitate enforcement of an award against any party in another state." On first blush, that argument seems to have some validity.

Hon. Mr. Scott: That is what Mr. Crosbie says.

Mr. O'Connor: Mr. Crosbie says that. I have indicated that is his argument, but his technique is to set up the argument in a rather wishy-washy fashion and then look good knocking it all apart.

He goes on to state:

"However, a reciprocity clause does not ensure protection from such disadvantage. This is because under the convention, the only criterion for granting reciprocity is that the award was made in a contracting state. The place where the award is made is not necessarily the same as, and in international commercial arbitration usually is not, the place where the parties to the arbitration carry on business or have their assets."

However, he points out his argument against that position:

"The important point is that the site of international commercial arbitrations generally has no relation to the parties, their businesses or their assets. Parties choose arbitration sites arbitrarily or because of a particular site's procedural rules, the expertise or neutrality it can offer, its language, its location or simply its ambience."

I suspect the latter is often a very significant factor; southern climes during winter months and cooler climes during summer months may just be a governing factor in deciding between international companies as to where they want to spend two or three weeks or months deciding this dispute that has arisen between them on a multimillion-dollar contract.

The minister goes on to point out, "The flexibility and privacy of arbitration allow this, but also tend to undermine the reasons for granting reciprocity, based on the award having been made in a contracting state."

With regard to the second argument, that it is necessary to ensure recognition of Canadian sovereignty by giving foreign judicial process effect here only if Canadian process is afforded equal treatment in the other jurisdiction, the minister similarly makes an argument in favour of that but then proceeds to tell us why it no longer holds water. He indicates:

"The award from such a process, having no real connection to the site, is not an exercise of the power of the state where the arbitration was held. Therefore, in granting reciprocity where the other side may not have done so, Canada is according no particular recognition to the host country in enforcing the award, as it would if it were enforcing a foreign judgement rendered by a foreign court when recognition in return is not required. Moreover, in an arbitration, the parties select the arbitrators themselves, who are not in the same position as judges appointed by a foreign government. There is no link between the arbitrators and a particular government, and there is no interest in the proceedings on the part of the government in the state where the award was made."

By way of general comment, it might be pointed out that arbitration is a private sector dispute mechanism that is carried on with little cost to the courts of the state where it is practised. In resolving the dispute itself, under this scheme there would be no cost whatsoever to the courts in the state where the matter is adjudicated, because there is no resort to the courts and the use of court space, judges' salaries, court personnel, filing mechanisms of courts, etc. It is done privately between two consenting companies or two consenting jurisdictions that have agreed simply to appoint their own arbitrator and to sit to resolve the dispute that has arisen between them.

The only cost, theoretically, that might be involved in this process is the cost that might be associated with the enforcement of any arbitration award that is then made, should that award adversely affect a Canadian company. The side that had won the dispute would want to avail itself of the enforcement provisions allowed under the bill; that is, a simple filing of their judgement with an appropriate court to permit them to avail themselves of the enforcement rights that any citizen of Ontario or Canada has after having obtained judgement from a court in our jurisdiction.

There would be some cost involved in that process; there are fees levied against people making these filings and fees required of them to sheriffs and other personnel in the system who are actively involved in the enforcement of the judgement by way of the seizure of assets, by way of cross-examination of judgement debtors, etc.

It is to Canada's advantage to establish an open system of international commercial arbitration to attract arbitration business. Canada is well situated to provide arbitration facilities to foreign businesses dealing with the United States or other countries. As I indicated before, there is some benefit to entering into this convention purely from the point of view that Canada is a very desirable locale for persons to want to come and resolve their disputes.

4:20 p.m.

I believe the British Columbia government has fulfilled its intention to set up an arbitration centre in connection with the Expo 86 site. That was opened in the initial stages of Expo 86. As we all recognize, Vancouver is a very pleasant city in terms of climate and available facilities. It can well be seen that foreign companies wishing to take two or three weeks to resolve a dispute that has arisen between them will want to make use of those pleasant facilities to do so. In that way, Canada will benefit from the foreign dollars that will be spent here by the parties, not only on their personal services and accommodation while here but also for the use of our facility, for which we would extract some rent or tee.

On balance, as is argued by the federal Minister of Justice, the reciprocity sections of the bill are no longer necessary and our party therefore will agree with the minister should he move those amendments in the hearing of this bill in committee of the whole House. We will perhaps comment at that time but none the less will agree that ultimately those sections should be eliminated.

There is one other provision of the bill I will comment on and about which I have some reservations. Of the countries that have adopted the New York convention, of which there were some 69 at the beginning of this year, one is South Africa. I have some concerns in this regard because of the current political situation in South Africa. We all remember the recent visit of Bishop Tutu and the resolution of our House with regard to actions that should be taken in terms of trading with South Africa.

I have some concern about the resolution of disputes between Canadian and South African companies that might arise over business dealings that occur between them. I recognize it is perhaps not possible to make an amendment to the bill to delete South Africa. We cannot determine or govern whether it wishes to be a party to the New York convention. It is not within our jurisdiction or the federal government's jurisdiction to do anything about that.

In regard to Canadian companies doing business with South Africa that become involved in a dispute with South Africa, can we effectively prohibit it from carrying the dispute to arbitration in some other country's facilities and have an unfavourable judgement such that South Africa would be in a position of wanting to force a judgement against a Canadian company here in Canada?

I hope the federal government and this government will adopt as a matter of public policy a situation where they will not recognize a foreign arbitral award made in favour of a South African company and will refuse to enforce an award against a Canadian company. That question might seem unfair to South Africa, but in the light of circumstances there and in the light of that country's dedication to a policy of apartheid, as a policy we should have nothing to do with South Africa by way of trading with that country. That is a position that is being taken universally throughout the British Commonwealth, except with regard to Mother England, unfortunately, but it seems it is being dragged kicking and screaming towards that position and perhaps will adopt it in the near future.

If we are serious about sanctions against South Africa and if we are serious about doing what we can to resolve the horrendous human rights situation existing there, I suggest a small step for this government would be to declare officially as a policy that it will not permit our courts and our court system to be used to enforce foreign arbitral awards of victorious South African companies against Canadian companies in these processes.

These are some of the concerns that I have with regard to this bill and that our party harbours with regard to this bill. We urge the government to bring forward the amendments the minister has indicated. He can expect support for them from this quarter. I also urge him to take seriously the comments with regard to the South African situation. Subject to those concerns, we will be supporting the bill. I thank the House for the opportunity to make these remarks on it.

Ms. Gigantes: I rise on behalf of the New Democratic Party caucus in the Legislature to say we will support this bill and the amendments proposed by the Attorney General.

Not having been engaged myself or known anybody who has ever been involved in international contracts of the nature that would fall under this act, I feel somewhat innocent in the area of arbitral awards and the acts that pertain thereto. One almost feels like saying "I am from Missouri" in this kind of question. I do not think anybody in our caucus has much experience with these matters.

I am sure there are people in the riding of Ottawa Centre and in other ridings around Ontario who will be most gratified by our decision to accede to the United Nations convention and to join the federal government in its implementation here.

The one thing that makes me a little concerned is the rush of the legislation in this area. We are dealing with a convention on the recognition and enforcement of foreign arbitral awards which was drawn up in 1958. Having waited 28 years, I do not know why we are rushing into this right now in a sitting in which we have many urgent matters to address before we rise, I hope, for a bit of summer recess.

My suspicions and concerns on this subject are somewhat alleviated by the understanding that the Canadian accession to the convention will become effective 90 days from May 12, 1986, when it was passed at the federal level.

I should mention my personal gratitude to the member for Oakville, who has so clearly and elaborately described the bill before us and the many benefits and possibilities we should look at in terms of reciprocity and nonreciprocity and so on. It was most helpful to me.

I was a bit concerned by his suggestion that when it comes to a foreign arbitral award given in Canada against a Canadian company in dealings with a South African company, we should not recognize such an award.

Mr. O'Connor: Reverse it.

Ms. Gigantes: Reverse it, if the member will, but it seems to me that would be to give a kind of reward or bonus to Canadian companies that were dealing with South African companies. If an award were made against them, we would not recognize it.

It seems to me that is the exact opposite of what the member intended in what he had suggested for us as a policy position vis-à-vis South Africa and South African companies. He would be wiser to address himself frontally to the development of policy on economic sanctions so we would not have any Canadian companies doing business in South Africa when the South African regime is carrying on a policy, as it is, that is abhorrent to the people of Ontario and of Canada.

Hon. Mr. Scott: I am grateful for the support this bill has received from all honourable members in the House so far today.

I should make a short statement about the reciprocity provision. Notwithstanding that Mr. Crosbie's letter was read to the House for the record, I am not sure it is entirely clear. I will also make a remark about the position of a South African award.

4:30 p.m.

First, let me make it plain that the reciprocity or no-reciprocity provision has nothing to do with a South African award. The reciprocity provision is found in the printed bill in subsection 1(1) where "foreign arbitral award" is defined as meaning "an arbitral award made pursuant to an international arbitration agreement and made in the territory of a contracting state other than Canada."

As the member for Oakville pointed out, an award could be made enforceable with a reciprocity provision simply by selecting the place where the award was made. If Brazil was not a contracting state, it could get its award enforced here, but we not there if it went to Geneva to have the award made. As Mr. Crosbie pointed out in his letter and as has been pointed out by other experts, upon reflection, reciprocity did not offset the disadvantage that was perceived to be present. As a result, we propose to follow the lead of Canada and the other provinces and ask the House to pass a series of amendments, almost all of which will deal with the reciprocity provision.

With respect to South Africa, the convention at the back of the printed bill in the form of a schedule includes article V.2(b), which provides that "recognition and enforcement of an arbitral award may also be refused" -- by the court of competent jurisdiction -- "if the competent authority in the country where recognition and enforcement is sought finds that (b) the recognition or enforcement of the award would be contrary to the public policy of that country."

That will give some but not total relief to the member for Ottawa Centre (Ms. Gigantes) in the sense that it would not of necessity prevent our courts from enforcing any award from South Africa, but would undoubtedly permit our court to refuse to enforce any award founded between the contracting parties, or one of them, on a practice or procedure such as apartheid, which is contrary to the public policy of this country. That is the purpose of that provision in the convention. I have little doubt it would be so understood by our courts.

Motion agreed to.

La motion est adoptée.

Bill ordered for committee of the whole House.

Projet de loi déféré au comité plénier.

House in committee of the whole.

La Chambre en comité plénier.

FOREIGN ARBITRAL AWARDS ACT / LOI DE 1986 SUR LES SENTENCES ARBITRALES ETRANGERES

Consideration of Bill 98, An Act to Implement the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

Étude du projet de loi 98, Loi concernant la mise en oeuvre de la Convention de l'Organisation des Nations Unies pour la reconnaissance et l'exécution des sentences arbitrales étrangères.

Hon. Mr. Scott: As a matter of convenience with respect to subsection 1(1), we intend to strike out the definition of "contracting state."

Mr. Chairman: Rather than indicate what the changes are, just give --

Hon. Mr. Scott: The section numbers?

Mr. Chairman: Yes. Thank you.

Hon. Mr. Scott: There are three definitions I propose to deal with in subsection 1(1). This bill was drafted by the Conservatives.

We intend to ask the House to defeat section 5. We will be calling for a vote on that. We have amendments to subsection 7(2) and to section 9 and we intend to ask the House to strike out the schedule.

On section 1:

Mr. Chairman: Hon. Mr. Scott moves that subsection 1(1) of the bill be amended by striking out the definition of "contracting state."

Hon. Mr. Scott: Perhaps I should tell the House at this time that all the amendments to subsection 1(1), with the exception of the amendment to the definition of "international arbitration agreement," together with the deletion of section 5 and of the schedule, arise from the proposal not to apply the convention in reciprocal fashion. The amendment to the definition of "international arbitration agreement," to which I will come shortly, clarifies the intent that the international element must appear in the overall relationship between the parties.

The amendment to subsection 7(2) clarifies its application to awards actually recognized under the act. The amendment to section 9 adopts the language of the Arbitrations Act.

Mr. O'Connor: The gratuitous comment the Attorney General made about the bill being drafted by the Tories is not factually correct. Inadvertent as he might be in his submission in that regard, its number indicates quite clearly that it was drafted by the Liberal government well after it took office.

Mr. McClellan: Why is there a need for 400 amendments then?

Mr. O'Connor: That is exactly my question. I could have left it to my friend.

Perhaps the minister can explain to us how the bill saw the light of day in such a form. Being a bill relatively short and to the point and being done at the request of the federal government, why does it suddenly require a series of amendments that are lengthy and take up some 40 pages? Can the Attorney General explain how that came about and why we could not have done it in a straightforward manner in the first place?

Hon. Mr. Scott: That is such a cantankerous attitude.

Almost all the amendments, except three, are a result of the fact that we have decided to move from reciprocity to nonreciprocity at the urging of the government of Canada. As a result, the amendments are necessary. That is the reason.

I am sorry. I was mistaken that this bill was drafted by the previous government. I intended to allow the previous government, now splayed on the opposition benches, to take some credit for it, but the credit is clearly undeserved and I withdraw it.

Motion agreed to.

4:40 p.m.

Mr. Chairman: Hon. Mr. Scott moves that subsection 1(1) of the bill be amended by striking out the definition of "convention."

Mr. O'Connor: On a point of order, Mr. Chairman: Going back to the previous one, do we not have to pass each of the subsections in French as well as in English or is it sufficient to do it only in English?

Mr. Chairman: I am advised that it is deemed to be done in French when it is done in English.

Mr. O'Connor: We ran into this situation before one of the committees with respect to another bill where, in some cases, the French translation was slightly different to the meaning in English. It was required, therefore, to do it in both cases. I do not wish to hold up the proceedings of the House in any way, but I want to see it done correctly.

Mr. Chairman: I understand it is deemed and presumed that the French is the same as the English and that the legislative counsel will ensure that. Certainly, far be it from the chairman to decide for you whether the French is exactly the same as the English.

Hon. Mr. Scott: I intend to move all those sections that have to be moved in French, but as the member for Oakville should surely recognize, and he has been here a year now, one does not have to read in both languages an amendment which strikes out a section. If we strike it out of the English, it is thereby struck from the French.

Motion agreed to.

Mr. Chairman: Mr. Scott moves that the definition of "foreign arbitral award" in subsection 1(1) of the bill be amended by striking out "international" in the second line and by striking out "in the territory of a contracting state other than" in the third line and inserting in lieu thereof "outside."

Motion agreed to.

L'hon. M. Scott: Je propose que la définition de "sentence arbitrale étrangère" au paragraphe 1(1) du projet de loi soit modifiée par substitution, à "internationale dans le territoire d'un Etat contractant autre que le" aux deuxième et troisième lignes, de "à l'extérieur du."

Mr. Chairman: I am not sure whether the minister read the third one in French or the fourth one he intends to move. At the end of the first sentence, was it "de sentence" or was it "convention."

Hon. Mr. Scott: I read the French translation of the English motion, replacing "international" and "in the territory of a contracting state other than."

Mr. Chairman: For the sake of the chair, you are reading your fourth amendment in French rather than English? Correct?

Hon. Mr. Scott: No, I read it in English.

Mr. Chairman: Is this the third one over again in French?

Hon. Mr. Scott: Let me put it this way. We have moved and passed the new definition of "foreign arbitral award" in English. I moved the new definition of "foreign arbitral award" in French.

Mr. Chairman: That is not necessary, because it is carried automatically in French after it is carried in English.

Hon. Mr. Scott: I am grateful for that, but I was challenged.

Mr. Chairman: No, the member for Oakville's point of order was not in order.

Mr. Scott moves that the definition of "international arbitration agreement" in subsection 1(1) of the bill be amended by inserting after "agreement" in the second line "in respect of a legal relationship."

Mr. O'Connor: Would the minister explain why that wording is necessary? I am sorry, I genuinely do not understand. I believe similar wording is not contained in the federal statute where it is not required to be an arbitration agreement in respect of the legal relationship.

Hon. Mr. Scott: I am advised that the purpose of this amendment to the definition of international arbitration agreement is to clarify the intent of the definition that the international element must appear in the overall relationship between the parties and not merely in their simple agreement to arbitrate. Whereas the agreement to arbitrate might give rise to a legal relationship, what is contemplated is that there be reference to a broader legal relationship than simply the agreement to arbitrate.

Motion agreed to.

Section 1, as amended, agreed to.

Sections 2 to 4, inclusive, agreed to.

On section 5:

Hon. Mr. Scott: I am asking the members of the House to defeat section 5.

The Deputy Chairman: Shall section 5 stand as part of the bill?

Some hon. members: No.

Section 5 withdrawn.

Section 6 agreed to.

On section 7:

The Deputy Chairman: Hon. Mr. Scott moves that subsection 7(2) be struck out and the following substituted therefor:

"7(2). A foreign arbitral award recognized by the court binds the persons as between whom it was made and may be relied on by any of those persons in any legal proceeding."

Motion agreed to.

Section 7, as amended, agreed to.

Section 8 agreed to.

On section 9:

The Deputy Chairman: Hon. Mr. Scott moves that section 9 of the bill be struck out and the following be substituted therefor:

4:50 p.m.

"9. This act applies to an arbitration to which Her Majesty is a party."

Motion agreed to.

Section 9, as amended, agreed to.

Sections 10 and 11 agreed to.

The Deputy Chairman: Shall the schedule stand as part of the bill? It appears that the schedule does not stand as part of the bill. Section 12 agreed to.

Bill, as amended, ordered to be reported.

On motion by Hon. Mr. Scott, the committee of the whole House reported one bill with certain amendments.

THIRD READING / TROISIÈME LECTURE

The following bill was given third reading on motion:

Motion adoptée pour la troisième lecture du projet de loi suivant:

Bill 98, An Act to Implement the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

Projet de loi 98, Loi concernant la mise en oeuvre de la Convention de l'Organisation des Nations Unies pour la reconnaissance et l'exécution des sentences arbitrales étrangères.

RENTAL HOUSING PROTECTION ACT

Hon. Mr. Curling moved second reading of Bill 11, An Act respecting the Protection of Rental Housing.

Hon. Mr. Curling: Bill 11, the Rental Housing Protection Act, is designed to preserve Ontario's affordable rental stock while the government's long-term housing policy has a chance to take effect.

As this government has noted from the very start, there has been a growing need to provide greater protection for tenants faced with the loss of their homes because of demolition, conversion and the luxury upgrading of rental dwellings. Because of years of neglect of the rental sector by the former government, an increasing number of landlords have been tempted to increase the profits from their properties by these various methods.

A 1985 report by the Canada Mortgage and Housing Corp. indicated that more than 5,000 units were lost in recent years in the city of Toronto alone. Tenants in many of the larger urban areas of the province have faced increasing fear and uncertainty. It is difficult for people fumed out of their homes to find alternative accommodation when vacancy rates are less than one per cent. The Rental Housing Protection Act will provide a breathing space while the pressures for demolition, conversion and luxury upgrading are reduced through our rent review and housing supply initiatives. The legislation is, in large part, a response to municipal requests for broader controls.

Under the bill above, demolitions, conversions and renovations involving the eviction of tenants will require the approval of municipal council in order to proceed. The sale of units in profit or rented co-op buildings will also require municipal approval.

This system will not apply in municipalities with a population of 25,000 or fewer unless the municipality is designated as having a rental housing shortage. The municipalities in which the system is in effect will be listed in the regulation made under the act.

We will be consulting with local councils and other interested parties in order to be able to respond to local housing situations that may arise around the province. There will also be an exemption for buildings of six or fewer rental units. Our research indicates that the six-and-fewer category has not been a major problem in conversions and other activities.

We believe the exemption of smaller buildings will also help to minimize the administrative burden for municipalities without substantially affecting the province's supply of rental housing.

I should mention that all condominium conversions will require municipal approval under the legislation. Local review of condominium proposals is a necessary part of the approval process under the Condominium Act. As I have indicated, a rental owner will have to receive municipal approval to demolish a rental building to convert it to another use or form of tenure or to renovate it so extensively that vacant possession is required.

Sales of the units located in a profit or rented co-operative building will also require municipal approval. However, the sales of units occupied by the vendor or by his or her family and units originally purchased prior to June 30, 1985, will be exempt from this requirement.

The concern that has been raised regarding conversion to apartment hotels is addressed by this legislation. Such conversions will require municipal approval under the act.

When a council receives an application under the Rental Housing Protection Act, it will be able to give its approval only if the following criteria are met:

Where the proponent has provided a satisfactory accommodation for the current tenants, has provided new rental housing stock at the same price in the same area or where, in council's opinion, the proposal does not adversely affect the availability of affordable rental housing or in the case of demolition or renovation that does not meet the first two criteria, council may approve if the building is found to be unsafe.

Before a decision is made on any application under the act, all of the affected tenants will have to be notified. A public meeting will also have to be held by council to inform the public about the application and to give all interested parties an opportunity to make their views known.

Under the general delegation of authority in the Municipal Act, the council may assign the conduct of this meeting to a committee of council, but the actual decision on an application will be made by the full council on the committee's recommendation.

The council's decision, either to approve or to reject the application, may be appealed by any party to the Ontario Municipal Board. If the council fails to make a decision within 30 days, the applicant can request that the matter go to the municipal board for a decision. The municipal board will have the same authority as the council and will be bound by the criteria set out in the regulations. The procedures normally applicable to board hearings will apply.

5 p.m.

When the municipal board has reached a decision, any party to the hearing will have the right to petition the decision to the Lieutenant Governor in Council. Cabinet will have the authority to accept, modify or reject the decision of the municipal board. Cabinet will also have the option of ordering a new hearing by the board if it is evident that these are issues requiring clarification. The board's decision after this new hearing would be final.

This is the approval process provided for under the Rental Housing Protection Act. As I have said, the purpose of the legislation is to give our long-term policies for revitalizing the rental housing sector time to take effect. We are confident that both our rent review and our housing supply initiatives will greatly reduce the incentives for demolitions and conversions.

The rent review system is being simplified and streamlined to the benefit of both landlords and tenants. The new system will also make provision for a fair and reasonable rate of return on rental investments.

The $500-million assured housing programs announced last fall are designed to stimulate the production of 44,500 rental units. An additional 18,500 units will be preserved from demolition through the rental rehabilitation loans made to owners of older buildings to help them bring their premises up to provincial and municipal standards.

We will be monitoring the rental situation carefully over the next 24 months. Proposals will be developed before the end of the period that are appropriate to the situation prevailing at that time. For now, I urge the members of this House to support our efforts to protect Ontario's residents against the loss of their homes. We believe the importance of preserving affordable rental housing justifies all-party support for speedy passage of Bill 11, the Rental Housing Protection Act.

This urgency was also expressed and addressed in a news release on April 24, 1985. It was erroneously dated by the honourable critic of the official opposition, the member for Sudbury (Mr. Gordon). Also, the critic of the third party, the member for Riverdale (Mr. Reville), has expressed his concern about getting this bill through. Just today, the member for Ottawa Centre (Ms. Gigantes) expressed her concern about the urgency of this bill and said that each day we delay this or it is in the House, rental units could be lost in the manner that I have just expressed.

Mr. Gordon: I take this opportunity to address my remarks to the bill under discussion. I have listened carefully to the comments of the Minister of Housing and I am disappointed in the role that has been taken by the minister to date, particularly with regard to the whole question of affordable housing in this province.

Surely by now we should be seeing many more foundations going into the ground in many communities across this province. It just is not happening. This particular bill certainly addresses the problem of conversions, and it is a bill that shows some sensitivity to many tenants in this province. However, it is like a double-edged sword. On the one hand, it is going to help tenants; but on the other hand, I think it is going to do some very real damage to property rights in this province.

I would like to talk this afternoon about both of those issues and some of the effects I see flowing from this bill. I think all of us in this House today agree that the crisis in housing increases daily. The vacancy rate hovers consistently around 0.3 per cent in many of our major urban areas. We also have to recognize that more and more tenants are finding themselves unable to find decent affordable accommodation.

On the other hand, we have a government that spends a great deal of time preparing for press conferences and talking about historic agreements being reached between landlords and tenants, but we see very little housing being built in the province. The Minister of Housing is going to have to take full responsibility for that. He has been minister for almost a year. When we ask where is the housing, the answer that comes from the other side is, "We are working on it."

The minister can hold only so many press conferences to tell people about the wonderful things he is going to do. Soon he is going to have to show some activity. Some people in this province, some developers or landlords, are going to say that Bill 11 does nothing to encourage the small developer and does nothing to encourage someone who owns property with rental units to build or to make the kinds of investments necessary to provide decent affordable housing. I point this out to the minister.

As I indicated, we are mindful on this side of the House that this bill is a double-edged sword. As a party not blinded by inflexible ideologies, we see both sides of that sword and are most alert to the dangers inherent in a bill of this nature.

Mr. Grande: On both sides of the fence, are you?

Mr. Gordon: The New Democrats should not provoke me.

Mr. Grande: The member provokes himself.

Mr. Gordon: Just as long as he understands. Let us consider the context in which this bill appears. Let us consider how the minister's policies, like bad sorcerers, do undo one another. The Minister of Housing is wont to repeat often in this House that his assured housing program and his bill comprehensively address the housing crisis we face today. Many times in replies to questions in this House, he has told us that he is relying on the private sector to build 44,000 unassisted units over the next five years and that the private sector is gladly going to re-enter the rental housing market because of the confidence the minister's policies have inspired among developers. He claims to have created a climate of certainty in this province, a climate that is going to encourage developers to build.

I have talked to developers in this province about Bill 11. They are saying such things as: "This does not encourage me to build. This takes away my property rights. This takes away the rights that are mine to do what is necessary in my building without going through a long involved process with a municipality." It is a double-edged sword. It depends on whom one is talking to.

5:10 p.m.

On the other hand, if one is at all cognizant of what has been going on, particularly in large metropolitan areas such as Metro Toronto or Ottawa, one will see there have been conversions of many apartments to condominiums. Those conversions have been increasing at a very rapid rate. As a matter of fact, we have seen more than 8,000 units converted in Toronto in the past five years. That is going to have a serious effect on affordable housing units in this province. It is particularly serious because once we take an affordable housing unit, an affordable apartment, and it is converted into a condominium, it is no longer available as an affordable apartment. It is gone and it is gone for ever.

The minister may ask, "Why does he say it is gone for ever?" Look at it this way. We know that when developers go out today and build apartment units -- I know those civil servants sitting in the gallery know that and I am sure they have told the minister this -- they are usually luxury units. We know it takes almost 20 years for luxury units to become affordable units that the average person in Ontario can afford to rent and move into.

We have a situation where luxury units become affordable units only after about 20 years, which is like an eternity for most people looking for affordable units today. On the other hand, we have a crisis in Ontario that is worsening day by day. We have people all over this province who are looking for affordable housing units and cannot find them. According to the estimates that come out of the ministry, we now have more than 200,000 people who have an affordability problem. We have another 40,000 people who are currently on waiting lists for affordable housing.

In looking at Bill 11 as a two-edged sword, on the one hand, we see that when we take away an affordable apartment unit, it is gone. It becomes a condominium and it does not come back. On the other hand, if we are looking for more affordable housing to be built, if we are looking to the private sector, we cannot expect that type of housing to come on stream for at least 20 years.

There is a very real and serious problem in Ontario today and it is a problem that, in my view, is not being addressed. The minister may say: "What do you mean, it `is not being addressed'? I am bringing in Bill 11 and that will help to stop this haemorrhage of affordable housing being lost." On the other hand, the minister is literally failing when it comes to providing more nonprofit housing to help provide affordable housing for those people who really need it in this province.

We have a government which has had a real windfall to its Treasury because of the increased taxes it brought about, not in this last budget, but the one before when it first came into power. It has money coming out of its ears; yet we know on this side of the House that nonprofit housing, co-op housing, is not really being built at any pace at all in this province today. It is not being built because the maximum unit price that the federal people are looking at is impinging upon the number of units that can really happen in this province today.

We do not see a government which recognizes the crisis. We do not see a minister who is going to cabinet and saying, "I need millions of dollars more to create that affordable, nonprofit co-op housing I promised the people of Ontario for the past year." We do not see that. Instead, we see the minister sneaking into this House -- well, no, not sneaking into this House; I want to be fair -- striding into this House talking about historic agreements, holding press conferences and parties even in the Premier's ante-room or boardroom, to do what? To create more housing? Where is the housing? It is not being built. It is just not happening; instead, we have something like Bill 11.

What is Bill 11 designed to do? Bill 11 is designed to stop the haemorrhaging in the existing housing stock, the apartment stock that is being converted into condominiums. That does not answer the fundamental problem in Ontario today. The fundamental problem today, in my view -- and I hope the minister is listening to this -- is that the government has to build some affordable housing and it has not done so. It is still not building that housing. It is dancing around the periphery, dancing around the edges. Those people down at Earl's corner

Mr. Mancini: Earl's garage.

Mr. Gordon: That is true, Earl's Shell. When the people down at Earl's Shell kick those tractor tires, they are not fooled by this kind of bill. As I said, it is a double-edged sword.

I would like to indicate to the House what some of the people on the other side are saying about this bill. This bill affects two groups: the tenants and the developers and landlords. Let us talk for a minute about the private sector.

This is where I have a concern. On the one hand, the minister says that as a result of his press conferences and historic parties developers are going to become much more confident about what they should be doing in Ontario. In other words, he is suggesting they are going to build more units.

He went out and promised 44,000 unassisted units would be built, but he has not indicated what some of these developers have been telling me. They are saying that here is a minister who is relying on the participation of the private sector to resolve part of his housing crisis. We have a bill that has not only the larger developers, but also the small- and medium-sized property owners and landlords up in arms over what they consider to be the complete nationalization of their industry. That is what they are saying.

Let me get this straight. First, the minister tells us he is creating confidence in the private sector in this province and that, because of that confidence, more housing units will be built. I think I have that straight. On the other hand, we have developers saying: "Hey, wait a minute. This guy is nationalizing what we have out there now."

Let me get it straight now. That means the minister somehow knows something no one else in this House knows. He must know something special. Obviously, he does not know anything special because that is the fear out there; so I do not think he is creating confidence.

These developers and landlords see themselves as mere trustees of the state. They have no right to do what they want with their property. That is what they are saying. Our office has received a great number of calls from developers about this matter. Those are the kinds of sentiments they have expressed.

5:20 p.m.

We should be mindful that this bill obviously destroys the incentive for private sector investment in the rental housing market for some private developers. This has been reflected in many of the news reports we have read and seen in this province since this bill was introduced. Who is going to build the badly needed rental housing? Certainly, no one who has any concern over the types of controls that might be put over their investment.

The government is going to have to become the biggest landlord anywhere in North America by the time all the effects of its policies have been felt. The minister is going to have to build a lot more than 6,700 nonprofit and co-op units a year even to make a dent in the crisis we face today. With some trepidation, I have to ask myself at what cost.

As I indicated, this is a two-edged sword. On the one hand, this bill will have the effect of discouraging investment in housing, particularly from the private sector. On the other hand, there is no one in this party who cannot but be sensitive to the problems that exist out there right now in the housing sector, particularly for those people requiring affordable housing. As Conservatives, we are people who value the concept of community, family and church.

In Ontario today, many of our elderly citizens who live in low-cost rental housing are being dispossessed of their homes of 20 and 30 years because developers have become fed up with rent controls and want to make more money on their investment. On an individual basis, we can all recognize that it is understandable that a person wants to have a better rate of return. However, when we look at the present crisis, when we look at what we face as a result of that crisis, the loss of low-cost housing without new, affordable rental stock coming on stream, we would be negligent not to act in accord with our tradition of social conscience.

The context in which this bill is being introduced is an unprecedented housing crisis. As I indicated, 40,000 people are on waiting lists for subsidized housing across the province. There is a 0.3 per cent vacancy rate. When we see the number of people, particularly in the metropolitan area of Toronto, who have found their housing is disappearing and that there is no other affordable housing to go to, it is obvious some steps have to be taken for the time being. I understand this bill is being put forward for a two-year period. I believe anything longer than that would be an admission on the part of the government opposite that its housing policies have failed abysmally.

Given the present situation for tenants in this province and the fact that affordable housing is not coming on stream -- the private sector is not building any and the government is not building any, although it promised all kinds of co-op and nonprofit, which is just not happening and it is a farce -- the only thing we can do under these circumstances is to agree that this bill is necessary for a limited period. We do have some amendments that we will be putting forward during clause-by-clause debate. These are amendments that will improve this bill.

Mr. Reville: This bill has been languishing in Orders and Notices for the fifth Wednesday in a row. We have been anxious to get at this bill because the situation for tenants in Ontario is not improving. During the five weeks that some of us thought we would be able to deal with this bill, tenants in Ontario have been under increasing attack. It is a shame we could not have seen this bill before now and had it passed into law.

In a way, this is where I came in. In the early 1970s, a group of us was trying to save rental housing in an area south of St. James Town in the city of Toronto. That is in the riding of St. George. A particularly successful Toronto developer managed to acquire blocks of rental housing and was going through a process of blockbusting at the time. I am speaking of a situation in history that --

Mr. Mancini: Mr. Speaker, on a point of order: I apologize for interrupting the member for Riverdale. I know he has some well thought-out comments to make on this bill. However, I was hoping we would be able to respond to the comments made by the member for Sudbury, as the new rules allow.

The Acting Speaker (Mr. Morin): I accept the member's point of order. I apologize. It was an oversight. Are there any questions or comments?

Mr. Mancini: I would like to make some comments on the speech by the member for Sudbury, a member I have known for some years. I know how strongly he feels about certain items. He probably feels deep down inside that we should not have any conversion legislation. I am not sure what his exact feelings are on rent control or rent review.

Having made those comments, I would like to say it is unwise of the member for Sudbury continually to attack the Minister of Housing about matters on which he considers the minister has not taken action. If the member had read all the press releases sent out by the Minister of Housing and all the comments he has made, then if the member was fair about this matter, he would judge that the minister has been active in providing some type of protection for tenants and trying to spur on the building of housing units.

The other thing I want to point out is that when the member for Sudbury was making his comments, I was not sure which bill he was talking about. He seemed to touch on a broad range of housing issues and, in my view, spent very little time on Bill 11, which deals with conversions.

Is it the Conservative Party's view that the people who live in the apartments that are going to be converted should not be protected? Is that the member's view? Is it party policy? Is that what the Leader of the Opposition, the member for St. Andrew-St. Patrick (Mr. Grossman), is telling the people of Ontario? I think that is the crux of the matter. We are trying to give tenants protection. From the member's comments, it appears he is not in favour of such protection.

Mr. Gordon: I am surprised at this interjection by the member for Essex South (Mr. Mancini). He obviously was not listening to my remarks, because we made it very clear we will be supporting this bill. The fact that he did not hear exemplifies the attitude of the Minister of Housing. He does not hear what is happening out there on the hustings.

5:30 p.m.

As I pointed out earlier, houses are not being built. We have a crisis of a magnitude that is almost unbelievable. The only thing the government does is hold press conferences. It has to bring in a bill to stop the haemorrhage of affordable housing, but it is not building anything. That is the shame in Ontario today. A year or six months from now, when we bring the figures into this House, the figures of what he promised and the figures of what has actually happened, he is going to have to resign.

Mr. Reville: It may still be possible for me to splice my speech back together. I was at about 1970. Mr. Speaker, please bear with me; this is going to be a six-hour speech.

We were trying to save some affordable rental housing back in the early 1970s. At the time, the enemy was a certain number of fairly rapacious developers, who were very successful at buying up blocks of rental housing, knocking one unit in the row down and moving a motorcycle gang into one of the remaining units. Sometimes there would be mysterious fires. When the tenants fled in disarray, blocks of the community would be bought up and demolished. True enough, eventually the landscape would be scorched, no rental housing would be left and something else would be constructed in its place, quite often a parking lot.

Time has moved along and the attack on rental housing has become somewhat more sophisticated. The motorcycle gangs are gone, but the development industry has refined its methods and has hired snake-oil salesmen to trick tenants into agreeing to some other form of tenure and to get them, notwithstanding the armour of the Landlord and Tenant Act, out of their units so that those units can be torn down and replaced with other units, usually very high-priced units.

One of the jobs I did when I was on Toronto city council was to chair the neighbourhoods committee. The neighbourhoods committee was the place where we made decisions about how much of the city should be left standing and how much of it should be torn down. Every second Thursday at 10:15 in the morning, we would have the demolition section of our agenda. Various properties would be brought forward and we would try to make decisions about whether the buildings should be torn down or left standing and the tenants left therein.

Unfortunately, in spite of its undoubted wisdom, the council of the city of Toronto did not always decide to prevent demolition of property, nor was it always able to. That was for many years the source of much concern in the city of Toronto and in other municipalities in this province. In fact, they came to the previous government and said, "Please, on behalf of the tenants of Ontario, give us the authority to control demolitions."

The previous government dillied and dallied and shillied and shallied. After a great deal of affordable rental housing stock was lost, it finally agreed to give the city of Toronto the ability to control demolition for one year under some conditions.

I am sure anybody who was in the 32nd Parliament will remember very well the massacre on Eglinton Avenue. The member for Eglinton (Mr. McFadden) will remember it well because he had to choose sides on the issue and he had to choose the tenants' side. I remember the then Attorney General, who is now the Canadian High Commissioner to Britain, sent a message to Toronto city council. It was the most preposterous message I had ever read. It said: "We do not know what to do about the Eglinton apartments. We do not know what the city of Toronto wants."

Eleven of us decided that rather than vote for the demolition of those affordable units, we would quietly absent ourselves from that council meeting so there would not be a quorum. What a stir we caused. There was a learned justice who thought that was a dreadful thing. He issued a contempt order against the Corporation of the City of Toronto. A great many citizens thought that was a terrible thing and they, for some strange reason, sued the 11 of us.

I recently finished paying my lawyer's fees in respect to that lawsuit, but the members will be glad to know we were found not liable in the cause and, in fact, the fine of $115,000 was returned to the Corporation of the City of Toronto because the learned judge decided he had been just a mite hasty.

That perhaps explains how important the ability to protect rental housing stock is to those who sit on municipal councils and how desperate a local council can sometimes be when it does not have the tools with which to do that.

This is not confined to the city of Toronto. It happens in municipalities all over the province, because sometimes it happens that municipal councillors are just a bit closer to their constituents than is always possible in the Legislative Assembly. Aldermen and councillors receive entreaties daily from constituents who are facing the loss of their housing stock.

I remember some particularly poignant cases that occurred while I was on the neighbourhoods committee at the city of Toronto. I remember one in particular because it was a very large issue for me and for my neighbourhood, not so much because of the size of the project that was demolished, but because of the manner in which it was demolished.

It concerned a group of historic cottages near the corner of Queen Street and Broadview Avenue on a street that rejoiced in the name of Baseball Place. The street was called Baseball Place because at one time Toronto's baseball stadium was at the end of this little street. Subsequently, the baseball stadium went to the island, then it went down to Stadium Road and now it is in the CNE. Perhaps soon it will be near the CN Tower, but at the time, that is where the baseball stadium was. That was in the late 19th century.

An application came forward to demolish six one-storey houses in a row. The application said they were vacant. I knew that was not correct because some of the tenants in the row had called me and said they were being asked to leave. They wanted to know whether they had to leave. I said, "No, you do not have to leave because the owner does not have a building permit and I hope the city of Toronto will decline to issue a demolition permit."

Notwithstanding that, the landlord went to the tenants and said, "You have to leave; the city needs the property," and by other means managed to convince the people to leave. Then the landlord went and vandalized the units. He actually pulled the plumbing fixtures right out of the wall, put hammers through the toilet bowls and ripped out the hot-water tanks.

We used to like pictures at city council as it helped us to understand things. Local politicians are not quite as smart as provincial politicians, so we got pictures. The pictures depicted the terrible state of these units, except that the day before the pictures had been taken, the units had been absolutely fine. There was nothing wrong with the units at all and they were eminently affordable units.

5:40 p.m.

Unfortunately, the council decided they had to be torn down, seeing they were such crummy housing, and they were torn down. Now they are paved over and cars are parked where there once had been six units of affordable housing.

The member for Sudbury waxed eloquent about the concern the Conservative Party has for community, family and church. I am not sure of the relevance of that, but I want to add a story about a church. He triggered a synapse in my mind that made me think of the case of the church that came forward through the neighbourhoods committee because it wanted to demolish two houses on church property.

Lest the neighbourhoods committee not understand how important an issue it was, the church brought the bishop. Of course, we all trembled there in our chairs. Lo and behold, the council decided to knock down two perfectly good houses so that there would be a little more space for parishioners to park on Sunday when they came to church. That was a very difficult moment for me because it struck me that one can build houses in heaven, but one still needs houses here on earth. To knock down houses so that people could park a little closer to church on a Sunday was a very odd priority indeed.

I share these stories, not only because I know the members appreciate them very much but also because I am trying to make the point to the Minister of Housing across the aisle that what has been offered to us in an effort to protect rental housing may not be the instrument we want. Some of the decisions that have been made in the past by municipal councils have not necessarily been made with affordable rental housing as the key priority; other priorities have intruded. Obviously, it is the job of politicians to balance priorities all the time. Municipal councils, like any elected body, may not always choose the correct priority.

What is it about Bill 11 that sets the priorities for a municipal council? It is the criteria through which a council will have to judge an application for a demolition, a condo conversion or a renovation that requires vacant possession. Unfortunately, the criteria that have been offered to us, which do not appear in the bill but in the regulations, are not very strong.

The criterion that will most often be used by a municipal council when an application comes before it will not be the criterion that relates to whether the building is unsafe. That is a situation that does not often occur. It will not be the criterion that says it is all right if one builds an equal number of affordable rental housing units. I do not think that is likely to happen. The criterion that will most often be cited by applicants will be the one that says, "In the opinion of council, the proposal does not adversely affect the supply of affordable rental housing in the municipality."

The stories I have just described should show that criteria as vague as those in the regulations are not going to prevent a municipal council from granting approval to a large number of applications. I will mention the city of Toronto again. I apologize for using this example. It is obviously the example I know. I do not like to be too Toronto-centred; that is one of the charges sometimes laid against Metro members, with some justification. There is a very large province out there and what happens in Toronto may be of marginal interest anywhere else.

The city of Toronto had a very strict condominium conversion policy. There was no conversion of apartment houses as long as the rental vacancy rate was under 2.5 per cent. The member for High Park-Swansea (Mr. Shymko) is going to take his chair and listen to this. It is a good idea too. The vacancy rate did not once approach 2.5 per cent and it is not now threatening that threshold of 2.5 per cent. I suspect the real vacancy rate is a negative; it is not 0.03 per cent. It is a negative vacancy rate because there are waiting lists in all sorts of rental complexes so that units will never come on the market at all.

Notwithstanding the very strict condominium conversion policy that was in place in the city of Toronto, before it was watered down somewhat -- this was a policy that was in place between 1980 and 1983 -- 708 units were lost to condominium conversion. The council decided that even though they did not fit within the very stern criteria that had been established, for other reasons it would allow the condo conversions to occur. Of course, the biggest and most famous was the Village by the Grange, which was converted to condominiums. I have to say I voted against that conversion, as I did against every subsequent conversion application.

The member for Sudbury has described Bill 11 as a two-edged sword. It may be so for the Tories, and I suspect it is a double-edged sword for the Tories because the one Tory who is now leaving the Legislature does not want this bill to pass at all. In fact, I will give him a button on the way by. It is called "Freedom of Destiny for High Park Tenants." I want him to have this button. Let the record show I gave the button to him.

Mr. Barlow: And the member got it back.

Mr. Shymko: And let the record show I pinned it on the member.

Mr. Reville: I think I should wear this button proudly as it has appeared on my lapel. I have found one has to make do with what one ends up with in life, because that is clearly what I am after. This button says "Freedom of Destiny for High Park Tenants." The way to ensure that tenants have a good destiny is to protect rental stock.

There are three basic issues in housing in Ontario that have to be addressed. I float this series of three issues over the top of the head of the member for Sudbury in the hope he will listen, pay attention and get them right so that he does not mix them all up in his next speech.

There is the question of protecting tenants; there is the question of protecting stock; and there is the question of creating new stock. Those are the three most critical issues with respect to housing, and there are ways to deal with each of those issues. On occasion, they interrelate and overlap somewhat, I agree.

5:50 p.m.

Bill 11 purports to protect the stock and, by implication, the tenants who live therein. I want to complete my little image here; so I have to say again that the member for Sudbury says it is a two-edged sword. I think of it as a wet noodle. I do not think Bill 11 effectively protects rental stock. I have already suggested one reason it does not protect it very successfully, namely, the criteria in the regulations are far too weak. They create vast loopholes which not only a municipal council but the Ontario Municipal Board could use to grant approvals, and so, God forbid, could the Lieutenant Governor in Council. I am not aware that the Lieutenant Governor in Council has to explain why he, she or it decides to do particular things; perhaps we will never know just why the Lieutenant Governor in Council decided something. However, I am very concerned that, in view of the fact that it takes a very small loophole to slip through a notice of termination, Bill 11 creates large loopholes indeed.

I will spend just a minute or two pointing out a couple of other problems I have with the bill. I want to allow people lots of time to speak. The bill does not cover a very significant portion of our rental stock. That is because the regulations exempt from the application of the bill residential rental properties of fewer than seven units. A number of the members of my caucus, notably the member for Oakwood (Mr. Grande) and the member for Ottawa Centre, have pointed out problems relating to this exemption in the bill. A vast number of units are not going to be protected; it is 446,000 units.

I am not sure why the government has decided to leave fully one third of the rental housing stock in Ontario without even the wet-noodle protection of Bill 11, and it troubles me a great deal. I know the member for Oakwood in particular will be speaking to this issue. I will be moving an amendment when we get to clause-by-clause discussion on this bill, and I hope we get to clause-by-clause on this bill very promptly indeed. This is not a bill that needs to go out anywhere. This bill can be dealt with right now in this House in committee of the whole, because every day we delay loses more units in this province.

More building permits and demolition permits are being issued. Guys out there with big cigars are asking, "How would you like to buy a little you know what?" We have to move with alacrity and we have to move with certainty on this. We have to have some amendments to this bill so that we can seriously protect the affordable rental stock in this province and provide for the tenants of Ontario some real control over their lives.

As we all know, the home is the very centre of our lives. It is where we make our plans, it is where we hang our hat, it is where we keep our shoes, it is where we pay our bills from and where even members of the provincial parliament sometimes go to relax and to try to decide what they are going to do next.

Mr. Speaker is leaning forward expectantly to hear what I am going to say next. I am very concerned that this bill does not cover fully one third of the units in this province. That is a very serious oversight. I am sure it is just an oversight. I am now convinced that the minister is going to stand at the conclusion of my remarks and say, "Mr. Speaker, I have made a terrible oversight and I am now going to include 446,000 more units."

My second major problem, as I said earlier, is contained in the regulations, where the criteria are described. I would like to move an amendment when we come to that stage -- and I hope we come to that stage very soon; I say that again -- that the criterion relating to the effect on affordable rental stock has to be connected to the vacancy rate for it to make any sense at all.

My party had a meeting not long ago in Hamilton. Every couple of years we get together and chat one with another, and we had some ideological debates. Members may have heard about them. We all, thousands of us, join arms in a big room. We are all equal in the room and we all share our views as to how the world should be.

While we were sharing our views, a resolution was passed relating to this bill. Our party is a very topical party. It debates stuff while it is happening; it debates stuff after it is happening; and it debates stuff before it is happening. It is an incredible party. The members should join this party.

One of the decisions my party made while it was meeting, talking, sharing and thinking about the future together was a decision about the criterion which now causes me to amend my own amendment. I am no longer going to suggest a vacancy rate of 2.5 per cent. The party has spoken and I agree with the party. It now should be four per cent, which will provide 1.5 per cent more protection for the tenants of Ontario. That is the kind of party we have.

I hate it when the sunset comes. That is my third concern about the bill. When the sun goes down, that means things stop. The sunset clause of this bill is a very serious problem. It is not a serious problem for the member for Sudbury. He would like this bill to sunset yesterday. On the other hand, we do not want to be standing around on June 30, 1988 -- there is some kind of magic to June 30 -- when all of a sudden this wet-noodle protection for the tenants of Ontario disappears.

Suppose this legislation manages to work for a couple of years. Does anyone in Ontario believe for a moment that we will not continue to need protection for our housing stock? Even if the minister's supply program delivers every single unit he hopes it will deliver, that I hope it will deliver and that I hope he will increase -- perhaps at the end of my speech he will get up and increase it -- even if we get what he likes to describe as the 6,700 units, then the 5,000 units, then the 400 units and then the 13,000 units, even those thousands of units will not make up for the rental stock we have lost in the past few years, nor will they come close to scratching the surface of the need for affordable rental housing in this province.

I will be moving another amendment. The amendment will say the government cannot sunset this bill unless it has some housing policy in place, protected by legislation that has been given royal assent and that will really protect rental housing stock -- not wet-noodle stuff, but really serious protection that says: "We as a government and as a Legislature believe affordable rental housing is an absolute necessity in this province. We are not going to stand by while that stock is threatened, while that stock is knocked down to make way for parking lots, while tenants are thrown out on their ears only to be replaced by other tenants who are paying three times the amount or by home owners who have stolen a rental housing unit from what is absolutely essential in this province."

That is an absolutely essential thing. A piece of work the Minister of Housing will want to get busy on is developing policies, and not a process, to protect rental housing stock. When all is said and done, Bill 11 is a process; it is not a policy. It provides a flow chart through which applications can go. It does not say, definitively, loudly and proudly, that the government is determined to protect rental stock. That is a serious problem.

6 p.m.

My last remarks today have to do with the fact that the bill comes into effect when it receives royal assent. I find that lamentable because it is not a surprise to the Minister of Housing. It is not a surprise to the Ministry of Housing staff, who, I might say, have been very gracious and helpful in discussing the bill with me. If not gracious and helpful enough to agree to ask the minister to change it, they have indeed been gracious and helpful. At any time I had a question, they gave me an answer to it and I appreciated that.

I will pick up the thread I have left dangling over there. Mr. Speaker, I am going to pick it up nand I know you will be comfortable when I do, as soon as I remember what the thread is. There is no one -- here it comes; the human mind is amazing -- who did not know there was a crisis in housing, to use the words of the member for Sudbury, an precedented housing crisis. Members have to know that when the Tories finally realize something is a crisis, it has been around for a long time.

I have real trouble with this bill. First, it did not arrive for second reading until July 2, 1986, when during the election campaign in the spring of 1985 Liberal candidates were bleating all over this province about their concern for affordable housing stock. The Premier, who at the time was a much quieter and perhaps less cool Leader of the Opposition, used to drop around and chat with me about how concerned he was to protect rental housing. We used to sit on platforms together. How was to know I was sitting next to the next Premier of Ontario at the time? I certainly would have worn better clothes if I had known that.

He used to stand up before tenants and say, "We, the Liberal Party of Ontario, are concerned about the loss of affordable rental stock." I believed him then and I believe him now. That is why I know the Premier's concern is shared by the Minister of Housing. We will not end up with a situation where this bill does not take effect until it receives royal assent; in fact, the minister will make it retroactive.

As my dear colleague the member for Ottawa Centre pointed out in her question today, when Bill 11 was given first reading in this Legislature on May 5, a foot-race began. Landlords all across the province hurried to get their permits so they could get under the wire, so they could get the tenants out of their units. That has been going on all over the province. In those cases where they have not got rid of all their tenants, it is time to reach back and put a tourniquet on that bleeding, and that has to be done.

I thank you, Mr. Speaker, for your indulgence and careful attention. I look forward to hearing the speeches of my colleagues on this matter. I also look forward very much to pushing strongly for the amendments I have suggested I will be moving to see that we end up with an act that will seriously protect the rental housing in this province.

The Deputy Speaker: Questions or comments? There being none, does any other member wish to participate in the debate?

Mr. McFadden: I rise today to support the bill on second reading. There is no more immediate problem for many people in Toronto than the lack of affordable housing. As has been cited on various occasions in this House, the vacancy rate in Metropolitan Toronto is now down to 0.02 per cent, This means that something like only two out of every 1,000 units are vacant at any given time within the area of Metropolitan Toronto. One could even argue that there is no vacancy rate at all in view of the fact that one building after another of desirable housing has a waiting list of some considerable length.

I know of some buildings in my riding where the waiting list numbers in the hundreds, so that if a tenant does move out, while there may be a vacancy for a day or so, one cannot really say the apartment effectively enters the housing market at any given time, since there are more than enough people to fill it immediately.

Since 1981, nearly 10,000 rental apartment units that were subject to rent controls have been lost in the Metropolitan Toronto area. That amount represents nearly 10 per cent of the affordable rental accommodations in Metro. Many of these units disappeared from the market and were converted into luxury units.

I have raised on a number of occasions in this House the plight faced by the tenants of 11, 15, 21 and 25 Sherwood Avenue within Eglinton riding. A new landlord purchased these four buildings last fall from an estate that had owned them for quite some time. That landlord is now seeking vacant possession of the premises in order to renovate the apartments into luxury units.

The Sherwood Avenue buildings, containing some 99 apartments, were built decades ago. They have provided decent and reasonably priced accommodation for people of all ages, but particularly for senior citizens. About 50 per cent of the people in these buildings are seniors. Many are over the age of 70 years and a considerable number are over 80 years of age.

Most of these senior citizens have lived in the buildings for many years -- in fact, for decades. One couple I met have lived in their apartment in one of these buildings since 1937. Losing an apartment that has been their home for 20, 30 or even 40 years is traumatic enough for a man or women in his or her 70s or 80s; it is even worse when there are no other apartments, let alone at an affordable price, anywhere in the neighbourhood in which they live. For many of these seniors, eviction from their apartments represents a life crisis that they are often ill equipped to deal with both financially and emotionally.

It has been interesting to note the development that has taken place in this particular set of buildings, since it has been quite typical of what I have found in other areas of the city. A tenants' organization was established when it became clear the landlord was going to go ahead and evict the tenants. The burden of leading the fight was not carried by the seniors, who represented a clear majority in the buildings. It was carried by the younger tenants.

In talking to these younger tenants, who have provided leadership to the tenants' organization, I found the reason they took on the job was not that they were afraid to lose their apartments, because they knew they were young enough, had jobs and could move on to other units they could afford. They were carrying on the fight because they had seen the terrible impact that the threatened eviction would have on the seniors who lived in the building, and so they organized and have been fighting the eviction and demolition to help their fellow tenants rather than themselves.

6:10 p.m.

Unfortunately, it appears that this particular bill will not likely solve the problems faced by the senior citizens and other tenants in the Sherwood buildings; it has come along too late. Last fall I asked the Minister of Housing and the Minister of Municipal Affairs (Mr. Grandmaître) to bring in emergency legislation to deal with the terrible social problems created by this form of demolition and conversion. I had hoped the Minister of Municipal Affairs would consider amending the City of Toronto Act the way the previous government did to provide a further period in which demolition control could apply.

This House was assured at one point by the Minister of Municipal Affairs that legislation would be introduced by the end of January. No legislation was introduced. I asked the government again, prior to adjournment, when action could be expected to provide the necessary enabling legislation to permit the municipalities to control such demolitions. I urged the minister at least to bring in the legislation before adjournment so that it could be sent to committee. No action was taken and the House adjourned in February. It was not until May 5, several weeks after the House came back following the adjournment, that this bill was brought into the House.

Bill 11 does not deal with the overall shortage of affordable housing in Toronto or outside it in other parts of Ontario. It will help to deal with the emergency situation faced by people with limited incomes, particularly senior citizens. Our goal must be to create a situation where there will be adequate senior citizens' and other low-cost housing accommodation available so that this kind of restrictive legislation will no longer be necessary.

There are a couple of aspects of the legislation that concern me. In particular, I am concerned with the procedure established under the bill. The bill establishes that if someone is dissatisfied with a decision given by the municipal council concerned, he can appeal the decision to the Ontario Municipal Board. From there, if one of the parties is not satisfied with the decision of the OMB, he can in turn appeal to the cabinet.

I do not know whether the minister realizes how time consuming this process could be. I fail to see why the government is adding one level of appeal on top of another. I can see that an appeal to the OMB might be permitted to protect tenants or landlords from capricious, unfair or arbitrary actions by a council. I do not think municipal councils generally act in that fashion, but protection with an appeal to the Ontario Municipal Board could be justified. However, there can surely be no justification at all for an appeal to the cabinet of the province. This is a needless level of appeal that will achieve little or nothing other than to delay proceedings and create additional costs, upset and tension for the parties involved.

If we analyse all the various appeal processes, it is quite conceivable that proceedings that might be started when this bill comes into effect, probably this fall, will not be completed until after the act expires in 1988. I urge the minister to consider very seriously, at least at committee stage, a revision of the procedures and processes so that this additional level of appeal to cabinet is removed.

While it requires amendment, I am prepared to support the bill because I believe it does provide needed emergency relief for a situation that affects many tenants within Metropolitan Toronto and other municipalities throughout the province.

Mr. Mancini: I will make a short comment to the honourable member who just finished. He may recall that the honourable gentleman who was his predecessor was encouraged to take action on many occasions when he was the Attorney General to provide protection for tenants who were going to lose their tenure for one reason or another. That honourable gentleman may have even mentioned the same address or a similar address in a similar situation. We stood where the member stood just a few minutes ago addressing the government of the time and it refused to do anything about it.

I want to remind the member of that and let him know that this minister is taking action. While the member says he is supporting the bill, I thought his speech was exceedingly negative in view of what had happened in the past.

Mr. McFadden: I did not intend my speech to be negative. I believe we should all be positive in this House. I was trying to be constructive in suggesting an amendment to the bill that will make it work better, to which I am sure the minister will be listening. My point was to point out a social need and to suggest ways in which that need might be met.

The buildings the honourable member was referring to are in the Bathurst and Eglinton area. Sherwood Avenue is a considerable distance from there.

Mr. Mancini: I am from Amherstburg.

Mr. McFadden: I did not expect the member to know those buildings. I would be happy to show him around. Since my election in May 1985, I have written and spoken to the minister with regard to the maintenance of the Bathurst and Eglinton buildings as well. I welcomed the initiative of city council and the provincial government to get on with maintaining those particular units.

The point I was getting at, and perhaps the point the member refers to as being negative, is my concern to come up with solutions in the long run that will increase the supply of housing and give tenants choices. They will not have only one choice, namely, staying in the unit they have for fear that if they look anywhere else or move out they will not find anything. That is the reason I support this particular bill. We have to find some way to protect those tenants who are being threatened with eviction and have nowhere else to go. In the next couple of years, I hope that issue can be resolved and they will find other suitable accommodation.

Ms. Gigantes: I rise to join this debate with a great sense of outrage and anger. For more than a year now, the Liberal government has promised measures that will protect what is left of our existing stock of rental accommodation. I do not think this bill does that. I am appalled at the way this government has delayed bringing in the measures we now have before us and the fact that we learn the Conservatives are looking to send the bill to committee, which will delay it further.

6:20 p.m.

I raised questions earlier today concerning one address in Ottawa, 180 MacLaren Street, known as the Bonaventure Apartments, which have provided 90 units of affordable rental accommodation for residents of Ottawa for the past 25 years, roughly speaking. Those people have been under siege for the past two years. Their landlord has been after them to get them out of that building so he can turn it into what he is advertising in the yellow pages of Ottawa newspapers as an apartment hotel. He calls it the Bytown.

I heard him on the radio this morning before I left Ottawa. He was explaining that units renting in the affordable range will become apartment hotel units that, if fully occupied during the month, will bring in about $1,200 a month to our enterprising landlord. This situation is but one of many that have occurred regularly month after month and year after year in the city of Ottawa.

I heard an earlier speaker on this bill -- in fact, it was the housing critic for the Conservatives -- saying that in the city of Toronto alone thousands of units have been lost in recent years. With a population one quarter that of Toronto, Ottawa has lost thousands of units in affordable rental housing during the past few years. The critic for the Conservatives is not aware, perhaps, that it has not been through the process of condominiumization. Ottawa did develop a condominium control bylaw which said that when the vacancy rate was lower than three per cent no affordable rentals should be turned into condominiums. That has not been our problem.

Landlords have found other ways of freeing up units and turning them into something besides rental accommodation affordable to ordinary households. Those methods have been renovation, demolition and construction of the same number of units but units that will fetch a much higher price on the housing market. There has been severance of rental row units, on which we now have an inadequate policy from this government.

The greatest of those problems has been renovations. We have seen time after time in Ottawa a landlord get a building permit to undertake a major renovation, a renovation that according to the law would be such that he would require vacant possession. Then what does he do? He goes in, sands the floors, paints, puts a chandelier in the dining room, if there is one, and ups the rent 300 bucks. That has been the consistent pattern in downtown Ottawa during the past few years.

Let me tell members what else that means. It does not just mean that people are forced to pay higher rents; it also means there is a wholesale flight, an emigration, a refugee movement from our downtowns. It means the people who are forced out of affordable rental accommodation in the urban cores of our major cities are forced to move, sometimes outside of our regional municipalities. In case after case that I have followed, people have had to move right outside the regional municipality of Ottawa-Carleton to find accommodation they could afford.

That is not without its public cost. In social terms, we are driving a whole class of people, a whole economic class, out of our urban centres. We are going to have urban cores inhabited by only the wealthy. That in itself is going to create problems for which the public will pay. I do not have to enumerate them, but they will include crime and they will mean the underuse of our infrastructure in the urban cores -- the schools that are empty, the parks that are empty and the community centres that are not used -- because families will not be able to afford to live downtown.

Further, when families and individuals are forced out of the urban core, where do they go? They go outside to the suburban areas and even to the extra-suburban areas, and there they need services. They need transportation services, recreation services and school services. Who pays for them? We pay for them. We paid for them once in our downtown urban cores and now we are going to sit by and watch while private entrepreneurs change the type of holding they have from affordable rental into unaffordable rental. We have to pay a public cost, not only in social terms, as our cities change, but in physical terms because we have to provide services for people who are forced to be refugees in their own city.

This bill is not a bill to protect affordable rental. It is a bill that says a landlord may apply to a city council, and if city council does not give him approval to turn it into unaffordable accomodation, then he can go to the Ontario Municipal Board. If the OMB does not give him approval to turn it into unaffordable accomodation, then he can go to the cabinet. If the cabinet feels so inclined, it can send it back to the OMB.

How many low-income and moderate-income tenants are going to sit through month after month of this kind of attack by landlords to determine whether they are going to be able to stay in their affordable homes. No, they are going to be frightened.

I have heard a lot today about sensitivity to these problems. Any member who has actually watched what happens to tenants when they get that eviction notice, has seen people burst into tears and feel fear when they know the housing market is not going to provide them with affordable accomodation and that they had better start, like last week, desperately looking to be the lucky household that finds some kind of rent it can afford out there in that market; any member of the Legislature who has intimately watched that process knows perfectly well that tenants in fear are going to leave.

They are not going to go in there, as did the tenants from 180 MacLaren Street with the support of their provincial member and the support of their local member of council, and hang in there and go into a full-scale war with a landlord. It happens very rarely.

In most cases, tenants would not even know their rights or if there were any for them. If there are rights in the Landlord and Tenant Act, they do not know them; if there are rights in the rent review act, they do not know them. Unless someone well informed comes along and helps them to organize and know their rights, they quit even before the battle begins.

Even when they get help, where are they going to be with this bill? There are places where tenants have managed to organize themselves and have realized that if they hang in there and ignore illegal eviction notices, the harassment and the advertisement that their home is now an apartment-hotel -- you name it; landlords try everything. Even if they are strong enough to withstand that, this bill does not effectively provide them protection.

It does not guarantee that somewhere along the way a council, an OMB or an executive council, or an OMB again, is not going to decide they are going to have to leave. Are the rents going to be lower if they have to leave next year if they go out looking somewhere else for rents? Not likely, and they know it.

In the case of 180 MacLaren Street, I feel very deeply that this minister and this government have betrayed a trust. The people who lived in 180 MacLaren Street until two years ago in some sense of security, had felt that with the election of this government and the commitments it had made to protect affordable rental accomodation they were going to be able to stay in their units, that there would be 90 units of affordable rental housing provided for residents of Ottawa at 180 MacLaren Street. Now that is not true.

This bill has been delayed to the point where they are not protected. The building permits are starting to flow out of city hall. This landlord is going to win unless the minister changes his mind and decides he is going to keep a trust with those people, instead of letting them go down the drain and throwing them out on to the streets with a housing market where many of them are going to be facing grievous problems.

Mr. Speaker: Does the member have any more remarks'?

Ms. Gigantes: Yes, I do. Would you like me to adjourn the debate?

Mr. Speaker: I think that would be in order.

On motion by Ms. Gigantes, the debate was adjourned.

The House adjourned at 6:30 p.m.