EASTERN ONTARIO DEVELOPMENT CORP
CONTENTS
Wednesday 4 December 1991
Appointments review
John Dewar
John Walker
Subcommittee report
Eastern Ontario Development Corp
TVOntario
STANDING COMMITTEE ON GOVERNMENT AGENCIES
Chair: Runciman, Robert W. (Leeds-Grenville PC)
Vice-Chair: McLean, Allan K. (Simcoe East PC)
Carter, Jenny (Peterborough NDP)
Elston, Murray J. (Bruce L)
Frankford, Robert (Scarborough East NDP)
Grandmaître, Bernard (Ottawa East L)
Hayes, Pat (Essex-Kent NDP)
McGuinty, Dalton (Ottawa South L)
Marchese, Rosario (Fort York NDP)
Stockwell, Chris (Etobicoke West PC)
Waters, Daniel (Muskoka-Georgian Bay NDP)
Wiseman, Jim (Durham West NDP)
Substitution: Chiarelli, Robert (Ottawa West L) for Mr Elton
Clerk pro tem: McMillan, Nicole
Staff: Pond, David, Research Officer, Legislative Research Service
The committee met at 1006 in room 228.
APPOINTMENTS REVIEW
Resuming consideration of intended appointees.
JOHN DEWAR
The Chair: The first matter on our agenda this morning is the half-hour review of intended appointee John Dewar to the Commercial Registration Appeal Tribunal. Mr Dewar, would you like to come forward, please, and take a seat. Welcome to the committee. This is a half-hour review and we split it up 10 minutes per party. You have been selected for review by the official opposition, so I am going to look to Mr Grandmaître to begin the questioning.
Mr Grandmaître: Good morning, Mr Dewar. Have you ever appeared before this tribunal?
Mr Dewar: No, I have not.
Mr Grandmaître: How familiar are you with this tribunal?
Mr Dewar: I would guess not really familiar. I have heard a little bit about it. I am not familiar with the tribunal at this point.
Mr Grandmaître: How did you find out about the vacancy on the tribunal board?
Mr Dewar: Through the Used Car Dealer Association of Ontario. We have an office and staff in Toronto. I am not sure if you are familiar with Bob Beatty, but he is our manager and he told me about this. I thought it sounded interesting and I might be able to contribute something to the industry.
Mr Grandmaître: What is your experience in conducting hearings or conducting meetings? Tell us about yourself as a businessman.
Mr Dewar: As far as conducting meetings is concerned, I spent about eight or nine years with the Transportation Safety Association of Ontario. My job was as a field representative and to organize and carry out safety meetings and safety training and that type of thing, so I have had a little bit of experience.
Mr Grandmaître: I was going to ask you if this tribunal is serving the consumers well, but I suppose you would not be able to answer my question.
Mr Dewar: I would not be, no. At this point I do not know.
Mr Grandmaître: This tribunal is funded by mandatory contributions from motor vehicle dealers and I want to find out how this works. What are the mandatory contributions from dealers?
The Chair: David, are you familiar with that?
Mr Pond: The witness is an expert in the field of motor vehicle dealers, and I believe his responsibility will be to hear appeals from the motor vehicle dealers' compensation fund. Consumers who have a claim against the fund and are dissatisfied with the decision can go all the way to the tribunal. The fund itself is funded by a mandatory contribution from motor vehicle dealers. The tribunal is not. The tribunal is a quasi-judicial tribunal which is funded out of the ministry. The fund is funded by the industry, so to speak. It is a self-regulatory mechanism, if you like, but I believe the tribunal is funded by the ministry and fees. It is one of these fee-collecting tribunals, like most quasi-judicial tribunals in Ontario. It would probably be a bit misleading to say it is funded directly by one industry over which it has jurisdiction. It is probably more correct to say it is funded simply by fees paid by the litigants who appear before it.
Mr Grandmaître: Oh, I see.
The Chair: Anything further?
Mr Grandmaître: So you cannot tell me anything about the appeal tribunal at all?
Mr Dewar: I can tell you a little bit about it. I guess a case would be if some dealer did something seriously wrong and it was considering cancelling his licence, then the tribunal would sit and decide if it felt that whatever had happened was serious enough that the person's licence should be cancelled or whether he should be given another chance.
Mr Chiarelli: I have just a couple of questions here, Mr Dewar. It is called the Commercial Registration Appeal Tribunal. Do you know generally the range of registrations or permits or licences that are covered by this particular appeal tribunal?
Mr Dewar: I do not know. I am under the impression that it would only be automobile dealers.
Mr Chiarelli: What would be the nature of the decisions you would make if you were to be given this appointment and you were to sit on a hearing? What is the range of decisions you might be required to make?
Mr Dewar: I do not believe I could answer that question at this point because I have not been involved with the tribunal.
Mr Chiarelli: Do you have any idea of the nature of the penalities or the consequences that could accrue to registrants who are appealing and are refused licences or permits or whatever? Could they be banished for life? Could they be given fines? Could they be denied a right to their livelihood? Do you have any idea of the consequences and the nature of the decisions you will be making?
Mr Dewar: Yes. Again, depending on what the person had done -- I realize that if his licence were suspended you would be affecting his livelihood, but I feel the reason for the tribunal would be to make the car industry a more respectable industry and have more people do things right. It would be brought to their attention, if they were doing something wrong, just how serious it could be.
Mr Wiseman: I would like to talk a little bit abut the changing role of car dealerships. You and I were chatting before and I told you I have a new car. I used to like to do all the mechanical work and the oil-changing and all the tune-ups and everything myself. I do not think I can do that with the new cars.
Mr Dewar: It has become much more technical, and when you are purchasing a car it has to be safetied by a registered dealer with licensed mechanics, so you cannot do a lot of your own things.
Mr Wiseman: I think CRAT may start to have hearings from people who are questioning the assessment of the mechanic, because these cars are now hooked up to computers and everything, and how are they going to be able to differentiate between what is an honest analysis of what needs to be done to the car and maybe something that is being padded? Do you think that might be a problem for CRAT in the future?
Mr Dewar: How you assess or how do you decide in any field?
Mr Wiseman: But as a person on the panel you may have somebody coming and making allegations about a dealer who is consistently overcharging in terms of his diagnostic analysis of the vehicle and I think you are going to have some kind of judgement in that area.
Mr Dewar: I am not sure of the strength of the panel, but if this were the case, I guess you would do a study of this particular operation and, being in that field, you could work out an average of what seemed fair. If this fellow had a list of files that were all double or triple the average, then I think he should be talked to and a decision would have to be made from there.
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Mr Wiseman: The GST is throwing a wrinkle into the whole used car business. Perhaps you would like to describe what that wrinkle is, and whether or not CRAT might be able to deal some of these so-called curbsiders.
Mr Dewar: We have an association, the Used Car Dealers Association of Ontario, with, I would guess, about 5,000 members, and we have a committee within this association doing a lot of work on that right now. If a dealership sells a car, it has to collect GST. If a private individual sells a car, he does not collect GST.
If we buy a car from an individual we get an input credit. But that becomes very complicated and cumbersome and hard to explain to an individual. People seem to have the thought in their heads, "If I buy it privately, I do not pay GST and if I buy from a dealer, I do pay GST."
Mr Wiseman: What is there to protect the consumer if they buy from a curbsider?
Mr Dewar: Nothing, and that is one of the things, as dealers, we are using to try and bring people to dealers. We provide a warranty, we guarantee the vehicle to be lien-free and that the car has been properly safetied and is roadworthy, where if they buy from a private individual they do not have any of this.
Mr Wiseman: Are you aware of any dealers actually selling vehicles and professing to be private individuals and yet their salespeople are selling these vehicles?
Mr Dewar: I am not aware of any dealers doing this. But I am aware, and it is a pretty common thing in our industry, that an individual on the street can be selling his uncle's car, his mother's car or his brother's car, and if you pay close attention you will find that this person sells 10, 15 or 20 cars in a year. What he is really doing is buying and selling without a licence, and they find ways to get around the tax.
There is a move afoot by the Used Car Dealers Association of Ontario to try and get rid of these curbsiders. At the UCDA office, they do a study of newspapers and if they see the same phone number coming up ad after ad where it is a private car, they check this person out and see what he has been doing and where all these cars are coming from.
Mr Wiseman: If that would lead to a dealer or somebody who worked for a dealer doing this kind of thing, would CRAT have a role to play in reviewing the licence of that particular salesperson or that dealership?
Mr Dewar: I would think yes. If a registered salesperson for a dealership was curbing on the side, they would look at him and see how serious, how long or how much of this he has been doing. I guess it could lead to his licence being cancelled. Like your driver's licence, if you continue to speed, they are going to cancel your privileges for a while, and if he continued to do this and had no intent to correct it, then they would have to take whatever measure might be necessary.
Mr Wiseman: I have more questions. You have been in the car dealership a fair length of time, I see from your résumé. From 1955 until 1968, you were with Meredith Connelly Motors in Sudbury and then from 1968 to 1975 with Fairway Mercury Sales and then 1975 to 1980 with the Transporation Safety Association of Ontario here in Toronto. Now you are the owner-operator of your own sales outlet. So you have had quite a long history in this business and I guess you have seen a lot of changes. Do you foresee any difficulties or any changes coming that CRAT or the government should be concerned about that are starting now?
Mr Dewar: The only change I see, and our association is working on it, is the GST. If an individual is going to sell a car, the licence bureau would have to collect the GST when the transfer is made, the same as they collect the PST. The problem now is that the government agencies will not collect GST in Ontario at the licence bureaus, but they are working on maybe putting this into effect. That way it gives the dealer a better shake, because you can buy the same car from your neighbour for $10,000 plus your Ontario sales tax, where if you buy from a registered dealer, you are paying another 7%, which means $700. It becomes worthwhile.
Mr Wiseman: We were talking earlier about what happens sometimes with the PST.
Mr Dewar: Yes. Our used car dealer association is working on this as well. What happens is, an individual will buy a car from another private individual. First, they do not pay the GST. Second, they will say, "Okay, the car is $10,000, and you will pay 7% sales tax at the licence bureau." The next question the buyer will have is, "How about I pay you $4,000 cash and a cheque for $6,000, and then we make the bill for $6,000, and then I only pay sales tax on the $6,000?" The $4,000 does not show up anyplace, so the province loses. Our association is working on this to try and get it straightened out so that most cars go through a dealership.
The Chair: Do you have one more quick question?
Mr Wiseman: What strengths do you bring to the tribunal in terms of your background and your own attitudes towards cars, the sale of cars and dealerships? What skills and qualities do you bring to this that are going to make this panel better because you are on it?
Mr Dewar: I guess the skills of being in the business for some 30 years. I have always prided myself in trying to do it the right way. In 30 years, you see all the wrong ways. So I think, knowing the difference between the two, hopefully we could correct or penalize the people that are not doing it to code.
The Chair: Mr Chiarelli, you have about two and a half minutes, if you want to use it.
Mr Chiarelli: It is my understanding that your appointment is a general appointment to the tribunal. Although it is being made ostensibly to deal with panels for the motor vehicle dealers' compensation fund, it would still be possible for you to be selected to sit on hearings dealing with other industries.
The tribunal itself deals with a wide range of legislation, licences and business practices, including the Cemeteries Act, the Collection Agencies Act, the Consumer Reporting Act, the Funeral Directors and Establishments Act, the Liquor Licence Act, the Mortgage Brokers Act and the Motor Vehicle Dealers Act, which you will have some familiarity with.
The briefing notes indicate that the tribunal is an important, if low-profile, quasi-judicial tribunal that exercises significant influence over commercial practices in the province. Members of the tribunal need to have or acquire insight into the operation of a wide variety of businesses and professions and be able to conduct a hearing which abides by quasi-judicial procedures.
Do you think you would have an obligation to restrict yourself to the motor vehicle dealers' compensation fund? Or do you think it would be reasonable and appropriate for you to accept sitting on a panel, if you are asked, dealing with the Liquor Licence Act or the Mortgage Brokers Act? Would you volunteer to disentitle yourself to sit on hearings that require an expertise in areas other than those you are familiar with?
Mr Dewar: I think not. I think automobile people would sit on automobile cases. Knowing nothing, or very little, about real estate or all these other fields and how they operate, I think I could not accept a position to judge something I know nothing about.
Mr Chiarelli: Thank you.
The Chair: Mr McLean, you arrived just in time to take advantage of your 10 minutes if you wish. Mr Dewar is an appointment. You are going to pass? All right. Mr Dewar, that concludes your grilling for the morning. We thank you for your appearance and we wish you well.
Mr Dewar: Thank you very much.
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JOHN WALKER
The Chair: The next intended appointment is John K. Walker, who is the intended appointee as the public director of the Toronto Futures Exchange Board. Mr Walker, would you come forward please. Welcome to the committee. We appreciate your appearance here this morning. You have been selected for a half-hour review by the government party. We allocate 10-minute slots to each party for questioning. We will look to the government party to begin questioning.
Mr Wiseman: I have a little bit of knowledge, about this much, about the futures market, so I have some questions. The first is, what is the relationship of the Toronto Futures Exchange to the Chicago commodity futures exchanges and how do they interact with one another?
Mr Walker: I do not think they interact at all. I am not aware that they do.
Mr Wiseman: But would not prices being determined in the Chicago futures market have an impact on prices in Toronto?
Mr Walker: I would think the usual thing is that brokers will interact between different markets, but I am not aware that there is any interlinking of the Toronto futures market with the Chicago. Second, the Toronto futures market, so far as I know, would be dealing at the moment only with silver futures and I am not aware that those are traded in Chicago. They would be traded in other metals markets.
Mr Wiseman: I guess the Toronto futures market is looking to expand and at some point it would want to get into those kinds of commodities.
Mr Walker: Yes.
Mr Wiseman: Then your role within the Toronto futures market would be as an overseer? What would your role be?
Mr Walker: The board of directors is there to oversee the management of that market to ensure its fairness and equity and that it is conducted in a businesslike way, but without prejudice to the people who are using it. The role of the board of directors is to monitor the management and monitor the market to ensure that fairness and equity are observed.
Mr Wiseman: About a decade ago, silver went right through the roof in terms of price.
Mr Walker: The Hunt brothers.
Mr Wiseman: Yes, the Hunt brothers had manipulated the market because they controlled huge capital accumulations and were able to speculate in the futures and do all of those kinds of things. Would you be responsible for looking at that in trying to protect the other consumers from that kind of game?
Mr Walker: I believe there is a compliance group, and I cannot quote you the rule the Toronto Futures Exchange has, but it would be the equivalent within a stock market of trying to acquire all the shares of a particular corporation. There are rules that prevent you making that accumulation without declaring your interest. I am not aware of what the rule would be in the futures exchange, but I presume there is a rule that would say that if you were to try to indulge in immense speculation in silver that there would be a discipline procedure to investigate and to determine who is suddenly extremely active in the market. I am more familiar with the operation of the stock exchange, and certainly when there is extreme activity, there is an immediate investigation to determine where it is coming from and why.
Mr Wiseman: That brings us to insider trading then, does it not?
Mr Walker: Yes.
Mr Wiseman: So you would be overviewing and trying to protect the consumer against people who have insider information about what a stock is going to do.
Mr Walker: Yes, that is true. I was going to say there is not an interest, but certainly there is. It is more difficult to see that in silver. It would be true in a very general degree in the trading in the Toronto Stock Exchange index futures. It is such a broadly based market that the activity in any one stock would seem to be almost irrelevant.
Mr Wiseman: In the Chicago futures, I think it is in grain, there are seven major companies in the world who deal through the Chicago exchange for grain, but there is also a group of commodity traders who have commodity groups that buy and sell futures in the Chicago exchange.
What happened was that one group had been accused of overbidding and bidding the price too high, and they were going to become vulnerable in terms of their price, so what they did was they had other parts of their organization come in and hedge their purchases so that the loss would be bottomed out. Instead of the price dropping to where it should have gone in terms of a regular market supply and demand, they were able to hold it at a certain level and then sell some of it off in order to protect their interests.
Strictly speaking, I have a bit of a problem with people being able to do that. Would you be able to watch that, to make sure that kind of internal manipulation of the market is not happening?
Mr Walker: Certainly the function of the exchange is to monitor and see that there are not those internal manipulations of the market.
Mr Wiseman: Who sets the rules on the exchange?
Mr Walker: The rules are set by the board of the Toronto Futures Exchange. They approve the bylaws and the regulations that are issued to the members.
Mr Wiseman: But the people who form the board who are in the stock exchange, they have to purchase, in an open bidding, their position on the floor, and presumably their position on the board.
Mr Walker: They purchase their seat on the exchange, yes, and then are elected among the members to be on the board.
Mr Wiseman: Is there any connection between the Ministry of Financial Institutions and the formulation of the rules of the stock exchange?
Mr Walker: There is certainly a notification and a monitoring procedure. I am not sure what the discipline is that can be imposed.
Mr Wiseman: Sorry, I missed that last part.
Mr Walker: I am not sure what the power is of the minister to step in and say to this exchange, "Thou shalt not have a particular rule," or that, "You must have a particular rule." My understanding is that the bylaws are all forwarded to the ministry.
Mr Wiseman: So it is an arm's-length relationship, really?
Mr Walker: I believe it is.
Mr Wiseman: A self-regulating arm's-length relationship.
Mr Walker: It is a self-regulating body, and the intent is that it be that. There is also a Commodities Exchange Act, which is administered by the Ontario Securities Commission. Under that act I believe there are some control procedures that would apply to the Toronto Futures Exchange. I think you would look to the Ontario Securities Commission as the government watchdog with respect to the operation of the self-regulating exchange.
Mr Wiseman: Some changes have been made over the last few years in the regulations of the Ontario Securities Commission, have there not?
Mr Walker: There has been a continual process of change.
Mr Wiseman: Were they not loosened up a little in terms of accountability?
Mr Walker: I am not aware they were loosened. Generally the direction is toward increasing accountability, continually.
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Mr Waters: In find it quite fascinating, so I am going to ask the one question, what would ever possess a person to take on a job like this for no pay?
Mr Walker: I was asked if I would be willing to do it at the point in time when I was about to retire as an active accountant, and I thought this would be an interesting thing to do. When I realized I had this committee to answer to, I was beginning to ask myself the same question.
Mr Wiseman: Since it was my selection to have you come here, I was interested just to ask the questions I asked, just for information for myself so I could be better informed. There is nothing you have to worry a whole lot about.
Mr Walker: One of the things that are certainly true is that when the job is one that does not bring with it some compensation -- I do not mean that there is any indifference on my part, because I would not intend that. At the same time, it does produce a certain ease in terms of answering whatever questions you would like to ask.
Ms Carter: This is a public appointment to a private agency, and I wonder if you know the process by which you were selected and whether there was any political involvement in that process.
Mr Walker: First of all, there is no political involvement that I am aware of, certainly none that I could be aware of. The process is that the president of the Toronto Stock Exchange and the president of the Toronto Futures Exchange co-chair a nominating committee to recommend the names of the two public governors who serve with the elected members on the board. Through my activity in prior years before I retired I was known to people within the Toronto Stock Exchange. My name was known. It was known that I was retiring, and it surfaced through those connections, I presume.
Mr Chiarelli: I have a couple of questions more general in nature. Do you have any personal sense or opinion of the economic or public good that dealing of futures generates for the economy of Ontario or for the public in Ontario? What is going on here? What benefit is this to the Ontario or Canadian economy?
Mr Walker: Historically, I think commodities exchanges started with the farming markets. Indeed, if you were a consumer of great quantities of grain there was an opportunity to fix either pricing of your major supply by buying a future in the market, or if you were a producer of the grain, you could sell it in future and produce it as you go.
Closer personal experience has been with mining companies who have, from time to time, sold their product forward. That is, if you are in the silver-producing business and your operating plan is to produce 10,000 ounces of silver over the next three months, in order to fix the price so you know what is coming in, you can sell futures in the market.
At the same time, if you were on the other side of the transaction and you were a consumer of silver, you can do the same thing. If you were taking on orders and you want to fix the price of your major commodity in the supply, you would buy futures and thereby fix the price for a foreseeable future to match up with the orders you are taking on the other side.
It has two aspects in truth, I think. One is a very secure service in providing an ability to hedge so that people are not at risk in the commodity transactions they are undertaking, and yes, on the other side of it, if one moves into it one can be a speculator and simply move in, which may help the liquidity of the market. But certainly the basic function would be to provide a hedging opportunity.
Mr Chiarelli: Who are the common buyers and sellers of futures in Ontario?
Mr Walker: The futures we are dealing with here in silver would certainly be people who are in the producing business. When you ask who the common buyers and sellers are I do not know the answer to the question, in truth. That is, if you were to try to determine which are the --
Mr Chiarelli: I will tell you basically what I am looking at. To what extent are individual consumers involved in the futures market, as some individual consumers are involved in the Toronto Stock Exchange, for example, buying and selling shares? How many individual lawyers, dentists, doctors, etc, are going to their brokers to buy and sell futures? Do you have any sense as to to what extent there is that much involvement?
Mr Walker: I have no information on that, I am sorry. I cannot even venture a comment as to what proportion of the market that might be.
Mr Chiarelli: Do you have any sense of whether there are sufficient enforcement regulations to protect consumers and the public in the trade of futures?
Mr Walker: The protection that is there is in the fairness of the market. If an individual chooses to use the market to invest or speculate, there is no reason I am aware of to prevent the individual from doing that. The safeguard that is looked for is to be sure that if you were on the other side nobody is going to leave you hanging with an inability to complete a transaction.
The safeguard that is there is in the terms of margin. If somebody wishes to take a position, you have to put up some serious money and you put up the money in order to protect that position. But you are really protecting the position of the people on the other side. You cannot simply trade in futures without investing some money upfront, but that is to secure the other side so that you do not enter into a transaction which you are unable to complete.
Mr McLean: Futures is something that you can make money at and you can lose money at.
Mr Walker: Yes.
Mr McLean: I just congratulate you for offering your services for this position. You are to be commended for that and I wish you well.
Mr Walker: Thank you very much.
The Chair: Thank you very much, Mr Walker, for appearing before the committee, and good luck with your new responsibilities.
Now we come to the point where we can either have a motion to concur with the appointments on an individual basis or take both appointments, or we can, at the request of one member, defer for one week. What is the wish of the committee? Do we wish to deal with these appointments this morning? No problem with one motion? Can I have a motion?
Mr Wiseman moves that we concur with the appointments of Mr Dewar and Mr Walker. Any discussion on the motion?
Mr Wiseman: I would have loved to have talked to Mr Walker for another hour and a half, because he has a lot of information.
Motion agreed to.
SUBCOMMITTEE REPORT
The Chair: The next item of business is the subcommittee report. There are a few possible complications that have arisen. As you are probably aware, the swearing-in of the new Lieutenant Governor takes place next Wednesday. I think all three caucuses have been asked to sit in on the ceremony. That is going to create some difficulty, but apparently one of the --
Mr Grandmaître: Does this mean the Lieutenant Governor waits?
The Chair: I do not think so, not for us. Maybe for you personally. One of the intended appointees for review -- I turn to the clerk -- the second one, to the Ontario Securities Commission, Ionne Stromberg, has indicated that she cannot attend on this date.
What I am going to suggest is that if we can arrange it we ask Wendy Spottiswood, who is the selection of the government party, although that is going to create some difficulties too. That is a one-hour review. We are dealing with moving Spottiswood up but that is still going to create some problems because she is a one-hour review.
Mr Wiseman: How can you do that? You did not finish your thought on the December 11. I understand the Lieutenant Governor is being sworn in at 11 o'clock.
The Chair: At 11 o'clock.
Mr Wiseman: Which would necessitate only a half-hour from 10:30 and then the cancellation of the rest of the morning.
The Chair: Yes, but what I am looking for is direction from the committee in respect to Wendy Spottiswood, specifically from your caucus. You have asked for a one-hour review. We could move her up to 10 o'clock but we would only have a half an hour rather than the hour requested.
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Mr Wiseman: I do not know. There are a number of questions --
The Chair: Or we could try and delay her.
Mr Wiseman: To bring her all the way in from Kenora for a half-hour review --
The Chair: Yes.
Mr Wiseman: I felt it would be important to review Ms Spottiswood given that we, as a caucus, have asked for a review of the Ontario Northland Transportation Commission as part of our agency review and felt that it would be worthwhile having the recommended chair -- I think she is going to be the recommended chair -- come before the committee prior to the review.
Mr McLean: She lives in the north? Does the Northland cover that area?
Mr Waters: You have to remember that it is more than just a train.
Mr McLean: It is the buses.
Mr Waters: And the planes.
Mr McLean: They have just bought Gray Coach for $7 million.
Mr Wiseman: Our committee is prepared to waive the review of Spottiswood given that we will be reviewing the entire agency later on.
The Chair: We have to waive Stromberg as well because she is going to be out of the country until December 20, I am advised.
Mr Wiseman: We do not have any difficulty with that.
The Chair: What we are going to be doing next week then is simply the Ledgister review and then we will break for the swearing-in of the Lieutenant Governor.
Mr McLean: We will not be coming back after the break?
The Chair: We do not have a subcommittee meeting scheduled today. I am just wondering if we can have a quick subcommittee meeting after the adjournment of this meeting to review the order-in-council appointments and try to firm up the schedule for the following week.
Mr Wiseman: I have a meeting at 12 o'clock. I would have to be done so that I can get to the meeting. It would take me about five or 10 minutes to get there.
The Chair: Hopefully we can start the meeting at around 10 to 12. Are we in agreement with the subcommittee report as altered? Agreed.
We will move on to the next matter on the agenda. That is the closed session review of the draft report. We had a division here in respect of whether we should go into closed session. There was some discussion about this, Mr Grandmaître. I do not know if Mr McLean was present. Mr Wiseman felt we should go in camera for discussion of the draft report. If we still have that difference of opinion, we are going to have to have a motion to move in camera. What is the feeling of the committee?
Mr Grandmaître: My personal feeling is that we should not go in camera.
The Chair: Mr McLean, how do you feel?
Mr McLean: I feel the same way. I see no reason to go in camera.
The Chair: Okay. Can I have an opinion expressed by the government party?
Mr Wiseman: We do not think it is a problem.
The Chair: Okay, this will be dealing with the draft report on TVOntario and on the Eastern Ontario Development Corp. Perhaps we can deal with EODC first. It is probably the easiest one. Everyone has the draft report before them. We will ask David to lead off and then we will open it up for discussion.
EASTERN ONTARIO DEVELOPMENT CORP
Mr Pond: The new language I was requested to draft at the last meeting at which we discussed these two agencies is indicated in shaded ink. Regarding the Eastern Ontario Development Corp, that appears on pages 31 and 32. As I say, it is in shaded ink so it is easy to pick out. The non-shaded parts have been approved already.
Mr McLean: I see the additions that have been made and I find them in order. I do not see anything wrong with them. I think they are good. The tourism designation has been included in there and I think that is right and proper. The people should be informed when their application clears the approval process, so I think the legislative assistant has done a good job. I accept it.
Ms Carter: I would like some clarification of page 32 where it is dividing it into two sections. Is this going to be two totally independent bodies so that we now have four things instead of three in total? And where would the headquarters be and how would this work?
Mr Pond: If you recall at the last meeting, the original draft language arising out of the original in camera discussion was that the Eastern Ontario Development Corp should be restricted to operating within the jurisdictions set out in the statute. The whole issue is of course that the EODC has sort of expanded.
At the last meeting on November 6 this language here was recommended by the members as the compromise, that the EODC stay within its expanded jurisdiction -- so we are not going to interfere with its expanded jurisdiction -- but that it split up, within its expanded jurisdiction, into two branches. The concern was that, for the members who are from what is historically known as eastern Ontario, the corporation not neglect them in its expansion westwards towards the GTA. So this is the compromise.
Ms Carter: Where will the boundaries of central/eastern go to? Will they include the Durhams and Oshawa, or where are we at with this?
Mr Pond: That is up to you, obviously, but the suggestion was that Peterborough be the boundary.
Ms Carter: Yes, that is clear. But I am just wondering how the rest of it works.
Mr Pond: That is up to you.
Mr Grandmaître: I think we should be -- by the way, Jenny, that was a very good question, because as I pointed out some weeks ago, anything east of Bay Street was considered eastern Ontario. It should be better defined. I suggested that we use the Ministry of Municipal Affairs' definition of eastern Ontario, and that is, eastern Ontario would start at Hastings or would include the riding of Hastings east to Renfrew, if I am not mistaken. Other ministries are using that definition of eastern Ontario so I think we should have one definition.
Ms Carter: This is what we said before, but we have not gotten to that point, have we? We have not worked on that so that we have an agreed definition.
Mr Grandmaître: I suggest that we use the Ministry of Municipal Affairs' definition of eastern Ontario boundaries.
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The Chair: Are you suggesting that as an amendment to the draft report?
Mr Grandmaître: If need be, yes.
The Chair: So I would look at that as the final recommendation, where David has said the government should consider introducing a uniform definition of eastern Ontario.
Mr Grandmaître: Which all ministries would be required to adopt.
The Chair: We could be more specific and say the government should adopt the Ministry of Municipal Affairs' definition of eastern Ontario, because this should apply to all ministries of government.
Mr Grandmaître: That is right, because they use it for grants and so on and so forth and also for programs. All ministries should be using --
Ms Carter: Now we have this new thing, central eastern Ontario, and we said Peterborough is the dividing line between eastern and central eastern, but how far west does central eastern go?
The Chair: This sort of muddies the waters. I wonder if we should simply express our concern about the definition, that when we are talking about a uniform definition, it should apply to all ministries and agencies of the government. That would impact on EODC as well as all other agencies of government. Rather than trying to say central, eastern and -- as you say, we are kind of muddying the waters.
Ms Carter: But if you have gone into a category called central eastern, you would expect it to go further west than something called eastern Ontario, even if you had agreed on what that was. You see my point?
The Chair: My point is that perhaps we should consider just pulling that out of there altogether and simply expressing the concern that came up during the hearings about the definition and then make the final recommendation as suggested by Mr Grandmaître.
Mr Waters: Can you read that recommendation back again? What they are talking about?
Mr Grandmaître: Municipal Affairs has its own special definition of eastern Ontario, northern Ontario and central Ontario when it comes to municipal grants.
Mr Waters: Gee, there is one for central Ontario? I have got to find that one.
Mr Grandmaître: There must be a central Ontario if there is a south and an east. We should be using the definition of Municipal Affairs because it uses that definition when it comes to grants and programs, and it is good. If I am not mistaken, the Ministry of Consumer and Commercial Relations is using it as well. But it is not universal, if I can use the word universal. Other ministries have different definitions of eastern and northern Ontario. For instance, at times Renfrew is considered northern Ontario when it came to some subsidies or special grants from the Ministry of Municipal Affairs or Culture and Communications. We should be using one definition and I think Municipal Affairs has the right definition of eastern Ontario and central and northern and western Ontario. That is my recommendation.
Mr Wiseman: I might concur to take that one shaded section out and just leave "the committee should consider introducing a uniform definition of eastern Ontario" without suggesting anything specific. Whatever definition comes up from the interministerial consultation -- they may want to redraw all the boundaries and find what it is exactly they would like to see.
Mr Grandmaître: I agree to that suggestion except that I would like to see it back to this committee. If we are not going to use Municipal Affairs, we will be using another definition. I would like to see that final definition.
Mr Wiseman: We are making a recommendation that we would have to be apprised of any changes. I would not want to just go ahead and say that we should have the Municipal Affairs definition there without knowing exactly what it is.
Mr Grandmaître: Agreed, but if there is another definition, I would like to see it before it is accepted.
Mr Wiseman: You mean if the government decides to create an interministerial committee to define it, then it should be discussed.
Mr Grandmaître: That is right.
Mr Wiseman: I have no problem with that.
Mr Marchese: Is it possible to get, from all the ministries, the different definitions they use of regions, with a history of why they have used a certain definition of regions? That would allow us to get a better sense of what differences there are, why historically, and then this committee could make a more intelligent recommendation on all that. Otherwise where do you send it to as opposed to directing this to a particular ministry or adopting a particular definition from one ministry?
If we are convinced that every ministry perhaps uses different boundaries, it would be useful to get that. For David Pond of course it would be some work, naturally, but I think it would be better for us as a committee to make a wiser recommendation on this.
The Chair: I think we should be doing that separately if it is a concern of the committee, and perhaps directing it to Management Board. This is simply going to one ministry. If we have concerns about that issue, about uniformity of definition of regions of the province, perhaps we should convey in a separate letter those concerns to Management Board and say that we believe this is simply what the government should be looking at and should be moving on. We could ask them for a response and get back to the committee in respect of what they are doing, what they see happening in the future.
Ms Carter: Mind you, I think there is a particular logic to the definition when we are looking at EODC as an issue rather than just a general definition which is, where does the area of prosperity cease? And where do we get into the rather underprivileged area which is eastern Ontario, except of course for Ottawa? Peterborough does come into that category because it is an area of high unemployment and lower per capita income, and of course as you go east and north from there it gets even worse. But if you are looking at it from that point of view, from the need for development, then I would say it does fall into it.
The Chair: I raised this initially, and I think my concern was not questioning the need in particular areas but the fact that Mr Grandmaître said, "Where does eastern Ontario begin and end?" The fact that it has gone up into the Durhams is just for purely political reasons, decisions made by a Conservative government, as a matter of fact. It just does not make any sense.
I think as a committee we should recognize it and say this is something that perhaps should be changed. But it should be applicable right across government because there are so many inconsistencies in terms of definition.
Ms Carter: My own feeling would be that the line should be drawn just west of Peterborough but, as I say, for economic reasons.
Mr Waters: When you go to the last page, if you were to eliminate the shaded-in recommendation and then just use the very last paragraph on that page, it is once again stating that there has to be a definition of eastern Ontario. I recognize that, because in my area, in the north, we are in a situation where sometimes we are covered and sometimes we are not. It just depends on what ministry.
Mr Wiseman: That is okay. Durham is not covered at all in anything.
The Chair: So we have agreement I think in respect to deleting that shaded-in recommendation, and David simply combining what is above that and below that with the final recommendation. Separate from that, we will write a letter to Management Board expressing our concern about the lack of a consistent definition across government.
Mr Pond: So the last paragraph in black as written is okay?
The Chair: No.
Mr Pond: We are not going to mention the Ministry of Municipal Affairs?
The Chair: No.
Mr Pond: Okay.
The Chair: Could we have a motion adopting this report? Moved by Mr Grandmaître. We do not need a seconder. Any discussion? All in favour?
Motion agreed to.
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TVONTARIO
The Chair: We will move on to the second one, TVOntario. David, lead off.
Mr Pond: This is slightly more problematic. The shaded bits begin on page 12. While you are reading that, I will just sort of summarize what has happened here.
The first shaded paragraph on page 12: "The committee recognizes the positive contribution TVOntario makes to the province, and appreciates that the authority is a world pioneer in educational television. However, the committee is concerned about the instances of excessive spending and sloppy management practices uncovered by the Provincial Auditor."
If you recall, we stuck that in because some members pointed out that because the thrust of the recommendations was basically critical, it was important to have some kind of introductory paragraph to put the criticism in perspective, so that the reader who maybe was not as familiar with TVOntario as the committee is would recognize that the committee here was not trying to dump TVO overboard, but just targeting specific criticisms. That is very simply why that paragraph is there.
The next shaded bit is at the bottom of page 13 and all of 14. This is simpler than it looks. At the last meeting, the committee agreed to the recommendation that TVOntario be made subject to the Freedom of Information and Protection of Privacy Act. At the same time, the members wanted to know why it was that some agencies of the government of Ontario are exempted from the FOI act and some are not.
I was asked to go away and look this up. That simply is what you see on page 14, the history of why in 1987 the government of Ontario decided to exempt some agencies from FOI and keep other agencies in. As I say, the rationale by the Attorney General in 1987, Ian Scott, was that some agencies were more directly under the control of the cabinet than others and that really only the agencies which were under the direct control of cabinet should be subjected to FOI. That was the rationale in 1986 and 1987.
Where it gets trickier is at the top of page 15. As you know, right now the standing committee on the Legislative Assembly is completing its very, very extensive and comprehensive review of the FOI statute, which it was obligated to do when the law was passed in 1987. I probably should not be saying this on the record, but I am told that committee is very actively considering recommending that the exemptions for some agencies be lifted and that all agencies of the government of Ontario be brought into the act.
I guess in a de facto way I am sort of leaking what is happening in another committee, but that is what I am told. That committee is reporting its recommendations to the House in the middle of December. This is why the little section here on page 15 is in italics and not in regular print. I put the query, does the committee want to back up the other committee which is looking at this and endorse what looks like it will recommend, namely, that all agencies be brought into the statute? That is why that is there.
You will note I have not done anything about La Chaîne, which was the major item of discussion the last time the committee looked at this report. If you recall, after the last meeting I was instructed to get hold of TVO and find out how much money it spends on French-language programming. If you recall, when Mr Ostry was before the committee in August, he said that approximately 30% to 35% of TVO's resources go into French-language programming. I did get some numbers from TVO. I sent them to you in a memo dated November 27. It is pretty darned obvious, if you believe the numbers, that TVO spent nothing near 30% to 35% of its resources on La Chaîne.
There is a catch. A day or two ago, TVO phoned me up and said there may be a problem here. The numbers they have sent you are not the complete figures for everything they spent on French-language programming, not La Chaîne, but French-language programming. I said: "Mr Ostry said you people spend 30% to 35% of your resources on French-language programming in toto. Is that accurate?" The bureaucrats at TVO said: "Yes, that is true; we do. If you add up every single thing we spend on French-language programming across the board, not just on La Chaîne but also the little bit of French-language programming you get on the English-language network, you factor in everything that gets diverted to French-language programming and you've got a ballpark figure of 30% to 35%."
I asked him, "Can you send me numbers that justify this?" They hemmed and hawed and said, "Okay, we'll try to do that." Today is Wednesday; that was Monday afternoon or maybe Tuesday morning. To make a long story short, they do apparently spend 30% to 35% of their resources on French-language programming, but as of today I do not have the figures to prove that. I have left the language as it is because the committee agreed we had to do a bit more work on this.
The Chair: Thanks, David. I think I will open it up for discussion. Mr Marchese.
Mr Marchese: Let's start from the last and work backwards. I was very concerned about that, because I remember we were spending close to $8 million on La Chaîne, and from the figures David provided it is about $10 million.
Interjection: It is $11 million.
Mr Marchese: I think it is a little more than $10 million. I felt what was happening was that Mr Ostry was compounding all the years of support that was given to La Chaîne, which would amount to 30% to 35%. If that was the case, I felt it was very inaccurate and not a very helpful thing to do. If you compounded what the English network gets over the same period, which would be anywhere from $70 million to $80 million a year, then you can see the difference. I felt a bit worried about the statements that were made and the implications members of this committee have drawn and that other people will draw when they read this.
In addition, David points out that in his discussion with some civil servants some administrators of TVO point out that yes, there are additional costs. If we do not get those figures, I suggest we redraft the document that has been printed here to reflect the money La Chaîne is getting and remove those references so that people do not get the wrong impression. On page 15, when Mr Ostry acknowledges La Chaîne now "consumed," is that his word or yours?
Mr Pond: I suspect it was the word used by the questioner.
Mr Marchese: Okay; "30% to 35% of TVOntario's entire budget." This is not accurate and should be removed, or at least if we keep the statement we need to identify in our investigation that this is the money that goes to La Chaîne, so that people have a sense of the reality in the statement that is made.
Similarly, on page 16, "It is concerned, however, that La Chaîne not become a burden on the authority's scarce resources." That worries me. It carries with it such negativity that I think it is irresponsible of us in some way, so I worry about the language that is written there. In that regard I think I have said about enough. I would think that this committee needs to pursue it to see whether the administrators of TVO can provide specific information about how much money goes to French programming, and if they cannot after we give them a time line of sorts, then correct the references that are here.
In relation to other points that are made around TVO, on the whole issue of the positive contribution that you have added on page 12, I think it is useful. We should keep it there and I think what you have done is okay.
The recommendation we have on page 13 says, "TVOntario should be made subject to the terms of the Freedom of Information and Protection of Privacy Act." I originally supported that and I still do. The question David raises then on page 15 is, if one committee recommends that all schedule 2 and 3 agencies be subject to the Freedom of Information and Protection of Privacy Act, I would be tempted to agree with that. It is difficult to say, "Include TVO but don't worry about the others," because by so doing we are doing an individual, case-by-case procedure, which is not entirely a useful procedure.
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My feeling would be that all of them should be included under the Freedom of Information and Protection of Privacy Act, but as I say that, I wonder whether there are any disadvantages of that which we have not looked at. For example, I know the archives people in the Ministry of Culture and Communications have very few resources to deal with this. The more and more we give to them to do, the less and less they have the ability to respond to people who need the information that they are required to respond to.
That is one immediate disadvantage that I see out of all of this. That is not to say that because of that we should not be doing this, but I wondered if David or others have any other reasons that we should be looking at before we make this recommendation. That is a question I throw out to all the members, or to David if he has any other information.
Mr Wiseman: On that comment you just made about resources being allocated to freedom of information can become onerous with freedom of information requests that may or may not be frivolous, we get a number of them in the Ministry of Correctional Services that you wonder about.
The Chair: David, did you want to say something?
Mr Pond: There is no doubt about it; the current operation of the freedom of information act is burdensome on many public servants, whether they are in agencies or on-line ministries. There is no doubt about it. If you talk to people in Management Board, it is burdensome, because they are not getting any extra person-years to handle the requests.
Another one of the recommendations that is being actively considered by the standing committee on the Legislative Assembly is sticking in what it calls a frivolous clause or a nuisance clause whereby, I gather, the officials who implement the act in every ministry would have the authority to basically reject what they deem to be frivolous or nuisance applications. There are such applications; there is no doubt about it.
The Ministry of Correctional Services, Mr Wiseman, is an excellent example. There are people out there who have made public servants' lives miserable with freedom of information. There is no doubt about it. It is a serious problem. Of course you cannot say that publicly, because FOI is a motherhood thing and so on and so forth, but it is true.
As I understand it -- and I think, Mr Waters, you are on that committee -- the Legislative Assembly committee has looked at this globally and there are other recommendations they are probably going to make which are designed to address that particular problem. It is not that they have ignored that problem when considering whether all agencies should be subject to the act.
Mr McLean: Can I say something, Mr Chairman, just on that freedom of information act? I had an instance one time which I would just like to relate to you. Mr Waters will be well aware of the bridge at Webber's Burger King on Highway 11. That bridge is owned privately. I had a constituent who wrote me and wanted to know who was responsible for that facility if it blew over, and was there insurance on it? They wanted to know if there is a study done each year. I wrote a letter to the Ministry of Transportation to find out what information they had, because they have insurance and all that. I had to go through freedom of information to find out whether that structure was insured, whether there was an engineer's study done every two years or what. It seemed dumb to me to have to go through the freedom of information just to find out what the public should be made aware of. To me it goes too far sometimes.
Mr McGuinty: With respect to the first item we have been discussing, I guess, the Freedom of Information and Protection of Privacy Act and whether TVOntario should be made subject to that legislation, on the face of it it seems attractive to do that, and I think if we were to ask the public generally if they think it should be made subject to this kind of legislation, people say yes, and we should know more about the salaries we are paying our people appointed to agencies, boards and commissions and those kinds of things. More knowledge is a good thing. I think that is the general consensus.
Notwithstanding that, I think Rosario made a good point. I would like to hear from people who would argue against this. Rosario raised the point about the burden that is to be placed on the FOI folks to deal with this. There may be others out there who have some objection to it, and I certainly would not want to go so far as to make a recommendation that all agencies, boards and commissions should be made subject to the FOI.
With respect to the recommendation regarding La Chaîne, I just feel there is a lack of information there. I am going to speculate here and say that we are probably paying more -- probably considerably more -- on a per capita basis to fund programming in French. That is one aspect of it.
The other aspect, though, is that although it does not say so in the legislation that set up TVO, it is accomplishing some kind of social policy initiatives. It has taken on that role. I note that the board of directors for 1990 said -- I am reading from page 3 of the notes here prepared by David -- it is going to "support and promote understanding and tolerance by better reflecting the societal diversity of Ontario."
When I compare that with page 2 of the brief prepared by David, in section 3 of the Ontario Educational Communications Authority Act, there is nothing which outlines the objectives of TVO, which is supposed to "promote understanding and tolerance by better reflecting the societal diversity of Ontario." For better or worse, it has taken on that function.
So we are not talking about something here that can be measured merely in terms of dollars and cents. If you want to get into a proper discussion of this, I guess we have to discuss the merits beyond the dollars and cents of operating La Chaîne. My guesstimate is that, measured strictly in terms of dollars and cents, it does not make sense, but I think we are after something that goes beyond that. I think if we are going to properly consider it -- and I am not sure that falls within the ambit of this committee -- we are after something further. Certainly TVO is doing that for that reason; I think it is logical to infer that. Government has not curtailed that activity, and I am certain that people in the know know this is not making sense financially. We do all kinds of things that do not make sense financially, but we are, again, attempting to achieve certain objectives. Some of them are more idealistic than others; nevertheless, I do not think that relieves us of any obligation to attempt to meet those objectives or ideals.
As I say, if we are going to consider this properly, I think we should have a full discussion. Do we think French-language programming is important to this province and, if we do, are we prepared to pay for it? It is as simple as that.
The Chair: Anything else?
Mr Grandmaître: Yes. I agree with Dalton's comments. It is a fait accompli that it is costing more to produce French programs. It is costing TVO or La Chaîne quite a bit of money.
David, on page 15 of your report it states, "The committee recognizes that the decision to establish a separate French-language network was made by cabinet, and not TVOntario." I question that. I do not think it was a dream of cabinet. Any comments on that one?
Mr Pond: Mr Ostry was asked this and he made it quite clear that he was called to a meeting with Mr Masse, who was the federal minister, and the provincial government. He was told there was going to be a press conference, that at the press conference the two governments wanted to make a positive announcement about provincial government support for francophones in Ontario, and that this was what the announcement was going to be. I can get you the Hansard. According to Mr Ostry, that is how La Chaîne got started. That is what he told the committee.
Mr Marchese: It is my recollection that Mr Ostry -- not perhaps in those words, but that it was a political decision made by the government of the day.
Mr Grandmaître: I question that. I think Mr Ostry was one of the responsible persons to establish La Chaîne. There was a lot of pressure on TVO because of the pressures from francophones right across Ontario, but especially from eastern and northern Ontario. Once in a while, maybe two hours a week, francophones would see a French program on TV.
Regarding the second-last recommendation, David, that "TVO should consider whether the viewing needs of French-speaking Ontarians could be met through one network," I do not believe we should go back to one station or one network. I think Franco-Ontarians have worked very hard to create La Chaîne, and I think La Chaîne should be maintained, recognizing that it is costing taxpayers more money to operate La Chaîne than other TVO programming.
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The Chair: How does the committee want to deal with this? Do you want to go through the recommendations individually. Because we are going to have some differences of opinion. I want to speak on this last one, and I will remove myself from the chair. I might as well indicate that there is probably going to be a minority opinion with respect to La Chaîne. I do not know if you want to deal with it today. There is the suggestion from Mr McGuinty that if we want to peruse this matter further, we should perhaps have more information and perhaps even be calling TVO officials before us again to talk about the operation of La Chaîne.
Mr Marchese: I believe we could go through the recommendations today, and there will be other recommendations that will not be dealt with today because we might need further information. I think we can do a lot today if we go through it one by one.
The Chair: Let's start on page 12, the committee recommendations, and the wording, of course, as well.
Mr Wiseman: I would hate to throw a monkey wrench into this, but I have a further recommendation that I would like the committee to consider. That is the relationship of administration costs to the production of programming and a recommendation that administration costs be kept much lower than they seem to be right now, that this money be used for programming and that mechanisms be put into place to insure that administration costs are kept low, because there is a $1.1-million increase in administration in one year.
Mr Marchese: Does the recommendation on page 15 not deal adequately with your concern? I know you are raising a different point, but "Management Board of Cabinet should consider whether TVOntario should be subject to directive 1-1-1, such that funds provided by ministries of the Ontario government on the understanding they will be spent on programming...."
Mr Wiseman: Maybe we will deal with that recommendation when we get there.
The Chair: Let's look at what is on page 12. Are there any problems with what David has prepared on page 12 under "Committee Recommendations"? We are all in agreement with page 12.
Page 13: We are agreeing with the auditor's recommendation.
Mr Marchese: The committee recommends that "TVO should be made subject to the terms of...." Is that the one you are looking at, Mr Chair?
The Chair: No, the top part dealing with the auditor's report, and the committee is concurring with the auditor's report -- the top two paragraphs, talking about administrative practices, etc.
Ms Carter: That is okay -- the feasibility of major projects and all that.
Mr Wiseman: What would be the cost of a comprehensive audit?
Mr Pond: Good question. If it were done by the Provincial Auditor, it would not cost TVO anything.
Mr Wiseman: We could not very well recommend that the Provincial Auditor audit TVOntario every year. Come on.
Mr Pond: Actually, they are, like any other agency that receives public funds, required to have an audit internally every year. That is contingent on getting their budget.
Interjection.
Mr Pond: Well, this is it. Once again, depending on what schedule you are in if you are an agency, that determines whether you do it internally or whether you do it externally.
Mr Wiseman: But all an internal audit does is say where the money was spent and whether it has been accounted for properly. It does not say whether the money has been well spent -- that is what a comprehensive audit would do -- and whether a recommendation here might be in order for, say, a comprehensive audit to be done every five years in order to determine whether the money that is being funded from the province is being spent in the wisest distribution of allocations.
Mr Marchese: But is that something an auditor could do, whether it is comprehensive or not, or are those political decisions that are made?
Mr Wiseman: For example, they would probably recommend that $23,000, or whatever it is, spent on a wall of TVs is probably not good use of money. That came out anyway.
The Chair: Reading this recommendation from the Provincial Auditor, they are suggesting in-depth reviews over the next two or three years should be board-initiated and reporting to the audit committee of the board of directors. Obviously the Provincial Auditor feels that is going to be satisfactory. I do not know if we are qualified at this stage of the game to suggest something more comprehensive.
Mr Wiseman: We are okay with this then.
Mr McGuinty: I would like a point of clarification. In the last three lines of the auditor's statement it says "These reviews should be board-initiated." What does board-initiated mean?
Mr Pond: TVO should do it. It should start the process on its own initiative and not wait for the ministry to do it.
Mr McGuinty: Should we take comfort in knowing that the responsibility for this lies with the guilty party, so to speak?
Mr Pond: I think the guilty parties have retired, have they not?
Mr McGuinty: I am not going that far.
The Chair: I think the board would have some difficulty explaining whether it is called before this committee or called before the standing committee on public accounts in the next couple of years if it had not reacted in a positive way to the Provincial Auditor's recommendation.
Mr Marchese: I thought of the same question Mr McGuinty was raising. The review is conducted and sent to the audit committee, but I think the ministry of course would have access to that and would get it as well, so the ministry would be fully informed. I do not know whether Mr McGuinty thinks that is also in-house, but for me it is not because I think we want to deal with those things. I would feel assured that somehow by the ministry also getting it they would also be dealing with it in a political way.
Mr McGuinty: I am concerned but not so concerned as to -- I will go with the general feeling here. I think that is adequate.
The Chair: The next section deals with the Freedom of Information and Protection of Privacy Act. I guess we have some reservations about this.
Mr Marchese: This is where we had discussion about whether to defer this matter and to gather more information. The question is, what kind of process do we use to gather this information? I would not want lengthy public discussions. I do not know whether David has suggestions. It would be useful to find a way to get feedback both internally and externally on the implications of this: What would the disadvantages be to do this, if any? My concern is that I do not have a sense who we should be consulting, although we have had two people mentioned in this report who I think are professors.
Mr Pond: Yes, two of the so-called experts. Those two chaps are FOI fanatics. The Legislative Assembly has done this all summer and all fall. They are going to be making these kinds of recommendations regardless of what we do. It just occurred to me we might want to piggyback on what we know another committee is going to do anyway. What we could do is leave it out entirely.
Mr Wiseman: What if the other committee recommends that freedom of information not be expanded?
Mr Pond: It will not. I know what it is going to recommend.
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Mr Marchese: In spite of what the other committee is going to recommend, what we are communicating is a sense that it would be useful to know what people are thinking around possible implications or disadvantages, if any. We could leave it out and let another committee make a recommendation, true, but given that we are discussing it, I think we should find a way to pursue it if we can.
The Chair: My only concern is that if another standing committee is looking at this single issue in a comprehensive way it is obviously redundant for us to get involved in it too. I am concerned about that element of it.
Mr Marchese: I see. Are they looking at it comprehensively?
Mr Pond: Yes, they have.
Mr Grandmaître: Yes.
Mr Pond: Mr Grandmaître knows more about this than I do. The deal in 1987 was that whatever misgivings members of the opposition at that time had about the statute, the tradeoff would be that this committee would get this kick at the can three years after the statute passed the Legislature. As I understand it, that is what they have been doing all summer and fall. It is too bad Doug is not here. He is the clerk for that committee as well and he has heard enough about freedom of information to last a lifetime. The draft report is 140 pages long and everything you ever wanted to know about FOI is in there.
Mr Wiseman: Could we include in this section here a reference to that report and that we strongly feel that while the Freedom of Information and Protection of Privacy Act should be expanded to include TVOntario, at this time this committee would bow to the decisions of the other committee with reference to freedom of information?
Mr Grandmaître: I would not go that far.
Mr Pond: The only technical problem is we cannot say anything about that other committee's report until it is official. This is why we have Hansard here. Technically I am leaking to you what another committee is doing. I can be called before the bar at the House now because I am leaking a committee report to you. Apparently they are scheduled to report to the House December 11, which is only a week away. We could not approve this language here today until after that committee has officially reported.
Mr Wiseman: We are not going to approve this document within that time frame anyway. Maybe we can hold off on this section until we see what that committee says, and then we can revisit this with recommendations we can pull from that committee's report.
Mr Pond: That is why I put this in italics.
Mr Wiseman: Maybe we should move along.
The Chair: Do you want to defer that element?
Mr Wiseman: In other words, we are going to need copies of that report.
Mr Pond: Yes.
The Chair: Okay. The next section on page 15 deals with Management Board.
Mr Wiseman: This is where I believe my notion about administrative costs being kept as low as possible and funds being directed to programming be maximized. I think other organizations and groups that receive money have been developing very unique and creative ways of distributing administration responsibilities, with the result that their administration costs are much lower. I would strongly recommend that TVOntario look at reducing its administrative costs by distributing the administrative process in creative ways. I do not know how you can specifically make them do that. If somebody can help me with the words, the intention here is that we are looking at a $1.1-million increase in administrative costs in one year, which represents, if my math is even close to being right, an 18% increase in administrative costs in one year.
Mr Pond: Yes, it was very large.
Mr Wiseman: I have not seen a rationalization for that kind of increase in administrative costs.
The Chair: I wonder if we could not simply express concern about the level of administrative costs as an additional sentence and a lead-up to the recommendation.
Mr Grandmaître: I think you are right, Mr Chairman. This is what we should be doing. I agree with Jim that some programming dollars are being diverted to administration, but the total budget did not increase. There was not a deficit in the programming or the administration. There was an increase in administration, but these dollars were simply diverted, and it is the transfer of these dollars that should be prevented. Maybe they should go back to the minister or the ministry and ask permission to do so.
Mr Wiseman: I agree. What concerns me is the fact that the administration costs are increasing more rapidly than research and development is.
Mr Grandmaître: Or even programming.
Mr Wiseman: The increase in administration costs is greater than the research and development budget for TVOntario, and I have some real concerns about that.
Mr Marchese: I do not know whether that recommendation does not do that. It says they will not be spent on programming; the money spent on programming cannot be diverted to administration. We have seen an increase to administration because money was diverted from programming. One presumes if this proceeds in this way it makes a strong recommendation that not happen. If that does not happen, then we have taken care of the problem.
The Chair: I think the other element is simply the inclusion of a sentence here expressing concern about the appearances in respect to the increase in administrative costs. We do not have enough information before us to know whether they were justified or not justified, but there is a concern being expressed by the committee and that will be drawn to the attention of TVO and the ministry.
Mr Wiseman: I would feel comfortable with adding that sentence and putting in that concern.
Mr Waters: We had some discussions earlier on about La Chaîne and the 30% and 35%. I think we should hold off on that until such time as we get these figures, and if it is like 15% La Chaîne and 15% French-language, spell it out very clearly so that people realize La Chaîne is not the total consumer of 30%. I think we have to make sure everyone is well aware of that. I would like to see that held over till we have those figures.
Mr Wiseman: I think Mr McGuinty was talking about whether there is something we are promoting here that we cannot put a pricetag on. I think it is worthwhile having a paragraph or two about the goals and objectives of La Chaîne française in terms of achieving the quality and type of society for Ontario; some kind of recognition that there may be intrinsic value here that cannot be quantified in dollars and cents. Would that be about what you were saying?
Mr McGuinty: Essentially that is it. I would like to hear from the Chair on this point. I anticipate what he is going to say reflects an opinion held by a good number of people in the province, and we should recognize that.
Some people are of the opinion that we should not release the truth to the people, because when they see this they are going to look at it strictly in terms of dollars and cents and say that is not right. Some people call that subscribing to the theory of political correctness: We should not release statistics regarding crime, for instance, and the correlation between certain racial groups. I do not buy that. I am always for the truth, and we can work with that. We can stand on our podiums when election time comes and live or die by it. It is as simple as that. That is why I think it is very important that we hear from Mr Runciman, because I just heard it from a number of constituents and we should get it on the record and deal with it.
The Vice-Chair: Mr Runciman?
Mr Runciman: I find the recommendations are warranted, especially given the tough economic times we find ourselves in. It only makes sense to me that government should be looking at all areas of expenditure, and I do not think there should be any sacred cows, areas that we can say this is a social policy initiative and despite the cost to the taxpayers this is for the betterment of society as some politician sees it. I think it is time we went back to square one in many of these areas and took a look at the real needs out there and whether they can be met in a more cost-effective way.
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I am not saying there are not needs out there in the French-language community in Ontario. Certainly there are, but I think, as Mr Ostry pointed out -- although Mr Grandmaître has taken issue with this -- this decision was not a social policy initiative; essentially it was a political initiative. I think we should be going back and taking a look at what are the real needs of the Franco-Ontarians in terms of this sort of service, and can they be met through one network?
The testimony before us showed that there was a target audience, a potential audience, of 180,000 viewers a week, and they have indicated that they are watching for an average of two and a half hours only on this network. Obviously, as Mr McGuinty said, this does not make much financial sense, and if they are only watching for two and a half hours -- we never discontinued the service provisions on the English-language network for French-language residents. Those were never discontinued, and perhaps they could even be expanded upon and the real needs out there -- not the political needs of any given political party, but the real needs of Franco-Ontarians -- could be met through the service of one network.
I am saying, "Let's get real, folks." We are talking about taxpayers' dollars, and times are tough indeed. I do not see why anyone who is representing constituents of this province, people who are paying taxes, should take offence at these kinds of recommendations. What we are saying here is: "Let's take a look. Can the real needs be met through one network rather than two?" It is costing us in the neighbourhood of $27 to $32 million, French-language service provision right now -- perhaps not just the one network, I agree -- for a target audience of 180,000 watching for two and a half hours a week.
The other element of this which ties in very neatly in my view is the cost-benefit analysis. Simply because this has some political ramifications, does that mean we do not want to take a look at it, we do not want to hear the message? Effectively that is what you are saying. You are afraid or nervous or concerned about someone coming back and saying: "Folks, this doesn't make any sense whatsoever. We've done a very comprehensive cost-benefit analysis and this is nuts. You should never have gotten into it. This kind of decision should never have been taken," which Mr Ostry implied, so let's hear about it. What you are suggesting to me and what I have heard in previous discussion in respect to this is, "No, we don't want to hear those messages and we don't want the people of Ontario to hear those messages."
I am agin that, folks, and I am saying right now that I am going to have some difficulties as Chair of this committee in how we arrange this, but I am certainly going to express a minority opinion on this, because I think, especially given the tough economic times, if you look at the expenditure of $32 million -- we do not know how much of that is going to La Chaîne specifically because of diversions, etc, but take a look at what is happening with the OPP, for example. We are having serious cutbacks in the provision of policing services across this province. Even a third of those dollars directed towards policing services would alleviate a crisis in policing this province.
What is a real need out there and what is not a real need? Those are the kinds of questions we should all be asking ourselves as elected representatives.
Ms Carter: I would like to disagree with that, and I am worried about targeting La Chaîne in this way. In fact, I would be inclined to think we should delete everything after the heavy type on page 15, which is what we were just looking at.
I would be interested to know how many hours per week the viewers of the English network watch TVOntario. I think if we started really comparing these two things on a level playing field, we might come to some different conclusions. I certainly think what we have got at the moment does leave a very anti-francophone impression, which I would certainly not wish to have any part in.
Mr Pond: The middle of page 6 gives those comparative numbers. That comes from TVO. Those numbers are derived from the documents sent to us by TVO. Just to quote, "Over two million Ontarians watched English-language programming per week" -- in 1989-90 -- "and about 180,000 French-language programming." Then when Mr Ostry appeared before the committee he was asked about this and that is when he gave the figure of 2.5 hours.
Ms Carter: Do we have that figure for the English network?
Mr Pond: Per week? We can get it.
Ms Carter: Also, when Mr Runciman compares this with expenditure on the police force, it seems to me that the police have to deal with society's mistakes. It is in a sense a negative expenditure. Obviously we have to have it, but the more we fail in other respects in our society, the more we have to pay police to deal with the problems that arise, whereas I think expenditure on TVOntario, and particularly on La Chaîne, is the kind of expenditure that can have a positive effect in making this a better society where we are less likely to have people who go out and commit criminal acts, hopefully.
Mr Marchese: I do not want to appear to be disagreeing with the comments the Chair was making around doing reviews for cost-effectiveness of programs, because if we present it that way, then it will appear that is what we are fighting against. The problem I have is what has been said on page 15 at the bottom and the implications and the negative implications it has, given the possible inaccuracy of those statements and the subjective remarks on page 16 as well. That leads me to the recommendation, which I find problematic.
Why would we not do a cost analysis of the English network to see whether that is producing the kinds of results we want based on our needs? Why do we focus only on La Chaîne and French-speaking people and their needs? If you separate them, it creates a problem, as it did for me. That is why I have a problem with your interest in doing a cost analysis simply of La Chaîne. If you had said, "Let's do a cost analysis of the whole thing," then I would have an easier time with that, because we should be doing cost analysis of a lot of things.
If you wanted to reconsider that, I think we could or should. If you want to defer this item until we get a little more information from TVO around those facts and figures, I think that might be useful and we might come back and reconsider this issue based on the discussion we have had today and the figures we might get another day and reconsider that whole matter then.
The Chair: I think that seems to be the consensus, that we try to get additional information. It may be helpful too if we can call in the finance person for TVO, who can talk about specific dollar amounts and transfers and those kinds of things, to give us more information on really what is happening over there.
Mr Grandmaître: One short comment before we break up. I want to make it very clear that, as Rosario pointed out, we should be looking at cost-effectiveness. This is the reason why we are looking at TVO. I think we all appreciate the services provided by TVO and La Chaîne, but at the same time, they must be fiscally responsible in delivering these services; I totally agree with him.
When you look at those figures being provided -- I forget on what page -- 180,000 francophones watched TV and two million Ontarians watched English-language programming per week. Do not forget, there are only 450,000 of us. I think that is very good if 180,000 are watching it. When you consider the population of Ontario at 9.5 million and only 2 million Ontarians watch English TV, that is a very poor average.
The Chair: My recollection in respect to why La Chaîne was singled out versus the English-language network was Mr Ostry's testimony that it was chewing up 30% to 35% of the budget.
Mr Grandmaître: You are absolutely right. I do not mind looking at the cost-effectiveness or the budget of TVO and how it spends its dollars. I am willing to go along with the committee and let's look at their cost-effectiveness.
Mr Pond: Just to clarify, the committee is deciding to call back somebody from TVO to the committee to talk about this?
Mr Wiseman: A financial person, somebody who can give us information about what programs are the most popular and the number of hours of watching. I tell you, at 6 o'clock in my house, with kids under the age of six, Polka Dot Door is the number one program. I would also suggest that there are other shows that are equally as popular.
Mr Marchese: I have a difficulty that if we get an individual to come and tell us certain things and he or she tells us he cannot answer the question, that may not be too helpful. I am assuming they will come prepared.
Mr Pond: They will come with an entourage. They will not send one person.
Mr Waters: The one thing I would want to make sure is that they are willing to honestly state -- if you closed down La Chaîne and continued French-language programming on TVOntario, what is going to be the cost saving? I do not see any, with the exception of a few jobs, because you are still going to provide French-language programming.
The Chair: Rather than get into that now, it is after noon hour and we like to have a subcommittee meeting over the lunch hour.
Mr Wiseman: In the binder of TVOntario information we received, I do not recall, but are some of these questions answered?
Mr Pond: No.
Mr Wiseman: Then could we actually have them prepare something and send it to us in advance of them coming before the committee?
Mr Pond: I will talk to them. I am sure the clerk will too.
The Chair: Meeting adjourned.
The committee adjourned at 1202.