CONTENTS
Thursday 20 December 1990
Organization
Continued in camera
STANDING COMMITTEE ON FINANCE AND ECONOMIC AFFAIRS
Chair: Wiseman, Jim (Durham West NDP)
Vice-Chair: Hansen, Ron (Lincoln NDP)
Christopherson, David (Hamilton Centre NDP)
Jamison, Norm (Norfolk NDP)
Kwinter, Monte (Wilson Heights L)
Phillips, Gerry (Scarborough-Agincourt L)
Sterling, Norman W. (Carleton PC)
Stockwell, Chris (Etobicoke West PC)
Sullivan, Barbara (Halton Centre L)
Sutherland, Kimble (Oxford NDP)
Ward, Brad (Brantford NDP)
Ward, Margery (Don Mills NDP)
Clerk: Decker, Todd
Staff:
Anderson, Anne, Research Officer, Legislative Research Service
Rampersad, David, Research Officer, Legislative Research Service
The committee met at 1008 in committee room 1.
ORGANIZATION
The Chair: The first item on the agenda is a briefing by Anne on the pre-budgetary consultations and some of those forecasters.
Ms Anderson: I circulated a memo which I hope you all have. It has some attachments of the witnesses who came in previous years. As well as talking about the witnesses, I thought I would briefly broaden that a little into more what happened before and afterwards, just to facilitate the discussion about witnesses.
On each of the four occasions it has happened in the past, the pre-budget consultations have begun with a background briefing by the Ministry of Treasury and Economics, looking at economic forecasts of things like growth in the future, both in the immediate year and in the medium term, unemployment, housing starts and other economic variables. As well, they have talked about the fiscal review for the last year, things like the distribution of revenue and expenses, how it has changed for different sectors, the debt situation, stuff like that.
Those briefings have taken anywhere between one and three days, depending on the questions in the committee. They have been based on this book, which was tabled in the past, called Economic Outlook and Fiscal Review. Previously it was tabled in about November and December each year. I understand that it is unlikely there will be one this year, but that the core information from it is contained in the booklet that was tabled by the Treasurer in December, called Ontario's Economic Outlook; the basic information is in there.
Last year, because the economy was starting to go into a downturn, the committee decided it would also like to hear from experts outside the government as well as inside; so it invited several economic forecasters from different organizations to come. Most of them were able to; there were one or two conflicts and they could not, so we ended up with five different experts, people from the C.D. Howe Institute, Wharton Econometric Forecasting Association, Data Resources Canada, and a couple of the banks came as well, to give a sort of background macro look at the economy and what they felt was going to happen in the future and what sort of actions they felt could be taken by government to work with that.
After the briefing from the ministry, they went straight into public hearings. I have attached a list in exhibit 1 of the witnesses who have appeared in front of the committee for the last three years. I would like to make a couple of points about those. If you look at the number of people who came and made oral presentations, there are usually about 40 groups that appear before the committee. The committee often allocates about half an hour per group for both the presentation and questions. If you assume that the committee meets from, say, 10 to 12 and 2 to 5 each day, which is five hours, you can hear 10 groups in a day; so to hear 40 groups you could, if you wanted to, do it in four days of hearings. It is intensive but it is feasible to do that.
The other point I would like to make is to talk about the distribution of the groups across different sectors, because it is quite uneven. There has been a much stronger emphasis of groups from the education field, housing and people talking about the Social Assistance Review Committee report, and very little representation from, say, manufacturing or the auto sector, from retail, from business and industrial groups, financial services. That has a bearing when you come to write the report because of varying representation from members of the public. Sometimes, too, you can get representation from one group of an industry which does not necessarily give the committee enough information about the whole industry. For example, one year the only representation from agriculture was the beekeepers. It makes it more difficult to talk about agriculture when you have one.
The Chair: In the past, in order to get a more balanced view, has the committee invited different people to come and make presentations?
Ms Anderson: It has not done that, but that may be feasible. When you see the list of people who have requested presentations and you find that there are omissions in key areas, I think the committee could certainly decide, if that is what it wants to do, to invite other members.
The second exhibit also gives, briefly, the kind of issues that were looked at. It makes the same point, really, that it is an uneven distribution.
If the committee requests it, research often provides a compilation or summary of all the recommendations that come from witnesses. I have given you an example of last year's so you can see it. It is pulled together by different issues, so we can get all the recommendations people have made about housing in one place and all about education in one place. That sometimes can be helpful when you are going through the report-writing process, to pull it together. We try to do that pretty much on a daily basis so that as soon as the hearings are finished it will be available for committee members.
I do not know whether you want to go into the reportwriting process at this point or whether you would like to wait for that.
The Chair: I think what would be useful is what we discussed that afternoon just after the subcommittee met, about time frame, about how you view the process and what would be best for you and what would make the best report possible.
Ms Anderson: In report writing, what tends to happen is that after the hearings are finished, the committee meets briefly and decides on an outline, the structure of the report, and gives directions to research of the kinds of things they would like to see in the report. Ideally, it is helpful if some of the kinds of recommendations you are interested in are also discussed then. That does not tend to happen very frequently, but it makes it easier to write the arguments for them when we do that.
Then there are a few days in which we draft a report according to the outline you have suggested. We would come back to you with an outline, with the text of the report but without recommendations. The committee goes over the text and then works out its recommendations, and we revise the text according to the recommendations, and it goes back and forth until either we run out of time or you are satisfied with what comes out at the end.
The report can be structured in a couple of ways. It seems to me that one way is to look at the big, overall issues, and another is to look at all the little issues that all the witnesses have brought up. That is something to bear in mind as we go through the hearings, what kind of focus the report could take. I think that is basically it.
The Chair: How much time do you need to write this? You made mention at the subcommittee hearing that sometimes it is due on the Monday after the Friday. What amount of time would give you the best opportunity to write a good report?
Ms Anderson: It is helpful to have several days from the time the committee has given its directions to producing the first draft. It gives us time to put everything together and it gives the committee time, too, to deliberate. There have been occasions when it comes out the day the hearings are finished; that makes it more complicated. If we can have a few days between, that would be helpful.
Mr Kwinter: I want to thank you for that overview and tell you that you have just highlighted the problem that Mr Sterling and others have identified and the great discussion we had the last time we met.
You really have to decide what the role of this committee is. If you take a look at the list of witnesses, you have a situation where one group is the Hockey Development Centre for Ontario; I have not looked through it that carefully, but it is probably the only one representing the recreational aspects of the economy. As it was pointed out, when it comes to agriculture you have the beekeepers. When you have almost an ad hoc list of witnesses, you are really bound by what they tell you. This committee reports based on the people who have come forward. If you have a very restricted or very narrow group of people, your report is going to be very restricted and very narrow. For it to be taken seriously by the Treasurer or anyone else presents a difficulty. Because one particular special interest -- I do not use that in a negative sense, but it is a special interest -- comes and puts forward its point of view and that is the only point of view we hear, we have to comment on it, it has to be included in the report -- "These people came; here is what they said" -- and the uninformed or the person who does not understand the process could assume that this is what this committee is putting forward, even though it is just reflecting what has been presented to it.
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That was why there was a feeling that if we had some way of structuring, maybe the sectors in the economy that impact on the budget -- I did not get a chance to speak yesterday on interim supply. I was all geared to go but it kept going on and on and I had other obligations. But let's face it; there is very little in the way of flexibility for the Treasurer. There is a misconception people have that the Treasurer sits down and in his wisdom dispenses this $45-billion budget. It just does not work that way. With all due respect to all of us, there is no one here who has that capability, including the present, the past or any Treasurer.
What happens is that the Treasury people come forward and say, "We expect the revenues of the year to be X." It may be $45 billion. Where they got into trouble this year, and it is something you cannot fault them for, is that their expectations were too high. They did not anticipate and no one anticipated that the economy was going to get as depressed as it is. So their revenues are not what they expected. Generally, they say: "Here is what your revenues are. We think all the corporation tax, the transfer payments, the personal income tax, the sales tax, all of these things are going to generate $45 billion. Now here is what you must spend."
You have no choice unless you decide you are going to shut down the schools, the hospitals, all of these things; and without being partisan -- who knows? -- you may. If you do that you may be able to restructure the budget, but basically you are committed. I cannot believe you are going to shut down schools and hospitals and community and social services and all those things.
Then what happens is that you get $43 billion. I do not know the exact figure, but it is in that range. You get $42 billion or $43 billion that is committed. You have no choice, you cannot do anything about it, that is gone. You have to pay interest on your debt. The debt of the province is in the $40-billion range. You have to pay that.
Once all that is done, you now have some flexibility of maybe $3 billion, $4 billion, $5 billion tops. That is all you have any political control over. As a politician, you decide what you want to do with it. You can decide you are going to pay down some of the debt, as we did last year; we paid down nearly $500 million. You can decide you are going to balance the budget, which means you will only put in programs that do not exceed what you are going to take in. You can decide you want to prime the pump and want to run a deficit.
That is where the Treasurer has some leeway. He can sit down and say, "Based on what we as the Treasurer and the cabinet have decided, we are going to spend that kind of money." It seems to me that what we should be doing is addressing those sectors that can impact on that discretionary amount of money.
Let's face it. Again, without being partisan, the Treasurer is really hamstrung when it comes to what is happening in the hospitals. He has said that. He has a certain amount of money set aside for the hospitals and he cannot do too much about that, because right now it occupies fully one third of the total budget and if he puts that out of whack, everything else is impacted by it. It is not open-ended. It is not as if he has an endless amount of money that he can spend anywhere he wants to.
It would seem to me that our time would be better spent that way instead of just open-ended, where anyone who wants to can come and talk to us and we get a report that is going to be just a make-work program. It is not going to be terribly effective, because, again, with all due respect to the beekeepers, they do not have the total aspect of what is happening in the agricultural field; as a result, the agricultural sector is going to be sadly under-represented. Instead, we might want to invite some of the umbrella organizations of agriculture to come forward so they can give us the broad overview of what is happening to agriculture; or what is happening to the manufacturing sector, what is happening to education -- because they are a key user of money -- what is happening in the health field, what is happening in community and social services, all the social service agencies, the places where the government has some flexibility to spend that discretionary amount of the budget that is not committed.
Then we could be participating in a useful exercise. It may be too late this year but at least it would get us on the track where we were dealing with a major part of the people who are going to impact the economy. Once you get them covered, then of course you let anyone else who wants to come in; I am not trying to shut out anybody from coming. But if we get a balance so that at least the major players have a chance to make their views known, then it is almost like commentary by individual groups. The hockey association comes along and wants to talk about its particular issue and the firefighters want to talk about their particular issue, and you let them have that opportunity and there may be some interesting things that come out of it.
But if you cover the main sectors, I think it would be useful. As most of you are new to the process, you would get a pretty good overview of the economy of Ontario, where the pressures are, where the flashpoints are, where the areas are that really have to be addressed, because, quite frankly, everybody wants more money. There is nothing revolutionary about that. Every single person who comes forward will be putting forward his case as to why he should have more money. Politicians, being what they are, love to give money. One of the greatest things I loved to do as minister was give people money. It is great. Who is ever upset with you when you give them a cheque? The trick is, how do you not give somebody money? How do you say no to somebody who comes forward and has a very compelling case: "Hey, you know, we've only got so much and we can't give it to you." There has to be a system of prioritization, and in order to be able to prioritize you have to have information, a really solid overview of what is happening in the economy, where the danger points are, where the future concerns are going to be and what is going to be best to keep this province where it is now as the leading economic sector in this country.
Mr Phillips: If you are looking for input on how we would like to proceed, I guess the subcommittee will make the decision, or at least will recommend to us what it thinks.
The Chair: If I remember the motion passed last week, the subcommittee will decide on the first five days of hearings and then the committee as a whole will decide on the next process in the hearings.
Mr Phillips: What I would like to see are four or five groups the subcommittee would look at that would give us a kind of overview. Last year, I gather, it was the Ministry of Treasury and Economics and then a couple of banks and then a couple of think tanks. I think there should be a diversity. That would be helpful for me, if perhaps the first day we have the Ministry of Treasury and Economics and then three or four the subcommittee feels are thoughtful groups that can scope out their vision of what we face economically.
Then, as my colleague says, as you go down the budget, 51% of it is the ministries of Community and Social Services and Health. That is just reality. You can find in each of those probably about five umbrella groups that we would clearly want to come here to give us their visions. Then you get into the ministries of Education and Colleges and Universities, and there are another three or four groups. You get 90% of the budget represented by about six ministries, and I think the subcommittee can agree on who are the key players.
I would also not mind hearing your agenda, whoever is knowledgeable about how the agenda was put together, because it is what is going to drive us. In the back you have revenue forecasts and expenditure forecasts, and it may be very useful for all of us to know the basis on which that was arrived at. For me, at least, that would be another helpful background. As I say, this is going to be the agenda that will drive all of us over the next few years, so I would like to hear the basis on which that was arrived at.
I think it is also important for us not to look as if we are excluding people, so I am prepared to listen to fairly wide-ranging groups. I think there is a limit to it. Beekeepers may be important, as the subcommittee determines, but I think you will want, if we have more than we can handle, to make sure that people do not feel this Parliament or government is exclusionary. I do think we have to be a little careful, because we want a little thinking time as well. But I am prepared to listen to a fairly wide-ranging group, provided we have the overview, provided we have agreed on the key ones to come here. As I say, I think it is the diversity, because you are going to find in each sector quite a range of opinion; for example, between perhaps the nurses and the hospitals and the doctors. Each will have a different view of health care.
That is what I would like to see: Start with as broad an overview as we can with a good cross-section of opinion, then the key groups that have the key impact on the budget. Then, try and not be exclusionary. You may have to say to some groups, "We'll try and work you in, but we certainly want your written opinion that we will look at." I would like to have somebody who might just scope out for us the basis on which these were arrived at, because I think that will drive us very much.
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Mr Hansen: Taking a look at the past, 1988 and 1989, as Mr Kwinter has already mentioned invited witnesses, I have to go along with him. It looks like it was more successful in 1990 with the invited witnesses to participate, to give an idea of the economy.
On some of these other groups like the beekeepers -- we keep talking about the beekeepers -- I would say that if a group like the Ontario Federation of Agriculture wants to make a report and we have a long list and cannot fit everyone in, we ask the beekeepers to get involved with the OFA and include it in its report. I do not know if that has been done in the past. I think we still have to listen to everyone, but I think we can group them if there are too many on the list. Has this been an experience in the past where the list has been too long to hear everyone? It has been cut short? Okay. We will have to take a look this year. Because of the economy, there might be a lot more groups out there looking for funding.
Mr Sutherland: I just to want make the comment, looking at the list, that I agree with the sentiment that we need the overall, broad groups, the representative groups, but I would hope we might be able to invite a few individual groups. I see that last year you had a board of education, you had a specific university student union. I do not think I would necessarily want to hear from the same ones, but I would not mind possibly hearing from some different ones in the same area. I know what the broad overview is, but I would like to have one of the individual groups here to tell us so we can see what the direct impact is on their specific area. I think that would be beneficial to us as well.
Again, that may take a little urging from us to approach some groups. I do not know whether that is within our resources and ability to do that or whether recruiting specific individual groups is also a mandate that this committee has done in the past.
The Chair: I think we have the mandate to invite whomever the committee feels is important for us to invite. I do not think we are restricted in any way.
Mr Jamison: My personal opinion on how we should approach this -- do we invite or sit back and wait for presentations? -- is that we should really look at the umbrella groups out there. Just scanning the 1988, 1989, l990 invited groups, I think we probably could have done a better job and can do a better job; looking at the OFA, an explicit invitation to that group to make a presentation, because I think they are representative in an umbrella way; the various sectors, of course: the banking community, the labour community, people who really have a general point of view to represent. Those points of views may be diverse, but without having that input --
I think Mr Kwinter is correct in saying that we can accomplish much more than has been accomplished through committee in the past by looking at ensuring that those types of groups are here to make a presentation. That may mean the subcommittee has to go out of its way to get a cross-section of people together initially to make presentations to this committee. I agree that many of us are new here, and it will give us the ability to understand the concerns of the various sectors. But I think that is a crucial job that has to be done to allow us to function, because our function is to listen and report on what we hear to the Treasurer. That is as simple as I can put it. We should be looking at inviting a cross-section of presentations from the broad scope of the concerns that are out there.
Mr Christopherson: I do not have anything different to say with regard to who should to be invited. A lot of it is just common sense. We want to make sure there is a cross-section, that everybody has a chance, and look at it from all the perspectives that are expected in society today by the public.
The only thing I would comment on is, Mr Phillips mentioned having some research done vis-à-vis An Agenda for People. My concern with that is that I sense the potential for partisanship becoming involved in that kind of research. I have said it before: I intend to work very diligently to maintain some continuity and consistency in my approach that at the committee level we should try as much as possible to be non-partisan. Ultimately, it is going to be there, it is a reality. But I think that is a little problematic, for obvious reasons, and I think something needed to be said there.
I have no problem with everything else that was requested in terms of information. In fact, I look to the members opposite, having been here for a number of years, in many cases in leading cabinet roles, for their leadership in assisting us who are new in walking through this process and making sure we look at the appropriate things. The Treasurer, when he was here, indicated that he has a strong desire for more participation by members of the Legislature than there has been. I think that has to start right here with our group, and I sincerely look forward to the example and leadership that those in the opposition can provide. But I think it is incumbent on all of us to check each other when there are little indications that something is not quite consistent with that and more falls into the partisanship line.
I understand what the argument was and I know what the retort is going to be: that this is what is driving the government and therefore we should be looking at it. Quite frankly, I do not see it the same way. To take any party's platform and bring it to committee and say, "Now we're going to have this dissected by the various Treasury departments and people to find out where it came from" -- I would doubt very much if any Treasury people had any input, as we were not government. They were probably taken from reports that exist and projections that our caucus members were able to pull together. I suspect we may have a differing opinion on that. I hope we do not get too lost in it, but I am a little concerned.Other than that, I think the advice and suggestions of Mr Kwinter and Mr Phillips have been very well taken. My colleagues are expressing the kind of commonsense approach I am very supportive of and that I am sure the entire Legislature would appreciate.
Mr Kwinter: I want to respond to Mr Sutherland, who is not here at the moment. I just wanted to make sure there was no misconception. My feeling is that this should be as open-ended as possible. I have no objection to any individual group coming forward. My only concern is that I do not want them to drive the agenda. I want to make sure we have this broad overview and then supplement it by them. I do not want it to appear that our report goes forward and we are having someone make a presentation that is perceived to be all-encompassing for that particular sector when in fact they are a very narrow part. I have no problem at all with anybody at all coming forward and making presentations as long as we structure it in such a way that we get that broad overview as well and primarily.
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Mr B. Ward: That is the question I have. How are we going to decide which umbrella groups to invite to give presentations to this committee? Looking at the list of organizations and individuals that have been here in the past, I can think of some right off the top: the Ontario Chamber of Commerce is a natural, the Ontario Federation of Labour is a natural, and the Ontario Federation of Agriculture. Then you get some of the other groups like the Ontario Real Estate Association. Is it an umbrella group or does it fall under the chamber of commerce as a business group? Who is going to decide what umbrella groups we should be inviting? I agree that we should get a broad picture of what the business community thinks, what the labour community thinks, the direction Ontario should take next year and in future years and then invite the other special interest groups to get their specific concerns addressed to this committee. I am just wondering how we are going to decide who is an umbrella group and who should be a special interest group. Looking at the list, we could be tied up listening to umbrella groups in the short time we have as a committee here.
The Chair: I just did a quick inquiry. In the first five days, if we sit from 10 until 12 and then from 1 until 5, we have approximately five or six hours a day. At five days, that is 30 hours. If we gave each umbrella group one hour, which I understand is a lot of time, that would be 30 groups. Then we still have another week of hearings, another 30 hours of hearings, and then the possibility of another week travelling somewhere to listen to more hearings. I do not think we are going to be --
Mr B. Ward: There is no concern about a lack of time.
The Chair: We have report writing. We want to give Anne lots of time to write the report. What I am hearing, and you can correct me if I am wrong, is that we would like to hear overall groups and that perhaps the first invitations of the overall groups could be done by the subcommittee to establish the first four or five days of hearings; from there, the committee will determine who else it will listen to and who else it will invite.
Ms M. Ward: I would like to comment on the invited witnesses. I guess that is what you are talking about as the umbrella groups and so on. Looking at last year's, the summary provided here, under the economic outlook and fiscal policy section it does not seem to me there is much balance. My concern is that among those groups there be a broader balance of opinion. Likely the Bank of Nova Scotia, the Canadian Imperial Bank of Commerce and the C. D. Howe Institute would present fairly similar views. In the section where we have the summaries, the majority of points seem to come from the Howe institute. I would like to see a balancing point of view which is not quite so right-wing.
The Chair: I would interject, having read all of their forecasts, that they may come from the same part of the spectrum but they sure did not agree on what was going to happen. But that was maybe some other comparative analysis of the forecast.
Ms M. Ward: Recommendations.
Mr Hansen: What Ms Ward said there, I sort of agree that we wind up. We have the Bank of Nova Scotia, the CIBC. I think if we are calling more different areas, like the OFA, to come in to give a report -- another thing I would like to see, and I do not know if it has been done in the past or the procedure is being used, is that we have the invited witnesses first to actually give us an idea of the general economy out there and their input before we start hearing the oral presentations. Has that been done in the past, or are the invited witnesses filled in in between?
Ms Anderson: Last year the Ministry of Treasury and Economics was first and then the others were filled in in between.
Mr Hansen: I do not know the opinion of the rest of the members here on getting a broad view before we meet with any other groups. I feel that if we are meeting with some of the other groups who put their opinions forward, maybe we have made our minds up who the six groups or invited guests may be. That is wrong too. My feeling is I would like to hear the outlook first and then take a look at the groups after and come to decisions after that.
Ms Anderson: I think last year they intended to do that but there were often scheduling conflicts with the groups they invited, so it ended up that they were interspersed.
Mr Hansen: So they had the same idea but it just did not work. Let's try it again.
Mr Phillips: I agree totally with there being a range of opinion in the spectrum. I think I said that in my remarks. I think we all have to feel comfortable that we have a variety of opinion. The reason, Mr Christopherson, why I keep referring to An Agenda for People is that this is the blueprint. This is what we all have to work on, because that is what is going to be implemented over the next five years. We cannot ignore that, and all of our considerations have to take that into account because all those things have to be funded.
If you do not want to bring in the people who prepared it -- I did not say we would do research on it, but somebody has to make sure we understand what is meant by things in here, like the 60% funding for education. I assume, I guess, you people can answer it. We are not going to be able to ignore this document, because that is what has to be implemented. Certainly for me, as we go along, it will be, "All right, how is this going to be done?"
I have to keep it personally front and centre, so if you do not want to have the people who prepared it in detail here, I will just count on the other members knowing what is meant by it as we plan how it is going to be funded.
Mrs Sullivan: Just a couple of things. I apologize for having had to come late to this meeting. I wanted to just raise a couple of things. The economic witnesses who are listed in the invited section, the Bank of Nova Scotia, the CIBC, the C.D. Howe Institute, DRI and WEFA, tend to come to the committee if the committee wants them to, and to my mind it would be valuable this year to present an overview of the economic situation and the projections for the next period of time. Those projections will vary. I think when they do come, because of the different analyses that they use and whether they are looking at a shorter or longer term, you will see significant differences in some of their presentations that may be useful to the committee in exploring with them.
It is also useful to committee to have the economic witnesses, the analysts and forecasters before us, to see their predictions and projections and place them against those of Treasury and Economics, on which the budget is based, because Treasury does its own economic and econometric projections. It is useful to see if they are in line with the overall average or view of the other major economists in society.
One of the things I was surprised at, and it might be useful to think of this in terms of the committee, was that I did not know, for instance, that the Ontario Federation of Labour had a new economics division. They have not been included in our economists who have been coming before the committee. That might be useful. We may want them to do two parts to their presentation when they come, one seeing where they come from in terms of their economic projections and the other in terms of the other issues they are looking at in terms of the budget.
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One of the things that I think we will find is that the MUSH sector -- I do not know if you are familiar with that term, but it is basically the transfer agencies, the municipalities, the schools and the hospitals -- will come. Their umbrella groups will come. Whether they are invited or not, they will be anxious to appear, so that will cover several umbrella organizations. And this year I would suspect the Ontario Federation of Agriculture will be very anxious to appear, because the situation on the farm and through that whole sector is very seriously depressed.
Last year, if you look at the list, you will see that there were different organizations that wanted to appear, in the experience of this committee doing pre-budget consultations. Really, the ones who want to appear are reacting to what is a current situation in the economy. We may even well see people who would respond to an invitation or to an advertisement this year who have never responded before, simply because things in the economy are different and there are different pressures.
The organization representing alternative and independent schools was here three years ago. I do not know if they were a factor in your riding, but they were very active in my riding, wanting extension, by example, of provincial financing of alternative and independent schools. They may well want to be here this year, because they have become more active. They see the committee as a place to put their position forward.
There will be others who may not be interested in coming. The natural gas association may not be interested in coming this year because some of its concerns might be dealt with, say, in the Ontario Hydro environmental assessment process.
In addition to the major umbrella groups, and I do not know if you would have recommendations of other groups and organizations that you can suggest would reflect the current economic situation for special invitation, but I think that what we will see are the people who have an interest that is particular to this time will be coming forward in response to the advertisement.
Mr Jamison: I believe that probably will happen, but at the same time, I think it is incumbent upon ourselves to really look at trying to get as much of a cross-section of the community out there as possible. By that I mean the umbrella groups that are out there and have a great deal to contribute.
As I look down the list on the oral presentations, there is a great deal of overlap. There are probably some groups that did not make a presentation that we might be interested in. In expanding the invited witness list, I think we are going to be much farther ahead as a committee, especially with so many new people on the committee itself. We are really gleaning as much information as we can. I mean, for some people who sat on the committee before, it is probably going to seem repetitious, but again, we are looking at where we are economically now and where we are going to be in the future.
Mr Phillips made a comment that we should probably design our references to the Agenda for People. This is a committee of the House and I think that is secondary to really getting a grip on or feel for the economics of the situation. I understand what you are saying as far as that being the driving force behind this government, but I do not believe that is the specific job of this committee. I believe that the specific job of this committee is to try as much as possible -- and certainly everyone's crystal ball may read differently at the end of the exercise -- to get a handle on not only where we are today, but where we are going to be a year or two down the road and try to devise and propose to the Treasury a course of action that we can take to assist in the meantime.
That is why I have been very much in favour of Mr Kwinter's proposal, and that is to ensure that those umbrella groups -- you have made reference that in the first week we may be able to fit in 30 if we give the presentations an hour each. You may be able to fit more in. But I think if we evaluate -- and I believe this is what we did at the last meeting We gave a mandate to the subcommittee to evaluate that in particular. I do not think it is worth while rehashing and rehashing that.
I believe that we should move on from here, that the subcommittee should look at putting together that list on the basis of trying to get the umbrella groups covered, and go from there. I do believe that we are going to receive an extended list of people this year. It is my own feeling that there are going to be people out there who are going to make presentations who have never been here previously. That is why I believe it is very important to do that initial job of expanding the invited witnesses list and allow this committee to get on with the job in a more efficient manner.
Mr Sutherland: I do not totally remember the entire mandate we gave to the subcommittee, but there seems to be a general consensus about the groups we want to invite, or that we want a broad scope. So I am just wondering if it is not impinging upon what is given to the subcommittee, which I believe was correct, the first five days. Did we give the subcommittee the mandate to select the groups for the first five days?
The Chair: I believe that by consensus of the committee we can further refine the directions to the subcommittee. It has been suggested that one of those possible refinements could be that each party go back and decide three or four umbrella groups that it really wants to hear from and make sure that invitations are put forward. Then if I am reading the sentiments correctly, at the next stage anybody who has missed out or anybody else who is on the list can also be included at the wish of the entire committee as a whole. But I am getting this consensus that we want to have umbrella groups, that we want to have an overall picture of the economy, that we want to include as many of the umbrella groups as we can and that we want to have them early on so that we can have room to manoeuvre.
Mr Sutherland: And that is the subcommittee's mandate, though, based on what we have said so far. Correct?
The Chair: This is what I am hearing.
Mr Sutherland: If that is the case, could we move some of the discussion to the dates we are going to meet? Just from the pure practical standpoint, we all have other obligations, constituency obligations, and we cannot really go ahead with any of those, that type of planning, until we have some concrete dates as to when we are going to hold hearings.
The Chair: We do not know the dates. The party whips have to get together to determine what dates this committee is going to sit. There is some degree of discussion that is being carried on there.
Mr Sutherland: Okay. Sorry, I did not realize that process was left with them because it directly affects us and what we are able to do in our own constituency.
Mr Kwinter: The three weeks for the committee have already been assigned.
Mr Sutherland: Oh, it has; sorry. I missed that, my mistake.
Mr Phillips: The weeks of 21 and 28 January and 4 February.
The Chair: That is information that I have not had either.
Mr B. Ward: So I understand is it consensus that we are going to go back to our respective parties to prepare a list of what we think are umbrella groups and submit them to the subcommittee. I am sure that will get overlapping from all three parties, but perhaps the Liberals can think of somebody we did not or we will think of someone that the Conservatives did not, and then the subcommittee would set the schedule for those groups that are submitted on those lists. Is that going to be the way the subcommittee works? Then they will set up that first week, the schedule of all those umbrella groups that have been requested from the respective parties.
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The Chair: My sense is that from the amount of time we have and from what I have been hearing, we will have a lot of time to hear everybody, but what I am also hearing is that if there are specific groups that we really want to hear from, then let's get those names to the subcommittee so that they can be invited in the first round of meetings.
Mr B. Ward: Okay, good.
Mr Kwinter: I want to respond to Mrs Ward about her comments about the invited groups being right-wing.
The point is that with the people you want to get, you cannot get enough of those people and it has nothing to do with politics. The only area that politics enters into is on the spending end or on the revenue end and taxation end. You have control over that. You can decide you are going to raise taxes or lower taxes and that will impact on your revenues.
But the problem you have is that your spending is a direct function of your income. If the Treasurer has found that he has a $2.5-billion deficit right now, he would have had a greater deficit other than that he got windfall revenues from the federal government. Otherwise it would have gone up, and he has already admitted it will probably go up next year. So what happens with your revenues directly impacts on what happens to your expenditures.
The problem you have is that everybody does his forecasting in a different way. It is not a science; it is an art. You sit down and you try to anticipate to the best of your ability what your revenues are going to be. Now the Treasury people last year, in their advice to the Treasurer, whoever he may be -- and it does not matter what party he is from, he is a politician; he goes in there and they say to him, "Mr Treasurer, here is what you can expect your revenues to be." He then makes the decision how he is going to spend it above those that are already committed, and he decides whether he wants to balance it or whether he wants to go to a deficit or whatever it is. That is the only leeway the politician Treasurer has.
It is absolutely critical to anybody who is formulating a budget to have as precise a number as possible as to what his income is going to be. As I say, except for tax policy, which -- and I can tell you quite frankly, when we were in power, the Treasurer found that he had a shortfall of what he wanted to spend and he had to generate it somewhere and he raised the sales tax from 7% to 8%. That was done because in his opinion that was the fairest and most equitable way to get the kind of revenue he needed. Those are political decisions. But the banks and these think tanks are not talking politics. They are talking about what they think is going to be their expectation of what the economy is going to do, and what the economy does impacts on what your revenue is going to do. If they say that there is going to be a recession and your revenues are going to fall by so much whether you like or not, that is important information.
The Treasury people come up with their estimate, the banks come up with theirs, and they vary. Every year I used to go to the annual forecast meeting of the Bank of Montreal and they would say, "Interest rates are going to drop to 7% or 8%," and everybody would go out and say, "That's great," and the interest rates would go up. They were wrong.
What happens is that the more people you hear from, the better handle you get. You can take a median and you can suddenly question them. If the Bank of Montreal comes in one day and says, "We think interest rates next year are going to drop and go to 10%.'' and the CIBC comes in the next afternoon and says, "We think interest rates are going to go up," you say, "Well, how come another financial institution says they are going down and you say they're going up," and they tell you. They say, "Well, we don't agree with what they're saying." So you cannot get enough of that information. It is not such a thing as saying, "We are getting too much of that." You cannot get enough.
Now if someone gives you gratuitous advice as to what to do with your taxes. that represents either a right-wing or a left-wing or a centre philosophy, but that is not something we are really looking for. That is the politicians' decision. I used to tell my officials when I was in the ministry when they came forward: "Don't play politician with me. Give me the facts. We as the cabinet will play the politician. We will make the decisions. But we have to have the information on which to base those decisions."
As I say, you cannot get enough of that information. It is absolutely critical and because it is not uniform, every one of these guys -- the Treasury people have one attitude or one projection, one bank will have another projection, C.D. Howe will have another projection, and what you are trying to do is you are trying to say: "Okay, here is the worst-case scenario. Here is the best-case scenario. Hopefully, we will be somewhere in between. Where do you think we are going to be, based on all of this information? Let's make our plans accordingly."
There is the other thing I want to caution you about. Just to give you an example, in the 1990 list of witnesses they have the Canadian Automobile Association. You might think that represents the automotive industry, which it does not. It is very important that we do not get sort of deluded into thinking, "Oh, there is something that says automobile, so the automotive sector is heard from." It is absolutely critical in my opinion, because the automotive sector is the most important sector we have in the manufacturing industry, that we hear from at least one of two organizations.
One is the Canadian automobile manufacturers' association. These are the guys who build the cars and they are the guys who create all the jobs. Second is the Automotive Parts Manufacturers' Association of Canada, which is even bigger as far as job creation and the economy of Ontario are concerned. These guys are absolutely critical because the largest number of manufacturing jobs in Ontario is directly related to the automotive sector. It is sort like how goes General Motors, that is how goes the province. As it turns out, it is not exactly General Motors any more. but it is all of those guys.
I just want to make sure, and this is the job of the subcommittee, that we get the right people, the people who can really tell us what is going to happen and not just sort of get fooled by some organization that has a key name in it so that you think, "Okay, that sector is covered." I just want put that out as a caution.
The Chair: We are going to be heading back to the House in a few minutes because David is winding up on his presentation.
I was just consulting with the clerk, and in order to make sure that we have a wide presentation, I asked if it was possible for us to include in the advertisement that all written submissions should have a précis of the groups that are being represented by the umbrella group listed, so that we have an idea. Does the committee think that would be worth while including, to go ahead with that change to the advertising?
Mrs Sullivan: I would not include it in the advertisement. They will be in touch usually with the clerk and you can provide them with the information on the requirements relating to their presentation at that time. It just adds to space and so on.
The Chair: Then what he would do when they contact him is say that a statement will be sent in and we will have that.
Mrs Sullivan: Yes.
Mr Christopherson: I will try to be brief. First of all, we spent an awful lot of time really going in a lot of circles. We talked about most of this stuff at the last meeting. I do not know that we are breaking any new ground other than with regard to some of the specifics of where some of the broadening should take place. I hope at some point we are able to pull it together and get a focus.
The Chair: The rules of the committee, as I understand them, allow people to have their full say. At some point I could cut it off. I would rather not do that. I would rather that everybody have his say.
Mr Christopherson: Do not misunderstand me. I do not expect you, and I am not asking you to arbitrarily step in. I was asking you to provide some focus by way of suggestion.
The Chair: We are getting close.
Mr Christopherson: It was not criticism of you. It was just that I think, for all of us, that we are redoing the meeting we had last time.
I again go back to where Mr Phillips was on Agenda for People. I still do not agree with that. I am not convinced at all. I really see that as a partisan kind of thing and I think he knows that. I think that is the opposition's role and responsibility, to take the Agenda for People and do what it will with it in terms of costing and analysing it and then comparing it to our budget, comparing it to our programs, comparing it to our expenditures and holding us accountable in the House during question period and at other times. That is what that is for and I do not think that is what this arena is for, at least in my understanding of it right now.
Also, to comment on Mr Kwinter when he was responding to some of the comments of my colleague Mrs Ward --
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Ms M. Ward: Not Mrs; sorry.
Mr Christopherson: My apologizes, Ms Ward.
Mr Kwinter: My apologies as well.
Ms M Ward: I did not even catch that.
Mr Christopherson: And I was following your lead. See, maybe I should learn.
There is where we have to draw the distinction. I guess it is maybe more philosophical than partisan perhaps, but I think you will find that my colleagues and I do not necessarily consider broad-based, differing perspectives coming from the different banks -- granted, they may have different opinions, but we do not necessarily see the fact that we brought the CIBC and the Royal Bank and the Bank of Montreal in to necessitate having heard three completely different perspectives that kind of sum up the whole economic situation.
I had the opportunity to sit in with the Treasurer at a meeting with the chairmen of six of the national banks within the last week, and as fascinating a meeting as it was, there was obviously a philosophical consistency to their thinking, which they acknowledged and the Treasurer acknowledged his. It was all open and frank. But that is not the kind of diversity we are talking about. We would be talking about hearing from the banks and hearing from C.D. Howe, of course, all of those organizations, but also from credit unions, the Ontario Federation of Labour and the Ontario Federation of Agriculture in terms of their economic perspectives.
Where I disagree with Mr Kwinter's assumptions is that while you can be very accurate in terms of tallying things that have already happened, there is a great diversity of opinion as to what will stimulate what in the economy and what kind of results you will get. It is the foundation of most of our philosophical disagreements. So I think that we might see a much wider definition of "broad-based" than your comments suggested. I think that Ms Ward was reflecting on the fact that we would like to see the ideological and philosophical base as broad as possible, as well as hearing from those professionals acknowledged as being the leading economic thinkers who get the coverage in our mainstream society.
I think it is important that we remember that we went through the whole discussion of process already. I do not think there is any change. We had some differences. We found some common ground and that is where we cut it. The subcommittee would decide what the schedule was at its pleasure for the first week. It would make a recommendation to us after the first meeting for the balance of the two weeks. We would then collectively decide whether -- I think "subject to the approval" were the exact words, with the understanding that if somebody wanted to add or make any changes, then they had that opportunity and the full committee would adopt the agenda for the last two weeks.
I do not see any need to rehash that. I thought that was a fair compromise in terms of some of the differing viewpoints we had about process. The idea of each of the three parties having an opportunity to submit two or three to the subcommittee for that first week I think is a good refinement of that, but it does not change that basic understanding. I think that pretty much covers everything I had to say.
Mr Hansen: The one thing I would like to know is when we are going to be picking these invited witnesses. I would say that it has to be done before we go home this weekend to give them some lead time in order to prepare a report that would be focused on what we are looking for. So at 3:30 -- would that be too short notice? -- the three parties could come back with invited witnesses.
The Chair: Maybe we could come back and determine a date that we are going to have early in the new year to have the subcommittee meet, or the subcommittee could meet at 3:30.
Mr Kwinter: Can I make a suggestion? This ad is going in the first week of January; in your experience, how long does it take to get responses?
Clerk of the Committee: Some responses come in immediately. In my experience the bulk of the responses usually flow in within the first week after the ads run.
Mr Kwinter: Maybe what we could do to facilitate it, so we do not have double work, is run the ad, see the responses and then take a look at it. We may get a lot of the people we want to invite in those responses. Certainly, we may get enough to get us going in the first week, and then once we see where there are some holes, where we are not getting representation, then we can go out and invite those people. We may come up with a list and every one of those people are going to respond anyway. If you take a look at the past list, you will see the OFL is always there, the OFA. Once we know they are there, we can put them in, and we can sit down and see where there are some holes, areas where we do not have adequate representation, and make the decision then.
Mr Hansen: One thing I was looking at is the Bank of Nova Scotia or CIBC. I look at the previous years. They were not invited in 1988 or 1989; they have not given an oral presentation or a written one. This is where you are looking at the economic picture. The other people coming forward with oral presentations and written submissions seem to be, as people have been saying, from umbrella groups throughout Ontario. I think it is important that if we are going invite the Bank of Nova Scotia, it has some lead time to prepare. That is why I was getting to the point.
The Chair: These banks and think tanks do these kinds of projections on an ongoing basis. They do not need as much lead time, because they publish them, they send them out to their shareholders and so on. They can come in, I think, on pretty short notice and do a presentation. That is just from my own perspective.
Ms M. Ward: I wanted to clarify, responding to Mr Kwinter's response to me. I realize quite well that projections are not something that is political opinion, although one can certainly bias models one might use to do those economic projections. That is not what I was talking about when I was talking about right-wing and left-wing. I was talking about the recommendations you end up with, for instance, from the C.D. Howe Institute: "Government should not employ discretionary fiscal policy to stimulate faster economic growth in l990-l991." That is where I would like to see a broader range, because those recommendations are what you end up with and if you only have one particular range of views it limits the options that people see available. So I was not talking about a prediction of what is going to happen in the future economically as being a right-wing or left-wing view. I felt that you thought I was viewing it that way. That is not the case. It is the recommendations that I would like to see a broader range of views on.
Mr Sutherland: It is my understanding that we have the weeks we are going to meet in but we do not have the exact dates set, how long we are going to give each group and whether we are going to sit from 10 to 4 or from 10 to 5. I would like to have that information decided today so I can plan around that for constituency obligations I may have.
The Chair: As I drew a line under your name, you have the last word. As that was the last word, can we move on to that item? Do we have a consensus of 10 to noon? Everybody agrees we will meet from 10 to noon, Monday through Thursday. Do we want to include Friday? Friday is usually a constituency day. What is the feeling?
Mrs Sullivan: I would suggest that we plan to meet from 10 to noon and then from 2 to 4, unless we or the subcommittee decides to extend those sittings based on the number of groups or witnesses who want to appear, and that the decision relating to Friday sittings also be based on the number of groups or individuals who want to appear. It is not unusual for committees to sit on Fridays. It does make it difficult in terms of scheduling constituency days but it is not unusual, and the groups and organizations are certainly willing to come in on Friday as long the members are here.
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Mr Sutherland: I would concur with that except for Mondays. Could we not skip a morning session and start at 1 pm on Mondays?
The Chair: What is the feeling on that? I know some people have to come from a distance; others are not so far.
Mr B. Ward: I would suggest that the first Monday we meet at 1 pm. Again, it is how many groups or organizations want to give presentations. We want to listen to all if possible. If the numbers are there that we have to meet Monday mornings, then we should. But I would suggest for the first Monday that we meet at 1 to allow the people who have to travel quite a way to leave their homes at a decent time. I would also suggest that we exclude Fridays, mainly because that is my constituency day. However, if the numbers are there, then we should include Fridays. For the first week, Monday at 1 and exclude Friday.
Mr Hansen: I had the understanding at the very beginning when we approved the budget that we had three weeks of meetings, 15 days, that that is what we approved. Now we are changing that budget?
Mrs Sullivan: You do not have to spend it.
Mr Hansen: It is not that. You know, you have it in your mind already that you approved the budget, that you are sitting for five days a week for three weeks. I know what I do down in my riding; I just schedule the Saturday morning if I have to meet with people. It depends on the number of people we have coming forward to have presentations that will generate exactly how many days we are sitting. We have budgeted for 15. If we are cutting back now, and then we have more groups, then we have to change again and go back to 15 days. Maybe we should make it straight now. We will look at the 15 days. If we can cut back, then we will cut Fridays and Monday mornings or whatever. Most of us on this committee are within driving distance of Toronto, not from the north or Sudbury or that far away, if I am not mistaken.
Mr Sutherland: I believe I am the farthest.
The Chair: What I have heard is the first Monday to meet from 1 to 4, then to have meetings from 10 to noon and 1 to 4, leave Fridays in as it stands now but use them only if needed. Is that what I am hearing? Do I have a consensus on that?
Mr Sutherland: I might have missed it, but when is the deadline that we are making this report?
Ms Anderson: It is the last day of the hearings.
The Chair: Somewhere around 11 February.
Ms Anderson: The last day the committee can meet. The report has to be approved at that point if it is going to be approved by the whole committee.
The Chair: We have to go through it. The recommendations in that report we have to go through clause by clause, and either we get the unanimous consent of the committee or we get a majority view of the committee. The majority view of the committee will be written up and then, if there are dissenting views or alternative views, they will be written, as I understand it, by the people who are dissenting. They can be included at the end of the report as dissenting views.
Mr Sutherland: I guess the deadline I want to know is when this has to go into Treasury so it can be taken into consideration.
The Chair: The middle of February. Once we have made all our resolutions and they come together in a report, that report can go back to be rewritten and then it goes to Treasury.
Mr Sutherland: The middle of February being 15 February, that Friday?
The Chair: It is included.
Mr Christopherson: So what is the first day of our hearings?
The Chair: January 21. Any questions?
Mr Christopherson: If there is nothing further on that, the Hansard. I have asked some of my colleagues. None of us has the Hansard from the last meeting.
The Chair: It has not been printed yet.
Mr Christopherson: What is the normal procedure once we get into full swing?
Clerk of the Committee: I cannot really speak for Hansard, but as far as I know the normal time between a committee meeting and the time the final printed Hansard would be available would be about a week. When the House is meeting it takes precedence and Hansard generates the Hansard document for the House on a first-priority basis. When the House is not meeting, the committees will probably get a little quicker.
Mr Christopherson: That is fine. I can appreciate that the House has to take precedence. It is just something I would like to hang on to. They are mailed out, I would assume. to all members automatically. While I am on the point, what about Hansards for other committees? Do you have to request them or are they available? How does that work?
Mr Kwinter: What happens is that you get bound copies eventually of all of the committees. They do not distribute them, I do not think, to every member unless you request them. Eventually, though, you will get bound copies of every committee.
Mr Christopherson: But during those times when the odd individual gives a less than dynamic speech and you want to do some reading, you can get the current Hansards from the other committees? Thank you.
The Chair: As we have all agreed on that, is there any other business? I took the liberty of extrapolating from yesterday's meeting with the other chairmen of the committees to ask Mr Decker to bring forward committee expense reports. I would like a motion to go in camera with this. It is really a lesson on how to fill it out.
Mr Christopherson: Why would we go in camera?
The Chair: Trust me on this one, okay? I guess we will adjourn this part of the meeting and then just move to the next part.
The committee continued in camera at 1128.