Hansard Transcript 1997-Sept-15 vol. a | Legislative Assembly of Ontario

The Speaker (Hon Chris Stockwell): I beg to inform the House that the Clerk has received from the chief election officer and laid upon the table three certificate of by-elections in the electoral districts of Oriole, Ottawa West and Windsor-Riverside.

Clerk of the House (Mr Claude L. DesRosiers):

(1) "Mr Claude L. DesRosiers

"Clerk of the Legislative Assembly

"Room 104, Legislative Building

"Queen's Park

"Toronto, Ontario

"M7A 1A2

"Dear Mr DesRosiers:

"A writ of election dated the 23rd day of July 1997 was issued by the Honourable Lieutenant Governor of the province of Ontario, and was addressed to Joyce Puddicombe, returning officer for the electoral district of Oriole, for the election of a member to represent the said electoral district of Oriole in the Legislative Assembly of this province in the room of Elinor Caplan, who since her election as representative of the said electoral district of Oriole has resigned her seat. This is to certify that, a poll having been granted and held in Oriole on the 4th day of September 1997, David Caplan has been returned as duly elected as appears by the return of the said writ of election, dated the 12th day of September 1997, which is now lodged of record in my office.

"Warren R. Bailie

"Chief election officer

"Toronto, September 12, 1997."

(2) "Mr Claude L. DesRosiers

"Clerk of the Legislative Assembly

"Room 104, Legislative Building

"Queen's Park

"Toronto, Ontario

"M7A 1A2

"Dear Mr DesRosiers

"A writ of election dated the 23rd day of July 1997 was issued by the Honourable Lieutenant Governor of the province of Ontario, and was addressed to Robert Faulkner, returning officer for the electoral district of Ottawa West, for the election of a member to represent the said electoral district of Ottawa West in the Legislative Assembly of this province in the room of Robert Chiarelli, who since his election as representative of the said electoral district of Ottawa West has resigned his seat. This is to certify that, a poll having been granted and held in Ottawa West on the 4th day of September 1997, Alex Cullen has been returned as duly elected as appears by the return of the said writ of election, dated the 12th day of September 1997, which is now lodged of record in my office.

"Warren R. Bailie

"Chief election officer

"Toronto, September 12, 1997."

(3) "Mr Claude L. DesRosiers

"Clerk of the Legislative Assembly

"Room 104, Legislative Building

"Queen's Park

"Toronto, Ontario

"M7A 1A2

"Dear Mr DesRosiers:

"A writ of election dated the 23rd of July 1997 was issued by the Honourable Lieutenant Governor of the province of Ontario and was addressed to Amedee Janisse, returning officer for the electoral district of Windsor-Riverside, for the election of a member to represent the said electoral district of Windsor-Riverside in the Legislative Assembly of this province in the room of Dave Cooke, who since his election as representative of the said electoral district of Windsor-Riverside has resigned his seat. This is to certify that, a poll having been granted and held in Windsor-Riverside on the 4th day of September 1997, Wayne Lessard has been returned as duly elected as appears by the return of the said writ of election, dated the 12th day of September 1997, which is now lodged of record in my office.

"Warren R. Bailie

"Chief election officer

"Toronto, September 12, 1997."

Mr Dalton McGuinty (Leader of the Opposition): Mr Speaker, I have the honour to present to you and to this House David Caplan, member-elect for the electoral district of Oriole, and Alex Cullen, member-elect for the electoral district of Ottawa West, who have taken the oath and signed the roll and who now claim the right to take their seats.

The Speaker: Let the honourable members take their seats.

Mr Howard Hampton (Rainy River): Mr Speaker, I have the honour to present to you and to this House Wayne Lessard, member-elect for the electoral district of Windsor-Riverside, who has taken the oath and signed the roll and who now claims the right to take his seat.

The Speaker: Let the honourable member take his seat.

VISITORS

The Speaker (Hon Chris Stockwell): I'd like to announce to the House that in the Speaker's gallery today are the delegates attending the 14th American regional assembly of the AIPLF. Welcome.

MEMBERS' STATEMENTS

PROSTATE CANCER

Mr Gerard Kennedy (York South): I rise today to speak about a subject that sometimes is difficult for people, and it's in connection with Prostate Cancer Week declared by the Canadian Cancer Society.

Prostate cancer, like all cancers, is insidious, but there's a particular quality to prostate cancer in that for various reasons males affected by it, males in general, are reluctant to discuss it. Sometimes prostate cancer is confused with the sexual function with which it is related in a health sense and it gets in the way of people dealing with this basic health concern.

The reality is it's the largest cancer attack that exists for men in society. It is not yet the largest death rate, but 7,100 men in this province will be afflicted with prostate cancer this year; some 1,550 will die from the disease.

The reluctance of society to deal with it, and of men in particular to acknowledge prostate cancer, means that it goes undetected unnecessarily; that there may not be the same kind of focus in terms of research funding for some other gender-specific cancers; that, for example, the tests which are known to detect this disease are not funded yet by OHIP.

While it's a cause of consternation to people, it is essential in this Prostate Cancer Awareness Week that men in this province talk to their doctors, that they get the simple test that is the prelude to it, and that they also talk to the Minister of Health, to their MPP, to ensure that we are doing everything we can to rid ourselves of this insidious disease.

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VISITOR

The Speaker (Hon Chris Stockwell): I'd like to take this opportunity to introduce in the west gallery the previous member for Oriole. I believe she has a new title now and I'm not certain of the riding. Is it Thornhill? Yes. The previous member for Oriole, Ms Elinor Caplan, welcome.

UNITED WAY CAMPAIGN

Mr Tony Martin (Sault Ste Marie): Tomorrow in Sault Ste Marie the United Way kicks off its fall campaign, and what a campaign it's going to be. Led by the able efforts of Carmen Borghese, the executive director for a number of years now, and the president, Don Watson, the United Way of Sault Ste Marie will once again pull together the efforts and energies and goodwill of literally hundreds of volunteers across Sault Ste Marie to make sure that two things happen: first, that the community is made aware of the very valuable work of the many agencies which belong to the United Way and the efforts of the people who work for those agencies on behalf of people in various circumstances in today's society, challenged in ways that they're in need of the assistance of the various wonderful skills presented by the people who belong to those agencies.

They will also be asking people to consider giving donations, consider being generous to those who might otherwise not get services. In these very difficult times, when we're all challenged in many serious ways financially, it is more important than ever before that we dig down deep, particularly those of us who have a job, who are fortunate enough to have a source of income, to consider those who may not have and to give to the United Way at this time of year.

DIANA, PRINCESS OF WALES

Mr John Hastings (Etobicoke-Rexdale): The people of the world were shocked and saddened by the tragic death of Princess Diana. People were drawn to her compassion and her commitment to charitable work. Indeed, the loss for singer Elton John was so great that he felt compelled to compose a new version of Candle in the Wind to commemorate the life of the late Princess Diana. All proceeds from the sale will go to the charities that Princess Diana worked so hard to support.

On Wednesday this week this song will be released in Canada. In the spirit of charity, I call on the Ontario Minister of Finance to follow the British House of Commons' example and forgo the provincial sales tax on this song and support the legacy of Princess Diana. I also call on the federal Minister of Finance to forgo the GST so that all the moneys collected may go to the Princess Diana Memorial Fund.

MAGNETIC RESONANCE IMAGING

Mrs Lyn McLeod (Fort William): The Minister of Health is resorting to writing letters to the editor in a futile effort to convince people that our health care is not in jeopardy when everyone knows it is.

On Saturday, a letter from the minister appeared in our Thunder Bay daily, the Chronicle-Journal. The letter was, first and foremost, an attack on the Liberal health critic for raising concerns about lack of access to MRI diagnostic services. The letter also talked about the ministry's intentions to increase the number of MRIs and assured the public that people who need an MRI on an emergency basis would have access to this service in a timely manner.

Even if the minister is desperate to get people to listen to his defence, why would he enrage the people of northwestern Ontario by sending his letter to Thunder Bay? First of all, the letter describes how many machines are going to Toronto and Burlington and Newmarket. Does he think that will allow timely access to people more than 1,000 miles away? I wonder if he realizes that the closest MRI to Thunder Bay is in Timmins, about 800 kilometres away. Does he think that will be adequate in times of emergency?

But the most offensive thing about this letter is that Thunder Bay has been promised the operating costs of an MRI, but it's a conditional promise. To get it, Thunder Bay has to first of all agree to shut down three hospitals and accept a totally inadequate 60-year-old facility as our only acute care hospital. The proposal for an MRI has been on the minister's desk since long before he sent his commission into our town, but it won't be approved until our community bows to the commission's dictates.

The Minister of Health is using essential MRI services as a weapon to blackmail us with. The next time he gets a letter-writing urge, let him leave us off the list. We can only stand so much.

SCHOOL BOARDS

Mr Gilles Pouliot (Lake Nipigon): Vous me permettrez de souhaiter une bienvenue tout à fait spéciale à nos délégués spéciaux, membres de l'AIPLF.

The municipal election date is fast approaching and still there are candidates and potential candidates in my riding, that of Lake Nipigon, who are awaiting clarification from the Minister of Municipal Affairs and Housing on subsection 37(1) of the Municipal Act, as amended by Bill 86.

This legislation eliminates all school board employees -- each and every one of them -- in Ontario from running and holding office as municipal councillors. The minister has decreed it, indicated to me in writing, that it was not his intention to prohibit anyone from running for any municipal government office. The solicitor of the town of Marathon in my riding has informed the clerk that the legislation has been badly drafted. It's a mess out there. Many municipal clerks across Ontario have been trying to get this matter clarified, to no avail. The town of Geraldton, also in the riding of Lake Nipigon, has written the minister twice. I myself have tried in vain, writing the minister. "We're seeking legal opinions to recognize school boards as local boards, and therefore a school board employee should not be able to hold office." That's what this guy is saying.

The legislation is far too --

The Speaker (Hon Chris Stockwell): Thank you very much.

SEEBURN DIVISION/VENTRA GROUP

Mrs Julia Munro (Durham-York): It was a pleasure for me to be on hand in Beaverton as Seeburn Division/Ventra Group Inc was recognized for the third time as General Motors supplier of the year for 1996. Seeburn Division is the world's leading designer and manufacturer of parts for the passenger car and truck industries in North America, South America, Europe and Japan. Seeburn Division is one of only 13 Ontario firms to receive this coveted award this year, and the company was among the select few chosen from a General Motors supplier base of more than 30,000 companies in 26 countries.

This unique award demonstrates this company has found better ways to set up an organization to meet customer needs, to tackle financial challenges -- in short, to make a business more effective and efficient. Sometimes this has meant using new knowledge or technologies, but often it's a matter of using existing knowledge with extra insight.

My sincere congratulations to the management and employees of Seeburn Division/Ventra Group Inc and continued success in the future.

EMERGENCY SERVICES

Mrs Sandra Pupatello (Windsor-Sandwich): I am hoping today that before we get into question period, we will have a moment for a statement by the Minister of Health. He is back in town today. I know he is well aware that all our communities are very aware and have read his own report on emergency services in the Windsor area, so today we are calling on the Minister of Health for action. Our community is very concerned, and we are expecting immediate emergency relief. He knows that a problem exists, and it's not good enough to talk only in rhetorical terms; we need to see immediate action.

As late as September 12, we received yet another missive from the Minister of Health talking about how wonderful everything is in Windsor, especially concerning our emergency services. Our emergency workers are calling for help. They are desperate for some kind of support. In fact, we have a number of people in our community, one of them being Dr Joe Renaud, who said that "conditions where patients are lying on the floor in pain are certain to discourage new doctors the area is trying to recruit."

We told them it would squeeze all the flexibility out of the system. You can cut beds, reduce ORs, but if you cut emergency, you're creating an unsafe situation. Let me remind you of the minister's own report, which reads: "Physically, emergency units are hopelessly inadequate, inefficient and unsafe."

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BY-ELECTION IN WINDSOR-RIVERSIDE

Mr Wayne Lessard (Windsor-Riverside): On September 4, the constituents in Windsor-Riverside had an opportunity to send Mike Harris a message about what they thought of his last two years in government. This government says they like referenda. Well, the voters in Windsor-Riverside voted no to the Mike Harris cuts to health care, they voted no to cuts to education, they voted no to cuts to environmental protection, and they voted no to Bill 136 as well.

Over the last two years in Windsor we've seen longer waits for surgery, we've seen our emergency rooms in a state of crisis, and we've seen user fees for prescription drugs for seniors.

The voters in Windsor-Riverside just didn't say no to Mike Harris and the Conservatives; they said no to the Liberals as well. They knew that another member in Windsor wasn't going to make the least little bit of difference, because one of the very members in this room today said in 1995 that they were singing from the same song sheet. We have federal members in Ottawa, we have provincial members in Queen's Park, and we can't even keep our local weather station open.

I look forward to following up where Dave Cooke, the former member, has left off, and Fred Burr before him, to fight to preserve health care in Windsor.

I want to acknowledge as well my mother and my wife and my son Brett, who are here with me to share my --

Applause.

The Speaker (Hon Chris Stockwell): That was your first time up. That's as easy as it's going to get, I guess.

SCARBOROUGH CHILDREN'S PROJECTS

Mr Dan Newman (Scarborough Centre): It's a pleasure to rise in the House today as the member for Scarborough Centre in order to inform the Legislature of two tremendous initiatives for children that are taking place in my riding.

In the first project, the Home Depot has joined forces with Youth Assisting Youth, the local community, Scarborough councillor Paul Mushinski and myself to build a community playground on Trudelle Street. The Home Depot will supply $20,000 to the project, while the community will work to raise the remaining $15,000. I am pleased to announce that Eli Lilly Canada of Scarborough has already pledged $1,000 towards the playground.

This project truly is a partnership between the entire community. In fact, last week the area children were invited to a design day where they were given the opportunity to actually draw pictures and design the playground that will be built. On November 1, 1997, community volunteers will build the playground in a day, and I will be there to help them as well.

The other exciting project is the proposal to build a children's safety village in Scarborough Centre. Like the playground, the safety village will be built in a partnership between the community and the private sector, with not a single tax dollar being used.

Several of the members in this House are probably aware of safety villages in their areas. However, the Scarborough Children's Safety Village will be the first indoor safety village in all of Ontario.

I would urge everyone who is interested in donating money or time to one or both of these worthy projects to contact my office.

MOTIONS

HOUSE SITTINGS

Hon David Johnson (Chair of the Management Board of Cabinet, Government House Leader): I move that, pursuant to standing order 9(c), the House shall meet from 6:30 pm to 9:30 pm on Monday, September 15, 1997, for the purpose of considering government business.

The Speaker (Hon Chris Stockwell): Is it the pleasure of the House that the motion carry? All those in favour, please say "aye." All those opposed, please say "nay." In my opinion, the ayes have it. I declare the motion carried.

STATEMENTS BY THE MINISTRY AND RESPONSES

ONTARIO HYDRO

The Speaker (Hon Chris Stockwell): Minister of Environment and Energy.

Interjections.

The Speaker: Let's let him start before we heckle.

Hon Norman W. Sterling (Minister of Environment and Energy): The safe, reliable and efficient operation of Ontario Hydro's nuclear facilities is a top concern for the Ontario government. I know it is also a priority for everyone in this Legislature.

As my colleagues are aware, serious assertions were made about these operations in the recent independent integrated performance assessment report, although the nuclear regulator here in Canada, the Atomic Energy Control Board of Canada, has stated that Hydro's reactors do not constitute an immediate safety risk. Hydro has since released a nuclear recovery plan for bringing its reactors up to superior industry standards.

I believe, and I know the government and opposition members alike share this view, that an urgent review of the Hydro plan by provincial public policymakers is necessary to ensure that the utility is kept on the right track. We must protect the best interests of both the ratepayers and the taxpayers in Ontario.

Today, in recognition of these common concerns, the Legislature will be forming the select committee on Ontario Hydro nuclear affairs. We propose that the committee will be chaired by the member for High Park-Swansea, Mr Shea, and vice-chaired by the member for Wilson Heights, Mr Kwinter. Its mandate will be to scrutinize Ontario Hydro's nuclear recovery plan and its economic and environmental implications for Ontario.

I would like to thank the opposition critics and the House leaders for their cooperation in this matter. I think they are to be congratulated for recognizing that the problems that have occurred at Ontario Hydro transcend several governments, and dealing with these problems transcends partisan politics.

The committee will be empowered to call upon witnesses and any documentation that they need for examination. It will scrutinize the independent integrated performance assessment report and the findings of the Atomic Energy Control Board of Canada report that I requested last month.

It is our intention that this select committee will return with an interim finding by October 3, with its final report to be submitted by December 1.

I believe the committee's work will be important in assuring the people of this province that their interests are being served. I look forward to working with the members as we examine Hydro's future nuclear directions.

Mr Sean G. Conway (Renfrew North): On behalf of my Liberal colleagues, I want to respond to the announcement the Minister of Energy made a moment ago. We have agreed that it is timely for a select committee of the Legislature to look at the current operations of Ontario Hydro. I believe, and I have said on a number of occasions over the last few weeks, that my preference is for a parliamentary commission as opposed to an outside inquiry, simply because I think it is appropriate and timely for the Legislature to once again try to discharge its responsibilities in this respect. We have an oversight responsibility and I think it is appropriate that we pursue this through the select committee route.

This is serious business, and it is timely. I want to say publicly what I said to the minister in recent days. If this parliamentary commission is to do its proper work, it must from the Liberal point of view undertake two aspects of inquiry. Firstly, the committee must ascertain what has gone wrong at the nuclear power reactors and what a responsible recovery plan might be. In that connection, it is absolutely critical that an independent evaluation be undertaken by the committee of the so-called recovery plan that Hydro management announced four weeks ago. If there is not an independent evaluation of Mr Farlinger's multibillion-dollar recovery plan, we will have failed the public in our duty.

Secondly, it is absolutely critical that the minister, Mr Sterling, at a very early point produce the government's white paper on electricity reform, because no member of the Legislature, no citizen of Ontario can properly evaluate a recovery plan for the nuclear power division unless and until the government does what it said it would do over a year ago, namely, produce a government white paper on electricity reform.

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I want to be absolutely clear about those two essentials from our point of view. If neither of those points is met, then we will have failed. I have better things to do with my time and the public's money than engage in some kind of scam, something that might appear to provide only legislative cover, so Mr Farlinger, the acting president of Ontario Hydro, can go on and do what he has already decided to do.

I know for a matter of fact there are people in the highest levels of the Ontario government who are very concerned about what the Hydro board announced and decided a few weeks ago. I've been engaging the ministers of energy and finance in this assembly in recent days on that very point. I just want to underscore one point again. The Hydro board received the integrated performance review, the IIPA, in late July and within days the board decided on and announced publicly a $5.5-billion to $8-billion recovery plan. Within days they decided on a multibillion-dollar recovery plan.

I have some very grave suspicions about what has gone on here. I'm not going to engage in a conspiracy theory, sceptical though I might be, but I will insist that there be independent evaluation, by people who know what they're talking about and looking for, of Mr Farlinger's plan. It is in that connection that I draw to the minister's attention once again my concern about any kind of legitimate legislative oversight that is announced on 15 September and is supposed to make an interim finding in 17 days' time. Whom do we suppose we are fooling? Surely the minister is right when he says we've all gotten our hands dirty as politicians in this Hydro business, but there cannot be any honourable member who honestly believes that this committee, which I believe in, can do its work in 17 days.

Mr Floyd Laughren (Nickel Belt): I am pleased to respond to the Minister of Energy concerning the creation of a select committee for Hydro. As the minister knows, we in this caucus wanted an independent commission of inquiry to look at Hydro, because we do not think that a committee dominated, even though they be sterling people all, by Tory backbenchers is necessarily going to give us the kind of independent analysis that we would like to see. Even though the minister says in his statement that the problems at Ontario Hydro transcend several governments and dealing with these problems transcends partisan politics, one would think that if it transcends partisan politics, perhaps we could have had an independent commission that didn't need to be dominated by Tory backbenchers. It seems logical to me.

Mr Speaker, I don't want you to rule that the minister is in contempt of the Legislature; however, for him to stand in his place -- and the written statement is slightly different from his oral statement. The written statement says, "The Legislature has agreed to form the select committee on...Hydro," and his oral statement said, "The Legislature will be forming the select committee on Ontario Hydro." I think there's a certain presumptiveness there that really doesn't sit well on the Minister of Energy. However, I do not want you to rule that he's in contempt of the Legislature, Mr Speaker. I think that would not be completely appropriate.

I am going to be serving on the committee and much of what the member for Renfrew North said I support. We're not in this for some kind of dog-and-pony show as we travel about certain locations in the province. We really do want to get to the bottom of the problems at Ontario Hydro and in particular its nuclear division. Those of us who love Ontario and have a sense of its history know the critical role that Ontario Hydro, the electrification of Ontario, played in the economic development of this province. It was a very serious role they played, and we want that role to continue.

It was through public power delivered at cost that this province became as prosperous as it has been. We don't want that to change. We know that this government has an agenda for privatization that we think is sheer lunacy and we will be resisting that. However, we know there are problems in the nuclear division of Ontario Hydro and we want to get to the bottom of that.

I would reiterate what the member for Renfrew North said as well. The government has a white paper basically, I gather, on future competition in the generation and distribution of hydro power in Ontario. We need to see that. We don't want to operate in a vacuum as we deliberate on the problems of Ontario Hydro and the direction that Ontario Hydro must go. If we're to deal with the recovery plan in a serious way, we don't want to be spinning our wheels while the government is fully intending to go in a completely different direction, perhaps.

It's terribly important that we get a look at that white paper. If the Minister of Energy doesn't have that completed, perhaps he could tell the folks in the Premier's office to get their hands off it and let the Minister of Energy get on with delivering that white paper to the committee. It's very important that we see that so we're not operating, as I say, in a vacuum.

The costs of the recovery plan need to be analysed independently and questioned very seriously. They went from $5 billion to $6.5 billion to $8.8 billion in costs and we're suspicious. This government and Ontario Hydro are the same people who, when they brought Darlington into the grid, said, "It's going to cost $4 billion but it's complete." Now it's $14 billion, give or take a billion. We're not satisfied that Ontario Hydro necessarily has the people who will give us the independent objective, nor the people on that side, the Tories, who after all were the ones who launched Ontario into the nuclear age and said that these would be the costs. We know now that those costs were wildly underestimated.

I intend to serve on this committee and I want to take the work seriously, but I also think the time lines are bordering on the ludicrous to say, without the committee even having met yet and no staff hired, that we're going to have an interim report in less than three weeks. Nevertheless, we'll try. I don't think any of us are there to thwart the work of the committee, and I must say I look forward to serving on it and working with other members of the committee.

ORAL QUESTIONS

TEACHERS' COLLECTIVE BARGAINING

Mr Dalton McGuinty (Leader of the Opposition): My first question is for the Minister of Education and Training. Last Thursday I had the opportunity to visit a high school in St Thomas, Central Elgin high, and I had the opportunity to speak with the entire student body at an assembly. I had the time to think about it this weekend, and one of the things that struck me was that these kids have a lot on their plate these days. They've got school, they've got part-time jobs, they're worried about how they're going to get to college or university, they're worried about the fact that you've increased their tuition fees by 30% and the fact that you've cut student aid. Today they're worried about whether they're even going to be able to finish their school year, and so are their parents. They're worried about a strike.

Minister, you clearly created the crisis with your cuts to classrooms and with the further cuts that you have planned. What are you doing to head off a confrontation with teachers?

Hon John Snobelen (Minister of Education and Training): I think it's rather obvious that we're working very hard to make sure there is not a confrontation with teachers in this province. We have had some consultations over the last few weeks that I believe were fruitful.

We've listened to what teachers had to say to us. We've had a chance to talk with people about what the bargaining climate should be for teachers in Ontario as we collectively try to build that better system, as we collectively try to build a system of education that's a match for the abilities of our students and where Ontario students won't be in the middle of the pack in terms of their performance on pan-Canadian and international tests. We don't think that is giving our students what they need for the future, so we're working together to build a better system.

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Mr McGuinty: Minister, you're fiddling. Today when parents drop off their students at school, they're very concerned about whether there's going to be a strike this week, and if not this week, then next week or the week after. Teachers today in their staff rooms are wondering whether they're going to be on strike. They wonder whether they've got a minister who has a genuine interest in bringing about substantive improvement to education in Ontario or whether your only concern is to take another $1 billion out of classrooms.

Teachers are telling us they've got a billion reasons to believe there's going to be a strike, and that's the billion further dollars you're going to be removing from Ontario classrooms. Minister, will you now decide to head off a strike by scaling back your plans to suck yet another $1 billion out of Ontario classrooms?

Hon Mr Snobelen: I think the Leader of the Opposition is aware of our plan to have the province be responsible for the funding of education and our commitment to make sure that funding is at a level that will assure every single student in the province a high quality of education. We've said that several times.

I went down a couple of weeks ago and asked people who represent teachers, the teacher unions in Ontario, to chill out with the rhetoric, to come in and talk with us to see if we couldn't build that better system together. Based on what the Leader of the Opposition has said just now in this Legislature, I would ask him to do the same thing, to chill out the rhetoric, to cut the strike talk and to help us build that better system of education. I think that's the responsible thing to do. I think it's the responsible thing for a politician in Ontario to do.

Mr McGuinty: The minister has one heck of a lot of nerve. He tells me to chill out on the rhetoric. He's the one who invented the phrase "creating a crisis." He's the one who brought this to a head. He's the one who has singlehandedly set back government-teacher relations in this province at least 50 years. That will be his legacy to education in Ontario. That will ride as the primary accomplishment of John Snobelen, Minister of Education.

You have taken $533 million out of our classrooms and now you're telling us you're going to take out another $1 billion, and then you say: "Teachers, come on and sit down and let's chat. We'll talk about it. But by the way, we're taking out another $1 billion whether you like it or not."

We've lost junior kindergarten, we've got fewer special-ed programs, you've gutted adult education, and you're not even listening to some of the messages being delivered by your own Education Improvement Commission, who are telling you you can't take any more money out of education.

Minister, when are you going to listen to what you're being told? When are you going to stop trying to fund your tax cut on the backs of Ontario students, so our teachers and our students will remain in the classroom, where they belong?

Hon Mr Snobelen: First, what we don't listen to is some of the statements just made by the Leader of the Opposition, which are frankly just plain wrong. I would have thought the Leader of the Opposition would have known the facts on this file better than he obviously does.

I can say this: We have been working together with people in education over the last two years to correct two problems that have persisted in Ontario, one of those being that we haven't had a funding system that matched the needs of our students, and we are taking that on and changing it; the other being that we will not allow our students to continue to have mediocre performance on pan-Canadian and international tests. Your government allowed that to persist; their government allowed that to persist. We will not. We don't think it's fair for the students of Ontario.

The Leader of the Opposition said back on May 7, 1992, speaking about teachers' strikes, "It's my feeling that although the legislation may have addressed the rights of teachers and boards, it really failed to adequately address the rights of students." I'm glad to see that the Leader of the Opposition feels that way. I hope he still does, and I hope he hasn't taken that back.

CHILDREN'S SERVICES

Mr Dalton McGuinty (Leader of the Opposition): My question is for the Minister of Finance. I saw you on television on the weekend and took great comfort from some of the words you uttered on TV. You said: "I think that any society, at the end of the day, judges itself by how we treat the underprivileged and less fortunate in society. I think it's government's role to try to do that." Heart-warming words indeed, and I want to tell you that this comes as particularly good news for Ontario kids who see themselves as some of the least fortunate in Ontario.

Government is about making choices, Minister, tough choices, and I'm sure, having made that statement, you would agree that helping today's kids is more important than a tax cut. So I'm just going to ask you, what funding cuts that you've made to children's services in Ontario will you now restore to help Ontario kids instead of proceeding with the tax cut?

Hon Ernie L. Eves (Deputy Premier, Minister of Finance): To the Leader of the Opposition, I also said, and I'm sure he would want to take into account everything that was said on Focus Ontario, that the best thing you can do for any individual in society is provide them with the dignity and meaningful wellbeing of a job. I think for the overwhelming majority of Ontarians, that is exactly what they want. The member will know that there are today 219,000 fewer people receiving social assistance in Ontario than there were in June 1995. That is because these people now have the dignity of a job and are able to contribute to society, and they're paying taxes.

Mr John Gerretsen (Kingston and The Islands): How do you know that?

Hon Mr Eves: How do I know that? Because revenues went up $2.2 billion last year from all forms of taxation.

Mr McGuinty: Minister, your words lend no comfort whatsoever to the three-year-olds in Ontario who are going to be beaten, punched or kicked and who will come under no supervision because 250 case workers have been laid off at Ontario's children's aid societies and they will not be visited. You cut $17 million out of children's aid society funding, and what that means is there's less protection available for Ontario's children. It's as simple as that.

Again, Minister, now that you recognize that in Ontario the needs of our children are a priority, will you restore the cuts that you've made to children's services in Ontario?

Hon Mr Eves: We are spending more money on child welfare this year in Ontario than ever before, as I'm sure the leader of the official opposition has heard from the Comsoc minister on previous occasions.

I, as a former Comsoc minister, can tell you that the Minister of Community and Social Services today is indeed a very committed, caring individual who is looking out for the best interests of women and children in this province, and she's doing an excellent job of doing that. Does that mean that every single person in Ontario is being taken care of? Absolutely not. But are we trying to do what is best for the overwhelming majority of Ontarians, especially the unfortunate in society? The answer is, absolutely.

Mr McGuinty: Let's just for purposes of the record understand what it is you've done to Ontario kids thus far -- and it's early days yet. You've cut $17 million from children's aid societies and they have responded by letting go 250 case workers. You have cut children's welfare payments by 22%. I defy you, Minister -- today is the 15th day of the month -- to go into any single mother's household, look in her cupboards today, look in her fridge today and find out how much food is there -- and you tell me that you're helping out Ontario's children by cutting their welfare payments.

You've also cut special education and junior kindergarten. You are robbing them of the opportunity to realize their academic potential, pure and simple. That's what you're doing when you do that. You've got priorities, you set them, and I say that when you make cuts to children's services, when you make cuts to education, your priorities are wrong.

Minister, again, once more, if you truly believe that children are a priority in Ontario, will you now restore the funding cuts that you have made to children's services right across the board?

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Hon Mr Eves: The leader of the official opposition talks about the $15 million coming out of children's services. He forgets to mention the $26 million that went back in through contingency funding from the Minister of Community and Social Services. He didn't mention that. He doesn't talk about the $10-million program for healthy babies and healthy children. He doesn't talk about --

Interjections.

The Speaker (Hon Chris Stockwell): Order.

Hon Mr Eves: To the former leader of the Liberal Party, it's quite obvious she wouldn't know anything about contingency funds from the way her party ran this province into the ground with a $100-billion debt. It's quite obvious to see you've never run anything.

The leader of the official opposition didn't mention the following amount of moneys we're spending on children as well: a $10-million fund for healthy babies and healthy children; a $20-milllion investment in preschool speech and language services for children; a $4.6-million ongoing investment in Better Beginnings, Better Futures; a $10-million grant to Invest in Kids Foundation.

The government is also committed to increasing our spending on child care by some $200 million over the next five years. The Ministry of Community and Social Services will be spending up to $600 million on child care alone, the highest ever in the province of Ontario's history, on a per capita basis, 50% more than in Alberta --

The Speaker: Minister of Finance, thank you very much. Come to order. New question, leader of the third party.

HOSPITAL RESTRUCTURING

Mr Howard Hampton (Rainy River): I have a question to the Minister of Health. Health care planners, health care workers, the public and just about everyone in the province has repeatedly told you that you cannot restructure our health care system effectively without good planning and reinvestment.

Even your own commission has told you that you cannot close hospitals and cut hospital services until the alternative community services are up and running. But you haven't listened. Instead, you continue to force your destructive health care cuts on to communities.

In Thunder Bay, you've got a severe bed shortage because of your cuts. In London, the psychiatric hospitals don't know how they will implement your plan. In Windsor, the situation is worst of all. It's backwards.

Why are you forcing hospital restructuring on Windsor without the financial resources to implement the changes and while your own commission is still studying Windsor? Will you tell the people of Windsor that?

Hon Jim Wilson (Minister of Health): The honourable member is correct in that the Health Services Restructuring Commission has visited Windsor and not issued a report on Windsor. We're awaiting that report.

The Speaker (Hon Chris Stockwell): Supplementary.

Mr Wayne Lessard (Windsor-Riverside): Minister, you just don't seem to get it. This is what's happening in Windsor. We've already got a restructuring plan. It was endorsed by your ministry. Financial commitments have been made. You called it an example for others to follow. But, in spite of finding these savings, Windsor hospitals still suffered a 13% cutback in funding.

Last April, emergency services were consolidated and the emergency room at Western Hospital was closed prior to renovations being completed at Hotel-Dieu Grace. Now there's a crisis in emergency services. The Win-Win report called for a $72-million investment in health care services in Windsor, but it hasn't materialized because your commission is investigating. This is crazy. Will you live up to the commitment to Windsor and solve this current crisis?

Hon Mr Wilson: May I begin by welcoming the honourable member back to this Legislature and saying that I'm fully apprised of the Windsor situation. It was the government, the DHC and the hospitals together that asked Dr Eugene Dagnone and Nurse Heather McGillis to go down to Windsor over the last few months and to make sure not only that we were providing resources but that all the planning was in place to make sure there's a smooth transition of consolidation of services in that city. I think you'll find that's reaffirmed in the press conference they are having tomorrow morning, that everyone is working together. A report with 10 recommendations was just released in the past few weeks and only one of those recommendations pertains to the Ministry of Health. The other nine are problems that the hospitals themselves, with the DHC and the ministry in concert, have to work through together.

Mr Lessard: You can't have it both ways. You use Windsor as an example of how restructuring should proceed and you seem to be doing everything to sabotage the process. Now you want to regionalize the district health council and totally change its membership so there won't be anybody who can oversee this transition. The new district health council will have to take on restructuring that is already under way in Windsor and also planning in Lambton and Kent county. It's perhaps going to set back plans by a year.

You have a report that tells you that emergency services in Windsor are in crisis and you refuse to follow through on the capital commitment. You refuse to listen to the district health council in Windsor and Essex county and you refuse to listen to your own commission.

Will you stop this commission and invest the necessary money and let this restructuring process proceed?

Hon Mr Wilson: I would remind the honourable member not to use the word "crisis." His own hospitals aren't using the word "crisis." There were 59 spaces capacity in the old emergency rooms; in the new emergency rooms there are 59 spaces. People are working very, very hard to transition the programs down there.

With respect to the DHC, we are working with them. We work with them all the time, and I think they will confirm that.

We have set aside and I have announced $72 million for capital improvements to the hospitals in Windsor. However, the hospitals themselves agreed in February, and I have the minutes of the meeting saying, "I guess the money won't be released until the Health Services Restructuring Commission finishes its report."

At least most people understand that the money is sitting there and it's ready to flow. It can't flow appropriately until we have the proper plans in place to make sure patients won't fall between the cracks. If there is anything I can do in the meantime between now and the commission's final report, I want to do that. We're working with the hospitals to see what we can do in the meantime, but I think there is a great understanding, and indeed many people in Windsor, including the DHC, want the Health Services Restructuring Commission to --

The Speaker: Thank you. New question.

Mr Hampton: To the Minister of Health again, I don't think people in Windsor got anything from you today that will make them feel better.

HOSPITAL FINANCING

Mr Howard Hampton (Rainy River): My second question is about what is happening in northern Ontario. On Friday it was reported in the Sault Ste Marie Star that there is a critical anaesthetist shortage in the Sault. This will result in elective surgeries being cancelled at a 50% to 60% rate. It will mean women in labour will go without epidurals. At the same time, Janice Willet of the OMA says there is a critical problem for general surgery and this will eventually affect emergency services. The reason, we are told, is due to your cutbacks.

Minister, while you talk about studying the health care situation in northern Ontario, we go from one service crisis to another. In spite of your announcements and pronouncements, surgery is being cancelled, hospitals are forced to lay off nurses, and they cannot deal with the emergency situations. Will you reinstate the hospital funding so people can do their jobs and look after people's health?

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Hon Jim Wilson (Minister of Health): We didn't take away any funding with respect to the anaesthetists. Three anaesthetists have left the community. This has happened many times. It happened under your watch as the government and it happened under the Liberals. It happens from time to time.

We will be ensuring that they're, again, part of the underserviced area program, the specialist retention program to try and attract anaesthetists. I should tell the honourable members that 30 anaesthetists graduated in July 1997. They're going through their PFC exams right now and some of them will be available for hiring in the province and we're going to do everything we can to recruit them to Sault Ste Marie.

Mr Hampton: This is the same tired answer we've got from this minister for over two years now, and while he gives us those answers the service gets worse.

On Friday the cardiac care coordinator for the northern region stated publicly that they are very concerned because at Sudbury Regional Hospital the average wait for cardiac surgery is now three months long. There is a great deal of concern because your so-called solution to the crisis in cardiac surgery was to plug in some one-time funding. So the wait went from three months to six months, but now it's going back up again. What this means also is that next year, when the one-time funding runs out, the list will go up even more.

Minister, will you commit today to a permanent solution? Will you reinstate hospital funding that you have cut in northern Ontario so that people don't die on your waiting lists?

Hon Mr Wilson: Cardiac care was not cut anywhere in the province. It's a protected area, as are mental health, dialysis and a whole range of areas. About 85% of the hospital budgets are protected and not a penny was allowed to be cut. You closed a whole bunch of psychiatric beds and we've had a moratorium on those.

With respect to cardiac care, in addition to no cuts, we added $2.7 million, which has increased surgeries over the past few months in Sudbury by some 35%. It's a record, and we should be applauding those doctors and nurses who are working so hard. Frankly, they're working overtime.

I've spoken with that doctor. He understands that we're putting as much money forward as possible, that through his good work and that of his colleagues and the nurses, surgeries are up 35%. Unfortunately, the demand is higher than anyone anticipated. We're looking at the situation again; it may require more money.

But I don't want the honourable member to keep going around the province saying we cut cardiac care. That is not what we've done. In fact, we've added $35 million across the province and surgeries are up everywhere. At least you admitted that our money cut the waiting list in half, which is far more than you did during your five years in office.

The Speaker: Final supplementary.

Mrs Marion Boyd (London Centre): Minister, that simply isn't the case and the statistics show it. They show very clearly that in 1996-97 the waiting list is higher than it has ever been at Sudbury. I'll pass it across to you. That's from the Cardiac Care Network.

You make these claims as though you are doing something that is different than you say it is, and the case is true that we are seeing case after case in northern Ontario where people are not receiving the services they deserve. You throw one lot of one-time money at a situation of cardiac waiting periods in the city of Sudbury and think you've solved the problem, but everybody knows you haven't. Demand is increasing, you're right about that, but you have made no permanent solution. When are you going to come up with a permanent solution to the problem of the long waits in cardiac care, waits that are absolutely unexampled under any other jurisdiction? When are you going to come up with that solution?

Hon Mr Wilson: What the honourable member is showing is volume. There are more patients, true, because the population is growing and aging, and that's why we're restructuring the system as quickly as we can, but the waiting time for that larger number of people is shorter than it's ever been in many, many years in the province.

Would you admit the following? Surgeries are up 35%. Would you please tell the surgeons they're doing a great job, and the nurses also, working Saturdays and Sundays to meet that demand? I'm not sure they can work any harder than they are.

Some $2.7 million has gone in there and, yes, we have asked the Cardiac Care Network, which is in charge of the cardiac surgeries list in this province, to get us a comprehensive plan so that we have a permanent plan in place to deal with these situations. But let's not deny the fact that surgeries are up 35%, that more people than ever are being served in a faster period of time. The population is growing and aging and we all have to be diligent to address the needs of the population, and that's what we're doing.

RENT REGULATION

Mr David Caplan (Oriole): In the absence of the Minister of Municipal Affairs and Housing, my question is for the Deputy Premier. Minister, as you well know, the people of Oriole overwhelmingly sent a message to this government. In my riding, over 20,000 tenants live and contribute to our community of Oriole. As I went door to door, tenants in buildings across the riding told me the same message: that your Bill 96, your so-called Tenant Protection Act, will take away their rights. They know that if they move they'll be faced with higher and higher rents and that landlords will be able to discriminate against them by virtue of their income.

When will this government start listening to the people you are affecting with your decisions? Will you stand in the House today and agree that the only thing in Bill 96 that represents tenant protection is the title, and will you agree to withdraw this bill before it adversely affects the lives of over 20,000 tenants in Oriole and tenants in the rest of this province?

Hon Ernie L. Eves (Deputy Premier, Minister of Finance): I welcome the new member for Oriole to the Legislature. He bears a striking resemblance to a former member for Oriole.

Mr Dalton McGuinty (Leader of the Opposition): You can't have too much of a good thing.

Hon Mr Eves: That's probably correct, I say to the leader of the official opposition.

The government, as I'm sure he knows, held extensive public hearings on Bill 96 this summer. Over 130 groups made presentations during the public hearing process --

Mr Rosario Marchese (Fort York): But you guys didn't listen. I was there.

The Speaker (Hon Chris Stockwell): Member for Fort York.

Hon Mr Eves: He might want to look at some of the amendments that came forward as a result of the public hearing process. For example, property tax decreases will automatically be passed on to tenants. We have proposed an amendment that makes it mandatory for landlords to provide free receipts when requested by --

Interjections.

The Speaker: Minister, we'll wait for the heckling to finish.

Hon Mr Eves: The government, as he knows, has tabled over 70 amendments to Bill 96. I think it proves that we are listening. The whole intent of the bill is to improve maintenance procedures to make landlords more responsible.

He might want to comment on his government's record when it was in power. How is it that rent increases to tenants under the David Peterson government went up 34%?

Mr Caplan: Tenants have very little confidence in the words of this minister and in the actions of this government. The government committed, at the beginning of this process, that you would be protecting their interests. You have not. You should be aware of what people are saying across this province. If almost 60% of the people in Oriole rejected your government, this should give you cause to reflect. I know from talking to my colleagues that the message from their constituents is the same: There is no tenant protection in your rent control bill.

I ask you again to reconsider. Withdraw Bill 96 now and protect tenants from escalating rents, from poor standards and discrimination by landlords. Minister, will you do that?

Applause.

The Speaker: You can't applaud in the gallery, by the way.

Hon Mr Eves: I just wondered, Mr Speaker, if you wanted to recognize the former member for Oriole in the gallery.

The Speaker: I did.

Hon Mr Eves: Commenting on the strength of a by-election victory, I compliment the member on obviously a very well run campaign, but I'm not so sure what that has to do with the issue we're talking about in the Legislature today. I think we still have the same number of seats on this side of the House as we did before the by-election. I'm glad you finally got back to where you started.

I'm surprised that the Liberals have proposed the amendment to remove the cap on guideline increases. I'm not so sure how this would protect tenants in the legislation.

As I said to the member, there are a lot of things in Bill 96 that improve maintenance on behalf of landlords. The whole intent of Bill 96 is to protect tenants while at the same time encouraging people to develop rental stocks so there will be more rental housing in Ontario. That's the whole purpose of the bill.

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BENEFITS FOR OLDER WORKERS

Mr David Christopherson (Hamilton Centre): My question is to the Minister of Labour. Minister, I would point out to you that we have in the House several former workers from the Stewart Hartshorn plant in Renfrew which closed a number of years ago. These workers and their colleagues are members of the United Steelworkers of America and they've been waiting patiently and desperately for benefits due them under POWA, the program for older worker adjustment.

They understand that it's a complicated program. They understand that it requires negotiations between the federal and provincial governments. They even understand that there have been administrative delays in the past. What they don't understand is why you and your government want to reduce the benefits that are owed them to only about 40% of that full entitlement. Minister, I'd like you to rise in your place today, look those workers in the eye and tell them why you want to cut their benefits to only 40% of what they are rightfully owed.

Hon Elizabeth Witmer (Minister of Labour): I certainly would be very pleased to respond to the question that has been raised regarding the workers who are owed money by POWA. Unfortunately, the reason for part of the delay in the payout is based on the fact that this program was not handled as expeditiously as it could have been by the former government.

We have now arrived at a point where we have agreed to some very specific sets of terms and conditions for winding down the POWA program. It was agreed with the federal government that workers eligible for POWA would receive up to 50% of the original value of their benefits. Our staff has been meeting with the POWA recipients and we hope that money, if they have not yet received it, would soon be made available to them.

Mr Christopherson: First of all, I would like to say to the minister, you've been in office for two years. It's starting to get a little bit stale that you want to blame everything on what happened before. You've been there two years. You're the one who hasn't resolved this.

I might point out to you that I have a copy of a letter from the federal minister, whom your office has been working with, wherein they say that in April of this year they upped the ante, where they were prepared to put in enough money that the full benefits could be paid out to these workers who find themselves in such dire straits in terms of their lives and their livelihood. All it took was you and your government to say that you'd be in for your full 30% of the share and they'd get 100%. Now you're telling me today it's 50%.

That's not good enough. This is just to pay for your tax cut -- a couple of cups of coffee for most people in Ontario. For you to stand there and say you're proud of 50% -- unacceptable. The federal government has offered to pay 100%; we just need you to get onside. Minister, you owe it to these workers to stand up and say you will make sure they get all the money --

The Speaker (Hon Chris Stockwell): Thank you. Minister.

Hon Mrs Witmer: I am extremely proud of this government's efforts to fix the POWA application logjam. There were over 5,000 people waiting for funding from POWA. Some of these people have been waiting up to four years. Unfortunately, it was not handled well by the NDP government. I will indicate to you that there was an agreement reached between the federal government and the province in December 1996. Unfortunately, prior to the last federal election, the federal Liberal government decided to change the arrangement. It was very convenient.

Mr Christopherson: They opted in April and you know it.

The Speaker: Order. I caution the member for Hamilton Centre to come to order.

INVESTMENT IN ONTARIO

Mr Dan Newman (Scarborough Centre): My question is for the Minister of Economic Development, Trade and Tourism. The importance of foreign investment to Canada has been highlighted once again in a recent study by John McCallum, the chief economist for the Royal Bank of Canada.

Not only does Ontario receive more jobs and more money through foreign investments, but we also benefit from new technologies and innovations. The openings and expansions of many companies within the past year, such as RSL Manufacturing in Scarborough, the Glaxo Wellcome investment of $120 million in Mississauga, the 3,000 new jobs announced by Sprint Canada and the new ING Direct call centre in North York, are all certainly great news for the GTA that our government should be very proud of indeed.

But I continue to see news articles that say we need more direct investments and that Canada's share of direct capital is not enough. My constituents in Scarborough Centre want to know that Ontario is doing its job. Can the minister please inform the House what our government has done to attract foreign investment?

Hon William Saunderson (Minister of Economic Development, Trade and Tourism): I'm very happy to respond to the question from the member for Scarborough Centre. Our government has been very proactive and very aggressive in establishing Ontario as a first-in-mind concept when it comes to foreign investment. We've improved the business climate in Ontario significantly and we are committed to doing much more.

Last year, as you may know, we launched Market Ontario, which is a very aggressive investment attraction campaign. The object of this campaign is to raise Ontario's profile and build awareness of Ontario's favourable business climate. We want to target markets and we want to target them worldwide.

Since last November, we have launched a major advertising campaign and we have engaged in media relations and initiated direct marketing activities, including investment missions, trade shows and corporate calls, in which I am pleased to say I actively participated.

I was gratified to learn from the Globe and Mail Report on Business last Thursday that one of the groups I met with on behalf of the Ottawa-Carleton --

The Speaker (Hon Chris Stockwell): Supplementary.

Mr Newman: I just want to take the opportunity to commend the minister on the fine job he's been doing and to let him know that his efforts are resulting in more jobs in my riding of Scarborough Centre.

Attracting foreign investment can't simply be looked at as a one-time deal. I'm sure launching Market Ontario was just one of the many initiatives on the part of our government. Can the minister assure my constituents in Scarborough Centre that there is a long-term strategy in place to make Ontario the best place in the world to invest?

Hon Mr Saunderson: In regard to the supplementary, I would like to say that I'm happy to announce that MBNA Corp, a large bank in the United States, will be coming to Ontario very shortly and establishing itself in the Ottawa region. This is going to create a lot of jobs, and I'm pleased to say that our ministry and our government worked very closely to make this investment happen. It'll create a lot of jobs and a lot of economic activity.

We have already started with our second wave of advertising in the United States, the United Kingdom, Japan and Germany. We have upcoming direct marketing projects in mind, which will be targeting the investment decision-makers around the world, to put Ontario back on the radar screen. The reason we have to do this is that the previous two governments worked in such a way that they discouraged investment in Ontario. That's why we are doing all we can to promote investment in Ontario.

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GOVERNMENT'S RECORD

Mr Alex Cullen (Ottawa West): In the absence of the Premier, my question is to the Deputy Premier. As you know, the voters in Ottawa West sent Mike Harris a message. They overwhelmingly repudiated the government's program. While many said that dealing with debt and deficit was important, they overwhelmingly said that this government is going too far too fast with its cuts to health care, its cuts to education and the downloading of the costs of provincial services on to property taxpayers.

My question is: Will this government listen to the people? Will you honour your promise not to close hospitals, not to harm classroom spending, and recast your downloading package to ensure that property taxes will at the end of the day be lowered?

Hon Ernie L. Eves (Deputy Premier, Minister of Finance): I welcome the honourable member to the Legislature of Ontario and congratulate him on his by-election victory. To answer his question directly, first of all, we are increasing health care spending in this province. We are spending this year $18.5 billion on health care in Ontario. I realize that his former leader promised only to spend $17 billion a year on health care, but we're spending $1.5 billion more than that. I trust he will find that to be acceptable.

With respect to classroom education, we're trying to put the dollars where they're supposed to be spent, benefiting students in the classroom as opposed to administrative expenditures.

With respect to the Who Does What exercise in municipalities, he might want to take the advice of his predecessor, who said that the downloading responsibilities can be absorbed, said that the region of Ottawa's estimate of $82 million in new costs is inflated and vowed not to raise taxes. I don't see where your predecessor thinks there's a problem.

Mr Cullen: I'm pleased that the member opposite is engaged in campaigning for my predecessor. I hope he has sent his cheque. The facts are that during the last election the Premier promised not to close hospitals, promised not to harm classroom spending, and most recently pinkie swore that provincial downloading to municipalities would be revenue-neutral. However, the voters in Ottawa West are not five-year-olds and they want to know what tangible action this government will take, what the course taken will be, how this government will show that it clearly heard the message that has come through the people of Ottawa West and elsewhere through these by-elections.

Hon Mr Eves: The government listens to the people of Ontario every day. That is why with respect to the Who Does What exercise we have set aside over $1 billion in transitional funding to help municipalities through this two- or three-year period of time.

If the honourable member is so concerned about expenditures, why would he, when he was a regional councillor, vote for a 23% pay increase for himself, which increase would --

The Speaker (Hon Chris Stockwell): New question, third party.

SMALL BUSINESS

Mr Tony Martin (Sault Ste Marie): My question is for the Minister of Economic Development, Trade and Tourism. Last week, Minister, your finance minister stood in this House and painted a rosy picture of the economy, told everybody, "Be happy, don't worry."

This weekend we picked up the newspaper and saw 1,600 out of work at Olive Garden/Red Lobster as they go under.

Interjection: That's funny.

Mr Martin: I have a letter here that I got last week from the Ontario Restaurant Association. Laugh at them if you like.

"I have enclosed for your information a copy" --

Interjection.

The Speaker (Hon Chris Stockwell): Can the member for Scarborough East come to order, please.

Mr Martin: Small business is going down the drain, 1,600 people lose their jobs and all these folks across the way can do is laugh. I have a letter here from the Ontario Restaurant Association. They say: "I have enclosed for your information a copy of the Ontario Restaurant Association's latest industry economic snapshot." Did you get this, Minister? "As you can see from the analysis, Ontario's restaurant and foodservice industry has hit an all-time high in bankruptcies and is lagging well behind the rest of Canada in sales and receipts."

What is it, Minister, boom or bust? We're confused over here. Small business entrepreneurs out there are concerned and afraid. Workers are losing their jobs. What are we to believe: what your government spins out as the truth or what is turning up on the streets of our communities for small business and workers every weekend?

Hon William Saunderson (Minister of Economic Development, Trade and Tourism): I'm very pleased to respond to the question of the member for Sault Ste Marie. As he is, I am very concerned and all our members are concerned when people lose their jobs. The restaurant industry is the quintessential small business in this province, in fact in this country. The member certainly knows that this government has been trying to help small business ever since its election. It is our priority to help business, particularly small business.

Let me just say to him a few of the things we have been doing to help small business, the very industry he's talking about. We will have reduced the personal income tax by over 30% over the next three years. We have established the red tape commission. We've reformed the Workers' Compensation Act. We've eliminated the employer health tax on the first $400,000 of payroll, and that means that over 80% of businesses in Ontario will no longer have to pay this.

For him to stand on his --

The Speaker: Thank you.

Mr Martin: Speaker, he never answers my questions. These people are going bankrupt, Minister. They go on to say:

"The broader implications of these disturbing economic trends will be felt in the area of youth unemployment. Currently, the restaurant and foodservice industry employs over 40% of all youth workers employed in Ontario. The prolonged economic difficulties faced by the restaurant and foodservice industry have significantly limited the industry's ability to hire new young workers."

In my own community we did a study about a year and a half ago that said your government is going to lay off 1,600 workers, and that will then affect the private sector. This weekend we found out that Red Lobster is closing -- 46 workers in the private sector out on the street.

Will you admit today that your government's lack of a real economic plan is hurting small business and hurting workers? Will you admit that your own lack of leadership is beginning to show? Today it's the hospitality industry. What will it be tomorrow?

Hon Mr Saunderson: The member should know that in the month of August there were 33,000 jobs created in this province. Since March of this year 158,000 jobs have been created. Since we were elected in June 1995, almost 250,000 net new jobs have been created.

Seeing that the member did his share of quoting, just let me share with you a letter that I received from Judith Andrew, who is the head of the Canadian Federation of Independent Business: "I think the proof is already there. You are seeing real, positive economic numbers here in the province. If these types of policies weren't working, you wouldn't have that."

Mr Paul Oliver, who is president of the Ontario Restaurant Association, in the Globe and Mail recently said, "Certainly for industries such as the food industry, anything that puts money back in consumers' pockets is a positive initiative."

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SOCIAL ASSISTANCE

Mr Gary L. Leadston (Kitchener-Wilmot): My question is to the Minister of Community and Social Services. I've heard from a great number of my constituents in Waterloo region regarding the welfare reforms in Ontario. Many of the calls are very supportive and very pleased with what we are doing. How does Waterloo region area compare with the progress that has been made around Ontario?

Hon Janet Ecker (Minister of Community and Social Services): I'm very pleased to report that, as we've mentioned in this House previously, we've seen unprecedented drops in the number of people on welfare in Ontario; across the province 218,000 individuals who no longer have to rely on welfare. I'm very pleased that in the Kitchener-Waterloo area we have seen a similar drop and we have 3,000 fewer cases of people trapped on welfare. That's a 14% drop and that's unprecedented.

We know that is not only because of the strengthening economy, more jobs -- we've heard from my colleague about the job growth in this province -- but also because of our welfare reforms like Ontario Works, our work-for-welfare program. Forty-two communities are involved now, it's up and running, steadily expanding across the province. I'm very pleased that Waterloo was one of the initial sites that volunteered to participate.

Mr Leadston: How are the taxpayers of Waterloo region going to benefit from this reduction in welfare payments?

Hon Mrs Ecker: One of the good things about this, if you will, is that everyone benefits from these changes and the results that we have had. Not only do those individuals who no longer have to rely on welfare benefit because most of them are now in paid jobs where they want to be, but also the taxpayers benefit.

In the Waterloo region the taxpayers have saved $5.6 million. That is a significant saving for them and I know that the municipal leaders will be able to use those savings to, for example, help hold down property taxes; or, if you were to look at what those savings could buy the taxpayers in that region, it would translate out to 70 additional police officers, just to give you some understanding of the scope of those savings. That's good news, and we're very proud of the work that we've been able to do in this regard.

WATER QUALITY

Mr Frank Miclash (Kenora): My question is to the Minister of Environment. The Minister of Environment will know that, through much correspondence and conversations with the town of Sioux Lookout, myself, my office, the mayor of Sioux Lookout, they are in trouble in terms of their water supply. He will also know that a boiled water advisory was put on to the residents for their drinking water by the northwestern health unit. It's been in effect for months and it will be in effect until they are able to get rid of the contaminants in their drinking water.

You will also know that the town of Sioux Lookout has an application in to bring safe drinking water to their citizens. Can you update us on the status of that application?

Hon Norman W. Sterling (Minister of Environment and Energy): The member did speak to me with regard to the program, the program being the provincial water protection fund, which has some $200 million to deal with problems like the member has outlined with regard to Sioux Lookout.

The ministry is now going through several applications by municipalities across this province which might have problems with regard to their drinking water quality and we will be prioritizing those with regard to which ones are in most urgent need.

The whole program was based first on environmental and health concerns and therefore I'm very hopeful that Sioux Lookout will be one of the successful applicants to this program.

Mr Miclash: I'm asking you today about that program you announced at AMO, which you did with much fanfare. I'm asking you today on behalf of the residents of Sioux Lookout when they can expect to be on your priority list or where they are on that priority list, when they can expect the funds to flow so they can get safe drinking water, something that most communities throughout Ontario assume they have. I'm asking you today when the people of Sioux Lookout will hear from you and your ministry and can turn on their taps and actually know they have safe drinking water. The question is, when?

Hon Mr Sterling: To be fair to all the municipalities, it is necessary to have a small amount of time pass between the announcement and the ability of those municipalities to put forward their plans with regard to this particular item. The budget did call for the expenditure of $40 million this fiscal year with regard to this program, so I expect the decisions with regard to the funding to be made in the very near future.

PUBLIC HEALTH

Mr Gilles Bisson (Cochrane South): My question is to the Minister of Health. You would know that last week I asked a series of questions in this House with regard to the northern regional genetics program. Your ministry is offloading that particular program, along with others from the health units in northern Ontario, on to local municipalities in your municipal downloading exercise. You would also know that municipalities in the north have already indicated that they're not going to be able to find the fiscal room to keep that program alive for northerners. It will mean that southern municipalities will have access to that particular program because it's paid through hospital and university budgets, but in the north we will lose the service.

Last week to the Premier, in a follow-up on another question, he seemed to indicate that your ministry was prepared to make sure that the provincial funding was in place for the northern regional genetics program. Could you please confirm that, Minister?

Hon Jim Wilson (Minister of Health): I've said all along and the Premier confirmed on September 10 that the ministry has been working with local health officials on ways to ensure that the program continues. We've indicated we'll continue the funding for the program.

Mr Bisson: This is the bizarre part, Minister. When I asked the question last week in the House, the Premier seemed to say the same thing as you, that you as the provincial government will ensure that this program stays in place. He left the impression that the province was going to pay for the funding. But when I talked to the Premier afterwards in the House, he looked back at me and said: "Of course I don't mean the province. I mean the municipality." Who am I to believe?

Your parliamentary assistant talked to us on Thursday after a late show question and seemed to indicate that your ministry was prepared to fix this problem. You understand the problem. Northern municipalities and patients understand the problem. If you don't step in, we'll lose that service in northern Ontario and the south will have the service because it is paid through hospital and university budgets. Minister, will you use provincial dollars to ensure that this program stays in place for northern residents, yes or no?

The Speaker (Hon Chris Stockwell): I just ask the House to come to order so we can hear the answer. There are a lot of meetings taking place.

Hon Mr Wilson: The answer is yes.

NORTHERN ONTARIO HERITAGE FUND

Mr Bert Johnson (Perth): My question is for the Minister of Northern Development and Mines.

The government has focused on ensuring that all the people of Ontario are getting the services they deserve at a price they can afford. A major step in accomplishing this goal is securing the accountability of government. Members of this House are aware that in the past there have been concerns about the northern heritage fund, which is allocated to protect the future of those who live in northern Ontario. Questions have centred on whether the government is truly investing funds in the north, and if so, whether this money goes beyond the ordinary budgets of various ministries.

Can the minister please confirm for the House that funds are being allocated to help those in northern Ontario, that the funds are in fact being used in Ontario and explain what the money is being used for.

Hon Chris Hodgson (Minister of Natural Resources, Northern Development and Mines): I want to thank the member for his question. I'm pleased to inform the House and the members of his riding that the money is being spent since last October, when the Premier, the Treasurer and I, with a board comprised of northerners who volunteer their efforts at $1 a year, announced the new terms of reference and new focus for the northern Ontario heritage fund. We reinstated the $60 million plus interest that the previous government had taken from the fund back into the fund. We have invested $22 million in projects, which has leveraged another $33 million in northern Ontario to promote an economic base which all people can build upon.

In the past the fund was focused upon grants to individuals or grants to businesses. We have changed that focus and tried to build an infrastructure that improves not only the economic climate but the infrastructure base, the tourism base and the strategic partnerships across northern Ontario that individuals in business can then build upon, create their own opportunities and improve the economy in northern Ontario.

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PETITIONS

VEHICLE REGISTRATION FEES

Mrs Lyn McLeod (Fort William): I have a petition to the Legislative Assembly of Ontario.

"Whereas the new Mike Harris northern vehicle registration tax does not recognize the uniqueness of the north; and

"Whereas Mike Harris should know that gas prices are higher in northern Ontario; and

"Whereas the new Mike Harris northern vehicle registration tax is blatantly unfair to the north; and

"Whereas we have no voice for the north fighting for northerners around the cabinet table;

"Therefore, we, the undersigned, petition the Legislative Assembly to revoke the new tax imposed on the north and convince the Tory government to understand that indeed northern Ontario residents do not want the new Mike Harris vehicle registration tax."

This is signed by a number of my constituents, and I have affixed my signature in agreement with their views.

CANCER PREVENTION

Ms Marilyn Churley (Riverdale): I have more petitions from people about preventive cancer care. It reads:

"Petition to the Legislative Assembly of Ontario,

"Whereas cancer claims in excess of 20,000 lives annually in Ontario alone; and

"Whereas cancer treatment costs Ontario taxpayers in excess of $1 billion annually; and

"Whereas the best way to fight cancer or any disease is through preventive measures; and

"Whereas the Ontario Task Force on the Primary Prevention of Cancer has advised the government to set realistic and realizable targets for phasing out the release of environmental toxins; and

"Whereas the Legislative Assembly on April 18, 1996, passed a resolution to that effect with support from all three parties;

"We, the undersigned, petition the Legislature of Ontario as follows:

"The Premier and the Minister of Health should immediately implement the April 18 resolution and strike a working committee to begin the task of setting realistic targets for the phase-out of persistent bio-accumulative environmental toxins."

I affix my signature to this petition because I fully support it.

SECURITY OFFICER

Mr Dan Newman (Scarborough Centre): I have a petition signed by hundreds of residents from 10, 30 and 40 Gordonridge Place. They are again quite concerned that their security guard has been moved from Gordonridge to another area in the Metropolitan Toronto Housing Authority. The petition reads as follow:

"To the Legislature of Ontario:

"We, the tenants of Gordonridge Place, have taken this petition in hopes of having our security officer, Jamie Dunham, placed back in our Gordonridge project."

It says, "Keep up the good work."

I have signed this petition, because I think it's worthwhile, and I'm behind the people at Gordonridge in their quest to have their security officer back.

HOSPITAL RESTRUCTURING

Mrs Lyn McLeod (Fort William): I have a petition to the Legislature of Ontario.

"Whereas the undersigned residents living in the city of Thunder Bay in northwestern Ontario are in need of a new regional acute care hospital situated in the city of Thunder Bay to provide the said residents with quality health care services in a modern and up-to-date acute care hospital; and

"Whereas the partial renovation and restructuring of the existing Port Arthur General Hospital, a 65-year-old outdated and antiquated hospital building, proposed by the health services review commission and the Minister of Health for the province of Ontario, will not be suitable, adequate or proper to provide such quality health care services to the said residents; and

"Whereas the undersigned residents endorse and support the Thunder Bay Regional Hospital and the trustees of the hospital board in their vision of a new centrally located hospital to serve the northwestern Ontario region;

"We, the undersigned, petition the Legislature of Ontario to reverse the decision and direction of the health services review commission and the Minister of Health to have all acute care services for the city of Thunder Bay and northwestern Ontario region delivered from the renovated and restructured site of Port Arthur General Hospital and to endorse and approve capital funding to build a new, centrally located acute care hospital in the city of Thunder Bay."

This has been signed by another 246 residents in my community, and I again sign my signature in agreement.

LONG-TERM CARE

Mr David Christopherson (Hamilton Centre): I have a petition to the Legislative Assembly of Ontario from members of Locals 183 and 633 of the Service Employees International Union in Belleville.

"To the Legislative Assembly of Ontario:

"Over 80,000 men and women live in nursing homes and homes for the aged in Ontario. Many of these residents have made enormous contributions to our society over the years and yet today, due to inadequate funding, our older citizens, our parents, relatives and friends, are being warehoused. Caregivers in these facilities are run off their feet trying to do the jobs they were hired to do, but day after day they go home feeling stressed and guilty because they are not able to provide the kind of emotional and physical care they feel the residents deserve.

"As more and more hospitals are being closed, nursing homes and homes for the aged are being asked to care for sicker, older and more mentally fragile residents without the corresponding increase in resources needed to provide good care.

"Therefore we, the undersigned residents of Ontario, demand that the Legislature of Ontario stop the underfunding of nursing homes and homes for the aged; immediately establish and adequately fund a minimum standard of 2.25 hours of nursing and personal care for each resident, each day, in homes for the aged and nursing homes; ensure that long-term care remain the responsibility of the province -- any downloading to the municipalities will result in uneven standards across the province; ensure that long-term care remain in public hands and that it not be sold to private, for-profit nursing homes; and ensure dignity, rights and respect for all residents and workers in nursing homes and homes for the aged."

I add my name to theirs.

SECURITY OFFICER

Mr John O'Toole (Durham East): It is my pleasure to present a petition on behalf of the member for Scarborough Centre. There's been a virtual outpouring of petitions in support of the member for Scarborough Centre, but he left this on the desk so I'm going to present it.

"To the Legislature of Ontario:

"We, the tenants of Gordonridge Place, have taken this petition in hopes of having our security officer, Jamie Dunham, placed back in our Gordonridge project.

"Please keep up the good work."

There were so many petitions that I think the member, Mr Newman, just inadvertently dropped it.

VEHICLE REGISTRATION FEES

Mr Frank Miclash (Kenora): I have a petition to the Legislative Assembly that reads:

"Whereas the new Mike Harris northern vehicle registration tax does not recognize the uniqueness of the north; and

"Whereas Mike Harris should know that gas prices are higher in northern Ontario; and

"Whereas the new Mike Harris northern vehicle registration tax is blatantly unfair to the north; and

"Whereas we have no voice for the north fighting for northerners around the cabinet table;

"Therefore we, the undersigned, petition the Legislative Assembly of Ontario to revoke the new tax imposed on the north and to convince the Tory government to understand that indeed northern Ontario residents do not want the new Mike Harris vehicle registration tax."

I have affixed my name to that petition as well.

IPPERWASH PROVINCIAL PARK

Mr Bud Wildman (Algoma): I have a petition to the Legislative Assembly of Ontario. It reads as follows:

"Whereas many questions concerning the events preceding, during and after the fatal shooting of Anthony Dudley George on September 6, 1995, at Ipperwash Provincial Park, where over 200 armed officers were sent to control 25 unarmed men and women, have not been answered:

"Whereas the officers involved in the beating of Bernard George were not held responsible for their actions; and

"Whereas the Ontario Provincial Police refused to cooperate with the Special Investigations Unit in recording details of that night;

"Whereas the influence and communications of Lambton MPP Marcel Beaubien with the government have been verified through transcripts presented in the Legislature; and

"Whereas the trust of the portfolio of native affairs held by Attorney General Charles Harnick is compromised by his continued refusal for a full public inquiry into the events at Ipperwash; and

"Whereas the promised return of Camp Ipperwash to the Stony Point Nation by the federal Ministry of Defence and the serious negotiations of land claims by both the provincial and federal governments could have avoided a conflict;

"We, the undersigned, petition the Legislative Assembly of Ontario that a full public inquiry be held into the events surrounding the fatal shooting of Dudley George on September 6, 1995, to eliminate all misconceptions held by and about the government, the OPP and the Stony Point people."

This petition is signed by 42 residents of Ontario and I affix my name thereto.

PUBLIC SERVICE AND LABOUR RELATIONS REFORM

Mr E.J. Douglas Rollins (Quinte): To the Legislative Assembly of Ontario, I have a petition dealing with Bill 136, with some 200 names on it. I present it today. Thank you.

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HOSPITAL RESTRUCTURING

Mr John Gerretsen (Kingston and The Islands): I have another petition that deals with the horrible state of health care in Ontario. This petition goes to the root of that --

Hon Noble Villeneuve (Minister of Agriculture, Food and Rural Affairs, minister responsible for francophone affairs): Oh, come on. Talk to your federal cousins.

Mr Gerretsen: -- as the Minister of Agriculture obviously knows, because he --

The Acting Speaker (Mr Bert Johnson): Can you either read the petition or explain it, one or the other?

Mr Gerretsen: The petition is addressed to the Legislative Assembly of Ontario and it states that:

"Whereas over half the people in Ontario are women;

"Only 5% of the money spent on medical research goes to research in women's health;

"Women have special medical needs since their bodies are not the same as men's;

"Women's College is the only hospital in Ontario with a primary mandate giving priority to research and treatment dedicated to women's health needs;

"The World Health Organization has named Women's College Hospital as the sole collaborating centre for women's health for both North and South America;

"Without Women's College Hospital, the women of Ontario and of the world will lose a health resource that will not be duplicated elsewhere;

"Therefore we, the undersigned, petition the Legislative Assembly of Ontario to ensure the continuance, independence, women-centred focus and accessible downtown location of the one hospital most crucial to the future of women's health."

I have affixed my signature to the same.

COURT DECISION

Mr Bob Wood (London South): I have a petition signed by 151 people. It reads as follows:

"Whereas the courts have ruled that women have the lawful right to go topless in public; and

"Whereas the Liberal government of Canada has the power to change the Criminal Code to reinstate such public nudity as an offence;

"We, the undersigned, respectfully petition the government of Ontario to pass a bill empowering municipalities to enact bylaws governing dress code and to continue to urge the government of Canada to pass legislation to reinstate such partial nudity as an offence."

GOVERNMENT ADVERTISING

Mr James J. Bradley (St Catharines): My petition reads as follows:

"Whereas the Minister of Education intends on taking more than $1 billion out of Ontario's education system at a time when there's an increasing consensus on the importance of supporting our schools and classrooms; and

"Whereas per pupil funding in the province of Ontario now ranks below other jurisdictions, such as Georgia, Kentucky, Missouri and Nebraska; and

"Whereas the Mike Harris government has now embarked on an advertising campaign which will cost the taxpayers of Ontario over $1 million; and

"Whereas the Mike Harris commercial doesn't constitute an important public announcement and instead is clearly an abuse of public funds, because they are self-serving political messages which are designed to influence public opinion; and

"Whereas the Mike Harris government could cancel the advertising campaign and use the $1 million which belongs to the taxpayers of Ontario for the purchase of 40,000 textbooks;

"We, the undersigned, call on the Mike Harris government to cancel their blatantly partisan, self-serving political advertising campaign and redirect the taxpayers' $1 million to classroom funding."

I affix my signature to this petition, as I'm in full agreement with its contents.

ROCK MUSIC GROUP

Mr John R. Baird (Nepean): I have a petition addressed to the Legislative Assembly of Ontario.

"Whereas the rock band Marilyn Manson was permitted to play a concert at the Ottawa Congress Centre on Friday, August 1, 1997; and

"Whereas Marilyn Manson's wilful promotion of hatred, violence, immorality and obscenity has been linked to teen suicides and adolescent crimes across North America; and

"Whereas by allowing Marilyn Manson to perform, the Ottawa Congress Centre, a crown agency with a public mandate, helps to legitimize the band and its unethical messages; and

"Whereas the Ontario Court (General Division) has ruled that Marilyn Manson's music does not meet the definitions of `obscenity' or `hate literature' in the Criminal Code;

"We, the undersigned, petition the Legislative Assembly of Ontario to call on the Liberal government of Canada to amend the Criminal Code in order to ensure that Marilyn Manson and other people directing messages of hate and derision towards vulnerable children and youth are not permitted to perform in Canada and to ensure that messages which offend the moral and ethical sensibilities of Ontarians are not given a voice at venues financed by the taxpayers of Ontario, including the Ottawa Congress Centre."

I am pleased to affix my own signature to that too.

PUBLIC SERVICE AND LABOUR RELATIONS REFORM

Mrs Lyn McLeod (Fort William): I have a petition to the Legislative Assembly of Ontario.

"Whereas the Harris government's Bill 136 will effectively suspend all labour relations rights for municipal, health and school board employees affected by provincially forced amalgamations; and

"Whereas the Harris government's Bill 136 will hurt average workers in every community across Ontario including nurses, teachers, firemen and police officers; and

"Whereas the Harris government's bill will decrease the quality of health care as well as the quality of education delivered in Ontario; and

"Whereas the Harris government's Bill 136 was designed to provide the government with sweeping powers to override long-standing labour negotiation rights for workers including the right to negotiate, the right to strike, the right to seek binding arbitration and the right to choose a bargaining unit;

"Therefore, be it resolved that we, the undersigned, support our MPP Lyn McLeod in her opposition to this legislation and join her in calling upon the Harris government to repeal Bill 136, which creates a climate of confrontation in Ontario."

This petition is signed by a large number of my constituents and I've affixed my own signature in agreement with their concerns.

GAMBLING

Mr Ed Doyle (Wentworth East): I have a petition that is signed by approximately 80 people in a church group in my riding, in which they have expressed some concern about the spread of gambling in the province of Ontario, and I present this petition.

ONTARIO DRUG BENEFIT PROGRAM

Mr Frank Miclash (Kenora): I have a petition that reads:

"To the Legislative Assembly of Ontario:

"Whereas on July 15, 1996, the government of Ontario forced seniors with incomes over $16,018 to pay an annual $100 deductible on prescription drugs;

"Whereas this user fee imposed significant financial hardships on vulnerable seniors;

"Whereas on April 1, 1997, the government of Ontario unfairly and knowingly forced Ontario seniors to pay that $100 deductible again;

"Whereas the time between July 15, 1996, and April 1, 1997, is only eight and a half months and not one year;

"Whereas the Ontario government has wrongly taken an additional $30 million out of the pockets of seniors for prescription drugs;

"Whereas Ontario seniors feel cheated by the government of Ontario and this $30 million ripoff shows a tremendous disrespect for Ontario seniors;

"Therefore be it resolved that the government of Ontario credit Ontario seniors for the three and a half months overpayment they were forced to pay on prescription drugs by making the effective date for the 1998 $100 deductible July 15, 1998, instead of April 1, 1998."

I have affixed my name to this petition as well.

ORDERS OF THE DAY

SELECT COMMITTEE ON ONTARIO HYDRO NUCLEAR AFFAIRS

Hon Norman W. Sterling (Minister of Environment and Energy): Mr Speaker, I seek unanimous consent to move a motion with regard to the establishment of a select committee on Ontario Hydro nuclear affairs, without notice.

The Acting Speaker (Mr Bert Johnson): Is there unanimous consent? It is agreed.

Hon Mr Sterling: I move that a select committee on Ontario Hydro nuclear affairs be appointed to consider and report on the Nuclear Performance Advisory Group's independent integrated performance assessment from the perspective of the performance and reliability of Ontario's nuclear facilities, and in particular:

To examine the Atomic Energy Control Board report on the findings of the independent integrated performance assessment and to make recommendations on safety principles relating to training and implementation plans;

To examine the costs and environmental impacts of the nuclear recovery strategy, including Ontario Hydro's financial justification of its nuclear recovery strategy; the economics and viability of alternative supply options; and environmental impacts of specific components of recovery and means to address and mitigate these impacts;

To examine any other matters that the committee considers relevant to the above terms of reference;

That the committee present an interim report to the House by October 3, 1997, and a final report by December 1, 1997, or on a date to be determined by the committee, provided that if the House is not sitting, the committee have authority to release its report by depositing copies with the Clerk of the assembly and, upon resumption of the sittings of the House, the Chair of the committee shall bring such reports before the House in accordance with the standing orders;

That the committee have the authority to meet at the call of the Chair;

That the committee have full power and authority to employ counsel and such other personnel as may be deemed advisable and to call for persons, papers and things and to examine witnesses under oath; and

That the said committee be composed of the following members:

Mr Shea, Chair, Mr Kwinter, Vice-Chair, Mrs Johns, Mr Galt, Mr O'Toole, Mrs Fisher, Mr Conway and Mr Laughren.

The Acting Speaker: Mr Sterling moves that a select committee on Ontario Hydro nuclear affairs -- dispense? Dispense.

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Hon Mr Sterling: Thank you very much, Mr Speaker, for your efficiency.

At the outset, I would like to indicate I'm splitting my time with the member for Northumberland, Mr Galt.

This is a different occasion for the Legislature of Ontario in present times. This is, I think, the first time for a long time that a select committee of the Legislature has been set up. When I was first elected some time ago -- that was in 1977, Mr Speaker, for young fellows like you -- there were several select committees sitting at that point in time and it was quite a common parliamentary practice. I can remember select committees on such wonderful subjects as tile drainage, chaired by our friend Lorne Henderson from Lambton county.

Mr Bud Wildman (Algoma): I could never figure out why they went to Arizona.

Hon Noble Villeneuve (Minister of Agriculture, Food and Rural Affairs, minister responsible for francophone affairs): No, they went to Florida. It's very wet down there.

Hon Mr Sterling: I'm sorry to raise that, because it does bring back so many pleasant memories for the other members opposite who were here at the same time, trying to figure out why that committee travelled to Florida at that point in time.

There was also a select committee on company law, chaired by Mr Breithaupt of the Kitchener-Waterloo area, which also went far afield at times.

However, one of the former select committees which was of real significance to this debate was the committee on Ontario Hydro back in the 1970s. At that time the committee tried to grapple with the long-standing problem of members of this Ontario Legislature gaining control of Ontario Hydro and its day-to-day activities. That committee considered, I believe, four areas of concern and actually operated in a fairly efficient manner and came forward with some fairly good reports. The problem was the implementation of those reports and the implementation of laws and rules and procedures since that time to the present day which have in essence failed to bring Ontario Hydro to heel by the government.

There is of course the necessity of allowing Ontario Hydro to carry on its business on a day-to-day basis, because it's hardly within the capability of any member of the Legislature or in fact any minister to keep his or her thumb on those kinds of activities. Ontario Hydro is a very large corporation. Perhaps a lot of people don't realize the enormity of the institution. Ontario Hydro is the largest capital corporation in Canada. In other words, when you put together all of their assets, let me say, at book value, they would be the largest of all in terms of all of the capital they have. It would be somewhere in the neighbourhood of $35 billion to $40 billion. There is no other corporation in Canada, private, public or otherwise, which has that kind of investment. So we're dealing with a very significant financial giant when we're talking about Ontario Hydro.

As you know, I have been the Minister of Environment and Energy for a little over a year now and immediately upon my being sworn in as the Minister of Energy, I was meeting with Mr Farlinger, then chair of the corporation and now not only the chair but also the president of the corporation on an interim basis. Mr Farlinger stated to me his concerns with regard to the nuclear program of Ontario Hydro. Even at that point there were some signals coming from the Atomic Energy Control Board, which is the regulatory arm of Ontario Hydro, that there were problems in our hydro-nuclear program.

Perhaps I should explain that even a little more. While Ontario Hydro is involved in the running of generators, the transmission of power across the province and the distribution of power, that is, the wires going out to the houses and the businesses in various parts of our province, the actual regulating of the nuclear plants falls under federal government jurisdiction, and their arm or agency is the Atomic Energy Control Board, which is chaired by Dr Bishop. They are our safeguard that Ontario Hydro is following the necessary rules and regulations to ensure that these plants are being run in a safe and efficient manner.

The Atomic Energy Control Board's involvement is in licensing these plants for a period of a year. Commonly in Ontario they have licensed the various plants for a period of two years.

The Atomic Energy Control Board, as well as sitting as an agency body in the city of Ottawa, also has people on site all of the time. When we usually think about an agency or a board which is overseeing the activities of a corporation or something like that, we don't envisage that they actually have people on the ground all of the time. The Atomic Energy Control Board has approximately 10 employees full-time at the Bruce nuclear facility, 10 people at the Pickering nuclear facility and about five at the Darlington nuclear facility.

In December 1996, the licence to operate the Pickering A plant was coming to an end, the two-year period was coming to an end, and the Atomic Energy Control Board was considering that licence again. Ontario Hydro was looking for the usual two-year licence but was told by the Atomic Energy Control that they were only going to get a six-month licence and that certain improvements had to be made with regard to the procedures that they undertook. That required, then, another hearing and decision in June of this year and that licence was given for a nine-month period. So for this last year or so, eight months in particular, the public has become acutely aware of the fact that there was something different going on with regard to the safety regulations in our plants.

Most immediately, in August of this year, we received a report called the --

Mr Sean G. Conway (Renfrew North): IIPA.

Hon Mr Sterling: The IIPA, the independent integrated performance assessment report.

Mr Joseph Cordiano (Lawrence): That's the association Norm was involved in.

Hon Mr Sterling: Yes, the IIPA. That resulted from the fact that shortly after my talk after initially being sworn in as the Minister of Energy, the chairman of Hydro, Mr Farlinger, was so concerned with regard to the nuclear program of Ontario Hydro that he decided, over and above his responsibilities to the Atomic Energy Control Board in satisfying their wants and needs in terms of licensing, he would hire independently some nuclear experts in running these plants.

Unfortunately, because Ontario Hydro really is the nuclear power industry of Canada and it was really not possible within Canada to seek that expertise, Mr Farlinger went to the United States and hired Carl Andognini and a team of six other experts to prepare a report on the status of Ontario Hydro's nuclear program and match that against the experience that Mr Andognini and the other group of experts had with those plants in the United States of America. In other words, they were trying to benchmark what our performance was against what the performance was in the United States for other nuclear facilities.

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In mid-August Mr Andognini prepared his report, which was significant in size, significant in depth and was very extensive in terms of the operations of Ontario Hydro nuclear plants. Mr Andognini not only talked about the Pickering plant, which had had problems with regard to its licensing, but also talked about the eight reactors at Bruce: the one reactor which has been permanently closed down, the three reactors in Bruce A, the four reactors in Bruce B, and the heavy water plant which is in Bruce as well. He also commented on the four reactors in Darlington as well as the eight reactors at Pickering.

It's on the record now that the production of that report caused a significant amount of concern in the public's mind. I was privy to the report a couple of days prior to its release and immediately sent it to Dr Bishop at the Atomic Energy Control Board to ask her what her comments or opinions were with regard to this significant document. The documents in sheer thickness relate to about 12 inches. I don't know how many centimetres that might be, but you'd probably know that. It would be significant in size.

I know that the committee, as do I, would have difficulty in trying to synthesize this report and come forward with conclusions as to the validity of the criticisms Mr Andognini might have made with regard to this report, but I have asked Dr Bishop for her response. Her response is related to in the motion: that the committee will be considering Dr Bishop's response to Mr Andognini's report and that it will be part of the deliberations of the committee.

The primary focus of the report is to ensure that the safety of the reactors and the program will continue and will improve. I guess one of the difficult parts here for the public is to say on the one hand that you have this report which is quite critical, and on the other hand that the Atomic Energy Control Board has said to me that there is no undue risk associated with the operation of these reactors at this time. The problem relates to running reactors safely and efficiently; in other words, running them safely and having them operate 85% to 90% of the time. What has happened particularly over the last four, five or six years is that the reactors are not running nearly long enough to make them economically viable, or as economically viable as we, the taxpayers and the shareholders of Ontario that we are, would like them to be. They can't run them 80%, 85% to 90% of the time like they were running them in the early 1980s at that efficient ratio. They can't run them safely that often, therefore the reactors are shut down for various and different reasons.

That is the real scope of the other part of the documentation that was unveiled in the middle of August: the recovery plan of Ontario Hydro. So first we had in the middle of August Carl Andognini's report, the IIPA report, the safety report which I have referred to Dr Bishop of the AECB to get her comments on.

The second part of the puzzle is the recovery plan Ontario Hydro has put forward as the method of dealing with that and having these reactors operate safely at 80%, 85%, 90% of the time. You always have to close the reactors down for maintenance; you have to change things. Not only the reactors have to be closed down, but the turbines that the heat drives, the pumps. All those kinds of things have to have regular maintenance. Some of them have to be changed. They are very complicated engineering and there is a lot of machinery which has to be tended to. The trick in the nuclear industry is to have these operating at a very efficient rate.

If I could make the difference in terms of what it means for each percentage point of efficiency, as you raise your efficiency from let's say 50% to 55%, where they are operating at this present time, each percentage point by which you can increase the efficiency means about $100 million more to Ontario Hydro in terms of its profitability picture. If you can increase the efficiency of these generators by 30%, you have increased the revenue potential of Ontario Hydro by some $3 billion. Because of the present financial situation of a very large debt load that Ontario Hydro is carrying at this time, improving the efficiencies of these nuclear generators is extremely important to us.

In the middle of August we had the safety report and the recovery plan presented to us. I immediately was in talking with the Premier and Mr Farlinger and indicated to him that as Minister of Energy I thought it was necessary for us to have a public process to deal with both of these reports, (1) to assure the public that these generators were in fact operating in a safe manner, and (2) to assure the public and to bring forward the proper questions to Ontario Hydro that the recovery plan was the best possible plan to bring greater efficiency, better safety and preserve the taxpayers' interest as shareholders of this very large corporation.

That is why we have now put forward in our motion the setting up of the select committee. I believe that the members who have been chosen have a great deal of interest in this particular matter. The chairman, Mr Shea, has before been a member of Toronto Hydro in this area and has had experience in chairing committees. I have every confidence that he will drive this committee forward. Ms Fisher, the member for Bruce, has a tremendous interest in the outcome of the deliberations of this committee. She has near her home the Bruce plant, which I believe has over 4,000 workers in that area. She has spoken to me on numerous occasions of her concern over any shutdown that would occur in that area because of the employment not only directly, but the indirect effects of it on her community up in that area. Mr Speaker, as you know, representing smaller communities, the decrease in the number of jobs can be very significant to those areas.

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There are also other offshoots which are to be taken into account. When you shut down reactors, or in this case if the heavy water plant is shut down, the energy park up at the Bruce nuclear facility is in trouble because they get a byproduct of steam from the heavy water plant, and therefore the government must try to grapple with the downsides with regard to doing that.

I believe, however, that this committee has an opportunity which no other committee or select committee of the Legislature has heretofore had in the province of Ontario. The other document which will be coming forward very shortly -- and I'm making every effort and I want to assure my critics opposite -- I see the member for Nickel Belt listening attentively to my remarks. I'm very cognizant of their interest in getting this document on the table so the deliberations of the committee can be more meaningful and they can therefore deal with the issues, being assured of the government's policy with regard to electricity, electricity competition and Ontario Hydro in the future.

Before the other members rise and talk about the dates, I think it's important to notice, from the actual wording of the motion, that the October 3 date and the December 1 date are there but it is well within the mandate of the committee to postpone those particular dates. I have discussed with the opposition the reason for those particular dates, one being that Ontario Hydro has a board meeting every so often. I think it's important to try to keep Ontario Hydro updated as to the direction the committee might be going in at a particular point in time so that commitments, decisions are not made willy-nilly and in contravention of where the committee might be going in the end.

However, I've also told the members of the opposition, and I've made this quite public, that there are certain decisions which must be made by Ontario Hydro, particularly with regard to safety concerns. If Ontario Hydro decides for safety reasons that certain actions must be taken, I don't believe it would be in the committee's interests or the government's interests or the taxpayers' interests that those decisions be stalled. It may be seen that certain decisions must be made on the economic front as well. However, it's my hope that the committee will be able to work quickly enough and produce enough of a direction to the chairman of Hydro that their work and their recommendations will be taken, and taken seriously, by Ontario Hydro in making their decisions in the future.

As I mentioned before, we have a select committee now that will be charged with a very important task, a task which a lot of people in the province do not clearly understand, nor perhaps did I even clearly understand when I was a member and my attentions were not focused on this very significant corporation, that not only relates to our concern over safety and a corporation which is run by the province of Ontario, but it really goes to our ability to compete in the future with other states, with other jurisdictions, to get jobs for Ontario.

Our overall purpose on this committee should be, number one, safety; number two, the economic issues that spin out of any kind of recovery plan or recommendations we might have for Ontario Hydro, because those economics will determine what electricity rates are going to be in the long term and whether or not we are going to be competitive in Ottawa or we're going to be competitive in Stratford, or wherever in the province, to attract those industries to come here and not go to New York state or Quebec or BC, or whatever, because there is cheaper power in those jurisdictions. It's in our combined interests that we find the best possible economic solution.

Last but not least, as the Minister of Environment, I'm particularly concerned with regard to any of the downsides to the recovery plan to our environment. The Ministry of Environment has been making perhaps the largest moves in terms of trying to deal with air quality that any government has for a long period of time. We've clearly focused our ministry on air quality and on improving our air quality.

Within the last number of weeks I have announced perhaps the largest grass-roots program since the blue box program to engage the public in actually having to take action or to be involved in an environmental program that this province has ever seen, and that was the announcement of the vehicle emissions testing program, which will eventually test 4.7 million cars in the province. That means we will be asking the people of Ontario, like they've never been asked before, to deal with air quality in a very direct manner, and that is to ask them to have the most efficient automobiles they can so that what's coming out of the tailpipe is not bad for our smog in the summer and the rest of the year. We have concentrated on air quality, and therefore I hope that committee will consider those parts of this which will lead to a deterioration in our air quality.

It's my hope that we can find alternatives in perhaps bringing power into this province, in requiring generators to generate power in a most clean and efficient manner, in rewarding those who produce power cleaner than those who produce power from fossil fuel. Those are the kinds of issues I'm sure the committee would like to talk about and like to deliberate on. I only want to make certain, however, that their answers are practical. There is no sense in talking about wind power replacing nuclear power in this province, because if we all had a windmill on our roof probably across the province, we couldn't replace --

Interjection.

Hon Mr Sterling: No, I haven't, actually.

Mr Conway: It sounded like you had.

Hon Mr Sterling: -- all of the nuclear power that we might have to shut down for a period of time. It is compromise, but it's a practical answer that we must come up with on the bottom line.

Never before have we had the convergence of these two kinds of issues. On the one hand, we have had perhaps the greatest call into question of the performance of our nuclear program and the safety of the nuclear program. On the other hand, we are in the throes of an electricity restructuring exercise which this government is committed to and will be going ahead with in the very near future. I believe that the convergence of these two issues together will provide this committee with an unbelievable opportunity to have an influence on the future of not only Ontario Hydro but also the electricity industry in this province, not only in the short term but in the long term.

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Mr Doug Galt (Northumberland): It's certainly a pleasure for me to be able to rise and say a few comments about the Hydro select committee that's in the process of being struck and also the motion to put it in place.

I, like many people in Ontario back in the middle of August, became very concerned when the news came out about the problems that we were having with Ontario Hydro. It's an organization that we in Ontario were very proud of for many years, but with that announcement a lot of concern was created -- concern, first, for reliable power. Certainly the kind of industry that we need in Ontario, if we're going to go ahead economically, needs reliable power, there's just no question. When you see organizations like Ford saying that 10 years ago the cheapest power in the 17 regions where they produce cars was here in Ontario and now it's in something like 13th or 14th place, back in 1995, in 10 years they moved down a long way in the price of power. That's a second concern that I would see that most people in Ontario had when this announcement came out: What on earth is power going to cost in the future?

Ontario Hydro is already $30 billion plus in debt, and with the interest on that debt, along with the problems we now have with nuclear power, there's a tremendous amount of concern with that, and also the safety at the three locations where we have nuclear power. What about the residents in those areas? It's great to have the assurance from the Atomic Energy Control Board that there is no immediate risk in the near future.

I'm very pleased to realize now just how the Ministry of Energy responded to the concerns that were expressed a year ago. We realized that Candu reactors were working better in other parts of the world than they were in Ontario and something wasn't quite right, so this commission was struck to do the assessment and that report came in with some rather unnerving information, to say the least. It's also great to see this government is responding to that assessment and is going to do something by appointing a select committee which is going to represent all three parties. I hope it operates in a very non-partisan way with the main objective to do something for and give some guidance and direction to this monopoly that we have in Ontario Hydro.

I know that for everyone in this Legislature, the safe, reliable and efficient operation of Ontario Hydro's nuclear facility is certainly a very top concern. I'm very pleased that the Legislature has agreed to form this select committee on Ontario Hydro nuclear affairs to scrutinize Ontario Hydro's nuclear recovery plan and its economic and environmental implications for Ontario. The committee will be chaired by the member for High Park-Swansea, who has had many years as a commissioner for electricity for the city of Toronto, and the Vice-Chair will be the member for Wilson Heights.

As the members know, Ontario Hydro's independent integrated performance assessment report made serious assertions about these operations, some that hit the headlines and indeed created considerable concern in Ontario. The Atomic Energy Control Board of Canada has assured us that the Hydro reactors do not constitute an immediate safety risk. I think that's important to really emphasize, that these things are not going to have a meltdown or blow up or have a very serious accident in the near future. They are safe in the way that they are operating. However, we realize that down the road they do need to be looked after and taken down and repaired and brought up in a proper sort of way.

Ontario Hydro has since released a nuclear recovery plan for bringing its reactors up to superior industry standards. I guess there's a lot of concern there in how much that's going to cost. A lot of figures have come out over the last while. We're talking in billions of dollars and we also hear of more billions of dollars in decommissioning these down the road, so it's obvious why the residents of Ontario are very concerned about the cost of Hydro in the future.

I believe that an urgent review of the Ontario Hydro plan by provincial public policymakers is necessary on a timely basis to ensure that the utility is kept on track. We must protect the best interests of both ratepayers and taxpayers in the province of Ontario. I certainly look forward to serving on this committee, along with the members for Bruce, Huron and Durham East, as well as the member for High Park-Swansea and the three members from the opposition and third parties. I think it's going to be a very interesting committee to work on. It looks like it's going to be an exceptionally busy committee, as we look at the reports and the time frame of getting those in.

Thanks very much to the opposition critics and the House leaders for their cooperation in developing this proposal for the committee and its mandate. They're to be congratulated for recognizing that the problems that have occurred at Ontario Hydro transcend several governments and transcend partisan politics. Certainly the problem didn't just happen the other day. The problem has been evolving for some time, maybe even back to previous Conservative governments. I don't think, as we head off on this, we should think along partisan lines at all, but should think very objectively as to what kind of report we can put together for the people of Ontario.

I'm certainly very pleased to be able to report that the committee has been empowered to call upon witnesses and the documentation that we may need to examine. We look forward to scrutinizing the independent integrated performance assessment report and the findings of the Atomic Energy Control Board of Canada report that was requested last month.

Our committee has been asked to return interim findings to the Legislature by October 3, with a final report submitted by December 1. It's going to be a tremendous amount of work by this committee and I'm pleased to see that there is some flexibility in those dates. The committee will establish its own meeting schedule at a preliminary meeting later this week. As I said earlier, I certainly look forward to working with these various committee members on Hydro's future directions.

The Acting Speaker (Ms Marilyn Churley): Further debate?

Mr Conway: I want to rise this afternoon to share the opening time with my colleague Mr Phillips, the member for Scarborough-Agincourt, as the minister shared his time with Mr Galt. I hope it meets with the approval of the House that I will do that. I will take some of the time and the shadow chancellor, my friend from Scarborough, will take up the other portion.

We have, as has been indicated, a committee reference today to establish a select committee on Ontario Hydro. The specific reference is to Ontario Hydro's nuclear affairs. I want to support the motion and take a few moments this afternoon to indicate why.

We have, as the minister indicated, had precedent in this connection before. It was in 1976 that Mr Davis, as Premier, appointed a select committee -- late 1975, actually; it might have been 1975. Right after the minority election of that year, a select committee on Hydro affairs was established under the very capable leadership of Donald C. MacDonald, long the member for York South and for several years the leader of the CCF-NDP in Ontario. I had the privilege of serving on that committee for some, though not all, of its reference. The fact that the committee did its work in a minority government environment from 1976 to 1980 I think probably made it a more balanced and more effective committee than might otherwise have been the case.

Several bromides have been offered here this afternoon, the best perhaps by the previous speaker from Northumberland, that we ought to remember that this is all above and beyond politics. I don't know that I can accept that, though I understand where that instinct might come from. It's my experience, I say to my friend the Minister of Agriculture, and he probably will not disagree, that in Ontario there has been nothing more essentially political than electricity and Ontario Hydro. We would all do well, I think, to understand that. It's been an intensely partisan issue but it's been a very fundamental issue.

Mr Villeneuve's predecessor, the late Osie F. Villeneuve, long the member from Glengarry, used to talk about the number of campaigns he had been through in that wonderful part of southeastern Ontario where rural electrification was the central and only question.

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My grandfather served here from 1929 to 1945, and he to his dying day recalled with lurid interest the great political scandals that Hydro produced in this province in his time. I have said before and I will repeat now, particularly for those free-marketers down on Bay Street, that the best, the most delicious, the most intriguing of all political scandals in the post-Confederation history of Ontario have been power and Hydro scandals. Many of them are richly detailed in our library. But is it political, Hydro? You bet. You ask the farmer on the fourth concession of Rawdon township or the retail clerk in the middle of winter in Pembroke, Ontario, "Is Hydro political?" Absolutely, because it cuts to the core of our economic and social wellbeing.

I think one would have to be particularly naïve to imagine that we're going to debate this question above and beyond politics. The great sponsor of Ontario Hydro, Adam Beck, understood the small-p and the big-P political potentials of electricity better than anyone before or since. I'm not going to bore you today with that most marvellous of modern politicians, Adam Beck, but boy, we could all learn from his play book. In fact, I was just reading earlier the plaintive squeals of Premiers -- Tory, farmer -- who just said, "God, if we could only get the truth out of that man, if we could only get the whole story out of that man, if he would just stop blackmailing us, if we could just get the truth." This is not some caterwauling oppositionist; these are Premiers of this province.

At any rate, we've got a committee reference before us today. I support it, and I want to say again what I've said on several occasions publicly and privately over the last number of weeks: I believe that this Legislature has a duty to the Ontario taxpayers and to Hydro ratepayers to inquire into two basic questions in a rigorous and timely fashion. The first of those questions is simply this: What has gone wrong at the nuclear power division of Ontario Hydro, which power division now produces roughly three fifths to two thirds of all the electricity in the province?

The minister observed that this summer Mr Andognini, the executive vice-president of Ontario Hydro, tabled at the Hydro board in mid-July a remarkable report, the so-called IIPA report. Within a very few days the Hydro board announced its response: a multibillion-dollar recovery plan that among other things seeks to lay up -- a wonderful Hydro phrase. Only the Hydrocrats would come up with a phrase like that. "We're going to lay up," they say, "fully 33% of the operating reactors in the province and set aside, not use, 4,200 megawatts of installed capacity." That's a dramatic withdrawal of capacity for whatever reason.

They go on to tell the farmers of Hastings and the young men and women of Stoney Creek: "Don't worry. We going to do all this and it's not going to affect the financial health of the corporation and it's certainly not going to affect your rates." Yes, Virginia, there is a Santa Claus.

It is perhaps for old fogies like Mr Laughren and myself to observe just how remarkable was the event of August 12 or 13, whenever that was, in mid-August of this past summer, that the acting president and chair of the Hydro board, Bill Farlinger, came forward to announce the recovery plan and to release the independent integrated performance assessment report that was done by these US consultants on the nuclear power capacity at Ontario Hydro.

Not to be indelicate, but what we saw that day in mid-August was Ontario Hydro coming into the public domain and basically undressing and saying that every complaint that had ever been made against it, particularly against its nuclear power capacity, was true and more than true. Unbelievable. I'm sure Norm Rubin and his friends could hardly contain themselves, I know the CBC could not contain itself, and at one level I suppose I understand their stupefaction, their incredulity, their joy, because the Hydrocrats were admitting now that this grand nuclear experiment had been much less than had been promised. Mrs Fisher is here and she knows better than I what the reaction was in a community like Kincardine when that report was made public -- an unbelievable confession, so remarkable, so unbelievable, so swift, so comprehensive, so unexpected as to make an honest person wonder if more was going on than met the eye.

I said before and I will repeat now that I am not given to conspiracy theories, but I must say that one could certainly be justifiably sceptical about the events that led up to the release of the IIPA report and the Hydro recovery plan. I take issue with the minister in a couple of areas, although I thought he acquitted himself in a very ministerial fashion today. Reading from Mr Kupcis's letter of resignation, he said, and I quote from his letter dated August 12, "As disturbing as I find the consequences of the IIPA report, I, Al Kupcis, am very proud of the fact that I commissioned that report." Bill Farlinger didn't commission the report, as far as I know, and according to Mr Kupcis's letter, he said, for the record, "I commissioned the report."

Interjection.

Mr Conway: He was the president, that's correct. You just said, Minister, that it was Mr Farlinger who had launched this report, and I wanted to correct the record at least with reference to Dr Kupcis's letter. You shrug your shoulders, and we'll come back to that shrug momentarily.

It was very interesting. What did we get once the report went public on I think August 13? The quiet summer of 1997 was interrupted by what I could best describe as a big bang, and the first reaction was that the president of Ontario Hydro resigned forthwith. Dr Kupcis said: "It was on my watch. Notwithstanding the fact that I commissioned this report, I stand before you and take the blame and will take the walk" -- and the package that goes with it.

The then chairman, Mr Farlinger, what did he say? This must have gone down well in places like Southampton and Port Elgin and Kincardine. Bill Farlinger, the acting president, the chairman who had been there for a couple of years, said, "Among the serious problems was the nuclear cult that seemed to infect the place." Mrs Fisher must have had an interesting Saturday morning breakfast at Kincardine when she met all those cultists. But that came almost immediately from the chair and now acting president, Bill Farlinger, well known to the first minister.

Perhaps most extraordinary of all was what I read in the Ottawa Citizen a few days later. Not to be outdone, Maurice Strong, a former chair during the period of 1991 to 1993 or 1994, told the Ottawa Citizen, and I'll only quote from part of an extraordinary interview, "Nuclear information basic to the health of the company" -- meaning Ontario Hydro -- "was withheld in a move that borders on criminal behaviour."

You're a ratepayer in Chelmsford, you're a Scarborough parent, and you're reading the paper: a cult; criminal behaviour. You really have to ask yourself the question, who was running the joint? Bill Farlinger was there as chairman for two years. Strong was there for two or three years. Kupcis was there for many years. All of a sudden -- yes, Kupcis takes the walk, but nobody's much responsible for anything, and boy, do we get some pretty aggressive statements about criminal behaviour and cults.

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Well, I'm from Missouri. I'm a little bit sceptical, because I read in the public accounts and I read in the papers, thanks to the sunshine law, that the most highly paid public officials in the province are all at Ontario Hydro. But boy, nobody seems to have known what was going on and very few people beyond Kupcis seem to want to take any responsibility. As I've said here before, my information, which I consider unimpeachable, is that Kupcis got fired; he didn't resign.

I'm not going to take the time this afternoon to read from the Financial Post of the weekend of August 30-September 1, an opinion piece by none other than Hugh Segal, called "Ontario Hydro Didn't Have to Let Kupcis Fall on His Own Sword." Segal raises some very interesting points. He raises some very valid questions about what's really been going on at the corporation. I'll tell you, if you've got any ability to decipher a not very elaborate code, you might want to read that article and join the Missouri crowd, who wonder just who's on first and what's on second.

The minister smiles. I guess I'm being a little bit too irreverent this afternoon because, despite what some folks said earlier, we've been down this path before in one way or another. I've been around it more than most. I've stood in this assembly for the better part of 22 years defending Ontario Hydro's nuclear commitment, and I still defend it. It's a hell of a lot harder to defend it today than it was two months ago, but I'm not prepared to abandon nuclear power. Like Segal, I believe it will continue to be an important part of the energy mix, but clearly, mistakes were made.

As I said earlier, we have an obligation in the public interest, as hopefully a self-respecting Legislature, to answer a couple of questions: What went wrong at Ontario Hydro nuclear and how are we going to recommend fixing it? If anybody thinks we are going to seriously deal with that question and offer an interim report within two or three weeks, you are on a different planet than I am. There is a way I think one could honestly take those initial terms of reference in so far as time lines are concerned and imagine them to be a contempt of the Legislature. Nobody who wants to do a good job is going to be able to answer the questions, what went wrong and how are we going to fix it, in two weeks.

I want to say to the members who are going to join this committee for the first time that you're in for a very interesting, educational and stimulative experience. I know when I joined 20 years ago it took me several days just to understand what the corporation was, what it did and what that remarkable document, the Power Corporation Act, entailed. If you want to see a watertight monopoly, folks, you spend some time with the Power Corporation Act. You're going to have to spend some time and you're going to have to hope there's someone there to explain the nuance and to take you through the several layers.

We're generalists, and we ought not to imagine that we're going to use this committee as an excuse to micromanage the corporation. I'm not interested. There are lots of people at Hydro to do that.

As for the minister's observation, "We need an interim report because the board has a right to know what you're thinking," let me tell you, if the experience in the late 1970s is any guide, half the committee room will be populated with information folks from Ontario Hydro, notwithstanding the minister's scowl. There will be more folks around there watching that committee from Hydro than you can shake a stick at. So when the Toronto Sun has gas about perhaps the committee having some independent resources, I would say let people have gas because if we're going to do our job, we have to have some reasonable capacity to assess what it is they're doing.

As one of my friends who knows the business well tells me, part of the problem at the corporation has been -- I hate to say it with the minister -- the iron-ring disease. I think there's some truth to that. Good people, but it is such an engineering mentality that is shot through the entire corporation that there's a problem. But the point I want to make is that there is an important job to do and it's going to take time and it's going to take resources.

What made the committee successful in 1976 and later was not only, I say to the reverend member for High Park-Swansea, the able and dispassionate leadership of Don MacDonald in the chair, but people like Alan Schwartz and Jim Fisher, who were staff to the committee. They did excellent work and prepared committee members for the questions, the briefings and the cross-examination that such an exercise necessarily entails.

I want to say in her absence, Evelyn Gigantes, the former member for Ottawa East, the New Democrat -- now, Normie, smile and be charitable.

Interjections.

Mr Conway: I've got to tell you, Evelyn and I didn't agree on much, but she did incredibly good work on that committee, hard work, diligent work, that set a standard for the rest of us that we generally didn't meet. Floyd might remember what Mr Nixon said one day when he was asked about some aspect of detailed analysis and suggested to the inquiring journalist that he really talk to Evelyn since she knew more than anybody else or the committee as a whole. But seriously, she did very good work and she didn't have that reputation without an awful lot of effort.

I simply want to make the point this afternoon that we have got to have reasonable time and reasonable resources. Because the history of Ontario Hydro, I want to say again, has been this very powerful, unique corporation that was designed in the beginning to be a public corporation beyond the control of the politicians. That was basic to Beck's plan. Much of that legacy has endured, irrespective of whether it was Churley or Conway or Sterling in the minister's chair.

I agree with the previous speaker who said, "You know, we've all been involved," and we have been. I was a minister for five and a half years trying to run a fairly large department. I was up to my neck in troubles with my own department and when the problems of Ontario Hydro were presented to me, I didn't have as much energy and time as I would have liked or as I had as a private member in the opposition.

That's a reality and most of the Hydro managers in the last 85 years have operated knowing that. I don't mean to slight the sterling minister of the moment, but the fact of the matter is that one of the other interesting realities, not well understood until you're in government in this province, is that the minister responsible for Hydro is not the Minister of Energy. It's the Premier, it's the first minister. There's a well-established internal protocol developed over the decades to allow that to happen.

I think the current minister is too fresh in his duties, but my experience, I say both personal and academic on this subject, would lead me to conclude that over the century there have probably been only two ministers of energy who have really had an impact reining the beast in on the grounds of accountability. Those two people were Bob Macaulay in the late 1950s and early 1960s, and Darcy McKeogh in the mid-1970s -- very strong-willed, powerful senior ministers. I think if both of them were here today, and they're both alive, and certainly in Neil Freeman's book, The Politics of Power, just published last year by the U of T Press on the subject of Ontario Hydro and its relations with government, Darcy McKeogh would probably tell you that he lost much more than he won.

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One of the issues with which we are going to have to try to deal is, how do we make this crown corporation reasonably accountable to the Legislature, to the government? I repeat, I am not interested in running the corporation, but I am interested in helping set general policy directions and encouraging the responsible minister and the cabinet of the day to exact some accountability and responsibility for the course that has been decided in the public interest by government with some involvement by the Legislature.

The essential questions, it seems to me, in the first aspect of the reference that is launching this select committee today are: What went wrong at Ontario Hydro nuclear, and is the so-called recovery plan an appropriate response and remedy to the difficulty?

Let me just take a moment to summarize the Andognini report. I just want to remind everybody. The Hydro board apparently got this very explosive report on or about July 21 and within two weeks they had formulated a substantial, multibillion-dollar response. Wow, I say. Wow.

Interjection.

Mr Conway: Harry, I don't know whether the farmers of Rawdon township would decide on a multimillion-dollar or multibillion-dollar plan in a few weeks of summer activity, but that's what Hydro did. The corporation that stood before us just a few weeks ago and set aside its every protestation of the last three decades, announced the following: Overall, the entire nuclear power reactor system, at an operational level, was only minimally acceptable; on maintenance, the system was only minimally acceptable; on training, it was only minimally acceptable; on engineering, similarly so; on quality; on radiation protection; on chemistry; and on emergency preparedness they were below standard.

Talk about standing up in public and taking your pants down and exposing the warts of the ages. This is it. I don't mean to be indelicate, but the member for Algoma will know of what I speak. For people who've been around, this is an unbelievable confession and it comes from people who said, "It could never happen, it would never happen, trust us, believe me etc."

But there's more. Having done all of that, in this remarkable about-face they say, "But we have a plan, a multibillion-dollar plan," according to Farlinger, "all ready to go." In fact everything I see, and I read the Hydro materials fairly carefully, they are already now planning on that basis. I can't believe up in Muskoka or in the leafy greens of Rosedale that even the most redoubtable Conservatives and Reform-a-Tories aren't saying: "Hold on. What's wrong with this picture? Maybe, just maybe, somebody somewhere should take a second independent look."

That is my point. The committee must undertake independent evaluation of that plan. I know for a fact that senior officials in the Ministry of Finance and elsewhere in the economic departments of the Ontario government have a high level of concern about the efficacy of this plan. I was in Deep River on the weekend talking to a number of the scientific community that I represent and these people were absolutely stupefied by the drastic nature of the Farlinger recovery plan. To put it politely, my constituents in Deep River are incredulous, very dubious.

I say to the minister, I say to the House, if we're going to be serious and be taken seriously, we have to, in a timely and disciplined fashion, get some outside independent analysis of that recovery plan. That, I think, is the centrepiece of the work we have to do, and I can tell you that will not be done in the next 15 to 20 days.

I repeat, to the minister particularly, I am not interested in an endless belt that's going to be just an excuse to meet with wonderfully convivial people like the Reverend Shea and the even more convivial Dr Galt. I have better things to do with my time and the public money than to engage in some kind of sham or scam. I go into this with good faith, as I believe all members do, and I think we can and should be able to do good work, but I want to be clear about what my conditions are going in, and I don't think they're unreasonable.

I was happy to hear the minister say that he will at an early date release -- I'm anxious to see the white paper on electricity reform, because there is just no way any group of members, any group of citizens, could or would be able to evaluate the recovery plan without understanding the broader context into which the recovery plan will fit. I don't expect the minister's white paper, green paper, yellow paper, is going to detail every specific energy initiative, but I do expect to get some greater clarity from the minister and the Harris government on where it believes electricity policy reform will take us and will take the giant utility that is Ontario Hydro. That's a critical question.

Really, the second part of the reference is that: What is the future for Ontario Hydro? I think there is a consensus that has developed over the last number of years that certain aspects of change are already agreed to. The Hydro monopoly on generation, we have all agreed, is over; at least that's the way I read it. The New Democrats and the Liberals certainly encouraged non-utility generation. The fact of the matter is that we had some very, very sluggish economic circumstances in the late, late, late 1980s and throughout the early 1990s. It's true.

Hon Mr Villeneuve: Not the mid-late-late 1980s?

Mr Conway: The demand curve dropped sharply in 1989, and from 1989 through to at least 1993-94 it was a very sharp downward trend. It was not unlike other jurisdictions.

That's the problem with the energy business: You've got to plan for the intermediate and longer term. I sat in the cabinet. When I look back on it now, we certainly made mistakes, no doubt about it, but we were trying to make policy with a surging demand, a demand that was far greater than Dr Porter's royal commission suggested just seven or eight years before.

The New Democrats come to office and they are faced with a very different set of economic circumstances. The demand curve crashes. By 1992 or 1993, when Darlington came on stream, with Darlington we were at something like 40% to 50% overcapacity. That was as much a function of dropping demand as it was increasing generation.

My granddaddy was here. Boy, did the Liberals get themselves in a mess, a real mess, back in the 1930s. Some of the most outrageous behaviour on the Hydro question came from those Liberals in the 1930s. One of the greatest lawyers -- well, he was certainly a pretty distinguished lawyer -- Arthur Roebuck, who was here as justice minister and energy minister in the 1930s, believed that those power contracts the Tories negotiated with the Quebec gang were evil incarnate, that they were absolutely immoral and worse. He was going to cancel them at all costs, and he did. He got away with it for a relatively short period of time because the Depression had literally kicked the stuffing out of demand. But I'll tell you, did the Liberals ever have to suck it up a very few years later when the economy started to turn around again. And guess what? They had the moral high ground and they had very little electricity and there was a mad scramble. That's not unusual, particularly when you get gyrations in economic growth, and that's what we've had over the last 10 years.

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We're going to have to decide some questions about Ontario Hydro. My colleagues have said, my leader has said, that we can and ought to do much more in the area of conservation. We've all said that, and I hope we can do more than we've done in the past. Certainly Dalton McGuinty believes we can and should do that. I believe very strongly that the time has come for a totally different kind of regulatory framework at Ontario Hydro. For good or for ill, I have come to believe after a long time and many mistakes in this business that you're not going to change some of the Hydro behaviour under which we have all suffered and laboured in government unless and until you create a much more modern, meaningful and rigorous regulatory environment for the electricity sector in this province. I'm anxious to take some expert testimony on that subject.

I think there are other aspects of change in the electricity -- competition, we all agree, in generation, its day has come. I believe there can and should be a substantial rationalization on the retail and distribution. There the big fight, quite frankly, is going to be, in first instance at least, between the two aspects of public power: the local utilities and the provincial utility. We've seen down in the Niagara Peninsula in the Lincoln case just how difficult a battle that's going to be.

I think there are ingredients for change that we've all subscribed to. The Hydro monopoly in generation is over. I believe a rigorous new regulatory environment is called for. I think there has to be a streamlining in retail and distribution. I think there's a greater role for private sector energy services corporations. I think there has to be more competition in the sector generally. The community expects it, and I think there are benefits that will accrue to all of us with that.

Having said all that, I don't believe we can or should just dismember Ontario Hydro. One of the reasons that can't and won't happen is this IIPA. Ontario Hydro's current asset base is largely nuclear. Roughly 60% to 65% of its generation is nuclear. You heard me talking to the Minister of Finance about his public accounts: $29 billion worth of Hydro debt guaranteed by Her Majesty's Ontario government. Most of that guaranteed debt attaches to the nuclear assets.

Does anybody think seriously that after the release of this report we are going to privatize the nuclear power division of Ontario Hydro?

Mr Gilles Pouliot (Lake Nipigon): Who's going to buy it?

Mr Conway: I don't believe we are and I don't think we will. I live on the Quebec border and I'm always struck by the fact that there are people like the Macdonald commission who think we can just, you know, with the will of the wisp, sell off the Ottawa River hydroelectric assets. When we ask the question, "Has anybody asked Bernard Landry and Bouchard? These plants are all anchored in the province of Quebec. Has anybody bothered to talk to Quebec about this?" "No, that's just a mere trifle." Maybe it is, but I come back to the question I guess we were --

Interjection.

Mr Conway: There are profoundly important political questions in this energy debate.

Let me digress for a moment on another one. I never cease to be amazed at how many people engage in this hydroelectricity debate in Ontario assuming that we are geographically like a Connecticut tucked into the bottom of southern California. A surprising number of smart people don't seem to understand the self-evident reality that Ontario is a very large jurisdiction that is very vast, most of it quite empty, and all of it rather cold for four or five months of the year.

Those basic geographic and sociological realities have a very real impact on energy policy. If you're in southern England in the middle of winter and the power goes out, it's uncomfortable but you can probably get through the night. If the power goes out at Pickle Lake in the middle of January, I'm going to tell you, you have a very different kind of reality.

Mr Pouliot: Yes, but you eat well in Pickle Lake.

Mr Conway: I'm deadly serious about this. We've got over a million people in this province who get their electricity directly from the provincial utility. Most of these people, apart from the big industrial customers, live in rural and northern Ontario. I want to know, as somebody who represents one of the most rural parts of eastern Ontario, what the free marketeers have to say about delivering safe, affordable, reliable electricity to my constituents in Matawatchan, Madawaska, Calabogie and Camel Chute.

That's a very important question and, you know, I don't get very many answers about specific commitments. I'm sure there are answers, and I don't mean to be some kind of Neanderthal who does not want to admit to the existence or the possible application of those answers, but I want to make the point that, as we look at the future of Ontario Hydro, we are looking at some of the most central questions that face the economic and social life of this province.

It has been observed by some that because Ontario Hydro has grown so very large and has become so reliant on one technology, namely, nuclear, we can't take a strike, and because we can't take a strike we've got a management problem. That's something I think we ought to look at in the course of our deliberations.

All of which is to say that I think we have important work to do. I'm anxious to get at it expeditiously. I look to the Chair. I'm encouraged by the membership of the committee. We are going to be working at close quarters. I expect there will be some significant differences of opinion on certain issues.

I want to say in conclusion, however, that I go forward in good faith with good purpose, but at my advanced parliamentary years I have much better things to do with my time than to participate in some kind of legislative cover for some preordained scheme that may derive from the very people who helped create the problem and may aggravate the very problem that we're all trying to cure. I know the minister to be a man of goodwill and good faith. I look forward to going into this exercise with him and other colleagues to hopefully show the people of Ontario that the Legislature is up to discharging one of its classic responsibilities.

Mr Gerry Phillips (Scarborough-Agincourt): I'm pleased to join the debate on the establishment of this committee and to say I share my colleague's view that the membership on the committee looks very good. Our two members, Mr Conway and Mr Kwinter, are extremely good. Mr Laughren has a world of experience. I don't know the members from the Conservative Party as well obviously, because many of them are newer, but I do know Mr Shea and I think he'll do a fine job as the Chairman.

I just want to talk a little bit about some of the things that we'll be looking to come out of the study. The minister mentioned an interesting fact, that it's the largest capital corporation, I think you said, in Canada. Without any question, this is a huge business. I don't think there's a major financial institution in Canada that hasn't studied Ontario Hydro and the possible ways of parts of it being privatized, parts of it remaining in the public. We are dealing with something where there is a substantial amount of taxpayers' money at risk here, so I support my colleague who was mentioning the need for adequate resources for the committee. As I say, there have been literally dozens of huge studies done on the business potential of privatizing portions of Hydro. What we want, obviously, out of this committee is what is in the best interests of Ontario over the next 50 years.

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It struck me as an odd coincidence, actually, that for a period of time there were rumours that the Ontario government planned to privatize Hydro. Then the mood of the public was reflected in real concern about that. Any polling we have seen done that has been made public indicates that Ontarians have some concern about that. Clearly this latest revelation in the middle of August has shaken Ontario's faith in their Ontario Hydro and its ability to deliver electricity at a reasonable rate.

With that one single admission, as my colleague said, a startling and quite a confidence-shaking admission in the middle of August, Ontario is now up for looking at Ontario Hydro and electricity not from a completely clean piece of paper, but certainly looking at all the options. That's the first point I wanted to make, the importance of the committee and the recognition that we are dealing here with I guess the largest public utility in North America -- I think it is; the minister is shaking his head -- the largest utility in North America, public or private.

The legislative committee has its work cut out, and certainly I was pleased to hear the minister say that the dates in his statement today that he mentioned are targets or goals, but the government is prepared to be flexible on that.

The second thing I wanted to mention is the importance to the financial health of Ontario of Ontario Hydro. My colleague Mr Conway mentioned the auditor's report, and what the auditor points out -- and these actually are notes that the auditor put in the government of Ontario's financial statements, but there are also similar notes in Ontario Hydro's annual report. It says, "Of this $16 billion that may not be fully recoverable," they go on to say that there is an estimated $16 billion of "potentially stranded debt."

What I think the auditor is saying is that there's up to $16 billion; there's some significant amount of Ontario Hydro's debt that may be, to use the jargon of the accountants, stranded, which could mean that the Ontario taxpayers are on the hook for that, because Ontario Hydro's debt, over its history, I guess, has been guaranteed by the province of Ontario. As a matter of fact, Ontario Hydro pays the province a couple hundred million dollars a year for that. For the privilege of the Ontario public backstopping Ontario Hydro's debt, Ontario Hydro writes a cheque to the Ontario government, to the taxpayers of Ontario, for a couple hundred million dollars. That has been all well and good, because it doesn't look like it dramatically impacted our credit rating, and Ontario Hydro has paid that sum of money, a couple hundred million dollars a year, to the coffers of Ontario.

Now, though, we see there was a risk in that. The auditor is pointing out that up to $16 billion could be stranded debt. Certainly, it's quite possible that in the end some significant amount of Ontario Hydro's debt could end up on the Ontario government books. Who knows what it might be, because obviously part of the committee's work is looking at the recovery plan. If even half of that $16 billion ended up on the province's books, $8 billion, that annually would be a charge of somewhere around $700 million a year in interest payments that the taxpayers of Ontario would have to pick up.

That's the second reason why the committee's work is extremely important. If indeed a significant part of Ontario Hydro's debt, when everything clears and the recovery plan is fully in play and the future of Hydro unfolds, if the taxpayers are going to be on the hook for, as I say, even half that stranded debt, it has a significant impact on the cost to Ontario, because $800 million is a lot of money in annual interest payments.

It also has an impact on our credit rating. I don't think there's any doubt that Ontario's books are improving. All of us had been hoping that Ontario's credit rating would be upgraded at some time in the near future. We've had three downgrades over the last five or six years; we were looking for an upgrade. But the credit rating agencies have warned us that Ontario Hydro's predicament, because the province is guaranteeing, may very well slow down the credit rating improvement.

Why is that important? The interest rates you pay are determined on the basis of your creditworthiness. Companies and governments pay money to credit rating agencies to rate the creditworthiness of companies and governments so they can loan them money at a certain interest rate. That's the second important role this committee's going to play: Is there a risk to the taxpayers that a significant amount of Ontario's debt could end up on the books of Ontario and therefore the taxpayers are on the hook for it?

I also am pleased to hear the minister talking about the environmental impact of these moves. It was ironic to most Ontarians when the Governor of New York indicated his concern about Ontario polluting the state of New York. I think all of us in Ontario believe we are leaders in the environment; we see Ontario as playing a leadership role. We have always been the first to be critical of bordering US states that contribute to pollution in Ontario. Certainly there's been an ongoing battle between the province of Ontario and city of Detroit about an incinerator in Detroit that is polluting -- my colleague from Essex will know that -- parts of Ontario.

My point is that we found it ironic and I think a bit embarrassing and a bit of a confidence-shaker in our environment to hear the Governor of New York saying he has real concerns about the pollution impact of Ontario Hydro's recovery plan. I think all of us are aware of the overview of the plan to keep Ontario Hydro generating electricity during this period where a significant number of the nuclear generators are shut down. What's going to have to happen is the fossil fuel generating stations are going to be cranked up, either reopened, several of them, or the ones that are open operating at a higher capacity, many of them I gather using coal, which is obviously much more of a pollutant than other forms of energy generation.

That's the third thing our caucus will be looking to the select committee to focus on: What is the short-term environmental impact of Ontario Hydro bridging itself from the current shutdown of the nuclear generators to the reopening, or whatever that plan is, and the environmental impact of the future generation?

We'll also be interested in some of the financial aspects of Hydro. One of the reasons we are into such an enormous amount of debt at Ontario Hydro is of course the Darlington nuclear plant. In that particular case, first there was an enormous cost overrun, as most of are familiar; second, it took substantially longer; and third, the way the accounting takes place for that is that none of the interest cost and none of the annual cost of construction were ever reported on the books until the day Darlington opened. It was like a licence to spend a lot of money without ever actually reporting it as an expense on the books until the day it opened.

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Of course, as we all know, if you take eight or nine years to build something that mammoth and you've got the compounding interest building up, plus all the compounding expense -- there was an enormous cost of Darlington, none of it ever reported as an expense till the day it opened.

I'll say as an aside that that's exactly the same accounting that's taking place on Highway 407 right now. None of that is being shown as an expense. The interest on all the expense is piling up until they begin operating the toll roads. We've got a mini mini Darlington in Highway 407. It's the same accounting. I have, in a different way, some of the same concerns about 407 and its economic viability because it's taking so long to begin the toll operation and so much of the expense is building up.

There's a fourth thing I want to say about the importance of the work of this committee. All of us have dealt with industry in our constituencies. We all know the importance they place on competitive energy costs. Historically, that's been an enormous advantage in Ontario, that we have had a competitive advantage on energy costs. My colleague Monte Kwinter knows far more about this than I do, but it has been a selling point historically for Ontario: Come to Ontario, a first-class workforce, a great environment to live in, close to huge markets, but also some energy advantages, initially because of our water power or hydro power. So the fourth area of concern for our caucus will be, what is this going to mean in terms of future energy costs and competitive advantage for Ontario?

It's extremely important, because some of our biggest industries are heavy, heavy users of power. Our auto sector, which is the engine that's driving the Ontario economy, no question about that, is a heavy user of power.

Mr Pouliot: Mining.

Mr Phillips: My colleague said mining, and that's exactly right. The Kidd Creek plant is perhaps the largest user of power in Ontario, perhaps in North America. For the economic engines driving our province, having a competitive advantage in some form on our power is extremely important.

The work of the committee can't be underestimated. I take my hat off to the members who are serving on it. As my friend Mr Conway said, he's not interested in simply filling in time. The interim report and the final report of this committee could very well reshape Ontario Hydro, as I said earlier, the largest utility in North America. There's a huge interest at stake here.

The committee will be getting expert advice from many different angles, much of it with a vested interest, a legitimate, honest vested interest. There are many who would believe that significant portions of this should be privatized and they will make a strong case for it, biased for their own interests, obviously, but a legitimate bias. The committee is going to have to sort its way through that. The future of our financial credit rating is at stake here, and the committee's going to have to work its way through that.

There's perhaps nothing that will have a bigger impact on the environment over the next two to three years than how Hydro is going to replace the power lost by the shutdown of the nuclear generators. Of course, finally, there's the issue of whether Ontario will be able to continue to say, "We've got a competitive advantage here on power, so expand your auto plant here, invest in some processing from our mines, because we can compete."

My colleague mentioned the array of options that will be put before the committee on generation, on transmission and on local services. Already most of us have been talked to by local utilities which have a view on how and who can best serve that, by many in the private sector who have a view on how and best that can be served.

To close, I appreciate the members who are sitting on the committee. I'll be looking forward to their work, and simply say good luck with it. To a very large extent, the future of Hydro is going to be very much shaped by the work of that committee.

The Acting Speaker: Further debate?

Mr Floyd Laughren (Nickel Belt): I want to engage in this debate for a short time as we move towards setting up a select committee on Ontario Hydro. As the minister is aware, I did not particularly like the idea of a legislative committee in the first place. I felt, given the enormity and the technical aspects of the problems at Ontario Hydro nuclear, that there should be an independent commission of inquiry. The minister and the government have obviously moved forward with the determination to proceed with the select committee of the Legislature. Given that, I understand that and I'm prepared to serve on the committee and to work hard at it. I don't intend to make a long speech today and I want to split the time with my colleagues.

I look forward to working on the committee. I believe the member for High Park-Swansea, Mr Shea, has the wherewithal to run a good committee and I very much look forward to working with him in that regard. I don't mean by that that he's not a partisan creature, any less than any of the other members of the committee, including the opposition. As I mentioned earlier this afternoon, I found it somewhat passing strange that the minister would refer to the non-partisan aspects of this committee, when if that really was predominant in his mind he would have appointed an independent commission. But I don't want to dwell on that.

For those students of Ontario history, of which I don't consider myself one but nevertheless have done some reading on it, one of the most fascinating aspects of our history is how often Ontario Hydro comes to the surface when historians write about the province. One of the ones I enjoyed the most was the biography of Mitch Hepburn. The member for Renfrew North mentioned Roebuck, the minister who was involved at that time, and some of the problems they got themselves into. Even since I became a member -- even though it's a long time ago, it's recent history -- there have been select committees looking at Ontario Hydro as well.

Ontario Hydro will always play a central role in this province, and I have no doubt in my mind whatsoever that one of the main underpinnings of Ontario's prosperity was begun by the electrification of the province. I don't think many people would argue with that. It's terribly important that we understand that and appreciate it and make sure we go forward so that that part of Hydro's role is allowed to continue.

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The terms of reference for this committee -- and I think some members need to be reminded of this -- are relatively narrow in that they deal with the nuclear part of Ontario Hydro. Where that gets a little bit fuzzy, it seems to me -- by the way, the title is the select committee on Ontario Hydro nuclear affairs. You could say, when you look at the terms of reference, that means the committee can deal only with the nuclear component of Ontario Hydro. However, when you start looking at the recovery plans of Ontario Hydro, then you have to expand beyond the narrow nuclear definition that's in the title of the select committee. I don't know how we're going to avoid that. I simply don't know how we're going to avoid it.

If there's going to be an appropriate analysis of the recovery plan, which is hugely expensive -- we're talking now $6.5 billion to $8.8 billion as part of the recovery to get the thing back in good working order. That's a huge amount of money, and in case there was a recommendation to decommission one or more of the plants, that doesn't include those dollars. They are gigantic on top of that. So if those numbers are accurate, $8.8 billion wouldn't reflect the total cost if there's any decommissioning.

The other thing is, even though those folks are engineers, I don't know how they came to those numbers as quickly as they did when they received the report that said there were problems there. I know the minister is an engineer --

Mr Conway: And a lawyer.

Mr Laughren: -- and a lawyer, and I guess that makes him a nuclear physicist, I'm not sure, or maybe just a rocket scientist. I'm not sure what it makes him, but thank goodness he's there with some technical expertise.

As I look at this, I think to myself, it's appropriate that somebody at least looks at the nuclear division and the recovery plan, because as has been said before, the people who have devised the recovery plan are the people who got us to where we are now -- the same people. Maybe some of the faces change as time goes on, but basically those are the folks who got us here, and it's not appropriate that we just simply accept what they say. That's just simply not good enough.

I can recall when the nuclear programs were being developed and all sorts of people were very critical and opposed to the nuclear option, they were treated as Luddites in our society. "Oh, no, this is something we must do. We must proceed with nuclear. After all," they said, "we're going to have this great Darlington facility and it's only going to cost $4 billion." Four billion, that's what they said, and now at the end of the day of course it's in the neighbourhood of $14 billion -- slightly more. But let's not blame the Tories, because as the minister says, this is a non-partisan issue, so I will certainly not do that. Of course, we know that the Liberals decided to continue with the completion of Darlington when they were in office. So it does go on, but I don't want to get into that.

I want to re-emphasize, though, what the member for Renfrew North said about how serious this problem is. When I was reading the IIPA report, it really is remarkable when you look at the assessment of their nuclear division. I'll give you a definition of what "minimally acceptable" means. It means "performance is substantially below industry standards but produces minimally acceptable results, and immediate management attention is required to improve performance." And "every aspect of the nuclear division is minimally acceptable except emergency preparedness, which is below standard." That's cold comfort.

We're not dealing here with just simply a nice, warm and fuzzy review of a major public utility. We're dealing with major problems in the nuclear division and we've simply got to get to them. That's why I'm sure the Chair, Mr Shea, will have the support of the opposition members of the committee to make sure that there's appropriate expertise that the committee is able to employ during this short period of time during which we're examining these problems, because the members of the committee are not experts on any aspect of Hydro, as far as I know. I don't know any of them who are an expert on it. Believe me, we're going to need help if we're going to get to the bottom of the problems and, second, to say where we go from here.

Who's to say that what Hydro says is the recovery plan is the appropriate one? Is it environmentally sound? Is it economically sound? I can tell you, for me, the jury is still out. I'm not prejudging it, because, as I say, I don't have the expertise in that regard and I don't think other members of the committee do. But we sure have to get some answers because it would be irresponsible for the committee to accept that report unless we were sure those were the best alternatives. Anything else would be irresponsible. So we do have to look at the alternatives.

That's why it's so terribly important that the minister's white paper is put before the committee at the earliest opportunity, because for us to be talking about a recovery plan that includes some other aspects of power generation besides nuclear -- if for example, and I really am speaking hypothetically here, the committee decided it was appropriate to close down a reactor and to perhaps even decommission it -- I'm not prejudging, because I don't know that -- if that was the case, where do we go from there, because the day of surplus energy at Hydro is over. Those of us in this party have always said that we were not prepared to open up the generation of power into the Hydro grid as long as there was a surplus of power there already. It made no sense. But now that's gone. Those days are gone, and I suspect they're gone for the foreseeable future, anyway.

We know that as we go down the road, there's going to be enormous pressure, and I think appropriately so, for competition to start feeding into the Ontario Hydro grid in the form of co-gens and so forth. I think that's inevitable. I personally don't have a problem with that because the surplus is no longer there. There's going to be a big fight between the Municipal Electric Association and Ontario Hydro and the Ontario government. It's going to be a blood sport and I'm glad I'm around to see that.

I did want to comment a little on the report. I was truly perplexed by the comments in the report about labour and labour relations. They didn't consult labour when they did the report, apparently -- that's what the labour people tell me -- and yet they come in here and they blame labour for management not doing its job. I find it hard to accept that coming from management types, from management people. If they can't do the job, get out. Somebody else will get in there and do the job of management properly. But to blame the fact that they couldn't manage on the fact that labour couldn't be controlled is ludicrous -- completely ludicrous. I can't imagine why they would have put that in the report.

I was going to give you an example just to show you how silly I think they are. Under labour relations it says, "Certain provisions of the union contracts" -- who negotiated those contracts? The labour movement didn't negotiate them with themselves, they negotiated them with Hydro management -- "limit the effectiveness of management."

I want to tell you, if I was management, I'd be ashamed to say that or admit that.

"Major issues include the following:

"Collective agreement restraints." You didn't have to agree to them. "Purchased services agreement restrictions; strike threat." If there's a strike threat, what does that mean? They have the right to strike. If you think they shouldn't have it, then you have the power to take it away from them. I don't understand this.

"Fitness for duty." If it isn't the role of management to make sure that people in these kinds of sensitive jobs are fit for duty, whose responsibility is it? Well the people themselves, of course, but at the end of the day it's their responsibility.

"Personnel and vehicular searches; too many union officials on full-time release." I want to tell you, in an operation that size, with half a dozen people out on release, I don't want to take the whole report apart but there's some real silliness there that I hope the committee doesn't get itself caught up in, because those are not the problems of Ontario Hydro.

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Mr Gilles Bisson (Cochrane South): Knowing this government, they probably will. "Strip the collective agreement; that will fix the problem," they'll say.

Interjections.

Mr Laughren: I'll wait.

Mr Steve Gilchrist (Scarborough East): Wait till the heckling from your own side stops.

Mr Laughren: That's right. I didn't want to say it, but you're right.

Mr Laughren: One of the problems on the whole issue of the government's white paper and the question of competition and privatization which is sort of hanging over the generation and distribution of power in this province like a cloud, it seems to me, is, what happens if you do decide to bring in competition and/or privatize, the whole issue of those stranded assets and the stranded debt?

If ever any government in this province decided they were going to put back on the taxpayers at large some of the debt that's related to Hydro, I think there would be and should be a ratepayers' revolt in Ontario. That is Ontario Hydro debt that should be paid for by the ratepayers of the province. I know you can say there's only one ratepayer, but there is a difference between people who use hydro and how much they use and people who use other sources of power, and that distinction should remain. I would be very unhappy if anybody ever tried to isolate the debt in order to privatize and have the taxpayers at large pick up the tab on the debt.

I simply will conclude by saying I will support the appointment of this select committee and I intend to work with it in a serious way. If I could just reinforce what the member for Renfrew North said, both of us come into this, I think, with the right approach to making it work. I have no doubt that we can. But if it ever appears that there's an attempt here to simply do a whitewash or to ignore pertinent data, I think both the member from Renfrew and I would be long gone and would not be part of that.

I take it seriously. I think there's an opportunity here to say some important things about the future of Hydro, and in particular about its recovery plan, because I for one could be convinced that what has been laid out by the Hydrocrats or nuclearcrats or whatever you want to call them is the right plan, but I really find that I'm going to need some convincing in that regard. If the experts we hire for the committee can help us in that regard, so much the better. My mind is not closed in that regard, but I think that a sceptical mind coming into an operation like this is a healthy one.

I look forward to working with the Chair, the members of the opposition and the other members of the committee. While I think the time lines are not terribly realistic, there's nothing wrong with keeping some pressure on the committee to get its work done. I understand that; I just wonder about how realistic it is. Nevertheless, we will undertake our task with enthusiasm, and I hope very much that at the end of the day the people of the province will say that we did a service and that Ontario Hydro will be a better institution as a result of it.

The Acting Speaker (Mr Bruce Crozier): Further debate?

Mr Pouliot: In a broadly summarized form, I shall be brief indeed. Why is it that whenever I as a citizen read about or listen to Ontario Hydro, the largest agency in Ontario, I have from time to time the very vivid impression that I'm listening to government, I'm reading about government, a form of government, maybe the second-largest government in the province? It's an entity.

By all accounts, people are cautioning that over the years Ontario Hydro exceeded its broad mandate, a mandate which is to provide electricity at a reasonable cost, and reliable electricity so we don't have to fear any brownout or any blackout, that there will be sufficient electricity.

Ontario Hydro under the act also has the power to charge for that electricity, so there's one hand that spends and builds facilities, provides power, and the other hand that charges consumers, residential, commercial and industrial consumers. Any residual money, any money left over, is put into a pool. It doesn't go back to the province, and yet when we look at the debt structure we see that Ontario Hydro, as of March 31, 1997 -- this year -- had a debt exceeding $29 billion, which is roughly the same amount of money they owed a year before: in 1996, $29 billion, and in 1997, $29 billion. This is the amount of money which is guaranteed by the province. Do you get me now, Mr Speaker, when we say, "Are they or are they not a government?"

They seem to be a government when it serves their purpose. For instance, they ask the province of Ontario to guarantee the money they have to borrow, yet they forget about their association with the government when it's time to run the affairs of electricity. If you ask can they or can they not have it both ways, Ontario Hydro, by way of cartel and monopoly, has done exactly that and has done it very well -- very badly if you happen to be a consumer, a citizen of Ontario.

Are you aware that the effective interest rate, the weighted average -- because they're on the hook long-term; there's no getting out of this -- in 1997 is 11.47%? That's in Canadian dollars for the Canadian market, people who buy those coupons, those debentures; and because their debt is structured long-term, not like a guaranteed investment certificate, when you get to the United States of America, because there are only so many people who can afford to buy so many of the $29 billion, it's raised to 12.78%. Does that make any sense in this day and age?

One of the worst-kept secrets is that Ontario Hydro owes $29 billion. That's only the amount of money that is guaranteed by the province. On top of it, I see the debt payable to the Canada pension plan investment fund. You know the CPP, when you check your pay stub? Ontario Hydro is in there with both hands to the tune of almost $2.7 billion. When we looked at the debt structure, because this is a mess indeed, it seemed that a group of at first well-intentioned people, and afterwards very powerful people, has given this fiefdom a halo of sanctity whereby it became impossible for anyone to question or penetrate this society of high priests. It became a closed circle. You saw some of them in the corridor.

Unless you are a physicist, you have no business telling them. You have experienced or read about brownouts. Remember New York state? And then the engineers, for they love to build things, came calling on behalf of Ontario Hydro and said, "Government of the day, better to be 15% over capacity than 0.5% short, and we the engineers, with public money, if you leave us alone, shall build things." Today, as our House leader would say, build they did. Half the debt is the tragedy, the fracas of Darlington. We all should share the blame. But now some grey eminences, some wise people come about and say: "Maybe it's time to do something with Hydro. Maybe we can privatize. Maybe we should have a mix of state and commercial entities."

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The Advisory Committee on Competition in Ontario's Electricity System, the Macdonald commission, has estimated -- and this comes from the government; we don't invent these things -- accurately they say, that a $15-billion reduction in Hydro's existing debt would be required to restructure Hydro along more commercial lines. Simply put, if you're to go private, reduce your debt by $15 billion.

My House leader, Mr Wildman, tells me, "Gilles, don't forget to mention that there's another $10 billion coming down the pipe." This $10 billion will have to hit the marketplace in three and a half to four and a half years. It will be competing with other issues. But the minister, who's an engineer, a well-intentioned, pleasant fellow --

Mr Wildman: And a lawyer.

Mr Pouliot: -- and a lawyer to boot, says: "It's guaranteed by the province of Ontario. The bond-rating agencies are telling us that it won't impact on our rating." But the marketplace -- he doesn't say this; he's so absorbed -- may react differently. What if the issue is badly received? Because it competes with New York state, it competes with the international market. The value of our currency will be a determining factor. No one will say that this issue of $10 billion will cost you less. The marketplace says to expect at least 12 basis points under ideal conditions. So this will take on extraordinary proportions.

The province's risk to make payments under the guarantee has therefore increased. That's what they're saying: "We're on the hook." It becomes a little tedious now, a little more difficult. People should be getting nervous. Hydro has stated that this does not pose a risk for holders of its bonds and notes. In other words: "If you have a coupon, don't worry if it says `Ontario Hydro.' It's fully guaranteed by the broad shoulders of the province of Ontario. Don't worry. If we can't pay Ontario Hydro, the taxpayers will be left holding the bag, and they will fork over. They will pay the debentures."

You saw the interest rates; you saw the costs. They're completely independent of the books of the province. Yet we are fully responsible to pay not only the provincial debt, which is more than $100 billion, accumulated over many, many years and governments, but on top of it comes the $29-billion Canada pension plan -- which is all of us; we have to pay it back -- so we're up to $32 billion; and on top of it, another $10 billion.

How did we get there? This is scary. I know you to have a family, Speaker. The sons and daughters of every Ontarian will be asked to carry this mismanagement for generations to come. Some will say that, given the massive debt, it does not auger well. It stops them from going to the marketplace. How would you like to buy in, as an entrepreneur, yet face the liability that comes with it?

The sister provinces of Manitoba and Quebec must be salivating. I know in the case of Quebec that their power is 100% generation, 100% hydro, for as long as the river flows, and they're overcapacitated. Yet the government of Ontario does not see, with its false pride, an opportunity to strike a long-term deal or at least a medium-term deal to ensure that we can make a pause, get to the bottom of this. Have the right expertise join members of the committee so people will not be dazzled and mesmerized and then come up after. Give it the time that it deserves so that never again will we be subjected to this kind of uncertainty, to this kind of mismanagement that is finally emerging.

It took a catastrophe to wake people up. People knew there was a malaise that was entrenched at Ontario Hydro, but in order to start looking at a shake-out and say collectively: "Look, a lot needs to be done. We have to go to the very bottom. We have to be innovative once we formulate our solution and our alternatives." Well, sure enough, the good people that we are, we did not hear the many, many alarm bells. We shut the clock off and slept another 10 years and then another 10 years again. This did not happen overnight. This is the result, the culmination of years and years of secrecy, of well-intended yet ill-fated practices at Ontario Hydro. What do we do? We grab the clock. Some at Ontario Hydro will point a finger and blame communication, the lack of this, the lack of that, the state of denial.

I want to wish the committee very well and let me, please, ask the minister to ensure, given the magnitude of the problem, given the importance of electricity, that the committee has the resources to do a job that they wish to do and that needs to be done.

Mr Wildman: I want to participate in this debate regarding the government motion as a member of the assembly who has had some considerable time dealing with Ontario Hydro's problems and challenges, and to say that I am prepared as a member of the assembly to accept the government's position that there should be a select committee formed. But I do regret very much that the government has not accepted our advice that an independent commission be established to look into Ontario Hydro: how we got to where we are, particularly vis-à-vis Ontario Hydro nuclear, and where we should go from here.

I've served in this place since 1975 on both sides of the House and I have seen this movie before. The fact is that we've had two select committees in the past. My colleague the former member for York South, who at the time was the dean of the assembly, Donald MacDonald -- not the Liberal Donald Macdonald that this government appointed to look into Ontario Hydro -- the former member for York South chaired the select committee, and that committee, all of the members from all three parties, worked very, very hard to try to come to grips with the issues at Ontario Hydro and the future of Ontario Hydro. However, we were not able to adequately deal with those issues.

I can remember in 1975, when I first arrived in this august assembly, there were proposals to build another nuclear plant; as a matter of fact, proposals to build a series of nuclear plants around the Great Lakes. The initial proposal was for a plant that was to be called Darlington. The estimate at that time was for $4 billion to construct Darlington: $4 billion. It quickly escalated to $7 billion. Then, when it was finally completed under the Liberal government, it had cost $14 billion, which is about half of the total debt that is currently owed by Ontario Hydro for one plant that by the time it was built was not needed. I was not a clairvoyant back in 1975, and I wasn't the only person who was saying, "We don't need this plant."

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There were all sorts of arguments about the environmental aspects, and they are important, but that wasn't the issue that I was raising and that others were raising, particularly back in 1975 when the then Conservative government of Bill Davis was proposing to build this plant. It was the fact that economically it didn't make sense. It has never made sense. It certainly didn't make sense when we finally saw the final figure on the cost of the construction of Darlington.

Yet when we came into government in 1990, the engineers over at Hydro not only had just completed the construction of Darlington, they were proposing to build 17 or 18 more plants at a time when we had a surplus of power. I could say perhaps that there were many people who argued about Darlington on the basis of whether the electricity was going to be needed, but it was obvious by the late 1980s, 1989, that we did indeed have a surplus of power and that the Darlington plant coming on stream was going to exacerbate that situation. Yet they wanted to build 18 more plants because they said: "You can't be sure. We might need it."

My friend from Renfrew North referred to it as the iron-ring disease, and I honestly believe that there were an awful lot of construction engineers at Ontario Hydro who had nothing better to do than design more plants. Unfortunately we had wrong staff, and our government may have contributed to that wrong staff in that we cut the staff of Ontario Hydro by one third on our watch and we froze the rates, because the rates were escalating significantly, largely due to the debt of Darlington coming on.

Mr Conway: They got frozen after a 44% increase, as I recall.

Mr Wildman: Exactly. There was an enormous escalation and we froze them because we were being told by the major power consumers in the province that, if this continued, Ontario would not be competitive in the North American economy. So we froze Ontario Hydro rates and we cut the staff. There was an argument about whether we had proper staff: Did we have maintenance and operating engineers as opposed to construction and design people? There were an awful lot of construction engineers over there twiddling their thumbs and very angry about what was happening, and saying, "These people don't know what they're doing."

All of this was debated in the former select committees. That's why we believe we should have an independent commission. The former select committees under the previous governments were chaired by an opposition member. This government has chosen -- and I have a great deal of respect for the member for High Park-Swansea, my dear Mr Shea, and I do mean that. I'm not being sarcastic when I say that. I have respect for him but I am worried that this may become a committee dominated by the government side, which was not the case of the previous select committee. It was a very independent investigation of Ontario Hydro, but not independent enough in my view, and I don't think that this committee will be as independent as those. But I'll wait to see. We have some very competent members going to serve on that committee, and I hope they do well.

I'm very worried because of this government's propensity to attack the public sector.

Mr Conway: Bud, I think I heard a beeper. Isabel, you've been bad.

Ms Isabel Bassett (St Andrew-St Patrick): I've been trying to turn it off.

Mr Wildman: You're not supposed to bring it in here.

This government says they don't like the public sector, that they don't like anything that is carried out by the public sector. They have the view that anything that is done by government is inherently inefficient and inherently bad, and conversely, anything that is done in the private sector is efficient and profitable and is the best way to go. With that kind of ideology, I hope we haven't already predetermined the results of this committee's considerations.

Since the government has chosen to ignore our proposal for an independent commission, I hope this committee will consider a number of things, because this is a very important work that the committee is about to commence. The fate of Ontario Hydro is critical, as all of us know, for the economy of this province. It's critical for jobs and it's critical for public safety in our province when one considers where a number of these nuclear plants are located and how close they are to population centres in southern Ontario.

We have the question of the debt and we have the enormous investment that has been made since Sir Adam Beck by the people of Ontario in this institution of Ontario Hydro and in the capital assets of that company. We have to ensure that Ontario has access to clean, affordable and reliable electricity if we're going to be a competitive marketplace. That's why we think there is so much public interest at stake that we shouldn't be following the route simply of a select committee. But if that's the way the government intends to do it, it's imperative that the committee know that all the issues related to nuclear safety and environmental protection are properly addressed, as well as the issues around costs and debt and assets that must be dealt with.

The committee must be able to investigate the economic, environmental and safety issues that led Ontario Hydro in August to decide to lay up seven reactors and embark on this multimillion-dollar restructuring plan. The committee has to be able to have the staff and the research capability to properly examine Hydro's multimillion-dollar recovery plan to determine whether it is economical, whether it is the most environmentally friendly, whether it is safe and whether it will ensure a reliable power supply or whatever other alternatives might be used within the framework of public power.

This is an enormous challenge for the members of the committee. The committee must have research staff. I believe it must have legal staff. It must have the right to subpoena witnesses and documents. It must have the right to cross-examine witnesses under oath. It must have a budget which will make it possible for those things to be done. It has to have adequate staff to review the existing literature and brief the members of the committee, to interrogate witnesses and to do research. That's going to take time as well as money, and that's why I am very concerned about the time frame that is being proposed by the government for this committee. The suggestion that the committee will produce an interim report in 17 days I believe is bizarre. It's imperative that this committee not be forced into making hasty conclusions; it must have a reasonable time frame.

The first stage of the committee's work must deal with the events that led up to the unveiling of Ontario Hydro's recovery plan which was announced last month. The committee must hold hearings, and we think it will probably take at least until the end of the year for adequate work to be done, with an interim report early in the new year.

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The second stage of the committee's work will have to be the examination of the government's white paper. The committee will have to hold hearings which should finish I guess halfway through the year. I know the Chair of the committee should be very concerned about the time frame that is being proposed, as well as other members of the committee. I believe it's important that this work be done in the context of Ontario Hydro not making long-term commitments for replacement power, capital replacement or new generating facilities until the committee has reported.

The central issue for the committee's work must be the proposed recovery plan. Initially, Mr Farlinger said that the recovery plan would cost about $6.5 billion to $8.8 billion. Within a couple of weeks, that figure had escalated by $1.5 billion. I hate to sound cynical, but whenever I'm dealing with Hydro, I say, "What else is new?" when you start getting these big numbers. Everything with Ontario Hydro is a mega-project.

On top of these costs there is an estimated cost of $3 billion for decommissioning if a decision is made to actually leave one of the plants closed, or more than one. Nobody really knows what the cost of decommissioning is, but their estimate is around $3 billion. We all know, as consumers of electricity in the province, that we're all going to pay one way or the other. If the government maintains its position that electricity rates should not escalate, then that means they are simply going to be delaying paying down the Hydro debt. If the length of time it's going to take to pay down the debt is longer, then obviously ratepayers are going to be paying more interest. We're all going to pay one way or the other.

The legislative committee is going to have to do independent research into these issues: questions around retooling of the nuclear plants. Is this the best or most cost-efficient solution? Will we be throwing good money after bad? How much will it take to restore the plants to a good, reliable state? What about environmental issues? How clean can fossil plants be made? What are the alternatives in terms of purchasing power from outside the province or avoiding future capital costs through conservation and the use of non-utility generation, whether in a regime of competition or otherwise?

What about the impact on jobs in communities that are dependent on these plants? What about the impact on jobs in the private sector, in plants, industries, businesses that are dependent on good, cheap, reliable power? Will the cost of retooling nuclear plants keep jobs in the province that would otherwise have gone elsewhere? There are all questions the committee will have to address and they are not going to be easily answered.

I have a major question which I believe the committee must deal with: How is it that only a couple of weeks prior to the president of Ontario Hydro and the board making public this damning report on Ontario Hydro nuclear, Mr Andognini, the author of that report, was appearing before the federal regulator, the AECB, arguing for a five-year renewal of their licence? If things were as bad as his report indicated, how is it that he could argue before the federal regulator only a couple of weeks later that they should have a renewal of their licence for five years?

I suspect there were political decisions made in between those two events, political decisions where it was decided that there needed to be a damning report made on Ontario Hydro, that the credibility of Ontario Hydro, which has been damaged for good reason, should be damaged even further so that this government could carry forward on its privatization agenda.

I think these are questions that must be answered. That's why we need to have a good time line, that's why we need to answer these questions and that's why we need the white paper.

Mr Wayne Wettlaufer (Kitchener): Come on, 17 days is more than enough to do that.

Mr Wildman: This guy has no idea of how complex these questions are. Here are some questions that have to be --

Mr Wettlaufer: I come from a business environment where we didn't need that much time.

The Acting Speaker: Order.

Mr Wildman: Is it possible to refurbish the Pickering and Bruce nuclear plants and retain their workforces so that they run reliably? You're not going to answer those questions in a real short time.

The Andognini report's brief section on hardware and design states, "Plant hardware, including equipment and materials, for the most part is adequately reliable." Is that a reliable statement? AECB thinks it is.

How do we get to where we are now? How is it that previous governments let the cost of Darlington grow from $4 billion to $14 billion? How has the projected performance of Hydro's nuclear stations compared with actual performance? What evidence has Hydro provided to the Atomic Energy Control Board to support the renewal of its nuclear licences, and was this evidence consistent with the findings of the Andognini task force, considering that Mr Andognini was the one who made the argument to the AECB? These are not simple questions and they're going to take a good deal of time and expertise to answer, expertise that the individual members of the committee obviously don't have and couldn't have.

What are the costs and technical difficulties of decommissioning? What are the costs and technical difficulties of dealing with nuclear waste disposal? These are issues that have been hanging over Ontario Hydro for the last 20 or 30 years and have not yet been answered.

What are the economic consequences going to be if the government, with its white paper, in response to the Macdonald report, advocates not only open competition but a big dose of privatization? If it deals with privatization, will the $2 billion being spent on human resources wind up being stranded investment if the plants become uncompetitive?

Hydro proposes to spend, as we said, up to $8.8 billion or perhaps $10 billion on its so-called nuclear asset optimization plan. There needs to be a thorough examination of the economics of this approach as opposed to the alternatives.

Here are very difficult questions: Hydro expresses optimism about returning the Bruce A and Pickering A to service. Hydro needs to share its assumptions with the cost of power from these two stations compared to alternative sources under a regime of competition. I think this is significant because the cost of the recovery plan has escalated substantially, perhaps to $10 billion, and one of the reasons for that, the minister has said, is changes in assumptions in only a couple of weeks -- $1.5 billion in escalated cost in only a couple of weeks.

What is the best way of ensuring that competition brings environmental benefits? How much stranded debt will there be and how will stranded assets charges work in practice? What measures can be taken to ensure that any benefits of competition in the form of lower prices are shared equally among consumers, that is, residential consumers as well as industrial and commercial consumers, no matter where they are in the province, north, rural, as well as urban? This is of significant importance to residents of northern Ontario. It's of significant importance to the farmers of this province, particularly dairy farmers and people who use a lot of electricity. They already pay, in rural and northern Ontario, 15% more than their urban friends. If competition lowers rates for some, it must lower rates for all. Will competition provide opportunities for Ontario entrepreneurs and communities, or will it mainly mean more business for American multinational utilities?

The Acting Speaker: It being 6 of the clock, this House will stand adjourned until 6:30 tonight.

The House adjourned at 1800.

Evening sitting reported in volume B.