Mr Ted Arnott (Waterloo-Wellington PC)
Mr Marcel Beaubien (Lambton-Kent-Middlesex PC)
Mr David Christopherson (Hamilton West / -Ouest ND)
Mr Doug Galt (Northumberland PC)
Mr Monte Kwinter (York Centre / -Centre L)
Mrs Tina R. Molinari (Thornhill PC)
Mr Gerry Phillips (Scarborough-Agincourt L)
Mr David Young (Willowdale PC)
Substitutions / Membres remplaçants
Mr Joseph Cordiano (York South-Weston / York-Sud-Weston L)
Mr John O'Toole (Durham PC)
Also taking part / Autres participants et
participantes
Mrs Lyn McLeod (Thunder Bay-Atikokan L)
Clerk / Greffière
Ms Susan Sourial
Staff / Personnel
Mr David Rampersad and Ms Elaine Campbell,
research officers,
Research and Information Services
The committee met at
1000 in room 151.
PRE-BUDGET CONSULTATIONS
The Chair (Mr Marcel
Beaubien): Good morning, everyone. I would like to bring
this committee to order.
ONTARIO HOSPITAL ASSOCIATION
The Chair:
Our first presentation this morning is from the Ontario Hospital
Association. I would ask the presenters to come forward and state
your names for the record. On behalf of the committee, welcome.
You have 30 minutes for your presentation this morning.
Mr Frank
Norman: Good morning, Mr President, ladies and
gentlemen. My name is Frank Norman and I am the chair of the
Ontario Hospital Association board of directors. Joining me today
is David MacKinnon, the president and chief executive officer of
the Ontario Hospital Association, and Mary Lapaine, who chairs
the OHA's advocacy committee.
Before we start, I'd like to
say I'm not a health care professional nor am I employed in
health care. Mary Lapaine and I are volunteers who have been
privileged to serve in the health care system for many years, and
for all its trials and tribulations, it's a very impressive
system. There are more than 41,000 volunteers in the hospital
sector and, like you, they are there to make a difference.
"What can we do to make a
difference together?" is the theme of our remarks today. We could
spend the time with you today summarizing the contents of our
pre-budget submission, Future Health: Hospitals for the 21st
Century, a very detailed and comprehensive paper that draws on
extensive research and incorporates views of our membership
throughout Ontario. Those views were reinforced as recently as
yesterday afternoon when there was, in fact, a special general
meeting of the association. I know you will find this paper,
which describes the issues and opportunities facing hospitals
today, useful. I would, however, like to focus my remarks on the
opportunities within the upcoming budget to make a difference for
health care in Ontario.
As you are well aware, there
are serious challenges facing hospitals in Ontario and these can
only be addressed by clear policy choices. Without thoughtful
debate and resolution of key issues, the problems facing
hospitals cannot be solved. The fundamental choices about how we
deliver health care and how we pay for it cannot be avoided. To
postpone these decisions may run the risk of moving health care
into a different kind of system and one with unintended
consequences.
I am suggesting that we make
difficult choices, not because I would wish to see us move toward
a different system for the sake of it, but to ensure that the
current system is there for our children and our grandchildren.
In short, the biggest risk to our health care system may be
standing still or just tinkering with the current system.
I am now going to ask David
MacKinnon to outline the issues that we believe are on the minds
of legislators, health professionals and the public and to
describe what we can do together to address them. From that, I
would suggest that we can discuss the choices we have before
us.
Mr David
MacKinnon: From everything we have heard in recent
months, including Mr Harris's comments after a recent meeting of
the government caucus, the issues on legislators' minds about
hospitals and health care are, first, how can we escape from what
seems to be an ever-increasing health care budget, especially
during times of revenue uncertainty? Second, will continued
investments in health care put other essential public services at
risk; for example, education and the environment? Third, what can
be done to meet our health human resource challenges, absolutely
serious challenges? How can we retain the health care
professionals we have and recruit others we need in the face of
worldwide shortages? Fourth, how can the system be made more
patient- or consumer-focused and accountable to those who are
paying for it, the people of Ontario? Next, how can medical
practice be modernized to make the system more sustainable and
affordable? Finally, and perhaps even most importantly, how can
we enlist individuals into the important task of managing health
care better and keeping the costs attached to it under
control?
These are all formidable
challenges. Each of them is formidable individually, but taken
together they are very formidable indeed. In dealing with these
challenges and reflecting on the need for basic choice, we really
do not mean to imply that any one solution or path is available
to take us where we want to go. Certainly, if any such a path
existed we would have found it long ago.
Health professionals are all
too familiar with grand designs for the future that prove to be
unmanageable due to the incredible complexity of the system and
the very intense values that
different groups or individuals bring to it. Nor do we mean to
imply that considerable progress has not been made. Progress has
been made. Primary care reform is starting, hospital
modernization is underway in most corners of the province and
hospital report cards are just a few examples of progress in the
system, and I could list many more. However, on balance, I think
most who look at our system today would recognize, as Mr Harris
did, that we need to search for further answers.
For hospitals, the reasons
for this need to search further are clear. The financial
pressures on hospitals and the health care system are absolutely
inexorable and they face us every year. Every year, hospitals are
faced with increased demand for more and better services. As our
annual review of hospital finances shows, hospitals need an
additional $400 million to $500 million every year just to keep
up with population growth, aging and other cost pressures.
Over the last two years,
medical and surgical supplies, including drugs, increased on
average by 12% a year, well above the rate of inflation.
Hospitals are already running at very high levels of efficiency
compared to other provinces and US hospitals; however, they are
constrained by the fact hospitals in Ontario have no cash
reserves and many are purchasing goods and services on
credit.
The pressures on front-line
staff, as you will probably hear from the nurses this afternoon,
are reaching unbearable levels, and yet we need to make sure we
retain the staff we have, that they feel comfortable, and that
Ontario hospitals become the employers of choice for future
health care professionals. We're certainly not in that position
today. I could go on.
We're not unsympathetic and
we really understand the other side of the argument. It is no
wonder that every year when we appear before this committee
delivering similar messages, I can almost hear the groans from
some committee members and from the Ministry of Finance and from
much of the senior civil service. But the pressures are
absolutely real. We understand that with the possibility of a
slowing economy there will be pressures to cut costs. However,
squeezing more out of hospitals at a time when they need to
retool for the future or tinkering with the system in a
cost-based way could undermine the future of patient care.
Investing in health care is
investing in our future, our quality of life and jobs and
economic growth. I should stress that the health care system in
Ontario is one of the two or three principal sources of the
province's competitive advantage in terms of industrial location
relative to the United States and around the world, and it is
inextricably linked with our economic performance for that
reason. If we had a serious deterioration in that system, then
our economic performance sooner or later could also be seriously
eroded.
Hospitals feel that we do
need to find more cost-effective ways of delivering patient care
services, and we are doing that. The paper-again, as Frank
mentioned, we won't go into it in detail because it's here and it
obviously demands close perusal, but I think you can see that we
have many suggestions to make that will improve the system as we
go forward. But I think most of us in the room, most people in
society, regardless of our political leanings or personal values,
would agree that notwithstanding all the things that we recommend
we do that are underway, we still need to consider alternate
paths to the future to put the system on to a more sustainable
track.
What are those paths? The
first path probably relates to the role of health care consumers.
Everyone can play a role in solving health care problems. To be
very frank-and I know that this comment is controversial to some
extent-society cannot afford a health care system that protects
people completely from negative lifestyle choices such as
smoking, lack of exercise and poor nutrition. We cannot, to the
regret of everyone here and to the regret of everyone in the
system, protect everyone from the consequences of their choices
made over decades. There are remarkable savings to be made if we
recognize this and focus greater efforts on health promotion and
illness prevention.
A second path is to empower
and better equip front-line health care deliverers. We cannot
expect them to continuously do more unless we upgrade their
skills and invest in technology so that they feel better
supported. As an industry, hospitals in Ontario for many years
have been underinvesting in skills development and we believe,
relative to other jurisdictions around the world, are falling
behind in the use of medical equipment, information and
communications technology.
There are many issues and
steps that we could recommend to translate these broad themes
into specific action. We think it is essential that we end the
stop-and-go funding that is leading to uncertainty and disruption
in patient care services. We are recommending that the province
provide hospitals with adequate three-year funding commitments to
enhance recruitment and retention of health care workers and to
give better predictability to the system. I think if you cast
your mind to what Sunnybrook or the Hamilton Health Sciences Corp
or any of the very large community hospitals look like, you will
readily understand the difficulty of managing them when sometimes
the budget allocation is not known to them until they're well
into the year for which that allocation applies. They can't turn
on a dime; they are big. We simply cannot wisely live with that
kind of unpredictability.
1010
We also recommend that
hospitals must constantly upgrade medical equipment, information
technology and our ability to generally keep pace with new
clinical practices. We really do need to stress how important
modernizing capital funding for hospitals is. It is there not
only to serve the consumer better, but to contain costs in the
future.
We need, as you'll see from
my earlier remarks, to play a much broader role in improving
health human resource planning.
We need to make sure that we do something, including
possibly the establishment of a health knowledge fund, that will
foster training and education, including e-learning. The Internet
is changing the world of health care in hospitals just as much as
it is changing the world of banks and consumers. It's important
to recognize that, because in there lie possibilities for the
future that can help us make the system more sustainable.
We also think that public
accountability for the health care system is important. We
believe that all health care organizations and professions who
receive public funds should produce annual report cards, similar
to the hospital report cards we now produce, as a condition of
receiving these public funds. We think full transparency to the
taxpayer is one of the most important elements in restoring and
improving public confidence in the system.
We also need to accelerate
the integration of health care services, not by great new grand
designs or corporate organizations, but by simply enabling
hospital boards and the governance structures of other providers
to enter into local partnerships for the provision of patient
care.
I'd like to stress,
however-you may see it from my previous comments-that we must
make a major effort to encourage the public to do as much as
possible for themselves. We favour continued expansion of new
health care delivery services, such as the telecare service
recently introduced in Toronto and in North Bay, and the
development of e-health patterns of delivery. These will open up
new ways to deliver hospital services to people. Imagine, the
hospital of the future will deliver services to people in their
home, at work or wherever they happen to be, and probably will
not be defined as a piece of geography but rather more as a
bundle of services to be delivered to people wherever they are
and at whatever time they really need them.
We think health care
providers, together with the government, should implement an
all-out health promotion and illness prevention program to
improve health outcomes and reduce costs to the taxpayers. We
have made major progress as a society in the campaign against
drunk driving. We have made major progress as a society in
smoking cessation-probably not enough, but viewed over the last
20 years, amazing progress. We could probably do some of the same
for lifestyle-related illnesses. If we all took a greater sense
of recognition of the need to do that and acted accordingly,
ultimately the costs attached to the system could come under much
closer control.
Finally, we believe we need
to enter into new and innovative public-private sector
partnerships for the capitalization of the system, provided they
are consistent with the Canada Health Act. Our submission
recommends removing barriers and introducing incentives to foster
public-private sector partnerships in the areas of capital
development and new technology. If we can find ways of mobilizing
the skills and the finances of the private sector to better
support our system, in line with the fundamental philosophy
governing that system, we think there are major possibilities for
reducing the problems that are readily apparent today.
I would like to close there
so that there's ample time for questioning. We very much
appreciate your attention today. Mr Norman, Ms Lapaine and I
would be happy to answer any questions.
The Chair:
Thank you very much. We have approximately three minutes per
caucus. I'll start with the official opposition.
Mrs Lyn McLeod
(Thunder Bay-Atikokan): In three minutes there are a lot
of questions I would love to have the opportunity to place to you
around both the stop-and-go funding that you've mentioned and the
inadequacy of hospital funding. Perhaps the first area I'd like
to focus on ties into the public-private sector partnerships,
which was your last point, in one specific aspect. I may not get
time to get to another key area that I would have liked to ask
you about, and one is the difficulty in hiring full-time nurses
on contract, or even part-time nurses on contract, if you don't
get your funding until the end of October. So let me put on
record that I think that's been a real limitation for hospitals
in dealing with nursing shortages. I'd like to ask you about the
increasing strain on hospital budgets of having to provide
incentives for physicians, and I'd like to ask you about the new
funding formula and why we haven't seen the new funding formula
for hospitals.
But since I only have three
minutes, I want to ask you about something that may be seen as a
bit controversial too, and it does tie into this whole aspect of
public-private partnerships but in a different way than I think
you are suggesting in your bullet point. I want to specifically
use the MRI situation as an area for questioning. As we know,
there have been some stories about the private sector use of MRIs
in hospitals. I do not believe from anything I know of that the
hospitals have been utilizing those MRIs in any way which is
inappropriate under government regulations. They've been using
them, as I understand it, for third-party purposes, which is
essentially private-pay use but for unlisted services under OHIP,
so it's services that are not covered by the Canada Health Act.
So if there's any question of listed services, medically
essential services being paid for, it's not as a result of what
the hospital has done, as far as I know.
My concern, though, is that
hospitals have long waiting lists for MRIs. In Ottawa it's as
long as seven months waiting for an MRI. If there are the
personnel to use those machines that the hospitals have now, if
they're available to do after-hours work, and if those machines
are not being used for publicly paid-for purposes, if they're
free to be used for third-party use, would it not be possible,
given adequate resources in the hospitals' global budgets, to use
those MRIs for publicly paid-for services and reduce the wait for
those publicly paid-for services?
The other part of the
question is, is it the inadequacy of budgets to be able to hire
the staff to run them for publicly paid-for purposes after hours?
Is it also the fact that hospitals are feeling a desperate need to bring
in some revenue because of the inadequacy of their budgets?
Mr
MacKinnon: I'd like to make one comment first before
turning it over to Mr Norman, who has been associated with some
of these issues for a very long period of time. What we need to
do in health care in Ontario is make benchmarks. For example, the
number of images per 100,000 of the population for MRIs is a
reasonably common benchmark. What we need to do in Ontario health
care is focus on our ability to achieve generally recognized
international standards in that kind of area. If we do that, the
capacity can then be identified and built in. What we can't do is
keep on making those kinds of decisions incrementally in
accordance with very short-term pressures or demands. I know that
may appear to be a little confusing, but it is fundamental that
we-
Mrs McLeod:
It's not confusing at all, but it raises a second fundamental
question: are we meeting that kind of a benchmark now, and do we
have any data?
The Chair:
Ms McLeod, you're going to have to let Mr MacKinnon answer
because we're running out of time.
Mrs McLeod:
I think he raises another question of whether we are meeting the
benchmark and whether we have data to know whether we're meeting
the benchmark.
Mr
MacKinnon: The fundamental need is to achieve the
standards worldwide and I think we have some way to go to do
that. But the fundamental thing we need to keep track of as a
society is, what are those benchmarks? We can't simply make
decisions incrementally, because sooner or later we will run into
trouble with MRIs or with other types of equipment or with the
physical facilities themselves.
Mrs McLeod:
But if we're not meeting the benchmark, we've got a way to
go.
Mr Norman:
I'm not sure that's absolutely where I would come from on that
one. My background is that of Kingston, the world of an academic
health science centre, which does have an MRI, and where the
waiting lists are of a quantity whereby people come from Ottawa
to have work done there because it can be done.
The limitation is not the
public-private limitation. It isn't that at all. The limitation
is driven by two things; first of all, the cost of the staff to
run them, which you really can't solve by saying, "We'll take the
third party and make that happen." There's not enough in that to
do that, quite frankly.
The other aspect of it is the
technical support which is needed in order to be able to read the
bits and pieces. I'd like, if I may, to take you into a slightly
different area. I think that as we look at the developments for
technology which are in existence at the moment, we have the
technology to be able to do an MRI scan in one location and have
it read hundreds of miles away. That's the technology we need to
be able to promote at this moment in time, because it has a
distinct human resource element to it. We no longer have to have
the radiological technicians sitting at the place where the
viewing is being done. We can read those things at 30 frames a
second hundreds of miles away today.
1020
The Chair:
Ms Molinari first, and I'll go back to Mr Christopherson
after.
Mrs Tina R. Molinari
(Thornhill): Thank you very much for your presentation.
You've raised some very key issues in your presentation. I have a
couple of questions and first some comments.
You talked about finding more
cost-effective ways, because in the system that we presently
have, in order to sustain it over the long term, of course we
have to continue finding efficiencies and ways of offering the
service. I appreciate in your presentation your recognition of
that.
You've also made comments
with respect to the fact that we can't completely protect people
from negative lifestyles, which is true, but certainly also the
greater efforts on health promotion to prevent illness. I'd like
to hear some ideas and some comments on that.
Your point about the
multi-funding commitment I think is key, and I understand your
points and where that's coming from. When you're budgeting, if
you've got multi-year budgeting it assists you in being able to
plan for the future, and certainly I recognize that.
You also mentioned the annual
report cards being something that should be supported. Let me ask
you your thoughts on giving patients an account of what the
services cost when they go into a doctor's office. That's
something that's been discussed and debated numerous times: if
the patient actually knew what the cost of that visit was, might
that affect the way they're using or sometimes abusing the system
that is presently in place? What are your thoughts on that?
I'm particularly interested
in your comments on partnerships and developing more
partnerships, because I think in the future we need to look at
more efficient, innovative ways of providing the service that is
absolutely essential and something that's sustainable. We all
need to take part in the delivery of that and the success of
that. If you could comment on some of those things, I would
appreciate it; it would be helpful.
Mr
MacKinnon: I will ask Mary, perhaps, to take the very
first part of the question, dealing with health promotion and
wellness which you mentioned. But on the last issue of the
accounting of services, hospitals over time have done some of
that in relation to hospital visits and what it costs individual
consumers. The problem with it is that (a) it didn't seem to have
a huge impact, and (b) the costs of the system were considerable,
relative to any benefit that we could see deriving from them-and
they always, of course, had to be assessed in relation to the
costs of putting the same amount of money into an MRI machine or
something else.
In talking to the Ministry of
Health, our general sense is that we would like to experiment a
little bit with that and we would like to see whether new changes
in computer technology and so on make it more feasible than it
was perhaps 15 or 20 years ago. It's very attractive on the surface, but for the reasons I
mentioned, it hasn't always been possible to do it in a way that
has some real impact. Of course, the pressure of putting the
money, then, into something that does have a real impact is
absolutely implacable. But we're willing to experiment, I think,
is what the current play is. We'd like to do a little bit of
experimentation.
On the issue of public
sector-private sector partnerships, again, I think if we can take
a step back and say, "How do we mobilize the talents of society
to solve our problems?" that's kind of the right question to ask.
That involves not just the private sector always but it involves
those who represent the people who work in hospitals, unions, the
whole thing. This is a broader problem than anything that the
traditional medical professions can handle.
Mary, would you like to
comment on the lifestyle issue?
Mrs Mary
Lapaine: Yes. It's very interesting, particularly your
comment-I'll get to the lifestyle-on the billing. I think if
there's something as a volunteer that I get asked about the most,
it's billings, not only in hospitals but in doctors' offices. I
think you're very right in saying that a lot of people just don't
realize what those visits cost. There is an abuse of the system,
I don't think necessarily intentionally, but it appears to be
free, and anything that's free, why wouldn't we use it? So I
think there is definitely a need for that. It certainly has to be
a collaborative measure between us and the OMA, obviously,
because it's going to impact doctors and their offices, although
doctors working closer with hospitals are a thing of the future
and it's definitely going to be happening in Ontario.
As for lifestyles, I think it
is very interesting. We just had this conversation this morning,
particularly about smoking and drunk driving. Your children and,
in my case, grandchildren are a perfect example of coming home
from school totally indoctrinated in the fact that no adult
should smoke. It's just a way of life. I think we can do the same
thing with diet, with exercise. We're moving toward it but I
don't think it's a concentrated effort. Unfortunately health care
institutions, with the budgets we have, are working so hard to
get people well who are sick that we don't have the money to go
out and spend it on the wellness issue, which we are all very
aware of and would love to have the opportunity to do.
Mr David
Christopherson (Hamilton West): My apologies for missing
the first part of your presentation. I want to step back and ask
about the whole system. We hear from the hospitals, as you
mention, $400 million or $500 million just to keep up with
population growth, aging and other pressures, and I'm sure that's
not the end of the list. We heard yesterday from community health
centres that showed a terrific track record of service to the
community, and I used the example in Hamilton to support that
thought, but they are clearly underfunded too and they don't have
the money they need. We talked to people in long-term care and,
again, they think they can handle the issue if they get enough
funding along the way to be ready.
I'm talking about the whole
continuum. At the beginning of it is the community care, now done
through CCACs. In Hamilton, because of underfunding, we went
through lengthy, bitter strikes with the VON, who struck not
against their management but against this government in terms of
lack of funding, and the same with the CCAC case managers. So
everywhere along the continuum there seems to be underfunding, at
the same time that we're supposed to be changing the emphasis
from the institutional side of things more into the community
end.
I'm wondering, not just in
nominal dollars, whether or not you think there is a shortfall,
because obviously you do, but is there enough-I'd like your sense
of the percentage of funding that's going into each stage of the
health care continuum as it exists and also as it evolves.
Mr
MacKinnon: Perhaps I can just make one comment. As you
can see from our comments, the most important stage of all,
working on lifestyle-related illnesses which cause so many of the
problems and issues we deal with, is something we really need to
do much more of as a society.
On the second issue, perhaps
one comment I'd make-and I'm sure Frank and Mary may want to
comment as well-is that the problem we're facing is not
fundamentally an organizational problem, and there is no
organizational solution to it. What we're facing is relatively
fixed capacity in terms of money, health professionals and so on,
and infinitely elastic demand, and those don't meet. There have
been all kinds of efforts; I can count 20 years of books and
visions about how to organize the health care system so that it
deals better with the problems and I don't think any of them have
really amounted to very much. What we have to do is deal
fundamentally with the problems of why we have these issues in
the first place and deal with the technology and all the other
issues mentioned in our submission.
The one thought I would like
to leave very strongly is that there is no way we can deal with
this by simple organizational change. All the other providers
play a very important role. Hospitals in most parts of Ontario
work very well with them, and closely. You can't run a hospital
without a good nursing home industry nearby. All those issues are
there. But it's not going to be an organizational solution that
gets us out of the problems we've got. It's an all-out effort in
every direction.
The Chair:
It's a very impressive discussion, but I must maintain-on behalf
of the committee, thank you very much for your presentation this
morning.
1030
ONTARIO ROAD BUILDERS' ASSOCIATION
The Chair:
Our next presentation is from the Ontario builders' association.
I would ask the presenter or presenters to come forward and state
your name for the record. On behalf of the committee,
welcome.
Mr Rob Bradford: I'm Rob Bradford.
I'm the executive director of the Ontario Road Builders'
Association, Mr Chairman, not to get us mixed up with those
fellows who put up the big buildings.
Our organization appreciates
the opportunity to meet with you again this year and the chance
to speak with you about the importance of a strong public
commitment to Ontario's roads infrastructure.
I would like to spend a few
minutes this morning to speak to three general subject areas: the
government's commitment to capital investment in the provincial
highway system, concerns about our municipal roads and bridges,
and the benefits taxpayers could expect from a longer-term
approach to capital planning in Ontario.
In the past several years we
have seen an increasing commitment to investment in our
provincial highway system. This welcome growing commitment is
highlighted by a record $1-billion highways program in the
current fiscal year. The provincial government is to be
congratulated for this renewed commitment to provincial
highways.
That said with all sincerity,
it is our responsibility to point out that significant investment
in our highways is needed today to answer for almost three
decades of neglect and underfunding that left a system once
envied by the world in a sorely deteriorated condition. You will
recall that in 1995 the Provincial Auditor said 60% of Ontario's
highways were in unacceptable condition. Six years later that
statistic has improved dramatically, but the message today is
that the job is not nearly completed and the province must
maintain a strong and growing commitment to ensure that Ontario's
highways will be able to adequately serve our growing,
export-based economy.
We pointed out last year, and
it is worth repeating, that Ontario exports account for over 50%
of our GDP now. Over three quarters of those exports go south to
the United States and 95% of them depend on road transportation
for at least part of the trip.
I believe, or at least I
hope, we're past the point where it is necessary to repeat for
this committee all of the statistics and studies that show the
importance of our highway system to our economic growth, to
public safety and to quality of life. We have talked to this
committee about the $3.5 billion per year spent in Ontario by
American tourists arriving here by car, we have spoken to you
about the implications for public safety and quality of life and
we have quantified the effects of congestion on productivity. I
could use my full 30 minutes today rhyming off those statistics
for you, but we believe that those connections are now well made
and understood by governments today. So the objective now must be
to respond to those facts and figures with the appropriate public
commitment to provincial highways.
While Ontario has taken some
very positive steps toward bringing our current highway system up
to acceptable standards and maintaining them that way, the other
half of the equation-system expansion-is still not being
addressed in a significant way. Keeping the 401 and 417 and
Highway 69 to the north in decent shape is one thing, but
addressing the needs of the future is another. There must be a
renewed investment in new highways very soon or the congestion
and gridlock nightmares we are experiencing today in major urban
centres will soon seem like the good old days. Recent attention
in the media and statements by members of the government have
underscored the fact that congestion has reached crisis
proportions in the GTA.
Growth projections to the
east, west and north of the GTA will bring the movement of goods
and people to a halt if we do not begin to address system
capacity. In the Golden Horseshoe area over the next 20 years,
there will be a million more vehicles on local roads. Rush hour
trips in the GTA will increase 50%, to 3.6 million per day, by
2021.
Our industry has been
encouraged by the apparent changes in public opinion that have
brought a recent renewed focus to highway congestion as a
priority issue. But we are concerned that in those same news
articles and features there is a growing misconception that the
GTA's congestion problems can be solved simply by expanding
subway systems or bringing a few more GO trains into Union
Station every day. This ignores the role which expanded road
capacity must play in the solutions.
We support the government's
recently announced emphasis on a smart-growth approach to
planning our urban centres and transportation systems of the
future. It's a strategy that is long past due, and if it's
handled well it will provide solutions for the future in
transportation. But in developing our strategies for the fixture,
again, we must avoid the misconception that Ontario's
transportation problems can be solved by ignoring roads and
focusing completely on public transit. It is a naive and
dangerous misconception because that type of tunnel vision
ignores the reality that people aren't about to give up their
cars tomorrow, nor does it speak to questions about how we get
our products and manufactured goods to market and to the border
or how we get our raw materials to our factories.
We tend to talk these days
about roads and public transit as if somehow they are mutually
exclusive, as if the answers lie with either one or the over. It
might be enlightening to consider that outside of the GTA public
transit means buses almost exclusively, and buses need good
roads. Sixty Ontario municipalities have public bus systems and
1,100 communities are served by inter-city buses. There are 40
million passenger trips on 4,100 transit buses and 1,500 highway
coaches every year. Without good, safe roads, public transit
doesn't work.
SuperBuild was established
to manage Ontario's infrastructure planning and investments. A
large part of SuperBuild's mandate is to leverage private sector
money to provide that infrastructure. We believe the private
sector is ready for that challenge in providing some of the new
highways Ontario needs, but there is some fundamental direction
required from the government, and we must get on with the
job.
The mid-peninsula highway, for example, was needed
yesterday, and if we decided to build it right this minute, there
still wouldn't be shovels in the ground for several years yet.
There are needs assessments, environmental assessments and land
acquisitions to be undertaken, and I think some discussions that
our organization had with SuperBuild over the past year have
established that these are functions for which the government
must retain responsibility.
The private sector will
build the highways of the future where a reasonable return can be
projected, but the government must initiate it. We are already
far behind in the task of providing adequate highway capacity and
it's imperative that we move now with the decisions necessary to
ensure that no more time is wasted. I would caution that not all
highways of the future will be appropriate for public-private
partnerships, and governments cannot expect that this solution
will address all of Ontario's requirements for new roads.
The second subject I would
like to touch on today is Ontario's municipal roads, which
account for a full 90% of the province's roads inventory. There
is, or should be, a growing concern about the lack of investment
by some municipalities and the implications that has for economic
growth and public safety in the province.
Municipalities are now
completely responsible for funding of the local roads from their
property tax base. Some of them believe the province has left
them holding the bag and have not accepted this responsibility,
and others simply put roads investment at the bottom of their
priority list at budget time because it's easier to do than
raising taxes. There are some municipalities, especially in
northern Ontario, that legitimately cannot bear the full
responsibility because geography and development patterns have
left them with a greater need for more roads and too thin a tax
base to support them.
Notwithstanding that
municipalities now have the responsibility for funding their
local roads, we believe that the provincial government also has a
responsibility to ensure that our municipal roads systems
adequately serve the collective interest. This interest is
economic because our roads are all part of a network, and if one
part is broken, the system cannot work properly. It is also a
matter of public safety, and that is a provincial responsibility.
Our municipal bridges are a good example. They are supposed to be
inspected every year but in many, and I'd say most, cases this is
not happening. We know that some, maybe many, are inadequate and
well beyond the stage in their lifetimes that repair is
necessary. Are we going to wait until one collapses during a rush
hour before we move to ensure that our municipal bridges are
safe?
A couple of years ago we
suggested to this committee a dual-purpose strategy that we still
think is a good idea. We suggested that a level of funding be
established as something of an infrastructure emergency fund,
which would be available to municipalities that could demonstrate
hardship and a real problem with maintaining their local roads.
This would require some level of financial commitment from the
provincial government, but it would solve two problems at the
same time. In order to be eligible for funds from the program, a
municipality would have to demonstrate need, and to do that they
would have to undertake a program of monitoring the condition of
their roads and bridges.
1040
I don't think too many
people realize that, in many cases, this isn't happening any
more. We have no way of even knowing the condition of roads and
bridges in municipalities that are no longer making those types
of assessments. This is convenient in that if you don't know
there is a problem, you don't have to fix it, but it should be
seen as unacceptable in a sophisticated province like Ontario to
bury our heads in the sand when it comes to 90% of our road
system.
Whether the province looks
at our idea for a special fund triggered by demonstrated need or
some other initiative to address this situation, we believe that
this government must show leadership in ensuring that our
municipal roads and bridges are not allowed to crumble due to
neglect.
We also think the
public-private partnership model has tremendous potential for
generating new funding for municipal roads and bridges, and we
urge the government, through SuperBuild, to initiate the dialogue
that will produce the innovative approaches and new ideas that
will make this happen.
The final subject I would
like to touch on with you today is that of the need for a
longer-term approach to capital planning for provincial highways.
Late in 1999 our association delivered to the government a report
that indicated the potential for some $65 million in increased
efficiencies through a multi-year capital planning process and by
calling road work earlier in the year.
Currently, capital budgets
for provincial highways are established annually. Until the
budget comes down in April or May, there is little indication of
that year's funding commitments. The road-building industry
cannot apply proper business planning tools, and this extracts a
huge price in terms of productivity and efficiency, a price that
is invariably passed on to the government owner and eventually
the taxpayer. It is one of the few industries I can think of that
has to re-create itself every year, not able to properly plan
investment in plant, equipment and human resources.
We are not looking for more
money here, just some upfront planning that would benefit Ontario
taxpayers and our industry. We recognize that the provincial
budget is the main tool for setting fiscal policy, but we have
also suggested that there will always be a baseline portion of
the annual program that can be established upfront, so why aren't
we doing it? Given an annual baseline funding level projected out
over several years, the Ministry of Transportation would be in a
position to better plan its flow of work. The ministry could
start tendering work in January and February of the year instead
of June and July, and an industry that now does most of its work
in about a six-month
construction season could be working nine months of the year.
This makes so much business
sense to us that, quite frankly, we can't understand why it is
not happening. Everyone we have spoken to at all levels of
government acknowledges the common sense of what we're saying.
Everyone we talk to in government agrees that it makes good
business sense, that it saves the taxpayer money and that it
builds a stronger road-building industry. But it isn't happening
and nobody can tell us why. Year after year we're told, "Yes,
we're going to move in that direction," and year after year it
doesn't happen.
This is not rocket science
or some revolutionary way of handling the government's finances.
Pick a number: $500 million, $400 million or whatever a
comfortable number is for the government to work with, and then
get that amount of work out earlier in the year and our industry
will deliver the benefits in terms of cost savings and quality of
work.
Admittedly, last year the
government did, for the first time, make some progress in this
area. We got more work out between January and April 2000 than
was tendered in that period for many years previously. The
industry was encouraged and was able to squeeze more out of an
already short construction season. If this were to continue year
over year, the province would begin to see the types of cost
efficiencies and productivity that our report indicated. But this
year we have gone back to our old ways again, and our industry is
waiting until April or May, or whenever the budget comes down,
before it knows how many people to hire, how many trucks to line
up, how much stone to stockpile etc. By addressing this issue,
the government can realize better utilization of tax dollars.
Thank you, ladies and
gentlemen of the committee, for your time and your attention. Our
association, as always, looks forward to continuing to work with
your government to ensure that Ontario's road system delivers
economic benefits, optimizes public safety and contributes to the
quality of life for Ontario citizens. I'd be pleased to answer
any questions you might have.
The Chair:
Thank you very much. We have three minutes per caucus.
Mr
Christopherson: Thank you for an excellent presentation;
it was very concise. You hit on three very important areas and
made a good, concrete recommendation. So all in all, it was a
very good presentation; thank you. I'll try to make comments and
ask a question on each of the three areas and leave it to you to
respond to whichever part you'd like.
I'm from Hamilton, the
heart of the Golden Horseshoe. If anybody knows about what it's
like on the QEW between Toronto and Hamilton, it's me and any of
the other members who are in the Hamilton area. The difference
between now and when I was first elected in 1990 is so stark
you'd think you were in a different province; it's that
dramatic.
What I wanted to ask is,
when most of us think about major urban centres around the world,
congestion sort of goes with it. A number of thoughts come to
mind, and that's one of them. I wondered if you could give us an
example of a world-class, world-level city comparable to Toronto
that has come up with either an innovative way or a clearly
different approach that, in your opinion, has worked.
Secondly, on the municipal
road structure, I'm glad you're raising this early. It's not the
first time. There are a number of other areas that municipalities
have been given responsibility for, social housing being another
prime example, where, because of the fiscal pressures on
municipalities, some-let's be fair-are either not going to make
the right choices for the long term or, because of fiscal
pressures, will have no other choice but to make decisions that
are only in the short-term, maybe medium-term interest of their
community, but not the longer-term.
But when you talk about
things like roads-and I'm glad you raised the point-you can't
just say it's a municipal problem confined to that municipality.
Everything is interconnected. Already, because of that
differential, because different municipalities are going to see
and have the fiscal ability to deal with their road
infrastructure problems differently, we could have problems in
terms of the overall Ontario transportation network. Right away,
we're seeing you recommend that there be some kind of fund that's
triggered after certain thresholds are crossed. But at the end of
the day, it brings the province right back into an area that they
were trying to get out of. Do you know what? At the end of the
day, I don't think they'll ever be able to completely separate
them without running the risk that various points in the
transportation network are going to be problematic, affect other
financial centres and quality-of-life centres, and no one will
have anything to say about it because it's strictly a municipal
jurisdiction.
On the last item you
raised, our government's probably just as guilty as this one. I
didn't hear you point to any of us in the past who did a
magnificent job of getting those numbers signalled to you early.
So I'm wondering-I'm assuming it's not a political thing but it's
a structural thing-what kind of answers do you get from the
Ministry of Transportation, other than the obvious, "We have to
coordinate the budget all at once," when you raise this issue
about signalling ahead of time so that you can get your ducks in
order?
Mr
Bradford: You've touched on three areas there. I'm not
going to be overly helpful today on the first area. I think you
raise a good point. Our association should get busy and do some
homework and deliver to you some research on other major urban
centres that perhaps have found better solutions. Unfortunately,
I'm not prepared to give you those answers today.
On the subject of municipal
roads, this is obviously a very touchy political issue. The
responsibility for municipal roads has been passed on to
municipalities. That's what we're telling municipalities. We're
telling them to take that responsibility to heart. But, as I
pointed out in our presentation, I think the province has a
responsibility to look down from the top of the thing and say,
"Is this working overall? Is it serving our purposes?" That may
in fact require some
money to ensure that where it isn't happening properly and where
legitimately a municipality cannot meet that responsibility,
possibly the provincial government's got to intervene and provide
some assistance.
1050
On your third question, I
think the Ministry of Transportation is on our side on this one.
We've got a new minister; I don't know how he feels about it. But
right up to the ministerial level, this stuff about getting work
out early makes sense. What are we being told? We're being told
that it's all housed within the office of the finance minister.
As I pointed out, nobody's giving us any answers about why this
can't happen. Everybody says, "Yes, we're going to do that." It
makes a lot of sense, but it just doesn't happen. I don't know
why, and nobody's given us good answers to that.
Mr
Christopherson: Thank you for your presentation.
Mr John O'Toole
(Durham): I'd like to share a little bit of time with Mr
Arnott, but I just want to start by saying thank you for your
information. I appreciate that and the acknowledgement. I think
you've stated quite fairly that the government is trying to look
at the infrastructure, specifically, in your case, the roads.
Clearly, it is an issue, as you described, of safety and economy.
I drive the roads every day from Durham.
Just on the municipal part,
having served there for a couple of terms, I'm quite familiar
with the whole look at, through the Fair Tax Commission and other
ways, who funds what. There were always conditional and
unconditional grants. Roads have a lifetime, and there should be
an easy planning tool there for municipalities. I'm sure you
could give them-and the Premier is speaking currently about the
whole issue of smart growth: the use of public transit. We're
also hearing the position of the chamber on a transportation
authority of some sort. I think there's a lot of attention being
paid to the impact generally on the economy, but making the right
choices and long-term planning.
I have one specific
question, though. I look at the 401 as sort of the artery of our
economy, to a large extent, and there's not one nickel of federal
money involved. There's $2 billion or more in revenue that comes
from them. They need to be part of that solution, both in the
public transit equation as well as the equation for our highways.
You can comment on that, if you wish. If you think not, I want to
hear your views, not mine.
The other part of the
question is, looking at the longer term-longer-term capital
planning is right on our government's agenda. That's what we do
best, in my view, and clearly, from your opening statement, we're
moving in that direction; SuperBuild is supposed to be doing
that. What about the whole use of the current technology: the
asphalt-versus-concrete equation? That's an important issue of
investment. Do you believe that the current technologies for
building highways are the right investments, or should we be
looking at concrete as low-maintenance, if you take a 10- or
15-year window on maintenance, plus initial capital? Should we be
giving that serious consideration: concrete on our highways?
Mr
Bradford: I'll respond to both of the points you made.
Yes, certainly, if I weren't here today, I'd be in Ottawa making
the same points. It's an absolute travesty how the federal
government refuses to take any responsibility. Yes, they have a
huge responsibility to our national highway system. They are not
living up to it and we're telling them that regularly. But please
don't take that as a reason for the province to say, "The feds
aren't giving us any money. They should be," so nothing's
happening. We do have a responsibility, but you're quite right:
the federal government has a responsibility.
On this whole thing about
asphalt and concrete, it's the kiss of death for me to start
talking about which is better. We are calling some trial projects
this year where some life cycle costing considerations have been
taken into account. All I can say is I guess we're going to see,
in a very short period of time, which delivers the best benefits
to the taxpayer.
Mr
O'Toole: I think Mr Arnott has a question.
The Chair:
In view of the time, I have to go to the official opposition.
Mr Monte Kwinter
(York Centre): Thank you very much for your
presentation. I don't think anybody in this province denies the
benefits of having a good road system. It's a given. I don't
think you'll find anybody who will have a different opinion. The
big problem is, how do you finance it? That's why we see Highway
407. I noticed there was a report today that the use of that
highway has exceeded their expectations. They're making money and
they're going to expand it.
The problem we have-and I
think it answers your question why there isn't an earlier
indication of what the budget is going to be. All you had to do
was see the reports of the cabinet meeting yesterday. We are
going into a downturn. How serious that is depends on where you
come from, but certainly it's relatively pessimistic. The Premier
has gone on record as saying the only areas that are going to get
any increased funding, as far as he can see, are health care and
education. He's going to be calling on every other ministry to
hold the line or cut, otherwise there's no way they can keep to
their fiscal plan. He said that very emphatically. If you talk to
the people at the Ministry of Transportation, they'll say, "We
can't give you a figure because we don't know the figure. We
don't know what envelope we're going to have to spend." That's
unfortunate, from your point of view. I understand that.
I'd like to ask you about
the issue you raise, and I think it's a valid one, that these
private-public partnerships can't work everywhere. You get an
area like the GTA, where there's lots of traffic, and you can
make a business plan: if I build a highway and I get so much
traffic and I charge so much on a toll basis, we can make money.
I can get investment to build it, and that's what happens. With
some of these other projects, particularly in the north in
sparsely populated areas, you can't make that business plan. As a
result, there's no one who will build them because they may never recoup their
costs. So there is a role to play. Do you have a comment on
that?
Mr
Bradford: I don't know that you've asked me a question,
Mr Kwinter.
Mr
Kwinter: The question I'm asking is, how do you finance
those highways-
Mr
Bradford: Where there is no rationale for the private
sector or where there's no reasonable return on investment, I
think we've indicated it is a government responsibility. If we
need a new highway up north, you're quite right: the toll
revenues or whatever are not going to justify it. That's where we
see the provincial government having the responsibility to ensure
that the capacity is adequate.
The Chair:
With that, Mr Kwinter, we've used all our time. On behalf of the
committee, thank you very much for your presentation this
morning.
ONTARIO FEDERATION OF LABOUR
The Chair:
Our next presentation is from the Ontario Federation of Labour. I
would ask the presenters to come forward and state your names for
the record. On behalf of the committee, welcome.
Mr Wayne
Samuelson: Wayne Samuelson. I'm president of the Ontario
Federation of Labour. With me is Ross McClellan from federation
staff.
Let me begin by saying it's
always a pleasure to come to this committee. It's one of the few
committees we actually get to go and say something to with this
government. While the Premier certainly doesn't seem to elevate
any of you people to cabinet, it's always a pleasure to see you
here and talk with you, although I'm surprised by it, and I'm
sure at least one of you will be gone next year.
I am pleased once again to
present a pre-budget submission to the standing committee on
finance on behalf of the 600,000 members of the Ontario
Federation of Labour. Once again we feel it is necessary to
inject a note of caution and concern into these proceedings,
marked as they are by the vigorous, self-congratulatory
back-patting of the Treasurer and his government supporters. Our
concern is caused by the threat made by the Premier, and repeated
by the new Minister of Finance, to engage in yet another round of
tax cuts.
I want to focus on the
issue of tax cuts. We've provided some up-to-date material for
the committee on recent labour market trends in wage settlements
from collective bargaining and job creation, which I'm sure
you'll find helpful, but I want to focus on tax cuts in the
context of the economic slowdown, which has already arrived.
1100
The American economy is
finally emerging from one of the most remarkable periods of
sustained growth in its entire history. After going into a sharp
recession in 1989, the US economy recovered rapidly and produced
more than a decade of spectacular economic growth with virtually
full employment. Not only that, the Americans managed to wipe out
their deficit. They also generated a fiscal dividend in the form
of budgetary surpluses that now exceed $1 trillion. Canadians
could only watch in amazement while the two candidates for the US
presidency debated one single issue during last fall's US
election: how best to spend that fiscal dividend, the tangible
legacy of one of the strongest periods of economic growth at any
time in our history.
It's worth pointing out
that the superboom in the US economy had nothing at all to do
with the Harris Common Sense Revolution mantra of "Tax cuts, tax
cuts, tax cuts." It's a very inconvenient fact that President
Clinton actually increased taxes in order to pay down that huge
US deficit.
The second fact that lies
at the centre of the American economic miracle is that American
monetary policy has been based firmly and fundamentally on
keeping interest rates low. It is this low interest rate policy,
adjusted regularly by the US Federal Reserve, that created the
rapid recovery in the early 1990s and sustained US growth through
the rest of the decade. This growth, we repeat, took place during
a time when taxes were actually raised.
When we compare the
American experience with our own, the result is not only sad,
it's also depressing. We really do not have much reason to sing
along with the government's Hallelujah Chorus. The Bank of Canada
pursued a high interest rate policy from 1989 until 1996, exactly
opposite to the US. The result was a made-in-Canada recession
that lasted eight miserable years. Now we have every reason to
fear that both Canada and the US are heading into yet another
recession. Despite the economic growth that Ontario has enjoyed
since 1997, we need to remember that the Canadian economic
recovery had less than half the lifespan of the American economic
boom. Unlike the Americans, who have enjoyed 10 years of vigorous
economic growth, Ontario has had only four consecutive years of
real economic growth, from 1997 to 2000.
The truth is, the first two
years of the Common Sense Revolution were so bad in economic
terms that they totally wiped out the recovery that had started
in 1994, when real growth was 5.9%. The 1994 recovery was
followed by the plunge in 1995 down to 3.7%, and the GDP growth
collapsed in 1996 to a miserable 1.1%. Not until 1999 did Ontario
return to and surpass the level of growth achieved in 1994. Now,
after just two years of very high growth, the forecasts for 2001
are dropping like a stone from week to week. So the orgy of
self-congratulation and back-slapping is hardly justified;
neither is the mindless optimism.
We listened carefully to
the optimistic predictions from officials of the Ministry of
Finance the other day. We would remind the committee this is the
same ministry which predicted that the 1989 budget of the
province was in balance with a $3-million surplus, until it
disappeared on election day in 1990. It's the same ministry that
predicted in 1989 that the recession would be short-term and of
insignificant duration. A little bit of humility might seem to be
warranted here.
I want to stress again the fact that the
restructuring of the Ontario economy which followed the free
trade deal and NAFTA has turned the Ontario economy into one that
has a fundamental dependency on export trade. Ontario's
prosperity is tied directly to our ability to export, and 93.5%
of Ontario's exports go to the US. Despite the head-in-the-sand
denial of the Treasurer, who comes from the Oshawa area, of all
places, Ontario's export trade is fundamentally based on the auto
sector. To deny this is utter folly.
One Ontario job in six
depends on the auto sector and its myriad suppliers in steel,
plastics, glass and all the processing and manufacturing concerns
that funnel their products into Ontario's auto industry stream.
Motor vehicles, parts and accessories accounted for over $80
billion in export trade in 1999 and were fully 41% of all
Ontario's exports. Anything-and I repeat-anything that threatens
the auto sector in this province is a huge threat to our standard
of living. As everyone in Ontario knows, with the seeming
exception of the Minster of Finance and his ministry, the auto
sector in Ontario has been hit with the worst blows in over 25
years, with a real likelihood of more bad news to come. The US
market for our auto exports has collapsed. Combine this with the
end of the auto pact, and the discombobulation that has hit
Chrysler Canada with the failure of the merger with Daimler, and
it adds up to real trouble for the cornerstone of the Ontario
economy.
The auto sector is not the
only trouble spot. We are monitoring significant layoffs in
steel, communications-Nortel's bad news coming just last week-and
we're also starting to see some stall in the construction sector.
The signs are all there for a significant downturn and it's
already starting. There is every reason to assume we are once
again entering a period of recession and therefore we should be
planning for that contingency. We're all wondering is, how bad
will it be?
The very last thing Ontario
needs is more tax cuts. Let us remember the 1994 promise before
the first round of Common Sense Revolution tax cuts. Let's
remember those promises: no cuts to education and health care. We
all know what those promises are worth. We fully realize that
behind every tax cut lie spending cuts and that every spending
cut translates into layoffs of public sector workers. It's
absolute folly to compound private sector layoffs that are now
taking place with another round of pink slips for public
employees. That is a sure way to compound the recession and
increase the amount of misery.
There is of course a real
alternative to tax cuts. That alternative actually has worked to
get both Canada and the US out of recession, and that's a low
interest rate policy. Not only that, but low interest rates are
worth more real money to working people than the across-the-board
tax cuts we've been getting. Income tax cuts put most of the
money into the hands of the wealthiest people who pay the most
taxes. Every point off the interest rate generates huge cash
savings for working people, and that helps to pull us out of
recessions. Instead of lecturing and hectoring the federal
Minister of Finance about more tax cuts, as he's been doing,
Ontario's Treasurer should be speaking out in support of a low
interest rate policy, and he should be praying that the US
federal reserve is once again able to set an interest rate policy
that will sustain the US economic miracle into the future.
Another round of tax cuts in the context of economic slowdown or
recession will simply finish off the first job of wrecking what
is left of our public health and education systems and do much
more damage besides that.
Health care: Further cuts
to Ontario's health care system cannot be sustained after the
craziness of the last five years. The massive reinvestment of the
past two years has been completely unable to repair the damage of
the first three years of the Common Sense Revolution and its
assault on our hospitals. Further cuts will simply provide the
final excuse to introduce a two-tier medical system. If that
happens, it is inevitable that the new costs of pay-as-you-go
medicine and health care will be placed on bargaining tables
across this province, and you can kiss goodbye the competitive
edge that our medicare system gives to Ontario industry. The auto
sector alone enjoys a $6-per-hour cost saving over our American
competition.
A second round of
tax-cut-driven spending cuts will push post-secondary education
over the cliff. Somebody will have to explain to me and the
people we represent how cuts to education help prepare our young
men and women for what everybody calls the knowledge economy. We
do not need tax cuts. We need more tax-financed investment in
post-secondary learning as a matter of simple economic survival.
We urgently need public investment in learning for the early
years to ensure that no child in Ontario is left behind in the
knowledge economy. What we do not need is more tax cuts.
It's interesting that the
person before me spoke about capital investment, because I also
want to highlight that: capital investment in roads and transit.
Ontario's capital spending has been decimated to pay for the
first round of tax cuts. As a result, our transportation
infrastructure is falling further and further behind the pace of
urban and interurban development, especially in the GTA. I've
included some charts that talk about the capital deficit in roads
and transit.
Ontario's GO Transit
system, once at the forefront of commuter transit, has been
allowed to decline and languish. Its park-and-ride facilities are
now so inadequate that service expansion is impossible. Its
user-hostile scheduling and crazy mix of bus and train service is
a jumble that's impossible to understand. It is completely
unintegrated with the TTC and other urban transit systems. What
is urgently needed is a massive public investment to turn GO
Transit into a modern, integrated, people-moving service right
across the GTA and to do the same in other major economic centres
of the province. This just will not happen if we continue to cut
and cut taxes.
1110
In an era of just-in-time
inventory, it's a recipe for economic disaster to continue to
allow gridlock on Ontario roads and highways and to completely
ignore the creation of an integrated public mass transit system
across the GTA to ease the current massive congestion. You'll
notice that in the US our American competitors have invested
billions in highway modernization, while Canada continues to
squander its resources on tax cuts. We may just wake up to find
that those industries which need just-in-time delivery have gone
to a jurisdiction where their deliveries are not stuck in
perpetual traffic jams.
Housing: No other policy of
the current government has been as much of a disaster as its
housing policy. By relying exclusively on private market forces
to supply affordable housing and by totally deregulating the
private sector market, this government has created a housing
disaster of world-class proportions. The eradication of rent
control has led to a new wave of economic evictions across the
province but nowhere as dramatic as here in Toronto. The
fastest-growing group of homeless people now is children whose
parents cannot find an affordable home. We have over 6,000
homeless children living in shelters. Homeless people are dying
of exposure at the rate of one a week this winter in Toronto.
Conditions that used to be confined to the Third World are now
commonplace on many of our streets here in Ontario.
This is a good time to
remember why it was that government got into the housing supply
business in the first place; it is because the private market has
been absolutely incapable of providing affordable housing since
the late 1960s. It was the crisis of housing supply in the early
1970s that forced the Davis government to introduce rent controls
in 1975. Every subsequent government recognized the need to
protect low- and modest-income Canadians from the threat of
economic eviction and homelessness, except this one.
After five years of
decontrolled rental housing and the enactment of the entire wish
list of the private development industry, the Minister of
Municipal Affairs is reduced to ranting and raving at builders
and developers for their failure to build affordable rental
housing. We are now back at the beginning, where we were in the
1970s, except the situation is worse. Given the basic unchanging
and unchangeable reality that the private sector cannot and will
not build affordable rental housing, the only solution is to
re-establish a provincial housing supply program. We believe the
disgrace of homeless men, women and children will continue to
bring shame on this province until once again we assume
responsibility and get back into the housing business by
supporting the construction of municipal non-profit and
co-operative housing.
Before I go on, let me just
take a second to point to this ad. I know the government members
here aren't responsible for some of the silly things their
government does, but placing this ad in the commuter newspaper-I
don't know if you've seen this-so homeless people have a number
to call in Toronto to find someplace to sleep is not an answer to
dealing with homelessness. This is the most insulting example of
a waste of government money I have ever seen. If you want to deal
with the issue of homelessness and people dying on the streets,
then you should deal with it and not try to cover it up with
advertising campaigns like I've seen in the papers this week.
Finally, I want to make a
plea to this committee to put a measure of compassion back on the
province's fiscal agenda. The outgoing Treasurer spoke often
about compassionate conservatism, but there's certainly little to
show for it. One thing that needs to be done is to increase
social assistance rates for the poorest of the poor, who have not
had a raise in their income in 10 years and who have actually
suffered a 30% reduction in their standard of living since 1995.
Ontario's workfare program, which forces the poor to work for a
welfare cheque instead of a paycheque, should be replaced with a
fair work program that provides decent jobs with decent pay and
the protection of Ontario's labour laws.
I'm going to ask Ross to
give you a brief summary of the appendices which deal with wage
settlements, jobs and the economy.
Mr Ross
McClellan: Very quickly, as we always do, we've provided
the most recent data on wage settlements from collective
bargaining in Ontario. I apologize that some of the charts are
illegible. I've included an insert. Our scanner was on the fritz
yesterday and we weren't able to produce the quality we would
have liked.
Collective bargaining wage
settlements over the last three years have averaged 2.1% a year.
That breaks down into 1.8% per year averaged over the last three
years in the public sector and 2.6% in the private sector. During
the same period of time, the consumer price index has averaged an
annual increase of 2.5%. The most recent number from Stats
Canada, which is a bit concerning, is that the year-over-year
increase in the CPI in January was 3.6%. It's obviously being
driven by increasing energy prices that are up, during that
period, 10.6%.
My point is that wages have
nothing to do with whatever is happening to the CPI. Wage
settlements from collective bargaining are running below
inflation, and that's important in terms of interest-rate policy,
as you know. If you accept our president's recommendation that
interest rates are the key factor, there's no justification for
concern that wages are driving inflation. Wages are behind
inflation, especially in the public sector. Any wealth that's
being generated by the so-called economic boom is sure not being
shared by working people, because their wages are falling behind
and they're not catching up. They're falling further behind.
Just a quick note on job
creation. It's useful for the committee to look at the graphs on
the final page. There's a lot of hype about all the jobs that
have been created since 1995 in this recovery. Most of them have
been created since 1997. A third of them are part-time jobs. You
need to keep this in mind. When we look at these job numbers and
all the back-patting and self-congratulation, a third of the job
growth is in part-time jobs. Then, when you get behind that even
further, you discover that, even conceding that some of the
self-employment jobs are
part-time jobs-and I don't think they are-the most conservative
estimate is that 28% of the new jobs that have been created in
Ontario are self-employment. I think that's probably a higher
number, because I assume most of the self-employment jobs are
actually full-time jobs. If you calculate it on that basis, it
would be closer to 40% of the new jobs created since 1995, but
I'm being conservative, because it's a Conservative government,
and 28% of the jobs are self-employment. Half of those are
self-employed individuals with no employees, in other words,
people who are trying to sell Amway and are sitting in their
basements staring at their computers waiting for the phone to
ring, people who have been displaced from good jobs and are
struggling to survive. Those numbers tell us that we're still
producing a lot of bad jobs along with the good jobs that are
being produced in this province.
The Chair:
Thank you very much. We have two minutes per caucus, and I'll
start with the government side.
Mr
O'Toole: It's good to see you again, Wayne. I'm
confident the Minister of Finance, Mr Flaherty, whom you made
reference to, will be quite concerned in representing the auto
sector. Certainly I am. I hope there's a job for me there two
elections from now.
Mr Joseph Cordiano
(York South-Weston): You'll be in the cabinet, John.
Mr
O'Toole: That's right. I'll certainly be upset if I'm
not. I do appreciate your sense of humour, but I also want to
make sure I note that I'm always available and I do meet-whether
it's the construction side or whatever. To leave an impression
that we're not listening is absolutely wrong, but there are
always two sides to the equation.
I want to focus on the
tax-cut issue a small bit, as it dominated a fair amount of your
presentation. Before I get to that, though, I want to talk a
little bit about the monetary issue. I don't disagree with you. I
firmly believe that interest and interest manipulation is
supposed to control demand. Obviously, increased interest reduces
demand.
1120
I could make the same
argument for tax policy too. There is a clear relationship,
especially in the lower-income groups-those people under $40,000
or $30,000 spend a larger part of their disposable income-and if
you increase that disposable income, either through interest, ie,
lowering your mortgage and therefore you have more money to spend
on heating the house or whatever, they're going to spend it. My
argument is, like the interest argument-I believe we should have
low interest, I really do. Clearly, Alan Greenspan has made that
the monetary policy in the States, and I think the Bank of Canada
will follow suit, probably in March, and lower it a point or a
half point.
That being said, the
analogy I'd like you to respond to is, if you lower taxes, it's
the same thing. I have evidence here, Wayne, that would show you
that our tax changes to a working family-that's two people
working, each making $30,000 a year-amounts to something like
$1,700 of increased disposable income. That increased disposable
income, to some extent, was clawed back by the federal
government. They increased the CPP, they increased the EI
deductions and they increased and didn't change marginal tax
rates.
The Chair:
You've got one minute left, Mr O'Toole.
Mr
O'Toole: Don't you support lower interest? Yes. Don't
you support lower taxes? Your employees, that's their income
you're talking about.
Mr
Samuelson: You should make a similar pitch to the
Minister of Finance, that stuff about low-income people spending
their money, because maybe then he would quit giving huge tax
breaks to people who already have a whole lot of money, which is
exactly what your tax break regime does. You know that and
everybody knows that. So you should make the pitch to your
colleague in the Oshawa area, who, I should note, had the job for
three hours and lowered the projections by about half a
point.
Mr
O'Toole: Very responsive.
Mr
Samuelson: Very responsive. We've got a lot to worry
about.
The issue of tax relief
can't be dealt with without looking at what the impact is. I feel
it with my kids, who are in the school system and, if you're
being honest, you do too. We certainly know what it's doing to
our health care system. You can't simply deal with these huge
amounts of money you're giving to people who already have lots
when what it means to most of us when we try to go into an
emergency ward is that we're told, "Sorry, we're closed. You'll
have to go down the street somewhere."
With all due respect,
that's the context in which we try to approach the issue of tax
cuts and tax policy.
The Chair:
Mr Cordiano?
Mr
Cordiano: Thanks for your presentation. I think it's
very thorough and thoughtful. Given that we're seeing an
impending slowdown in the economy, the Premier's response
yesterday-my colleague Mr Kwinter pointed this out to me-coming
out of a cabinet meeting, his immediate reaction was to suggest
that there will be further cuts to the public sector and that
every ministry is being told to hold the line. So there is going
to be a freeze on any additional spending and further cuts, at
best. That implies we're not going to see any of the types of
investments that you're calling for in capital expenditures,
housing, social assistance, health care or education.
Further to that, with the
downloading of most of these responsibilities on to
municipalities-for example, roads, public transit, housing,
social assistance-and I suppose there will be additional
pressures on municipalities to increase property taxes as a
result of some of these additional burdens that have been placed
on them, how are we going to respond in the midst of an economic
slowdown to invest in some of these areas that you're calling
upon the province to invest in? Where is this additional money
going to come from? Is it going to come from what you've
suggested should be a freeze in additional tax cuts?
The recovery isn't going to happen for some time,
so the revenue base for the province is going to slow down. I'm
just wondering how it is that the province would continue to fund
particularly health care, which still remains a provincial
responsibility, and education.
Mr
Samuelson: Even without the context of an economic
downturn-again, we all have different views on how serious it's
going to be-clearly the government is positioning itself to get
rid of a lot of these services. You read in the paper today that
they want to privatize. They want to give their friends our
health care system. I think they're in trouble to start with; I
think we're all in trouble. I can't imagine what's going to
happen if we enter an economic downturn like, on a personal
level, I fear.
I worked in the early 1980s
every day in a plant that was dependent on the auto industry. I
was a municipal politician in a community that was dependent on
the auto industry. Let me tell you that when it comes, it comes
very fast. Plants that employed 3,000 people within months were
down to 700 and 600 and then it rippled through the economy. If
the government wants to bury its head in the sand and say, "This
is not something we have to worry about. Everything's going to be
fine"-they put themselves at some political risk. But I'll tell
you, they put the rest of us, a lot of people, at a big risk in
terms of providing for our families. I can remember well people
who had worked for years who were not only approaching our
welfare system and food banks but facing challenges they never
thought they'd expect. When I look at the numbers I see in terms
of layoffs in the auto sector, they are the kinds of things we
saw in the early 1980s.
The Chair:
Mr Christopherson.
Mr
Christopherson: Thank you, Wayne and Ross. I'm glad you
took at least a moment to recognize the fact you don't get in
here very often on those major pieces of legislation, like the
Employment Standards Act, that are just steamrollered through the
House with no opportunity. Whenever the government members say to
people, "Gee, we're really glad to have you in here. We like to
hear from people. It's really important," it's very selective.
There are a lot of things they don't want to hear from anybody
and they've made sure they haven't. So I'm glad you raised
that.
Obviously, the focus for
you today is tax cuts and urging the government not to go down
that road. I think the signal this morning from the Premier
indicates they're not prepared to back off the accelerator in
terms of tax cuts, even though as experts have come in-you talk
about how quickly things change. Even in the last couple of
weeks, some of the economists coming forward have been dampening
their enthusiasm for tax cuts. Even yesterday, a gentleman from
Nesbitt Burns came in. I don't want to put words in his mouth,
but he was cautioning that they ought not to do the tax cuts
right away. He was still committed to them, but he was saying to
back off a bit. In the morning we had looked at a presentation
that Hugh Mackenzie made that pointed to the fact that there was
only one scenario that kept us out of deficit, and that was to
back off the tax cuts, and if we were lucky enough we'd have a
soft landing; if those two things happen, then we'd stay out of
deficit.
Every other scenario says
we're going under and, based on what the Premier is saying today,
clearly they're not going to take their foot off the accelerator.
If we get a further downturn, worse than what's being projected,
and they're being revised constantly, almost daily, we're going
to see a real crunch. The people who came in here at the
beginning of this process a couple of weeks ago, who thought they
were debating where we ought to go with a $1-billion surplus as a
starting point, are going to find that we're worse off than we
were a number of years ago.
I want to ask you directly
about the tax cuts and kitchen table economics, because that's
where things really matter in this province. It's my sense that
it has taken a long time, but a lot of people who voted for this
government because they thought they were going to get big tax
cuts, which you've pointed out the vast majority of the middle
class don't get, have begun to recognize-even the skilled trades
auto workers with all the overtime. That's who's pointed to as
the people in the blue-collar world who still voted for the
Tories, and they did get back in. My sense is that people are
finally beginning to make the connection that all the other
things they're worried about-when they're watching tuition fees
go up, the hospital closures, the schools aren't sufficient, all
those things happening-they're beginning to realize there's a
link between those cuts in circumstances and the cost on their
quality of life and the argument that tax cuts are the way to go
for the future. What's your experience? What are you hearing
across the province as you move around from community to
community?
1130
Mr
Samuelson: I think, Dave, you've characterized it very
well. I was on a phone-in show in Thunder Bay and this woman
called in. She said her son was in grade 5 and that he used to
get help with his schooling because he was challenged. She said
her son no longer gets the help. Then she said, and these are
important words, "My son will suffer because of this every day
for the rest of his life."
I think these kinds of
impacts of tax cuts, whether it's writing an extra few hundred
dollars on a cheque for tuition or knowing that your child is not
going to get the help they need, or somebody you know doesn't
have access to a hospital or a shelter, those kinds of issues,
become real to people. It takes some time for these tax cuts to
work through the system, and I don't think there's any doubt that
people in Ontario are starting to see what it means. I'm very
fearful of what will happen in the future.
Just before I leave, and I
know you're about to cut me off, you all have name tags. I've
included here a list of some of the circumstances around the
people who died on the streets of this city and this province in
the last year or so. I'd just like to leave it with you so that
you have a sense of what it means. Maybe you can talk to whoever
is wasting your money on
these ads and try and do something to really help people so they
don't die on the streets of our cities.
The Chair:
With that, I have to bring it to an end. On behalf of the
committee, thank you very much for your presentation this
morning.
ONTARIO CATHOLIC SCHOOL TRUSTEES' ASSOCIATION
The Chair:
Our next presentation is from the Ontario Catholic School
Trustees' Association. I would ask the presenters to come forward
and state their names for the record. On behalf of the committee,
welcome.
Mrs Louise
Ervin: Good morning. I'm Louise Ervin, president of the
Ontario Catholic School Trustees' Association. With me are
Patrick Slack, our executive director; Regis O'Connor, our past
president; and Carol Devine, our director of political affairs
and media relations. With us in the audience is John Stunt, who
is our incoming executive director. He will take over that
position on May 1.
The Ontario Catholic School
Trustees' Association, known as OCSTA, represents all 29 English
Catholic district school boards and five English Catholic school
authorities in the province. The association appreciates the
opportunity to speak to you on their behalf.
In the fall of 2000, OCSTA
prepared a brief on education finance, which is attached to our
document, and submitted it to the Minister of Education. The
brief was entitled Education Funding-Refinements and
Enhancements. Our presentation to the standing committee on
finance and economic affairs is based in large part on the
education finance brief. It reflects the experience of
English-language Catholic school boards following two full years
of implementation of the province's new education funding
model.
OCSTA and its member boards
share the government's goal of providing high-quality education
for Ontario students. We recognize, as does the government, that
education plays a central role in both the economic and social
development of our province. It is the route to economic growth
and prosperity in a society that is increasingly dependent on
knowledge and its application. High-quality education will help
to keep Ontario competitive in our global economy.
Education requires access
to resources of many kinds and the funding to secure these
resources. Ontario has been experiencing a robust period of
economic growth in recent years. Ontario's students must benefit
from this prosperity. Education must therefore have a high
priority in government spending.
OCSTA has long maintained
that to be accessible, the education funding system in Ontario
must respond to four essential principles: equity among all
Ontario school boards; flexibility and autonomy to address the
goals of the system and to meet local needs; accountability to
ensure efficient and effective use of educational resources for
students; and adequacy of resources in the funding system.
Mr Regis
O'Connor: Thank you, Madam President. Good morning,
ladies and gentlemen.
Positive steps have been
taken in meeting many of these standards. OCSTA acknowledges and
appreciates the actions of the government in establishing a fair
and equitable funding formula for Ontario's four publicly funded
school systems. All school boards are, as of this year,
theoretically on the same footing for the application of the
funding parameters. The initial and prolonged delay in
implementing equity in Toronto and Ottawa, and the impact of many
years of inadequate funding levels for the province's
assessment-poor boards, continue to create challenges.
OCSTA applauds the
minister's response to several recommendations made previously
regarding refinements to the funding formula. Catholic school
boards agree that responsible and accountable spending of
taxpayer dollars is essential, and they continue to seek
cost-effective ways to provide programs, services and
administration. The quality of students' educational experience,
however, must not be sacrificed in the search for cost
efficiencies. Adequacy of funding remains an issue. Allocations
to school boards within several areas of the new funding formula
must be increased in order to maintain the quality system of
elementary and secondary education in Ontario.
School boards must receive
adequate funding allocations that are responsive to a variety of
inflationary pressures. These include the following and,
gentlemen and ladies, there are only a few: increases in the
price of natural gas we see in the range of 30%; similar
anticipated increases in the cost of hydroelectricity; fuel
escalation clauses in boards' transportation contracts in the
range of 3%; a 5% increase in the cost of textbooks over the last
year; maintenance costs for technology in schools and board
offices up by more than 20%; increased Canada pension premiums at
double-digit rates over the past two years; increases in various
health and dental benefits from 15% to 50%; and the necessity of
fair wage increases for all our employee groups.
Mrs Ervin:
Another area where funding increases are needed is special
education. In 1999-2000, 21 Catholic boards found it necessary to
spend more than the funding formula allocated for special
education programs and services. Despite some increases for
2000-01, school boards report that funding remains inadequate to
meet students' needs. OCSTA supports the creation of the
minister's intensive support amount working group. We have
written to Minister Ecker, stating our general endorsement for
the working group's recent recommendations. In particular, we
agree with the critical need for stability in special education
funding; a formal process for clarification and refinement of ISA
criteria; the need for the early release of information to school
boards about funding allocations for special education;
provisions to recognize boards' increased costs for delivering
special education on an ongoing basis; a reduction in the administrative burden facing
school boards applying for ISA funds; the recommendation for
assistance for boards without access to professional assessments
required by the funding process.
OCSTA supports the need for
an equitable, comprehensive ISA claim process and for
accountability in spending. We are deeply concerned, however,
with the possibility that, for some boards, future ISA
allocations could fall below the level at which they are
presently being funded. If this were to occur, positive
adjustments to the special education allowance would be
imperative. The ongoing level of special education funding must
be adequate and sufficiently flexible to enable school boards to
meet the needs of our students.
Students with special needs
who enter or move between Ontario school boards, including new
kindergarten students, place legitimate funding responsibilities
on school boards. A year-long delay in a board's ability to
qualify for ISA finding for high-needs students is critical for
that board. Services must be provided for these students
immediately, therefore funding for these services is necessary
immediately. School boards must have access to an efficient
in-year process to fund the programs and the administration of
these programs for those students.
1140
Mr
O'Connor: Allocations must also increase in the funding
to support students who, because of a variety of socio-economic
and cultural factors, require special assistance. Some of the
most effective programs in this area address the educational
needs of our young children. Research, including the
Mustard-McCain report commissioned by the government in 1999,
confirms the importance of early childhood education in
determining a student's future success. Investment in early
childhood education is a wise use of education dollars. Early
childhood education is good for all children but particularly
necessary for those already disadvantaged by their economic or
social circumstances. Additional funds to strengthen this program
are needed.
Therefore our association,
OCSTA, strongly recommends that the education budgets for 2001-02
recognize and accommodate the inflationary and special-needs
pressures on school boards.
Mrs Ervin:
OCSTA appreciates the opportunity to present this brief to the
standing committee on finance and economic affairs. We again wish
to commend the government for its commitment to the
implementation of a student-focused, equitable model of education
funding. We believe that the success of a new model will depend
heavily on how well the overall amount of funding for education
in Ontario responds to cost increases and the changing needs of
students, schools and school boards.
The Chair:
Thank you very much. We have five minutes per caucus. I'll start
with the official opposition.
Mr
Kwinter: Thank you very much for your presentation. I'm
sure you heard that the elementary schoolteachers have settled
their problems and they are now going back to a full workload,
and in order to get that, they've agreed that there'll be a
reduction in the number of teachers. They then went on to say
that this reduction is OK because it's going to be done by
retirements and attrition.
I was disturbed by a
comment about that, saying it may require teachers who are in
special teaching situations like music and art and guidance to
move into the teaching role in order to accommodate these
reductions.
In your brief to us you
say, "The quality of students' educational experience, however,
must not be sacrificed in the search for cost-efficiencies." To
me, this announcement today goes directly to that issue, that
economies are going to be literally imposed on schools, but the
loser is going to be the quality of education. Do you have a
comment on that?
Mrs Ervin:
The situation you're bringing forward is specific to the Toronto
public board, and I really feel I shouldn't be commenting on
their collective agreement. To my knowledge, that has not
happened anywhere in our system, but I'm not familiar with the
intricacies or the decisions that have been made around each
collective agreement.
The fact remains that the
Catholic boards have been so far behind for so many years that we
have not had the luxury of having all these extra staff in our
systems. Our teachers have been teaching, and the positions that
did not require certified teachers did not have certified
teachers in those positions. So I don't think you would find that
kind of situation in our boards.
Mr
Kwinter: You've also stated in your brief that all the
boards, the four systems, are pretty well on a parity level.
Aren't you going to find that the pressures that apply to the
other boards are going to impinge on your particular board, now
that they're on an equal basis?
Mrs Ervin:
Regis may want to speak to that.
Mr
O'Connor: If I can use the analogy of a thermometer, the
public boards are up here and the Catholic boards are down here,
and we're trying to get to an equitable level. We're not there
yet; we're still a long way from it. You used the example of
music programs, and there are other programs in the school that
are in the same dilemma.
Teachers have tried over
the years, no matter what panel they belong to, to achieve the
same level of salaries. In order to get to that same level, some
boards have had to make drastic cuts. We won't call them frills,
because they're not frills, but things like special education and
all the consulting services that go with them have been cut
dramatically. Carol and Pat may want to add to that, because I
don't have figures to give you today, but there are figures that
back that argument up.
Obviously the teacher in
the classroom hasn't changed. The government has PTRs. The grade
4 classroom is a grade 4 classroom, with an average of 22 to one.
But all the services behind that teacher, whether they be in the
board office or in the consulting area, have been cut. The
administration has been cut dramatically. I think that was the
original intent when the government brought in this type of legislation, that we were
going to cut the fat, if I can use that expression, out of
it.
Mr
Christopherson: Thank you for your presentation. One of
the things I hope the government takes note of is that virtually
across the board, whatever community we were in or whatever
sector, we had representatives from all aspects. For instance,
colleges and universities: in every community where the college
made a presentation, they had representatives from the board of
governors, the faculty, support staff, students were there; the
same with the universities. In other words, their message was a
common front, which can have a powerful impact because often
those groups within systems have tensions that inevitably lead to
a circumstance where it's difficult for them sometimes to reach a
united front, and with different objectives and priorities.
One of the things we've
been hearing from teachers right across the board is the lack of
morale, that teachers are stressed, that teachers in record
levels are off on long-term disability, that many are taking
early retirement but are not retiring, just retiring out of the
teaching profession and moving on elsewhere, to the point where
anecdotally I hear of teachers who, when they're approached by
nephews and nieces or their own children about whether they
should go into the teaching profession as a career, are quietly
advising them not to, that it's not the world it once was. They
don't see any brighter light in the future so they're quietly
saying to them, "I would suggest you look somewhere else. What I
experienced is not what you would experience."
Is that your sense within
your area of responsibility? Is this a problem that you
recognize, this demoralization, the fact that teachers just feel
like they've been kicked and kicked and put down and it's kicking
the stuffing out of the stuff that makes good teachers do their
thing?
Mrs Ervin:
I can certainly start responding to that. The issue of teacher
morale is very real in all our boards. Something needs to be
done. The issue of teacher shortage is also very real. We are all
looking down the road and seeing that in a few years, and even as
close as this September, some of our boards will have a great
deal of difficulty filling some teacher positions. Some boards
have teams going across the country and are even communicating
with countries overseas to try to get teachers, but we're all
trying to rob each other. They are trying to do the same things.
There is a critical teacher shortage in England and Australia and
New Zealand and they are trying to get our teachers. Even in the
States it's the same situation. So the two, I believe, are very
real and probably connected in more ways than we think.
1150
Mr
Christopherson: The similarity between teachers and
nurses is striking in terms of the shortage, the demoralization,
the fact that there is a whole lot of poaching going on, if you
will. I know there are some provinces who are raising that
alarm.
What should the government,
which ultimately has the responsibility for dealing with these
things, be doing? Or, by addressing all the things you're
recommending, is that the kind of message teachers want to hear,
that their profession and their efforts matter and that this
government does care about children, particularly the early
years, and they're prepared to put their money where their mouth
is? Is that the message they need in order to turn this around,
or is there something else?
Mr Patrick
Slack: I could quickly offer an answer, and I'm not sure
it's an answer; it's a suggestion that there are probably two or
three things that really have to happen. One is that, when I grew
up, I respected the teacher quite sincerely and so did my
parents. I don't think that respect is at the same level that it
was. I think that has to come from me and from you and from
others too. The government and the entire population has to
respect the profession that offers the basis of our economy, the
basis of our society. It's so essential that we return to that
important work the due respect it should have. It should come
from within the profession itself too. No one is excused from
that. I do think, though, on the morale issue, that would be part
of it.
The other is to allow time
for professional teachers to do the professional job. You can't
just count minutes of teaching the way we've done it recently.
It's not a clocked job. Some kids need special care on a certain
day. They need some love. They've lost a friend or they've had a
family fight or a family breakup and it just isn't on the
book.
Mr Doug Galt
(Northumberland): Thank you for your thoughtful
presentation. I'm just wondering how you would respond when
you're into negotiations and get information that isn't exactly
correct. I'll reflect what we were given by OSSTF last week. We
were told by them that average spending in Ontario was $4,992.
They were comparing this with the Great Lakes states, saying we
were $3,550 below their average. In fact, after our researchers
to the clerks of the Legislature checked this out, dividing
almost two million students by almost $15 billion being spent on
education, the average being spent this year is $7,503. We really
don't know from that research what they put into the average
education in the States, whether they included some of the health
costs that we have that come from the Ministry of Health, whether
some of the security would have been in there, but it's very
misleading information, at least in my opinion. If you were given
that by OSSTF, how would you handle it?
Mr
O'Connor: I'll try. We don't deal with OSSTF. We deal
with the Ontario English Catholic Teachers' Association.
Mr Galt:
Well, I'll say one of the unions that you deal with.
Mr
O'Connor: Right. The way negotiations are set up now,
it's an adversarial type of game, if you wish. Tina will remember
a few years ago we had six boards in this area on strike, and we
went through literally hell for about six weeks over this very
thing.
If you want to compare us
to the Americans-
Mr Galt:
Not me.
Mr O'Connor: -or whoever,
that's fine, because we don't belong in that country; we don't
play their games. If we want to talk about extracurricular
activities, a lot of American states pay their teachers for
extracurricular activities. We've gotten away from that, or we
haven't gotten to that point yet.
As far as average cost per
student, there are differences. We could have brought numbers
here for what Catholic boards spend on students and what public
boards spend on students, but we weren't going to do that because
it would lead to an economic argument that may be embarrassing
for some people. But yes, there are differences.
Mrs
Molinari: Thank you for your presentation. I appreciate
your taking the time to be here. Certainly I know full well that
Catholic boards have been doing a lot more with a lot less for
many, many years and now it's time to come back and to get
equity, but equity is still not there because in getting those
who have been spending high to move down, it's being sensitive to
their taking the time to come down.
I wanted to just make a
couple of comments. The teacher shortage is worldwide. Irene
Atkinson from the Toronto District School Board as much as said
that and recognized that. That's not just here in Ontario or just
in the Catholic boards.
With respect to teacher
morale, we all need to take responsibility for teacher morale. I
think some of the unions haven't done too great a job at keeping
that morale in the schools.
Special education, as you
talked about in your presentation, is certainly an issue that is
near and dear to me. There's a lot of work being done with the
minister at this point in time, working with various groups to
improve the funding for special education. It's an ongoing
process of finding better ways to better serve the students. I'm
hopeful that in time that will continue to improve. I don't think
we'll ever have that perfect model, because there's no student
who fits right into a perfect peg, but I'm hopeful that in the
future we'll be able to continue to improve on that.
One of the comments in your
presentation that struck me is that special-needs students who
enter and move between Ontario schools are having a difficult
time having that funding follow. That's something I'm going to
look into because my understanding was that with the new model
the funding would actually follow the student and it was a more
clear way of having that money follow the student. If that's not
happening, then we need to look at why and what we can do to
improve on that. Certainly the paperwork and the extra burden of
the administrative work that teachers and others have to do to
fulfil that requirement for that funding is something that's also
being looked at, because we want the teachers to spend more time
with the students and not so much on administrative work.
Thank you very much once
again for your presentation. It's helpful that you've also
included last year's report with your presentation. Although I
don't think you had the opportunity to present to the committee
last year, I know you did submit a written report, and it was
certainly considered along with all of the others. So, thanks
again for all the wonderful work you do and all the challenges
that I know you face on a daily basis.
The Chair:
On behalf of the committee, thank you for being here this
morning.
ONTARIO RESTAURANT HOTEL AND MOTEL
ASSOCIATION
The Chair:
The next presentation is from the Ontario Restaurant Hotel and
Motel Association. I would ask the presenters to come forward and
state your name or names for the record. On behalf of the
committee, welcome, and you have 30 minutes for your presentation
this morning.
Mr Len
Little: Good morning. My name is Len Little. I'm the
chair of the Ontario Restaurant Hotel and Motel Association. My
colleague is with me today, Terry Mundell, who's the president of
the association.
I would like to take this
opportunity to discuss with you the importance of the hospitality
industry to the Ontario economy, some of the challenges we have
been facing and perhaps to suggest some remedies to those
challenges.
The Ontario Restaurant
Hotel and Motel Association is a non-profit industry association
that represents the foodservice and accommodation industries in
Ontario. The association was formed by a merger of two
75-year-old associations: the Ontario Hotel and Motel Association
and the Ontario Restaurant Association. Dedicated to the growth
of a thriving and competitive hospitality industry, the ORHMA
provides a series of value-added benefits for its members. These
include several cost-saving initiatives, group purchasing
programs and educational services. The ORHMA's government
relations department represents the industry's interests to the
government of Ontario and to city halls across the province.
Ontario's hospitality
industry is one of the most dynamic and significant sectors of
the provincial economy, generating $16.3 billion in annual sales
or, put another way, 5% of the provincial GDP. With over 22,000
foodservice establishments and almost 3,000 accommodation
properties across the province, the hospitality industry directly
produces over 400,000 jobs, representing 6.1% of total employment
and 17% of youth employment.
However, contrary to the
popular belief that the hospitality industry is booming, average
profit margins remain a razor thin 2% to 5%. While the provincial
economy grew by 6.1% in 1999, the hospitality industry continues
to face uneven employment growth. For example, during 2000,
employment grew by 3.6% in the foodservice industry, but failed
to grow in the accommodation sector. This pattern followed 1999's
2.2% rate of employment growth in the foodservice sector and an
alarming 11.8% decline in the accommodation industry.
1200
These difficulties have
been a result of rising input costs, declining tourism and
continuing impediments to investment. For example, while overall prices
grew by 2.9% in Ontario during 2000, energy prices grew a
staggering 16%. Indeed, we have heard from some operators that
energy bills have increased by over 120%. The industry needs
immediate relief, especially in northern and rural Ontario, where
many of these effects are more pronounced.
Even with these rising
costs, foodservice establishments have been forced to cut meal
prices by an average of 1% to remain competitive, while
accommodation properties have faced a 2.6% decline in
province-wide occupancy rates. The result has been a less
competitive hospitality industry globally speaking, weakening
investment and limited employment gains.
Our submission focuses on a
number of proposed tax initiatives that the provincial government
can implement to assist in restoring stability and growth in
Ontario's hospitality industry.
While the ORHMA would
certainly support and encourage the government to consider a
reduction in the overall provincial sales tax, today we bring
forward some alternate recommendations that will have a positive
impact for both our industry and for job creation and growth in
the province of Ontario.
The first initiative the
association would like to recommend is that the province
eliminate the capital tax. Ontario's capital tax is a
profit-insensitive tax that directly acts as a barrier to
investment. It is important to note that many comparable
jurisdictions are not instituting capital taxes, and others, such
as the province of Alberta, have recognized the harmful effect of
these taxes and have decided to abolish them completely.
Hospitality businesses
require a tremendous amount of initial capital investment in
order to establish an operation. Since capital taxes are a
barrier to investment, it hurts Ontario's potential to attract
investment dollars in multinational operations since many other
jurisdictions across North America have a clear competitive
advantage over Ontario because they do not have a capital tax.
This has been especially pronounced in Ontario's accommodation
sector, which has suffered 6,416 job losses, or over three jobs a
day, since 1996.
The capital tax has also
discouraged many important investments in small business
enterprises throughout the province. The government has indeed
recognized the harmful effects of the capital tax on small
business in its decision to raise the capital tax exemption
threshold from $2 million to $4 million. However, this does not
go far enough. Eliminating the capital tax will result in
increased prosperity and job creation across the province, while
also raising the profile of Ontario in the international
community as a destination to invest and do business.
The next initiative we
would like to propose is that the government eliminate the
corporate minimum tax. The ORHMA heartily supported the
government's decision in the 2000 budget to reduce the small
business tax rate from 8% to 4% and the general corporate tax
rate from 15.5% to 8%. However, in addressing corporate taxes,
the government must consider the elimination of the corporate
minimum tax.
Ontario is the only
jurisdictions in Canada that has a corporate minimum tax. While
there are some states in the United States with a similar tax,
Ontario's corporate minimum tax acts as a direct disincentive to
investment and is an irritant to businesses. Indeed, many
companies which will not be required to pay the tax are still
required to undertake the complex calculation that accompanies
the corporate minimum tax. Furthermore, the corporate minimum tax
currently raises little revenue for the government.
The hospitality industry
struggles to attract investment dollars, and the corporate
minimum tax sends a negative message to many domestic and
international investors that are looking to invest in Ontario by
placing an additional potential tax burden on business. Members
of the ORHMA support the elimination of the corporate minimum tax
and request that the government take action.
There are two initiatives
relative to property tax reform that the ORHMA requests the
government consider. The first initiative under property tax is
the requirement of municipalities to reduce the overall
commercial tax burden. Property tax levels in Ontario are
currently, in our opinion, one of the largest impediments to new
investment. In fact, hospitality operators have cited the
incredible burden of property taxes as one of the primary reasons
for closures. While it is recognized that the government has made
efforts to modernize Ontario's antiquated property tax system,
further reform is still required. We understand and commend the
government for the difficult decisions it has made in dealing
with property tax reform, but we believe some of the most
difficult decisions still need to be made.
While caps and the
accelerated reduction of the business education tax ratios for
those municipalities over the provincial average have gone a long
way in providing businesses with short-term stability, it is
clear that long-term solutions are required.
Although property tax is a
shared responsibility between the province and municipalities, it
is becoming painfully clear that municipalities are just not up
to the job. Election-sensitive municipal politicians are
reluctant to shift any burden on to the residential tax base. In
fact, to date only a handful of municipalities have taken steps
to move their business tax ratios closer to the provincially set
range of fairness.
As a result, we recommend
that at the conclusion of 2001 if municipal governments have not
taken considerable steps in moving their tax ratios toward the
provincially set range of fairness, the provincial government
immediately require municipalities to reduce commercial property
tax ratios and further require all municipalities to be within
the range of fairness in five years.
The next issue relative to
property tax is the methodology used to assess accommodation
properties. As already mentioned, members of the ORHMA are
supportive of the government in their efforts to address the core
deficiencies of Ontario's property tax system. Ontario's accommodation
industry, however, warrants immediate attention and action to
rectify the damage that is being caused due to an incorrect and
punitive assessment method.
Currently, as you can see
from the graph on page 9, Ontario accommodation properties pay
the highest amount of property tax on a per-establishment basis
compared to the rest of the country. Further, Ontario's
accommodation properties pay almost 80% more in property taxes
than the national average.
Currently, the Assessment
Act clearly states that the value of a property for property tax
purposes is to be based on the value of the land plus buildings.
The assessment for accommodation properties does not meet this
standard.
In discussing the business
value included in a hotel, assessors recognize that business
value does exist. However, they do not adequately deduct that
business value.
Assessors in Ontario have
concluded that deduction of a management fee removes the entire
business component. This is a mistaken assumption and has
resulted in the assessment process of hotels becoming a de facto
income tax. The more income the hotel earns, the higher the
value, the more property tax it pays.
Members of the ORHMA
request that the government amend the current assessment
methodology being applied to accommodation properties for the
purposes of property tax and change the methodology to ensure
that the business enterprise value is fully deducted.
The next issue I would like
to discuss is increasing the PST basic exemption threshold from
$4 to $6 on restaurant meals. During previous pre-budget
discussions, there was consensus from all stakeholders that
increasing the $4 PST threshold was a positive initiative for the
province of Ontario to undertake, and yet the government has not
moved on this issue. As such, we would like to take this
opportunity to reiterate our position regarding this
initiative.
Meals currently purchased
from foodservice establishments under $4 are not subject to
provincial sales tax. This PST threshold of $4 has not been
increased since it was established in 1987 and has lost
significant value in real terms due to inflation. As such, it now
represents a barrier to growth in the foodservice industry.
This issue has widespread
implications for our industry. Over the last decade, as food and
operating costs have continued to rise, this threshold has
remained fixed. As a result, there has been substantial erosion
of margins, especially for mom-and-pop operations whose clientele
are very sensitive to the threshold. It is not uncommon to see
families purchasing meals separately to avoid the tax, and,
further, small operators usually price their breakfast, dinner
and children's specials below the $4 limit to meet their
customers demands. Unfortunately, the impact is diminishing
profit margins, which obviously have a detrimental impact on the
viability of a restaurant and the operator's ability to reinvest
and grow their business. This has consequences in terms of
sustaining existing employment levels as well as creating new
jobs.
The ORHMA strongly
recommends that the 14-year-old $4 PST threshold be increased to
$6, where it would be if it increased with inflation.
The employer health tax
threshold is the next issue I would like to raise.
Profit-insensitive taxes such as the employer health tax have a
disproportionate impact on labour-intensive workplaces such as
foodservice and accommodation establishments. The ORHMA supported
this government's initiative of eliminating the EHT on the first
$400,000 of payroll. The introduction of this initiative in the
government's 1996 budget has assisted the foodservice industry in
the creation of over 93,000 new jobs. We believe that now is an
appropriate time for the government to move beyond the original
exemption limit of the first $400,000 of payroll and raise the
exemption limit to the first $600,000 of payroll. This tax relief
measure will directly assist Ontario's many small businesses to
create new jobs. In fact, in Ontario's hospitality industry, the
vast majority of foodservice and accommodation operators are
small businesses. These establishments, which traditionally have
profit margins of 2% to 5%, would directly benefit from such a
reform.
Increasing the EHT
exemption threshold for businesses to the first $600,000 of
payroll will make it consistent with the government's annual
paperwork threshold for EHT and will help to keep Ontario
competitive. Our closest neighbours to the west, Manitoba, have a
higher EHT threshold exemption: the first $1 million of
payroll.
1210
The final issue we wish to
bring to your attention today is an issue we have discussed in
pre-budget discussions before, and that is the gallonage fee.
Jurisdictions outside Ontario are now leading the way in
recognizing the importance of reducing gallonage fees. The
province of Nova Scotia announced last year that their gallonage
fee will be chopped in half, and the red tape reduction committee
in New Brunswick recommended that their gallonage fee be
eliminated.
One of the main constraints
to the hospitality industry is the high level of taxation. More
than any other tax, the gallonage fee currently applied on beer,
spirits and wine bought by licensed establishments appears
unjustified, as it supports taxation on top of taxation.
Currently, licensees in Ontario pay two separate and distinct
licensing fees. One licensing fee is a fixed annual licence fee,
and the other is a variable volume or price-based fee-the
gallonage fee-applied to licensee purchases of beer, wine and
spirits. According to the Liquor Licence Act, applicants for a
liquor licence are required to pay application fees of between
$685 and $815, pay a fee of $240 upon the issuance of the liquor
licence and pay a renewal fee of $300. In addition to these
licensing fees, licensees are further required to pay an
additional licensing fee known as the gallonage fee, which is (a)
$2.64 per hectolitre of beer and (b) an amount equal to 12% of
the purchase price of wine and spirits.
This results in two fees
for every licensed establishment. After being charged these two
fees, licensees are required to charge an additional tax-10% PST-on
the sale of alcohol to their customers. It has long been the view
of the ORHMA that the gallonage fee paid by licensees supports a
situation whereby taxes are being charged on top of taxes and,
hence, needs to be eliminated.
In conclusion, I would like
to remind the government that the hospitality industry in Ontario
is a dynamic and important part of the economy; however, it has
not yet returned to operating at pre-recession levels. We believe
these initiatives, if adopted, will assist the industry to grow
and will help the government in its job-creation mandate.
Further, while the government has taken some important steps to
increase tourism, more must be done.
Thank you for your time
today. We would be happy to answer any questions you have.
The Vice-Chair (Mr
Doug Galt): Thank you very much for your presentation;
it's much appreciated. You've got me doing some new thinking when
you talk about liquor and gallonage; I never thought of it quite
in that size before. We have about four minutes per caucus,
starting with Mr Christopherson.
Mr
Christopherson: Let me say I'm surprised at that,
because most people who watch you drinking think in terms of
gallonage. I am joking, of course, when I say that. I want to
make sure that's on the record.
Thank you for your
presentation. You will probably know there are a number of
scenarios that suggest the changing economy under us is not going
to be good for anyone. There's a train of thought that suggests
that continuing with the tax cuts that are planned, or any
others, is going to have a dampening effect on the government's
ability to sustain expenditures. As we see from this morning,
there are even going to have to be cutbacks to offset the lack of
revenue.
What I want to pose to you
is, how do you see this benefiting you, at least in the short to
medium term, when the scenario goes like this? If they continue
with the tax cuts, they don't have enough money coming in to
maintain a balanced budget, and the only way you can do that if
you're cutting your revenue at a time the economy is dampening is
to cut spending. We see from the news clips today that's exactly
the direction the government is going; they're going to be
cutting.
If they start cutting,
based on the presentations we've had over the last two weeks,
what we're going to see is a huge impact on municipalities. They
are already struggling. We know what's happening here in Toronto.
I pointed out the 15% increase in water and sewer rates in my
home town of Hamilton to deal with infrastructure problems
because the fiscal pressure is so great on them, in large part
because of the downloading, that they're having to increase
costs, and property tax has been pointed to by virtually every
business group as a key component. So you've got upward pressure
on a key indicator that affects your industry and every other
business, and this is going to be exacerbated by pushing for more
tax cuts.
In addition, universities
have come forward and said, "If we're going to continue the kind
of value-added economy we've had in the past, we've got to make
significant investment in universities." It's not just the
universities saying it; it's the business side. The TD Bank was
in here making that post-secondary education pitch. So on the
university side there is the whole ability to keep the momentum
going in terms of the economic drivers, and the same pressure on
the college side. I don't need to tell you that a lot of the
people who work in your management positions graduate from
community colleges, so it's going to have an impact on you there.
We had a roads presentation this morning. We know the road
infrastructure, which obviously is key to the hospitality
industry, is feeling incredible constraints.
All these things require an
infusion of money, which is the opposite direction the government
has to go in, because it looks like they're going to continue
with their tax cuts. I'm not trying to play some little game and
trap you into a box, as unfortunately I think the chair of AMO
thought yesterday. I'm merely trying to pose to you a set of
economic circumstances that say to me it's really not in your
best short-, medium- or long-term interest, regardless of whether
we agree philosophically about tax cuts, to be advocating tax
cuts at this time. Your thoughts, please.
Mr Little:
I'll speak a little bit, and then Terry maybe can add to it.
First of all, I think tax cuts give people more disposable income
and then they have more income to spend in our restaurants and
hotels. The industry is already at a competitive disadvantage,
particularly-and unrelated to the provincial government-with the
GST issue and the fact it's being charged in restaurants and not
being charged in a lot of the takeout and Loblaws type of
situations. I think the tax cuts create more income for us. Do
you want to add to it?
Mr Terry
Mundell: Just to that point, you talked about infusion
of money, Mr Christopherson, and we talked specifically about the
capital tax. We, in our industry, are now competing with
multinational jurisdictions in terms of getting capital dollars
invested in Ontario to build new hotel accommodation stock and
reinvest in the hotel accommodation stock we have. Presently, the
capital tax is clearly a barrier to our investment opportunities.
We're seeing those monies go to other jurisdictions in the United
States when you're competing on an international basis.
Having said that, that
doesn't allow us the opportunity to reinvest in our businesses,
it doesn't allow us the opportunity to expand our businesses, it
doesn't allow us the opportunity to generate revenues in the
tourism and hospitality industry, which is so important to us. So
that is a significant barrier for us in terms of infusion of
capital.
The
Vice-Chair: We move on to the government side. Mr
Arnott.
Mr Ted Arnott
(Waterloo-Wellington): Thank you very much for your
presentation. You've done a very good job of representing the
views of your members to this committee in previous years, and
this year is obviously
no exception in terms of the constructive suggestions you put
forward for our consideration.
I want to go on the record
as saying I support your suggestion that the employer health tax
threshold should go from $400,000 of payroll to $600,000 of
payroll. I think that would be a significant incentive for
employers to hire. We have seen in the past that these
profit-insensitive taxes-and you also talked about the capital
tax-have been ones that have discouraged job creation. This is
something we need to be looking toward in the year ahead. Thank
you for making that recommendation.
I want to ask you about the
property tax point you made. You suggested that very few
municipalities are moving toward the range of fairness that the
government has encouraged. It's been my understanding that
they're required to move toward that range of fairness, and
you've suggest that very few have done that. Could you elaborate
to some degree on that? My understanding is that they are
required to move toward it. Am I incorrect?
Mr
Mundell: Essentially, municipalities are required not to
move away from the bands of fairness but they're not required, in
any way, shape or form, to move those taxation levels back toward
the bands. They can't move away from them. So if they are doing
any shifting, they have to shift toward the bands, but they're
not required to actually get there in a specific period of time.
So you could stay outside the bands of fairness from now until
eternity.
We know the government has
made significant efforts on the education levy side of the
equation. That has helped and will continue to help. We continue
to believe that municipal governments need some pressure applied
to them so they do in fact and are required to move to those
ranges of fairness in a reasonable time frame.
1220
Mr Arnott:
Would it help if the government published a list of those that
are doing well in that respect and those that perhaps need to
work a little harder?
Mr
Mundell: I don't particularly think a list or disclosure
would force a municipal government to change its tax policy. The
lists have been published before. As you're well aware, I was in
municipal government for some time. We've seen the lists before.
Quite frankly, they are decisions that are made by individual
municipalities on their own property tax system. We don't believe
that would force them to get there; it hasn't to date. We believe
stronger measures are needed.
The
Vice-Chair: Very quickly.
Mrs
Molinari: I have just one question about elimination of
the capital tax. We've been hearing that quite consistently in
the presentations. Do you have any idea how much it would cost
the provincial treasury?
Mr
Mundell: Elimination of the capital tax, to the best of
my knowledge, is about $1.5 billion for the provincial treasury.
It is a significant amount of money. It's also my understanding
that there is an input credit which the federal government would
receive, about a $350,000 to $400,000 windfall, I think. But
again, to the effect it has on our industry, without eliminating
or putting forward a concrete plan to eliminate the capital tax,
we are losing head offices. We're losing head offices to other
competing jurisdictions, not only in Canada but in the United
States. By losing those offices, we lose the spinoff. We lose the
spinoff meals, we lose the spinoff business travel, we lose a lot
of those benefits in Ontario. It affects our ability to generate
revenue, which affects your ability to generate revenue.
Mrs
Molinari: So is it safe to say that tax cuts create a
better economy?
Mr
Mundell: In our industry, tax cuts, clearly, and
disposable income correlate to jobs and investment.
The
Vice-Chair: I'm going to have to move on to the official
opposition.
Mr
Kwinter: I certainly support the employee health tax
increase to $600,000. I think that makes sense.
I have a little concern
about the competitive pressures on, certainly, the accommodation
part of your industry. I understand when you talk about the
spinoffs because of the investment of others, not the hospitality
unit but other businesses. But from a hospitality point of view,
it isn't like any other business. You can't say, "We're in a
competitive situation and we can put this hotel in Sault Ste
Marie at a much cheaper price than we can in Toronto, so that's
where we're going to put it." The investment is made on the
market, not necessarily on the cost, and if the market can
sustain the cost, regardless of what it is.
This committee has been
travelling. We've been staying at accommodations in one place
where they charged us $70. The next place charged $130 and the
next place charged $90, all for the same kind of
accommodation-
Interjection.
Mr
Kwinter: -well, not quite. Certainly I would say two of
the accommodations were comparable, with quite a discrepancy in
the price. What determines the price is the market and the
competitive situation, not so much who is out there but where you
can get the business you're going to get. People make that
decision, and they base that on that decision.
I'm quite interested to
hear you say the accommodation industry in tourism has dropped.
It was my impression that tourism was increasing in Ontario. Is
that not the case? I'd like to hear about that.
Mr
Mundell: In fact, Ontario experienced about a 1% decline
overall in international tourism during the first half of 2000;
however, foreign visits increased by about 1.5% nationally.
Having said that, we think the government has made some
significant efforts to increase tourism in Ontario through the
Ontario Tourism Marketing Partnership. We very much support that
initiative. We tend to believe that significantly more needs to
be done. The government needs to continue to invest in tourism;
it's extremely important.
We look across Ontario, and
you talk about market impacts and how decisions are made based on
market impacts. In fact, that is correct and partially correct.
Investments are made on return on investment and what the bottom
line looks like for those properties in each individual
marketplace. There are varying input costs across Ontario, for sure, but we continue to
find significant barriers to accessing capital. The return on
investment is not where it should be because of the high input
costs of property tax and capital tax, two significant barriers
to return on investment, two significant barriers to getting
extra capital to reinvest in our business. That's anywhere from
the some 1,100 properties that are under 30 rooms to the over 800
or 900 properties that are over 30 rooms. It's the same type of
issue for them: it's the return on investment. It's going to the
bank to access that capital to reinvest in your business.
Mr
Kwinter: For example, there's a hotel built in Toronto,
half a block from here, where they've invested millions and
millions of dollars. I assume they have made the business case
that they can get a return on that investment. You can't put that
particular investment virtually anywhere else in Canada and get
that kind of return. I understand for a small operator it's a
very serious problem. Maybe there should be a sliding scale
where, because of the infrastructure support and everything else
that goes with it, there has to be some payback for the
government that's providing that. For someone who has a small
mom-and-pop operation, where that isn't the case and they're
still subject to the same tax regime, maybe there should be some
adjustment.
I have some difficulty in
an industry that is so very site-specific as to whether they
survive or not. If they're not in the right location, it doesn't
quite matter what tax incentives, they're not going to make it. I
don't know how you address that.
The Chair:
On behalf of the committee, thank you very much for your
presentation. Our time has run out. We appreciate the content and
input.
ONTARIO PUBLIC SERVICE EMPLOYEES UNION
The Chair:
Our next delegation is the Ontario Public Service Employees
Union, if that delegation would like to come forward. Thank you
very much for appearing before our committee.
Ms Leah
Casselman: I wouldn't have missed the opportunity.
The Chair:
We can give you a second to take your coat off.
Ms
Casselman: Sure. I'll even roll up my sleeves.
The Chair:
You have a half-hour for your presentation. Whatever is left over
from your presentation will be split up evenly among the three
parties to ask questions or make comments.
Please state your names to
begin with for the record.
Ms
Casselman: My name is Leah Casselman. I'm the president
of the Ontario Public Service Employees Union. With me is Jordan
Berger, the director of research for OPSEU. Thank you for the
opportunity to address these hearings. It's nice to see all these
folks are still around and still doing their jobs.
OPSEU represents 100,000
public sector workers in Ontario, including the vast majority of
workers directly employed by the Ontario government.
Obviously the fiscal
decisions of the provincial government have a direct effect on
our members and on the services we provide to the public. As a
result, we look with anticipation and some considerable concern
to this upcoming budget. Given the slowdown that is already
having an effect in Ontario, we urge the government to change
their own approach to fiscal policy.
This year more than ever
the government faces a fundamental choice: either to continue
hollowing out public services through tax cuts or to take
courageous action now to preserve public services.
The Premier's announcement
yesterday that he intends to cut public spending even further
does not bode well for the future. It could also undermine the
province's economic prospects for years to come. As a general
observation, when economic times are good, ruling parties point
with great pride to their own policies as the cause of all
prosperity. However, when the economy takes a turn for the worse,
ruling parties throw up their hands and portray themselves as
victims of global economic trends.
1230
For the last six years, the
Harris government has peddled the line that provincial tax cuts
create economic growth. While the tax cut pledge is central to
the Common Sense Revolution, there is little evidence to suggest
that it has attracted much public attention or support. Few
Ontarians have noticed the tax cuts and fewer still see tax cuts
as a higher priority than good jobs and good public services.
This is a mystery that
requires some exploration. It is our opinion, and has been our
opinion for some time, that the tax cut strategy is an
ideological one, not a political one. The ruling Conservatives
had the great fortune to be elected during a period of
unprecedented economic growth driven by the US economy, a low
dollar and low interest rates.
Six years ago, the Harris
Conservatives realized that the public anger that sustained their
agenda of public service cuts, scapegoating and tax giveaways
would decline as the North American economy recovered from
recession. The only way to counter public pressure for
reinvestment in services was the tax cut agenda. Tax cuts would
allow the Conservatives to maintain high deficits-the government
has added about $80 billion to the provincial debt since 1995;
not bad for a guy who wants to get his fiscal house in order-and
then they plead poverty.
We must admit they have
been quite successful in this approach, though. Only recently,
with growing public concern with the state of the environment and
our health care system, has the government been forced to promise
reinvestment in public services.
This approach to public
services-to slash them and deny the consequences until a crisis
forces action-will not be sustainable in the near future, either
socially or economically. While the social consequences of
health care underfunding and environmental neglect are painfully
clear, the economic consequences are largely ignored by this
government.
Ironically, in the
promotional material that Ontario uses to attract foreign
investment to the province, the government actually recognizes
and stresses the economic importance of well-funded public
services. These documents state, for example, "US manufacturers
pay, on average, more than $3,100 per employee"-I guess that
would be US$3,100, so it's probably about C$5,000-"for the kind
of health care coverage provided by Canada's publicly supported
system."
Clearly, safe communities,
clean water, an efficient, affordable health care system and good
infrastructure are some of the factors that attract talent and
capital from outside our borders. The quality of life we all
enjoy is a major determinant of economic growth, and yet here at
home this simple truth is always denied. Here in Ontario the
government does not discuss the economic benefits of public
services. Instead, citizens are encouraged to look entirely to
the private sector for economic growth and to look critically at
their public services, as if the two can be separated. Well, they
can't.
The recent tragedy in
Walkerton, Ontario, produced a huge amount of negative publicity
for the government and, unfortunately, for our province. It is
not only the citizens of Ontario who wonder if their tap water is
safe; it surely must be a major concern as well for anyone
considering a move to Ontario, be they investors, nurses, doctors
or engineers.
Here are some recent
developments that speak to the problems we face in maintaining
our quality of life.
First, there is labour law
reform. Despite the clear link between quality of life and
economic success, the government has seen fit to further
undermine the Employment Standards Act. How can we claim that
Ontario is the best jurisdiction in North America in which to
live, work, and raise a family when workers are forced to put in
60-hour weeks without overtime? We thank the government, and this
will be the only time I'll do this-that got their heads up-for
providing unorganized workers with such a powerful incentive to
unionize, but we question whether the obsession with 19th-century
labour standards will really help us build a 21st-century
economy.
Last November, the
Provincial Auditor issued a damning report which emphasized some
of the consequences of Tory policies: staff cuts in the Ministry
of the Environment led to a 34% reduction in environmental
inspections; downloading and privatization have reduced
governmental accountability as services have been moved beyond
the scope of the Freedom of Information and Protection of Privacy
Act; as a result of ill-considered downloading, the estimated
cost involved in returning ambulance emergency response times to
1996 levels has grown to $100 million; Andersen Consulting, one
of your favourite groups to send money to, continues to be paid
three times the ministry rate for analysts and six times the rate
for consulting-you folks have money to burn; the problem is, it's
the public's money-the government's megajail strategy is being
implemented without even a basic business plan.
On that last point, OPSEU
has learned that there is no Canadian company that even qualifies
to run the new 1,200-bed maximum security institution in
Penetanguishene, the first private prison in Canada. What a claim
to fame for you folks. Allowing profits to be shipped offshore to
American and British prison conglomerates doesn't do much for
Ontario's economy.
Of course, prisoners are
not the only ones who suffer in the new tough-love Ontario. The
employers represented by the Ontario Association of Children's
Aid Societies have recently released a report on CAS workloads.
This report supports our long-standing argument that services for
the most vulnerable children in our province cannot be sustained
without additional resources, and I don't mean just reannouncing
money you've announced before. Our research shows that the
current funding formula in this sector gives our members four to
six hours of care per child. However, we know the bare minimum we
need is nine to 11 hours per child.
And of course, despite
unprecedented spending levels, the state of our health care
system remains precarious. OPSEU, among others, has already
pointed out to the government that their hospital cuts were
premature and ill advised. The staffing shortages caused by these
cuts will take years to overcome.
This Tuesday past, 20 of
the 23 hospitals in the greater Toronto area were redirecting
ambulances away from their doors. The state of Toronto's
hospitals is only one indication of the problem facing our urban
areas. While American states pour money into their cities,
realizing that healthy cities are key to economic prosperity,
this government is forcing Ontario cities to make major service
cuts on the cusp of a severe economic downturn.
In the field of education,
a public service that is critically important to the knowledge
economy, the government continues to lag behind almost every
other jurisdiction in North America.
The Ontario Alternative
Budget Working Group points out that overall capital spending on
basic infrastructure, such as roads, schools, colleges and
clinics, has been cut in half. Our investment in our collective
future has dropped from 1.2% of gross domestic product in 1995 to
less than 0.5% in 2000.
The real tragedy of six
years of Tory service cuts, privatization and underinvestment is
that overall government spending has actually increased. It's
amazing. I can guess where it's gone but it sure hasn't gone into
services for people. Despite deep cuts to public sector
employment, despite closed hospitals and children crowded into
portables, overall spending has increased. It's quite incredible.
What have we gained as a society from this redirected spending?
We know the government spent $3 billion to $4 billion they didn't
plan on their botched hospital restructuring. And we don't know
what the final bill for Ontario Hydro's restructuring will
be.
It's time that public funds were used to improve
our real competitive advantage, our quality of life, not just to
fix the problems this government has caused. We believe that
quality-of-life issues will become more and more prominent in
Ontario in the coming years. This is especially true as we move
to a high-skill, high-wage economy.
These fabricated crises in
public services affect the quality of life we enjoy in Ontario
and, in turn, this undermines our economic future. It's time for
real leadership. Past mistakes cannot be explained away with yet
another round of tax cuts.
1240
Like the rest of the world,
Ontario will be affected by the current downturn in the American
economy. That much is certain. However, it is not at all certain
that the current provincial government will take the necessary
steps to protect public services from this downturn.
There's an old piece of
advice that I must share with the government members of the
committee: beware the man who marries his generation; he may
become a widow in the next. I could explain that to you after, if
you like.
In 1995, the Conservatives
brilliantly captured the angry mood of the public. In 1999, the
Conservatives were re-elected on the basis of the economic growth
that they were fortunate enough to ride.
The coming years may well
be quite different from the last six, and I urge the government
to rethink its strategy accordingly. So far, Ontario has simply
not been competitive in the vision department.
Thank you very much. I'll
be pleased to answer any questions.
The Chair:
Thank you. We have approximately five minutes per caucus. I'll
start with the government side.
Mr Galt:
Thank you very much for your presentation. As I read through it,
I guess you're kind of undecided how you would vote in the next
provincial election. Sorry.
Ms
Casselman: I've never been undecided when I get to a
ballot box.
Mr Galt:
Just looking at it, it's obvious we haven't done anything right,
from what I'm hearing from you.
We have invested
tremendously in health care, for example. The year before we took
office, health care spending was at $17.4 billion. The first year
we were in, it was $17.6 billion, and now we're well over $22
billion. That was our commitment in 1999. We've increased in
education. We have looked at trying to improve efficiencies of
the government in many, many different areas. You may not
necessarily agree with the direction we've taken. I detected that
from your presentation. But when I first started here in 1995 I
had no problem driving into Toronto. There was no such thing as
gridlock. We now have net in Ontario 844,000 new jobs out there,
goods being delivered to people who have those extra jobs-quite a
change in Ontario. When I went to the shopping malls in my area,
I could park pretty close to the stores. Now I have to park out
on the far edge of those parking lots. You may reflect that
that's all connected with the American good times.
But I sit back and look,
why in BC did they come along in the early 1990s, and now,
starting in the mid-1990s to late 1990s, they started to crash?
You may say, "The Asian flu." No, that happened ahead of the
Asian flu. Why did we sit where we were, losing some 20,000 net
jobs up until 1995, and then all of a sudden in 1996 things
started to go ahead?
The previous delegation
that was here, representing the restaurant association, indicated
the advantage for them to get on and get more customers coming in
so as to have that extra disposable income. There are just so
many things that have happened right in the last almost six
years. Yes, I hear what you're saying, and yes, there have been
some people laid off in the public service. But I believe in what
our government has been doing. Ontario has gone ahead a long way
during that period of time.
Ms
Casselman: And your question was, what do I think of all
that?
Mr Galt:
I'm just making a statement.
Ms
Casselman: In response to your statement, I have a
question back. You commissioned the health care restructuring
commission to look at health care in Ontario. One of the strident
recommendations of the head of that commission was that you have
to invest in community health care, you have to invest in home
care. You've never done that. You have nurses who are paid much
less than hospital nurses. First of all, you call nurses Hula
Hoops and they leave the province. You've closed the facility
that trains technicians who provide cancer treatment.
The former Minister of
Health-which I never thought I'd call her-commissioned a study on
how you properly fund home care. That study apparently calls for
parity for those nurses in the home care system. I guess what you
haven't grasped yet is that home care is provided under many
roofs in this province. My understanding was that you wanted to
close hospitals because you thought that you could get away with
it with the private sector. But health care is provided under
many roofs, and yet you haven't funded the rest of the system. So
now you're having big problems because people are moving back
into the hospitals because they can't get the services in the
communities.
I drive into Toronto every
day. What I'm more interested in are the potholes. You contracted
out the services on the highways. But when you contracted out to
those private companies, which were probably run by most of the
friends of the Tory party, the contract you left with them is
that they will fill potholes this big. But if the pothole is this
big, then they get to charge you for everything-the drivers, the
car, the equipment, the tar. So guess what? They don't fill the
potholes when they're this big; they wait till they're this big.
They charge Ontario citizens, through the government, an arm and
a leg to get those things done.
So, yes, I do disagree with
you. I completely disagree with you. I was talking to a young
woman the other day. She said, "My husband and I don't have kids.
We're sick and tired of paying taxes for education. What do you
think of that?" I was actually in my dentist's chair at the time,
so I took her hands out of my mouth and I said, "Well, I guess
that depends on whether or not you want stupid people looking
after you when you're old."
The Chair:
With that, I'll move on to the opposition.
Mr
Kwinter: Before I get into the substantive thing I want
to talk to you about, I just want to make a couple of
observations on your presentation. You say the tax-cut strategy
is an ideological one and not a political one. That's the same
thing. It is an ideological thing and not an economic thing.
We've had many experts tell us, "Sure, tax cuts are great, but
they really haven't had a great impact on what's happening in the
economy. There are other, outside forces that have done that. We
have been the beneficiary of what's happening in the United
States." Just as a suggestion.
The other thing, of course,
that really sticks out is when you say the government has added
about $80 billion to the provincial debt since 1995. The total
provincial debt right now is only $114 billion, and about $100
billion of that was already in place when the government came
into office. So the increase has certainly not been $80 billion.
I don't know where that number came from, but that number just
doesn't make any sense. They say the total debt of the province
of Ontario is about $114 billion, so we can't have an increase of
$80 billion in five years when I know that when the NDP left, it
was in the $100-billion range. I can't remember the exact
numbers. I'm just pointing that out.
What I'd really like to
talk about is the announcement that was made by the Premier
yesterday that he is planning to cut some more public service
jobs. I want to tie that in with the situation you've raised, and
I think it's a very valid one. When Mike Harris was campaigning
in 1994, he said in Windsor that he was going to cut out the
casinos because "We don't have a revenue problem; we have an
expenditure problem." We had someone appear before us the other
day and say exactly the same thing, that we don't have a revenue
problem; we have an expenditure problem. Yet this government has
taken the expenditures of the province of Ontario to the highest
levels ever. Just to sustain that is going to be very difficult
if there is, and there undoubtedly is, going to be an economic
downturn. The only question is, how much?
My question to you is, what
do you see as the impact of the Premier's announcement yesterday
that he's going to continue with his tax cuts, he is going to ask
all ministers to take a look at their programs? There will be no
expansion in programming, but he's also going to cut the public
service employees. What do you see as the scenario spinning out
from that?
Ms
Casselman: I think his comment was more that he's going
to cut the bureaucracy. I know these folks won't want to hear it
over here, because they'll never aspire to it, but I think he
could probably get rid of all the ministers and the deputy
ministers, since all the decisions are made in the Premier's
office anyway. That would save us a lot of money.
You could cut the Premier's
35-person squad of OPP officers that ferret him around the
province. You could certainly, in a very serious vein, cut the
consultants. Look at the millions of dollars they're pouring into
Andersen. They're just making money hand over fist.
I think Baird was
embarrassed to actually have to admit that the welfare rolls went
up, even though they were berating and beating those people down
all the time.
1250
They're not interested in
having a public service that provides public service, as we know.
The main question back to the Premier, since he has told the
ministers that if they want to increase spending in their areas,
is, what in the Ministry of the Environment are you going to cut
to hire back the people you know you shouldn't have cut before
because seven people are dead? That's the question he has to
answer. When is he going to learn that as a government he has a
responsibility to ensure that the people of the province should
be able to rely on public services.
Quite frankly, having
public services available in communities, particularly in
northern Ontario, provides an economic base which will attract
industry to that community, because by having government jobs in
those communities you will have dentists relocate there, you will
have doctors relocate there, you will have people recognizing
that there is a base that they can build on, and then you will
have industry arrive as well. He's not interested in ensuring
that the economy outside of the private sector economy is
something that he wants to invest in in Ontario. I think we're
seeing now with the US economy and the Auto Pact-whoever thought
the Auto Pact would disappear?-all those kinds of things. Our
society and our communities are going to be based on whatever
happens on Bay Street or Wall Street.
Mr
Christopherson: Thank you, Leah and Jordan, for your
presentation. I also want to thank you, as I did the OFL
president, for raising the issue of the Employment Standards Act,
the refusal of the government to increase the minimum wage, and
they have now introduced a push to go to a 60-hour workweek. We
had no public hearings on it, and I think it's interesting that
the only folks who have raised this so far are people who quite
frankly aren't impacted by it because their members really don't
rely on the Employment Standards Act; they rely on their
collective agreements. I think it says a lot about the labour
movement that they're here fighting for those vulnerable workers,
in many cases, in the absence of the government doing it. So
thank you for at least raising that.
I also want to pick up on
where the government seems to be heading. We know, based on
scenarios given to us yesterday, that this push to continue with
the tax cuts is clearly going to put the government in a deficit
position, deeper probably than we're already being told. I
suspect there are revisions happening daily in the ministry. His
answer to that, rather than back off the tax cuts and attempt to
keep revenue up to keep us in a balanced-budget position, is now going to be to cut
spending yet again. He's quoted as saying in the paper this
morning, "If there is any increase in spending or any new
programs, we expect those to be offset with savings in other
areas."
We've had groups for two
weeks straight who have come in here and pointed out key areas of
our society and our economy that need more money and that tax
cuts are not the answer for their getting the funding.
Environment is an obvious one, and you raised that in your
presentation; elementary schools, the secondary schools, colleges
and universities. I have Mohawk College and McMaster University
in my riding in Hamilton. Emergency rooms are still overcrowded,
and Hamilton is facing just as big a crisis as every other
community. We had the strikes in CCAC and VON in Hamilton as a
result of lack of funding, and this is on the community care side
of things, an announcement that the city council has to look at a
15% increase in sewer and water rates on the property tax because
of the fiscal pressures of downloading on them, and now the
government says that for every dime of pressure-this is what I'm
going to read into this-that they're going to have to spend, you
have to offset it with a cut somewhere else if you're the
minister.
Given all these pressures,
what I'd like you to articulate for us is a sense of, for
instance in Hamilton, what the average family can expect if we
start to get into hundreds of millions or even billions of
dollars of further cuts. What's that going to do to the quality
of life of the constituents in my riding in Hamilton?
Ms
Casselman: First of all, there will be constituents in
your riding who will be unemployed, and then looking for the
60-hour-a-week jobs with probably close to if not less than the
minimum wage. There certainly will be more people in jail, so
there will be more pressures on the Hamilton-Wentworth Detention
Centre, those kinds of things, more things happening there.
You'll probably see more Plastimets, more environmental hazards.
If they're going to try to cover up their problems with
Walkerton, I guess air quality will be cut while they're looking
after water, because they don't think they have to look after it
all. There won't be those inspectors to ensure that those places
aren't there waiting to explode.
They talk about investing
in the province, and then you look at what they're doing to
education. Their idea of investing in post-secondary education is
to give them money to build things. But ordinary people can't
afford to send their kids any more, and the $200 isn't even going
to buy them books, quite frankly. It really does come down to
what kind of system you want.
In Hamilton, the hospital
restructuring, yes, they're going to create a big monolith there,
but as we're seeing with other situations, if it gets too big you
can't run it. I didn't realize the answer was so simple on cancer
treatment, because they've been decrying the fact that they're
having to send people to the States, and here all they had to do
was hire the people who are trained technicians and give them
overtime and they could run the equipment at night, just like the
private company is, established by the board of directors from
Cancer Care Ontario. All the government had to do, until you
reopen the college to train technicians so that you have them
available in different locations to offer cancer treatment, was
say to those folks who were working the dayshift, "Do you want to
work some overtime?" and we would have that continued in the
public system. It wouldn't be a matter of, "You only make $25,000
or $30,000 a year, and you have cancer? Get out of the way. I've
got my platinum card here. I'm going in at night, and I'm getting
mine done. You wait the seven, eight months," or the 14 weeks or
whatever the backlog is now. If you don't have the money, you
don't get the service. That's where we're headed, and you'll see
more and more of that in every community across the province.
The Chair:
With that, I have to bring the discussion to an end. On behalf of
the committee, thank you very much for your presentation this
morning.
This committee will recess
until 2 o'clock this afternoon.
The committee recessed
from 1256 to 1358.
ONTARIO CAMPAIGN 2000
The Chair:
Good afternoon, everyone. We'll bring the committee back to
order. Our first presentation this afternoon is from Campaign
2000. I would ask the presenters to come forward and state your
names for the record. On behalf of the committee, welcome.
Mr Pedro
Barata: My name is Pedro Barata. I'm with Campaign 2000.
With me are Lynne Russell and Casey Ready. I too would like to
thank you for the opportunity to address the committee today.
Campaign 2000 is a national
coalition of over 90 organizations that work toward the
implementation of the 1989 House of Commons resolution to
eliminate child poverty in Canada. In Ontario we have close to 40
organizations that are diverse and represent professional groups,
community organizations, individuals and interfaith groups. For
our presentation today I will begin, then I will pass the
microphone to the other people who are here with me, and I will
conclude with some recommendations and, hopefully, we'll have a
chance to exchange some questions and answers.
The next provincial budget
will be another opportunity to make choices and set priorities
for the future of Ontario. In last year's budget, the government
allocated $2.5 billion in tax cuts, with $1 billion benefiting
the highest-income 10% of Ontarians. This one-sided approach to
tax reductions is unlikely to make much of a difference for
low-income families and their children. In the face of an
impending economic slowdown, we urge the Ontario government to
commit to an investment strategy that will establish a
comprehensive social infrastructure for children and families in
this province.
Governments can play a
vital role in preventing social exclusion by providing families
with the security and stability they need. Much research,
including the Early Years Study commissioned by the Ontario
government, has shown that a healthy start in life has a
long-term impact on the well-being of children and, really,
society as a whole. We know that children who live in poverty
encounter more hurdles to healthy development and are at elevated
risks for a wide range of negative outcomes to their health and
well-being. The ability of children to progress through each
stage of development depends upon the range of resources that are
provided by their families, their communities and society as a
whole.
An environment that
nurtures inclusiveness requires the supply of good jobs that
adequately support families. Families and children also have a
right to income security, early childhood development services
and child care, affordable, secure housing and accessible
post-secondary education.
This past November we
released a report card on child poverty in Ontario that shows
that despite this period of growing prosperity, child poverty
remains at near-recession levels. We found that even while the
economy was running on all cylinders, almost one in five children
remains poor. We also found there was a whopping 90% increase in
the number of poor children in this province since the beginning
of the decade. To keep that in perspective, that compares with a
mere 28% increase in the rest of the country. While the child
poverty rate in Ontario has declined 1.8% since the present
government has come to power, the reality is that this decline
ranks a mere sixth out of the 10 provinces in Canada. I refer to
page 3 in the brief that we submitted to you. The chart in the
middle compares the different declines across the country.
Ontario's growing wealth is not creating opportunities for
everyone. Since 1996, Ontario and Newfoundland were the only two
provinces where low-income families fell deeper below the poverty
line and, on average right now, low-income families live $9,900
below the poverty line.
The point we really want to
get across to this committee today is that we know government
investments can make a difference for children and families. A
recent UNICEF report ranked Canada 17th out of 23 OECD nations in
terms of addressing child poverty. UNICEF concluded that the
difference between how different countries perform in terms of
addressing child poverty is related to how each sets priorities.
Most of the nations that fare better than Canada mitigate the
negative impacts of unemployment, low wages and lone parenthood
through substantial investments in comprehensive family policies,
which include things like income security, generous unemployment
benefits, affordable housing, as well as a range of early
childhood development services.
To illustrate this point,
in Ontario the child poverty rate fell from 24% to 17.5% after
transfers such as the child tax benefit, the GST credit and
employment insurance. But spending on public services as a
percentage of the GDP has dropped 2.6% since the Tory government
has come to power.
Campaign 2000's report card
shows that there is a crumbling infrastructure of supports for
children and families. We found reductions in school programs
such as ESL and special education. We found that child care and
early childhood development services are not widely available,
nor affordable, and that in fact less than 10% of children under
10 have any access to regulated care. We also found that benefits
and supports for families on social assistance continue to
decline, and now families are receiving benefits that are 40% to
45% below the poverty line. As you all know, affordable housing
is in short supply, with virtually no new rental housing starts,
and rising rents right across this province. Tuition fees for
post-secondary education have jumped 140% in the last decade,
where students are now graduating with average debts of
$25,000.
Yet we seem to hear the
same answers, whether we ask why Ontario has the highest monthly
fees for child care or why affordable housing waiting lists keep
growing. The answers are invariably, "Our economy is growing,"
"We're creating jobs," and "We're cutting taxes." With over
470,000 children living in poverty in this province, we should be
a bit more ambitious than this. This next budget is an
opportunity to take steps toward addressing the situation.
Low-paying jobs make it
difficult for families to make ends meet. We found that the
number of children in poor families with full-time, full-year
employment is a growing proportion of the total number of poor
children. In general, tax cuts make little difference for
families that have low incomes to begin with, and they also erode
our capacity to invest in the kinds of programs children need. I
refer you to page 6 of our brief for a comparison of how the tax
cuts in the budget last May affect different income groups.
We call on our government
to develop a more comprehensive approach to addressing child
poverty, one that ensures we give children the best possible
experiences during their formative years so that they may
continue to flourish throughout their lives. To achieve this, our
government needs to look beyond general tax cuts and must refocus
on a social infrastructure for children that is based on quality
services, affordable housing, income security and well-paying,
secure jobs for families.
I will now pass the
microphone to Lynne Russell from the Halton Social Planning
Council. After that, Casey Ready will address the committee, and
in the end I will provide you with some recommendations from our
group.
Ms Lynne
Russell: I'd like to thank the committee for letting us
speak this afternoon. As Pedro mentioned, I'm from the Social
Planning Council in the region of Halton. The Halton Social
Planning Council is a community partner of Campaign 2000 along
with many other partner organizations that produce a local report
card on child poverty.
Many of Halton's families
and individuals are affluent. In fact, the average annual family
income in Halton is almost $80,000. However, many Halton families
have incomes well below this average. In fact nearly 60% have
incomes below that
level. Of these families, 13% have annual incomes below
$29,000.
I'd like to highlight some
of the information we have in our report card on Halton. In the
report card we use Statistics Canada's low-income cut-off as the
definition of the poverty line. Using those figures, in Halton
over 7,500 children aged zero to 14 and over 4,500 youth aged 15
to 24 are poor. This translates to 11% of all children and youth
or one in 10. Children are poor because their families are poor.
In Halton, over 7,000 families are poor, which translates to 8%
of all families or 21% of all single-parent families. In
addition, over 8,500 unattached or single individuals in our
region are poor, which is approximately 30% of all unattached
individuals.
Why are families poor?
Poverty is a human construct. The way economic resources are
distributed is not a function of unchangeable economic laws but
rather of political-that is, human-choices. Many are poor because
they do not have access to appropriate education and training.
Many are poor because the only jobs available to them are
temporary, part-time, low-skilled and low-paying. Many are poor
because they are unable to work and have a physical or mental
disability. Many are poor because government income support
programs are inadequate to cover the basic cost of living. Many
are poor because they have fled from abusive relationships.
I'd just like to give some
information-some of it province-wide and some from Halton-about
factors contributing to poverty. The minimum wage has been frozen
at $6.85 an hour since 1995. In Halton, the Ontario Works
caseload has fluctuated, with a current monthly figure of
approximately 1,400 individuals. Although social assistance and
employment insurance figures have decreased in the last few
years, the number of families living in poverty in Halton has
increased 80% over the last 10 years. Another contributing factor
is the 1995 cutbacks of 22% to social assistance cheques. In
Halton each month in 1999, an average of 3,280 parents, children
and single people used one of the 11 food banks in our region,
which is an average of approximately 1,200 families a month.
1410
Housing: The average Halton
rent for a three-bedroom apartment has increased from $740 a
month in 1989 to over $1,000 in 1999, and vacancy rates are under
1%. The housing authority and rent supplement waiting lists in
our region increased from approximately 800 households a month to
over 1,100 last year. The waiting list for subsidized housing can
be as long as five years, and no social housing has been built in
our region since 1994.
Some of the changes to
programs for families and children include an increased use of
emergency shelters in our region. One family per day was turned
away from Halton Women's Place in 1999, and the number of calls
to the Halton Rape Crisis Centre increased from 50 in 1989 to
over 2,700 in 1999, without a funding increase. The average
waiting list for subsidized child care in Halton has fluctuated
since 1989, but the average figure last year was approximately
over 400 cases a month waiting for child care.
Pedro has already talked
about some of the policies and programs that we need to address
poverty. I would like to bring to your attention the need for a
national children's agenda. The Halton Social Planning Council
recommends a full national children's agenda that includes job
creation as a cornerstone to reducing child poverty. When
families are working, the cost of living is more affordable and
there is less pressure on the social safety network.
We need income security
programs that prevent families from falling below the poverty
line, and programs such as the national child tax benefit and
employment insurance should be expanded to benefit all families.
We need to reinvest and develop further education and employment
training programs that reflect current and future labour market
trends. We need to increase funding to provide more affordable
and emergency housing and support programs. We also see a need
for a continuum of child and youth development services for
families and children.
We ask you to join us in
calling for the right recipe for the well-being of all Canada
children.
I would like to pass it
over to Casey now.
Ms Casey
Ready: Thank you for the opportunity to speak today. My
name is Casey Ready, and I'm the executive director of the
Peterborough Social Planning Council. The council is a partner
member of Campaign 2000.
The Peterborough Social
Planning Council covers an area of approximately 122,000 people.
There are 70,000 people in the city of Peterborough and
approximately 52,000 in the county. For those of you who have had
an opportunity to visit it, you will recognize it as a lovely
community in the Kawartha area of the province. However, our
community is facing the same types of challenges felt across the
province, with growing poverty rates, growing depths of poverty
and an increasing gap between the well off and the poor.
Poverty rates in the city
of Peterborough have exceeded province-wide averages. Many of the
factors contributing to the high poverty levels and an increasing
depth of poverty in Peterborough are the same as those
contributing to poverty across the province. They are: reductions
in social assistance rates, a tightening in eligibility for
social assistance, the lack of increase in the minimum wage and
the clawback of the national child tax benefit supplement from
families on social assistance.
One of the indicators of
poverty has been the number of individuals and families that are
homeless or housing insecure. Surprisingly, and sadly,
homelessness is increasingly visible in Peterborough. A study
completed last year by ONPHA, the Ontario Non-Profit Housing
Association, found Peterborough city to have the highest rates of
affordability issues of 21 communities across the province,
including Toronto, Ottawa and Hamilton. We had 28% of
tenants-roughly 3,000 tenants-paying over 50% of their gross
income on rent, and 55% paying over 30% of their gross income on
rent. Rents are somewhat lower in Peterborough than in the GTA, but the
income difference is much greater. The incomes are lower. Tenants
are squeezed between dwindling supplies of new rental housing,
increasing rents and decreasing incomes.
In response to the growing
alarm with the magnitude and urgency of local housing needs, the
Social Planning Council, in partnership with a number of other
organizations, conducted a study last year of 206 households,
representing over 500 people, in relation to housing and
security. I've brought copies for the committee. The report is
titled A Crisis of Affordability: A Study of Homelessness and
Housing Insecurity in Peterborough City and County.
I would like to share with
you some of the findings that relate to a picture of the stresses
that are facing families and individuals. These might be seen as
stresses in a typical small town in Ontario.
First of all, we chose to
do our research on a sample that represented low-income people so
that we could better understand the situations of groups and
subgroups who were at risk of homelessness. Today I will comment
mainly on the families and children in that sample.
Two hundred and six
households were interviewed, including 50 adults and 18 children
who were homeless at the time of the interview. Of the people who
were homeless when interviewed, one in four was employed and one
in 10 of the people who were homeless was employed full-time. The
households with children experienced a greater degree of housing
instability, with higher rates of frequent moves, and were more
likely to have been homeless in the past three years than
households without children.
Lone-parent families also
faced problems with the quality of their housing and greater
barriers to finding and maintaining safe, secure and affordable
housing. This was due in part to discriminatory treatment by
landlords. Households with children were two times as likely to
report discrimination as were households without children. Our
study demonstrates that homelessness and housing insecurity is
not just a big-city problem and that there is a link between
housing insecurity and food insecurity.
Some quotes from people
interviewed included:
"All our money goes on food
and rent. Mom has," only "$40 of her cheque left to buy
food."
"People have jobs but they
don't," have enough to pay "for the cost of living."
"I find" in "Peterborough
that the housing cost is quite high and utilities costs are out
of control. Why is the rent so high here, when there is no
work?"
"Minimum wage hardly
reflects what we have to cope with these days."
Our organization works with
an extremely broad range of local groups: government bodies,
social services and health agencies, planning groups, grassroots
organizations and individuals. We daily hear the impact of
poverty on the lives of individuals, families and children. I
want to share with you some of the stories I've heard
recently.
One agency that works
directly in housing support has found that there are as many
people, both individuals and families, homeless in one month as
there were five years ago in a year. This month there were five
families with children who were literally homeless. Last Friday
there were two mothers who arrived and had had no food for a full
week for their children. One family had three children and the
other family had two children. There are now 50 applications
waiting for their emergency fund program. There's a major issue
this year, in the winter, of the ability to pay for heat.
More local agencies are
needing to offer food to their clients as they provide service.
People, especially those coming with children, are hungry, and
providing food makes them able to concentrate on the services
provided. One agency that offers a collective kitchen has noted a
major increase in both the numbers of people attending and that
there's never any food left at the end of the programs.
Schools and teachers are
increasingly finding the need to get food and warm clothing to
children. We have 10 food banks in Peterborough. One in 10 in our
area serves an average of 850 to 900 children per month, and
that's 100 to 150 more than were served by the same group two
years ago. That was an increase of 12% to 21%.
I've brought copies of the
report. I hope you'll read them, especially noting pages 24 to
28, where the solutions that were recommended by the people who
were interviewed are noted. It's not surprising that the two top
solutions that were recommended had to do with the issues of
supply of housing and adequacy of income, two areas where the
provincial government has the opportunity to make a big
impact.
Peterborough is also
becoming known for its innovative responses to homelessness and
housing insecurity. If there is time permitting later, I would
like to share information with you on these innovative
responses.
Pedro will be speaking now
on a number of needed solutions, and I hope you will use the
power that you have to implement these solutions.
1420
Mr Barata:
Thank you, Casey. I think what my colleague's presentation shows
is that we have a child poverty issue right across this province
that's not by any means isolated in our major urban centres.
We've developed a set of recommendations in consultation with our
partners right across this province and I'd like to share those
with you.
We urge that the Ontario
government commit to work with the federal government to
implement policies that promote a more inclusive society.
Campaign 2000 calls on the provincial government to commit a
sizable portion of its projected surpluses and existing resources
toward making a real difference for families and children.
In order to fulfill its
promises to children, the government needs to take immediate
action by shifting its strategy away from a one-sided approach to
tax cuts. Children and families require new investments in income
security, early childhood development services and child care, housing, education and a
strategy to increase the number of good jobs.
We are recommending that
the Ontario government take immediate action on the
recommendation of the Mustard and McCain Early Years Study to
ensure a comprehensive range of early childhood development
services is available for all children and their families in
Ontario by 2004. A comprehensive system of early childhood
development services must include quality licensed child care,
pre- and postnatal care services and supports to communities and
families. The Ontario government has a real window of opportunity
here and it should at least match the $840 million that were just
announced by the federal government toward early childhood
development services. There's been virtually no announcement or
consultation on this matter.
The Ontario government
should also rectify the current lack of income security among
families across the province. This includes ensuring that
families on social assistance and the working poor receive
benefits and supports that prevent them from falling into
poverty. It also includes an end to the practice of deducting the
amount families receive from the national child tax benefit from
their social assistance cheques, the so-called clawback, which
I'm sure you've heard about from other groups throughout your
tenure on this committee.
The Ontario government
should also work with federal government to set targets and
provide funding and incentives to increase the amount of
affordable rental housing and supportive housing. Specifically,
the province should have an annual target for at least 16,000
new, affordable rental units and should allocate at least $265
million annually to share the cost of meeting this target.
The Ontario government
should also increase the supply of good jobs with better wages
and increased protection from job losses. The government should
start by increasing the role of the public sector, providing
meaningful training and increasing the minimum wage to reflect
the actual costs of raising a family. The government should also
ensure that the labour code protects parents from the possibility
of being forced to work 60-hour weeks.
The Ontario government
should also ensure that all children get the best possible
education throughout their life cycle by providing adequate
funding for the elementary and secondary school systems.
Finally, the Ontario
government should work with the federal government to freeze and
lower tuition fees by increasing investments to colleges and
universities.
I believe we have about
seven minutes left and I'd like to open that up for
questions.
The Chair:
According to my watch, we have about four minutes left. I'll
allow one minute per caucus.
Mr
Kwinter: Thank you very much for your presentation.
Anyone who wants can answer this question, because I'm only going
to have a chance to ask one question. We keep hearing that the
people who are on social assistance or welfare are going off the
rolls. The government makes a big thing of periodically
announcing that the welfare rolls have dropped dramatically, and
yet you and other groups that come to us tell us that the
situation is getting much worse, there's greater child poverty,
there's greater homelessness, there are greater problems. How do
you account for that? Is it just that they've made the
eligibility tighter, or is there a whole new subculture that's
growing?
Mr Barata:
I know that a recent report by the city of Toronto shows that
although there were people cycling in and out of social
assistance, there's a core group of lone-support parents who,
because they lack support such as child care, are unable to
essentially get out of social assistance. As cost-of-living
increases have not been built into the amount that social
assistance pays, obviously those families are under strain. What
we do find is that although child poverty is not rising off the
charts over the past five years, it has certainly been at
consistently high levels throughout the past five years. At the
same time, housing costs keep going up, the cost of living keeps
going up and the minimum wage stays the same. So even those
families that are working are still no better off.
What we find is that
although people are coming off the welfare rolls, there's an
inverse relationship where there are more and more working poor
families. If you map this out on a chart, it's almost like a
cross. You find there's a declining social assistance roll and
that there are more and more working-poor families. I think the
lack of supports and the fact that the minimum wage has been
frozen since 1995 and housing costs have continued to go up
accounts for why families are no better off, despite the supposed
economic prosperity. I don't know if anybody has anything-
The Chair:
Thank you. We'll go to Mr Christopherson.
Mr
Christopherson: Thank you for your presentation. I'm
from the neighbouring community in Hamilton and we always looked
at Halton as being the rich folks, so if it's showing itself
there, then I think it should be a wake-up call.
As we draw to a close of
these hearings-after this afternoon, we're finished-there really
are two Ontarios that have been coming in here. One is the
Ontario that has benefited from the Harris cut-taxes,
cut-spending, shrink-government agenda-and that's a very small
elite-and then there's this huge whack of people who have seen
their quality of life diminish, their children's education
diminish, the health system that's available to them. They're
beginning to catch on that there's a link between this agenda
that says everybody is doing really well and the way they see
their quality of life sliding. Then there are those who are
already in poverty or have been pushed into poverty who, I
suspect from the outset, clearly saw this when they got whacked
with a 22% cut in their income. It still, to this day, six years
later, boggles my mind that that happened in Ontario and that
there wasn't rioting in the streets, that you could actually take
the poorest of the poor and cut their income by 22%.
Some of these Tories wanted
a 42% increase in their own wages. They've given their own staff
25% to 30%, and it may
be justified in some cases; maybe it was warranted on an
individual basis. If you suggested that the people that work for
them take a 22% decrease, they'd go out of their minds, yet those
who are in poverty are expected to accept that and everything
else.
I don't know if there's any
time left, but I just want to say to you that there are clearly
two Ontarios: there are those who are winning big-time and then
there's everybody else, and everybody else is sliding further and
further behind.
The Chair:
Go ahead for a quick response.
Mr Barata:
Not only were social assistance rates cut; at this point there
are actually programs for the working poor being funded strictly
out of the incomes of families on social assistance. The federal
government provides a national child tax benefit to families on
social assistance, which is clawed back dollar for dollar from
social assistance cheques and then is reinvested under a new
provincial program for working-poor families. Certainly the
stories go on and on. It's just another example of how there is a
real lack of vision at times for programs for the least
well-off.
Mrs
Molinari: Thank you very much for your presentation. You
have just talked about the national child tax benefit, and, in
fact, we have reinvested that $100 million into the Ontario child
care supplement for working families, as you've indicated. That
brings the value up to $200 million. Also, Ontario's promise is
to get organizations working together. There have been a number
of initiatives that have been put forward: the early years
challenge fund; the Ontario Breakfast for Learning program;
Healthy Babies, Healthy Children; and Better Beginnings, Better
Futures. There are a number of programs that have been introduced
and initiated to provide for some of the concerns you've
expressed here.
Certainly we believe that
in order for a government to continue to provide for those in
vulnerable situations, we need to have a strong economy and we
need to have the funds to be able to do that. In order to do
that, you need a strong economy. You need to have the tax base;
you need people working in jobs to be able to contribute to that.
As much as we have the same view on what we should be doing to
assist those in vulnerable situations, we also have varying views
on how to do that. As a government, we're looking at long-term
benefits rather than short-term fixes. In order to have that
long-term benefit, you need to, again, as I've stated, have the
strong economy that continues so that there is money to be able
to invest in all of the programs.
The Chair:
I would ask you to wrap it up, please.
Mrs
Molinari: Then I will just end by saying thank you for
the work that you do and for the presentation that you've made
here. It brings some of the issues to light. Certainly, we will
consider it along with all the other presentations that come
forth.
The Chair:
On behalf of the committee, thank you very much for your
presentation this afternoon.
1430
REGISTERED NURSES ASSOCIATION OF ONTARIO
The Chair:
Our next presentation is from the Registered Nurses Association
of Ontario. I would ask the presenters to come forward and state
their names for the record. On behalf of the committee, welcome.
You have 30 minutes for your presentation this afternoon.
Mrs Doris
Grinspun: Good afternoon. My name is Doris Grinspun. I
am the executive director of the Registered Nurses Association of
Ontario. I would like to also introduce my colleagues here: Kim
Jarvi, who is the economic analyst of the Registered Nurses
Association; and also my colleague Jacqueline Choiniere, who is
the director of policy and research at the RNAO.
The RNAO is the
professional organization for registered nurses who practise in
all sectors across this province. RNAO's mandate is to advocate
for healthy public policy and for the role of registered nurses.
We welcome this opportunity to participate in the pre-budget
consultation and to convey the views and recommendations of
Ontario's registered nurses to the standing committee on finance
and economic affairs.
Let me present to you some
of the highlights from our written submission, which you have
with you, I hope. We will first address health care issues in the
broader sense, and then specific nursing issues.
Budgetary decisions impact
the health of our population in a variety of direct and indirect
ways. They set the fiscal and economic framework. The resulting
policies have significant implications for a series of social and
environmental factors that, in turn, have long been known to be
critical to health status.
Health care is one
determinant of health. Ontario residents, like all Canadians, are
passionate about preserving equal access to necessary health care
services-access that is based on need, rather than the ability to
pay. Like most Canadians, registered nurses are passionate about
these values. Public opinion remains loyal to this belief.
Universal access to health care is not a new concept for
registered nurses; it has long been a priority, both at the
provincial and national levels.
There is another critical
element in our support of a universal, accessible, publicly
funded health care system, and that is, simply, that it works.
Evidence continues to mount that public funding and
not-for-profit delivery of health care are both more effective
and efficient.
Access to appropriate
health care is an important determinant of health, but it is not
the only one. There is a tendency in our society to focus on
curative health care as the most useful, critical tool for
improving the health of the public. Yet research has well
established a series of other important factors-factors that are
often overlooked: absolute and relative poverty, which my
previous colleagues spoke about; unemployment; stress; social
support; social cohesion; and lifestyles. Public policy changes
these policies for better or worse.
We cannot ignore the fact that a growing income
disparity combined with the fraying of the social safety net
greatly reduce the degree of cohesion in our society. We risk
losing even more provincial cohesion if we continue to tolerate
huge spreads of income and wealth and if we fail to reinvest in
the social safety net. Those who have become increasingly
marginalized have waited long enough.
Even the best health care
system in the world, if it were combined with an inadequate
social safety net, would still compromise the health of a
significant portion of the population. In the long run, this
would prove to be a very costly misallocation of resources.
That's why we say, now is the time to invest for the future. In
particular, it is the time to reinvest in those areas which have
been hard hit by budget cutbacks and by private sector
retrenchment-physical, human and social capital.
Over the past few years,
provincial reinvestment in health care has served to slow the
deterioration of the system. However, these reinvestments have
failed to keep pace with population growth and inflation. In
fact, spending in real terms fell by $115 per person between 1994
and 1995 and 1998 and 1999 once the figures were corrected for
creative accounting. Real per capita spending on health care by
the province fell every year in this period.
Nurses believe that
financial reinvestment alone will not solve our health care
system ailments. We must reinvest in programs that will lead to a
solution of our problems instead of funding temporary solutions
or quick fixes. For example, the repeated emergency room crises
will be resolved only by reinvesting in programs such as primary
health care, long-term care and home health care. The inability
to discharge patients from hospital in a timely fashion will be
resolved only by adequate levels of home care services.
Appropriate bed utilization within our hospitals necessitates
further development also of our long-term care facility sector.
In our submission we have presented an analysis of current
budgetary constraints.
In summary, we know that
the immediate economic future, although uncertain, has something
clear-uncertainty-and thus we need to prepare for it. Most people
expect the economy to slow and tax revenues to decline in tandem.
There is little room for government to cut expenditures, as they
have already fallen in real per capita terns by 7.3% over six
years. Indeed, there is considerable need for government to
reinvest in neglected areas of physical, human and social
capital.
This raises the issue of
tax cuts. We know that the government has spoken of cutting taxes
further than they have done so already. If fully implemented,
however, it is our estimate that these costs could be as high as
$9 billion for the treasury. Given the prospect of declining
revenues and a need for more spending, the slim budgetary surplus
could quickly turn into a large deficit. It is with this in mind
that we recommend strongly against implementing further tax cuts
at this time.
This is not to say,
however, that we should not change the way we collect taxes. It
is desirable that taxes be as efficient as possible and distort
correct prices as little as possible. Taxes that correct for
market imperfections will be desirable. For example, the market
over-provides environmental destruction and harmful substances.
Green taxes, for example, and tobacco taxes could both help to
correct under-pricing of harmful activities. Federal taxes on
short-term destabilizing financial flows are another example of
this type of tax.
These corrective taxes
would serve two functions. They would reduce the harmful activity
and they would raise government revenues for programs that
already deal with the consequences of the remaining activity, for
example, treatment of lung cancer and heart disease.
There is also greater
fairness in using these taxes, in that it is the sinner who pays
for harmful activity. Whether these taxes are raised at the
federal or provincial level, the provinces would seem to have
some moral claim on a portion of them since they deliver the
remediation services.
RNAO recommends that the
government refrain from tax cuts until it designs other
sustainable tax revenue measures to replace the revenue forgone.
At this point in the business cycle, forgoing tax revenue is, in
our view, inappropriate and fiscally irresponsible. On the same
grounds, we urge the province not to push the federal government
for large tax cuts at this time.
RNAO also recommends that
the government move to increase taxes for those industries and
products that are detrimental to health. We mention green taxes
and increased tobacco and gasoline taxes as examples.
1440
We also want to leave you
with a clear message about privatization. With respect to health
care, the economics are very clear: public funding not only
guarantees universal access and better quality, but it is also
the cheapest way to fund health care. Research overwhelmingly
shows that public funding and not-for-profit delivery of health
care services is cheaper and of better quality than for-profit
provision.
The major nursing
organizations in this province have already publicly declared
their concern about the increased privatization of health care in
Ontario and Canada. Ontario is leading in that trend. This is a
particular problem in the areas of home care and long-term
care.
We also have growing
concerns about privatization in the hospital sector. These
concerns are about both cost and quality. Quality in health care
has long been recognized as a problem in for-profit provision,
because it is very difficult to monitor. For-profit providers
have a perverse incentive to cut corners on those components of
care that are difficult to monitor.
We are alarmed over the
government's move to fund a for-profit agency to deliver
radiation therapy in hospitals. We are concerned not only about
the potential for greater costs, but also the risk of bleeding
health care professionals from the public and not-for-profit
sectors. We are also alarmed about recent statements by the
Premier and our new minister that the government is encouraging
greater privatization within the health care system. We believe if we continue this
trend, it will cost both in money and in quality, and also in
moral terms and social cohesion.
RNAO repeats the call made
last year by the major nursing organizations across Ontario for a
moratorium on privatization of health care services in this
province. RNAO calls upon the government to recommit itself to
the principles of the Canada Health Act, which are very clearly
stated in the Blueprint and in the throne speech, and to publicly
reject movement to an American-style privatized health care
system. RNAO joins the Premier and the opposition parties in
their request for a full audit of the decision by Cancer Care
Ontario to pay a private company to run an after-hours radiation
clinic at Sunnybrook hospital.
Having the right
infrastructure is essential to economic sustainability and
prosperity. The market tends to under-provide certain
infrastructure-for example, transportation networks, schools,
hospitals, water treatment facilities etc-because the market
cannot generate appropriate incentives. Governments have
traditionally had to step in to fill the gap.
Government cutbacks and
private sector restraint have resulted in a decaying of this
infrastructure, to the detriment of the productivity of our
society. When governments correct for the under-provision of
infrastructure, they are engaging in market-friendly activity. So
long as it is done efficiently, most sectors in the economy
welcome this activity. It is long overdue for provincial
governments to start to address the erosion of infrastructure in
a serious way.
Long-term-care commitments
were made in the 1999 Ontario Progressive Conservative Blueprint
to raise health care spending by 20% over five years.
Furthermore, the government struck a task force to obtain
recommendations on the major component of health care delivery:
nurses. It accepted all of the task force's recommendations and
established the implementation process which all nurses are
monitoring currently closely. It has been gratifying to witness
the evident desire of Ministry of Health officials to
successfully implement these recommendations. I would like, on
this note, to commend Minister Witmer for her personal commitment
to the nursing profession within the nursing task force
recommendations, and the Premier.
I would like to speak now
specifically about our profession. The RNAO is gratified to know
that in poll after poll the public is solidly supportive of a
publicly funded, not-for-profit delivered health care system and
that nurses are seen as the most trusted of all health care
professions. This has been the case not just lately but for the
last five years. These public opinion barometers have
consistently identified nurses as having the greatest influence
on the day-to-day quality of care. My colleague from OHA who I
saw sitting here knows that's the case, and we should take that
seriously because detriments to the nursing profession impact on
how the public perceives health care.
However, many of these
surveys have also identified growing public concern about health
care issues along with a keen desire to maintain this most
cherished of public services. Also evident in these surveys is
the high degree of concern about nurses' work circumstances.
Opinions include concern that nurses are overworked, along with
support for enhanced and dedicated funding for the nursing
profession. RNAO acknowledges the concern and support of the
public on these issues and we suggest that their opinions lend
great urgency to our message today.
We would like to
acknowledge the actions taken thus far by government in
addressing the concerns of nurses. The reinvestments that have
been made constitute a positive step. Recent College of Nurses
data-and this may be news for all of you-indicate that nursing
employment increased by over 5,500 positions, both RNs and RPNs
together, over 1999 figures. While this is good news, we remain
far short of our target of 12,000 new positions by the end of
2000.
However, nurses continue to
report workloads that are frequently unsafe and unbearable,
frustration and a sense of powerlessness over the inability to
enact best practices due to lack of time, and anger over working
conditions and the prevalence of casual employment, which both
causes insecurity and makes it harder to deliver continuous
quality care to patients and clients. Having to deal with
improper equipment and a decline in the availability of materials
used to provide care is another concern that nurses continue to
mention.
The competitive bidding
home care sector process has also created frustration, fear, and
insecurity of employment, and is making nurses leave the home
health care sector in favour of the hospital sector.
We know these circumstances
continue to drive many nurses out of the province, out of the
country, or out of nursing altogether. Tomorrow morning we will
be addressing that issue at our press conference, which has some
good news.
We need the government to
continue to support the nursing profession, and together we need
to continue to serve the people of Ontario. In the next section,
I will provide specific recommendations about critical
investments.
First of all, the labour
market: the government has taken steps in the right direction
with its commitment to hire 12,000 more nurses in permanent
employment status. There are other important steps that are
necessary in order to recruit nurses to positions that will
enable them to provide needed care to the residents of
Ontario.
The government must
continue to flow earmarked funds, with clear accountability
mechanisms. Those mechanisms were not in place previously, and we
urge you to put them in place until the RN-population ratio is
comparable to the rest of Canada. As you know, we have the lowest
nurse-per-population ratio in the country here in Ontario.
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We urge the government to
flow funds to health care agencies in a manner that will
facilitate long-term planning of health care delivery. This is
true for the hospital sector, this is true for the long-term-care
sector, and this is especially true in the home care sector.
We commend the government
for sponsoring career days and job fairs. These have proven to be
most successful in matching nurses with employers, and indeed we
have matched thousands of them. We are heading on Monday to Texas
to bring our Ontario nurses back home. We urge the government to
continue to fund this and other important recruitment
initiatives.
Let me talk for a bit about
the work practice environment. Along with recruitment
initiatives, we must focus on initiatives that will keep nurses
in our province, those who are currently here, and not continue
to bleed them to other countries. The work environment
difficulties experienced by nurses in all sectors include:
replacement by unregulated care providers; a move to part-time
and casual employment; a move to temporary contract positions;
poor staffing patterns in the context of increased patient
acuity; and funding that does not keep pace with need.
In that sense, let me give
you a touch of the latest research that is coming from the
management literature in relationship to what is called
contingent workers or contingency work, which was initiated in
the US under the impression that it would cost less and provide
as good quality care, and efficient care, because you didn't have
the benefits etc. The latest in the research is that it is
actually costing more and that people are losing their
commitment, their contract with the organizations, their
motivation, and therefore their productivity. So that's important
to keep in mind.
Also, too many of our
nursing professionals are curtailed in practising to their full
scope of practice by outdated and inefficient regulations.
Wage disparities between
the community and hospital sectors are a substantive barrier to
ensuring efficient utilization of the home care and hospital care
sectors. Basically, hospitals cannot discharge patients because
they don't have sufficient nurses in the home care sector. Nurses
are escaping that sector to go to the hospital sector because
they are better paid, simply said. Nurses working in the
community face wages that are 20% to 25% lower than their
colleagues in the hospital sector. So the recipe is there for
them to move from one sector to another, regardless that it may
be better clinically for them to stay in the home care sector.
This is causing severe recruitment and retention problems and
poor continuity of care in the home care sector. In turn, it is
affecting the ability of hospitals to discharge patients in a
safe and timely manner, since community services are often not
available, not just on weekends and holidays, as it used to be a
year ago, but actually in the middle of the week now.
The situation of nurse
practitioners requires particular attention. The government has
taken the important step of recognizing their extended scope of
practice and funding some positions. We urge the government to
follow the commitment in the Blueprint to aggressively put more
nurse practitioners across the continuum of care. We are asking
for funding for 200 nurse practitioners who are currently either
unemployed or underemployed and are at risk of losing their
certification with the College of Nurses. We trained them-you
paid for it-but we may lose them because the funding is not
there.
I think I will stop. The
recommendations are very clear. We are asking for mechanisms to
fund the various health care sectors so that they can have more
full-time nurses. We have recommended that 70% of the nursing
workforce be on a full-time basis. Then you will decrease the
need for so many more nurses and you will also increase their
retention.
We are also asking for the
200 nurse practitioners who are unemployed or underemployed to be
fully funded, rather than the 75 that the expert panel is
recommending for the year, because you are going to lose the
remaining 125. In fact, some of them are already moving to
Saskatchewan and other places.
We are also asking for
continuing funding for the best-practice guidelines. We commend
the foresight of funding that initiative.
We are asking for one-time
funding to develop, evaluate and test orientation prototypes in
the hospital sector and in the home care sector.
We are asking for one-time
funding of $1 million to develop a pilot test to evaluate
teaching units, with clear criteria for RFP, which will provide a
perfect venue across the province to create positive work
environments and merge the best of senior nurses with the newly
graduating baccalaureate nurses.
I will stop.
The Chair:
With that, unfortunately, we have run out of time for questions.
On behalf of the committee, I thank you very much for your
presentation this afternoon.
ONTARIO LONG TERM CARE ASSOCIATION
The Chair:
Our next presentation is from the Ontario Long Term Care
Association. I would ask the presenters to come forward and state
their names for the record. On behalf of the committee, welcome.
You have 30 minutes for your presentation this afternoon. You may
proceed whenever you're ready.
Ms Vida
Vaitonis: Thank you for inviting us here today. My name
is Vida Vaitonis. I am executive director of the Ontario Long
Term Care Association. With me are David Cutler and Fraser
Wilson, members of the board of the association.
We represent 330 of
Ontario's long-term-care facilities, including private,
not-for-profit, charitable and municipal organizations. The homes
we represent provide care and accommodation for more than 32,000
people. An equal number of staff work in these facilities.
The entire long-term-care facility system in
Ontario includes 498 homes that care for approximately 57,000
people. OLTCA members thus account for roughly 66% of Ontario's
facilities and 56% of residents. Much of the system's remainder
is made up of homes represented by the Ontario Association of
Non-Profit Homes and Services for Seniors.
Founded in 1959, OLTCA was
originally known as Associated Nursing Homes Inc of Ontario, and
later as the Ontario Nursing Home Association. Nursing homes have
a long and honourable record of partnership with the government
of Ontario. For decades, our members have worked closely with the
Ministry of Health and Long-Term Care, as it is now known, to
ensure that Ontarians who need facility care can get it at a
reasonable cost to themselves and to the system.
For the benefit of the new
faces on the committee, let me explain just the basic facts about
how our sector works.
While long-term-care
facilities can be privately owned or operated by a municipality
or a charity, all facilities operate under the same regulations
within very tight governmental control. Government financing
drives our capital budgets. If we want to expand or upgrade, we
face a complicated ministry approval process. The government sets
our operating revenues as well. The ministry grants our homes
approximately $55 per resident per day for nursing and programs.
Residents pay approximately an additional $43 for accommodation
services, a rate set by the government. Preferred accommodation
is offered to them for up to $18 per day, but the government sets
the rate and the proportion of preferred accommodation that
facilities can offer. The amount of physical space we offer
residents, the level of care they receive, the number of food
service workers, the content of meals: each and every one of
these factors is closely controlled by government rules and
funding mechanisms.
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Let me tell you why we're
here today. We are here because people are expecting us to play
an expanded role as lynchpin of the health system, and we have
some challenges to meet if we're going to fulfill that role.
Let me explain. We all know
that our society is aging. Elderly people and those with
disabilities need care, and there are only three ways to deliver
it to them: in their homes, in hospitals, or in long-term-care
facilities. Hospitals cost too much to be delivering long-term
care-sometimes up to $800 per day-and are really designed to deal
with acute medical cases, not the type of care required by people
who are simply aging or disabled and are unable to care for
themselves. For this reason, hospitals are a very inefficient and
inappropriate means of caring for our elderly, but often they
have been the only recourse to which families can turn. As a
result, we have the phenomenon that some refer to as "bed
blocking," in which people who do not need acute care remain for
extended and costly stays in hospitals while they wait for a
long-term-care-facility bed. This creates a backlog at the
hospital's front door-the emergency room.
By building a strong
long-term-care sector, we can put an end to the so-called
bed-blocking that exists today. A strong long-term-care system
will also create places that will be filled as our population
ages. We offer the means of both easing current system problems
and meeting the brunt of future demand. This is what the
government of Ontario recognized in April 1998, when it announced
it would build 20,000 new beds over six years. As the Premier
said at the time, "We are taking the necessary steps to build a
health system that will meet the current and future needs of our
growing and aging population, and ensure that Ontarians have
access to the highest standard of long-term care.... This
investment will strengthen community services for the elderly,
improve the quality of life of people who live in nursing homes
and homes for the aged, take pressure off hospitals and emergency
rooms."
The Premier was right then
and he's right now. A month ago, he affirmed that vision of a
health system in transition in an interview with the Toronto Sun:
"If you look in health care, the big challenges we faced were to
keep pace, modernizing hospitals, long-term care. They were built
on a 50-year model that every hospital had to do everything...."
We want to play the role the Premier envisions for us. We are
stepping up to the plate, bidding for the new beds, seeking
financing from our bankers to carry our share of the costs and
reconfiguring our business to fulfill this new mandate.
But building more beds
isn't enough. We need the operating funding to make them better
beds, to make them beds in which you would want your parent to
live out his or her life, or one day to go into yourself, knowing
you'll get the care you'll need. Right now, we all know that the
level of care is not what we want it to be. It is below what I
believe any of you would be comfortable with. And this problem is
only going to get worse as our resident base ages and needs
ever-increasing amounts of care: 10 years ago, our average
resident was 76 years old; they are now 86. The resident of
tomorrow needs more hands-on care and that means we need more
hands on deck.
We have been working
closely with the Ministry of Health and Long-Term Care to try to
define the current situation and to determine how much more is
needed to bring care to an appropriate level based on current and
future needs. Our belief is that the government will need to
increase operating funding by between $500 million and $600
million over three years. This is what we will need to provide
Ontarians with an acceptable level of care.
We are under no illusions
regarding the magnitude of this request. We are well aware of the
fiscal pressures that the government faces at this point in the
business cycle. Why, you might ask, can't this wait a little
longer? Well, the new beds are coming on stream. Demand is being
stimulated. The public is knocking at our door. We will build the
new beds you have asked us to build. But if we build it, they won't necessarily come-not
without the appropriate level of care. As long as people feel
comfortable accommodating loved ones in expensive hospitals or at
home with insufficient resources, they will choose to do so.
Patients will remain in expensive hospital settings, ultimately
creating backlogs at the hospital front door-the emergency
room.
Now is the time to prevent
this kind of situation from occurring. Now is the time to work
together and build a long-term-care system that can ease
so-called bed-blocking and meet the challenge of an aging
population. Demographic and medical pressures are mounting.
Demand is increasing. Inflation and other cost increases have
taken their toll. You have asked us to play an expanded role. We
are excited about playing that role, and excited about working
with a new Minister of Health and Long-Term Care. We are excited
about the kind of system we can build if we can get the operating
funding we need.
The issue here is not beds;
it's level of care. The issue here is not wages; it's the level
of service. The issue is not the past; it's the future. The issue
here is not whether, but when, and the answer is right now. We
want desperately to fulfill the role Premier Harris has set out
for us. We are working intensively with ministry officials to
find a way to get these needed funds into our system. We are
taking our message to MPPs, cabinet ministers and central
agencies. We seek not to threaten or shame the government into
action, but we must deal with this issue now.
The Chair:
We have five minutes per caucus, and I'll start with Mr
Christopherson.
Mr
Christopherson: Certainly, no matter where on the
continuum of health care, we see enormous pressures. We've heard
from virtually all of them. You will know from the morning paper
that the Premier was quoted yesterday as saying that they are
planning to ratchet down spending rather than back off on the tax
cuts in order to try to offset the downturn to maintain a
balanced budget. There are so many pressures in the health care
system, one has to wonder where there aren't pressures for
increase.
But if you take the Premier
at his word, then what he's saying is in the health ministry,
like every other ministry, where you're responding to population
pressures, cost pressures, aging population pressures, whatever
those legitimate built-in pressures are that are forcing
increases in the Ministry of Health, without expanding, just to
meet the current demand, in order that everywhere that that's
happening, if the minister chooses to go that way, there has to
be a corresponding cut.
One would assume normally
when you make that kind of statement that you're going to
increase in a strategic area and then cut in an area, hopefully,
that won't have any impact, either through re-engineering your
services, new technology, something that would render it
non-harmful to the public. I've got to tell you, when it comes to
the key areas that are affecting us right now-whether it's
environmental protection, social services, health care or
education-I can't imagine where those offsetting positions are.
Assuming that they go full ahead in this direction and attempt to
meet needs in the health ministry, where, in your opinion, in the
continuum of health care, can the ministry afford to cut in order
to put in new?
Ms
Vaitonis: Our position and our mandate is to identify
the needs. Our issue and our mandate is not to find the dollars
within the health system. We know that there are tremendous
pressures on all fronts. Our job in coming here today is to
identify the areas that we feel are most pressing in the
long-term-care field, and we've tried to identify the amounts
that are going to be needed over the years to come.
Mr
Christopherson: I don't imagine anybody can answer that.
I didn't expect you, really, to have an answer. I wanted to give
you the chance, because if it's that obvious-often the Premier
accuses the opposition of not seeing the obvious-maybe I'm
missing the obvious. But I don't know where it is within the
Ministry of Health budget, based on what we've heard for the last
two weeks, that they can afford to cut if that's the price to pay
to increase where we need it. Obviously, your needs are
legitimate and so is every other point of contact along that
continuum of care.
Whether we're talking the
hospital sector-they were just in here this morning talking about
the $400-million to $500-million pressure that's on them just to
maintain-or through to the home care, where the wages are so out
of whack that we can't attract nurses into that field and we
can't keep them. I would argue a lot of that has to do with
privatization and the managed competition which is forcing the
price of nurses in that part of our continuum down. Nonetheless,
at the end of the day, the only way the strike at the VON in
Hamilton got resolved was that the ministry coughed up some more
money so they could pay at least some of the wages that are due
those nurses. Everywhere I look in the health care ministry,
whether it's the emergency room and the ambulance end of it or
providing the acute care on the ward, I don't know where they
would possibly cut if they were to recognize, quite rightfully,
that your area of the continuum of health care needs money and so
does every other area.
1510
You've got to get your head
around this: the world has changed from the day we said, "Come on
in and see us," to the day you actually got here. When we started
out the process we were up over 3% GDP expected, with a
$1-billion surplus and a debate about where that's going to go,
to now hanging on with our fingernails trying to figure out how
this province is going to maintain the standard of living, as
depressed as it is for some folks, at the same time the
government is going to spend more money on more tax cuts and
somehow magically that's going to solve all this.
I realize there's not
really a question in there, but if you've got any thoughts-you're
just showing up that whole vision that says to us we're in
serious trouble. What
we ought to be doing is backing away from the tax cuts and then
making sure that whatever money is available is going into
priorities like health care, because it's a good investment as
well as being the right thing to do in our society.
Mr David
Cutler: Mr Christopherson, all we can say is that we've
identified this need. We don't know where the money is to come
from, but it's our obligation to bring this to the attention of
the government and we've done that.
Mr
Christopherson: Absolutely. You've done an excellent job
of that. Thank you.
Mrs
Molinari: Thank you very much for your presentation.
You've highlighted some of the concerns and issues around
long-term care. Certainly as a government we've made some changes
and initiatives to provide for some of the needs that are going
to be emerging in the years to come, and one of them is of course
the need for long-term care. The hospital restructuring committee
in their review also made several recommendations, and as a
government we have responded to a number of those. The creation
of 20,000 new long-term-care beds is one area that we've
responded to. Certainly there has been funding put in to also
inspect some of the long-term-care beds throughout the province
to ensure the quality, because you also indicated in your
presentation that it's not only having the beds but being able to
have quality service provided for those in that need.
In my riding the Reena
Foundation has an elder home that's for the disabled elders and
they provide an excellent service in long-term-care needs for
their clients, certainly supported through various ministries
provincially. They've also done a number of other initiatives
that have given them accessibility to additional funds, either
through fundraising or a number of other initiatives. It's an
organization that I certainly talk about as often as I can and
highlight the wonderful work they're doing in co-operation and in
partnership with all of those that are responsible, because
certainly we need to work together in any way we can to provide
for those who need our help. Governments can't do it alone. It's
not something that is the sole responsibility of the provincial
government. Our view has always been that in order for a
government to be able to assist those in need, we need to have a
good economy, we need to have the funding in order to provide for
that economy.
A number of presenters who
have come forth in the last-I guess this is the eighth day, and
there have been varying views on how to create that strong
economy. One of our beliefs as a government is that tax cuts
create the strong economy, create jobs, and the more jobs you
have, the more people are paying taxes and the more money you
have to invest in services like long-term care and a number of
other social services.
Certainly some of your
recommendations and some of your comments will be taken into
consideration with all of the others that come forth, and I
congratulate you on the work that you do with respect to this
area. Thank you for taking the time to come and make the
presentation here today. I know my colleague Doug Galt also has a
question.
The Chair:
Mr Galt, you have a minute and a half.
Mr Galt:
Thank you for your presentation, bringing forward to us the
amount to make this whole thing fly.
There's one player not at
this table. You people are here, we're here as a province. The
other player that is not here is the federal government. I'm
wondering what your presentation would be like to them, because
as it started out, the previous group wanted us to recommit to
the Canada Health Act. I think the Ontario government is
committed very much to the Canada Health Act, although it doesn't
appear that the federal government is, because they've reduced
from the 50% funding that was a commitment at the beginning of
the act, when it was first proclaimed. At the end of the
Conservative era it was down to 18%. I don't know when it slid
before that, at what rate, but in 1993 it was at 18%, when
Mulroney turned it over to Chrétien, and now it's gone to
7%. With great fanfare it came back up to 11%. What is your
presentation like to the federal government when you go to their
finance committee? What are you asking them to do?
Ms
Vaitonis: In fact we don't normally go to the federal
level since we are a provincial association. We haven't to date
done so. Certainly funding from whatever source and whoever's
responsibility it is needs to come forward and support the Canada
Health Act altogether in all the care that's delivered throughout
Canada. We're very much hoping that all the resources that are
available, whether at the federal level or at the provincial
level, will come forward to support the care that needs to be
delivered.
Mrs
McLeod: I won't waste the valuable time we have with you
to debate over Mr Galt's statistics, but I do want to talk to you
about the financial needs that you've set out for the
long-term-care facilities in the province. I'm particularly
sensitive to the plea that you're making, because we're in the
midst of long-term-care forums across the province and we're
hearing regularly from both family members of people in
long-term-care facilities and from staff members about their
concerns with quality of care. I have to tell you that every time
somebody speaks to us they speak about the commitment that's been
made by staff even though the staff are obviously working beyond
their stress levels. It's staff who are saying that they are
really concerned about the safety of their patients-not just
quality of care but safety. That makes me very responsive to the
plea that you've made here for more adequate funding for
long-term care.
I wanted to ask you
specifically, when you talk about $600 million, because you say
over three years, is that an estimate for what you would need
annually, so it's $200 million in each of three years, or is it
$200 million accumulating as you add new beds to the system so
that by the end of three years with new beds on stream the
increased cost is $600 million?
Mr Fraser
Wilson: Essentially what we've looked at is, we have
costed out what we know, and what we know today is that 57,000 beds are in the system.
What we have not done is anticipate the addition of the 20,000
new beds because we don't know exactly when they are going to
come on stream and we want to look at it from that perspective.
What we also know is that the day of large group activities is
gone. With our residents, there is a far greater need for
one-on-one programming because of behavioural challenges that
come with cognitive impairment. As to how we stage the funds over
a three-year period, we look forward to working with government
to make that happen.
Mrs
McLeod: So this is to improve quality of care for
current residents without anticipating the new beds coming on
stream.
Mr Wilson:
That's correct.
Ms
Vaitonis: The only caveat I would add to that is that it
also allows us to step up to the new role that we need to
undertake as the system unfolds and the reform takes place, where
we take on more complex care.
Mrs
McLeod: I was going to ask, is part of that new role and
part of the need for increased funding for quality care because
as chronic hospital beds are being shut down, with some reversals
on that front, long-term-care facilities are being asked to
undertake more complex care, such as psychogeriatrics and
Alzheimer's patients, without having seen a corresponding
increase in the level of support that you can provide?
Mr Wilson:
That's correct. That takes us to a higher level of service to
meet that complexity of care.
Mrs
McLeod: Right. How many new beds have actually come on
stream in the last three years since the 1998 announcement?
Ms
Vaitonis: The first beds that were to have been built
came out last fall.
1520
Mrs
McLeod: As a successful bid but not actually up and
running?
Ms
Vaitonis: No, up and running actually, approximately
1,000 to date. We're predicting that this year a little more than
4,000 will come forward and the rest will very quickly flow after
that.
Mrs
McLeod: Have you had a corresponding per diem increase
in your funding to accommodate all of those new individuals?
Because we're now no longer talking about capital bids; we're
talking about people in your institutions. Have you had a per
diem increase or have you just had a constant change in the case
mix index so that it shifts from facility to facility but the
overall budget isn't actually increasing to take into account
those 1,400 new beds?
Mr Cutler:
We haven't as of yet had an increase. There's been no change in
the per diem rate and there's no distinction between the old and
the new facilities. The per diem funding based on your CMI is
exactly the same.
Mrs
McLeod: Has the total global funding for long-term care
facilities increased by an amount commensurate with 1,400 new
beds?
Mr Cutler:
Yes, that has definitely increased.
Mrs
McLeod: One of the concerns we hear, and you've touched
on it, you've alluded to it in your brief, is that there are no
longer minimum requirements in terms of minimum number of nursing
hours and there's a real concern about having registered nurses
on staff in adequate numbers. Is the funding you're proposing
going to address that? Is that one of the issues that can be
addressed?
Mr Cutler:
Yes, that most definitely is one of the issues that will be
addressed. We realize that we need to increase the mix of
professional staffing to non-professional staffing so that they
can take on the increased complexity and acuity of care level
that's expected of us.
Mrs
McLeod: My other question would be, how far beyond the
minimums can you go? We were hearing concerns that minimum
staffing is not in place because it's no longer in the act and
it's no longer funded. But it seems to me we have to go far
beyond that, if we're talking about a quality of care, to include
things like non-nursing professionals, occupational therapists,
physiotherapists, which are almost a dying breed in
long-term-care facilities these days.
Ms
Vaitonis: We believe that our projections in our
document here address that need.
Mrs
McLeod: Is it outlined anywhere, all the components of
your request for the $600 million over three years?
Ms
Vaitonis: We've worked within our association with the
ministry on a variety of studies. There isn't one comprehensive
overall study that we're able to share with you at this time, but
we would be working toward something like that.
The Chair:
On behalf of the committee, thank you very much for your
presentation this afternoon.
CANADIAN FEDERATION OF STUDENTS
The Chair:
The next presentation is from the Canadian Federation of
Students. I would ask the presenters to come forward and state
your names for the record. On behalf of the committee, welcome.
You have 30 minutes for your presentation this afternoon.
Ms Erin
George: Thank you very much. My name is Erin George. I'm
the Ontario chairperson for the Canadian Federation of Students.
We represent 185,000 undergraduate, graduate and college students
in Ontario and 400,000 across the country. With me today is our
government relations and campaigns coordinator, Pam Frache.
We have a submission and
what I would like to do is read parts of the submission and our
recommendations, and then hopefully there will be time for
questions at the end.
While there is a general
acknowledgement of the growing importance of colleges and
universities, this government's response has been to slash
funding for higher education in an unprecedented way. For the
1996-97 school year alone, Ontario's colleges and universities
lost $400 million in funding, a loss that translates in constant
dollar terms to approximately a 17% cut. Since then, public funding for
post-secondary education has been marginal. As it stands, this
government's funding policy will ensure that Ontario's colleges
and universities remain the worst-funded higher education
facilities in the country today.
The impact of this
financial situation for the quality of post-secondary education
is all too evident. Most colleges and universities are now
operating with diminished faculty and support staff complements.
Hiring freezes and layoffs constitute the norm across the
province. Class sizes have grown significantly, resulting in less
interaction between students and their instructors, while
educational choices have been sharply curtailed by a host of
course and program cancellations. Libraries do not have the funds
to maintain book holdings at needed levels. Building repairs
cannot be made or are delayed, posing health and safety threats.
Equipment is out of date.
Underfunding has also
impeded co-operation among institutions and created an unhealthy
turf environment in which institutions point fingers at one
another in their efforts to minimize the impact of funding cuts
on their particular institutions.
Cuts to public funding of
post-secondary education have also resulted in institutions
depending more and more on alternative sources of revenue.
Institutions have sought, and the government has approved,
massive tuition fee increases. In addition, Ontario's colleges
and universities must now rely heavily on corporate generosity in
order to remain viable. However, such reliance comes at a price.
In return for funding, corporations are demanding a greater say
in the day-to-day business of our colleges and universities and
dictating policy decisions regarding curriculum. With alarming
frequency, we are seeing pockets of our public institutions being
privatized and funds going toward financing what amount to job
training programs for the private sector.
Relying on private sector
funding to fill the core funding gap left by government cuts sets
a dangerous precedent. Private sector funding is neither stable
nor comprehensive, since it is often of a short-term nature and
geared to specific programs or projects. At best, it brings
temporary relief to a problem of underfunding that desperately
requires a long-term solution. More frequently, it compromises
the quality of the educational experience by replacing broad and
diverse program offerings with short-term corporate
interests.
In this regard, we would
bring attention of the standing committee on finance and economic
affairs to a study done by Robert C. Allen, a University of
British Columbia economist, entitled Educational and
Technological Revolutions: The Role of the Social Sciences and
the Humanities. In the study, released by the Social Sciences and
Humanities Research Council, Allen describes humanities graduates
as having rates of employment and earnings on par with, or higher
than, most business graduates and those graduating in
high-technology fields. In fact, he argues that the so-called
technological revolution is increasing labour market demand for
university graduates in the social sciences and humanities.
These findings are in
direct contradiction to the policy, tacitly endorsed by the
Ontario government, of providing more funding and extra spaces
for high-technology programs at colleges and universities while
devaluing and eroding program funding in the arts and humanities.
In light of this report, we would caution the provincial
government that a continued overemphasis on high-technology,
private sector job training to the detriment of other programs is
a shortsighted strategy when considering the real economic needs
of the province.
The government's recent
decision to allow private universities to grant degrees will
undermine the quality and accessibility of public universities.
While the government claims that private universities will
provide "niche" services for a "niche" market, the federation
maintains that private universities will essentially put
post-secondary education on the market. Because private
universities will, by definition, be mostly dependent on user
fees for their funding, the result can only be higher tuition
fees charged to students, combined with deteriorating quality,
since this is the scenario most likely to generate the profit
necessary to keep private companies in business.
The impact of trade
liberalization agreements on the operation of private
universities has been articulated by the federation elsewhere. We
reiterate our concern that by opening up public services to the
international marketplace, we are jeopardizing the long-term
funding prospects of our public institutions.
The Canadian Federation of
Students recommends that the government of Ontario should provide
adequate funding for post-secondary education in Ontario. As a
minimum requirement, funding for Ontario's colleges and
universities should be no less than the national average.
The government of Ontario
should improve funding for research without reliance on the
private sector.
The government of Ontario
should cease measuring the quality of post-secondary education
based on perceived private sector demand. As such, it should
ensure that curriculum is neither determined by the private
sector nor focused solely on high-technology fields and must
cease using short-term private sector employment priorities as a
way of penalizing programs offered at public post-secondary
institutions.
Finally, the government of
Ontario should abandon its commitment to allowing private
universities to grant degrees in this province.
1530
Ontario has consistently
lacked a coherent tuition fee policy. Instead, tuition fee levels
have largely depended on the provincial government's willingness
or unwillingness to fund post-secondary education. It is
therefore not surprising that students have borne the brunt of
the recent cutbacks by way of massive tuition fee increases.
Tuition fees have increased by over 150% for university students
and over 140% for college students in the last decade. The
largest increases have occurred most recently. By the end of this
government's first mandate, it was responsible for a 53% college
tuition fee increase and a 60% university fee increase.
The increases in tuition, combined with declines
in earnings and savings, mean that many avenues traditionally
open to students for financing their education are now closed.
Many families or individuals can no longer fund post-secondary
education through their savings, while a bleak employment market
makes the prospect of saving enough to go to school a near
impossibility. Many people are now looking at the cost of a
degree or diploma and deciding that it is no longer an option for
them. Many others, already part way through their program of
study, are realizing that they can no longer afford to continue.
In either case, the accessibility of Ontario's post-secondary
education system is progressively deteriorating.
To make matters worse, the
Ontario government, in its 1997 economic and fiscal statement,
announced the complete deregulation of tuition fees for graduate
and professional programs at universities, for post-diploma
programs at colleges, and for other high-demand college programs.
The deregulation of entire programs of study within publicly
funded institutions has meant massive tuition fee increases.
Already, students entering deregulated programs are seeing
increases of 20% to 400% in one year. Consequently, we are well
on the way to creating a two-tiered system, where the only
criterion for enrolment in certain programs hinges on a student's
ability to pay. Studies are already showing that students from
lower socio-economic backgrounds are being disappeared from
programs where tuition fees have been deregulated. Furthermore,
Statistics Canada's Education Quarterly Review shows the
following:
"One of the most
significant findings of the current trend analysis is that there
has been a widening gap in university participation by family
socio-economic status (SES) as revealed in the 1986 and 1994
General Social Surveys.... By 1994, a wide gap had occurred
between [low and middle SES]....
"Our findings suggest that
university participation rates have not increased as fast for
young people from low family SES background. This factor combined
with the increase in tuition fees has created a widening gap
between them and young people from more affluent family
backgrounds. This finding may have important policy implications
surrounding issues such as accessibility and the equality of
opportunity."
There is no doubt that
these and other findings have motivated the governments of
British Columbia, Manitoba, Saskatchewan, Quebec, Prince Edward
Island and Newfoundland to freeze or reduce tuition fees in their
provinces.
The Canadian Federation of
Students recommends the government of Ontario should take the
lead of the majority of provincial governments and implement an
immediate tuition fee freeze.
The government of Ontario
should also re-regulate tuition fees for all programs at public
post-secondary institutions and set fees for those programs at
levels comparable to that which existed prior to
deregulation.
While the most recent
statistics show that the overall proportion of university
graduates indebted to student loan programs has decreased
slightly, we would argue these changes are more likely the result
of changes to eligibility criteria for student financial
assistance, and the fact that certain students who would have
accessed student aid have abandoned pursuit of post-secondary
education. Nevertheless, the total debt load of students
continues to grow. In fact, studies show that two years after
graduation the amount owed to student loan programs has increased
by 69% for university students and 89% for college students when
compared between 1990 and 1995.
There are reasons for the
escalating levels of student debt. Skyrocketing tuition fees have
certainly had an impact, as have bleak year-round employment
prospects. In addition, the Ontario government cut virtually all
forms of grants in 1993-94, thereby forcing most students to rely
solely on repayable student loans. Canada is one of only two
Organisation for Economic Co-operation and Development countries
without a national system of student grants. The combination of
these factors on student debt in Ontario should not be
underestimated. As it stands, Ontario's post-secondary students
are graduating with some of the highest debt loads in North
America.
Students wishing to pursue
a post-secondary degree or diploma have been required to amass
greater and greater debt loads in the form of repayable loans.
For many current and prospective students, the prospect of
incurring what could amount to lifelong debt is inconceivable.
They are simply left with the option of dropping out of
post-secondary education or never applying in the first place.
From a larger economic perspective, we would also question the
logic of saddling students with immense debt loads at such an
early stage in their lives. A generation of massively indebted
graduates does not make for a bright economic forecast.
Unfortunately, this
government's response to the growing need for adequate student
assistance, including viable debt reduction strategies, has been
the introduction of measures that actually increase student
indebtedness and make it more difficult for needy students to
access the financial aid they require. Some of the changes have
included disqualifying part-time students from OSAP eligibility;
forcing students with parental responsibilities on to OSAP by
terminating their social assistance eligibility; virtually
dismantling child care bursaries; initiating processing fees;
requiring credit checks; and now threatening fines of up to
$10,000.
In addition, the
government's plan to allow private companies to sell degrees in
Ontario will not alleviate the student debt crisis, as the higher
tuition fees will undoubtedly force students to borrow more and
leave them with higher levels of accumulated debt.
The Canadian Federation of
Students recommends that the government of Ontario should provide
sufficient funding for student assistance to meet the needs of
Ontario's students. Such funding should be separate and distinct
from operating grants. The government of Ontario should also
offer an enriched Ontario student assistance program designed to alleviate
the debt burden currently facing Ontario's students. Such a
system should include upfront grants to help reduce the debt
loads carried by students; targeted assistance for students with
dependants and/or special needs; expanded work-study
opportunities for students to earn while they study; expanded
interest relief strategies and debt reduction measures to aid
students who experience difficulties during repayment and as a
way to reduce defaults.
As part of such an
undertaking, the government of Ontario must reverse the erosion
of the current OSAP system by providing adequate funding for
student assistance to meet the needs of students; restoring OSAP
funding for part-time students; restoring child care bursaries
for students with dependants; restoring access to social
assistance to students with dependants; revamping parental
contributions and dependency requirements to reflect current
student realities; ending the practice of charging user fees for
such things as OSAP information and applications; and ending
credit checks on OSAP applicants.
The government of Ontario
should also publicly and aggressively call upon the federal
government to implement a national system of needs-based grants
as an effective tool in the reduction of student debt.
With regard to the
millennium scholarships, the federation continues to be concerned
about the fact that federal dollars intended to reduce student
debt continue to be used by this government to pay for existing
programs. While a small concession was made last year allowing
students to realize $500 net debt relief, we believe this is not
enough. The Canadian Federation of Students recommends that the
government of Ontario must move immediately to ensure that all
funds allocated for the millennium scholarship go directly toward
reducing student debt in Ontario. No portion of the millennium
scholarship should be used to replace funding for already planned
or existing programs. The government of Ontario must account for
its use of millennium scholarship dollars through reporting
mechanisms that are transparent and publicly accessible.
In conclusion, the Canadian
Federation of Students has attempted to outline in this brief the
negative impact that funding cuts have had on the quality and
accessibility of Ontario's colleges and universities. The main
issues facing students today are a direct result of the erosion
of government funding to post-secondary education, and this must
be our primary concern. We believe that the provincial government
must play a more effective role in ensuring that students across
Ontario have access to a publicly funded, publicly administered
post-secondary system. It must also ensure that such a system
offers a comprehensive range of programs and services and that
ability to pay is not a prerequisite for access.
1540
It has been estimated that
an additional 90,000 students will be entering the post-secondary
system over the next several years. It has also been estimated
that 15,000 new faculty will be required to meet the
instructional demand created by the elimination of grade 13 in
Ontario. Thousands of additional support staff will also be
required to maintain the facilities required to house the
incoming students.
To accommodate these
challenges, the Ontario government must make a commitment to
properly fund post-secondary education. This requires the
immediate restoration of the $400 million cut in 1996-97,
supplemented with additional funds for increasing the numbers of
faculty and support staff and for building maintenance. Such a
commitment allows Ontario's colleges and universities to meet the
growing demands placed upon them and would stop the trend of
increasing tuition fees in order to make up for government
funding cuts.
In addition, the provincial
government must reinforce its commitment to an equitable student
aid system, one that does not burden students with debt loads
that could take a lifetime to repay.
Thank you, and I look
forward to your questions.
The
Vice-Chair: Thank you very much, on behalf of the
committee, for your presentation. We have about two and a half
minutes for a response by each caucus.
Mrs
Molinari: Thank you for your presentation. Two and a
half minutes is not a lot of time to address some of the issues
you have raised here today, so I'll focus on just a couple.
One issue has to do with
your comments on tuition fees. Tuition fees have been brought
back to one third. It's a shared responsibility between the three
different parties, so the student is responsible for one third of
the tuition. I'd like to hear your feedback on what you think
that should be, if you think the government should be totally
responsible for that. The tuition fees have also been capped at
2% for the next five years. You've commented on the rising and
escalating of tuition fees. Those that have been deregulated are
in programs where the earning potential for the student, once
that student graduates, is certainly much more. The universities
have requested that this happen so that they can provide the
programs and not be constrained to set fees. That was in response
to some of the universities' requests.
Also in your presentation,
I noted you said, "The Ontario government cut virtually all forms
of grants in 1993-94, thereby forcing most students to rely
solely on repayable student loans." I find this interesting
because this is prior to our government coming into office. We
often hear opposition talk about what this government is doing
with respect to post-secondary education and education, so this
was an interesting piece of news in your presentation.
You also commented on
"threatening fines of up to $10,000 for students found guilty of
abusing OSAP." This in fact is for those who-
The
Vice-Chair: There's only 30 seconds left.
Mrs
Molinari: My question would be your comments on those
who abuse the system. Should nothing be done with students and
people who are deliberately abusing the system and taking
taxpayers' dollars, taking it away from those who are
legitimately entitled to it because of those who are abusing the
system?
Ms George: With respect to
tuition fees as a percentage of the operating budgets of
universities and colleges, according to the Council of Ontario
Universities and the ministry itself, tuition fees now account
for 37.2% of the operating budgets of our universities. A decade
ago that level was 19.5%, while, conversely, government grants
have gone from 75.1% to 52.3%. We think that division of
contribution to our universities and colleges is unacceptable.
It's actually more than double the percentage of tuition fees in
relation to operating grants in the United States, for example,
and 37.2% is even more than the Ontario government campaigned on
in its Blueprint document in the recent provincial election. That
level was 35%. So the government has now exceeded even its own
commitment during the provincial election.
The
Vice-Chair: I'm going to have to move on to the official
opposition.
Mrs
McLeod: It was interesting when Ms Molinari spoke about
the government's rationale in allowing deregulation in the areas
where presumably people can repay their loans after graduation. I
think what your brief was speaking to in terms of the impact of
higher tuition fees is the way in which it acts as a disincentive
for people ever getting into the programs.
I wonder whether or not
you're starting to see some studies, whether there's some
tracking about-you've noted a general study about the effect of
tuition fee increases on socio-economic levels of people entering
university and college. Are you starting to see that becoming
even more pronounced? For example, getting into medicine-I
understand there's a study at Western where the medical school
first-year fees are up to, I think, $14,000 this year-are you
starting to see that the level of family income of entrants is
getting higher and higher? I wonder if you could comment on
that.
Ms George:
Absolutely. The Western study is a key example of how
deregulation and the resulting massive tuition fee increases are
shutting students from low-income and even middle-income families
out of the system. We would argue that if earning potential is a
factor, that can be addressed through a progressive taxation
system once a student has been able to access post-secondary
education and complete their degree. We've also seen studies
coming out of the universities of Guelph and Waterloo, in
addition to Statistics Canada and the University of Western
Ontario study.
What concerns us is that
deregulation of tuition fees has been slowly progressing. We
started first with international students; then deregulated
tuition fees were introduced for dentistry students. Now it's
professional and high-demand programs. We've already seen that
some university administrators, to deal with funding cutbacks by
the provincial government, are now advocating for undergraduate
tuition fee deregulation. I'm specifically referring to Queen's
University as an example. We're quite concerned that
deregulation, when it's been implemented, has not stopped simply
in those programs, and that it will continue to be implemented
across the system. We need to stop deregulation and actually roll
back those tuition fees.
Mrs
McLeod: You raise the millennium scholarship issue in
your brief. Do you have any idea how many millions of dollars the
Ontario government has saved by simply taking the federal dollars
and using them to offset their loan forgiveness costs?
Ms George:
It's hundreds of thousands of dollars currently. But of course
because the process hasn't been transparent and an audit has not
been done, despite our encouragement to both the province and the
millennium scholarship foundation to do an audit, those numbers
aren't concrete or available yet.
The
Vice-Chair: We'll move on to the third party.
Mr
Christopherson: Thank you, Erin, for your presentation.
I think I owe you an apology. During the debate on Bill 147, I
was reading public comments that you made into the record in
favour of opposition-"in favour of opposition"; there's a
roundabout way-but supporting the opposition we were putting
forward on that bill. I kept referring to you as "he," so I
apologize. I'm pretty sure I did that.
I want to turn to what
you've said on page 3, and I want to quote from it. "In addition,
Ontario's colleges and universities must now rely heavily on
corporate largesse in order to remain viable. However, such
reliance comes at a price. In return for funding, corporations
are demanding a greater say in the day-to-day business of our
colleges and universities and dictating policy decisions
regarding curriculum. With alarming frequency, we are seeing
pockets of our public institutions being privatized and funds
going toward financing what amount to job training programs for
the private sector." Very powerful statements.
I'll tell you why I'm
posing this. There are a lot of people who don't see a problem
with the idea that universities and colleges would find alternate
sources of income. If that happens to be big business, fine. Any
money they can get out of them they'll figure is to the public
good, seeing it as some sort of positive contribution to society.
However, you're raising an alarm bell, saying, "Hey, folks,
what's really going on here is that they're getting to dictate
what kinds of courses are being taught, thereby providing private
customized training-best in the world-and the public is paying
the hook and they're getting it for just a minor amount." Can you
give us one or two concrete examples of where that's happening? I
think that would sort of shake people if they knew that.
1550
Ms George:
Sure. One example is at the University of Toronto. Nancy Olivieri
was doing research on a drug for a pharmaceutical company. I
believe it was Apotex. She found in the course of her research
that the drug was actually detrimental to the health of her
patients and came out publicly against the contract-
Mr
Christopherson: Yes, I recall.
Ms George:
-against the terms of the research she was conducting, to bring
the public's attention to this dangerous drug. At the same time, the
University of Toronto was soliciting a large financial donation
from that pharmaceutical company to the university for endowments
etc. That is still underway. The university administration and
the pharmaceutical company engaged in quite a horrific smear
campaign of that researcher. It's a clear case of how when
private sector involvement in post-secondary education, and
particularly research, is happening, it's being done in the name
of profit and not in the name of the public good.
I'll give you another
example from my own experience as a student at Ryerson
Polytechnic University. I'm a journalism student there and my
journalism studies have been done in the Rogers Communications
Centre. My lab is the Sun Media newsroom. If I want to compete
for scholarships, I have to fill criteria set out by CFRB Radio.
My internships are all at corporate newspapers or magazines. I
think that's a key example of how it's a training ground not for
critical journalists, but actually a training ground for a
corporate journalist to go into mainstream media. That's been my
own educational experience.
The
Vice-Chair: Thank you very much. On behalf of the
committee, thank you for your presentation. We appreciated your
coming forward.
CAMPAIGN AGAINST CHILD POVERTY
The
Vice-Chair: Our next delegation is Campaign Against
Child Poverty, if that delegation would come forward at this
time. On behalf of the committee, welcome to the standing
committee on finance and economic affairs. We look forward to
your presentation. For the sake of the record, if you'd state
your names at the beginning. You have a half-hour to be used
partly for presentation, and what's left over will be divided
evenly among the three caucuses.
Mr Gerald
Vandezande: My name is Gerald Vandezande. I'm the
volunteer spokesperson for the Campaign Against Child Poverty.
With me is Mr John Buckingham, who is connected with the St Felix
Centre, a long-time street ministry in Toronto.
For your information, as
the cover sheet on the presentation shows, the Campaign Against
Child Poverty is a coalition of faith communities, public
interest and child advocacy groups, family service organizations
and others who are concerned about the increasing numbers of poor
and inadequately cared for children in Canada. For the record,
I'd like to mention some of the member organizations, which
include the Anglican Diocese of Toronto, B'nai Brith Canada,
Canadian Association of Food Banks, Catholic Children's Aid
Society of Toronto, Citizens for Public Justice, Family Service
Association of Toronto, Jewish Family and Child Service, MAZON
Canada, Campaign 2000, from whom you heard earlier today, United
Church of Canada, United Way of Greater Toronto, and many more
organizations that have increasingly become aware of the urgent
need to do something substantial about the worsening child and
family poverty in this province.
I will not burden you with
reciting more statistics. I follow the hearings a bit, also here
this afternoon, and I'm sure you've heard enough statistics by
now that clearly spell out the crisis situation that is
developing in our province, and it's a crisis that is developing
throughout Canada. I want to speak to that major concern that
confronts us in the hope that the government, in its next budget
and in the policies it will be developing, will take the bold,
courageous steps needed now in order to end child poverty this
year.
In recent speeches and
interviews with the media, Premier Harris has repeatedly said
that Ontario has a booming economy, and in connection with child
poverty has made the very valid point that everything must be
done, unitedly, in order to make sure child poverty is
eliminated. I will not now read into the record all his comments,
but we take the Premier at his word that the Premier and his
cabinet colleagues, as well as the caucus, want to demonstrate in
the next budget that they're very serious about the threat of
child and family poverty in this province and that they will do
whatever they can.
I want to make a couple of
comments in the context of the values, the vision, out of which
the Campaign Against Child Poverty, on a non-partisan basis, is
dealing with these questions.
We began a few years ago
pooling all the resources and information we could lay our hands
on in order to put together a comprehensive position as to what
could be done in this province and throughout Canada, and in that
context began with running two full pages in the Globe and Mail,
a major statement addressed to our governments that they do their
utmost to ensure that immediate action be taken to eliminate
child and family poverty.
We followed that up
recently with an open letter to the Prime Minister of January 19
in which we spelled out the five conditions we think the
government must come to grips with. We're pleased that in the
throne speech on January 30, the federal government made some
very clear commitments that something must be done quickly with
respect to the worsening crisis threatening children. In his
reply to the throne speech, the Prime Minister made further
commitments. I state those to you because for us in the Campaign
Against Child Poverty it has constantly been a question of
conscience. As people, as a province, as a government, as a
Premier, as faith communities, as community organizations, what
does our conscience dictate we do at this crucial moment in
Canadian history, and what will the Premier, the cabinet, the
caucus, do now that they have the power to do something
drastic?
I'm sure all of you are
aware of the budget surplus the government ran of billions of
dollars, some of which were spent on tax cuts that mostly went to
the wealthier people in our province and none of which went to
restoring the welfare payments which were arbitrarily cut by the
government when it got into power after the first election. We
deeply deplore and severely regret that arbitrary decision to cut
the income of the most vulnerable people in our society, and we make an appeal to
you again today on behalf of all the faith communities, community
organizations and others who, with us, want to do whatever can be
done to make sure no one in this province lives below the poverty
line and that particularly the plight of vulnerable children, who
are voiceless citizens, be taken into much more active
consideration when the next budget is prepared.
In that connection, I want
to refer for a moment to the major agreement that was signed by
all the provincial Premiers and territorial leaders on September
11 in connection with the early childhood development initiative.
That was signed by all the provinces, including Ontario. The
question I want to leave with this committee, and I'll come back
to it again at the end if all goes well, is that no one knows how
Ontario plans to spend the estimated $114 million it will receive
from the federal government under the early childhood development
initiative. Some believe the funds may be added to particular
initiatives the government is thinking about, but nothing has
been made public. We are here today to plead with this committee
to ask the Minister of Finance and the Minister of Community and
Social Services, as well as the Premier and the other members of
the cabinet, that they make it very clear how they will spend the
$114 million that has been allocated to the province of Ontario
to deal with the threatening crisis of child poverty. I've raised
that question because we're also asking the federal government to
do much more than it has done in the past and we're asking the
other provincial and territorial governments to do what their
conscience should require them to do.
1600
In that connection, I want
to draw to your attention again, as I said at the beginning, that
for us this issue is a non-partisan issue. Poverty is not an
issue that is really "owned" by political parties for their
political partisan purposes but it is a human issue. It involves
human rights, civil liberties, fundamental needs of children and
their desperate families. We make an appeal to you to register
that message very clearly and very pointedly with the Premier,
with the cabinet and with the government, and when you write your
report for the Legislature and make it public, that that central
question as to which conscience, which values, which vision and
which morality shapes your approach to child and family poverty
be clearly outlined, as well as the question I asked a moment
ago: how will the government spend the $114 million it is getting
from the federal government, which helps to stimulate and
increase its revenue in order to deal with the tragedy of child
poverty?
I've raised that question
in the context of a statement I want to read to you. "I agree
with Premier Mike Harris that, `The crisis that took place in
Walkerton was the one that was most tragic and impacted,
certainly, not just the government but ... the whole province in
a very shocking way.'
"Another crisis that is
`shocking' and `tragic' is the government's hard-hearted refusal
to restore social assistance for families to house and feed their
children."
I read those couple of
paragraphs, which I took from the Toronto Star where I published
them as part of an appeal to the Premier, to you and to your
colleagues to examine what our collective conscience dictates us
to do at this historic juncture in Canadian history. We plead
that you do whatever you possibly can by way of compassionate
policies and by way of generous allocation of funds so that
people who are in desperate situations have a real future ahead
of them.
The government has been in
a surplus position in terms of its expenditures. We plead with
you to put a moratorium on tax cuts, to increase the social
assistance payments, to substantially increase the support that
children and vulnerable families need in order to live with
dignity, and that their well-being and their future becomes the
bottom line in terms of the values that you seek not only to use
in speeches and in reports but also to practise in your budget
allocations.
I will leave it at this for
now. I'm speaking on behalf of all the faith communities in
Ontario. The ad that you may have seen on January 19 included
virtually every faith community in this province, every community
organization in this province, every organization concerned with
the plight of children, organizations that put their own
resources, their own money at risk because they believe it is
their conscientious duty to do whatever they can. But we plead
with the government to do its share.
I'll close with one quote
from the Premier, if I can find it quickly. He said, I think it
was on October 5, "This cause of child and family poverty is so
large and so important that it demands a united approach and a
maximum effort from all of us." That's the Premier speaking. We
totally agree and we say, government, do your share, do your
duty. Exercise your governmental responsibility to see to it that
justice is done and that no children fall between the cracks,
that no families are being discriminated against, that we end the
politics of discrimination and the economics of exclusion and
practise the values of human dignity and well-being that have
been at the heart of our province and of our nation which we love
so much.
The Chair:
Thank you very much. We have approximately five minutes per
caucus. I'll start with the official opposition.
Mrs
McLeod: I'll begin and then turn it over to my
colleague.
Mr
Vandezande: Would you speak up slightly. I'm a bit
deaf.
Mrs
McLeod: I certainly will. I'm aware, at least I believe
that it's the case, that over the last couple of years as we've
enjoyed an economic boom, to quote the Premier again, as we look
across the country it's only in Ontario and I believe
Newfoundland where the numbers of families living in poverty have
increased, as opposed to showing some at least marginal decrease.
Is that true? Is that the right information?
Mr
Vandezande: The record that you got and the materials
you got from the Campaign Against Child Poverty, which is a
member of our coalition which appeared here earlier, clearly indicate that trend. You
are correct-and I'm a cost accountant by background-that given
the way the economy has grown, given the amount of revenue the
government has collected, given the cuts that have been made in
welfare payments and in community support programs, vulnerable
children and families are at their worst in this province.
Mrs
McLeod: It's interesting that cost accountancy is your
background, because although child poverty should not be a
partisan political issue, sometimes the responses to it are
ideological. It was said earlier around the table that one of the
reasons for tax cuts is that there will be an improvement
eventually of government's ability to meet the needs of people
for social programs. I guess my question to you is, do you see
any way in which the tax cuts we've already had in Ontario, not
to mention the tax cuts that are to come, have actually served to
benefit children who are in poverty, working families or others
who are living in poverty?
Mr
Vandezande: The tax cuts and their impact on vulnerable
families and poor children-the document filed by Campaign 2000
clearly shows-I think it's on page 6-that the tax savings have
gone, by and large, to people in the high-income brackets. The
government has not gone out of its way to make sure that any
surplus money it has received be designated to help eliminate
poverty in this province. In fact, if you take inflation into
account, then the poverty rates have worsened since this
government got into power.
Our appeal is that indeed
it ought not to be a partisan issue and that the government ask
itself, particularly the Premier, what in the light of our
conscience, of our values that we cherish as a province ought we
to be doing in the next budget to make sure that we correct the
serious mistakes that have been made and make sure that all
people are treated equitably? That may mean, probably must mean,
that no more tax cuts go to people who are well off, who are
rich, who get much, much more than anybody on modest incomes, and
that the big tax cuts that abnormally go to the wealthy be
redirected and go in support of increasing the social assistance
programs, to community services and the social assistance
payments to people who desperately need it who now live on the
streets or increasingly stay over night in shelters.
I don't know how the
Premier, how the cabinet, how you as people deal with it in your
conscience. But our conscience dictates to us that we make this
pitch to you, this appeal, that we end the situation once and for
all and that there be an all-party effort in the Legislature to
make sure that the budget is not a partisan issue but is a
confirmation that this province is determined to treat all of its
citizens, especially the children, fairly and equitably.
The Chair:
You still have a minute.
1610
Mr
Kwinter: I just wanted to address the question as to
what this province is going to do with the money it gets from the
federal government. All you have to do is take a look at the
national child benefit supplement, where the provinces have been
urging the federal government to participate in alleviating this
problem. The federal government comes up with a program, sends it
to the province and, instead of doing what it's supposed to do,
and that is to supplement the income of these people who require
the child benefit, they've deducted it from what they get. As a
result, if anything, it's alleviated their responsibility and has
taken money directly from these people that was intended by the
federal government.
Mr
Vandezande: I understand what you're saying. I think
that position is unacceptable. It's immoral, and I don't use that
term-you may not steal from the poor in order to enhance the
powerful position of the rich and the wealthy. I think this
government owes it to its own conscience and to the future of
this province that the $114 million be used for those for whom it
was designated.
The Premier was on the
China mission with the Prime Minister and they seemed to be
getting along. My hope is that the provincial Premiers and the
territorial leaders, united, say, "We're going to spend the money
the feds are making available for the purposes for which it was
intended, and we're no longer going to discriminate against the
most poverty-stricken people in our society." I hope that in the
next budget, with a new finance minister and, hopefully, a
Premier with a renewed conscientious dedication to the
elimination of poverty, we'll certainly make sure that the money
is reserved for that for which it was intended: to eliminate
poverty and to make sure that there is no homelessness in this
province any longer.
The Chair:
With that, I have to go to Mr Christopherson.
Mr
Christopherson: On your last point, hope springs
eternal, but don't hold your breath. There aren't any real-
Mr
Vandezande: Just on that, hope is a conviction that we
all share, I hope, that needy people should not be ignored,
should not be excluded from meaningful participation in society.
Hope is that you have the confidence that justice can be done,
will be done, ought to be done and that government ought to give
that kind of leadership. I think to the degree that the
opposition parties, including your own, make this an issue in the
House-and maybe we ought to have a repeat of what my member of
the Legislature, Alvin Curling, did. That was a sit-in.
Mr
Christopherson: They changed the rules. We can't do that
any more. They changed the rules.
Mr
Vandezande: Well, you do it anyway. What we need is a
public demonstration that our elected representatives share the
solidarity that they often express in a visible way with the
people who are now homeless, who are poverty-stricken, and find
an effective way of demonstrating that. If that means a public
protest of some kind in the Legislature or in front of the
Legislature, together with all who share the values that the
Premier himself has spoken about-either he says what he believes
and does what he believes and shows it in his budget or he
withdraws and apologizes that he has been misleading the
province.
I would like to believe that the Premier will do
the right thing. It just passed through my mind that when he was
installed or ordained, or whatever you want to call it, as the
Premier of this province, his Anglican rector-and I don't have
the prayer with me-recited a beautiful prayer that the Premier
and the government do justice, act wisely and come out in favour
of the needy. I think that needs to be translated into action
that demonstrates that the Premier believed what he said, that he
will do what he promised and that he will instruct the finance
minister to spend $114 million, and the money in excess of $1
billion that is available, if they really want to change the face
of poverty in this province.
Mr
Christopherson: I would go further than that. If they
really cared, they would have at the very least recognized that
it's totally unconscionable to take away 22% of the income of the
poorest of the poor and do something about it. They haven't done
that. There's affordable housing-they haven't done that. In terms
of us protesting, we did that and there were a number of times
since then when we wanted to do the same thing, but they've
changed the rules of the House.
Let me get in my question
and then I'll give you carte blanche to go. I do want to
emphasize, though, that Tony Martin, our MPP for Sault Ste Marie,
made a very strong statement in that regard as he set aside the
robes of being a Deputy Speaker of the House-
Mr
Vandezande: Personally, I thought that was a tremendous
act of conscience. Maybe all the members of the Legislature may
have to stand up and say, "Our conscience dictates that we stand
here and, united, make it clear that we no longer accept the
intolerance that is being demonstrated vis-à-vis the most
vulnerable."
I think members within the
Conservative caucus-and I've talked to them-begin to feel that
way. They know they're not engaged in a Common Sense Revolution
that touches the lives of ordinary people in a wholesome way. A
number of them are ready to quit and resign, and they wait for
the government to do something in the next budget. I hope they
follow the dictates of their conscience and challenge the
Premier, the new finance minister and everybody else within the
party to deliver what they've been saying for so long but have
not done.
Mr
Christopherson: I won't name names, but I could name
some of the members of the Tory backbenchers in particular who
feel that way and struggle. Unfortunately, there is a majority
who somehow manage to get past it and find other ways of it not
bothering them. I lived through it, I was here, I refer to it in
speeches, I talk about it now, and I have to tell you, sir, as I
mentioned to Lyn, I find it surreal that here in Ontario one of
the first things a new government did was take away 22% of the
income of the poorest of the poor, something they wouldn't dare
do anywhere else. What is also a sad commentary is that we, the
people of Ontario, let it happen with barely a peep.
Mr
Vandezande: One can argue about that-and you and I can
have coffee-whether it was barely a peep. My concern is that
today we resolve to make a new start. This is the end of your
committee hearings. You have to write a report. You have to
present that to the Legislature. You have to think through what
we, deep down in our hearts, want to say our conscience dictates
with respect to the homeless people in the streets of Toronto and
other cities, with respect to poverty-stricken families. What are
we going to tell our respective constituents, our faith
communities, our community organizations that are desperately
trying to come to grips with all the crises they daily confront?
Are we going to make it absolutely clear that we're going to make
a new start in life?
There is hope for this
government, as there is hope for Ontario, to the degree that
we're prepared to adopt the values of justice and charity and
love and concern and solidarity and equity in our fiscal policies
so that it becomes evident that this government has a right to
govern. But if you abandon the very values this province has
historically stood for, if you ignore the people who are
suffering deeply daily, then you lose your mandate to govern. You
may have it yet for a little while, and my hope is that you will
use the balance of your mandate in such a way that the people of
this province will say, "We respect the government for having the
guts to change its mind, to have a change of heart and to follow
the dictates of the conscience that is being informed by a faith
commitment, by a value commitment, by a vision that speaks of an
Ontario in which we work together for the common good based on
public justice for all." If we don't, we're in deep trouble.
The Chair:
With that, I'll go to the government side.
Mrs
Molinari: Thank you very much for your very passionate
presentation. It's evident that your work within the organization
comes from the heart and it's something you feel very strongly
about.
You ended your initial
presentation, before the questions began, with a quote from the
Premier. Certainly, the Premier and this government are committed
to-in fact, we've introduced a number of new initiatives that
support low-income families and children.
1620
Ontario's Promise
challenges all of the organizations and everyone to come together
to support those who are in need. I don't know if you're familiar
with some of the initiatives: the early years challenge fund; the
Ontario Breakfast for Learning program; Healthy Babies, Healthy
Children; Better Beginnings, Better Futures; and there are a
number of others.
I want to comment on some
of the-
Mr
Vandezande: Just on those two programs that you've
mentioned, they are important initiatives and they make a
valuable contribution, but to a large degree they will be
dependent for their success on the amount of money that
non-government groupings in our society make available.
The question I asked at the
beginning is, what will the government do with the $114 million
it will receive from the federal government that is designated by
an intergovernmental agreement to help children and families
caught in desperate situations? That's the question we're
asking; that's the
question we would like to have an answer to. With all the praise
I want to give to whatever good initiatives the government has
taken, it must address and tell the people of Ontario what it
will do with this government transfer from Ottawa. Will it be
used for those whom it was meant to help?
Mrs
Molinari: The budget will indicate specifically what
that will be used for.
Mr
Vandezande: But why wait until May? Why not say
tomorrow, "We're going to make a public pledge that the $114
million pledged by Ottawa that we agreed to in the interim
agreement in September 2000 will be set aside, without
reservation, for the very purpose it was intended"? That would
give people a clear idea that this government wants to be very
conscientious about the deals it signed in Ottawa, with Ottawa
and the other provincial governments, and say, "We are indeed
determined to do what we promised."
Mrs
Molinari: I thank you for your recommendations, and
obviously that's a recommendation you've made here that will be
passed on.
Mr
Vandezande: It was a recommendation that was signed by
the Premier. He accepted it. He signed the deal on September 11.
It happened to be my dad's birthday; that's why I remember it
well. The agreement, what Ontario committed itself to, is very
clear. It can't dodge its responsibilities by not telling the
people where the money is going to be spent. Don't wait until the
budget. Everyone knows. Everyone is waiting for a clear
answer.
Mrs
Molinari: If that's the commitment the Premier made,
then I'm sure it will be a commitment that will-
Mr
Vandezande: I think this committee should remind the
Premier that he ought to-
Mrs
Molinari: And that's what this committee is for.
Before I lose all of my
time, I just want to make sure I get in some of the other points
I want to make, especially the points you've raised around social
assistance and that area. We have a conscience and we believe
that the best way to help people is to provide them with a
climate where they would be able to help themselves and to give
them the renewed hope to be able to do that.
I'm also a very religious
person and I spend time reading the Bible. There is a quote that
says, "You give them fish and they will eat for a day; you teach
them how to fish and they will eat for many days." That is
something I think is important to keep in mind, that you don't do
things on a short-term basis but you allow people to regain hope
in order for them to continue and to be able to have the
self-assurance and self-discipline and their own esteem to go on
further.
Social assistance is a
program that is there for people who are in need. It's certainly
not-
Mr
Vandezande: But we now have people who don't have fish,
who don't have bread, who don't have a home, who don't have what
they need in order to live. The statistics are there. Indeed,
that Bible passage is very relevant. Teach them how to fish, but
teaching them how to fish includes giving them the kind of
adequate income, the kind of child care, the kind of jobs, the
kind of opportunities that will enable them to take care of their
families. If you don't give them the kind of bread, the kind of
food, the kind of home, the kind of support, the kind of health
care, the kind of community care they need, then we are violating
the very passage you quote and we're not following what Jesus
said, "Do justice, show mercy, practise faithfulness, demonstrate
love, show your solidarity."
Our appeal, as faith
communities-on a non-partisan basis-is, go out of your way to
demonstrate your conscience and translate it into a commitment
that helps take people off the street and makes sure that
children are adequately fed, that families are not left out in
the cold-we need more and more out-of-the-cold programs-so they
can experience the warmth of a justice-loving government and
Legislature that are determined to see to it that all people can
live freely with respect and with dignity and experience the
well-being they're entitled to as Canadian citizens.
The Chair:
With that, we've run out of time. On behalf of the committee,
thank you very much for your presentation this afternoon.
Mr
Vandezande: Thank you. I'll be glad to engage in further
discussion. This is serious and you laugh about it.
Mr Galt:
No, I'm not laughing. It's just your enthusiasm. I wasn't being
nasty.
The Chair:
I'm sorry. I must go on to the next presenter, because we do have
a schedule that we have to meet.
ONTARIO HORSE RACING INDUSTRY ASSOCIATION
The Chair:
Our next presentation is from the Ontario Horse Racing Industry
Association. I would ask the presenter to come forward and state
your name for the record. On behalf of the committee, welcome.
You have 30 minutes for your presentation this afternoon.
Ms Jane
Holmes: Thank you, Mr Chair and committee members. My
name is Jane Holmes and I'm the executive director of the Ontario
Horse Racing Industry Association. I see a number of faces that
are very familiar around the table. I want to thank you on behalf
of my industry for allowing me to make this presentation
today.
OHRIA is an umbrella
organization that represents all major segments of the horse
racing industry: the 18 licensed racetracks across the province,
the owners and trainers, the horsemen, who are the grooms, the
jockeys. I think it's kind of fitting that I'm following the last
presenter, in that many of the people employed in our industry
are considered marginally employable. Without work in the horse
racing industry, they too could be living on the social
assistance program of the government. We represent all the breeds
in the industry: the thoroughbreds, the standardbreds and the
quarter horse industry.
OHRIA's mandate is to seek
to further promote the horse racing industry as a vital part of
Ontario's lifestyle, heritage and agricultural economy. You may
be aware that the
horse racing industry employs over 45,000 people, and that's
equivalent to 27,000 full-time jobs. However, many of the jobs in
our industry are part-time. The industry spends-and this is just
the horsemen alone-over $1 billion a year, and that makes it the
third-largest agricultural sector in the province. We are also a
very important part of the gaming sector and we compete with
government-operated lotteries and casinos and
government-sanctioned casinos and charitable gaming.
Horse racing is a vital
component of Ontario's economy, particularly in the rural area.
The industry, through OHRIA, has been advocating a comprehensive
provincial gaming strategy since 1995. This gaming strategy is
still not in place. It must identify the net economic impact of
introducing new gaming products and identify the
interrelationships between all the various forms of gaming in the
province. This would include a thorough consideration and
quantitative estimation of potential cannibalization,
substitution effects and the complementarities among the various
components of gaming. I can say this because as the new forms of
gaming were introduced into the province, the horse racing
industry felt the impact. As such, the governments of the day
have introduced various programs to try to assist the horse
racing industry.
We have learned that the
Ontario Lottery and Gaming Corp conducted a market assessment of
a limited subset of the gaming industry. We believe it's
necessary to look at the gaming industry as a whole, because a
partial analysis results in a truncated view of the overall
industry. In the aforementioned study, the only considerations
were commercial casinos, charity casinos and the slots at
racetracks. Parimutuel wagering and other forms of charitable
gaming, such as bingos, were not considered in this study. Yet
both our industry and the charitable gaming industry are highly
regulated by the government in their gaming expansion by either
the Ontario Racing Commission or the Alcohol and Gaming Control
Commission. This creates an unlevel playing field between private
investors versus government-operated gaming when it comes to
expansion.
Again, if there is a
provincial gaming strategy, it's important to address not just
the direct gaming dollars that go to the government, because that
presents an extremely limited view of the impact of any
particular gaming activity. In our view, a provincial gaming
strategy should be based on a full economic impact assessment
which includes direct and indirect employment income and all
forms of government revenues, not just direct gaming revenues. In
our industry, the impact consideration we are advocating should
reflect the impact of our industry on rural communities and the
agricultural sector. Only considering the dollars returned to the
government in terms of direct gaming revenues is an unbalanced
perspective.
1630
Therefore, we are here to
request that until a comprehensive provincial gaming strategy is
completed, there be no further expansion of government-operated
gaming venues and new gaming activities in the province. We are
particularly concerned about another charity casino in downtown
Toronto because of the negative impacts that commercial and
charity casinos have had on our sport. This is why we applaud the
current moratorium on gaming, which will last until 2002, and we
wish that would continue further into the future until there is a
comprehensive gaming strategy in place.
Now for the good news. Our
industry is being rejuvenated by the government's initiative to
reduce parimutuel taxes and the launch of slot operations at
racetracks. However, any expansion of other gaming activities in
our market area would be inconsistent with these initiatives and
work to undermine the positive impacts that have been felt.
Between 1992 and 1998, our
industry suffered extensively from a decline in wagering and
attendance. In no small way was this exacerbated by the rise of
commercial casinos and lotteries. Wagering remained almost
unchanged in nominal terms between 1992 and 1998. In real terms,
if we adjusted for inflation, standardbred wagering dropped by
14.8% over the same period. While thoroughbred wagering didn't
drop the same amount, it did decline by 2.6%.
Several other key variables
in our core business which contracted over the same period
include the number of participants in the industry. The field
size, of course, diminished, the number of standardbred races
were reduced, and the number of thoroughbred races stagnated.
But our industry is being
rejuvenated and we are a very good-news story. There's incredible
optimism in the industry right now that has never existed before.
Fresh money from slots and the tax breaks have moved racetracks
from a negative cash flow to a small positive cash flow. We
expect that the positive impacts of the tax reduction will be
further improved by the end of the industry's five-year breeding
lifecycle. What I mean by that is that within this industry, if
someone is going to make an investment in a brood mare, for
example, it will take three years before they will realize their
return on that investment, by the time they are able to sell the
horse, because it's a year of gestation, a year before it can be
sold as a yearling, and then hopefully in the second year the
horse will be able to race at the track.
Parimutuel wagering
increased by 5% in 1999 over 1998 and by a further 4.34% in 2000
over 1999. Those are not adjusted for inflation. We have become
the envy of every other horse racing jurisdiction worldwide,
particularly in other provinces, which are often calling OHRIA
asking for help to find out how we developed the partnership with
the government so that they could get advice on revitalizing
their sagging horse racing industry.
The Ontario government
responded to the industry's request to give us the tools and
resources to reinvest not only in our industry but also in the
province. Since OHRIA took over the administration of the horse
improvement program from the Ontario Racing Commission, we have
been able to double the program's base funding. This revenue is
being reinvested into the horse race and breed programs, such as the famous
Ontario Sire Stakes, which is now identified as the top stakes
program in all of North America. This has laid the groundwork for
many domestic and foreign investors to develop new businesses in
rural Ontario. In fact, an interesting note is that there was an
Australian breeding operation looking to set up its base of
operation for North America, and they have selected Ontario and
will be operational this year. I think that's a big win for
Ontario, that we're able to draw international investment into
the province for this.
The new revenues have
induced the racetracks to embark on major investment programs,
sometimes in excess of the new revenues that are being received,
to expand and upgrade the facilities and services at our tracks.
It is our hope that this investment program will be sustained and
will result in a larger revenue base for both the racing industry
and the government.
It is our considered
opinion that the revenue growth potential for all partners is not
being optimized and could be better realized with improved
marketing of racetracks as gaming entertainment destination
centres. There are positive opportunities to showcase the venues
as tourist destinations or growth poles. This will also result in
expanding the economic impact of the government's initiatives
into the rural areas.
Now we come to the good
news. Since we got the parimutuel tax break and the slots, the
tracks in Ontario have an average employment of 4,856 people.
Collectively, the tracks have spent $56.2 million on track
improvements and upgrades during the past five years and over
$205 million on developing the infrastructure for housing the
slots. That's all private investments from people involved in the
industry. These capital expenditures have generated substantial
temporary employment, incomes and tax revenues at the tracks and
in the economy at large. The capital expenditures on upgrading
and rehabilitating the tracks have contributed $67.1 million in
income, a total of 939 person-years of employment, and $24.8
million in taxes. In addition, we have the capital expenditures
on the tracks for creating the facilities to house the slot
machines, and that's contributed $247.7 million in income, a
total of 3,466 person-years of employment, and $91.6 million in
taxes. The combined total of this is over $315 million in income,
almost 4,500 person-years in employment, and a total tax revenue
of $116.4 million to all three levels of government.
We had advised the
government that if we were given the tools, we would reinvest in
Ontario and our core business. I believe the figures I've just
identified have demonstrated that the horse racing industry has
lived up to its commitment.
It also gives me great
pleasure to report that the horse racing industry has taken a
very proactive approach in promoting responsible gaming. We have
partnered with the Canadian Foundation on Compulsive Gambling in
outreach and public awareness programs. We have also recognized
our leadership role in rural Ontario. We recently made a major
donation to the Ontario 4-H Foundation to help the leadership of
young people in rural Ontario.
I want to thank the
committee for their time. I urge the government to move forward
on a comprehensive provincial gaming strategy so that the jobs
that have been created by the private sector are maintained and
not put in jeopardy by expanding the government-operated market
without first understanding the implications of doing so.
The Chair:
Thank you very much. We have five minutes per caucus, and I'll
start with Mr Christopherson.
Mr
Christopherson: I thank you for your positive report
today, as a member from a city that now instantly has a
racetrack. I'm from Hamilton. Flamborough is now a part of
Hamilton and we now have a racetrack, us Hamiltonians.
Ms Holmes:
You do, the fabulous Flamboro Downs.
Mr
Christopherson: Absolutely, an important part of our
community.
You mentioned on page 2,
and I'm quoting directly from your report, "Ontario has become
the envy of other horse racing jurisdictions worldwide, but
particularly in other provinces who have called upon us to
provide advice on revitalizing their sagging horse racing
industry."
Can you just expand on that
a little bit and give me a better sense of what's going on in
other provinces?
Ms Holmes:
Absolutely. One of the things you're probably all aware of is
that this industry is historically known for being fractious and
having infighting take place. Under the umbrella of OHRIA we have
brought all the parties of the industry together to speak as one
voice. We resolve the issues internally and we're able to
identify and plan for our future so that we were able to bring
forward to the government the types of tools we needed to
reinvest in and rejuvenate the industry.
I personally have gone out
to the Maritimes to help them in setting up an OHRIA. In fact, I
just came back from Alberta this past weekend, talking to them
about how the industry needs to develop a plan for their
future.
Mr
Christopherson: Are they structured similarly in the
other provinces? I don't know a lot about the racetrack
business.
Ms Holmes:
They are structured somewhat similarly. I think the difference is
that in Ontario we see the government as our partners. You are
our competitors, but you're also our partners. Unfortunately,
that hasn't always been the case in some of the other
jurisdictions. The perception that they're a dying industry has
been taken internally, instead of saying, "We can get out of this
circle."
Horse racing is regulated
federally by the Canadian Parimutuel Agency, and then all the
provinces have a provincial regulator as well.
1640
Mr Arnott:
Thank you very much. I appreciate the information you've provided
to us. It's interesting to see how your industry has turned round
since we came into office and certain changes were made to assist
you.
But like you, I'm concerned about gambling
addiction. I know you made reference to it toward the end of your
brief. I was wondering if you could give us a little more
information about the kinds of programs that you are supporting
to assist what you'd call promoting responsible gaming, saying
that there are public awareness programs and outreach programs.
Could you tell us a little bit more about what those entail?
Ms Holmes:
Sure. One of the things we did is that we copied the casinos in
having a self-exclusion program, so if people have identified
themselves as having a problem, they could request to be banned
from not only our racetracks but our teletheatres. We have a bit
more difficult situation in enforcing it because we don't have
security cameras around all of our facilities to the same degree
that they do at the casinos or the slot operations. But we've
developed a poster campaign called Know When to Take the Reins.
For information on responsible gambling, they phone the Canadian
foundation.
We were also the first
gaming industry in the province to actively promote the
provincial problem gambling helpline. In fact, I guess a bit to
our detriment, it looked like a lot of the people who were
phoning had problems with parimutuel as the vast majority. But it
was just the success of our promotion of the line that resulted
in those types of numbers, because in other statistical studies,
it's shown that in terms of gambling, parimutuel is statistically
insignificant.
We have pamphlets that are
made available. We're currently putting together a video for
training all the staff. The problem we have is that we're so
dispersed throughout the province, particularly with the
teletheatres, it was difficult to bring people into one location
to be able to train them. So we're looking at videos. We're also
talking to the foundation about putting together a video that
would be shown on the TV screens that would be directed directly
at the customers, so if they do have a problem, they would be
able to get the information there and know how to deal with
it.
I personally represent the
industry on the Ontario partners for responsible gambling, which
is the Ministry of Health and all the various gaming venues.
Mr Arnott:
The government is setting aside a certain percentage of the
revenues from gaming. Is it 2% of the slot revenues?
Ms Holmes:
Two per cent of the slot revenues go toward problem gambling
education and treatment programs.
Mr Arnott:
Research as well?
Ms Holmes:
Yes, that's correct.
Mr Arnott:
Again, thank you very much for your presentation.
Mr
Kwinter: Hi, Jane. I'm just delighted to have you here
and to have your presentation. Members may not know, but I was
the minister responsible for implementing the racetrack
assistance program in 1985. That was at a time when the horse
racing industry was in real trouble. The reason they were in real
trouble, of course, is because at one time they were the only
game in town. If you wanted to gamble, you could only do it at a
parimutuel racetrack. Then with the advent of bingos and
lotteries and casinos, it really had an impact on the racing
industry.
First of all, the biggest
problem is that there were no young people coming to the tracks.
It was all people who had been used to horse racing, and they
were the ones who were there. The racing industry was in deep
trouble. They were having, as Jane has already pointed out,
trouble attracting purses, trouble attracting horses.
This industry has
far-reaching benefits to Ontario, without the gambling. I'm
talking about, and it's already been alluded to, the fact that
many of the people who work in the backstretch are virtually
unemployable other than in this industry. There's a huge spinoff
for the agricultural sector in the growing of hay, in the raising
of horses. If you fly over Ontario in a small plane, you see all
these tracks. It's too bad our colleague Mr O'Toole isn't here,
because on our trip he was telling me that he had no idea of the
extent of tracks and horse-breeding in his particular riding
until someone took him on a tour. So it's a very important
industry. In the agricultural sector it's number three. It's very
important. I don't have to tell Dr Galt, who's a veterinarian. He
would certainly know about that as well.
The point that I'm trying
to make-and I'm not asking a question because I agree with
everything that you've said-is that what is critical, and the
reason the government made the decision to put the slots into the
racetracks, is that it solves lots of problems for them. Number
one, in any community, particularly in Toronto, there is a large
number of people who are opposed to casinos. By putting it out at
the track, which already has a gambling component, it takes it
away from, say, putting it in downtown Toronto, where people may
object, and it gives it to an industry that's used to dealing
with gambling. It has the culture, the infrastructure to deal
with that. So that is really important.
I have seen, and I
encourage any of you to go out there to see it, the dramatic
difference in what has happened as a result of the racing
industry being allowed to bring in slot machines. Not only does
it provide a gambling venue for people, but it has immeasurably
helped the industry. Suddenly the purses are bigger, the number
of races is greater. It's a win-win for everybody.
The problem, and this is a
point that I'm sure Jane has been trying to make about everything
else, is that now that we're on a roll, you can't kill the goose
that lays the golden egg by providing competition literally from
the same people who regulate it. The government would be the
competitor if they put in these casinos, and until there's a real
impact study as to what the result is going to be, I think it's
absolutely critical that that be brought to the attention of
people.
We see it in Windsor right
now. With the advent of the casinos in Detroit, the Windsor
casino is still doing well, but it's not doing as well as it used
to. That may even get worse as more and more operators come into
that area.
I just wanted to say that I'm totally supportive
of your position and I wish you well.
Ms Holmes:
Thank you very much. I'd also like to note for everyone here that
the investment that the industry has put in to developing the
infrastructure for the slot operations at the racetracks is
equivalent to what the lottery corporation has been putting in as
well, so that we truly have been equal partners in this one.
That's why, as partners, we don't see that we should have the
opportunities and the market diminished by the government putting
in competition down the road, which has happened in the Chair's
backyard with the Point Edward casino for Hiawatha racetrack.
We've seen the numbers drop there since the table games have gone
in at Point Edward.
The Chair:
With that, on behalf of the committee, thank you very much. It's
always nice to see somebody from the constituency.
We're running about five
minutes ahead of schedule, so we'll recess for about five minutes
until the next presenters show up.
The committee recessed
from 1648 to 1656.
CANADIAN UNION OF PUBLIC EMPLOYEES-ONTARIO
DIVISION
The Chair:
If I can get your attention, we'll bring the committee back to
order. Our next presentation is from the Canadian Union of Public
Employees, Ontario. I would ask the presenters to come forward
and state your names for the record. On behalf of the committee,
welcome, and you have half an hour for the presentation.
Mr Sid
Ryan: My name is Sid Ryan, the president of CUPE
Ontario. On my left is Judy Wilkings. Judy is the legislative
liaison for CUPE Ontario. On my right is Shannon McManus, who's a
researcher with CUPE.
I'd like to thank you for
the opportunity to present the views of CUPE Ontario with respect
to what the Ontario government should do in its upcoming
provincial budget. The provincial budget has a significant impact
on CUPE members, both directly as workers in the broader public
sector and as residents of the province. We are deeply concerned
about the provincial government's economic policies, particularly
around privatization, deregulation, the elimination of public
services, tax cuts, downloading and funding cuts.
We believe the economic
outlook is bleak. A recession appears to be on the horizon. Stock
markets around the world went into a tailspin earlier this week.
Nortel's slide shook up the markets. Daimler Chrysler and Nortel
are laying off thousands of workers in Ontario. We've seen, for
the first time in quite a while, Ontario's welfare rolls are
rising again-4,500 people last month alone.
Hello, John. How are you
doing?
Mr
O'Toole: Hello. How are you?
Mr Ryan:
Pretty good.
The Ontario tax cuts, we
believe, have not created this so-called economic growth.
Economic growth, as we've been saying all along, has been due to
exports and the booming economy down in the United States. Now
that they've gone into a tailspin, guess what's happening?
Ontario is following suit. The government must be prepared for an
economic downturn. Cutting taxes is not the answer. Tax revenues
should be invested in public services, including a strong social
safety net, to prepare for tougher times.
We believe a strong public
sector contributes to a strong economy. The government's tax cuts
have had an impact on the quality of public services. Ontario's
cities are in financial difficulties because of downloading,
amalgamation and cutbacks. Schools and students are damaged by a
rigid and inadequate funding formula. Social service agencies
cannot provide the quality of service they have in the past.
Child care centres are closing. The quality of emergency hospital
services has fallen.
More tax cuts, we believe,
are extremely foolhardy. Personal and corporate tax reductions
have already cost our province $35 billion since the Tories got
elected. The majority of these benefits have gone to the
wealthiest people in Ontario. User fees and delisting of services
mean that poor and low-income citizens cannot afford to pay.
At the same time, the
government continues its attack on the poor, in particular,
people on social assistance. During the most productive period of
time in our history with respect to growth in the economy and
wealth-in the last five, six, seven years-we have not seen a
single penny go into welfare payments. As a matter of fact, we
think it's quite disgraceful that you didn't even reach the
cost-of-living increases for people on assistance at a time when
corporations and businesses were making profits in this booming
economy in the last number of years. As I say, it's due to what
happened in the United States and has nothing to do with what the
Tories did in this province. Not one single penny was put into
the minimum wage; people were earning $6.85 an hour. In the
United States, during the same period of time, the minimum wage
was increased on at least two occasions.
We believe the budget
reflects the priorities and values of the government, and it is
possible to make other decisions. We urge this government to
reinvest in public services, like health, education, municipal
and social programs.
We see a tremendous push to
privatization in all of our sectors. We believe this government
is the most interventionist in the history of this province. Its
policies continue to have a dramatic and negative impact on every
part of the public sector. The government has centralized control
and interjected itself into the broader public sector. It is
pressuring every sector to hand over services to private,
for-profit operators. Amalgamation, downloading and funding cuts
are designed to force cash-starved cities, hospitals, schools and
universities to contract out and privatize services.
The government continues to
be committed to the privatization of public services, despite
public opposition. For example, we all know that both in Ontario
and across Canada, Canadians and Ontarians will not accept a
two-tier health care system, yet we've got Tony Clement, under the darkness of night,
flying across to the UK to take a look at their disastrous health
care system. I know about it first-hand. I've lived there and
have seen it. Believe me, it's a shambles and it's nothing that
this country wants to emulate, yet Tony flies across and he
figures he can come back with some of the policies that destroyed
the health care system in the UK. Just today and yesterday, your
Premier was out front saying that he too would like to see an
increase in the amount of privatization taking place in the
health care system.
We believe privatization
will inevitably cost taxpayers a great deal more as profits go
into the pockets of individual shareholders. Privatization also
leads to job loss and lower salaries and benefits. This province
cannot afford to have more good jobs replaced by so-called
McJobs. This province cannot afford to lose service quality
because directors are paying attention to the bottom line.
Privatization is bad for the average taxpayer, bad for workers
and bad for Ontario's economy. Privatization is far more
dangerous now because of globalization and trade agreements where
it increases the danger of a foreign takeover of Canadian assets
and services and increases the likelihood that large private
monopolies will gain control, private monopolies that can hold
the public to ransom. Instead of privatizing, we encourage the
government to rebuild the public services that serve as the
foundation of this province's prosperity.
Amalgamations, downloading
and reduced-funding legislation, such as Bill 140, have created a
crisis in Ontario's municipal sector. Right now, municipalities
are relying on money from the OMERS pension plan. The 7% they've
received in windfalls from the OMERS pension plan will soon
disappear once the surplus is eaten up. That's going to place
municipalities in a crisis when they try to find that additional
7% to pay pension plan contributions, which they have a break on
right now.
Bill 140 prohibits
municipalities, for example, from raising property taxes on the
business community. This is grossly unfair to homeowners, who are
now asked to share the complete responsibility for all the
downloading: GO Transit, social housing, transportation and
welfare are being picked up by homeowners. We cannot see the
logic, for example, in having a taxpayer or a homeowner in the
city of Toronto subsidize a commuter who gets on the GO Transit
system in, say, Pickering and takes the GO Transit system out to
Oshawa and somehow that's subsidized by the homeowners in the
city of Toronto. That makes no sense whatsoever. It makes no
sense that General Motors can lay off some of its workers in
Oshawa, who eventually find their way on to the welfare rolls,
and if you happen to live in the GTA or in the Toronto area,
homeowners in that area pick up the costs for private sector
corporations laying off their workers. That makes no sense. There
have to be alternative revenue streams that are available to
provincial governments, and we lend our voice to a lot of those
people who are calling for a portion of the gas and the
transportation taxes to be transferred into municipalities so
that they can deal with the downloading created by this
government.
Just recently, we had a
report card on children released-in fact it was earlier this
week-and it found that the infant mortality rate for the city of
Toronto is 30% higher than in the rest of Ontario. The number of
children on waiting lists for subsidized child care has grown to
1,400. The report found that poor children's health is declining
because of a lack of affordable housing. Six thousand children
are homeless. Despite all this, the municipality is considering
eliminating a prenatal care plan that feeds hundreds of pregnant
women, breakfast clubs that feed 4,500 children and a dental care
system that serves 32,000 low-income children and seniors. This
disaster can be directly traced to the lack of provincial
funding.
We call upon the government
to stop pressuring Ontario's municipalities to adopt contracting
out, competitive bidding, public-private-sector partnerships and
other forms of privatization.
In post-secondary
education, Ontario has led the way among provinces in cutting
funds to universities. Since 1990, funding cuts have led to a
loss of 1,000 full-time faculty and 1,100 full-time non-academic
staff. At the same time as staff has been cut, student enrolment
has increased by a third. We now have larger class sizes, higher
workloads for faculty and staff and reduced services for
students. University libraries now buy 25% fewer books than in
the 1970s, while journal acquisitions have been cut even more
dramatically. In Ontario, tuition fees have more than doubled
over the decade from an average of about $1,700 in the early
1990s to almost $4,000 in the year 1999-2000. The average student
debt load for a four-year undergraduate program has tripled from
$8,000 up to $25,000, and it continues to grow.
We would urge that the
government restore public funding for the post-secondary
education system so that students do not face crippling debt
loads upon graduation. We'd like to see them freeze student fees
and lower tuition. We'd like to see the government establish a
fully funded student grant system and eventually move toward the
elimination of user fees altogether, similar to what they've done
in 14 OECD countries. Certainly in the place where I was born,
which John is very familiar with, they've got free university
education, which has contributed to the economic boom in the
Republic of Ireland. That's a system we should be moving toward,
not tuition increases which are depriving a lot of low-income
families and families of modest income of the ability to send
their children to a post-secondary institution. We should not be
allowing the corporate sector, for instance, to take over our
university assets through our SuperBuild fund where many dollars
are being filtered into private sector-public sector
partnerships, which again are driving up the costs of university
tuition in this province.
In the health care area, we
want to take a look at a couple of the problems. CUPE recently
surveyed the front-line staff in chronic care and former chronic
care facilities. Over half reported performing unpaid work and
79% reported the workload was hurting their health. Many staff reported patients
who could not get out of bed or their wheelchairs due to a lack
of resources. Not surprisingly, where the government had cut the
funding, front-line staff reported even more problems with unpaid
work, workload and patient care.
At the beginning of
February 2001, the government was forced to recognize that its
chronic care policy was not working. The government announced
that four facilities in Toronto and Hamilton that it had planned
to convert to long-term-care facilities would now remain open as
chronic care facilities. While we appreciate the government has
partially recognized its error, it continues to ignore similar
problems elsewhere.
Take, for example, St
Vincent de Paul Hospital in Bob Runciman's riding in Brockville.
It is suffering from severe underfunding. Thirty chronic care
beds in St Joseph's in Guelph are becoming long-term-care beds.
In Ottawa and Windsor, whole facilities, like the Perley and
Rideau Veterans' Health Centre and Malden Park, are being
converted to long-term care with funding chopped in half. The
patients are not changing; they just get less care.
The government must stop
the conversion to long-term care, stop the cuts in chronic care
beds and stop funding chronic care beds at an inadequate level.
Clearly, what this means is, chronic care hospitals are funded at
approximately $200 per day per individual in those chronic care
hospitals. Moving into a long-term-care facility means those same
patients will now receive approximately $100 per day toward
patient care. Clearly it is not enough.
One I'm very familiar with
is the community care access centres. We released a report in
CUPE. If there's anything that particularly underscores the
bankruptcy of the government's policy with respect to
privatization, this has got to be it. Privatization of CCACs has
taken $247 million out of the industry. It's a $1-billion
industry right now. What we've discovered through our in-house
survey of front-line workers, supervisors and patients who
receive the care is that, for example, in most of the communities
you've got 16 agencies now delivering home care. These agencies,
each and every one of them, has a CEO-you've got senior managers,
you've got a financial department, you've got a human resources
department, you've got front-line supervisors, for all 16 of
these agencies. Replicate that now across 44 CCACs across Ontario
and you've got a disaster on your hands.
1710
This is the government that
says it came to fix government, that says it came to eliminate
red tape. You've just put a mountain of red tape into the home
care sector of this province. You've completely privatized it.
You've taken out of existence organizations like the VON, which
have been delivering home care, say, in the city of Windsor for
75 years-one organization, one agency with one set of CEOs, one
set of front-line managers, one set of senior managers and one
set of financial officers. That's all it took to run the system.
You've now given them 16 sets of all of those. You've duplicated
it. You're taking money out of the system. Money that should be
going into front-line care, into home care in all of our
communities is now going off in duplication and in profits for
each of these agencies that you've put into a competitive bidding
model.
Plus, now you've got to
have a monitor in place to make sure there is no fraud in the
system, because the tendency is to start billing people in their
homes inappropriately. There is one company that you gave the
service to in Windsor, Olsten, which was sued by the American
government for defrauding the American health care system of
US$60 million. These are the folks who are now operating the home
care system in Ontario. And there are no savings to be had. A
quarter of a billion dollars is coming out of the system in
waste, which should be redirected to the front-line system.
We would urge a complete
overhaul of the competitive bidding model. We'd take a look at
this duplication that you've built into the system; jobs for the
Tory boys, the backroom boys. We say, get them out of the system.
There is no place for the private sector in the delivery of home
care in Ontario. If we take them out, we will save ourselves a
quarter of a billion dollars a year. Let's put that where it
should be put, into the front-line services.
In the area of pay equity,
employers are expected to cover pay equity adjustments without
additional funding from the government. Here again we're finding
that female workers in child care centres, nursing homes and
social service agencies are being denied legislated pay equity
instalments because this government has refused to continue the
funding of these monies. Several agencies may close because they
cannot meet their pay equity obligations. We're finding this at
the bargaining table time and time again, where women in
particular are being forced to make a decision between
maintaining their job or going after the pay equity increase
which they're entitled to under legislation. This government is
refusing to fund its pay equity obligations, and it's time in
this budget that you recognize that these agencies are in
desperate straits trying to meet their pay equity obligations,
keep their doors open at the same time and deliver crucial
services, such as the services for people with developmental
handicaps.
The government should
increase the funding for the front-line services for people with
developmental handicaps. A typical wage in this area is less than
$15 an hour. Workers in this sector have been undervalued and
under-compensated for their work. Last year KPMG-no socialist
organization, I can assure you-released a study that showed that
workers in this sector earn 20% to 25% less than their
counterparts in other sectors.
Burnout is increasing
because staff are working at more than one job to make ends meet.
Community agencies are having trouble recruiting and retaining
workers. Agencies have been forced to close programs because they
cannot find trained, qualified staff, because they won't work for
less than $15 an hour. These are all post-secondary-educated
individuals who won't work for that kind of salary. The study
found that facilities are finding it increasingly difficult to maintain stable
care because of the rapid turnover of staff.
This sector provides
support for some of the most vulnerable members of our society
and their families. We urge the government to provide agencies
with enough funding to stop this crisis.
Finally, I just want to
talk briefly about the environment. The government's Red Tape
Commission's Web site features a cartoon illustrating what the
government considers to be red tape: permits, audits, guidelines,
certificates, rules, forms, investigations and approvals. We urge
the government to put more money into "red tape" that can protect
our environment: the water we drink, the air we breathe.
Inspections, investigations and approvals are not red tape; they
are necessary.
Municipalities should
receive more money for water and sewage infrastructure. Polluters
should be held accountable for the damage they do to the
environment, and for the sake of our health and our children's
health, we need to have proper protections put in place. You may
call it red tape; we call it protection for the quality and the
standards of drinking water in Ontario.
With that, I've finished my
presentation and I'll be more than happy to take questions.
The Chair:
Thank you very much. We have three minutes per caucus, and I'll
start with the government side.
Mr Galt:
Thank you for your presentation. It's obvious from your comments,
I don't think we've been doing anything right in the last six
years, but we keep trying.
I notice you didn't
mention, and I think it's important to recognize, that this last
year public service unions increased by an average of 2.5%, up
from 1.9% the year before. That's the first time in a long time
that the public service unions pulled ahead of the private sector
unions. Last year it was 2.3% for the private sector and the year
before it was 2.6%.
But in spite of the fact
that you're telling us we haven't done anything right, we have
developed a reputation of doing what we said we were going to do
in the Common Sense Revolution and again in the Blueprint. We
have been carrying those out and the public has had the
opportunity to see what we were going to do. They really didn't
quite believe that when we came out with the platform in 1994, a
full year ahead of the election. They elected us and were quite
surprised at the fact that we did do essentially what's in that
platform. Again, we're heading pretty well through the Blueprint
that we came out with in 1999.
If we were to follow the
recommendations you have here, it would be basically the
experiment that the Ontario government went through from 1985 to
1995, when the debt increased three times. As a matter of fact,
in the early 1990s, that five-year term, the debt more than
doubled and that was more debt than had occurred in the province
of Ontario since the beginning of time.
In spite of all that, I
have to congratulate you on putting your name on a ballot and
coming out. You are very persuasive and enthusiastic in your
position. You did put your name on a ballot and an awful lot of
people are very reluctant to do that, so I congratulate you for
coming forward in the 1999 election.
Mr Ryan:
You talked about doing what you promised to do. I don't recall
anywhere in the Blueprint or the Common Sense Revolution where
you said you would ask the most vulnerable workers in Ontario to
work a 60-hour workweek, for example. I don't recall anywhere
where you consulted with people and said, "Your overtime will be
averaged over a three-week period, where we'll take away overtime
from people earning minimum wage and average it over a three-week
period."
I don't recall your coming
in and saying you would introduce privatization into the health
care system, as you have done in the home care sector, for
example. I don't recall your telling people that you'd cut the
Ministry of the Environment staff by at least 50%, resulting in
the crisis in Walkerton, the likes of which this county has never
seen. I don't recall any of those promises whatsoever, Doug. You
can spin it as you like about "We did what we said we would
do."
You said you would get red
tape, for example, out of some of the systems. As I've indicated
to you, you've introduced a mountain of it into home care
facilities, resulting in a quarter of a billion dollars a year
being siphoned off to your friends in the private sector. I don't
recall your saying that to anybody at all in the system.
In terms of wage increases
that you say we may have received in the last year, I will remind
you that in the public sector we have taken wage decreases for
the last 10 years. When you factor in inflation, over the last 10
years there have been no wage increases whatsoever; when you
factor in inflation, instead we've taken a decrease.
So now we're seeing an
increase for the first time in 10 years, averaging about 2%. This
was about the time when the Tories tried to introduce a piece of
legislation giving themselves a 42% wage increase for that same
period of time.
Mr Galt:
There's been no increase.
Mr Ryan:
You may not have supported it, but you did do it. You tried to
get away with it until the public outcry forced you away from
doing it.
I do appreciate your
comments about putting my name on the ballot. I got my butt
kicked, but hey, it was a lot of fun.
Mr
Kwinter: I'm tempted to refute some of the things Dr
Galt said about them carrying out their plans, because there's a
whole range of things that were never mentioned in the Common
Sense Revolution that you immediately implemented and now you're
backtracking on, things like, "We will not provide amalgamations
unless people want them." That had no impact at all on what
happened in Toronto. You said, "This is it; too bad." Even though
over 75% of the people in a referendum said they didn't want it,
you still went ahead with it.
Having said that, earlier
in these hearings we talked about the community care access
centres. I mentioned a situation in my riding where the operators
decided to terminate a contract they had and the sole criterion
was the bottom line. I mentioned to the committee that I'm caught
in the middle. I have been getting calls from the providers, who
have been told that the contract is terminated and they're out of
a job, and I'm getting calls from the patients, who say, "I had
this wonderful relationship with my health care provider and now
they tell me that they're no longer going to be servicing my
needs because someone else got the contract." That was last
week.
1720
I thought this was
something that would sort of pass over. If anything, it's gotten
worse. Because I have been in on these hearings-and, as you can
see, most of the time I'm here by myself-I go back to my office
and the pile of pink telephone call slips keeps getting bigger
and bigger. Every time I go through them, 80% of them have to do
with this one issue. If this is an indication of what is
happening and what is going to happen with the privatization of
some of these services, where patient outcomes are of no
concern-it's really, "How can we make the most money?"-then we
have a problem. I know you probably agree with me, but do you
have any comments on that?
Mr Ryan:
I'll get you a copy of the report we released, because it's
chockablock full of stories similar to what you were just talking
about.
I'll give you an example.
What happened essentially is that under the NDP government you
had the MSAs, the multi-service agencies, which was essentially
one-stop shopping where you had one agency, for all intents and
purposes, delivering all of the services, and they could
coordinate the visits.
Today what they do is they
take the service-it very well may be drawing of blood-and they
will hive that off to one of the private sector companies.
Somebody else will have the contract for providing home care
services. Somebody else will have the contract for therapies,
whether it be massage therapy or whatever. Before, it was all
done in-house by one group of folks. Now you'll have two or three
people making home visits to one individual.
One of the stories we found
out last week was the drawing of blood. One has a contract to
draw it intravenously; they put a tube in the arm and it can be
drawn out on a regular basis. Other folks have a contract for
drawing blood directly, right from the arm itself. We had a
supervisor sitting in a home who said he was not qualified to
draw blood from the arm but he could draw blood from the
intravenous feed in the arm. So the supervisor made a
40-kilometre trip to the home. One of the employees made a
40-kilometre trip to the home. Neither one of them had the
contract to transport the blood from the person in the home back
to the CCAC to send it off to the facility to have it tested.
When you add up the time lost, the duplication, you can see where
we come up with this whole $247 million.
There are numerous stories
of front-line workers like that. Ordering of supplies, for
example: now they cannot talk to the supplier. In the past, the
front-line worker, the RN or the RPN, was able to call directly
to the suppliers to get precisely the materials they needed. Now
you have to call the agency that you work for. The agency has a
requisitions department. They call the CCAC. The CCAC checks back
with the employee to make sure that this particular material is
needed. They call the supplier. The supplier invariably sends out
the wrong material. It travels all the way out 40, 50 kilometres
to the home care worker. They get it; they see it's the wrong
material, not what was requested. So the cycle starts all over
again. That's duplicated, they say, on a regular basis throughout
the system. So the system is a shambles. It has to be completely
reformed.
The Chair:
I have to go to Mr Christopherson.
Mr
Christopherson: Thank you, Sid, for your presentation.
I'm sure you've read the paper this morning, where the Premier
said that any ministers who have spending pressures that they
want to bring to cabinet had better have offsetting cuts within
their own ministries.
Leah Casselman was in
earlier on behalf of OPSEU, and I asked her the implications for
communities like mine in Hamilton and others. I know you travel
just as extensively across this province as any member of the
Legislature, arguably more often, because your job is to be out
there and you don't have to be here.
I'd like to get your sense
of what it means for, in particular, municipal services. One of
the reporters asked me that: "What's the impact on local
services?" My sense of it-I mentioned and I went on at great
length about health care, but education is the same way. They're
all under tremendous pressure just to meet existing
circumstances, never mind start moving into the investment end of
things of where we ought to be. They need new money just to hold
their own, which is, as I say, already somewhat back from where
we should be.
What could anybody who is
watching or who reads the Hansard expect, in your opinion, if the
government on the ground, in our communities-it's what I call
kitchen table economics. What can they expect in their
communities if indeed these ministers start to put forward new
expenditures just because they absolutely have to, but are making
corresponding cuts? What are the implications for the average
person, their family, their neighbourhood, their community?
Mr Ryan:
We're actually beginning to look at this problem. We're taking
surveys of all the sectors where cuts have been implemented.
We've done school boards, children's aid societies, associations
for community living, and people who deliver the workfare
program, welfare workers. We've measured the impact of the cuts
on those individuals with respect to their health personally with
massive increases in stress, which is not compensated because the
Tories removed chronic stress from workers' compensation, from
being compensable-people going out sick, headaches.
Recently we had one of our social service
workers in court being charged with failure to conduct her job in
an appropriate manner. She managed to get cleared of the
allegations, but the workload resulting from changes the
government has made-some of it good, by the way, Doug. There were
some changes around children's aid and reporting of children at
risk of abuse, and that was positive. But it increased the
workload tremendously because there are a lot more calls coming
in now where doctors and teachers and nurses and public health
officers have a greater responsibility to report.
Workload is really, really
a problem. For example, in the education system in the early
1990s, for children with special needs, we had one on one. We had
educational assistants whose job was to deal with those children
with special needs one on one. Now it's one on four. So it's four
children with special needs to one educational assistant.
Clearly, they cannot deliver the same quality of service as they
were in the past. This is the implication and the fallout of
funding cuts.
Now we're beginning to
measure the fallout on the individual person delivering the
public service, and it has taken its toll on health. We had a
special conference just last weekend in CUPE, a workload
conference. We brought in international speakers to examine this
phenomenon, which began about five or six years ago but is now
manifesting itself in illnesses and sicknesses and people not
reporting for work. So it's a huge problem that we're
experiencing and I think we're going to see more of it if there
are more cuts in the future.
Mr
Christopherson: I just want to say and get it on the
record that every labour leader or economist that spoke for their
unions, every one of them, has raised the issue of the minimum
wage. I just want the record to reflect that there's no political
benefit to any of these labour leaders, because none of the
people who are affected by minimum wage can vote for them. The
only people who are coming in here and speaking about minimum
wage needing to be increased are the elected officials and staff
of unions, and that's to your credit, all of you.
The Chair:
With that, I have to bring it to an end. Thanks very much on
behalf of the committee this afternoon.
Mr Ryan:
Thanks a lot.
The Chair:
We've been informed by the Ontario Forest Industries Association
that they will not be making their presentation this afternoon.
They have cancelled. I guess that brings our hearings to an end.
However, there are a few items of business.
First of all, I would like
to thank the staff and the committee members for their
co-operation during the past eight days. I think for all the
members and the staff it's been quite demanding, but I certainly
appreciate all your co-operation.
Mr
Christopherson: On a point of order, Mr Chair: I don't
do this lightly because you and I have crossed swords before, but
I just want to put on the record that you've done an outstanding
job of chairing. You've found one of the best touches I've seen
between being able to keep us on track and yet still finding that
30 seconds to let people wrap up or make a comment.
It's a roundabout shot at
you, Doug, but I would have done this anyway, because I think you
could have done that. That's not why I'm doing it. It's to
compliment Marcel. Really, you kept us on time and you didn't
really have to elbow anybody in the face to do it, and that's a
real trick. I just wanted to compliment you on that. I agree with
you that the staff has done a tremendous job.
I also, while I have the
floor, want to reflect in the Hansard that OSSTF has responded to
the response of research, and I would expect this will be a kind
of ongoing thing. But I do want the record to reflect the fact
that they've noted what they consider to be-how best to phrase
it? Let's just say they approach the calculation differently and
I think are still arguing that their stats hold, notwithstanding
certain members' attempts to portray it otherwise.
The Chair:
Thank you very much. I guess the next step is that by March 19
the research officer will deliver a draft copy to all the
committee members. I have no say over this, but it looks like
March 22 will probably be the day that we'll have an opportunity
to discuss the draft report that will be circulated on the
19th.
Any further comments? If
not, thank you very much and we're now adjourned.
