L223b - Wed 3 Sep 1997 / Mer 3 Sep 1997
SERVICES IMPROVEMENT ACT, 1997 / LOI DE 1997 SUR L'AMÉLIORATION DES SERVICES
The House met at 1830.
ORDERS OF THE DAY
SERVICES IMPROVEMENT ACT, 1997 / LOI DE 1997 SUR L'AMÉLIORATION DES SERVICES
Resuming the adjourned debate on the motion for second reading of Bill 152, An Act to improve Services, increase Efficiency and benefit Taxpayers by eliminating Duplication and reallocating Responsibilities between Provincial and Municipal Governments in various areas and to implement other aspects of the Government's "Who Does What" Agenda / Projet de loi 152, Loi visant à améliorer les services, à accroître l'efficience et à procurer des avantages aux contribuables en éliminant le double emploi et en redistribuant les responsabilités entre le gouvernement provincial et les municipalités dans divers secteurs et visant à mettre en oeuvre d'autres aspects du programme «Qui fait quoi» du gouvernement.
The Speaker (Hon Chris Stockwell): Further debate?
Mr Doug Galt (Northumberland): Bill 152 is one of the bills that's part of the Who Does What program, and it certainly does require considerable legislation. We've already been debating some of the bills: Bill 136 on the public sector transition; Bill 148, the city of Toronto bill; Bill 149, the fair municipal finance bill, and this one of course, Bill 152, having to do with the Services Improvement Act. It's a logical continuation of the Who Does What program.
For far too long we've had some very, very artificial boundaries around provincial government, around various levels of municipal government, and with that kind of tradition we have evolved into all kinds of duplication and overlap that really doesn't make all that much sense today. The previous government started talking a lot about disentanglement, but we're carrying it through under the Who Does What program.
Abraham Lincoln said, "You can't escape the responsibility of tomorrow by evading it today." We've come through years of evading change. It's time we faced up to the fact that change in the province of Ontario is indeed necessary, at the same time recognizing that it's not easy. I can understand why governments of the past stuck to the status quo -- it's warm, it's fuzzy, it's comfortable -- but we are getting on with change.
It's certainly no secret that the government of Ontario was indeed too big, too wasteful, too complicated and too expensive. We have a responsibility to ensure and to make government more simple, smaller, less expensive, less wasteful, and to increase efficiencies. That's really what the Who Does What program is all about.
It will result in savings for taxpayers. As a matter of fact, we're already seeing some of those savings with the reduction in the employer health tax and significant reductions in the provincial income tax, and as a result of those tax reductions, we are seeing a stimulus in the economy, a very marked increase in tax revenues. We're seeing spending is up because people know they have more dollars in their pocket. Car sales are up; housing sales are up; construction is up. Since March we've been creating in the province approximately 1,000 net new jobs every day. As you look at the jobs created across Canada, 56% of them are being created here in Ontario, so we must be doing something right.
The Fraser Institute reported recently, and I think it's rather interesting, on their monitoring of their tax freedom day. They reported for the first time in their history of records and living memory that tax freedom day is actually earlier this year rather than getting later. In 1996, the average family of four with two people working will actually be paying $1,600 less in taxes than they did last year. The unfortunate part is that they will be paying a total of some $29,000 a year in taxes, whether it be income taxes, property taxes, sales tax, luxury tax, gasoline tax, duties, and the list goes on.
It's also interesting to note that from 1985 to 1995, tax freedom day moved from May 25 to June 26, a full 31 days, one month or a 12th of the year. The previous two governments increased taxes enough that we had to work one extra full month just to pay for their increase in taxes.
We are in a financial crisis here in Ontario. It's interesting to note that the Chinese symbol for crisis is a combination of danger and opportunity. I see danger when I hear the federal government talking about balancing their budget and then saying, "How are we going to spend the surplus?" It's pretty simple. You pay off the mortgage. You get rid of some of that debt. There will be less interest to pay in the future, but that is a danger and they don't seem to understand that. With financial crisis there's a danger and an opportunity, but this kind of crisis also drives a change, and change is an opportunity knocking.
There's been one thing wrong, and I'll openly admit that, with the plan we have and the direction we're going, balancing the budget and the Who Does What program. That mistake and the thing that's wrong with it is that it's 10 years too late. It should have happened 10 years ago when the debt was a third the size it is today. The difficulty in bringing it under control would have been far easier and it could have been done when other provinces, when other states, when other nations were doing that very thing.
Bill 152, the Services Improvement Act, will allow the government to sort out Ontario municipally, where the services should be, and those services will be provided better and at a lower cost to taxpayers. It will provide an opportunity to see that the services are delivered at the level that makes the most sense. It will assist with the reduction in duplication and also with getting rid of some of that overlap.
Bill 152 will assist with the smooth transfer of responsibility. It means having the right level of government providing those services. Municipal governments can provide the services which are closest to the people most effectively.
I can give you one example. That's in connection with the inspection of septic tanks, which we looked at with Bill 107, and this is moving it into the Building Code Act. It will be a one-window approach to construction of new homes. There will be one permit, one code to work under and one appeal process. During the hearings on Bill 107, we were hearing regularly from homeowners, from municipalities, from contractors, from the public, "We want a one-window approach." Of course, to ensure that it will be done properly, there will be mandatory certification of the inspectors and of the installers. We will require that there's always a certified installer on site whenever construction is going on.
This bill also transfers the public health program, social housing, land ambulance activity, child care services, GO Transit. Some of the position that we've ended up in has grown something like Topsy and it really didn't make too much sense in the position we ended up in. The design that we're putting through with Bill 152 when it's finalized will make an awful lot of sense, that where the services are supplied and managed on a local basis, they're also funded on a local basis.
When we looked at this, we did an awful lot of consultation. In responding to the needs of the public, we went out with the Crombie study, which involved a lot of people, particularly from the municipal level, looking at what we should be doing in the Who Does What program. We brought in most of those recommendations and put them out as a paper to study, to look at and to move under the Who Does What program.
This also involved transition teams working closely with the Association of Municipalities of Ontario. They came back later with a very strong recommendation back in the spring. We adopted almost all of it, with one small item that we didn't bring in. That was the 5% that trustees would be able to put through as a school tax. We felt that wasn't in order.
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We have had in this whole exercise a tremendous amount of consultation. We have listened and we have responded in the areas that made a lot of sense to us.
Local government is indeed the best equipped to deliver the locally required services, it's best equipped to identify the local needs, and it's best equipped to respond to emerging conditions. Bill 152 will give to local governments greater control and accountability and will also give them the opportunity to be more autonomous.
Here at Queen's Park, sometimes you get the feeling that maybe there's a bottomless purse. At least that seems to be the way it was for the last 30 years. Just yesterday afternoon it was brought up by the member for Sudbury East about the mayor of Sudbury being concerned about the small amount that might be available for transfer and how he might have to go out cup in hand. I apologize that when I responded I mentioned Johnson, when in fact his worship was Gordon. But it exemplified what's been going on in the past with municipal politicians. One of their most important roles was to go out and lobby the province to get dollars to operate with, rather than looking at the kind of services they were delivering and coming up with the best way to manage their resources.
This kind of attitude, that there was a bottomless pit, a bottomless purse, money just magically appearing, was what has evolved deficits of $5 billion and $10 billion and $15 billion. The end result has been that we have a debt of $100 billion. We've gone through some three decades of budgets not being balanced. Although we might get some debate from one government, the government that followed that one certainly disagreed vehemently that the budget ever had been balanced, and they had a lot of billions to show a deficit where that budget hadn't been balanced in the late 1980s.
There are all kinds of examples of countries around the world that bit the bullet in the mid-1980s, from New Zealand to Australia to England to many of the states and to many of the provinces in Canada. That was a time that we in Ontario should have been doing the same thing.
Let me give you an example of a large community in Virginia. Ten years ago, Hampton faced a similar problem to Ontario: high taxes, an increasing debt load and businesses that were fleeing the community. They realized that major change had to occur. They turned the situation around. Downtown development now is surging ahead, property taxes are down and the debt has been cut in half. What they did was redefine the mission of that city government. They went from simply how to provide services with the money they could collect to managing the community's resources.
In the past, most management by municipal politicians has been how to lobby the provincial government, and they've been managing through silos of communities. We all have heard the stories many years ago when the fire truck went rushing down the side road only to come to the boundary and find that the fire was on the other side and having to stop there because, of course, that was the only place they would end up being paid.
Change means managing effectively all of our resources. Good management sees change as opportunity; it doesn't see change as a threat. Change may be described as opportunity dressed up in work clothes. Yes, change can be scary, moving into unknown territory and moving into uncharted waters. But Hampton, Virginia, with the financial crisis they found themselves in, moved to change, and opportunity was there to move them ahead by managing their resources. They looked at things like performance contracts and other modern management techniques. They have gone ahead with some 90% citizen satisfaction today and they are a leading public innovator in that state now.
It is also happening here in a community like Ajax, where they are also, I read, a leading innovator. They've turned their deficit into a surplus with no layoffs. They've used modern management techniques focused on quality, rewarded employee innovation, and chosen opportunity over threat.
If you don't grasp change and manage it, change will indeed grasp you and control you.
Bill 152 is an example of Ontario giving to municipalities the power and the tools to deal with a new and modern world, and certainly we are in a new and modern world. The Who Does What activity is sorting out those various roles, those responsibilities, so that we can eliminate waste and duplication.
Another area that we're looking at -- it's rather interesting if you follow the transfer and use of land ambulance. At first I wondered, and then I looked at the reason for doing it, and it fits in and makes so much sense as you use a land ambulance. It's an emergency vehicle and it ties in so nicely with the firefighting services that municipalities supply and also with policing that most municipalities have been supplying and that in the future all municipalities will be supplying. They'll work hand in hand. It's a local need. It supplies the local people with what they need day to day, and it just makes so much sense.
However, to oversee and ensure that there are standards throughout the province, the province will set those standards. The province will also be the dispatcher and see that ambulances are sent out. We'll also look at the very expensive air ambulance that is required in some of our more remote communities, particularly in northern Ontario.
The Who Does What exercise is indeed revenue-neutral. We've heard a lot of debate about this, but on a provincial level I can assure you that it will be revenue-neutral. Approximately $2.5 billion from the residential school tax, or roughly 50% of residential school tax, will be left with the municipality, which they can use for these services. We've heard an awful lot about downloading. This, if you want to talk about downloading, would in fact be uploading, I would gather. It's going in the opposite direction, and the province is taking over that portion of the education tax. At the same time, approximately $2.5 billion of services will be transferred to the municipalities, covering things like water and sewer, transportation, social housing, land ambulance etc.
For years and years, since I was on a school board in the 1970s, municipalities have been pleading to get education tax off the residence. We offered that 100% off the residence until AMO, the Association of Municipalities of Ontario, came back and said, "No, we would prefer only half of that, not all of it." We listened to what the Association of Municipalities of Ontario had to say and we responded. We not only responded to AMO but responded to those residents of Ontario who have been asking us for years and years to get education tax off their backs.
Bill 152 provides municipalities with the opportunity to do better, to see innovative solutions, to focus on customer needs and to reduce costs. It will do this by finding efficiencies, and they're best equipped at the local level to find those efficiencies. They'll do it by creating new partnerships, whether it's private-public partnerships or partnerships with neighbouring municipalities, and they will do it by finding new and innovative ways of doing things. We can indeed benefit from change and from reduced taxes.
The province has led the way. We have cut our internal costs by at least a third. We've reduced the deficit and we've reduced taxes. At the same time, we've absorbed the reduction in transfer payments from the federal government. That has not been easy but it's certainly something that this province has been innovative and has been able to accomplish.
Municipalities can also do the same. I'm sure that this fall, when the municipal elections are on, there will be voters out there observing what we have been doing and they will be looking to their municipal politicians and saying, "Can you in fact do better with less?" The innovative local politician will answer a very resounding yes and will follow the kind of example we have set in this province, not follow the kind of example of spending and borrowing that has gone on for the last decade which has put us into this position.
I am convinced that if the right people are elected there is no problem, that municipal taxes will be cut as a result of the Who Does What program and particularly because of Bill 152.
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The Speaker: Questions and comments?
Mr James J. Bradley (St Catharines): This downloading exercise is certainly apparent to all of the municipalities and the agencies that are affected by the downloading legislation. The government can say all it wants about some of its Tory friends who showed up at the convention, the Association of Municipalities of Ontario, but even many of the Conservatives who were there are absolutely appalled by the downloading exercise that is taking place. I know they won't want to have to defend Mike Harris and the Mike Harris government when they go into their municipal campaigns, because they'll have to stand up for the citizens of their own area.
For the life of me, I don't know why you're doing this. I look at ambulance service. To dump that on a local municipality, simply to isolate one, has to be a genuine mistake. What you're going to do is you're going to have the American firm called Rural/Metro come in and take over virtually all of these ambulance services. You're going to see the costs increase substantially. That is the record wherever it happens. When the provincial government ran it, sure there were gaps and there were problems and from time to time they're raised in this House and they're very legitimate to raise. But the framework is far better than turning it over to the hodgepodge that will exist in the municipalities.
The other areas that you're downloading through the auspices of this bill are equally of concern to me as a local representative and as a member of the Legislature because I see genuine consequences for our municipalities. I see the polarization becoming even more apparent. As municipalities are compelled to impose more and more user fees, people of modest means and their children will not have the same opportunities to access themselves of government services at the local level as will the wealthy who do not need those services, who will be able to afford those. That's just one consequence of this downloading.
Mr Len Wood (Cochrane North): Bill 152 is simply a bill that is designed to force property taxes up right across this province. It's a matter of Mike Harris and his Conservatives trying to balance the budget and give a tax break at the same time. Now they're saying we're going to have a revenue problem there, so we're going to pass off all these services that the taxpayers right across the province used to pay through personal income taxes on to property taxes.
I've talked to mayors and reeves and councillors throughout northern Ontario and they don't know how they're going to pick up the millions and millions of dollars that Mike Harris is passing off on to them. They're going to have to either eliminate a large amount of employees and a lot of the services they've been giving or increase taxes 15%, 20%, 30%, 40%.
When they're saying that people can do more with less, the facts are not there. The information is not being given out to the people. At the same time, they're saying you're going to have to look after your own ambulances, you're going to have to look after your own social housing. Some communities in my riding are going to be hit with a bill of over $500 for OPP policing. It was a Conservative government back in the 1970s that said if you want to get rid of your police force, the OPP will look after it. If you've got a population of less than 5,000, the taxpayers right across the province will be paying for it.
Now, with a new Conservative government, a Reform-Republican government, people are going to have to pay. Some areas they're going to have to pay as much as $700 a household for policing. Then you add on all of the other services they're dumping. Bill 152 is simply a matter of dumping on to the municipalities and it's a tax grab by Mike Harris to give the 30% tax break back to the wealthy in his province.
Mr Steve Gilchrist (Scarborough East): For those who tuned in in the last four minutes, the sky is not falling, the sky is not falling. The bottom line is that, contrary to the fearmongering and the idle rhetoric we hear from the other side after every bill and every rotation, the speaking order, the fact of the matter is we have mayors, and would-be mayors in the case of Mel Lastman here in Toronto, saying that Who Does What is not only revenue-neutral, he will guarantee that if he's elected taxes will not rise in Toronto.
We've had the same from the former Liberal MPP, the just-retired Bob Chiarelli, who has said that Who Does What is a wash. He has said that the transfer, not a downloading -- there's as much uploading as there is downloading and the members opposite know that. It's a complete dollar for dollar transfer, an absolute wash. The Premier has said that and I'm going to take him at his word because the kind of fearmongering we've heard for the last two years hasn't turned out to be true.
My seatmate, the member for Northumberland, has very carefully presented a précis of this bill and has detailed how it is purely and simply the technical means through which this transfer can be accomplished. The bottom line is that the municipalities will now have the tools to more efficiently manage their affairs. Areas that by definition are really of only municipal interest will now be transferred 100% to their responsibility.
On the other hand, the subject of education which has vexed every municipal politician I've ever spoken to for decades, and every one of whom has called for the elimination of education from the property tax -- well, we've gone halfway there.
We also have the minister saying that in the years to come, as this province recovers from the lost decade of mismanagement and we reach balanced budgets, we'll get the last half of education off there. This is an important bill, and I give my support to it.
Mr Mike Colle (Oakwood): I want to congratulate the member for Northumberland for his overview. One of the things I'd like to point out in his overview that I disagree with is that he mentioned the fact that you should pay off your mortgage before you spend money. As you know, what your government has done is, from the outset it has based its whole fiscal approach on the premise that you can give away this tax cut before you balance the budget.
In other words, you've given away up to $5 billion and you forgo that revenue before you balance the budget. That's the critical mistake you've made. Because of that $5-billion shortfall, your government has had to engage in exercises like downloading because your books could not be balanced, given the fact that you're forgoing $5 billion in revenue. So you've been engaged in a variety of different exercises like the downloading where you want to get rid of certain items on your balance sheet and eventually push them down to the municipal balance sheet.
Really, at this state I know there was a disagreement between you and your fellow colleague from Grey-Owen Sound. Whereas you agree that you're a 100% believer in the revolutionary rhetoric, at least some members of your party do not believe 100%. They are questioning and really at this juncture nobody knows how much their tax bill will be. Can you predict what the tax bill will be like in your municipality, considering the dramatic changes? I don't think you can predict that. If you can, please tell us what the tax bill will be in your municipality.
Mr Galt: Thanks to the various responders, the member for St Catharines, the member for Cochrane North, the member for Scarborough East and the member for Oakwood.
It's very kind of the member for Oakwood to pay me a compliment, that he followed it and agreed with a lot that I had to say. Unfortunately, he headed off on to one point where I have to disagree with what he responded on. He talked about paying off the mortgage and certainly that's a logical thing to do, to pay off the debt once you have some surplus rather than looking for some other way of spending it.
There's no question if you look at the increased tax revenue that we just wouldn't have that increased tax revenue if the income tax cut hadn't been made. It was explained to me, not by the party, not by the Common Sense Revolution, but by economists when I was knocking on the door campaigning. They talked about the Laffer curve, something I had never heard tell of before, but once you go over the top of that and start down the other side, once you increase taxes, revenue falls. There were all kinds of examples of that during the last five years in particular, at least 1990 to 1995. Once you give some of that tax back, it stimulates spending and it also ends up that by stimulating the spending improved tax revenues occur. It just necessarily follows, if you follow through that kind of thinking in economics, that's the way it happens, and they talk about it as a Laffer curve. I'd suggest you look that up and see how it occurs.
You commented also about predicting the property tax bill in the fall next year. Of course you can't predict that, because we don't know who is going to get elected and how they are going to like to spend money and how they are going to enjoy taxing the poor property owner. It's up to them. We'll ensure that it is revenue-neutral, but it depends who gets elected.
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The Speaker: Further debate?
Mr Sean G. Conway (Renfrew North): I want to join the debate on Bill 152 standing in the name of the Minister of Community and Social Services. The so-called downloading issue is one that we all face. I was interested to hear the previous speaker from Cobourg address the question. It is an interesting fact for me that many opposite talk about this issue as though the playing field were level everywhere in Ontario. If it were, if the province were one big Cobourg or if it were one big Whitby, then I suspect this would be a much easier matter. The difficulty is that like the Dominion of which we are a part, the province is very uneven in terms of population, in terms of wealth, in terms of a number of key factors.
I want to say something as a former education minister in respect of the current government. I'm sorry the Minister of Labour has left, because she'll know more about this than I suspect anyone, probably myself included. But where I thought Mike Harris showed some real guts -- where he was a man apart from Bill Davis, Frank Miller, David Peterson, Bob Rae -- was on this whole question of educational finance.
Like a good iceberg, there's so much more of that under the waterline, but when I heard the original deal, I thought, "You've got to like that Mike Harris, because he is going to war with the all-powerful teacher federations, and that proves to me that he's got more guts" -- other words come to mind -- "than Bill Davis" or all those other people I mentioned. There's no doubt in my mind that when this original package was designed, the key piece of it was education, and not just the economics but, of equal or greater importance, the politics.
I think the previous speaker is right to point out that the government of which I was a part, the government of which Mr Laughren or Mr Silipo or Mrs Boyd was a part, have many sins for which atonement is forever due. But sins don't just attach to New Democrats and Liberals. On the education front, no greater public policy change was effected in this province than that made in the mid-1970s when the Davis government decided, after four or five or six years, that the so-called unbreachable expenditure ceilings would be lifted and that local school boards would have the right essentially to spend according to their local capacity to tax.
When that decision was made, wealthy school boards, not all of them, but most of them in southern Ontario, entered a new opportunity. A whole new spending profile unfolded, a whole new collective bargaining environment ensued, and we were off to the races. We had a sterile debate here through much of the late 1970s and all of the 1980s. Remember, some of you who were around, the so-called 60% funding formula? "When will the provincial government go back to the good old days when it paid 60% of the total education bill?"
We paid 60% of the total bill back in the early 1970s when there was a cap. Whether you were in Toronto, in Ottawa, in Rawdon township, in Hastings county or in the Ottawa Valley, there was a formula, an unbreachable ceiling. You couldn't spend beyond that, and your revenue was made up of three sources: provincial grants, local residential taxes and local industrial and commercial taxation. But when the Davis government, under enormous pressure from the teacher federations about 20 years ago, took that cap off, education spending took on a very different characteristic than it had had in the previous few years.
Now we get to Who Does What. As a former Minister of Education who, like Mr Silipo and everyone else, wrestled with this, when I saw Mr Harris announcing 18 months ago the old education deal, I thought: "You've got to like Harris. He's got more backbone than I had."
Mr Gilles Pouliot (Lake Nipigon): You'd never admit to that.
Mr Conway: I'm admitting to it publicly. But, you see, where the backbone is involved is in the following respect: If you're going to do what everyone wants, which is to have quality education in the classroom with parity reasonably around the province, you've got to go back to the decision Mr Davis made in the mid-1970s, and it's a lot more complicated because if you want to have education as the centrepiece of the trade, you've got to do something about the fact that the two largest urban municipalities in this province have, in relative terms, enormous local wealth, and on the industrial-commercial side, I might add, more than anywhere else.
That has been the bedeviller in this debate for the last 25 years. Not very many people understand that. I was here for 10 years and I didn't understand it until that first briefing came when those very good people in the finance branch of the Ministry of Education sat the new minister down and said: "Well, now, Minister, here it is. This is the advanced course." After a couple of hours, I wanted to crawl away and never come out of my hole. But not Mike Harris. He's a tougher, braver man than I. So presumably he's got a plan, and the centrepiece of the plan and a big part of the plan is, as far as I can tell, going to war with the teacher federations. I don't know how you do it and not trigger that combat.
I don't mean to be fearmongering or mischief-making. I think it is a reality, and as somebody who was beaten up by those good people in the teacher federations, having lost more than I ever won -- again I say to myself, "I've got to like that man Mike Harris, because he's going to do what Davis and Wells and Conway and Peterson and Silipo and Rae couldn't or wouldn't do." It will be news, important news in Willowdale and Rockcliffe Park, I can assure you, very important news.
When I saw my dear friend Hazel take the poor Premier down in the first round of the 15-round fight, I thought: "What does that tell me about the backbone of Mr Harris? Hazel just took him out in round one."
Interjection: And she's 75 years old.
Mr Conway: And she's 75 years old.
I just want to make the point that this business about reforming education is a little more complicated and a little more sensitive than most people understand, for a lot of good reasons. I will be interested. He's not here tonight, the judge, the esteemed member for Ottawa-Rideau, His Honour Garry Guzzo, he's in the papers most weeks now in Ottawa and he has figured it out. Garry knows what long hand is reaching into the local wealth of Ottawa-Carleton. I see this weekend in the Ottawa Citizen there are all kinds of stories about all kinds of schools going to close down, and yes, there will be more, because there is no easy, painless way to do this -- except one, in the short term, and here I want to be a confessional again. Harris and Eves have luck almost as good as Peterson and Nixon in this one critical respect. When we took office in 1985, and I have to say again --
Mr Pouliot: With our help.
Mr Conway: -- with your help and, to be perfectly frank, with much more help from Frank Miller than anybody else. When we took office in 1985, there were a couple of things that I remember. One, we inherited a fiscal plan of the Harris-Miller government that called for an end-year deficit of approximately $3 billion. Hard to believe, isn't it? That was beyond the pale of the terrible 10 years. When we took office in June 1985, we inherited a fiscal plan that had a deficit projected in the neighbourhood of about three billion bucks. It wasn't the first multibillion-dollar deficit of that first half of the Tory decade, and I'm not going to be bold and take you all through that tonight, but when I hear the endless palaver about the 10 lost years, I always think about that $3-billion deficit that we inherited -- for some good reasons, I might add at another time.
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But we were lucky in a way that Mike Harris and Ernie Eves were lucky. The economy was growing at a much more rapid rate than had been called for, projected. So the old coin kept rolling into the treasury at a rate that did make Bette Stephenson and Frank Miller fulminate, as they ought to have fulminated, because our luck was a lot better than their luck just 12 months before.
I noticed in this year's budget that revenues for the year just ended, the fiscal year that ended on March 31, 1997, the province reported approximately $2.3 billion more in revenue than was called for in the May 1996 provincial budget. My guess is that for this fiscal year, the year that'll end next March 31, on the basis of everything I hear revenues will be about $3.5 billion above projections. My guess is Ernie and Mike are going to be tempted to do what Bob and David did 10, 12 years ago.
When I hear the declaratory statements out of the first minister at AMO -- and I tell you, he was nothing if not declaratory: "This will wash. There will be no loss. I guarantee it" -- I think there's only one way he can guarantee it, and for the next year or two he will have enough money by means of which he can keep that guarantee. He is at this very hour, the chancellor of our exchequer, swimming in excess cash. He's not the only one.
I see that the other day in Washington the General Accounting Office, which last year projected that this year's US federal deficit would be $150 billion, has now revised the figure down to somewhere in the range of $48 billion to $52 billion. The financial press this week is now indicating that Her Majesty's Dominion government up in my part of the province, up at Bytown, may in fact be in a real surplus situation very soon, with the beneficial factors being higher than projected growth and lower than expected interest rates. So the magic is working in Bytown, in Hogtown and in Foggy Bottom down in Maryland, lest anyone think that there is a particular elixir that has stimulated the financial genius of old Toronto.
But that's my guess. My guess is that our declaratory Mike is going to solve his short-term problem by just opening the gullet of these municipalities, on the one hand, and opening the public purse of our provincial government, which I will bet will have at least $3 billion more in the purse than has been projected. You know, if you've got $2 billion or $3 billion extra, you're going to have some manoeuvrability. Trust me, it gave us some manoeuvrability that, in retrospect, perhaps we ought not to have had. But it doesn't deal with the long-term situation.
My friend from Hastings and I sat in a session in Kingston a couple of weeks ago, and so did our friend Mr Rollins from South Hastings.
Mr E.J. Douglas Rollins (Quinte): Quinte.
Mr Conway: Quinte. Great place, Quinte. I've got lots of stories about Quinte. There were other members there as well, but some of the people on the administrative side who attended that meeting I have known for a long time and they're not, in my experience, fearmongers; they're not, in my experience, partisans. They brought to that table data that I thought were very nearly unimpeachable. I think particularly of the Frontenac presentation. These are people who've been around this question of intergovernmental finance a lot longer than any of us in this room and they are simply incredulous. They have no idea how these numbers add up.
I was reading the other day, as I usually do, the Cobourg Daily Star, where a certain Doug Galt is on the front pages, as he sometimes is. It is interesting because, according to the Cobourg Daily Star of Friday, August 22, there are a number of municipal leaders who are equally incredulous about Dr Galt's recitation of the data.
But I'm prepared to give this a chance. My county in Renfrew, which does not have a very strong tax base, is telling me that no matter how you cut this, this is tens of millions of dollars that they're going to have to find. I repeat something I've said before. In my county, the largest in the province, population 95,000, running from Arnprior to near Mattawa and out to near Bancroft -- just to give you an idea, that's like Toronto up to about Barrie and down to London. That's the empire that is Renfrew. In that empire, the largest single landlord is the provincial government. I don't think there's anybody who has turned their mind to the question: Who's going to pay the taxes for the biggest single landowner in my county?
You've heard me go on about these roads and these ambulances, and I've used this in question period. On a good weekend there are tens of thousands of people in Algonquin Park and, as we found out this summer with that tragic incident where that young boy was very nearly killed, ambulance services are important. Who's going to pay?
I can't wait to see how this scheme is going to work. I've checked what the minister has had to say, I've checked with local municipalities, and I'm not getting any answers whatsoever. I don't doubt there are answers, but there are a lot of questions that remain to be answered.
I want to come back to the centrepiece on education -- on educational finance particularly. I, for one, will watch very carefully. My guess is that what you're going to have to do is establish a formula and the formula, with some adjustment for large versus small, rural versus urban, north versus south, is going to go back to a formula that says: "This is the recognized expenditure for an elementary student in the province. This is a similar recognized expenditure for a secondary student, whether he/she be in Etobicoke, Exeter, Renfrew, Barry's Bay or Bancroft, and that's it. We are going to fund on that basis."
If that's what you do, God help you if you're the member for Etobicoke West. God help you if you're the member from Rockcliffe Park, Ottawa-Vanier. God help you if you're the member --
Mrs Helen Johns (Huron): God help the kid from Huron the last 20 years.
Mr Conway: The member makes a very good point. The history of empire is everywhere and always that the smaller, poorer win out, don't they, Helen?
Mrs Johns: Kids all deserve the same education.
Mr Conway: I couldn't agree more. You have embarked on a course of action that seeks that as its ultimate and beneficial end, and I will sing a Te Deum of praise to that end. I will watch carefully to see what instruments are developed to give it effect.
This, I have to believe, is the centrepiece, but everything I hear lately, everything I hear from people inside the ministry -- they're very professional and I only go to the odd little session where they talk about the new developments -- tells me that King Mike is backing away from the fight. King Mike, who that famous day about two years from this past spring, said at the Royal York -- remember? -- "I'm not very good with numbers."
It turns out that he was basically telling the truth. The numbers are not pretty.
Interjection.
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Mr Conway: The member from Brampton wherever says something inaudible.
Again, I will be very patient. I am going to be very patient. I just simply conclude my remarks tonight by saying that the only way this can be made to work, in my view, is either you keep your word on the original retooling of educational finance and take all of the pain that comes with that, and there will be a bipartisan group of former ministers of education quietly cheering, or you will lose your nerve, you will back away, you will dip into that multibillion-dollar windfall and hope and pray that it gets you through the night until at least the end of 1999, all of the turmoil and bad public policy not withstanding.
The Speaker: Questions and comments?
Mr Pouliot: You will understand, of course, if I'm a little hesitant to be on my feet responding to the insight, to the comments from a person who is regarded by many on all sides to be perhaps the most eloquent, the best orator in this House.
The member for Renfrew North spends a lot of time at the local library here and some time in the real world as well. He's a very busy person. He will confess, Bishop Conway, or profess to know about education, having been there in the capacity of the premier spokesperson, that of the Minister of Education, and yet in a lower tone, readily admits, confesses again, that he doesn't know as much about public financing. But since bishops must make a ruling at times, he does point a finger to the government of the day and accuses them of a grab extraordinaire which is about to come.
He would have wished to have more time, because he wanted to mention that $7.7 billion, slightly less than the overall cost of education -- elementary, secondary and post-secondary education, not factoring in the teachers' contribution -- comes from the coffers, from the general fund, and the other $7 billion, and that's what he wished to focus on, comes from the pockets of the taxpayers -- 50% -- and the largest two municipalities, those of Toronto, which is richer in assessment and, second, Ottawa, are about to get it big time.
We will have time to follow through on what the most distinguished and eloquent Mr Conway has begun to say. It's one component of the downloading. I thank you, Speaker, and thank the member.
Mr Jim Flaherty (Durham Centre): I listened with interest to the comments of the member for Renfrew North. I don't share his pessimism with respect to the ability of people to change and institutions to change in our communities.
I, along with other members of the Legislature from Durham, had the opportunity last week to meet with our public utilities commissions, and there are many of them in the Durham region. They have their buildings, and in fact they have 40 commissioners in the one area of Durham region. They took the initiative. They realized that we need less government, fewer politicians, as we promised to do when we were elected in 1995. They don't have their heads in the sand. They're not opposing change. They're saying, "We can do better," and they're trying to create ways of doing that, generated within our own community of Durham region. That's just one example.
The member for Renfrew North talks about teachers and the education system. We see in Durham region in the month of August teachers taking their own time and spending their own money to be trained and upgraded in their training by the Durham Board of Education, which is renowned throughout Canada and around the world for its ability to train and upgrade teachers. These are teachers adopting the new curriculum, being positive in their attitude, saying that we need change, saying that kids come first, saying that there are revenues in the system that need to be concentrated in the classroom. Unlike the opposition, they understand the need to reach higher and do better.
A lot of this, I think, is a matter of attitude, of being positive, of realizing that we need to concentrate limited resources in the proper places to benefit our children and our grandchildren. This involves some restructuring and some change, which many people in our society accept and view positively.
Mr Colle: I certainly appreciate the comments of my colleague from Renfrew North. As you know, back in the early 1970s there was a famous CBC documentary called The Best...Fiddler from Calabogie to Kaladar. I think what we have here today is maybe best spinner from Calabogie to Kaladar.
He made a very eloquent case for the people living along the Opeongo trail who are going to be asking him, and they're going to be asking a lot of the MPPs now, whom they never asked before, about the property tax bill. For the first time in recent history, that is going to be taken to account to the MPPs, because in essence, in an attempt to supposedly figure out who does what, everybody is now saying, "Who is on first?" They don't know who is doing what any more.
What started off as being a complete eradication of education from the property tax, as you know, has now gone back to a half eradication. There's a lot of confusion along the Opeongo trail. There's a lot of confusion throughout Ontario.
I think the member for Renfrew North is right in saying, "God help all the members," because you're going to be taken to account for that. I noticed that when the member said, "God help the member for Etobicoke West," the member's father showed up in the gallery, the esteemed politician-administrator, who knows what it means to balance the books at the local level.
Over the generations, local politicians haven't done a bad job, but this government is now saying: "We have all the answers. We have reinvented the wheel and this wheel, although it's square, is better than the round one you've been using." I think everybody is from Missouri in saying, "Show me." That's what they'll be saying: "Show us the tax bill."
Mr Tony Silipo (Dovercourt): It's certainly always a pleasure to listen to the member for Renfrew North. You will understand when I say it's particularly so for me when I hear him talking about education, as he has done tonight, at least the financing parts of it, because he and I share some common ground on that in that we were both for some period of time responsible for some of the policies and some of the decisions made in that field, including with respect to the area of education financing.
I also just want to note for the record that I recall a certain member for Etobicoke West continuing to ask me from time to time when I was Minister of Education how we were coming with our then promise of returning provincial funding to the 60% level, a quite accurate reminder by the member for Etobicoke West in those times.
When I put that against where this government says it wants to go, by removing education off the property tax, as the member for Renfrew North talked about, we of course note that far from being that kind of a direction, what this is in this bill and in all of the actions that surround it in the other legislation to come, and indeed in all of the pieces that they do without having to resort to legislation, it really is not doing what we ourselves, when we were the government, were not able to do, certainly what the Liberals, when they were in government, were not able to do, which is to remove education off the property tax. Because that's not what you're doing.
What you're doing is you're compounding the situation. You can claim at the surface level that you're taking 50% off the cost of education, but in fact what you are doing is just compounding the problem by shifting down the cost, as you know you are, of many other services, the social services and many of the other areas, which at the end of the day are not going to mean that people are going to have any clear idea about who is responsible for what. What it will mean is higher property taxes for the average household, all of that so you can just keep your promise of reducing income taxes. But you will have done it at the end of the day at the cost of increasing property taxes and that, quite frankly, will be the result.
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Mr Conway: Just a couple of responses. Mr Flaherty from Durham Centre left the impression, and from my point of view a wrong impression, that as far as he was concerned, I was one of those who felt that Ontarians were somehow resistant to change. Nothing could be further from my view of the genius of Ontarians. I think Ontarians have over the decades shown themselves to be a very adaptable, flexible population.
I must say, and here I probably do differ from some members of the current administration, the Ontario that I thought I knew was a province that was given to evolutionary change. My curse now may be that I am, despite my occasional outburst, a moderate man living in immoderate times.
Interjection.
Mr Conway: I'm serious. One of the things I note about our politics is just how incredibly immoderate it is becoming. People talk about revolutions and scapegoating, and some of it I understand. It's been a very gut-wrenching and difficult time. It's not just what you find in Ontario. But when people talk about revolutions, they're not talking about the kind of evolutionary change that I think has made Ontario the kind of place it has been. The trouble with revolutions is that people get hurt, glasses are broken, and there is a lot of breakage around. I say to Mr Flaherty, change in Ontario, absolutely: consistent, creative but generally evolutionary change. I hope we have not abandoned that very important, positive part of our patrimony.
Mr Silipo: I want to join in this debate and I probably should note for the record that I'm doing the leadoff presentation for our caucus, although I'm not sure that I will actually go the entire hour.
I do want to put a few things on the record. Bill 152, which we are now in the second day of second reading on is in some aspects, as I think I heard one government member describe it, a technical bill, in that it sets out what's going to be shifted here and there. I will go through some of the pieces of the bill in the course of my remarks, but we know that what it does and what it mainly serves as is the frontispiece for the download exercise that this government is embarking upon.
We know that some time ago Mike Harris and his government decided that part of the way in which they were going to find money to pay for their 30% income tax cut was by shuffling around responsibilities between the provincial level and the municipal level. In that equation, education plays a big role because part of the exercise that the government we know is engaged in is reducing the public contribution that they now make and that governments previously have made to education. Beyond the cuts that they have made so far, the almost $1 billion that they have already cut, there is more to come.
Beyond the area of education, which as we know is funded today some 60% from the property tax base and 40% from the provincial coffers directly, beyond the education costs and the education portion of the property tax, there is of course the rest of the property tax system, which municipalities are now responsible for levying, and it pays for a whole array of services.
What we have here is at the surface level an exercise by this government that says, "We're going to try and sort out the responsibilities and who pays for those responsibilities between the province and the municipalities." It sounds like a pretty noble endeavour. It sounds like a pretty good and useful objective. What politician among us here at the provincial level or at the municipal level could disagree with the notion of simplifying for the average voter, for the average resident, for the average taxpayer -- the one taxpayer Mike Harris used to remind us exists, and I note no longer quite so readily reminds us of -- how could any of us be opposed to the notion that that one taxpayer should know in a much clearer fashion than exists today who is responsible for what and who pays for what?
Part of the problem with what the government is doing is that the exercise is not about sorting that out. It might have been at some beginning stage of the process. I don't quite believe that's what it was even in the beginning stages, but there are some who might believe that's what it was about when it began. I should say there are undoubtedly some pieces of it that will result in a clarification of roles, but when you look at the picture, when you look at the overall impact, when you look at some of the major pieces, let alone the whole big picture result, what you see and what you have at the end of the day is not a simplification of the roles, is not a straightening out of who is responsible for what and through what tax contribution we're going to fund and pay for certain services versus others. What you have instead is a clouding of those areas, but more significantly, what you have at the end of the day is a push on to the property tax base not only of costs that shouldn't be there, but also of more costs than exist on the property tax base now.
Of course government members from the minister to the Premier, to any of the government members right on down, will continue to tell us that this at the end of the day is going to be an even wash. They'll point to their transition fund, they'll point to their community reinvestment fund and say, "Yes, we understand that in the trade back and forth there are going to be some inequities, but we've got a fund of money set aside and we're going to use that to balance off any of those inequities that exist."
I don't buy that, and more important than that, many people out there don't buy it, from the general public to the local politicians who have to implement these changes and who have to try to explain to the voters and the residents in their areas. We see growing day by day a worry and a concern about what is going to happen. Why is that? Because what we are seeing is that people are beginning to understand more and more clearly that this is not about an even trade, is not about a sorting out of responsibilities; it is about downloading some $1.2 billion of costs that are currently borne by the provincial level of government on to the property tax base.
Even if you factor in the famous community investment fund which as it now sits is about $570 million, you still have a shortfall of almost $650 million that municipalities will have to pick up. That's just in this trade among some of the issues and services that are covered by Bill 152. That's without even beginning to look at some of the other changes that are coming with the reassessment and the move to market value assessment, or actual value assessment as the government wants to call it and as the bill and the legislation call it, so that I guess is what we need to call it. But we know that what that will be is another way to increase property taxes in many areas of the province. Certainly in the area I represent, that's what's going to happen.
That's what we see, that's what we're going to be finding and that's what municipal politicians are now beginning to realize more and more, and I think with greater and greater interest. As they get closer over the next couple of months to the municipal elections, they are beginning to realize that they are going to be the ones who have to carry the can for Mike Harris and company, and they're beginning to say, "Sorry, folks, it's not me who's making this decision, it's not us who are causing these increases to happen, it's Mike Harris."
I have to say that I believe the government members were a little bit surprised by the reaction they received at the AMO conference last week, because I think that they didn't expect quite the kind of outrage, quite the kind of result, quite the kind of response that we saw from the AMO representatives.
These are local politicians, by and large, as you know, conservative-minded folks, many of them not just small-c conservatives but big-C Conservatives, and they almost unanimously have said to this government: "Sorry, Mike, not us. We may agree that restructuring is necessary" -- and they do agree that restructuring is necessary. "We may agree that some cutting has to be done" -- and some of them agree that has to be done. "But we're not going to be the front person for you. We're not going to carry the hatchet for you. We're not going to be out there on the front lines defending your actions any more."
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That's the message I heard pretty clearly from the AMO conference. I'd have to say it's got some of the government members just a little bit nervous because I'm sure they also heard the same message over the summer break as they were back in their ridings and talked to many of those same politicians but, more importantly, I'm sure they heard many of the same things as they were out talking to the residents in their own ridings.
The results we saw in the polls, whatever value one attributes to polls, I think have kind of shaken the government members a little bit and have pointed out to them that people out there aren't all buying any more this notion of the Common Sense Revolution, that it goes against the grain of the way in which Ontario has evolved and should continue to evolve, has in fact evolved to this point, in recent memory certainly, with the exception of this two years that we've now had Mike Harris at the helm.
While Ontarians, I think, fully understand and are prepared to accept the need for change and are prepared to accept within that even the need for less money to be spent by governments at all levels, as much as I may not agree with some of those views, that's the reality that I think is out there among the general public that they're not prepared to accept.
What I think the government is hearing more and more strongly from people across the province, as reflected, as I say, in the AMO conference but much more broadly than that, is that people are not prepared to see for the sake of budget cuts, and certainly they're not prepared to see for the sake of an income tax cut, basic services like education and health care being put on the chopping block to the point where those same basic services are put at risk. It's not a question of people not being prepared to look at innovative ways or looking at ways to provide those services more cheaply; it's not a question of people saying, "Yes, the status quo is acceptable and we want no change at all." It's not that at all.
I think all of us to a person would agree that one resounding point of agreement across the province is that people not only are prepared for change, people understand the need for change and all of us as politicians understand that we have to be responsive to that. We have to understand and we have to be responsive to that sentiment out there, but we would be very wrong if we read that sentiment to mean acceptance for the kind of gutting of our basic services of health care, education and social services that the Mike Harris government is bringing about the province.
When we look at Bill 152, we see not just that message so clearly being reflected, but also the vehicle for doing that -- at least one of the vehicles for doing that. I know that when we talk about some of these bills, which relate so directly to the government's overall fiscal agenda, and when those of us here on the opposition benches, certainly here in the NDP caucus -- I speak for ourselves; I'll let the Liberal members speak for themselves -- take the time to berate the government, to bring them to task about what they are doing at the broader level and tie the piece of legislation to that issue, some of the members not only become uncomfortable but become a little bit irritated and they say: "You're not talking about the legislation. You're not talking about the bill that's in front of us."
I want to make sure in the time I have that I actually speak directly on the bill, as well of course as the issues that I've already touched on and that I will come back to in terms of how this bill relates to the rest of the government's agenda.
Let's take a look at Bill 152 and what it does. As I've pointed out, the basic premise and the basic backdrop to the bill, the reason why this bill exists is to allow Mike Harris to put in place a part of his downloading exercise which will result in certain costs being pushed down on to the property tax base in exchange, as he puts it, for some of the education costs coming on to the provincial level. As we've pointed out, we don't believe that's going to result in an even trade and at the end of the day we're going to see more costs being put on to the property tax base.
What is happening through this bill? One of the first areas that is being affected by this bill is health care. The first section deals particularly with respect to the changes to the Ambulance Act and the Health Facilities Special Orders Act. What does this mean? This means we're going to see the push of a large part of the growing cost of health care on to the property tax base.
You've got at the same time going on, remember, the closing of many hospitals across the province, planned and some to begin in the next year to two years. You've got, on the one hand, Mike Harris reaping the profits through the provincial coffers of the savings as some of those hospitals are closed and you've got, on the other hand, the cost for ambulance services being pushed down to the local level.
Of course, one of the things we've heard throughout this debate in terms of this whole exercise -- I'm not sure I've heard it in the debate on this bill yet -- is that what the government is doing and what has led the government to this point is the work that David Crombie did. David Crombie, it's interesting enough to note, did not recommend the push of ambulance services down to the property tax base; he recommended the opposite. What you're doing is not taking his advice on this one, but what we've got is that not only will this mean a push down on the property tax base of the costs of ambulance services, but we're going to have a further dilution of the services that we have in place now.
We're going to end up with a situation with greater confusion, not less confusion, across the province as we have potentially the up to 800 municipalities all involved in the delivery of services eventually for ambulance services. You're going to have municipalities being responsible for funding of it, the province still trying to keep some control of it and the municipalities having to work out a whole morass of cross-border issues. In the end, rather than having greater clarity, what we're going to have instead is greater confusion among the public about who's responsible for what.
At the same time, while all of that is going on, there's certainly no guarantee that as both emergency and non-emergency medical transportation costs increase, the quality of those services will be maintained. We know that right now we have 172 ambulance services across Ontario. Those are run in a multitude of ways, in a variety of ways. Some are privately operated, in fact the majority of them are run privately, some by municipalities -- we have the exception certainly here in Metro of that being the case -- some directly by the ministry and some in a variety of other ways.
But the important thing is that there are not 100 different stakeholders involved in terms of the different jurisdictions, but at least a limited number of jurisdictions, and what you're going to be doing is taking a system that, by and large, is working and you're going to sort of spread that out into a thousand different pieces.
It reminds me very much of the concept of fixing something that isn't broken all, the government says, because they need to have this piece of funding into the mix. Well, I don't know who it is who's been asking for this because what you need instead of what you're doing is greater coordination of ambulance services. The last area you want to have some confusion in when people are in need of services is an ambulance service. When there is an emergency, the last thing you want is confusion about how that service is going to be delivered, about how it's going to be provided.
What you want is to be able to have greater coordination among areas when you get outside of the larger metropolitan areas to be able to know that people can get to the hospital when they need to get to the hospital or to the nearest health care facility as quickly as possible. We're talking here about a service that's to be provided in emergencies. We know that as you close more and more hospitals across the province, the travelling distances for those ambulances are going to be greater than they are today. What you're likely going to have developing is a situation in which there will be fewer of those, because if municipalities can't afford to provide the services at the same level we are providing those services today, then it's going to be the general public, and it's going to be the public in need during an emergency that is going to suffer.
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To tie this back to how the government is going to treat people who deliver these services -- again we're talking about a very specialized area here -- it's interesting to note that the government has rejected the retention of sector bargaining when the responsibility for ambulance services is going to be downloaded to municipalities.
We know that the municipalities here have said that if they have to pay, then they want to be able to control the service. But again what you're going to have at the end of the day, it seems to me, is a greater scattering of services rather than a bringing together of those kinds of services. That's one of the areas in this bill I have some concerns about and I'll be interested in hearing more about this as the discussion continues.
Let me talk briefly about another area that is also in this bill. One of the things this bill does is to affect regulations of septic systems. A responsibility that is currently under the Environmental Protection Act is being shifted to the Building Code Act. On the surface, the reason for doing this seems quite reasonable. I understand the rationale of the government is to be able to say that when people apply for building permits and they need to put in place a septic system, they should not have to deal with two different pieces of legislation and two different bodies etc. That part of it seems to have some logic.
But we know that in transferring responsibility for the approval of septic tanks to municipalities, you're going to have a growing situation where municipalities simply won't have the resources to do that job effectively. Then you have a situation again in which this is one of the services where we will see a reduction in the quality of services and a reduction in the protections that now exist under the Environmental Protection Act, because I don't see a reflection in the new legislation of the same kinds of protections.
If it was just a question of shifting those responsibilities and putting them under the building code, one could accept that. One could even come around to seeing the logic of that. But when it is a reduction of the kinds of protections that exist now for the average public and the impact that is going to have on our environment, that is something I, for one, would have some problems with.
Let's look at another section of the bill: schedule C. I know the Minister of Community and Social Services has much vaunted this particular move and has said, "We are going to make it mandatory for municipalities to provide their 20% funding to child care and for child care across the province."
On the surface it sounds like a very good idea, but you know what? This is something I know a little bit more about because I spent some time in the Ministry of Community and Social Services, and this does not resolve the problem that exists in our child care system. Simply mandating that municipalities will continue to pay for 20% and saying municipalities have to do that is not going to get you any big winners across the province.
You might resolve the one or two situations where you have municipalities that continue to waver between, should they continue to provide funding or should they not continue to provide funding? Quite frankly, the case for having child care has been made and will continue to be made locally and across the province by people who believe in and know the need for the service.
This is just again taking a big problem, trying to fix a little bit of it and then saying, "Look, we've fixed the whole problem." If you had the courage, what you should be doing in this area is going completely in the other direction, and that is taking responsibility at the provincial level for the funding of child care.
But we know that is not consistent with the direction you're moving in. One of the first changes you made, when you became the government, in the area of education and early childhood education was to stop the early years program we had begun as a government. That program was going to be a bridge between child care and kindergarten, provide a program that is already the norm in many countries of Europe, particularly, that provides an early start to youngsters, and instead you are moving in the opposite direction.
We have seen it with respect to the opening of the doors to privately run child care centres and we see it as just tinkering. It continues to create problems between the ministry, the province and municipalities. It does not deal in any useful way with the issue of child care.
To deal with the issue of child care, you need to be moving in terms of recognizing the value of public funds being invested at the provincial level in that important area and you need to continue to see -- you need to start to see because you haven't even begun -- the social and pedagogical value of doing that for our young people, for our children, for our young children particularly. At the very least, if you're not prepared to go to that step, recognize that child care is a service that should be funded from provincial coffers and should not be tied to the whole area of welfare. While there is clearly an overlap and for many people it is tied together and that part of it needs to continue to be there, as we want to try to get people off the dependency of welfare, we also have to provide child care, that is only one part of it.
We know that a good child care system needs to continue to be provided with adequate funding from the provincial level, but it also needs to be set on the premise that it goes far beyond simply the tie it has to people on social assistance, that it is a service that is needed for all working families and all working parents, whether their only income is the money they get from their social assistance cheque or whether they are making $50,000. It is not the income that makes it relevant or makes child care a real need; it is the fact that people have young children. It's a fact that today, either by choice or by need, in most two-parent families both parents are working. It is also part of the reality of our society today that where you have more and more single-parent families, the only real way those single parents can be out there working in the job market or in education or training programs, getting themselves back into the job market, putting themselves in the position where they can take care of themselves and their children, is in knowing there is a good child care program for their children during that time.
That can't be done by having this continued situation of child care staying in limbo. It is an area that, as I look back at our years in government, I wish we had been able to move further on. One of the regrets I have is that we did not. This government is simply taking a small piece of the big problem that exists here and saying, "We're going to make sure that municipalities now take up this particular piece," which they are already doing now. I'm not sure whom you're going to please with this one. I'm not sure what the problem is that you think you're going to fix by doing this.
Schedule D of the bill deals with public health units. We know that right now public health programs are cost-shared 75% by the province and 25% by municipalities outside the Metropolitan Toronto area, and 60-40 province-municipality here within Metropolitan Toronto. We're looking here at a budget of about $211 million in terms of the provincial costs, and we have these costs now being put down on to the local tax base.
Again one could say some of those perhaps make some sense. Some of those costs, as we know and as I've said, are already being paid by the property tax base, but when you push this kind of system down, essentially you're going to have a situation -- when we get through to clause-by-clause of this bill, and I'm assuming that at some point in committee we'll be able to point out some of the problems that exist as this is being done -- where at the end of the day you're going to put municipalities into a bit of a squeeze. This is one of the areas where right now, because of the joint funding that exists, there can be some pressure put on where it's necessary, but in fact an understanding among municipalities and within each municipality about the need to provide for these services, to provide the variety of services that is being provided through the various public health offices that are overseen by the local public health boards and the even more local entities that exist in some parts of the province, certainly here in Metropolitan Toronto the local board of health, and the various individual advisory boards in different parts of the city and the cities.
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What you're going to be doing by pushing these costs down on to the property tax base is putting more pressure on the municipalities with respect to their ability to maintain that level of service. Again, it's the same kind of thing that we are seeing in piece after piece of this. We're going to see it here I think in some ways, and ironically in an area where again the track record across the years has been that this is one of the costs that one can make a case should be more and more rather than less and less in the provincial area of responsibility in terms of funding. If you were going to move in any direction, this was an area where you could make a good, strong case for moving the funding more towards the provincial level rather than the other way around. But of course in the great equation of things that the government had to come up with, this was also one of the pieces, at least to the tune of some over $200 million, that had to be pushed down so that they could make the balance sheet look equal.
Another piece of this bill, in schedule E, deals with GO Transit. Again, the basic premise that's being put into law here is that GO Transit is going to be paid for by the municipalities. That again is an interim measure. I understand that the minister is going to apportion the costs between the GTA municipalities and Hamilton-Wentworth, because we know that here in the GTA, as the minister is getting ready presumably to move towards the Greater Toronto Services Board, we will then see a realignment of those responsibilities and those costs.
We know that the government is intent on shifting the responsibility for GO Transit to the Greater Toronto Services Board, something which by and large I think is actually not a bad idea, and I'll undoubtedly have more to say with respect to the Greater Toronto Services Board on another occasion. But we know that here we have the government pushing down these costs, interestingly enough, before they know exactly what the situation is going to be in terms of the overall costs, and more importantly on this one, in terms of the overall structure. While we've seen an indication from the government that the Greater Toronto Services Board is the direction they're going to be moving in, we have yet to see the legislation. We have yet to see what's going to happen, and I'll be looking forward with great interest to what is to come on that.
The last section of the bill is the one in schedule F that deals with social housing. Here again we have financial responsibility for the provincial share of all social housing being transferred to the municipalities. Again, in a similar fashion, we've got the minister -- the Minister of Municipal Affairs and Housing in this case -- giving himself the powers to determine on his own the costs and to allocate them to municipalities. The costs are being pushed on to the upper-tier level in particular, and the minister of course is giving himself the power to be able to push them on to the lower tier, to impose at least a cost-sharing formula among lower-tier municipalities where he, for whatever reasons, believe that's the case.
We know that in this area of social housing there continues to be great interest and great debate. Why? Because, as our leader pointed out just this afternoon and as we've been saying all along in this debate, if there is an area which we can categorize as a bit of a sham, this is it. This is an area where the real costs that are being shifted down are nowhere near being on the table. We know there is some $536 million or so that's estimated to be needed for repairs on the public housing stock. As municipalities realize that they are going to be saddled with those responsibilities, with those costs, I don't think they're going to be so thrilled about the idea of taking on the public housing stock and being responsible financially for that.
We know the concern that exists, as we saw reflected particularly by the large urban centre mayors. When they asked the government for an analysis of those costs, the government said, "Yes, of course we will do that." Here we are weeks later and that study has yet to begin. Here we are weeks later and we're no closer to people understanding the real impact that's being shifted down on to municipalities in this area. Here we are weeks later and we're no closer to understanding that in fact what's being shifted down is nowhere near an even trade. Perhaps that's what worries the government, that municipal leaders are beginning to realize, are beginning to understand, and that's why the mayors of the large urban centres asked for that analysis, for that independent study, to say, "Show us what the real cost is, including the repair costs."
If, as I believe is the case, and more importantly as people who understand this area of services and are experts in this area are pointing out to us increasingly, the costs here are not just the annual costs that are on the ledger now but have to also take into account the state that the housing is in and the repair costs that are going to be needed, that if you disregard those, you can hardly say you're providing an even trade in dollars, and when you factor those in, if you do it in any kind of a fairminded way, you've got to deal with the $500 million that you haven't factored in, well, then, you can understand why municipalities begin to get just a little nervous about this notion of simplification, about this notion of just buying the government's notion that it's all going to be an even wash. They know that it's not, they know that they can't explain it to their electors out there and they know they are not going to be prepared to play that role on behalf of Mike Harris and his government.
And so when you look at each of these areas, we have to come back to the basic message and the basic direction of what Mike Harris is doing through this piece of legislation. It's simply dumping costs on to municipalities. It's simply saying that at the end of the day we're going to see the property taxpayer end up picking up a much larger cost, a much larger share of these costs than exists today.
I have to say I've found it really interesting to see what the government has done, what the Minister of Municipal Affairs and Housing and the Premier have done with respect to how this whole area relates to particularly here in the Toronto area. As a member from the Toronto area, I want to just spend a couple of minutes on this issue.
We have heard and we had heard for some weeks now the growing concern that existed particularly within Metropolitan Toronto about the huge download that was taking place, but it wasn't until your own transition team, set up to put in place the new megacity here in Metropolitan Toronto, some time in the early part of the summer pointed out the shortfall. Yes, there was a shortfall -- first thing they pointed out -- and by the way, that shortfall was some $450 million of additional costs being pushed down on to the property tax base.
All of a sudden, because the transition team said it, the government could no longer ignore it. If it was the member for Dovercourt saying it, he was being partisan, but when it was the head of the transition team whom you appointed, a team of hand-picked people that you appointed and your minister appointed, you could no longer disregard that reality that we had pointed out to you and that others from the municipal level had pointed out to you for weeks and weeks before then.
What did the minister and what did the government do? They decided that even at the risk of alienating some of their friends in the 905 area, they were going to now spread the costs of social housing, public health, social services and ambulance services across the GTA.
Again, at a surface level, I have to say that makes some sense. If you're going to have this crazy situation in which you're going to insist that these services be paid for through the property tax base, then there's some logic in saying they should be paid for through the property tax base of the whole area that benefits from those services.
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I know that municipal leaders here in the GTA of course don't agree with that. Those within Metropolitan Toronto tend to say, "Yes, that's the way we should do it." Those outside of the Metropolitan Toronto area, in the surrounding area of the GTA, tend to say, "No, no, no," because of course they don't want to see their property tax base having to pick up some of these costs.
The reality is that there is probably some useful truth somewhere in between those two positions. There is some truth, as I see it at least, to the notion that says many of the services that are provided geographically within the area of Metropolitan Toronto are in fact provided not just for the benefit of residents in the Metropolitan Toronto area, but indeed are provided for the benefit of and are used by people in the greater Toronto area, particularly in those parts of the GTA near to the Metropolitan Toronto area. There is some logic to the notion that says if you're going to have these costs at the property tax level, then the property tax base for those services needs to be done at the whole GTA level.
I look forward with some interest to the members from the 905 area -- my friend Mr Clement who is here from Brampton, and others, members from Mississauga -- trying to explain that and trying to sell that and trying to defend that in Brampton, in Mississauga, in York region.
I will just say this to them tonight: If they're having any community meetings and they would like participation from the third party, I would be happy to be there and to listen to what their residents have to say. I look forward to listening to Mr Clement's explanation and his defence, because word has it that he's not particularly happy about this direction that the government has taken.
Mr Pouliot: It's a tough sell.
Mr Silipo: Some of my colleagues are saying it's a tough sell. It's got to be a tough sell, especially when you began this whole exercise with the notion that if anybody was going to get it in this process, it was going to be Metropolitan Toronto, and you were going to do everything you could to protect the 905 area.
I say to the people in the 905 area who may be following this -- although I hope to God they've got better things to do at this time of the evening -- I want to say very clearly that I have nothing but the greatest of respect for people who live in the 905 area. Many of my family now live in the 905 area. They too have made the transition from 416, the Metropolitan Toronto area, out to the great 905. It isn't them that I am in any way being critical of; it is what this government has tried to do. They now hold every seat in the so-called 905 area. They had made sure that in every action they have taken in this downloading, in all the changes that have come about -- you will recall all the debates and discussion we've had in this House with respect to the megacity, a major change in Metropolitan Toronto with very little consultation. But of course there's an understanding in the 905 area that no major change would come about without real discussion. I applaud the application of that notion to the 905 area. That's what should have been done here inside Metropolitan Toronto as well.
Here you have an interesting situation where government members have said to their local politicians and their local allies in Brampton, in Mississauga, in Oshawa, in York region: "Don't worry about it. None of this stuff is going to create a problem for you. We've got it worked out so that if anybody is going to suffer at the end of the day, it's going to be those folks down in Toronto. Some of our folks there are going to have it a little rough, but we're prepared to sacrifice some of them if we have to, but not here in the 905 area." Now my colleagues, at least from within Metropolitan Toronto, are going to be able to look to their friends and their colleagues outside and say, "You guys are going to have to share some of this pain too."
We can have some fun with this, but the important point and the serious point that needs to be made here is that this is not the way in which you make good policy. This is not the way in which you go about making decisions. The bottom line here is not how you make a bad decision more palatable all around or how you make everybody bear the brunt of a lousy decision. What you do, if you have the courage of your convictions, is admit that this is not a very good decision, that this is not a very good policy direction, that having the costs of social services, public health and social housing picked up in greater quantity now through the property tax base is not good public policy, is not making the responsibilities between the province and the municipal level any clearer, any better. It's making it more confused and it's making it worse. It means that at the end of the day people will be more confused rather than clearer about who is responsible for what, about who is funding what, and at the end of the day it means that everyone, through their property taxes, will be paying more.
What does that mean? Why is it that when we come back to that notion -- it's not just some kind of esoteric notion about what should or shouldn't be paid for through the property tax. It's because we know that, regardless of the many systems that have been put in place over the years to try to deal with some of the inequities, a property tax base remains the most unfair system of taxation we have. It's one of the most regressive, probably on a par with the sales tax.
That's what's wrong about shifting more and more of the costs on to the property tax base. It means that at the end of the day, it's families of average means and modest incomes that are going to be paying more. By lowering income taxes as the government is doing, and for which reason all of this is happening, it means that at the other end of the scale it's people who are better off, people who are richer, to use a simple term, who are going to be benefiting. So you've got tax reductions for the rich and tax increases for the rest of us. That's the Mike Harris world. That's the Mike Harris reality. That is the Mike Harris revolution: tax cuts for the richer citizens, tax increases for the rest of us. One gets a cut in the income tax, or benefits more greatly from that, and the rest of us get stuck with an increase in property taxes.
Now, we'll hear lots of stories. My friend from Scarborough -- we'll hear lots of stories about politician after politician standing up during the campaign for public office throughout the province who have all been saying: "Don't worry. We'll be able to fix this so that there's not going to be any increase in taxes."
Mr Gilchrist: You trust municipal politicians, don't you?
Mr Silipo: It's not a question of trusting or not trusting municipal politicians. By and large, the people who are speaking I have a great deal of respect if not trust for. It is that the choices those politicians are going to have to make at the end of the day are going to be: Do they increase taxes? Do they cut services?
Mr Gilchrist: Or do they cut waste and mismanagement?
Mr Silipo: Waste and mismanagement. The favourite catchphrase of this government is you can cut waste and mismanagement. Of course you can, whatever little is left of it. They seem to forget so conveniently that school boards, municipalities, and all other public entities for that matter, have been cutting their budgets long before they came to the provincial table. They have been cutting their budgets long before the Common Sense Revolution was even an idea in Mike Harris's head. Municipalities, school boards, children's aid societies, all of them have been living with less. All of them have been making those cuts; all of them have been trimming that fat. There's not a lot of it left.
What you're dealing with now are really some basic choices. Do you cut services? Do you increase taxes? Those are the choices. What this government is saying is: "We want to be on the side of cutting taxes. Therefore, municipalities, you deal with the nasty stuff. You be responsible for making the hard choices about cutting services or increasing property taxes." That's what this exercise is all about. That's what this is all about.
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As I came back from the summer break, for the first time perhaps in the last couple of years I had some sense that people were not just understanding -- because that understanding of what the Mike Harris revolution is all about started a long time ago. That started back with Bill 26 a while ago and just kept building slowly but surely, and with the whole debate on the megacity here in Metropolitan Toronto we certainly notched that up a few steps and people understood what was going on.
But finally, we saw the reflection a little bit in the public polls, a little bit in the nervousness that came with the members of the government back from the summer recess. We are seeing that now even in the area of labour relations. The Premier just days ago was saying: "Bill 136 is sacred. This is it. We're doing it." Now he and the Minister of Labour are saying, "Yes, we're prepared to talk to representatives of labour," something they should have done before they introduced this legislation. We'll see what comes out of those discussions; we'll see if there is any truth to that.
But I can see Mike Harris now beginning to feel a tad nervous and saying, "If there's any way we can appease labour, any way we can put a soft face on this" -- and Mike Harris the other day at AMO was doing the same kind of thing, reassuring people, giving his own word that at the end of the day this would be an even trade. Well, time will tell.
As the member for Renfrew North pointed out, perhaps the few members of the government who know better than the rest of us what the real projections are for the next couple of years know something they're not prepared to tell us yet. Perhaps they see a rosier picture in terms of income to the province coming in, so perhaps they see that they can crank up the $500 million in transition assistance a little beyond that.
I don't know what it's going to take. I don't know what the government's going to do. But I do know this: If the government doesn't do something, if the government simply persists in this downloading exercise through Bill 152 and the other pieces of legislation that we've yet to see, at the end of the day we're going to see increased property taxes. There are no two ways about it. We're going to see all that being done so that Mike Harris can keep the one promise. If all other promises are put aside, the one promise he will want to keep and is intent on keeping is the 30% income tax cut.
As I look back at the Common Sense Revolution, the basic premise of that promise was made on the point that "Everything we're going to do here is going to create jobs." In fact, they promised 725,000 of them. Then I look at what's going on, even with the economy picking up here in Ontario and throughout the country, for which we are obviously happy. We are not seeing -- from the government's own figures, not mine -- job creation anywhere near those targets. We're not seeing it because jobs are not going to be created by the methods the government believes in. Jobs will not be created in the way the government says, through this trickle-down effect.
Having spent a few weeks this summer in another jurisdiction, I saw the way in which government can play a real role. When I was in France earlier this summer, one of the headlines on one of those days, August 21 -- I'll end with this. The headline was, "Aubry dévoile son plan emplois jeunes." That says, "Aubry," the Minister of Labour in France, "presents her plan for youth employment." There are 350,000 jobs being created in the public sector, with 350,000 to come in the private sector, by the government putting in funds on a cost-sharing basis with municipalities and with other local entities to create new jobs -- not to replace other jobs, to create new jobs.
That, as I see it, is one positive way in which governments that want to create jobs can take steps to do so, not by the kind of filter-down economic policies that we see from this government, pretending that by providing tax cuts people are going to go out and spend that money and create those jobs. They're not there.
You can point to job growth. I'm not for a minute saying that there isn't job growth. Of course there is. But the point is, what job growth, where is it, how much, and compared to what? At the end of the day we're going to see a situation in which the job growth will not be there, and we'll be there to remind Mike Harris and company, the smiling faces across the floor, that in their own words the whole reason for the Common Sense Revolution was supposed to be to create 725,000 jobs.
They didn't say, "We want to do this because we're ideologues who believe in shifting more money to those who are already well off and taking it away from the rest of the citizens." They said, "We want to do this in order to create 725,000 jobs." I don't remember the exact words because when they cleared out the desk, they also took the Common Sense Revolution, but I believe I remember correctly. On the first or second page, it says, "Everything being done is being done to create those 725,000 jobs."
Mr Gilchrist: Right on.
Mr Silipo: The member for Scarborough East says that's right on.
That's the promise that was made. We will see at the end of the day how close we get to that. I know they're not going to get anywhere near that amount. But what is sad is that by the time we get to the election, by the time the government has to account for its actions, we will have seen an Ontario develop where our health care system is in worse shape than it is today, our education system is in worse shape than it is today, our social service network is in worse shape than it is today, as thousands of people have already been pushed off any sense of support by this government; we're going to see support for our young people nowhere near the level it needs to be; and we're going to see people and families of modest means paying more taxes through increases in property taxes and user fees, and we're going to see, at the other end of the scale, people who are more well off, people who are already rich, being richer.
That's going to be the Mike Harris revolution. That will be the result of the Mike Harris revolution, not more jobs. While there certainly will be more jobs created than there are today, that began to happen even in 1995, when we were still the government, so let's look at things in a real context. The Mike Harris legacy at the end of this mandate will be an Ontario that is meaner than the one we've come to know, an Ontario in which the rich will be richer and the rest of us will be poorer, in dollars and in the services we have today. That's the result, that's the situation, and I think the people of Ontario are more than beginning to realize that that's the Mike Harris revolution.
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The Acting Speaker (Mr Gary L. Leadston): Questions or comments?
Mr Gilchrist: Once again we've heard from the soothsayers, seen the crystal ball reading more doom and gloom, more suggestions from the third party that the mandate we were given in 1995 was all wrong, that the millions of Ontarians who voted for us who read that Common Sense Revolution, who agreed there was a need to turn this province around, to give hope back to the people of this province, to give prosperity back across all the economic segments, were wrong. Well, to our colleague opposite, I suggest that forecasting and soothsaying is probably a field he should stay out of, because the last two years would prove otherwise.
The same negativism, the same doom-and-gloom message, has been spread from the opposition benches since day one, and what have we seen? Over the last few months we've seen the creation of over 1,000 net new jobs a day. We've seen a 22% increase in consumer confidence. We've seen an over 40% increase in housing starts. We've seen a record increase in car sales. We are seeing growth and prosperity in this province unprecedented in the last 10 years.
To our colleague opposite, it must be very tiring and frustrating knowing that your message has no resonance out there in the real world. The bottom line is that this bill is, as are all the bills we bring forward, very much part of keeping our promise to the people of this province, very much part of fulfilling the mandate we were given on June 8, 1995. The bottom line is that this bill increases the accountability of both levels of government. It fulfils this eight-month dialogue we've had on how we can disentangle the process and make municipalities more efficient, to ensure that property taxes will go down, not up. At the same time, we are honouring our 30% income tax reduction and eliminating myriad other fees and taxes. This is about keeping promises.
Mr Bradley: I enjoyed the member's speech. I think he was moderate, I think he was considerate, I think he made certain concessions where there would be some consensus in the province. But I should tell him that you can't concede anything to these people because they don't concede anything back. There's ideology and that's it with some members of the government caucus. If you concede anything, you're agreeing with what they say and they think you're agreeing with everything. And here you were trying to be fair and reasonable, particularly for the people watching.
You were quite correct in assuming, whether intended or not -- I prefer to think not -- that the result of this will be a further polarization economically of our society, where the wealthiest and most powerful people will be better off, even better off than they are today, and those of modest income and modest means will be worse off. In the short term perhaps you think you will have achieved something because you'll have reduced certain expenditures at the expense of those people, but ultimately the social problems will creep in.
When people are desperate, when people are so vulnerable, when people are so concerned, they undertake actions that they wouldn't normally undertake. Unlike perhaps the relatives of the member, they don't have the Tory connections, the rich-guy connections, don't belong to the Albany Club, so they can't go to the Albany Club and ask, "Would you hire my daughter?" or "Would you hire my son?" They're not part of that hierarchy. Therefore you're going to see those people fall into greater and greater despair while your smiles simply increase for the rich in this province.
Mr Pouliot: I too learned a great deal by listening intently to the discourse of the member for Dovercourt. Mr Silipo, the member for Dovercourt, is always balanced, always seeking equilibrium. He is focused and analytical to the point of being meticulous. The audience, the people of Ontario, will benefit from his balance, from his wisdom.
Most unfortunately, he was constantly interrupted, because the people across saw themselves under siege. He reminded them that if you take the credit, you also take the blame, that when the economy turns there will be a lot of vulnerable people, those who can't run as fast as the rich. He's right when he says it's the rich against us, that side against this side.
They're short $2 billion to date, and it will only accelerate by virtue of the tax cut. They will stop at nothing to recoup the $2 billion because they must satisfy the insatiable appetite of the well-to-do. So teachers, bang: "We'll pick your purse, we'll pick your pocket." Municipalities, you'll get the same fate.
They tell you it's a wash, that it's a break-even. Well, if the taxes go up in Manitouwadge and if they go up in more than 600 municipalities in Ontario, as they shall, it is not a wash. Nothing else matters. My taxes are going up, and they made it happen.
They say, "We know a lot about how market conditions work." There aren't two of them in the lot across the way who know that today, at the market close, the Standard and Poor's 500 price earning ratio is above 20 and the dividend yield is below $3.
Mr Galt: It was interesting to listen to the member for Dovercourt. It was a rehash of many of his other speeches, fearmongering and trying to create emotional concern among constituents. I can understand, coming from the third party, why he would want to create that kind of feeling out there. But we have candidates like Mel Lastman and Bob Chiarelli out there campaigning, saying it's a wash and that they're not going to increase taxes, and I think that's laudable on the part of those particular candidates.
You talk a lot about taxes and where they're going. I point out to you some of the taxes we've reduced: the business registration tax, for example, the employer health tax, the income tax, all savings for constituents. And we're still increasing our total revenues coming in.
I was a little confused when the member referred to some of the unemployment figures he was using, something about France being ideal with 13%. I just didn't follow the concern. When we took office, unemployment was 10.5%, and it's been falling. We're now down to 8.2%. Since March, we've been creating some 1,000 net jobs a day in Ontario. That's the kind of thing we've been doing. Across Canada, Ontario has been creating some 56% of those jobs.
He referred to consulting and concern about consulting. I don't know how much more consulting you could do than the David Crombie study. We brought in all kinds of municipal people. There was a thorough study carried out and we accepted most of their recommendations. Then we moved to AMO and the transition team, looking at that, and AMO came back to us with another recommendation. We listened and we responded. That's the kind of government you have today: one that listens, responds and consults.
The Acting Speaker: The member for Dovercourt has two minutes to respond.
Mr Silipo: I'll be happy to report back to the member for Northumberland on future trips to France this coming year and let him know about further developments in what's going on there. I was not in any way, as I'm sure he understands, defending the state of the world there, or any other parts of the world, for that matter. I was simply pointing out that there are different ways in which governments can go about creating jobs. I, for one, happen to agree that the actions being taken by the current government in France are going to result in those jobs being created. I don't see the actions of this government resulting in the creation of the jobs that they say are the ultimate point of all this.
Mr Speaker, I remember and I'm sure you remember the story of the person on social assistance who after the election said that the reason she voted for Mike Harris was because she thought workfare meant she was going to get a job. It took some people longer than others, but we discovered eventually that the workfare program, which was at the heart of the rhetoric the government put together during the election, was nowhere near the direction they were going to be implementing; that is, it's not through workfare that they're creating the move of people off social assistance.
Similarly, it's not going to be through the income tax cut that they're going to create the jobs. If the economy continues to pick up, as we all wish it to, then yes, jobs will be created. The government will not be able to point to the reduction in taxes as the cause for that. Undoubtedly they'll be able to take some credit, as they should, for some of the job creation, but they will also have to take the responsibility for the increases in taxes that this bill and all the other related bills will result in. That's going to be the sheer reality too.
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The Acting Speaker: Further debate?
Mr John Hastings (Etobicoke-Rexdale): It's very interesting to join in this monologue among three solitudes and it's very interesting to listen to some of the remarks from the previous speaker, the member for Dovercourt. In previous debates on economic subjects we have been condemned for ever proposing a tax reduction to stimulate the economy, yet on the other hand, we have the member for Dovercourt possibly using that significant tax reduction from his own salary as a stimulation for his nice vacation to France. It seems to me this mythology that still prevails around here, that tax reductions are for the wealthy and there is no money available for those at the lower income, clearly, if you look at the statistics, it's the reverse. In point of fact, one of the things that the opposition members constantly forget is the employer health tax that was instituted to replace the job killer we had before from the previous regimes.
I want to set the record straight. When we look at the whole subject of economic change and you look at the models around you, the member for Dovercourt quotes a very interesting example with France. Of the European Community, France has probably got one of the highest tax rates, one of the deepest structural unemployment challenges facing the common market countries, because they have got entrenched in their social system vacations of six and eight weeks for people who have been working for 15, 20, 30 years. Who wouldn't love to have such a system in place?
The side effect that is bringing forth is deep unemployment among young people. The member recites that this government hasn't been able to meet the challenges of dealing with the youth unemployment problem. If that's true with us, it's also true federally, because it's the federal initiatives that are supposed to be leading us out of youth unemployment.
I want to concentrate this evening on some of the general themes we've heard from members opposite regarding Bill 152, the Services Improvement Act. The general line or mantra that is taken is that you have two choices in this world in terms of dealing with these changes, what I would prefer to call the realignment of responsibilities, which many members of the Association of Municipalities of Ontario over the years have been asking for, either isolated examples or complete changeovers, so that they could do the job better. If you went back over many agendas and not just the new reality agenda which they had two weeks ago, you would see numerous requests for service realignment responsibilities by rural, intermediate, suburban and urban municipalities. There was that general theme when I was on council in Etobicoke: Let us get on with doing the job; yes, give us some base money so we can do the job better, but we can deliver the service.
The common theme you hear from members opposite is that in the new world of the Services Improvement Act, you've got two stark choices, and they are these: You either raise taxes or you cut services. Those are the bipolar extremes that members opposite talk about. They have nothing in between. There's not the conception of a possibility that you could do something better between those two stark choices. To me, it's a syndrome locking folks in on the other side. They can't break out of that envelope to see that there are other choices for keeping your taxes under control.
I'm surprised by some of the members opposite who have served in local government, that they don't themselves talk about their own experiences in terms of how you can increase or improve services, at the same time reducing or balancing your taxes. All you have to do is cite the many examples throughout local government in Ontario.
We could start, for example, with the city of Etobicoke. There is the example of public-private partnerships. I know the members opposite don't want to hear about some of these imaginative examples, some that work out well, some that do not, because they're stuck in this syndrome that there are only two ways of dealing with the Services Improvement Act, with the realignment of responsibilities: increases taxes or cut services. There is nothing in between.
Here is an example of a private-public partnership between the city of Etobicoke and a private placement agency in terms of providing better services at lower cost through the Olympium. In this particular example, the city of Etobicoke is going to earn itself over $1.5 million annually out of that partnership by allowing the private sector to build the facility for sports medicine. Members opposite would say, "No, you can't do that. The only way you could do that is to have the city or the municipality build the facility and increase taxes," because that's their first addiction when they're locked into this syndrome.
Addiction, that's what it is; that's what we're dealing with here. It's an addiction to tax increases, because when they were governing, that's the only way they handled the problem. There's a problem, so what do we do? Whether it's child poverty, whether it's changes in the correctional system, whatever it has to be, you just increase taxes and take in that amount from the private sector and spend it for the service.
The problem with that is that countless times, after they did this -- the Liberals' 65 tax increases, a large number by the more recent regime -- was the problem resolved? Was there a solution to the problem? Was child poverty ended? No. Did more moneys going for correctional services reduce the number of breakouts? No. Were people on parole more successful? Not necessarily. But their refrain constantly is, "You have to increase taxes." There is no other way of handling the new world, the new reality that even their municipal cousins, when they came to AMO, recognized. Maybe they didn't centre and concentrate on the new reality, but it certainly is evident in their broad-based thinking, contrary to what you get from the members of the official and third party opposition.
Where does this take us in terms of other examples in dealing with both no tax increases and maintaining services in a reasonably priced, affordable way? There is another solution. Many cities have gone to outsourcing their garbage collection. Imagine: outsourcing their garbage collection. That's another way.
A third way, and this is from the city of Windsor -- perhaps the member for Windsor-Sandwich would like, if she were here, to take a look at this example. I was surprised she didn't use it in her own remarks as an example of effective management at the city level in Windsor. What happened there is that there was a bid put out for winter road maintenance. Guess what? An in-house competition resulted in the city of Windsor saving $250,000 a year.
But if you look for that type of innovative, imaginative example from that economically booming city, what you get from the member for Windsor-Sandwich is that the only way you can deal with the new realities in Ontario is increase taxes. It's like the addict: "I've got to have another shot, a shot in the arm of a tax increase, or I'm not going to get through the night. Or if I can't have a tax increase, there is another way," -- and it's really imaginative -- "we'll have to reduce services. There's no other way of handling these challenges, or maybe we've got to do both." There's only that one prescription we've heard over and over and over: increase taxes or reduce services.
I'm surprised that members opposite, who come from a variety and background of experiences, wouldn't be able to come up with some good examples of how you can deal with these major challenges in today's Ontario at the local government level: entrepreneurial government. "Oh no, we couldn't do that. We've got to have lockstep procedures, process." No results. That's the type of government we probably would have from members opposite, were they running local government in Ontario: increase taxes, reduce services or have more bureaucrats; just spend more money to have more people.
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There's a problem: There's no other way out of any of this stuff. You can't think of public-private partnerships. They're illegal. You can't have innovative management in public housing. Oh, goodness gracious, no. We have the example of that when you look at the Services Improvement Act. There is the constant criticism that municipalities cannot ever deal with social housing, even when you put in over $250 million over X years, as we're going to do, that the municipalities will be able to deliver a better, well-managed, capitalized public property stock than we did at the provincial level
If you go back and look at the origins of public housing in Ontario, non-profit housing, it started in the community, whether it be a church, a legion or the local government itself. For people to use the refrain that you can't find effective ways of managing the challenge of realigning public housing or social housing or affordable housing is simply to give up before you even start.
For example, if the folks across the way wanted to criticize us for what they call the downloading, surely when they were in government, the NDP would have been the champions of this, which is a good example to me of how you manage your public housing stock better: involved the craft unions in a private-public partnership, as the international labourers' union in the United States has done, and used pension moneys of those members, approved by those members.
In another way there is an example of major public housing improvement in San Francisco and Buffalo, where the members, the folks who are living in those public housing units, were retrained to be carpenters, to be lathers, to get a skill, and consequently when they fixed up their own units they had greater pride of ownership in them, because they had done the work. You supply them with some of the capital, you give them training if they are interested. You can turn around public housing, not overnight but in three to five years.
The problem with public housing as it has been managed by the provincial governments, this one and others, is they have put money into public housing but they didn't manage to get real value out of how public housing stock was improved overall.
In my estimation, it is a complete blind acceptance to assume that some way or other local governments do not have the capacity, do not have the managerial competence to take on these challenges. They do. The problem is that we don't hear specific examples from across the other way, even in those ridings where the opposition members rule the day, because they have to assume the party mantra, which is increase taxes -- "My goodness, we could never cut a tax. I'm an addict; I can't go off that. What am I going to do?" -- or reduce services. There's no other way. Those are the only two stark choices.
I hope to God that in the new city of Toronto, when the new councillors are elected, when the new mayor comes to power next January, we will have a group of councillors who are not only accountable but believe in value for the tax dollars that are spent and will approach their responsibilities with some real imagination, looking at innovative ways of doing business in the new city of Toronto.
In my estimation, an amalgamated, unified city is going to require tremendous levels of imagination, tremendous levels of ingenuity.
The Acting Speaker: Member for Grey-Owen Sound, I'd ask you to remove whatever it is, the label.
Mr Bill Murdoch (Grey-Owen Sound): It's just a little note from Boss Hogg's helper and I thought maybe you should see it.
The Acting Speaker: I would ask you to remove it, please.
Mr Hastings: Speaker, does that mean I still have 10 seconds or whatever is left? Thank you.
I want to go back to the theme that we hope and pray that when the electorate goes to the polls, not in the new city of Toronto but in many of the new amalgamated rural areas of county government in Ontario, they will choose wisely, that they will choose politicians, local government people, who either have a lot of experience in containing tax challenges and/or new people who bring to the table a tremendous amount of imagination and innovation in working out all the problems and challenges a new amalgamated local government entity produces, that the people elected will choose good managers and will work with each other.
My major fear is that we will have candidates who will run on a motivation that, if elected, they will make very sure that things don't work out, so they can point to us in a year or so and say, "See, I told you so; this new city of Toronto, this new township, doesn't work, because we had to increase taxes; I had to get my addiction fix" -- the only solution to the whole problem -- or, "We had to do a service reduction; we had to do away with snowplow clearance on township roads for a month."
We see that in certain responses, very traditional, old-style-of-thinking responses, there's nothing between these polar extremes. I'm hopeful and prayerful that we will have people elected by an electorate who will look at the records of the people running in these new cities, in these municipal entities, who will cast a vote for innovation, experience and above all a little bit of imaginative cooperation, instead of what is constantly demonstrated across the way, that you have to have a tax hike, a tax addiction fix.
That isn't going to work out there any more, and the doom and gloom of the folks across the way, who can only predict that, "If you only kept things the way they are, everything would be okay" -- if everything is okay according to their version of reality, then how come people in the public, people that my colleagues and myself talk to, say: "You're on the right track. Make some adjustments here, but get the job finished. Don't tolerate tax inequity, tax unfairness, as particularly the Liberal Party espouses"?
I find it absolutely incredible that the member for Scarborough-Agincourt stands up here constantly defending the assessment status quo in Metro Toronto, that everything is just hunky-dory and we shouldn't be making any changes at all to commercial assessment, to residential assessment, because the folks in the suburban municipalities are really happy campers, spending higher tax dollars with lower services in the current regime.
I know the members opposite don't want to hear some of my remarks because they don't want to be associated with the labels, the monikers "tax addicts," "service reducers," the only two traditional responses. Then there is the usual rhetoric about the attack on the vulnerable, the disabled etc, when in fact what people really want today is a growth economy.
The changes proposed in the services improvement bill, the realignment of responsibilities that AMO politicians have been calling for, for the last 15 to 20 years -- they are now getting their opportunity to meet these challenges. I'm a little disappointed with a few of them who unfortunately have picked up the mantra, have been seduced by the mantra of tax addiction, increases and reductions in service. No other way to handle problems. Just increase and hike taxes. Yet the same group stands across the way and accuses us of reducing taxes to stimulate the economy, particularly these critics who talk about reducing taxes --
The Acting Speaker: Thank you, member for Etobicoke-Rexdale. The member for St Catharines.
Interjections.
The Acting Speaker: The member for Etobicoke-Rexdale, thank you. The member for St Catharines.
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Mr Bradley: I very much regret that because of the rule changes the member, on this very complicated and comprehensive bill, is confined to only 20 minutes. He just made the case tonight. I wanted to hear him give more, but there we are stuck with these new rules and the member is stuck with only 20 minutes on an extremely complex bill. I think you've made the case.
What you are going to see of course is that the property tax will increase. The difference between the property tax and the income tax is that the property tax does not take into an account an individual's ability to pay. The income tax does. That's the difference. So medium- and lower-income people are going to be hit hardest by property tax increases, while those who are getting the lion's share of the benefits from the income tax cut -- that's the rich and the privileged -- are going to be much better off.
I notice as well -- the member didn't mention this in his speech; I hoped he would -- that the government has now put forward a time allocation motion, a closure motion in effect, on the debate on the libraries bill, where you are taking money away from the libraries. The libraries, remember, are open to the entire public. Rich people can afford to purchase their own books, their own VCRs, their own tapes and so on, but modest-income people have access to the library. That's where you provide equality of opportunity.
I wanted to have something to say on that bill, even though my local library board, when they were consulting, invited only the Conservative members to meet with them instead of any of the other members from the Niagara Peninsula. I think that's an insult to members who are representing the area and I think it's unwise for them. The present they've got for doing this from the government, the effect the government members had, is that libraries are going to be very adversely impacted by all this legislation.
Mr Pouliot: With high respect to the member for Etobicoke-Rexdale, what a missed opportunity -- fully 20 minutes of government time to address the people of Ontario and to ease the pain, ease the anxiety, dispel some of the belief and the perception. Instead, the member chooses to grab a club where he could have used the full 20 minutes to talk about the key messages.
I want to share this with the member: What's this package all about? Simply put, it's about dumping on municipalities. That's what Bill 152 is about. It's about downloading the cost of ambulance, people in need going from point A to point B to have access to care. But you hit them in the pocketbook. That's what you're doing.
What about housing? Whereas it is not always in the best of shape, they take $476 million per year from the federal government for operating social housing. They pocket that money and they take the social housing units and they dump them on the municipalities. He calls this streamlining. He says, "We're giving you a chance to live, not a chance to die," and then he pretends to stab himself. I think he overdosed long ago, the first day he came to this place. This is not opium that you smoke with your eyes. The very opposite. He grabs a club and he accuses both official opposition parties of being parties of gloom and doom.
We would like to remind you, with respect, colleague, that we love it when things go well. Hardly anyone likes it better than I do when the economy is going full blast. I love it. Not that I benefit by it or from it, but I love it too because --
The Acting Speaker: The member for Niagara South.
Mr Tim Hudak (Niagara South): I am pleased to rise in support of the comments that I always enjoy from my partner, the member for Etobicoke-Rexdale, who I find speaks a lot like the average taxpayer that I hear from in my constituency and the average taxpayer who supported this party to form the government.
And an interesting approach that I hear from the taxpayer, how the member for Etobicoke-Rexdale pillories the local politicians or the opposition politicians, who throw up their arms at any sign of change and say it's automatically a tax increase. They're going to run on the basis of fighting the changes the province is making. "We're going to run and say no to social housing changes." Or the local politicians say, "We're going to run and say that the province must fund 5% of libraries," instead of allowing 100% local funding.
But I'd say to those politicians and to the opposition members across the floor: "That dog don't hunt. It barks, it squeaks, it whines, it howls, but that dog don't hunt." Local taxpayers, local electors want to see politicians working together to end the finger-pointing as to whether it's a provincial service or a municipal service, sending them from door to door or from desk to desk. They want an end to the runaround and to find out very clearly who's responsible for delivering a service and what politicians they should go to, to make sure that service is a quality service.
I'll give you an example. When you put social housing at the local level for administration and funding, when you coordinate that with Ontario Works at the local administration and coordinate that with public health, that affects a lot of the same taxpayers in Ontario. You break down the silo mentality where you point from desk to desk to desk and nobody gets help from all three sectors. They can all work together at the local level to make sure those who are in need, those who are vulnerable, get quality services that will help them move up the social ladder and make it a better province.
Mr David Ramsay (Timiskaming): The previous speaker, the member for Etobicoke-Rexdale, I guess really under the new rules had to sort of amaze and wow all of us here because he's in prime time now under the new Tory rules. He had 20 minutes, but he's up against Larry King and some of the prime time shows. He certainly amazed me and I think he amazed many of the good people out there, the citizens who wish to put their names forward to run as municipal reeves and mayors and councillors right across this province. To accuse them of purposely sabotaging their own municipalities, municipalities where they live and raise their families and work, I think is an absolutely astounding accusation to make for people who give themselves to public service.
I think you'll find that whatever you give them, all the offloading challenges you're going to give them, the men and women out there who will be victorious in those municipal elections will do their very best to work, I'm sure they will, for their towns and their townships. I think that's a real insult and I hope you would reconsider your remarks.
It's interesting to note that I understand on August 23 there were a whole number of Tory municipal candidates who were right here at Queen's Park getting the word, getting some training on how to handle the election. Make sure you don't point your finger at Mike Harris and that Harris government for all the downloading. That would be verboten. So make sure you don't do that. They've got their marching orders and they've gone out now right across the province and they're going to be running in all those areas.
But there are other good people who are also going to be running and I think you have to give them the benefit of the doubt that they'll do the very best job they can under the very trying and challenging circumstances that you have set for municipalities right across this province. I hope they can be successful. I hope they can try to stay the line and not raise the taxes as much as I think they're going to have to, with all the Harris government downloading.
Mr Hastings: I thank the member for their remarks, some supportive, some still back in the tax addict context. But what would one expect?
I'd simply like to point out a couple of things. I recall that the member for Scarborough-Agincourt campaigned a few years ago on reforming the property tax system, the assessment system -- listen to this, folks -- to a market value assessment system, which he has subsequently many times condemned in this House, if you go back and look at his position in that election of 1990. I just want it to be on the record.
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Mr Bradley: What does this have to do with anything?
Mr Hastings: In this House anybody can speak about anything. The member for St Catharines is practised at being able to speak about anything the previous speaker never even referenced. I'm simply following in his good footsteps in that degree, although he has been here a few more years than I. I hope I don't have that habit become an alarming one and a repetitive one.
I simply wanted to conclude by pointing out that the new Services Improvement Act will bring about a sort of new light on the hill, a new vision for cities. It was a vision of the new city on the hill first raised by St Augustine. I think the new city of Toronto has that potential. I would like to add a quotation that I hope does not come true made by Richard I: "Lord, I pray thee to suffer me not to see thy holy city since I cannot deliver it from the hands of thy enemies."
I would conclude that what we have --
The Acting Speaker: Thank you, member for Etobicoke-Rexdale.
Mr Colle: It's very difficult to follow those quotes from St Augustine and -- was it Henry IV or VIII?
Mr Hastings: Richard I.
Mr Colle: Richard I, excuse me. It's very difficult to match those quotes. I certainly commend the member for doing that research and adding some intellectual depth to his presentation with those quotes from those monuments of intellectual debate.
In terms of this bill, the interesting thing is that it is part of another 40 bills this government has introduced. Of the total of 80 they've introduced over the last two years, 40 deal with restructuring cities and towns and local government. Almost half the agenda of this government has dealt with revolutionizing, reshaping local government. Who would have believed, if you looked back to the Common Sense Revolution and the campaign of 1995, that this was the government you were electing to spend half its time revolutionizing city government or town government or county government? That's what they've done.
I can't recall too many people on the hustings in 1995 saying, "You've got to do something about my local government; you've got to do something about my local school board." People were saying they wanted jobs; people were saying they wanted good health care; people were saying they wanted safety on their streets. Those were the basic issues.
Where this, you might say, monumental urge to get into people's faces at the local government level came from certainly is a mystery to most of us on this other side, because it wasn't a big part of the Common Sense Revolution. If you look through the book -- and I think most of the copies have been confiscated now. I had one on my desk and it's gone also -- there is very little about local government in there. There is a lot about many other aspects, about job creation, about labour relations, but half of the legislative load this government has put before this House and the people of Ontario deals with municipal restructuring. It's unprecedented. This bill is a continuation of that emphasis on reshaping municipal government.
These changes are quite dramatic; there's no debating that. You have to give the government credit for being very dramatic in the changes it is bringing about. The changes are very comprehensive because they will affect every county, every township, every city, every regional government throughout Ontario like they have never been affected before. They will affect how they tax, how much they tax; they will affect the services that are delivered, who delivers them; and all this will be in place in a very short period of time. They've essentially reshaped and realigned municipal responsibilities and provincial responsibilities in a very short time frame. The window is to open January 1, 1998, and things are going to happen fast and furious.
Local taxpayers are saying: "What will this do to my taxes? What will it do to my services? What will it do to my community? Will this be to the benefit of those local services, to my tax levels and to the city and town and community I live in?" With this shift there are a lot more questions than answers.
As you know, when this started there was that mega-week or mega-downloading announcement that took place within that week in January, I think -- one after another. Nobody knew where some of these ideas even came from. I know this idea, for instance, about putting social housing, affordable housing, whatever you want to call it, housing the province had, on the property taxpayer is quite revolutionary. There isn't one jurisdiction in the world that has downloaded that has put social housing on to the local property tax bill. There isn't one. The government has failed to produce one study that shows it should do this.
Even the commissioner of the Crombie Who Does What panel said, in relation to this shifting of housing on to the property tax, "David Crombie has reacted very strongly against the government's move, calling it `just wrong and coming out of the blue.' He states that the move was done on the back of an envelope, without discussions, without any input from anyone."
Probably the most dramatic shift in the downloading is going to be this housing. Nobody during the 1995 election was saying, "You should put social housing on to the local property tax bill." Nobody asked for that. The elected officials or the provincial candidates, even the platforms of the three parties -- I don't think there was one platform that said, "Put the cost and administration of social housing on to the local tax base."
That's unprecedented, because traditionally social housing is paid for by the federal government and the provincial government, with a little bit of support in certain isolated areas from the local municipalities. For instance, you have Cityhome in the city of Toronto, you have the Metro Housing Co, which are quite unique. But generally speaking, social housing is considered an income maintenance program that can't be on the property tax. As we all know, the property tax is limited. The property tax has no correlation with one's ability to pay. Therefore, you could have a person who has been out of work for two or three years having to pay this added burden along with a person who might have an income that is growing. That's why traditionally Canadians, and especially Ontarians, have shifted those types of programs away from the property tax and put them on income maintenance programs or income tax. That was the way we always went and what people accept internationally as the way to provide for social housing.
You may ask, why do we do it? In essence, it's a very complex program, because you're not only dealing with buildings; you're dealing with families, seniors, children who live in this affordable social housing. You can't just provide the bricks and the mortar; you need support programs for social housing to work. That is why municipalities have been very reluctant to take this on. They know that once you put up a building, you can't expect the building to take care of the people by itself. You have to put in support programs, outreach programs; you have to put in the soft infrastructure to make it work. That is why municipalities have never gotten into it. Now this government is saying: "Municipalities, you should try this. We think it's good for you."
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I think this is a very dangerous download. It's probably the most dangerous of all the downloads. For instance, it is anticipated that it will cost about $360 million to upgrade the units we have here in Metropolitan Toronto alone. The province has only allocated approximately $270 million for the whole province. Metropolitan Toronto alone needs $360 million to fix up and to renovate the units they have already on hand. Many of them are older; they've reached that 30-year range where they need significant retrofitting. That's why the dollars are so large, and that is why it's very dangerous for municipalities to take this load on.
As you know, municipal governments and property taxpayers go through cycles. In the 1980s, those of us who sat on local councils know, tax revenues were coming in; assessments were growing. We were able to deal with growing demands and therefore we were able to keep a relatively high level of service and a relative lid on taxes. But as the recession hit in the late 1980s, near the 1990s, it was a whole new ball game. You could not find money to provide for the services. You had a hard time dealing with the reality.
For instance, in Metropolitan Toronto there was an explosion of the welfare rolls as unemployment swept across southern Ontario. Metropolitan Toronto came almost to the point of declaring bankruptcy because of the impact of welfare. They had to have the support, the cap of the provincial government which allowed for the provincial government to kick in money at a certain point. If that hadn't happened, if it wasn't for provincial protection, Metropolitan Toronto would have been forced to make massive cuts to all their programs.
That's why municipalities go through cycles. Things may be on the upswing right now. As you know, the Dow Jones went up 260 points yesterday, the TSE is doing well, there is a bit of economic activity, things are looking good. Things might be copacetic for the next two or three years, and so maybe we'll be able to pay for those through our property taxes, but what happens five or seven or eight years down the road when there's another recessionary cycle? Hopefully there won't be, but if there is and then there's an influx of people who can't afford housing, who have to go into social housing or may have to go on to social assistance, what happens to those local property taxes?
That is why traditionally the provincial government and other provincial governments across Canada have protected local property taxpayers by spreading the pain through the income tax and asking for help that way. But this is a complete revolutionary approach which does the opposite of that trend. It puts social housing on to local property taxes. It's quite unusual, again unprecedented, and quite, as I said, dangerous because of the cycles.
Another interesting part of this bill is that it's also part of the downloading of the cost of public transit on to the local property taxpayers. In the Metropolitan Toronto area, not only will the TTC now be completely funded by local property taxpayers in the fare box; GO Transit also will be funded by the property taxpayers in the cities of the GTA and the 4.3 million people who live there.
At first blush, that doesn't look like too much of a problem, especially when, let's say, things seem to be pretty optimistic in a fiscal sense. The concern, though, is that with projects and undertakings like GO Transit, the future may demand massive investments of infrastructure to expand GO Transit. As you know, if you drive on the QEW parking lot and you go out to the Niagara region, you can see that we've almost come to gridlock; you can't get into or out of the Niagara region almost. Whether it's 3 in the morning or 2 in the afternoon, there's constant gridlock because there are in essence too many cars and not enough road space.
So you're going to have to invest more money in GO Transit lines; you're going to have to have better services. What that will mean is there will be another demand on local property taxpayers to help pay for expanded GO Transit and local bus services, because I don't see anything in the works, unless we build another toll highway, which we may have to, to ease the burden in the GTA for this traffic gridlock.
It's everywhere. As you know, if you go towards Durham along the 401, if you go on the 400 at any time, it's the same gridlock. So we're basically stuck in this bumper-to-bumper traffic. It has to be relieved, and probably the way you'll relieve it, along with maybe some strategic road expansion, will be strategic investment in GO Transit across the GTA. You may have to build new GO lines that are for passengers on all the existing abandoned rail lines, the CN/CP lines that sit there that have been used for freight.
That's going to take massive investments of dollars, but since the province is not going to be helping, that massive investment is going to have to be made on the backs of local property taxpayers. That is going to be a very expensive proposition. As you know, GO Transit has been supported. More than half its revenues come from taxes already. The fares will not pay for it by themselves, or else they'll be a disincentive for people to ride, so you have to invest in GO Transit.
As we look to the future in the GTA, as we look to the future in Ontario, we're going to have to spend more money. We're going to have to invest more money in public transportation in order to improve everything from the gridlock problems to air quality. As you know, even your own Minister of Environment has finally done something and is going to have some testing of automobiles, because air quality is deteriorating. You know why it's deteriorating? As the economy has improved, we see a lot more commercial activity, vibrancy, on our roads, but that also brings more congestion, more exhaust fumes. That's why we're going to have to invest seriously in the GTA, especially down in southern Ontario, in more public transportation, as we do in roads. These costs now will no longer be on the provincial income tax. They're going to come down to the local property taxpayer. The question will be, can the local property taxpayers take care of the housing burden, and will they be able to take care of the new transportation demands?
There will be ongoing regular demands like garbage pickup, disposal, recreational services. There are also some new responsibilities. Health will now be local; ambulance services will be local. But these are very expensive services, especially those that get on the soft service side.
Certainly there has been a removal of 50% of the property tax off the tax bill, but as you know, that's going to be replaced by these other programs that are now on the tax. So the question is, will these shifts mean you are going to have communities, big and small, that are going to be able to provide those services, expand some services, try some innovative ideas, without being choked in the straitjacket where they're going to have to have money available to meet emergencies? That is the fear that most municipalities have, because at any time, as you know, there could be a major infrastructure emergency, whether it be major water lines or sewage projects. It could be anything of that nature. They come up. Along with social emergencies, whether they're the result of unemployment or the result of a need to house people, those will come up.
This downloading restricts that manoeuvrability. I think the manoeuvrability has to be there because of the change in conditions. What we see in 1997 will not necessarily be what we'll see in -- I guess we go to the year 2005, for instance. Where will we be? That is the unpredictability of the shifts we've seen. Very few people can really tell us that these are going to be totally bad or totally good. There are just too many uncertainties.
That is what we've witnessed over the last six months. We've gone through so many calculations, so many changes, so many task forces, so many interpretations. I guess the only thing we're going to have to remember is that the Premier has really come out and stuck his neck out. He has guaranteed that property taxes will not go up. Therefore, the Premier will either have to throw money at the programs to keep the taxes down or they will have to bail out the municipalities somehow. But the Premier was quite unequivocal that he and this government are inextricably linked to the property tax bill.
So the people all over Ontario for the next year or two or three -- hopefully it's not three -- every time they pick up their property tax bill will have to phone Mike Harris about the tax bill, because all this change has been perpetrated by his government. All these changes have been guaranteed to be revenue-neutral. He has guaranteed no tax increases despite these unprecedented, revolutionary changes. That tax bill will be Mike Harris's property tax bill, and if it goes up, they have to call him.
The Acting Speaker: Members of the assembly, I'd like to take a moment to thank the table for the guidance during my three weeks as a fill-in. I'd also like to thank Speaker Stockwell for affording me this opportunity and for your patience.
Now that it is 9:30 of the clock, or I would say 9:30 pm, this House stands adjourned until 10 of the clock or 10 am tomorrow, and the debate will continue tomorrow.
The House adjourned at 2132.