Assemblée législative de l'Ontario

MINISTRY OF NORTHERN DEVELOPMENT AND MINES

CONTENTS

Tuesday 19 November 1991

Ministry of Northern Development and Mines

STANDING COMMITTEE ON ESTIMATES

Chair: Jackson, Cameron (Burlington South PC)

Acting Chair: Johnson, Paul R. (Prince Edward-Lennox-South Hastings NDP)

Vice-Chair: Marland, Margaret (Mississauga South PC)

Carr, Gary (Oakville South PC)

Daigeler, Hans (Nepean L)

Lessard, Wayne (Windsor-Walkerville NDP)

McGuinty, Dalton (Ottawa South L)

McLeod, Lyn (Fort William L)

O'Connor, Larry (Durham-York NDP)

Perruzza, Anthony (Downsview NDP)

Wilson, Gary (Kingston and The Islands NDP)

Substitutions:

Brown, Michael A. (Algoma-Manitoulin L) for Mrs McLeod

Cunningham, Dianne (London North PC) Mrs Marland

Ward, Brad (Brandford NDP) for Mr Perruzza

Wood, Len (Cochrane North NDP) for Mr O'Connor

Clerk: Carrozza, Franco

The committee met at 1540 in committee room 2.

MINISTRY OF NORTHERN DEVELOPMENT AND MINES

The Chair: I would like to begin this meeting of the standing committee on estimates. Miss Martel.

Hon Miss Martel: I think members should have received a copy of the responses we have tabled with respect to the questions raised by Mr Brown in our last meeting. If any further information is required, we will also provide that, but I think we have done the best we could, given the time to respond in detail to each of them.

Mr Brown: Thank you. We appreciate that answer and certainly if there is something to pursue, we will pursue it in the allotted amount of time.

The Chair: When we were last together we agreed to recognize Mr Eves to proceed with his opening statement, up to one half-hour, and then the minister will follow with her response to both presentations. She will have up to 30 minutes as well. Mr Eves, please proceed.

Mr Eves: At the outset, I would like to thank members of the committee, the minister and my colleague Mr Brown in particular for accommodating me as I try to wear about four different hats on different days. I am pleased to be here today to express my views about the Ministry of Northern Development and Mines, its program management and cost-efficiency.

I would like to begin my remarks by thanking the minister for her efforts on behalf of my constituents to achieve greater access to the northern health travel grant program. As many of you may be aware, I have been a fairly active participant in the fight to secure the eligibility of all residents in Nipissing and Parry Sound districts to participate in the northern health travel grant program.

On June 9, 1988, the then Minister of Northern Development and the former Premier of the province announced that the government had redefined the boundaries of northern Ontario to include all of the province's 10 territorial districts. The districts of Parry Sound and Nipissing in their entirety would then be considered part of northern Ontario for the purpose of all government policy and program administration. As a result of this announcement, all residents of Parry Sound riding were supposed to receive the benefits afforded to northern Ontario residents, who so often suffer due to a lack of services, distance and support systems.

In spite of the fact that Parry Sound riding received full northern Ontario status as of April 1, 1989, the Ministry of Health did not acknowledge the eligibility of all residents, in fact probably the majority, about 75%, to receive assistance through the northern health travel grant program. Both the definition of northern Ontario for the purposes of this program and its distance requirements precluded some constituents in Parry Sound riding from participating in the program and I was unable to convince the former government of the inequity of these regulations.

As of July 1, 1991, the Minister of Health finally recognized the northern status of Parry Sound riding and changed the regulations to allow residents of Parry Sound riding to qualify for the northern health travel grant program. The minimum distance requirement for a grant was reduced for patients travelling both within northern Ontario and to Manitoba to 100 kilometres from 250 kilometres and for those seeking specialized medical care in southern Ontario to 200 kilometres from 300 kilometres. However, even further regulation now dictates that a general practitioner who refers a resident for specialized medical treatment must be a northern Ontario physician in order for the patient to qualify for the program.

As a result, some residents in the district of Parry Sound are still denied access to the grant. For example, a constituent living in the community of Sprucedale in the southern part of Parry Sound riding who would normally go to a doctor in Huntsville, the closest community, is presently not given access to the northern health travel grant program when required to travel to southern Ontario. I view this as being somewhat inconsistent with the commitment the Minister of Health has made, and I urge the Minister of Northern Development and Mines to lobby her colleagues at the cabinet table, especially the Minister of Health, to change this regulation, which is a deterrent to some of my constituents receiving proper specialized medical treatment.

I have mentioned this fact directly to the Minister of Health and she did indicate several weeks ago that she would look into the matter, but any assistance you are able to give me would be greatly appreciated. Northern Ontario is severely underserviced by medical practitioners. In fact, there is only one child psychologist and one speech pathologist and one neurologist in the entire area of northern Ontario. As of next week, there will only be one dermatologist in the Sudbury region, which is home to some 160,000 people.

The cap on billings for doctors will result in even further inequities in the health care delivery system in northern Ontario. When the recent agreement with respect to a cap on doctors' billings was signed between the Ontario Medical Association and the government, the OMA was of the understanding that any problems with this cap would be negotiated on an individual basis, and in fact paragraph 10 of the agreement so provides. As a result, special circumstances in northern Ontario, they were led to believe, would be taken into account.

However, it is at least the opinion of the Sudbury and district medical profession that the minister has unilaterally decided not to consider any threshold exemptions beyond physicians who are currently in the government's underserviced area program. There would be no exemptions for doctors in hard-to-service areas and no additions to the list of physicians registered with the underserviced area program. The minister should be well aware that not all doctors working in the north are covered under the underserviced area program and of those who are, they are only covered for a four-year period of time.

I am concerned that this decision is going to have some negative ramifications on the accessibility of health services in northern Ontario itself. I spent a great deal of time this morning speaking to physicians in northern Ontario who informed me that they are considering leaving northern Ontario as a result of the minister's decision and that they are worried for their patients who will not be able to access proper medical care in the north. I understand that the minister, along with the Treasurer, met with representatives of the Sudbury and District Medical Society last week. At this time it is my understanding that you were both informed that specialists were thinking of leaving northern Ontario as a result of the Minister of Health's decision.

They also discussed ramifications of this situation on the northern health travel grant program itself, because of course patients who now access specialized medical treatment in northern Ontario would be forced to travel to southern Ontario if their physicians went south before them. This would result in an increased cost to government under the northern health travel grant program. In fact, I received a call this morning from a patient of Dr Donahue's, who indicated that it is his understanding -- where he got this information I do not know -- that not only will some patients perhaps be required to travel to southern Ontario but the Ministry of Health is going to fund day clinics for Dr Donahue to return to Sudbury and North Bay on a daily basis. I find that rather illogical, to say the least. Why not just keep him where he is?

I think the government, if it proceeds with the Minister of Health's current decision, is not only not going to recognize and accommodate the needs of northern Ontario residents but this in fact could lead to increased expenditures on behalf of the government as well. In other words, we could have the worst of both worlds. The government has been ignoring the health care needs of northerners for some period of time -- and not just this government, I might add. The minister recently announced that Laurentian and Lakehead universities will receive a total of $2 million over the next two years to pinpoint ways to recruit and retain health professionals in the north.

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This is a far cry from the medical and pharmacy schools which the New Democratic Party, while in opposition, promised it would establish in northern Ontario. I do support this initiative; however, I think we need to start bringing health care professionals into the north now. Any time we wait to begin this process, be it two years or whatever, results in a lack of service to northern Ontario residents. I think it makes sense that we should encourage northerners to receive treatment at health facilities in the north.

We have an excellent cancer treatment centre in Sudbury, the Northeastern Ontario Cancer Clinic. Study after study has proven that health care is most successful when it is provided as close to home as possible. Why are we not encouraging patients from northern Ontario to seek treatment in Sudbury with respect to cancer rather than travel to other parts of the province where they are only isolated from their families and uncomfortable in unfamiliar surroundings?

I do not question for one moment this minister's commitment to northern Ontario. I find her to be a very caring and capable person who serves her constituency well. What I do question is the sensitivity of some ministers of the crown to the unique problems and needs of the north. I do not feel assured that the Minister of Northern Development and Mines truly has the ear of each and every one of her cabinet colleagues.

Over the past 14 months we have seen the government go from crisis to crisis without any overall economic strategy for growth and development in northern Ontario. They have reneged on several promises they made during the last election campaign and have no long-term plan for the renewal or revitalization of our economy in the north. I think we need some proactive solutions to the problems facing Ontario, especially in the forest and resources industries.

We have seen the government respond on an ad hoc basis to many eleventh-hour crises, usually after it is too late and usually at tremendous cost to the taxpayers. What we need to see from government, and what we have not seen as yet, is job training, retraining, private sector partnership, industrial restructuring and an investment strategy. We need a government which is proactive, not merely reactive.

The economy of northern Ontario is particularly vulnerable. There are several factors, including a lack of technology and lack of an efficient transportation system, which work against economic development in northern Ontario. With the growing concern about the protection and preservation of our environment, the resource-based industries have found it increasingly necessary to diversify and develop technology in order to respond to consumer demands. This diversification has been particularly difficult for northern Ontario, which is, by and large, composed of one-industry communities.

The government's record in northern Ontario and its continued misuse and neglect of the northern Ontario heritage fund speaks to its lack of commitment; at least I think you could come to that conclusion. Instead of using the fund to encourage businesses in northern Ontario, I believe it is basically being used to plug holes in dikes.

On November 4, the Minister of Northern Development and Mines participated in a joint federal-provincial announcement regarding the northern Ontario development agreement. This agreement will supposedly invest a total of $95 million in the northern Ontario economy and help renew the forestry, mining and tourism industries. I have had quite a difficult time trying to confirm information. Since the announcement, I have been trying to secure a breakdown of the monetary arrangement of the agreement. Neither the federal nor the provincial government seems to be able to provide me with this information. As a result, I wonder whether this is a truly co-ordinated effort and how much preparation has actually gone into the agreement.

Tourism, mining and forestry are all very important to northern Ontario, but I must point out that the agreement does not make a commitment to the transportation systems in northern Ontario. It says nothing of the four-laning of the Trans-Canada Highway through northern Ontario, which of course was promised during the last provincial election campaign. We do not see a commitment from either the federal or the provincial government. We will not see any great diversification of the economy of northern Ontario until the necessary transportation infrastructure is put into place.

I am very concerned that the agreement does not provide as well for northern Ontario as perhaps the 1985 agreement signed between the federal government and a former government promised. In fact, it would appear that Ontario will receive $18 million a year less for forest resource development under this agreement than it did under the previous agreement signed in 1985, despite the fact that we are now some six years later.

The mandate of the Ministry of Northern Development and Mines is quite clear. It was established initially, and I believe still exists, to promote, advocate and support the economic and social wellbeing of northern Ontario residents and to generate new wealth and benefits for the residents of northern Ontario by stimulating environmentally and economically sustainable use of the province's geology and mineral resources. This ministry should achieve these goals through the promotion of northern community and regional economic development diversification and adjustment. It should also plan and co-ordinate an integrated multimodel transportation system, improve access to quality social and health services and provide cultural opportunities.

Many of you here today are very familiar with these goals, as I have been quoting them directly from a ministry publication. Over the last few years the Ministry of Northern Development has also directed its efforts towards diversification of the northern Ontario economy and educational problems facing the residents of the north.

I found it interesting before I came here today, as a matter of fact a few days ago, to read some of the minister's recent comments about the northern Ontario heritage fund and its successful promotion of economic development and diversification in northern Ontario. The minister, in a press release issued on April 25, 1991, applauded the northern Ontario heritage fund's commitment for this year, $54.8 million, and a total of $92.7 million committed to northern Ontario through the fund since its inception in September 1988.

I might say the minister would appear to have changed her mind in this regard. I recall when the member for Sudbury East was first elected to the Legislature. She arrived here, as many of us do, with many new and great ideas for the development of Ontario's north. In fact, she introduced a private member's resolution on April 14, 1988, condemning the government of the day:

"...for its inability to establish the northern Ontario heritage fund as outlined in the budget of May 20, 1987, and in the speech from the throne of November 3, 1987; therefore this Legislature strongly urges the government to: immediately establish the northern Ontario heritage fund; ensure that northerners, through committees representing northern communities, labour, native groups, women's groups and local small businesses, control the disbursement of the fund; and provide substantial funding to help ensure long-term economic growth and diversification of the region."

The minister went on to state that in her eyes this resolution did not go far enough to express her outrage with the government's lack of commitment to northern Ontario but that she had toned down her resolution so she would not be ruled out of order by the Speaker. The member for Sudbury East went on to say that northerners had a right to this fund because they did not see a high return of their taxes. The money is collected in the government's Treasury in Toronto and for the most part stays in southern Ontario.

The member for Sudbury East rightly stated that this fund is not viewed as charity in northern Ontario, which faces particular structural and social problems of which many residents of southern Ontario are unaware. There is a definite need for leadership and co-operation in northern Ontario and the fund is required to ensure that economic development in the north is attainable.

During the debate on her private member's resolution, the member for Sudbury East asked why the government was stalling on the establishment of the fund. "After all," she stated, "the budget commitment was not excessive. It was a mere $30 million; inadequate at best."

She called for a government commitment of at least $500 million over three years to put in place an adequate fund that would continue over the long term. The New Democratic Party supported this request. At least they appeared to before they became the government. They believed at the time that ongoing funding would be secured in part from resource companies, particularly from stumpage fees and mining profits tax.

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Some of you here today will be aware that I rose in support of the private member's statement on that day and I was pleased to have the opportunity. I believe the former government's commitment to northern Ontario was tenuous at best.

The member for Sudbury East was steadfast in her fight for the establishment of this fund. In an open letter to the former Minister of Northern Development, dated April 5, 1989, she stated:

"Northerners were mislead into believing the fund would be a vehicle to return to working people and communities in the north some of the wealth they have produced for resource companies, especially in times of need."

Unfortunately, I am here today trying to make the current government aware that I am becoming almost as cynical of its commitment to northern Ontario. I supported the member in her efforts to obtain moneys for a northern Ontario heritage fund. The problem seems to be that the minister has forgotten her resolution and the size she thought would be appropriate for the fund some years ago.

During the last election campaign, Premier Rae promised to establish a multimillion-dollar fund to protect resource-dependent northern Ontario from the ravages of boom-and-bust cycles. He announced that he would start a heritage fund equal to what the provincial government collects in mining and forestry fees to build industrial parks, to improve local schools and colleges and to shore up social services. Mr Rae also promised that he would direct $400 million over the first two years of his government, one of which has already expired, to this fund. Well, Premier Bob, you have 10 months left.

As I have stated before, we have watched the government stumble from crisis to crisis during the past year in its dealings with northern Ontario. The government's handling of unfortunate situations in Kapuskasing, Elliot Lake and with Algoma Steel has been short-term at best. I think the government could use the northern Ontario heritage fund to help develop and diversify aging industries in northern communities, and perhaps we can avoid emergencies such as these in the future altogether.

I think all of us here are familiar with recent events in Kapuskasing. Spruce Falls Power and Paper Co was offered for sale to its employees by the CEO of its parent company. If the employees were unable to assume ownership of the company, it would have been restructured, resulting in the termination of 1,200 of its 1,450 jobs, which would have devastated the entire community.

The option of employee purchase, however, hinged upon the completion of the sale of the company's hydro dam, Smokey Falls, to Ontario Hydro for $15.5 million. The agreement was that the dividends from this sale would be translated into shares which would be given to the employees of Spruce Falls, with restrictions to ensure employee ownership and included 80 years of free power to Spruce Falls by Ontario Hydro or the cash equivalent of approximately $15.6 million each year. Ontario Hydro's agreement to the deal, however, was contingent upon the provincial government's environmental approval of the redevelopment and transmission upgrade plans for the Mattagami River.

The Minister of Northern Development appeared to enter into the negotiations, but the citizens of Kapuskasing refused to give up hope for a settlement and brought their plight to the forefront of provincial debate through the use of media and a rally at Queen's Park which was sponsored by the leader of my party. After much demonstration, the Premier decided to take the matter into his own hands and negotiated with Kimberly-Clark himself. The final agreement was identical to the initial agreement except that the 80 years of free power Ontario Hydro had agreed to became 10 years of free power and $60 million in cash. This amounts to $20 million in excess of the initial agreement. Furthermore, the provincial government accepted liability for the sale of the Smokey Falls dam should it fail the environmental assessment, which could cost the Ontario taxpayers several millions of dollars.

The deal provides the workers in the community what they asked for -- not handouts, not guarantees, but an opportunity to turn hard work and sacrifice into shared success. What I do not understand is why the government allowed the situation to get so far out of hand.

We have the example of Elliot Lake. Ontario Hydro had been buying uranium from Rio Algom and Denison in Elliot Lake for the past two decades. The deal signed with these two companies called for Ontario Hydro to guarantee a price that covered production costs and provided a margin of profit. Shortly after that deal was signed, the market price for uranium dropped; however, Hydro was committed to paying an inflated price for the Elliot Lake product.

Due to the fact that the Elliot Lake uranium industry could not compete with western strip mining operations, Rio Algom and Denison could not attract new customers. As a result, 2,300 layoffs were announced by these companies in early 1990. On April 30 of this year, Hydro announced the cancellation of its contract with Denison. There will be 1,050 jobs eliminated in the second quarter of 1992 as a result.

Last June, the Minister of Northern Development announced that Hydro's contract with Rio Algom would be extended until 1996. This marks the beginning of a major transition program for Elliot Lake out of the uranium industry, and the government has required Ontario Hydro to contribute $250 million to initiate the process. Approximately $160 million is the cost of Elliot Lake uranium above the market price. Another $65 million will be directed towards economic diversification projects and $25 million is designated for the development of private generating facilities in the region. As a result, the economic responsibility of Elliot Lake has fallen to Ontario Hydro.

I think perhaps we should be looking at this situation as a commitment from the government, and the northern heritage fund, if you like, not Ontario Hydro. I think the fund is the entity that should be assisting Elliot Lake. I do not think Ontario Hydro is mandated to provide the province's social programs and to provide economic benefit to the residents of any part of the province. That is what government is for. If you want to do something like that, I think the appropriate vehicle is perhaps through the northern Ontario heritage fund. I do not see Ontario Hydro as a social service agency. I do not think that is the reason it exists.

It is somewhat ironic, if not a conflict, that the government would extend the contract between Ontario Hydro and Rio Algom when it had previously announced it had a moratorium on nuclear expansion. We are still waiting to have a clear indication of the path the government will take to assist the workers of Algoma Steel. I hope the government will realize that the artificial bolstering of the industry will not provide long-term solutions to the problem.

I am quite concerned about Bill 118, An Act to amend the Power Corporation Act. If this proposed legislation is passed in its entirety, it will set a dangerous precedent and turn electricity bills into a tax grab, or at least a potential tax grab, by any provincial government. It would afford the minister new powers which would allow him or her to issue policy directives that are binding on Ontario Hydro even if they have nothing to do with Ontario Hydro's reason for existence -- which is, by the way, the production of safe, reliable energy at cost to Ontario consumers.

Bill 118 is the end of the province's long-standing principle of power at cost and it will change the relationship between government and Ontario Hydro. It will force rates up; it will result in economic hardship for residents and businesses in Ontario; it will discourage and prevent future economic growth and, perhaps somewhat ironically, it will probably hurt industries and residents of northern Ontario more than those in the south.

Bill 118 changes Hydro's mandate to include anything the government says it should, such as social assistance or regional development. Consumers will then pay for these directives through electricity rates. At least the experience in Elliot Lake would seem to indicate that the government plans on making Ontario Hydro an agency for funding social programs. Public utility commissions across the province are united in their opposition to parts of this proposed legislation, and for good reason. I think it would be very interesting to see what effect this proposed legislation will have on user rates throughout the province.

Meanwhile, there are over one million Ontarians on social assistance and some 60,000 farm families in the province whose incomes are being reduced. At the same time, the provincial government is increasing the total public service payroll by some 14.5% this year. I think the government should be rethinking its priorities.

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I read the minister's press release of October 28 with some interest. At the time she announced a new program entitled the Strategic Consultation and Action Now North, SCAN North. This is supposedly a grass-roots consultation program for northern Ontario which will consist of specific projects initiated by the ministry on the advice of northerners.

I am extremely concerned that this announcement, which contains no real monetary guarantee for this fiscal year, has been designed without a real commitment from the government. Five sections of this program will hold a series of roundtable discussions focusing on mining, forestry, small business and native entrepreneurs, native economic development in the private sector and waste management and recycling.

I am surprised there will be no discussion about the transportation issues in northern Ontario which have a definite impact on the lack of economic growth in that region of the province.

The Chair: Mr Eves, excuse me. You have two and a half minutes.

Mr Eves: I think we could probably spend more than seven and a half hours merely discussing the transportation issues in northern Ontario. For example, when I was first elected to the Legislature in 1981, one of the most important issues in my riding was the four-laning of Highways 11 and 69. We are in 1991 and it still is. I have met with more ministers, more interested individuals, written more letters and introduced more petitions regarding this issue than I care to count.

I really think the government has to make a commitment and not just mouth the platitudes from time to time that yes, it is committed to four-laning Highways 11 and 69, but it cannot give us an exact timetable; or if it does give us a timetable, there are always economic reasons why it cannot deliver on the timetable.

I can recall in the last provincial election a document called Agenda for People. It was quite clear as to what the policy of this party which is now in government would be if it were elected. There were no ifs, ands or buts attached to that commitment. It said that this government, if elected, would spend $100 million each and every year of its mandate, without exception, on four-laning the TransCanada Highway through northern Ontario.

I do not care whether the federal government is committed; where is your $100 million? Where is it being spent each and every year of your mandate? Where is the $400 million Mr Rae promised to spend in the first two years of his mandate? He did not mention economic recession and ifs, ands or buts, if the economy is all right, if this, if that.

Mr Brown: Oh yes, he did. He said we were in a recession.

Mr Eves: I think Mr Brown is quite right. The Treasurer pointed out that anybody would know in April 1990 that we were in a severe recession. I believe the Treasurer said that. I do not see how he can use that as an excuse now at the end of 1991. He knew in April 1990, long before the provincial election of September 6, 1990, that we were in a very severe economic recession, yet these commitments were made in the Agenda for People. I think the government should deliver on them.

I would like to commend the minister with respect to the creation of the marketplace program. I believe this three-year pilot program is very innovative and I think it will go a long way to assist businesses in northern Ontario and to access private and public sector procurement of markets.

The only other issue I am going to touch on very briefly, Mr Chairman, with your indulgence, is the migration of young people from northern Ontario to southern Ontario.

Between the years 1981 to 1986, there was a net loss of some 25,000 young people between the ages of 15 and 24. This accounts for some 15% of the total population in this age group migrating to southern Ontario. I think we really have to develop something with respect to the education system, the university system, as well as diversifying our economic base to give our young people the opportunity to remain in northern Ontario where most of them would prefer to be. I think there is a very direct role the government can play in this. Education is a starting point for developing the economy in northern Ontario.

I am pleased to have been able to attend here this afternoon. The main point I am trying to stress is that I think the government has to have a more proactive role with respect to the development of northern Ontario than has been shown to date, at least in my opinion. I look forward to working with the Ministry of Northern Development to try to correct what I perceive as some very basic inequities within the province.

Hon Miss Martel: I would like to thank the member for Parry Sound for his comments on a broad range of issues which I find to be most helpful. I will try to respond to as many as I can within the next bit of time and then we can go from there.

First, I appreciate the concerns he has raised with respect to the northern health travel grant program and I also appreciate the work and the participation we received from him with respect to trying to get his constituents actually receiving the money in the two areas designated under travel grant.

I was surprised at the statement he made in the Legislature some weeks ago that doctors who are now outside the underserviced area program are not having their patients also qualify even though they are being sent to the south, because I certainly hoped that in the work we had done with the Ministry of Health we had fixed the outstanding problems. Obviously we did not, and I should have followed up at that point, because I was in the House when he made the statement. I would appreciate it if he would give me some of the information as well so I can talk to the Minister of Health and her staff about this and we can see if we can have another go at it.

Second, I want to spend a little bit of time on OMA agreements, because it concerns me as well. A number of us have spent some time fighting for northern health care and institutions and doctors and the whole gamut and do not want to be in the position where we see an erosion of that. I also recognize that we need more of the same, more people coming and staying.

You have raised in your remarks, and I will point out again, that a number of physicians and specialists in underserviced areas have already been designated by the ministry for exemptions. I understand that a list was being completed last week in a meeting between the joint committee representing the OMA and the Ministry of Health, although I do not have a copy of that document and I am not sure if it will be released for public use. I am advised by the minister that a number were exempted and the final rounds, at least for the meeting last week, were also being added to that list.

I have a concern about what is happening in Sudbury. That was one of the reasons the Treasurer and I met not only with Dr Donahue but also with representatives particularly from obstetrics and cardiology on Friday afternoon. We have done a couple of things at this point. First of all, I was not aware there were problems with respect to Dr Donahue. The cardiologist, yes, I knew, because I had written in support of their efforts some time ago.

Dr Donahue wrote us a letter that I received about two and one half weeks ago asking for support. I wrote to the minister and also agreed to meet. We have, at this point, asked the Ministry of Health directly through the deputy, to have a meeting in Sudbury specifically with Dr Donahue, a representative of the OMA and his peers from Sudbury, if he would have that. I would like to be there if I can, or a representative from my office, so that we can have a good look at what is happening with his particular practice.

He reached his $400,000 threshold some time ago. He is operating right now in the $450,000 to $500,000 range, as I understand it from this meeting. So he is getting some money, but certainly he does not feel this is enough to cover the costs he has. He agreed that he would be more than prepared to bring his accountants, etc, to such a meeting and we are hoping to have that arranged as soon as possible. At the same time, we will be having another meeting, hopefully on the same day, among the other representatives who were at the meeting to talk about their concerns specifically.

Let me make a point on the obstetricians, which is a case I am a little more familiar with. We did spend some time early in the summer attempting to get two obstetricians to Sudbury. At that point there were two who were prepared to come. The city had not been designated as an underserviced area for obstetrics, and we were working with the Ministry of Health to try and get that designation so those two obstetricians could come to the city and qualify for incentive grants in order to stay.

It is my understanding that discussions between the obstetricians and other general practitioners did not go all that well and at the end of the day the designation did not come through. However, we called the underserviced area program yesterday. We have arranged a meeting with the doctor who is in charge there to find out what is happening. It is our feeling that if we can get the area designated, there may be a possibility that we could still get the two obstetricians, which would not only decrease the workload of the five who are working there but would also decrease the likelihood of any of them hitting their cap. That is one way I am pursuing right now, although there may be options.

With respect to the cardiologists, I know there is a definite problem. I have met with them before about this. I have all their concerns on file along with all their costs, etc., and I am hoping that in a meeting with the Ministry of Health we will be able to find a way to resolve this problem, because it is not my desire to see any of these people leave the community. They make a tremendous contribution, not only in terms of the health care they provide, but on a purely social level. In the community they are involved in all levels and all kinds of good work and I would not want to see them go. We made that very clear to them at this meeting.

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You mentioned cancer treatment, and I just want to follow up on that. You asked why we were not encouraging more cancer patients to come to Sudbury. I can tell you that about three months ago, Dr Corringham signed a statement of relationship, I guess is the best way I can describe it, with North Bay to service its cancer patients.

Right now they are being served by the Princess Margaret Hospital, and Dr Corringham had for some time been trying to negotiate directly with Princess Margaret to have their patients looked after by our cancer treatment centre either on an outreach basis or having them come to our centre to be treated. It was my understanding it had been signed and efforts were being made to have those patients looked after in Sudbury. Efforts are being made on that front, and that particular move was certainly supported by the Ministry of Health. I hope we can see more of that.

I know there are also some efforts to try to have outreach into Timmins so the people did not have to come to Sudbury but could be looked after in their home community. I cannot tell you, though, how those are going.

With respect to the northern Ontario heritage fund, Arne Sorensen, the general manager, is here and he might want to make some comments, particularly on the division we are now seeing between strictly our funding of small business and some of the funding we are doing to maintain employment levels in northern Ontario, because there is no doubt there is a mix of the two going on.

I cannot tell the member that I have been at all the board meetings. We had a very good go around with the former board about this some months ago when it became very evident that the people who were coming before the board were coming not because in essence they were going to create any new employment but because they were desperate to try and hang on to the employment they had.

There was a general go around at the board about whether that was the role of the board. It was agreed among members that the situation in the north was so bad now that we could not turn our eye away and let companies go down and lose the employment already there and that we had a dual role to play: one, to try and fund whatever new businesses were out there and looking for incentives and, two, to keep those who were continuing to operate, who were very important in many communities in terms of that being the only industry in the community. It is also very important to respond to them with financial assistance to maintain the employment levels in those communities. There was a very good go around at the board about it.

It was agreed that was our role and would be the way we should consider all applications coming before the board, so we have had funding of a mix of both. For example, through the heritage board, we have had money flowed by Treasury to help out particularly in sawmills. In most of those cases -- I will not give the names of the companies -- it was not a case of buying new machinery to increase the product line, it was strictly a request for working capital to get through the hard times and we have funded, in many instances, those requests; not all, because in some cases the request was far beyond the board's capacity to meet. After an analysis between my ministry; the Ministry of Industry, Trade and Technology; the Ministry of Natural Resources, and in some cases the banks, it was not an operation that was going to continue in the long term, and giving money would only prolong the agony.

We have tried as best we can to pick and choose, and that is the best way to describe it. Those we thought had the best chance at survival, based on timber limits, who they were producing for and selling to, the age of their capital in their own plants, we have provided in those cases strictly working capital, which is different, I think, from what the fund was originally set up to do.

If you want more details on some of the other strictly small businesses, Arne is at the back, but I will wait and see if you want that.

Mike Brown and I had this discussion about what I had said about the heritage fund on Thursday last and I agree with you, there is not enough money in that fund. We will have allocated, and did allocate by September of this year, $62 million in the time from last October to September, allocated everything that was there, plus any of the excess left from the first two years that the board kicked in.

I wish we had more money because we could use more money, there is no doubt about it. But as I said to the member and will say to you today, the situation I find myself in, along with every other minister as we go before the treasury board at this point, is how we are going to maintain the programs we have. It will be very difficult to keep all my programs in place. I do not have any extra money to put into the fund, much as I would like to, because I think there is a need for it. I said to him that was one of the areas I had undertaken and given a commitment that there would be no decrease in that $30 million. The decreases we will have to eat will be found within the ministry. I do not know where they will be yet or what we will be directed to do. Certainly the $30 million will stay, but I cannot add any more to it at present.

You mentioned some of my comments from the debate with respect to having the board be more representative. You would know that in June of this year many of the appointments for the previous members were up and it fell upon us to decide who we would reappoint and if we would make new appointments. We made a major change on that board. We put 14 new members on and we retained six.

I did that because I did not think the board was terribly representative of the face of northern Ontario society. We now have a board that has a strict division between men and women, so we have 10 and 10. We also have an equal number of people representing labour backgrounds and an equal number representing business. We have added two more native representatives to the board, so we now have five.

This is not to say that the former members were not committed to northern Ontario, because they certainly were and they demonstrated that at all of their meetings and in all of the deliberations we had. But my sense was that, given that most of the appointments were up, people had served for three years and there was an opportunity to make a change. The onus was on me to try and do that and reflect what I thought was more of a northern society. I am pleased with the new members we have on. We are meeting for the second time on Friday. They are a very good group. They are as committed as the last, and I think overall we will continue to run in a very effective way.

I want to talk a little bit about NODA. I do not know why you are having such a problem and I cannot respond to that in terms of getting information, because certainly the information we have had in our ministry has been developed into a package we have been trying to distribute to our client group -- I speak strictly on the mining side -- as much as possible so they will have the details.

The releases we had on Monday last, when we made the announcement on the mines side, included not only the overall $30 million total but also specific initiatives that were taking place in four communities, Sudbury, Thunder Bay, Timmins and Kirkland Lake-Larder Lake, and we had the specific details with respect to the funds and the projects and the mapping and the work we would be doing in each of those communities. So I can give to you without much difficulty what we will be doing on the mines side and who is co-ordinating that and the projects we have already targeted. Certainly on our side, before the announcement was made, we had done a great deal of work getting the projects ready and up, and some of them in fact had started.

I should also point out that Mike Barker, who is here as my assistant deputy minister, will also be sitting for Ontario on the committee that will be overseeing NODA, so we do feel we certainly have a direct line from our ministry into what is going on through this agreement. He advised me earlier that they have not had a call to meet yet, but I certainly can say that any concerns we hear that are raised during the process should be directed to me to be directed to him or to him directly.

I know it is not as good as the 1985 agreement, and you are quite correct. I can only tell you that the mines side has stayed the same, the $30 million commitment is the same, and it probably should have been more if you were adding inflation.

However, I do want to point out that after much negotiating with the federal government on the forestry side, frankly the federal government was not prepared to put any more money on the table. The negotiations went on for some time. A take it or leave it stance was adopted in the end, and I think the representatives on the provincial government side felt that $95 million during these times was certainly better than nothing and we could do a great deal of good work with the $95 million regardless. I regret that it is not more. However, faced with the position of take it or leave it, we took it, and this after many months of negotiating with the feds and trying to encourage them to put more money on the table.

The target of that funding is the primary resource sector: forestry, mining and tourism. Highways were not included in the former agreement, nor was there any effort made by either the provincial counterparts on our side or the federal counterparts to include highways in this agreement. It was targeted for primary resource sectors.

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With respect to Kapuskasing, Len Wood is here and he might want to make some comments later on, but let me make a couple of comments. The final agreement did have what we felt were some significant changes. If you will recall, when I announced that we were not in a position to deal with the proposition that had been put before us by the purchasing employees' group -- that was the original employee ownership group that was first established in the community -- I said that the government felt that not everyone had given, and in order to make this thing work, because there were some outstanding expenses from all sides, people would have to give a bit more. We were prepared to continue to negotiate and continue to look at any new plan which might come forward, but we could not commit to the plan that had come before us that we had been looking at intensely, certainly as a ministry along with other ministries. But ours was in the lead up until the deadline at the end of June.

The changes I felt were significant. Kimberly-Clark went from $40 million to $60 million with better loan provisions to the new company, which will be operated under what is called the employee ownership group. Tembec, besides putting an initial amount of money on the table, then agreed to put in $15 million more over three years, so it upped its contribution. Third, the change in the 80-year free power credits was quite significant and better reflects what the needs of the group are as discussed with us. That has been done in terms of putting a monetary value on those 80 years of credit. We give money directly up front and we also double up on the power credits. They are flowed to the company up front in the first number of years of the development, when they will frankly not have a lot of money to be paying any other bills with.

It was not easy the first time round to say no. I did not enjoy it at all. I do not think Len Wood, who had to live in the community, found it particularly heartening either to have to say no, but the deal that we arrived at the second time is much better. I should just bring members up to date.

We have moved along very substantially on a number of the legal questions. There will be another three sets of legal questions that will have to be decided during this week. We understand all ministries are on side. So far the whole thing is proceeding. We received some good news from the community that the fund-raising efforts were quite significant over the weekend and that the community has really almost reached the amount of money it said it would dedicate. That looked a little better than last week, when they had only $2 million. I do want to congratulate the community for its efforts over the last week and to raise its share.

I do not think that what we did in Elliot Lake was social assistance. I would never categorize it as a social assistance package to Elliot Lake. Mike and I also went through this. Let me put my response on the table again. Hydro is a significant employer in this province. It employs thousands of employees. It also has billions of dollars worth of assets. It also has a responsibility, I think, to a community that has existed solely for those contracts in the last number of months. Rio Algom and Denison produce uranium now strictly for use by Ontario Hydro, so I see their obligation in that community as a corporate one and a social one. I think that Hydro, as a responsible corporate citizen in the province, did have an obligation to the community. The diversification package that was announced by myself on June 17 is very much a reflection of that.

I think the government had a number of choices. We could have told Hydro to cancel both contracts immediately and allow Hydro to walk away and allow that whole community to fall apart, even though it was only producing uranium for Hydro purposes. We could have asked them to continue to produce the uranium in both mines over a longer period of time, which is certainly the reason that the community was built. Much of the intention, when the first contract was signed, was that they would go to somewhere in the order of 2010, but again, the premium that had been paid over the last 10 years was in the order of $1.2 billion, which is tremendously significant and a price we do not think energy users in the province would have continued to pay. Certainly they were paying that on their Hydro bills.

I believe we found a happy medium in Elliot Lake. We have Hydro maintaining its corporate and social responsibilities by continuing to produce at Rio, so we have some mining component that goes on in the community in order to make the transition from a mining community to a more diversified economy. Second, we have money that is set aside for diversification efforts -- not only in Elliot Lake but in the four other communities along the north shore -- which will also aid them in making that transition.

We have two things happening concurrently: first, the mining sector still intact but winding down and those jobs and that payment and income coming into the community; and second, a substantial effort on the other side, on behalf of the working group, to attract new businesses, to increase the efforts they are making with respect to retirement living; with respect to health care, the drug and addiction services that are there, and with respect to some of the work that will go on with Laurentian University and others in decommissioning and mineral research to give that community and the others along the north shore the opportunity to make that transition.

I would argue with you, as I did with the Liberal member, that I do not and will never view it as a package of social assistance, ever. I think what we did and what Hydro discussed with the member was to very clearly ensure that Hydro, which had a role to play in the community, assumed the role it should have.

That leads into Bill 118 and the comments I heard during the debate that Ontario Hydro would now become a policy arm of the government or would have to respond to further government directives like social assistance. Again I point out to you that I do not feel what we did in Elliot Lake was social assistance, and I speak on behalf of the government when I say that.

I also notice that on October 2, in response to the debate that had gone on in the Legislature on Bill 118, the Minister of Energy stated very clearly in the House that he would be proposing amendments to make it very clear that policy directives that are issued must relate to the corporation's exercise of its powers and duties under the act and not lead to an extension of those powers and duties by means of government directives.

I think the Minister of Energy has made it clear to the House that when this committee goes on the road, and when it moves into clause-by-clause, he will be moving amendments. I do not have copies of them and I do not expect the standing committee on resources development does at this point either, but certainly he has listened to the comments that were raised and wants to make clear the direction the government is heading in.

I want to talk about SCAN North. The member stated that he was surprised there was no discussion on transportation, because this is an important discussion. I agree, but I would ask you to go back to the release and look clearly at what we have said, which is that for the moment the five areas we have identified in terms of task forces and work are the five we would like to do in the immediate future.

That did not in any way negate any other ideas or issues that would come forward. In fact we saw very much the role of roundtables or task teams or task forces, etc, to look at other issues as being very much part and parcel of what this program will do. We fully expect that a number of initiatives will come in from across northern Ontario, and indeed they have since we announced the program, from other people who are very interested in using the program in order to develop their own thoughts and have discussions about their own particular interests.

I should point out, on the question of transportation, that the member for Sault Se Marie questioned me about whether or not we could have a dialogue on the role of Algoma Central Railway, for example. Given what is going on at Algoma Steel now, the uncertainty of the future in Wawa and the uncertainty of the whole railway system, he would very much like to have the unions, the company, the local members and other interested parties involved in dialoguing on that and on the longer-term role. We are certainly looking at that as another possibility under this whole rubric which we have called SCAN North. So the five we have identified are the ones we are particularly interested in starting on immediately, but that in no way, shape or form disallows other people coming forward with ideas as well.

Two other things: I talked about An Agenda for People and the $400 million over two years for the economy and northern development in the north, and second, the money that was to be committed for roads. I point out to this member, as I did to his colleague when I was speaking about this last week, that in this last fiscal year, through the anti-recession program alone, we committed about $210 million to northern Ontario. That was strictly through that program. We committed $15 million in Elliot Lake. We committed another $15 million to our sawmill initiatives. We did the deals both in Kapuskasing and Elliot Lake and have done another major deal in Atikokan through the heritage fund. So in this fiscal year, in spite of the difficult times, we have put well over $200 million into northern Ontario.

What will happen in this fiscal year, I do not know. I suspect we will not be putting that kind of money in. I do not know what my budget will look like at this point in time and neither do the rest of my colleagues as we go through this process of estimates before treasury board. I can say clearly to you that at least in the first commitment with respect to $400 million, $200 million has gone in this year. It has not gone in on the transportation side; I would fully concur with the member as he raised that in his deliberations.

Finally, with respect to the youth migration report, he will know that our initial response to the report released last January was to assume responsibility for a program that the Ministry of Colleges and Universities had, with some small measure of funding, to try to encourage employment during the summer. We took that over, added substantially more funding to it and changed the program criteria. This year we have run through a program that we call the northern training opportunities program, an effort on behalf of our ministry not only to employ students over the summer but to have an ongoing hiring of students right through, after their academic studies and hopefully into permanent employment with an employer.

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We have established four categories for that:

The first component is strictly summer employment for students going through high school.

The second component is students who are going to university whom we are trying to keep in the community during the summer rather than have them seeking employment in the south. They may not come back to finish their studies with employers who we hope will make every effort to offer skills training and a permanent position for those employees at the end of the day.

The third component is an internship program, which is a year in an establishment with an employer who has every intention of hiring that person at the end of the day.

The fourth component is to try to provide employment opportunities for historically disadvantaged workers, natives, students, women, the disabled, etc, who would be working with employers who also might normally not be making an effort to hire.

We ran a very good program in Dryden this summer where we hired native students to work with the police force. We found that to be very successful.

We had 2,500 applications and students placed. We will be running eight community consultations during the fall and winter to assess, from the participants on the employer and the employee side, how the program has worked.

Most recently we have begun some work with Cambrian College to try to have Nortop respond to its co-operative education program. They would like their students who are going through co-operative education and who will be looking for an employer with which to do their four-month or eight-month compulsory training to be able to qualify for Nortop. It is my understanding, speaking to the teachers at Cambrian last week who are most involved in this, that we are close at arriving at an agreement to have Nortop work in that way so the students could be assured that when they go out they can look for a job they think will be very suitable, approach the employer, tell the employer about Nortop and try to find a posting there which we hope will lead to a long-term solution.

That is what we are trying to do with the co-operative education program at Cambrian. We will be looking to see what we can do at other colleges if there is some room to move in those colleges as well.

I think I have had enough. I will stop for the moment and entertain some more questions.

The Chair: How am I to interpret that you have had enough?

Hon Miss Martel: I mean I have had enough speaking.

The Chair: That is fine. We will move to our regular rotation.

Mr Eves: I still want to pursue a few points I raised in my initial remarks. The minister says in her response, with respect to the health care problems we are seeing or at least the complaints we are receiving from the medical community in northeastern Ontario, and Sudbury in particular, that the Minister of Health is still negotiating and that no final decisions have been made. If I am incorrect in putting it that way, I wish the minister would correct me.

I find that somewhat confusing and so does the Ontario Medical Association, in view of the fact that I have a letter here signed by somebody by the name of Frances Lankin, MPP for Beaches-Woodbine, Minister of Health, dated November 14, 1991, which I believe, if I am not mistaken, was last Thursday. It is addressed to Dr Abdulla, a cardiologist in Sudbury who I am sure you are well acquainted with. It reads:

"After intensive consultation with the Ontario Medical Association, I have decided not to extend further exemptions to threshold payment adjustments for 1991-92."

That sounds like a pretty definite statement to me. The decision has been made. The minister has made it unilaterally and she has decided not to grant any further exemptions, so I do not know what you are discussing. She has made the decision. The decision is made and it is game over, unless she is now admitting she made a mistake, is willing to reopen those negotiations and is going to reconsider the decisions she made last Thursday when she signed this letter.

She goes on in the letter to say:

"This decision has been made as a result of the severe financial pressures being felt by the Ministry of Health and the entire government of Ontario. I feel it would be inequitable to allow more exemptions at a time when hospitals beds are being cut and other sectors of our health care system are being asked to reduce costs significantly."

That sounds like a pretty definite statement. I sounds to me like she has made up her mind and it sounds to me like she has communicated that to Dr Abdulla. If she has not made up her mind or is now admitting that she made a mistake when she signed that letter last Thursday, I would be interested in hearing further about that.

I also have a letter in front of me signed by Mr Adam L. Linton, the president of the Ontario Medical Association, addressed to the same Frances Lankin, Minister of Health, dated last Friday, November 15.

"I am very disappointed to learn, in a letter from the deputy minister to Dr Moran dated November 13, 1991 that, after months of discussions, your ministry has disregarded our advice and has unilaterally decided not to consider any threshold exemptions beyond the small number of physicians who are in the government's underserviced area program, who were already exempt under the agreement.

"The OMA firmly disagrees with your decision. While the OMA reluctantly agreed to thresholds during negotiations, it was with the understanding that some physicians such as those providing unique services, sole providers in rural and remote areas, among others, should be exempt from the thresholds to ensure the provision of necessary care to their communities.

"Certainly throughout the consultation process with the OMA on criteria for appropriate exemptions, there was no discussion at all of an across-the-board no-exemption policy.

"The OMA has advocated, and will continue to seek, a reasonable process with fair criteria to evaluate applications for exemption on a case-by-case basis that would involve the OMA, your ministry and a public component to make recommendations to you. I am not sure what the impact of your decision might be; however, I am not convinced that every physician will be able to continue providing the same level of service to the people of Ontario at rates that, in some cases, will not cover the cost of providing those services.

"I strongly urge you to reconsider this decision and allow us to develop a flexible and responsive set of exemption criteria.

"Finally, I should indicate that I do not agree with certain assertions in the November 13 letter regarding exemptions to thresholds that you claim to have already granted. The OMA position has always been that all technical fees were exempt under the agreement, and when the positive understanding regarding our differences in interpretation was reached earlier this year, there was no indication that the government was even considering a blanket no-exemption policy."

That is the letter in its entirety.

I also refer you to paragraph 10 of the agreement itself, which says,

"(a) Threshold payment adjustments set out do not apply to

(1) physicians working in underserviced areas by arrangement with the Ministry of Health under the Ministry of Health underserviced area program," -- that is the people who are already in -- "or

"(2) where the Minister of Health determines, to physicians working in particular geographic or specialty areas.

"(b) The government agrees to consult with the OMA in developing guidelines for determinations under paragraph 10(a)(2)."

It would seem to me that the Minister of Health has breached that clause in the agreement. She has breached clause 10(b). There are no guidelines developed in consultation to determine who should be and who should not be exempt, or what particular geographic area of the medical profession should be exempt, or what specialty area should be exempt. She has said, "I have listened to you. I disagree. I have made the decision. Get lost. I am not going to give you any more exemptions." That is what she says in her letter. It is there in black and white.

If she has made a mistake, why did she not just stand up in the House today when this matter was raised and fess up: "I made a mistake. My colleagues in Sudbury don't like it. The Treasurer is giving me hell. So is the Minister of Northern Development and Mines. I am going to reconsider my position and I am sorry I ever signed the letter of November 14."

That is what I would expect from somebody with character. However, I am still waiting for a response. Has the decision been made or not? You and she seem to disagree on that. If it has been made, are we now admitting that it is a mistake and are we going to reconsider our decision of November 14?

Hon Miss Martel: In my response to the earlier question, I said that the reason we were having the meeting we had asked for -- the meeting to talk not only to Dr Donahue but also to the cardiologists and to the obstetricians -- was to search for a way to see if we could resolve this problem. I do not think I said specifically that the Treasurer and I had gone to the minister and told her that we were coming solely to ask for an exemption and that unless it was provided we would beat her up in the House or in public.

Let me go back to the case of the obstetricians, because I think there is some room to move which would have little to do with the threshold. Let me go back on this particular point. Two of those obstetricians will reach the cap some time in February. We had been working with the Ministry of Health earlier in the year to try to have Sudbury designated as underserviced for obstetrics in order that we could allow people who had gone through as obstetricians to serve in that area as underserviced and also pay back the government if they had gone through the underserviced area program.

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We are working right now to see if that is still an avenue we can explore, because it is my understanding that although the negotiations were going on with the Ministry of Health and the doctors in Sudbury, it did not reach a successful conclusion. I do not know the reason for that, but I do know there were two obstetricians who were quite prepared to come ASAP if the designation could be granted.

I have given an undertaking from my end in terms of the division of labour between the Treasurer and me, as to how to respond to our meeting, that I would go back. I have arranged for a meeting with Dr Brunet, who is heading up the underserviced area program, to try to deal with the obstetrics question, because I think there is a way around it which would not involve exemptions on the cap and which would not get into the letter you have referred to that Frances sent to people saying there would be no further exemptions.

With respect to the cardiologists, I do not know what can be done, if anything can be done. Five of them have been very good to share with Floyd and me their concerns during the course of the signing of the agreement and the meetings between the Ontario Medical Association and the Ministry of Health about who should be exempted and why. I cannot speak to what avenue I can look at as a cardiologist who might be outside the exemption. I do not know if there is room to move in that area.

I cannot speak for the Minister of Health breaching the OMA agreement. I think you would have to raise that with her because my understanding was that a number of physicians in underserviced areas had been exempted. As per this agreement, a list was being put together for that. As to the decision that was reached last week, I was not at the meeting so I cannot respond to what decision was reached and why, and what was said at the meeting between the OMA and Michael Decter and whoever else was there.

I can only say at this point that we have given an undertaking to the group in Sudbury, who expressed their concerns very directly to us on Friday in a very good and frank meeting, that we will do the best we can. I do not know if we can fix the problem. I hope we can. If we cannot, then that will be a political dilemma I will have to deal with very directly, and I understand that. I think there are some avenues we can follow. What we are trying to do at present is to get the meetings in Sudbury as soon as we can, to sit down with the parties that have been affected, where the politicians are also at the table, and try to see what we can sort out.

Mr Eves: I would ask you, in your role as Minister of Northern Development and Mines, to take the plight of northern Ontario residents, especially in this case residents in your own community, to the Minister of Health, because the Ministry of Health seems to be quite adamant in its position. Sure, there is a list of exemptions, but the second part of that paragraph, which the Minister of Health seems to be conveniently forgetting, is to sit down with the OMA to determine guidelines in consultation with the OMA on what further exemptions the Minister of Health determines should be granted in particular geographic areas or specialty areas. It appears to me that she has listened to them; she has not, if I can believe the letter from the OMA, developed guidelines in concert with them. She has listened to them and said, "I think you're wrong and I'm not doing it and I have no intention of sitting down developing guidelines for something I'm not going to do, period, end of discussion." I am pleased to see that perhaps you and the Deputy Premier and Treasurer might have some impact on the Minister of Health in what I think is a decision that should not have been made.

I have a couple of other questions with respect to the four-laning of the Trans-Canada Highway in northern Ontario. I wonder if we can expect to see some movement on that commitment or promise made by Mr Rae during the election campaign of 1990. Mr Brown points out to me, and rightly so, what of the minister's promise during that same election campaign to purchase 100% of the uranium produced at Elliot Lake? I think these are a couple of issues or questions that we should have addressed. Can you tell me the total number of dollars spent this past fiscal year by the northern Ontario heritage fund -- perhaps you might have done that in one of your responses; I cannot quite recall now -- and do you consider that to be an adequate expenditure?

Hon Miss Martel: My understanding is that we have allocated $62 million since October 1, 1990, up until September 1991. Is it adequate? Probably not, because we have allocated everything we can and we will probably allocate everything we have this fiscal year as well. We have a significant number of requests, for example, coming through to the board on Friday which, if all passed, would represent several millions of dollars more. We will no doubt allocate everything we have to allocate by the end of the fiscal year before we get our new $30-million allocation.

I am not sure, Arne, if there is anything else that could be added or that you would want to add to that.

The Chair: Please come to the front desk, Mr Sorensen, and introduce yourself. Please make yourself comfortable in the seat and speak directly into the microphone.

Mr Sorensen: I am Arne Sorensen, general manager of the Northern Ontario Heritage Fund Corp. The question, as I understand it, was the value of the commitments that have been made by the corporation in this past fiscal period. As the minister mentioned, it is in excess of $63 million. The total commitments to date have reached $130 million, in round figures. The corporation has received allocations totalling $120 million. Funds which are awaiting disbursement are invested to generate interest, and the interest earnings of those funds since the inception of the corporation have now reached $22 million. So we are really faced with about $20 million left on our cash reserves for commitment purposes between now and March 31, 1992.

Hon Miss Martel: Ernie, did you have any more questions specifically on the heritage fund that Arne might want to answer?

Mr Eves: Not other than that I wonder if you still agree with your comment of April 14, 1988, that $30 million a year for a northern Ontario heritage fund is, to quote you, "inadequate at best" and that the government should be making a commitment of at least $500 million over three years in order to put in place an adequate fund that would be able to continue over the long term. Do you still agree with that statement you made three years ago?

Hon Miss Martel: Given the shortfall we will have up to March 1992, that we will spend everything, I do believe the money we have there is not adequate. The needs we have seen since I have been here in the last year have been tremendous and we have responded as best we can as a board of directors to those needs, some in communities that otherwise had no source of funding to tap.

I would certainly like to see us be in a position to put more money into the fund, but as I said, given the fiscal constraints we are operating under, which I think everyone around this table is very much aware of, my attempts this year as a minister will be to make sure that every program I now have can currently operate. They may operate, and a good number of them probably will, at less money than we would like, but they all serve a very great purpose and I would not want to have any one of them cut.

The undertaking I gave the member for Algoma-Manitoulin last week was very much that this was one where we would not reduce any money but would be very hard pressed to find any more money to put into it. It would also, as I understand it, require a change in the act, and we are not in any way, shape or form in the position yet to undertake any more money or a change in the act to accommodate that.

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The Chair: Mr Eves, there are about two minutes left. I wonder if you would allow Mr Brown to have a short, quick supplementary.

Mr Eves: Certainly.

Mr Brown: Mr Sorensen, do you have any figures on how many jobs were either created or retained by the $130 million?

Mr Sorensen: Yes, we do. A total of 1,700 jobs were created as a result of the assistance provided by the corporation. They are private sector jobs. A portion of the fund has been disbursed and allocated or approved for public sector projects. We are dealing here with about $63 million in loans to the private sector, and it is those loans that have created that number of year-one jobs.

Mr Brown: Did you say $63 million?

Mr Sorensen: Yes.

Mr Brown: And those are full-time jobs?

Mr Sorensen: Yes.

The Chair: Perhaps, Mr Sorensen, you could share with the committee the more complete information you are quoting from, if it is broken down by sector or by specific employer group.

Mr Wood: Yes. I have a question, but I want to respond to one of the statements Mr Eves made in his opening remarks, that the situation in Kapuskasing they were talking about in the middle of June was the same as what the Premier announced in August. Having worked in that mill -- if I were still there, I would have been there 30 years at this time -- and having been at most of the meetings that were involved there, the situation in June, as the minister has announced, was very much different.

There were no labour agreements in place that had been negotiated. There was not enough money on the table from the board of directors of Kimberly-Clark and the New York Times, which owned the place. There was not enough money on the table from Tembec, and there was a lot of screaming and hollering on the part of the CEO from Kimberly-Clark. He did not like the way things were operating and he did not like Tembec in there. He did not like this and he did not like that. As a result, everything had to be renegotiated. It looks a lot different than it did at the end of June. I do not know where your information came from on that, but the research is definitely wrong as far as that is concerned.

The Chair: Mr Wood, I am going to give you a fair degree of latitude, but I ask you to focus on questions to the minister.

Mr Wood: Yes, I have a question. I thought it was important that I correct my interpretation of what it was. I agree with what the minister had to say.

The Chair: I appreciate your indicating it is your interpretation.

Mr Wood: The question I have is on the high price of gasoline in northern Ontario. It has been a source of concern for northerners for a number of years, probably going back 25 years or so. The prices in northern Ontario are not all the same. Kapuskasing is known now as one of the highest places -- Kapuskasing, Hearst and some of the other areas. A number of people, including myself and, I believe, some of the people from Sudbury, and maybe even yourself, Minister, campaigned on lowering the price of gas in northern Ontario. What have you done about the high price of gasoline in northern Ontario?

Hon Miss Martel: The Treasurer made an announcement in the budget that the motor vehicle licensing fee would be removed so that northerners would not be paying that fee, in order to provide a bit more of a balance of equity. Within our own ministry, we have done two things. We continue to be concerned that there is a pervasive sense out there that nothing can be done. We have spent a great deal of time, between our ministry and the Ministry of Energy, looking at what has gone on in other jurisdictions; for example, in Nova Scotia and New Brunswick.

We decided in this ministry that if we were going to get at the problem and find out whether this was going to work and whether we could deal not only with the basic inequity between north and south but with the regional inequities within the north, which is also a great problem the further north you go, then we should do our own work within the ministry and have that work done by someone from outside who could look at the other jurisdictions and see what had happened there. They could see whether the move towards parity and pricing across both of those jurisdictions had in fact worked to the advantage of motorists or had worked to the advantage of the gas companies involved, which was something we were concerned about.

We have developed within the ministry terms of reference in order to allow that work to proceed. We have asked that particular attention be paid to jurisdictions where gas pricing has been equalized, to actually do some work with the legislators and the ministries in those particular jurisdictions to find out what resulted and what their sense was of who was benefiting and how.

Second, we were given information with respect to co-ops operating very successfully in Thompson, Manitoba, for example. We approached the Steelworkers in Sudbury to see if they were prepared to work with our ministry in developing a co-op in Sudbury and seeing if that would work. At the time they were in negotiations and had other things on their plate and just did not think they had the bodies around in order to develop that.

We have made contact with Co-op Gas in Verner, which is now interested in working with a community where representatives may have expressed an interest in taking a look at a gas co-op. One of my staff people has been calling some of the northern members to see if they think they have a community that is big enough and whether there is some interest expressed in the community to work with the co-op and our ministry to see if we can establish a co-op in one or two separate regions in northern Ontario. He has been undertaking that, but I do not know what the result of that call-around has been.

Mr Wood: Okay, a little bit on the heritage fund, Minister. I am interested in hearing more about the work the government is doing in the north through the northern Ontario heritage fund. You said earlier that the fund is one of four major program areas for the northern development and transportation division. How does the fund fit into the ministry and what is the ministry's role as far as the northern Ontario heritage fund is concerned?

Hon Miss Martel: The fund and the money of the corporation appear in our estimates under the northern development side. The fund was established by legislation in this House under the former government. That was for the Minister of Northern Development of the time to act as the Chair. A board of directors representing the people across the north is appointed through order in council by the government to sit and act as decision-makers with respect to proposals that come forward. There is no set limit in terms of the number of people who can sit on the board, although every effort has been made in the past, and that is what we continued when we did the reappointments in June, to ensure that every riding was at least represented by one member, if not two. That is not all of them, of course. There are 20, and given that there are 15 ridings, we have not doubled all the way across. But certainly we have had one per riding, and then we have native representation from other areas as well.

I think the board has an important role to play and it will have a more important role to play because we are undergoing now the terms of reference and criteria for a review of the heritage fund -- its funding, its criteria, its policies, etc -- that is mandated under the act. So at the fourth year, which we are coming into, this review has to go on.

There have been a number of suggestions made to the fund from other ministries, from various interest groups, that we should look at opportunities for other entrepreneurs as well. A major bit of work was done with respect to the service sector -- retail trade in particular, which is an area we have steered clear of to this point -- which suggests the need for us to become involved with that particular sector. So the new board members will be asked to look at some of the work that has already been done, some of the recommendations that have flowed from the retail service sector, to see whether there is a way we can accommodate those concerns or whether we think it is appropriate that we try to accommodate those concerns.

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As well, there are certainly areas in the public sector where people have made representation to say there should be things covered that are more public sector versus private as well. Again we do not want to cut off any debate. The board members will be asked to review these kinds of matters and make some decisions about where we want to head. I think in the next number of months we will have a fairly significant opportunity to review what we have and where we have spent money, what our role and mandate is and, given the numbers of groups that have come before us and asked to be a part of this process, what we think we can accommodate and what we think we cannot accommodate.

It is certainly a process I am looking forward to. I think there are some changes we can make that might provide some more assistance for people in northern Ontario, not only for those who are struggling to continue to survive, but for others who are quite interested in expanding and need some form of assistance from the province either because they cannot get it from the bank or they cannot get enough.

Mr Wood: Some people were very critical of your recent announcement in the House on what the fund was able to do in Atikokan. I wonder what your response is to this criticism. Is it considered just to be another bailout, as some of the comments and criticism have made remarks on?

Hon Miss Martel: Thanks, Len. Let's go back to the history in Atikokan. When we were there in February, both the sawmill, which was owned by Buchanan, and the Proboard facility, which had American owners at that time, were down. There was a little over 80% unemployment in the community at that particular time, and we tried as best we could through anti-recession measures, because that was before we had announced the anti-recession package, to move some projects, particularly to Atikokan, to get some of those people back and to allow for the purchase of goods and services.

We then began dealing directly with the sawmill itself, because there had been a request for financial assistance and also assistance to look for a possible new product line. Earlier this year we were able to help that particular facility to get back on track. We worked very closely with the labour groups, which had a concern to ensure that the money we flowed to that particular division would remain in the community, and we gave an undertaking and provided assurances that the money we would flow would go to that mill and to no other and would help the local employment there.

That mill was up and running again by May and has continued to operate. The owner there was in Europe some weeks ago making efforts to show his product to the Europeans in order to attract a new market. I do not know of his success or lack of, either way, but certainly he is making efforts now to try and have a broader distribution of his product line.

The second important thing was the funding at Proboard. The American parent had been trying to sell the particular facility for some time. The general manager at the plant had expressed an interest in buying it and maintaining the Canadian ownership of it. What they were needing again was financial assistance to get the thing up and running. They have to do some work in terms of finding new markets, but their importance is that they take some of the waste product that is produced at the sawmill and use it in their own facility. The importance is not only in terms of employment levels increasing again but certainly in securing the future of the sawmill, because the second mill uses their product, so there is somewhere to sell.

In terms of the second announcement, that put about 322 people back to work directly and indirectly. In a community of that size in northwestern Ontario that has been significantly hit in the last number of months, I think that was pretty significant.

I go back to the reason why I think we have used the fund in a most appropriate way. It goes back to a major discussion the board members had some time ago that I mentioned earlier, when we began to see how hard the recession was upon us and what kind of trouble that was creating in northern Ontario. The board has made a major decision that was agreed to by everyone around the table.

We have a responsibility not only to new enterprises that are getting up and running but also to enterprises that are already operating in order to secure that employment, particularly in communities where that is the single source of employment or a major employer. The board members had absolutely no hesitation in providing that funding. I certainly think it stabilized that community in a way it never expected. They were certain that neither would ever open again in the community. We have provided for all the jobs. Everyone is back at work. The employers in both operations are looking for new markets, and we think we have a very important success story there.

Mr Wood: As you had mentioned at your earlier statement's beginning, the forest products industry in northern Ontario had been hard hit by a variety of federal government policies, among them the high value of the Canadian dollar, the gruelling interest rates and the softwood lumber export tax. You have told us a bit about what your ministry has been able to do to assist stricken sawmill communities. We just went through one of them. I would like to hear more details about this.

Hon Miss Martel: There are two levels. I will deal with the sawmills and pulp and paper. The work we have been doing in the sawmills started about last March. We had been approached by a number of groups, and the former Minister of Northern Development as well, at a meeting in Hearst to try and provide some assistance particularly to the small local sawmillers. These are people whose family operations have gone on for years through difficult times. They are the last people to leave the community. They are the last people to pull out when everyone else has. They were really feeling hit by a number of factors, all of which you have outlined.

We put together a package which has been targeted at helping the communities that have been affected. We have helped about 12 at this point in time in a variety of ways, most notably in almost every case by going to the bank with them and negotiating a further line of credit or increased credit from the bank to the particular corporation. That is where we have had the most success. So we have, with our money and in going to the bank, levered increased funds from the bank in order to allow these operations to continue. The money was flowed both through the heritage boards and through the Treasury. The Treasurer has a pool of money set aside for regional economic development and we tapped that pool in this case.

We think we have been very successful -- some 12 communities, hundreds of jobs in the last number of months that we have been able to help save. All of those save for one have continued to operate with a great deal of success. The one we are now having a problem with, we have again suggested we will provide whatever assistance we can, but there are some other details which I will not go into with respect to that particular situation.

Let me make one other comment. A number of ministers, not only myself but particularly the Minister of Natural Resources and the Minister of Industry, Trade and Technology, have grown very worried in the last month over the state of the pulp and paper industry in northern Ontario. It is an area where major restructuring has not yet occurred and is probably before us. We have grown very concerned about their problems, with respect not only to monetary policies but also to the major question of recycling and the need for recycled content and the fact that none of them has recycled content now and would have to make a major expenditure in order to bring that on line.

About three weeks ago the Minister of Natural Resources co-ordinated a meeting between a number of representatives from the forestry industry: small sawmill operations, pulp and paper, people involved in waferboard, both of the unions that are involved, the Canadian Paperworkers Union and International Woodworkers of America, and a number of ministers. We had a very frank discussion about the need to work together if we are going to avert the kind of disaster that some of us are fearing right about now.

We had a commitment from all the people who were there, from the business community in particular, that they were prepared to work with the government to set up a series of ongoing meetings as quickly as possible to see what can be done. Certainly this is an area that we will be watching during this winter because, as I said before, it is an area where some of the major restructuring has not occurred yet and where some of it may well occur this winter. That restructuring will come one way or the other, but we will do everything we can to try and manage it in the best way possible.

Mr Wood: You recently announced SCAN North, a program which has been touted as an important part of the government strategy for the north. I have a two-part question. I am wondering why this announcement was made up north in Sudbury and not in the Legislature.

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Hon Miss Martel: Most members will recall that the former government had in place what they called northern development councils, nine councils established around the north to provide input and advice to the government of the day on northern issues. When I became minister we spent a great deal of time visiting the councils. I met with as many as I could personally and Andrea Valentini, my assistant in Sudbury, met with the rest of the councils to talk to them very directly about what their experience had been as a council, what had worked, what had not worked, if they felt the process was adequate and if they felt empowered or not.

We came away after dealing with all of those and with the chairpeople of the committees on two different occasions, with the view that they liked working with each other, they enjoyed the experience, but they were not quite certain whether they had empowerment. While they sent a lot of resolutions to Queen's Park during the course of their three years, they did not have a definite sense that answers were provided or they were listened to. They stressed to us the importance of empowering people to give life to some of the projects they had consistently mailed to Queen's Park in terms of possibilities.

Our project SCAN North is a replacement for those councils, and the funding set aside for that program has been moved over to deal with this particular project. We think it is different because we have targeted particular areas of concerns that not only the northern development council memebers raised with us but that have been raised with us within the ministry or by other ministries or by other interest groups in the course of the last year I have been travelling about the north.

We are particularly interested in getting the two on value added in the forestry industry and mining industry up and running as soon as possible because we believe there are some opportunities there. We have received confirmation from all the players both on a business and labour front, and they are quite prepared to participate. We have written to all those heads of organizations to ask them to appoint people and the letters went out last week. We will be selecting the co-chairs this week as well.

Again, those are the only five we have noted. We believe there will be opportunities for other people who have ideas and suggestions about particular projects or ideas they want to bring to us that we would look to funding. We are quite convinced that a number of members of the northern development councils who brought their expertise to the table under the former program can in fact bring their expertise here. We hope to get at least the first two I mentioned up and running before Christmas, because we think it is an important role that has to be played in terms of a longer-term strategy and we really would like to get them moving as soon as we can.

The Chair: If I might move in rotation now to Mr Brown.

Mr Brown: We have not dealt yet with the anti-recession program in our questions. The first question I would like to ask the minister is, in light of the Treasurer's announcement some six weeks ago of a cut in capital expenditures in this province, and in light of the Treasurer's statement today of a further cut in capital expenditures in this province which would very closely approximate the $700 million in anti-recession money, how much of the cuts the Treasurer has announced today and six weeks ago in terms of capital expenditure reflect on the north? How many dollars worth of projects this year that were in the capital expenditure program of the spring of 1991 are not being proceeded with?

Hon Miss Martel: I can only speak to the anti-recession program and tell you that 80% of ours will proceed.

Mr Brown: I am not talking about the anti-recession fund. I am talking about approximately $700 million of capital expenditure cuts the Treasurer made across ministries. How much of that would have been spent in northern Ontario?

Hon Miss Martel: I can only speak to our own estimates. I cannot speak to any other ministry because I do not have that information.

Mr Brown: Could that be provided?

The Chair: First of all, for clarification, the question has been placed routinely to each of the ministries. Perhaps the staff members could indicate their ability to draw the numbers being requested from within the ministry and those other numbers which might be accessible from other ministries.

Hon Miss Martel: Do you wish Sheila to respond?

The Chair: Sheila Willis, please identify yourself.

Ms Willis: Sheila Willis, assistant deputy minister, corporate services: Of our original $41.5 million allocated under the anti-recession program, $1.1 million will not be proceeded with, and that is for the new Slate Falls hydro project. It simply could not get off the mark and get going in this fiscal year. That is the only project we were planning to undertake that will not be proceeded with this year.

Mr Brown: You are speaking directly of the approximately $41 million that is within this ministry's budget, not the approximately $160 million in other ministries' budgets that you say is being spent in northern Ontario?

Ms Willis: That is correct. We could obtain the information from Treasury about other ministry projects if you want us to get that. We could get back to you with it.

Mr Brown: I would appreciate that. I am sure all members would, if that is possible.

Ms Willis: We can do that.

Mr Brown: Regarding the anti-recession program, which I might add is much appreciated in many communities across northern Ontario, and I am not trying to suggest otherwise, we are concerned with the targeting of the program and whether it actually went where the need was the greatest in terms of job creation. Could you comment on that? How was your selection process related to unemployment numbers, growth and welfare rates, etc, so that the money that was spent was spent where it needed to be spent the most? It was needed all over the place, and I understand that, but there had to be areas of greater need.

Hon Miss Martel: We made every effort to take a look at the unemployment rates in the areas we were targeting. The ministry staff in each of the regional offices were asked, and then it was broken down into the offices in the communities, what particular projects the communities had identified. We wanted to be sure there would be something we could do in those communities once we had identified them as high-priority areas.

Certainly if you take a look at the overall amount of money that was flowed, you would see that in Sudbury and in Nickel Belt significantly less money was flowed. That came directly as a result that we were much more buoyant during this particular winter than were other communities. I see Mike Barker has a set of papers in front of him. If I just might grab it, it might give me the actual details. I have the figures by riding, Mr Brown.

Mr Brown: I am not certain we are as concerned by riding as we are by region, but it is fine if that is how you want to do it. For example, in my riding, the greatest need is obviously in the Elliot Lake area. This borders the Algoma riding and would not necessarily be reflected just in my riding statistics or Algoma's statistics.

Hon Miss Martel: I have the list of riding summaries to November 1 for anti-recession, which I can provide to all the committee members if they want to have it. I can tell you, just in looking through them, that my riding received the lowest amount of money. Please do not tell my constituents that. Then the Treasurer's were next. That was based on the fact that, frankly, we were fairly well buffeted, although not as well as we could be. But we did fairly well in terms of maintaining our employment during some very difficult times.

Areas that suffered significant problems, for example, yours, Mike: almost $4.1 million in anti-recession moneyI can run down the whole list if you want.

Mr Brown: I would just appreciate the information. I do not it is necessary.

Hon Miss Martel: As I said, for example, in Atikokan we gave particular concern and particular priority to that community, because we were there before our list had been created. We were in a position to understand that a good portion of the community had been affected and was laid off. We moved a significant number of projects into Atikokan to respond directly to those people who had been laid off.

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Mr Brown: I understand the money you are talking about is your ministry's money, not the total fund.

Hon Miss Martel: Yes.

Mr Miclash: We are talking about anti-recession funds. I think I have run this by you on other occasions. As Mr Brown indicated earlier, we are always happy to see these funds come into the area. I know I have been told a number of times that the funds are there to create jobs and stimulate the Ontario economy. My main concern is the stimulation of the Manitoba economy. We have had a good amount of anti-recession funds flowing out of the province to contractors in Manitoba. I guess what I am looking for right now are your views on that and whether there are any stipulations in terms of the use of local labour and local materials, something we always look for in terms of stimulating the economy of our various areas.

Hon Miss Martel: There were no directives -- that is the best word to use -- forwarded to all the municipalities to tell them that under every circumstance they had to use an Ontario contractor, that X and Y amount of people had to be hired and that the goods and services had to be purchased locally. We felt the communities would understand that on their own, because it was them we were trying to help with our programming. It was certainly people in their communities who were unemployed and businesses in their communities that would need the purchase of goods and services. It was made very clear to all of them that the point of the fund itself was to stimulate purchase of goods and services and employment in their local communities. We left it to them to make the best arrangements they could, based on trying to provide for that and also trying to make sure they got the best possible value for money.

If I go back to the issue that has been raised between us, which is the case of Ignace, it is quite correct that it was a contractor in Manitoba who got that contract. It was also very true that the municipality looked at all the contractors, asked them what they could provide, and the contractor from Manitoba could guarantee the best in terms of purchase of goods and services and the best local employment. I would be very hard-pressed as the Minister of Northern Development to tell the town of Ignace that it had to hire an Ontario contractor who was going to provide less in terms of local employment and local stimulation than the contractor in Manitoba. So I felt, after reviewing the situation in Ignace, that the community had made the right decision. They had chosen someone who was going to give them the best possible bang for their buck locally.

I think you have to look at it on a case-by-case basis. I would not want to give a blanket provision or a blanket directive to these people to say, "You have to hire Ontario contractors," when in fact, as we saw in Ignace, the better deal was given by someone from outside.

Mr Miclash: Who follows up to ensure that those jobs were created in the community and that the materials were actually purchased in the community? Is there any follow-up done on that?

Hon Miss Martel: The ministry tracks the level of employment that is being created. I am not sure we track where the purchase of goods and services was. Perhaps there is a staff person who can help me on this. Does anyone know? Mike?

Mr Barker: I doubt they would track that, although with each project there is a set of terms and conditions that must be followed. I am afraid I do not have a copy of the terms and conditions. They may vary slightly from community to community. I am not sure there was a standard condition in those that requires the tracking of that information. We can certainly check it.

The Chair: For the record, "Mike" is Mike Barker and he is the assistant deputy minister of the northern development and transportation division.

Hon Miss Martel: The information we have is that the ministry must report to the Treasury on the jobs that have been created, and I understand we are doing that on a quarterly basis in person-years.

Mr Miclash: So those statistics would be available.

Hon Miss Martel: Yes, but that is just on the employment side. You have asked for the purchase of goods and services and I do not think we can provide that for you. I think we would have to go back to the local communities and ask them directly.

Mr Brown: We are concerned a little bit with the relocation program the government is presently involved in. We are concerned that the moves may not be happening as quickly as possible. Certainly the communities affected and looking for those jobs want the reassurance that everything is moving along as quickly as possible. I think of your ministry and the Ontario geological survey moving to Sudbury. I think of the Ministry of Natural Resources and its move to Haileybury. I think of the Ministry of Transportation and its move to Elliot Lake. I would just like assurances that these programs are moving as expeditiously as possible.

Hon Ms Martel: The move to Sudbury is proceeding on schedule. You will know that there had been money we gave back to the Treasurer in this fiscal year which touched on the mines and minerals research centre. It was money with regard to the purchase of equipment, which we felt we could leave to the next fiscal year, but we have gone through this again and all the people will all move. The building is on schedule and we expect to have people actually starting to move early in the fiscal year, in February or March, if I am correct, with almost the full complement in there by July.

With respect to the Haileybury and Elliot Lake relocations, I have written in support of Haileybury in particular, because the community has lobbied me several times. I very much understand their desire to have this go as quickly as possible. If there are any problems, I cannot tell you what they might be. I can only say that as a member who sits at the cabinet table, it is my understanding all the relocations will proceed. If there are any particular problems within various ministries in making arrangements to have that done, I cannot speak to that. I can only speak to ours, and ours is going ahead.

Mr Brown: As the so-called designated hitter in cabinet for northern concerns, I hope you would use all your influence to make sure the Haileybury and Elliot Lake moves proceed quickly, because these are both communities that really need those jobs and need them quickly.

At this time does the government plan further relocations to northern Ontario? As you know, what we have actually been talking about is the former government's program, not your program. Do you have a program for relocations to the north? Are you anticipating one? If so, when can we expect announcements?

Hon Ms Martel: I would say the magnitude of the relocations that will have to take place over the next two years is very great. The government has no plans at this point to announce even more when we have a number on our plate that must be completed. I can say to you that there has been no discussion at any table about looking for new designations, new areas of the government that may be able to move. That is not to say there may not be changes in terms of health care professionals and other people whom the government indirectly funds who may move, or changes in that regard. But strictly on ministries, I would say there are no plans for any further moves over and above the ones we committed to in the throne speech.

Mr Brown: Would you be supportive of more moves?

Hon Miss Martel: Only if they come to Sudbury? No.

Mr Brown: Strike that.

Hon Miss Martel: Let me just speak in a personal way. As a beneficiary of a relocation, the move has been very good for our community. It has provided a tremendous boost in the downtown area. I think the people around the table who have moved would agree that it has worked out well.

Mr Brown: We see a lot of happy faces.

Hon Miss Martel: Not everyone moved. People made their choices, and people will make their choices with respect to the moves in mines and minerals. I certainly say, as a recipient of a move into my community, it has been a tremendous benefit and I would be hard pressed not to support other moves that are reasonable and can be managed, because of the benefits I have seen in my own community.

Mr Brown: Shifting gears again slightly, the Gore Bay fish hatchery was the beneficiary of some money from your ministry. I applaud that. I would just like to know whether you intend to continue to fund the Gore Bay fish hatchery, out of what program it is funded, if it is available to other communities and what the criteria are for that program.

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Hon Miss Martel: It is one we have done without really a program in place to do it. We had a concern because of its high tourism value and its high potential for employment on Manitoulin Island. I would be hard pressed not to acknowledge its significance and therefore provide some funding in order to keep it going.

Whether or not we would provide funding over the long term, I would say that we have approached the Ministry of Natural Resources again, because we hope this would be something it would pick up and then look at the other cases that are out there -- and I know there are others -- in terms of funding.

At this point in time, those negotiations are not terribly positive. However, we continue to try and deal with that. We do not have a particular program I am aware of specifically for fish hatcheries that other people could apply to. It was very much a decision by myself and staff based on the importance of this, particularly for tourism and particularly on the island, and that is why we did it.

Mr Brown: The difficulty though is that it might be important this year; it is also important next year. Gore Bay is not the only community in that position. There are a number across northern Ontario and I dare say in other areas of the province that are in the same position. I urge you to do this. I have spoken directly with the Minister of Natural Resources, as have the people of Manitoulin who are responsible for this project, and he is not very encouraging. I guess the ball is in your court, if I understand Mr Wildman.

Hon Miss Martel: It may be in our court at this point. Certainly we did it in the first year, and I think we gave an indication -- I do not have a copy of the letter in front of me -- to the particular organization that we would do it this year but we would make every effort to try and convince MNR to undertake it on an ongoing basis. Where that will lead to I am just not sure.

As I said earlier, and I hate to go back and harp on this, I do not know that there will be many new programs in any of our ministries this year. I suspect there will be very few and we will be trying to hold the line on what we have. Therefore I would be very reluctant to give any kind of undertaking to the member here and now to say that we would fund it on an ongoing basis or to say that we would be developing a program to do that. I do not think it would be fair to do that, because that may not be what we end up doing, in all honesty.

Mr Brown: Just quickly, could I have from the ministry an idea of how much money was actually disbursed to the Gore Bay fish hatchery at the completion of this fiscal year?

Hon Miss Martel: We think it was $40,000, but we will get those.

Mr Brown: What I am asking is not for you to give me an answer right now but to tell me as of March 31 how much actually flowed.

The Chair: The fiscal year?

Mr Brown: Yes.

The Chair: Thank you, Mr Brown. They have undertaken to get you that information. Mr Eves.

Mr Eves: I just have a few other questions. I do not believe I received a response to one question I have asked a couple of times, and that is, is it your intention to deliver on the commitment in An Agenda for People to $100 million a year in four-laning the Trans-Canada Highway?

Hon Miss Martel: I thought I did.

Interjection: No.

Hon Miss Martel: Sorry, I thought I made it clear that we had money to deal with the $200 million which I committed out of the $400 million over two years, but certainly we have not put $100 million into this fiscal year and I do not see where we would be in a position to do that.

Mr Eves: Do you have any idea of the current employment or unemployment rate, as the case may be, in northern Ontario?

Hon Miss Martel: Yes. Just bear with me for one moment. I am going back to the questions we tabled this morning. The question as to that was raised by Mr Brown. I am reading directly our response:

"The current situation is worse than last year in terms of unemployment and increases in the number of general welfare cases. The northern Ontario unemployment figure for October 1991 is 10.2% compared to 7.4% for October of 1990. Comparable figures for Ontario as a whole are 9% and 6.4%. The value for the north region general welfare case load is 17,309 for August 1991. This is a 40% increase over August 1990."

In 1990 the case load was 12,361.

Mr Eves: With respect to capital allocations for northern hospitals, would your ministry have any idea of what those dollar figures would be, or are they obtainable only from the Ministry of Health?

Hon Miss Martel: I think we could only give you EldCap beds and nursing stations, not hospitals. I think they would have to be obtained through the Ministry of Health.

Mr Eves: Speaking of EldCap, where are we at with that program now?

Hon Miss Martel: In light of the changes that came as a result of the long-term care paper, we have done two things. We have said very clearly to those communities that had a letter from either the former minister or the deputy stating we would be providing EldCap beds, extended care beds. Those commitments will be made by our ministry, because we do not think it would be fair right now to change those in some way when people definitely thought they were buying into and receiving beds.

We have said though that new requests that come on stream will be reviewed in light of the government's commitment to the long-term care policy and our efforts to try and push community-based care, so the need may not be strictly for beds but community services instead. We would try to be more flexible in terms of that funding, to fall in line with what we are trying to do in long-term care and try to respond to the needs in the community based on our view and our hope to have more community-based services provided.

Mr Eves: Maybe you have already done this. Could the minister give an accounting of the $5 million that was provided for Algoma Central Railway, or at least the commitment that was made?

Hon Miss Martel: Yes. Through the heritage fund we provided $5 million to ACR last year. That announcement was made by both my colleagues. Bud Wildman and Tony were both in the Sault to make that announcement. At the time, we stated very clearly that we would like to enter into some negotiations with ACR through the Ontario Northland Transportation Commission to determine its future and ours and what it might look like.

The negotiations began, but as you can imagine, they did not go for very long, given what happened soon thereafter in terms of Algoma Steel Corp. Certainly the future of Algoma Steel Corp, Wawa and the jobs is very much tied up with the future of what the ACR will be. At this point in time we have not had very much in the way of ongoing negotiations because we have all been involved in what is going on at Algoma Steel, so I cannot say to you where we will end up at the end of the day.

Certainly we are committed to keeping that railway going at this time because of the employment it provides, not only in Wawa but right up to Hearst, with the movement of goods and services along that railway. Again, we hope that once we have sorted out what will happen at Algoma Steel, we will be in a better position to understand what the long-term future of ACR will be as well.

Mr Eves: What is taking place with the TEMFund?

Hon Miss Martel: The TEMFund is administered under the auspices of the Northern Ontario Heritage Fund Corp. I will ask Arne to give you the figures of the disbursements to date, but certainly all the programs that are approved come back to the heritage board for approval, because we disburse the funds on behalf of that particular fund.

I would ask Mr Sorensen if he might have with him information with respect to the disbursements to date from that fund.

Mr Sorensen: I know where to set them down.

The Chair: You can co-ordinate the microphone too, I'll bet. Now that you are completely at ease, please proceed.

Mr Sorensen: I am Arne Sorensen, general manager of the Northern Ontario Heritage Fund Corp. TEMFund, as the minister mentioned, is a fund that was created as a result of a donation by Dofasco when it closed the Sherman and Adams mines in the district of Timiskaming.

The provision of the donation was that the funds were to be directed towards economic development through the private sector. The $4 million was donated to the Northern Ontario Heritage Fund Corp and is administered by it. However, there is a board that has been appointed locally in the district of Timiskaming. It is made up of the representatives of the various communities -- Kirkland Lake, New Liskeard, Haileybury, Earlton and Temagami.

The applications are received by our office and evaluations are undertaken on our behalf by the Northern Ontario Development Corp from the point of view of the economy and efficiency. To date, there has been $1.4 million in assistance committed. That has levered $9.2 million in total investments, for 16 projects and 230 jobs.

Mr Eves: There would appear to be a funding decrease in the Ontario Northland Transportation Commission rail and ferry services. Is there a reason for that?

The Chair: Would you like to call on someone from the ministry?

Hon Miss Martel: We have two choices. We could answer this now for you, or Peter Dyment is in Toronto and is prepared to come tomorrow if there are specific questions on ONTC. If you have other questions on that commission, would you like to defer them until tomorrow when he is here?

Mr Eves: As long as I can get the information. Unfortunately, I will be in Quebec City tomorrow.

The Chair: On business with the committee.

Mr Eves: With the select committee on Ontario in Confederation.

Hon Miss Martel: Then we will give you that answer now.

The Chair: This is Michael Irvine, director of financial services. I have to keep all the Mikes straight.

Mr Irvine: The reduction in the estimates for 1991-92 for the ONTC relates to a request we had at Management Board for funding the night train. Management Board requested us to identify funding as an offset this year. As the committee knows, the night train is not being proceeded with, so that funding has been removed, but the $1.2 million was related to that particular expenditure.

Hon Miss Martel: Can I respond on a political level? I do not expect the staff to do that.

We had entered into negotiations with the former government to try to gain some assistance from it in order to reinstitute the night train. Both the former and the current Minister of Transportation and I wrote to our federal counterparts and asked them if they would be prepared to participate by giving us some assistance in order to operate that, because it would be quite a substantial subsidy for us.

We most recently received a negative response to that, and because it did not look like we could proceed, we gave that money back to the Treasury as part of the restraint package.

Mr Eves: I wondered if the ministry has been contacted with respect to abandoned railway lines and particular bridges that groups in different communities -- there are a couple here, Elk Lake, New Liskeard, and a group known as Northern Community Advocates for Resource Equity are asking both levels of government, because it involves both levels of government, to try to resolve this conflict. I wondered if your ministry has been brought into this set of problems and, if so, what your reaction towards these requests were.

Hon Miss Martel: I have not directly, but it does look like Mike Barker has had some discussions on this, so if you would not mind, I will ask him to respond.

Mr Eves: Another Mike.

Mr Barker: An earlier Mike. NorthCARE has indeed been in touch with us on this and we are going to look into it to make sure we see what can be done to retain the access the people are concerned about. The matter has not been resolved at this time, but we certainly hope it will be.

Mr Eves: To be fair, it is a complicated matter and it does involve both levels of government and the railways, etc. But in the three or four communities where they have talked to me about it, it would be a real shame to see those bridges torn down. It would be a real loss to those communities.

Mr Chairman, I do not have any further questions at this point in time. Perhaps some other committee members have some they would like to ask.

The Chair: We also have the option to adjourn early. If I am not seeing any nibbles, then I will entertain a motion to adjourn.

Mr Lessard: So moved.

The Chair: This committee stands adjourned until following routine proceedings or 3:30 tomorrow, at which time we will complete estimates for the Ministry of Northern Development and Mines. We have approximately two hours and 40 minutes remaining.

The committee adjourned at 1755.