INTENDED
APPOINTMENTS
JOHN LOWRY
CONTENTS
Wednesday 12 June 1996
Committee business
Intended appointments
John Lowry
Thomas Reid
Louis Veilleux
Subcommittee report
STANDING COMMITTEE ON GOVERNMENT AGENCIES
Chair / Président: Laughren, Floyd (Nickel Belt ND)
Vice-Chair / Vice-Président: Martin, Tony (Sault Ste Marie ND)
Bartolucci, Rick (Sudbury L)
*Crozier, Bruce (Essex South / -Sud L)
*Doyle, Ed (Wentworth East / -Est PC)
*Ford, Douglas B. (Etobicoke-Humber PC)
*Fox, Gary (Prince Edward-Lennox-South Hastings / Prince Edward-Lennox-Hastings-Sud PC)
*Gravelle, Michael (Port Arthur L)
Johnson, Bert (Perth PC)
*Kormos, Peter (Welland-Thorold ND)
Laughren, Floyd (Nickel Belt ND)
*Leadston, Gary L. (Kitchener-Wilmot PC)
*Martin, Tony (Sault Ste Marie ND)
*Newman, Dan (Scarborough Centre / -Centre PC)
*Preston, Peter L. (Brant-Haldimand PC)
*Wood, Bob (London South / -Sud PC)
*In attendance / présents
Substitutions present / Membres remplaçants présents:
Pupatello, Sandra (Windsor-Sandwich L) for Mr Bartolucci
Clerk / Greffière: Tannis Manikel
Staff / Personnel: David Pond, research officer, Legislative Research Service
A-353
The committee met at 1008 in room 228.
COMMITTEE BUSINESS
The Acting Chair (Mr Peter Kormos): With the consent of the committee, for the purpose of item 1 on the agenda I will chair. I ask the committee to note that it's been years since the whip in my caucus has permitted me to chair or vice-chair or in any other way participate in the process at this level. Of course, this is a whip who is a team player and inclusive. I appreciate the committee's approval. In any event, we're resuming the debate on Mr Wood's motion.
Mr Bob Wood (London South): I would like to speak to a point of order, Mr Chair. I'm sure your elevation today is a very positive sign for events in a few days' time. I think you can take this as a very encouraging sign of increasing support.
I would like to withdraw the motion I have on the floor. I am prepared to move, once this motion is indeed withdrawn, that the Chair present the report to the House and move the adoption of the recommendations. If I don't get the opportunity to do that, hopefully somebody else will and we can dispose of the matter.
The Acting Chair: That's the new motion on the floor. Any debate with respect to that motion?
Mr Tony Martin (Sault Ste Marie): I appreciate the acquiescence of the government side on this. It is indeed a very important subject, one that requires some debate at the highest of levels, because as I've shared in closed session, transportation is fundamental and essential to any future we will have in the north and enhancement of transportation has always been the order of the day for governments at Queen's Park where it concerned the north. I hope this government would do everything in its power to make sure that continues to be the case.
The Acting Chair: Thank you, Mr Martin, for expressing your support for the motion. Is there any further debate on the motion?
Mr Bob Wood: Yes. I would like to draw to the attention of the committee that it's as a result of hearing good submissions from all sides of the committee that we've come to this conclusion.
The Acting Chair: Thank you, sir. Any further debate? I call the question. All in favour of the motion? All opposed? Motion carried.
Mr Peter L. Preston (Brant-Haldimand): I find it very difficult to keep a straight face when Mr Kormos is trying to cut you off for being too longwinded.
The Vice-Chair (Mr Tony Martin): I obviously wasn't being obnoxious enough, maybe. Was that it?
Mr Bob Wood: That's a precedent I hope the Vice-Chair is going to follow throughout the session this morning.
The Vice-Chair: That's what happens when everybody becomes cooperative, eh?
INTENDED APPOINTMENTS
JOHN LOWRY
Review of intended appointment, selected by third party: John Lowry, intended appointee as member, Ryerson Polytechnic University board of governors.
The Vice-Chair: We will move to the interview of Mr John Lowry. Are you going to have a few opening comments for us?
Mr John Lowry: No, I'm not, Mr Chair, but thank you for your kind comments. I'd be pleased to respond to any questions the members may have.
The Vice-Chair: We welcome you and we will start the questioning with the government side.
Mr Douglas B. Ford (Etobicoke-Humber): Good morning, Mr Lowry. Thank you for coming today. I look at your extensive background in the banking business. It's a great bank; I know all about it, believe me.
What professional experience will you be able to offer the board as an intended appointee?
Mr Lowry: I bring 38 years of banking experience to the board. That in itself doesn't mean a whole lot, but over the years I've had an opportunity to work with a lot of our customers, big and small business. I've learned a lot from them as well. During the 38 years I've also had an opportunity to run some major parts of the bank. Today, I have responsibility for our branch network across Canada and in the Caribbean and responsibility for all of our personal and small business customers in Canada.
Mr Ford: Yes, I see that background is quite extensive. It's an honour to have you on this board. Why would you choose to accept a board position at Ryerson as opposed to another educational institution's board?
Mr Lowry: I've had a long association with Ryerson. We have been the bankers of Ryerson for many years. I personally was the relationship manager for Ryerson some years back, so I know many of the people from Ryerson. I was also in charge of the capital fund-raising program back in 1989 and headed up the financial institution fund-raising campaign.
Mr Dan Newman (Scarborough Centre): Good morning, Mr Lowry, and thank you for appearing before the government agencies committee today. Are you familiar with the concept of income-contingent loans?
Mr Lowry: Yes, I am.
Mr Newman: What are your thoughts on them?
Mr Lowry: I think the program has some merit. Certainly, it's based on your earnings when you graduate; the more you earn, the quicker you have to pay back your loan. I think that's fair. There has been a lot of resistance from the student body, the Ontario Federation of Students, towards the program. I think they see it as a way the universities will move to increase the tuition fees, so we also have to be very sensitive to their concerns and listen to what they have to say as well, but I feel the program does have some merit. It's worth exploring and considering.
Mr Gary L. Leadston (Kitchener-Wilmot): How would you envision your role on the board? There are some parallels with your background, but in terms of the future how would you envision your role on that board?
Mr Lowry: The way the university is structured, the board of governors really has responsibility for finance and administration and the academic council has responsibility for the academic program. I see working very closely in helping with the finances and the administration of the university, but also it has to be very collaborative. It needs the support. All parties have to work closely together. There are some real challenges, as you well know, in the education field these days, so it's important that all parts work closely together.
Mr Ed Doyle (Wentworth East): I wonder if you can tell us about the remuneration for this part-time position.
Mr Lowry: I'm pleased to report that there's no remuneration. It is a community volunteer program and I'm pleased to be part of that.
Mr Bob Wood: Mr Chair, we'll reserve the balance of our time.
The Vice-Chair: You've got probably a good seven minutes to use at the end of this round if you so choose. We'll move to the Liberal Party for 10 minutes of questioning.
Mr Michael Gravelle (Port Arthur): Good morning, Mr Lowry, and welcome. Ryerson specifically, like all universities and colleges, has received a substantial funding cut in terms of provincial funding. It's $10 million for 1996-97, which is 7% of what it was receiving previously. Obviously tuition fees have gone up and funding's gone down. You seem eminently qualified for the position. Do you expect that part of the role you may play in this is in some way also connected with fund-raising? I must admit I'm thinking in terms of your association with CIBC, which is very supportive. As you say, they're the banker for Ryerson. Is that going to be one aspect of your role?
Mr Lowry: They haven't quite carved that out for me yet but I suspect that, having been on many fund-raising campaigns over the years and associated with many different charities, they will be looking for me to play a major role in that area. I'm certainly prepared to do that.
Mr Gravelle: Do you have any ideas that you'd be willing to share with us in terms of how that can be done? Because even beyond Ryerson it's going to be a problem for all post-secondary institutions. They're all looking for ideas and concepts of how more money can be raised in that manner. I'm curious whether you have any ideas you might want to share with us.
Mr Lowry: It's important that we have a very strong educational system. If we look at Ryerson, Ryerson also has an excellent business program, and that's very important to all the financial institutions, particularly here in Toronto, including CIBC in that. We are a major employer of Ryerson graduates and there is a lot more we can do in working cooperatively together in the private sector and the public sector in trying to share some programs and bring the expertise we have from both business and education together in some of those programs and reduce costs. For example, Ryerson does have some long-term debt. That's going to be a challenge to deal with, but that may be an opportunity, that we can do some fund-raising around that as well.
Mr Gravelle: In terms of the 1996-97 cut, and of course there have been previous funding reductions, are you aware of what that has meant to Ryerson in terms of how it's going to operate next year?
Mr Lowry: I have had some discussions with Dr Lajeunesse on that, and the $10-million cut in the provincial grant really is going to create some challenges. But I can assure you, in talking with them and the other people from Ryerson, that they feel they are up to the challenge. They have a number of programs where they have outlined how they're going to deal with that $10-million cut. It comes anywhere from energy conservation -- retrofits -- to downsizing, working with the unions, early retirements. There is a whole plan of action that I'm glad to see Ryerson has already put before its board. They're fiscally responsible and they have the issues well in hand. It's not easy, but they're up to it.
Mr Gravelle: I take it from what you're saying that you believe the cut can be managed without a reduction in the standards for which Ryerson is notable. I presume you believe that's possible. That's one of the concerns those of us in opposition have, and I'm sure members of the government as well, that these funding cuts are having such a substantial impact, let alone the increased tuition fees which are making university and college potentially less accessible for people.
Mr Lowry: Your comments are very valid, and I can assure you that we will look under every rock to make sure we're getting value for every dollar we spend at Ryerson.
Mr Bruce Crozier (Essex South): Good morning, Mr Lowry. I want to discuss for a moment or two the fund-raising aspect. With the significant reduction in funds available from the government for all universities -- and this has been a problem throughout the 1980s and 1990s, has been a complaint as it's declined -- fund-raising, as you said, will be an activity that will have to be pursued. If we consider that taxation is really a redistribution of wealth for the benefit of society as a whole, I wonder if you'd comment on the fact that when we rely more on voluntary contributions, perhaps those in society who could well afford it still may not participate, will choose not to give money to organizations such as Ryerson. Do you see fund-raising as better, as worse, or do you have any comment on it compared to funding by society as a whole?
1020
Mr Lowry: That's a very good point and good question, and I wish I had the answer off the top of my head, Mr Crozier, but I don't. My view is that we're going to have to help, whether it's hospitals, universities, whatever the case may be. I think we all have an obligation to dig a little deeper to help these very important institutions in our great country.
The banks are doing extremely well right now; we're in that part of the cycle where bank profits are doing quite well. I can assure you that as a corporation we're also looking at our donation policy and we're also trying to dig a lot deeper into helping our institutions in Canada and in Ontario.
Mr Crozier: If you ever do find out that answer, perhaps you'll share it with the committee.
Mr Lowry: I certainly will.
Mrs Sandra Pupatello (Windsor-Sandwich): Good morning, Mr Lowry. I have one question. I'm just looking for your opinion on the privatization of universities. Do you agree with that policy?
Mr Lowry: I wish, again, that I had a lot more expertise in the privatization matter. Unfortunately, I'm not an expert on that, but my sense would be that I wouldn't want to see wholesale privatization of our educational system in Canada. I would need to do a lot more research and have that opportunity to come back to you with a much better response.
The Vice-Chair: We'll move on to the New Democrat caucus and Mr Kormos.
Mr Peter Kormos (Welland-Thorold): Mr Lowry, I look at the brief bio here and the fact that you were recommended by Ryerson Polytechnic University. Does that mean by the current board of governors or administration within the university?
Mr Lowry: By the current board of governors, Mr Kormos.
Mr Kormos: That's a process which is, in my view, impeccable, one that I wish were followed when it came to district health councils, because it's required of district health councils of course.
I haven't got the slightest idea why you were called before this committee to be interviewed or interrogated about your qualifications. However, would I ever love to talk to you about bank profits and user fees, the way banks are nickel-and-diming little people like the folks in Welland-Thorold to death and generating exorbitant profits, but that's a different forum and a different time and a different place. Thank you kindly.
Mr Ford: Mr Kormos is not a shareholder.
Mr Kormos: But I am a depositor.
The Vice-Chair: Thank you very much for coming before us today, Mr Lowry. Good luck in your future endeavours, and we will be voting later today on concurrence re your appointment. You were very helpful.
Mr Lowry: You're welcome. My pleasure.
THOMAS REID
Review of intended appointment, selected by official opposition party: Thomas Reid, intended appointee as member, Ontario Lottery Corp board of directors.
The Vice-Chair: I call forward Mr Thomas Reid. Thank you for being here today, Mr Reid. We look forward to our short time with you, our questioning. Do you have an opening few comments you'd like to make or do you want to just move into the questioning?
Mr Thomas Reid: I think going directly to questioning would be preferable.
The Vice-Chair: Okay. Just know that you're welcome to avail yourself of the water that's there if you find yourself getting thirsty, or if it gets hot in that seat as it does from time to time. We'll start this round of questioning with the Liberal caucus.
Mr Crozier: Good morning, Mr Reid. How are you this morning?
Mr Reid: Fine.
Mr Crozier: Good. I'd like to talk to you a bit about video lottery terminals. Some who consider themselves to be knowledgeable in the field would call video lottery terminals the crack cocaine of gambling. Do you have any opinion on that comment?
Mr Reid: At this point I know as much about video lottery terminals as I do about crack cocaine, and I'm not an expert on the latter.
Mr Crozier: Well, what do you know about crack cocaine?
Mr Reid: Absolutely nothing. I suspect that Ontario will go through a process of acquiring more knowledge and will probably -- as I understand, government policy, or the wish of the House, is to implement video lottery terminals on a very slow and gradual basis with a per capita machine representation less than the rest of the provinces of Canada. Provided they do that, provided they go and learn and make sure it goes in well, provided they commit to the process of addictive gambling funding that they have promised to do, I think it'll be a balanced implementation.
I think the plan for Ontario recognizes this is a reality in pretty much every other province in Canada, perhaps with the exclusion of British Columbia. It is not a new phenomenon. I think as I read the government's intentions, the House's intention is there's more of a commitment to work with the particular percentage problem of gamblers this might affect in a negative way. I applaud that recognition and I think the art of execution is proper pace.
Mr Crozier: As a member of the corporation's board of directors -- and I don't want to put words in your mouth. You say that you feel the government wants to proceed at a reasonable pace towards this. What would your demands be as a director of that board when it comes to introduction of VLTs, study of impact, distribution of VLTs, use of the money from VLTs? Where would you come from on those major issues?
Mr Reid: First of all, I would want to make sure, as the government or as the House has recognized, of the use of the Gaming Control Commission to make sure that it is properly licensed, investigated, that the licensees are reputable, that it is in a controlled environment. I would want to have a desire to make sure that was absolutely disciplined, so that it was as reputable as the program could be made.
I think it is a reputable program, well handled. The way it's intended to be implemented and the dual role of the lottery commission and the gaming commission I think is a proper one. I would look to see that comes off well.
I would like to understand as early as I can exactly what the program is for addictive gambling, not just as it pertains to video lottery terminals but gambling per se; what the amount of funding is, where it's going to go, what the focuses are going to be, what the mandates are going to be. I would look to see that those things are kept in balance as to where the fund goes and where the proceeds go. As long as it ends up in the proper agencies of the people of Ontario and the citizen benefits as a consequence, then that will be my focus, to make sure that it's well handled.
Mr Crozier: Just to clarify one thing, sir. You've used the terms "government" and "the House." Certainly they're the majority and it would appear as though the government favours this, notwithstanding the fact that Mr Eves and Mr Harris have spoken out repeatedly against them in the past. But it is the government that wants this; I suspect when it comes down to the nitty-gritty, there will not be unanimous support in the Legislature.
You've mentioned the introduction of VLTs in a controlled atmosphere. The government would indicate that they want to move to put them in tier 1 racetracks which I would suggest is a controlled atmosphere, that they want to put them in what are going to be established charitable casinos, which to the degree we can, will be controlled. How do you feel about putting them in bars and restaurants?
Mr Reid: I've just been doing early reading. I have not studied this subject in depth. But I understand the concept is to put them into four-walled environments. In other words, it will not be in an open area. It will not just be walk up to the bar where youth under a certain age can get at it. As I understand it, there's probably a lot of wallboard in back rooms at the moment waiting for this to get off the ground so they can build secluded areas which can be controlled. If they do that, do it well, control access and go through the normal processes that liquor establishments and restaurants do to control youth from getting at those terminals, as long as the licensee stands the chance of punishment, such as losing his licence if he doesn't control the process, therefore the disciplines that exist as they do in other fields will be applied and I think should be enough to control the situation.
1030
Mrs Pupatello: The Ontario Lottery Corp uses its funds for particular purposes, health -- I don't have a list in front of me, but do you see that where the money goes currently should be expanded at all, there should be any change in policy in terms of the use of revenues through the Ontario Lottery Corp?
Mr Reid: I go in with no closed mind. I'd be open to some good input as to where better alternatives for the use of the money would be. But with 85%, as I understand, roughly going to hospitals, with the balance going to athletic development of our youth, those cannot be considered bad things. If someone comes along with a variant, a new alternative, a different spread, I think those are pretty high benchmarks they'd have to surpass. So I would be of the mind I'm going to have to be talked into something going in a different flow until it's proven to be a better purpose for the citizenry.
Mrs Pupatello: What do you think about applying it towards the debt of the province? What do you think about applying the revenues from VLTs, for example, as a new revenue stream towards the Ontario debt?
Mr Reid: I guess, being in the business world, I don't like tax in too many forms, so I would suspect that the people of Ontario -- you'd want to talk to them about it. If I voted as a private citizen, I'd be against it.
Mrs Pupatello: Have you been to Windsor?
Mr Reid: I have been there to take baseball teams to play in tournaments. I've not been to the casino, if that's the question.
Mrs Pupatello: That was my next question, if you'd been to the casino to see the --
Mr Reid: No, I have not.
Mr Gravelle: Good morning, Mr Reid. I want to ask you your thoughts on some specific aspects of the Ontario Lottery Corp, how it runs. To be honest about it, I have a constituent who won't mind my using his name. His name is Mr Tom Stubbings, who owns Fred's Variety in Thunder Bay. He's come to see me about some actual concerns he has about the lottery corporation in terms of basically, I guess, how they spend their money and how they run their operation. Perhaps it isn't fair, but I wanted to use this opportunity to talk to you.
Certainly, he has some great concerns about the fact that they operate in a very independent way. There are apparently about 10,000 or 11,000 outlets across the province in terms of distributors for the Ontario Lottery Corp, in terms of all the games. The feeling really is that there is an awful lot of money that's frequently spent. For example, they will send their packages out to all the outlets by courier, and frequently the packages have to be corrected or they're not very useful to the dealers themselves. This is one contention that's made.
There's certainly the sense of the dropping of the advertising of the "Did you win?" which means people have to come in the store and ask the proprietor what the winning numbers are, which can be a problem when there isn't some advertising. There are a number of things that certainly upset this particular gentleman and I suspect there probably are other people concerned about it.
What I'm leading to, because I appreciate that I haven't formed anything like what is probably a real question: Do you believe it's fair to say that the people who are the outlets, the dealers, should have an opportunity or some access to some kind of input in terms of some of the decisions that the lottery corporation makes? In other words, if they've got some ideas they think will save money or if they think a lot of money is being spent that is somewhat frivolously spent, if they believe that's the case, do you feel the corporation should be communicating with those people and saying, "Okay, you're the guys who are on the ground; you probably know what works," even in terms of some of the games they decide to develop and some of the lottery games they develop? My feeling is that they should, but I obviously wanted to get your thoughts on that.
Mr Reid: Not having met too many of the dealers yet, and only having sat in on one meeting as a pure observer to listen to how the board functions, management functions, it's a little early for me to have too many opinions. I simply would say this: I think it's a good thing to take input at any time. There are methodologies for dialogue. If the franchise is basically the buyer of the ticket, if the franchise is basically the distribution system which is the Mac's store or whatever it might be, I think it's never wrong to get input. There are forums such as focus groups where you can sit down and talk to the buyer of tickets to formulate gain, to formulate concept.
Mr Gravelle: I don't know whether the corporation does that, to be perfectly honest.
Mr Reid: You could do the same thing with the dealer group, and if that is a worthwhile thing and it helps formulate, it being better in toto, I would not be against that. I don't know if that process exists either, but if it does not and it's helpful and someone asked me if I would recommend that, I would always recommend dialogue.
Mr Gravelle: I bring it forward with the hope that, presuming your appointment goes through, indeed you would suggest that there is some unhappiness out there about how it's done. Quite frankly, the major issue is money that is being spent to administer the program that perhaps is excessive. The government members, I presume, will be concerned about this as well. If they are really spending an extraordinary amount of money on shipping stuff out that ends up being useless, for example, can't be used -- because this is what this gentleman told me: "This stuff is not useful to me. I'm not actually using it." We're talking of 11,000 separate shipments to different places. So that would be a concern and obviously --
Mr Reid: To a great degree, I think we could agree that it's always in the eye of the beholder, but I'm looking forward to the reading material on the review that was just done by government of the lottery corporation. As you know, they've undergone a major expense review and there have been considerable reductions made. I applaud all of that. There may be times when of the 11,000 people who like it, 9,000 like it and 2,000 don't. It's in the eye of the beholder to a degree, but if there's waste, I think it's a responsibility to always examine that and get rid of it. If there is input to be gotten that can aid that in a more meaningful way, then we should seek it.
Mr Gravelle: It certainly makes sense to me.
The Vice-Chair: Mr Gravelle --
Mr Gravelle: Let me make one more quick point.
The Vice-Chair: Actually, you're into 12 minutes now.
Mr Gravelle: Wow. Thank you very much for a little more time.
The Vice-Chair: We'll move on to Mr Kormos. I'm just staying in the vein of Mr Kormos, who was very clear about the time lines when we started off this morning.
Mr Kormos: I note that you submitted your application to the public appointments secretariat. How did that come about?
Mr Reid: Just as a little background, I was not born in the province of Ontario. I've been here 21 years.
Mr Kormos: I noted you were from Winnipeg. Stanley Knowles could well have been your MP.
Mr Reid: Absolutely. In fact, I grew up in that district.
Mr Kormos: God bless you.
Mr Reid: David Orlikow and that whole battery of good NDP candidates.
Mr Preston: That's an oxymoron.
Mr Reid: That's an oxymoron? Okay. I'll leave that to you.
Mr Kormos: Don't talk about Stanley Knowles that way.
Mr Reid: I'll leave that to you. Quite simply, I've been here 21 years. I've managed to raise a family and have a good life in the province of Ontario, and you feel like a little payback time. So I've been quite vocal wherever I could that if there was an opportunity to take whatever training I had and apply it to help the citizens of Ontario in any way I could, I would volunteer. So I volunteered.
Mr Kormos: Sure, no quarrel, but did you specifically seek out an appointment to this board of directors?
Mr Reid: No, I did not.
Mr Kormos: It was a matter of making yourself available for any position that you might be suitable for?
Mr Reid: I think that's correct.
Mr Kormos: So there was no specific interest in the Ontario Lottery Corp?
Mr Reid: No, none at all.
Mr Kormos: I have no quarrel with your background and your ability to serve, and serve well, on this particular board of directors. You've been here since 1970, so you've been in Ontario long enough to recall the genesis of gaming in Ontario, the tickets where you tore them open and it was win, lose or draw, basically the very beginning of what are now things like Lotto 6/49.
You're joining -- I should ask some of my colleagues -- such distinguished people as Rob Welch, whom I know well, who is down from my neck of the woods and who is extremely qualified but of course a prominent former Tory minister appointed by the last government. I'm going to mention that from time to time to these folks when they make noises.
In any event, in gaming in Ontario at its inception, as you may know, people scrambled like mad to get their jurisdictions because the distributors were granted geographic areas. There were fortunes to be made, and people did make fortunes at that point in time. Indeed, there is a suggestion that there may have been high levels of patronage. But the people who made the lotto corp successful were small businesses, because we're talking about an era before the plethora of the Becker's and the Mac's and the 7-Eleven stores; we're talking about an era when they were still by and large the mom-and-pop variety stores.
I've just got to tell you -- I'm going to, I suppose, ask some sort of question so that people won't stand in outrage saying that I'm supposed to be asking questions -- what I've noted, and this may well be consistent with what Mr Gravelle was saying, is that the little people are more and more being squeezed out of the process. I appreciate that the Mac's milks, the chains, the Big V drug stores, the high-traffic areas, especially when you're talking about the capital cost of putting in a terminal as compared to simply selling tickets over the counter, have bigger traffic. But more and more I have had complaints and concerns expressed by little mom-and-poppers, the non-chain variety stores, about being denied a franchise in deference to a Big V or a chain store or a chain variety store that's adjacent or across the road.
I've raised in the House instances, for instance, of Brent Warner in Thorold, who was very arbitrarily denied -- his licence was suspended after a dispute but then immediately granted to a chain store adjacent to him, which has basically put the boots to his small business where he employs but a small handful of people but where he also supports himself.
1040
I have raised in the House the case of Chris Bahnuk, who works for the company that's contracted to service the terminals. This young man had identified a defect in the operation of the terminals such that a number that was registered didn't produce a ticket. No problem, because the customer simply had another ticket issued, but the number none the less went into the system -- this is a young technician -- such as to skew, in a very modest way but none the less skew, the integrity of the payout.
He kept calling the Ontario Lottery Corp to report this. The Ontario Lottery Corp then leaned on the company he worked for to fire him. He of course was fired and has been stonewalled, brickwalled, if you will, by freedom of information and it's been a long, painful process getting cooperation from the Ontario Lottery Corp because nobody wants to admit or acknowledge culpability.
Why do I address you in this way? I have certainly no quarrel with your appointment. You're an excellent appointment to this lottery corp. All I say to you is that the lottery corp has grown into a mammoth monster. It's grown into a big business in its own right and I believe has become very isolated from the bona fide small business people who helped make that lottery corp a success in the first place.
You also know that the government is contemplating -- not just contemplating -- is in the process of abolishing the Gaming Control Commission and the Liquor Licence Board of Ontario and merging them into a schedule 3 agency such that there will be no successor rights by OLBEU or OPSEU from the two respective agencies. They're going to be merging the gaming commission and the liquor licence board and probably bringing parts of the LCBO into this new schedule 3 agency, with incredible impact on the workers there. The Ontario Lottery Corp, at the end of the day, is going to have obviously nothing to do with the regulatory process. The Ontario Lottery Corp, in so far as we're aware so far, is simply, and I'm referring to VLTs, going to have ownership, if you will, of the VLTs and responsibility for placing them and so on. There's a really Byzantine new structure being created, this new board, this new agency, which will not have direct political accountability.
Just as the Ontario Lottery Corp has no direct political accountability because it doesn't serve under the control, it's an independent agency, I think there's going to be increased concern about the regulatory body similarly not having direct political accountability. I raise these because they're observations. I simply want to leave you with them. I hope that over the course of time you might help to sensitize this board to some of the concrete problems that are being experienced.
Mr Gravelle referred to these during the course of his comments to you. I say no more. I've written to the Provincial Auditor asking him to conduct a review of the Ontario Lottery Corp because I suspect it will be an incredibly enlightening experience and one that would benefit all of us.
Interjection.
The Vice-Chair: No, you didn't ask a question, but that's okay. We'll move on.
Mr Bob Wood: Some chairs would have cut you off.
The Vice-Chair: Some chairs, yes. He was nice to me this morning.
Mr Bob Wood: True.
The Vice-Chair: Quid pro quo, I think. The government caucus, any questions?
Mr Ford: Thank you for coming this morning, Mr Reid. I look at your background, similar to the other gentleman who was here this morning, and it's excellent.
I've got a couple of questions here for you. Could you please tell the committee why you would want to serve on the Ontario Lottery Corp board of directors?
Mr Reid: As I referenced -- Mr Kormos was giving you the brief history of the corporation -- I basically offered my services to try to help where I could. I think principally one assumes they go through a process of trying to match training to need, if you will, on a board, and basically, because I come from a financial background out of the banking industry and I'm a retailer, if I look at the lottery corporation, one could characterize it as a financial services kind of business. That really is my skill set, if I have any at all, and I think it's a match: square pegs, square holes; round pegs, round holes.
Mr Ford: You realize that there are probably 20,000 or more VLTs in operation in the grey area right now that they just operate, and they don't pay any tax on them or anything else. It's a cash flow for I guess the underground economy, and this is a tremendous amount of money. That's why they were questioning why the government wants to get involved in this. This is one of the reasons why, so that we legitimize the VLTs and get some of that revenue going into the government coffers.
There's one other question: What will be your priorities in orientation as intended appointee of the board? What will you do first to bring up your knowledge of this appointment?
Mr Reid: My normal practice, when I get into something new, is to try and first of all get as much reading material as I can: history of trends in the operation, understand what its mandate is. I understand it's under review, and I forgot the language of government mandates, what they call them, but I understand it is currently looking to be revised. It's to understand that, to understand what the math has been over time, to understand what the franchise is, both with the buyers and with the vendors, the distribution channels, to simply look at what are we trying to do in the sense of maximizing return for purposes of putting it to the hospitals or whatever and then see if there's opportunity to lend retail experience to maximize growth.
Mr Ford: You're going to be well aware of the grey area machines that are in operation now, the vendors or other people can adjust the payouts on these machines, and that's why we want to legitimize these VLTs. I don't have any questions other than that.
Mr Newman: Thank you, Mr Reid, for appearing before the government agencies committee today. Looking at your résumé, we can see that you're a very busy person. In addition to being executive vice-president and chief operating officer of the Eaton group of companies, a director of seven other companies, corporate campaign chairman for ShareLife for 1996, council member of the board of trade and a director of the Retail Council of Canada, with all that on your plate, as an intended board member, will you be able to have the time in your schedule to attend board meetings in Toronto as well as Sault Ste Marie?
Mr Reid: I would. I understand it's sort of a meeting-a-month kind of mandate and subcommittees of up to four, and maybe you sit on one of those. Having said that, I understand the potential for time demand. I would not have stood if I would not be prepared to meet those time schedules.
Mr Doyle: Perhaps the question I'm about to ask you is somewhat related to some of the comments and questions by Mr Gravelle and the comments of Mr Kormos. I wanted to know if you could tell us how you see your experience in the retail business would affect your ability to speak to the concerns and interests of the thousands and thousands of small retailers who are either agents or distributors for the corporation.
Mr Reid: I'm a retailer by 27 years' training. To a degree, that makes me a retailer. Our business is all about listening to the needs of your target customers, having dialogue, listening to input, shaping winning ways both for the seller of the product and the buyer of the product, so I think the experience of defining our customer is taking input, trying to shape product that helps maximize the revenue and return, but at the same time listening to the needs for fairness among all the constituencies is what the retail business is all about. I don't want to be disrespectful, but I look at the lottery corporation as really being in the retail business.
Mr Doyle: Yes, and the difference in size, say, of the organization you've been with for so long as opposed to a small retailer, you don't feel that there is any kind of a difference here?
Mr Reid: There surely is. They make all the money, as opposed to the big retailers.
I took the liberty one Saturday morning of spending half a day in my local 7-Eleven with a sole proprietor, if you will, and actually walked the store and ran the terminals and sold the tickets and just dialogued to try and understand. Once you get through positioning, emotion, the little personal politics, the concerns are not very different.
Mr Bob Wood: Those are our questions. Thank you, Mr Chair.
The Vice-Chair: That's the end of the questioning to you today, Mr Reid. Before you leave, I just wanted to let you know that you're being appointed to the board of directors of a corporation that is very important to me in that it's situated in Sault Ste Marie, which is the constituency I represent. I want you to know that they are very much a good corporate citizen in my community and the people who work in it are some of my neighbours and friends and all of them are pretty outstanding individuals. We'll look forward to your coming to the Sault from time to time to meet and to avail of some of the hospitality we have to offer. Good luck.
1050
Mr Reid: I understand we're there next week, actually.
Mr Crozier: Just for some political -- excuse me, historical -- perspective --
Mr Kormos: That was a Freudian slip.
Mr Crozier: I think so. As far as I know, the association of Kinsmen clubs was the first to start a lottery in the province of Ontario, of any degree. I had the privilege of handing out the first $50,000 grand prize for a lottery in the province of Ontario 20-some-odd years ago. Like many things, and really that slip about political, it was such a good thing that the government decided they'd better get into it at that time. It also grew. I mean, it was bigger than a service organization could handle. But it was quite a thrill to hand out that first prize, and it was in my own community, because I was governor of Kinsmen at the time. So I've followed lotteries from their inception.
Mr Kormos: If I may, and I don't want to be partisan here, but Mr Crozier claims, as he does, but I beg to differ -- when the last government introduced gambling in Ontario, clearly none of its cabinet had ever been down at any of the firefighters' stags on King Street in Crowland, where the true source of gaming was in the province of Ontario.
Mr Crozier: The significant lotteries.
The Vice-Chair: If we really want to get into that discussion, I grew up as a practising Catholic at bingo games, was weaned on that business.
Thank you very much. We appreciated your being here. It was quite helpful.
LOUIS VEILLEUX
Review of intended appointment, selected by official opposition party: Louis Veilleux, intended appointee as member, Northern Ontario Heritage Fund Corp.
The Vice-Chair: For the next interview, Mr Louis Veilleux, I'm going to trade places with Mr Kormos again so that I can ask some questions, if that's okay with the committee.
The Acting Chair (Mr Peter Kormos): By God, Chair twice in one day. If my House leader or whip find out about this, they'll be absolutely apoplectic.
Mr Veilleux, we have half an hour. You are permitted an opening statement or comments, which time is deducted from the time allotted to the government caucus. Feel free, or we'll get right into questioning.
Mr Louis Veilleux: No, I'd just like to take a couple of minutes to introduce myself. Good morning to everyone. I was born and raised in northern Ontario. I resided in Kapuskasing for all of my life, with the exception of when I went to post-secondary education in the University of Ottawa, resided in the Ottawa area for five years, then in Montreal for two and I decided to move back to the north; that's where my roots are. All my family's there.
My work experience is that I've worked in the private sector. I owned my own business for six years and then I sold it and I presently work for the 6/70, which is a regional economic development group. I'm quite proud of the accomplishments that have been achieved at the 6/70. We have a group of municipalities that are finally working together as a region, versus the individual approach. Some of the projects that we have been successful in getting off the ground: a mushroom project, the implementation of a small dimensional sawmill and others.
I'm a school board trustee. I've been a trustee for five years. I chair that school board; I have been chairing now for two years. It's a regional board. My community involvements are mostly related to the activities of my children -- minor hockey, minor ball, summer camp for youth. I was very pleased and proud when I heard that I was a possible appointee for the NOHFC. I'm a northerner at heart and I'm hoping that my appointment will be accepted and look forward to working on the NOHFC.
Mr Martin: I'm going to ask you first off a question that is sometimes seen in this forum as offensive, but I suggest to you for a second that it's not, in that it's part of the questioning that I will try to get into in the 10 minutes we have. Are you a member of the Progressive Conservative Party?
Mr Veilleux: Yes, sir, I am.
Mr Martin: You are. So you support the program, the agenda, of the present government in Ontario and for northern Ontario?
Mr Veilleux: Yes, sir, I do, but we're talking here about the NOHFC, so I support the decisions that have been taken for NOHFC, yes.
Mr Martin: The NOHFC, as you know from probably having done a bit of research in preparing for today and in expressing interest or agreeing to sit on it, is one of the very important arms of this government in the north to stimulate the economy and invest in various and significant ways in some of the smaller communities, larger communities, to make sure that economically there's some stability and that there's some ability up there to generate sometimes the kind of investment that isn't always there because not everybody understands the benefits and the assets of northern Ontario. So certainly, this government's agenda for the north, given that the NOHFC, as I said, is a very important arm of it, would be connected and have some particular relevance.
This government has indicated, for good or for bad, that it wants to get out of the face of business, and that's an ideological position they take and support and are able to justify. However, those of us who work in the north, and you in particular and me in particular -- because you come from a community, Kapuskasing, where government over the last four or five years has played a major role in the stabilization of the major industry that supports that community. In my city, Algoma Steel saw some major leadership given by the previous government in the stabilizing of that industry. The fact that this government is wanting to get out of direct support of and involvement directly in assisting business in the north is problematic to some of us. Does that cause you any difficulty, and in your role as NOHFC director, will you have some difficulty in delineating between what's important, given the mandate of NOHFC, and what in fact it can do, given the agenda of this government?
Mr Veilleux: At my employment, no, I do not have any difficulty, because I've seen both sides. I've seen some projects turn sour because they tried to modify the project just to meet the criteria of a certain program. So workwise, no, and as a director, no, I have no problems with that. A director is just part of a board and the mandate is given by the government of the day and we try to take decisions that will best impact northern Ontario.
Mr Martin: So given that the government doesn't want to be involved in any significant way in working with business or helping business or being directly related to the stimulation of new business in the way that historically and traditionally in northern Ontario we've seen a lot of and your obvious reference to supporting the agenda of the government and seeing the NOHFC as supporting the government's agenda, if in fact it became obvious that there was need for the NOHFC to speak more loudly on behalf of the constituents that it represents, which are all of us who work and live in northern Ontario and want to have a livelihood up there for a long time to come, if there was some conflict between what it is that we felt we needed -- and I'll give you an example.
Algoma Steel, when it was in difficulty in Sault Ste Marie in the early 1990s, needed some major assistance from government. The Ontario government jumped in and became very proactive in working with the partners. The then Conservative federal government said: "No, we're not interested; we're out of here. It sinks or swims, depending on the market conditions." We know ultimately what the result of all of that was and what the result would have been had we allowed the federal Progressive Conservative government to have its way. On which side of the fence would you land in a scenario such as that, given your very important role as a member of this very, very significant organization in northern Ontario?
1100
Mr Veilleux: Sir, you know, you've lived quite an experience in the Sault when the transactions were occurring at Algoma, and so have I with the Spruce Falls deal, and I'm certain that we could sit here probably for days on end just describing the events and all of what transpired and how it transpired. Both are similar, but the events were probably very different.
This government has said that it was out of subsidizing the private sector, but the fact that they replenished the fund with the dollars and have made the commitment to continue putting in $30 million per year is demonstrating that they do want growth and diversification in northern Ontario.
Mr Martin: Which brings me actually nicely to my next question, if I have some time. They have replenished that fund; however, at the same time they've taken literally millions of dollars out of communities through the various mainline ministry programs -- municipal affairs, education, social services -- which supported communities and stabilized communities in the north. So now this token return of money that was there anyway, it was just in a different fund, in a different bank account, to the NOHFC at this particular point. If it becomes obvious to you that what happens is that this money is spent now, even though there's not as much of it, in places where normally money was spent by mainline ministries and it becomes a bit of a shell game that's happening, would you have some objection to that or would that be something that would be okay as far as you're concerned?
Mr Veilleux: The decisions that the government has taken in other sectors -- you mention education, health and so on -- are really not directly linked to being a director on the board of NOHFC.
Mr Martin: I suggest to you that it is, because every penny that goes into northern Ontario ultimately ends up in the economy, circulating, becoming part of the economy. Every dollar that you give to a person on welfare, for example, is a dollar spent in a corner store. Every dollar that's spent on education is a dollar that's not collected via the property tax. So it's all interrelated, you can't separate one from the other, which is what this government is trying to do.
What I'm suggesting to you is as an NOHFC organization that was traditionally set up very focused to support and help the development of business and industry in the north so that we would have a livelihood and an economy up there, if it turns out that that money is going to be spent, as we think it probably will, in these other areas in order to take a bit of the edge off of the very difficult situation that it's creating -- for example, in Sault Ste Marie we figured that by the time this day is done --
Mr Ford: Mr Chair --
The Acting Chair: One moment. Quite frankly, I've stopped the clock, so go ahead, sir.
Mr Ford: Mr Chair, are we supposed to be asking questions here or giving lectures?
Mr Martin: A little bit of both.
The Acting Chair: Yes, sir. Thank you kindly. Go ahead, Mr Martin.
Mr Martin: In Sault Ste Marie, the studies that we've done show that we could conceivably end up losing 1,700 to 2,000 jobs because of the direct decisions of this government and its various line ministries, which will mean if you give the $2 million a month now that's not going into the Sault because of the cutbacks in social assistance, that we'll lose probably upwards to $50 million a year out of the economy of Sault Ste Marie. That has major economic consequences for us.
If it turns out that the NOHFC becomes simply a fund to try and shore up those other areas as opposed to what the mandate was by the government, which was a Conservative government of the day, when it was put in place, will you have some difficulty with that? Will you be willing to stand up as a northerner and challenge that?
Mr Veilleux: Sir, I understand very well when you're talking about spinoffs and impacts. I work almost on a daily basis with a model that's called a community development impact model and how everything is interrelated, but the responsibility and the role of a director of NOHFC will be to take the best decisions possible to impact most positively northern Ontario with the mandate that will be given to us.
Mr Martin: And you will, though, stand up for Kapuskasing and the north as opposed to supporting the agenda of this government, which is destroying the north, in your role as a member of that board.
Mr Veilleux: As a director of NOHFC, I will do to the best of my capabilities with the directions and the mandate that will be given to us. I cannot give myself responsibilities other than that.
The Acting Chair: Thank you kindly, Mr Martin. It is now open to the Conservative caucus members to make statements or ask questions.
Mr Leadston: I won't be making a statement about the north. Even though I live in the south and was born in southern Ontario, I enjoy the north. I have a great many friends up there and I have, I believe, the same kind of passion that you have for northern Ontario as Louis has in his role and the fact that he just came back there.
I've known Louis through school and it's good to see you again here this morning. I guess it's a personal disappointment, as a candidate in the June 1995 election for this government, not to have succeeded in that goal, and you've achieved many goals for the northern communities. I guess it was a personal disappointment, but nevertheless that's democracy in action and the type of man that you are, you just pack up and get on with life and work in your community.
Your role as a board of directors -- and I look at the list on page 6 from the research service. There is another individual, Sylvie Doucet, who's also with economic development, and a background -- in fact, I think the background of all the directors who are there, unlike other boards, where it tends to have a focus from, say, a financial area or another area, this one here I think symbolizes the north, because it's very symbolic, it's very diverse from backgrounds and interests and certainly expresses the fabric of the northern community.
Louis, in your background, particularly in economic development, I guess there would be a tendency, as was alluded to, that there may be some focus to Kapuskasing. But knowing you, you would be looking at northern Ontario as a whole. Maybe you could expound on that in terms of the issues facing the north, the issues the board would face and your role in time to balance those concerns. Maybe you could just express your thoughts.
Mr Veilleux: I view my experience in economic development as a real asset. Northern Ontario is 90% of the area but only 10% of the population and it's very much dispersed. We've looked at all sorts of projects. We quickly realized that it's very difficult for one community or even one region to be able to sustain a manufacturer or small manufacturers. We really have to look at the broader picture.
On the mushroom project that we worked on, if we would have looked at our area alone we would never have been successful at getting it off the ground. But when we looked at northeastern Ontario, we quickly realized that there was a market of 750,000 pounds of mushroom in northeastern Ontario and to have a feasible farm you need 350,000. So, yes, we were successful at putting the farm together, but it's serving all of northeastern Ontario.
Another project we're working on is a trading house, and we quickly realized that even northeastern Ontario was not large enough and did not have enough economic activity to sustain such a venture, that we needed all of the north.
I have a broad enough vision of all of the north to be able to take the best decisions for the north by sitting on NOHFC.
Mr Leadston: Thank you very much. Very good to see you again this morning.
Mr Ford: Mr Veilleux, I was just listening to the comments from across the floor about Algoma Steel, and he's telling you all the problems they had in Algoma Steel. I had a friend who was doing $600 million worth of business and couldn't fulfil their contracts. This was a highly successful company, and I can show you the films on it. This was a highly successful company that was doing good business, employed probably 10,000 or more people at the time, and the union said they were going to close it down if they didn't get their demands. This went on and on and on. This company could not fill their contracts with the American companies. My friend owned a couple of them, and he was so frustrated with these people it's unbelievable, and it's like this person sitting across there saying all the problems for the workers. Some of those problems they created themselves, and I have proof and fact of that matter.
1110
Anyway, getting on with that, sir, what are your qualifications for this position as an economic development officer for Kapuskasing? Do you think you are fairminded about the needs of the region?
Mr Veilleux: Yes, sir, I think I am, and because of the experience that I've gained and the expertise, on numerous occasions there are other agencies or organizations that will come in and consult and ask me my opinion on projects or the general economy, not only of the region but all of northeastern Ontario.
Mr Ford: Good. You were a Conservative candidate. We've gone through that.
The current government has returned -- as they say, it was in another fund, but they didn't know where it was for a long time -- $60 million, and they are also committed to $30 million annually to the fund. Let me again suggest that some of these problems that they've had in the north have been self-inflicted through not using a little common sense. They've learned some hard lessons up there about business, and some of these contracts, some of these companies they had contracts from were long-term contracts. They didn't fulfil those contracts, and that's why they ran into the situation they ran into. I think these people have learned a good hard lesson, and the next time they get that Algoma Steel rolling again, I hope for their own wellbeing that they keep it going, because these were all high-paying jobs they had at the time.
Mr Doyle: I wonder, could you tell us, Mr Veilleux, why you'd want to serve on this corporation board?
Mr Veilleux: Because I'm a northerner at heart. I moved to southern Ontario for post-secondary education, was in the workforce for two years but decided to go back home, and I view the north as still being an area where there are opportunities.
The dollars that this government has put back into the heritage fund was good news for the people in the north. Everybody is very much excited, looking forward to what exactly the dollars will be utilized for, and $120 million is a considerable amount of dollars for northern Ontario, and everybody is hoping that the best decisions will be taken to impact positively.
The Acting Chair: Mr Preston, very quickly.
Mr Preston: Very quickly, Louis will do a hell of a job. Thank you very much.
Mr Crozier: Good morning, sir. In looking over your experience, you're the development officer for Kapuskasing, or at least the project coordinator. Can you assure this committee -- because you will have access to information as part of your position -- that there will be absolutely no conflict of interest in that the information you may receive about parties interested in having development in northern Ontario won't be used for the benefit of Kapuskasing over any other community over which this fund may have some jurisdiction?
Mr Veilleux: With my board, it is understood that there is the question of confidentiality, not only within OHFC but also with the project I am working on. More often than not, the board members are not familiar with what I am working on. There are many northerners who are tunnel-visioned and will view their community only, but I have enough experience in this field that I have gone beyond that and will look at benefiting all of the north. Because EDO for Kapuskasing is not specifically for Kapuskasing but it's the region as a whole and we work with other regions also. We work with Timmins, we work with Kirkland Lake, we work with the New Liskeard area, and what benefits one benefits all, so yes, sir.
Mr Crozier: It won't be easy to keep that conflict separate and I certainly wish you well in doing that.
Mrs Pupatello: Welcome to the committee this morning. Tell me, after you decided to run for the Conservative Party in the last election, were you aware that they were going to change the mandate of the fund for the north to not assist individual businesses, or did you have the idea that was an appropriate move and felt comfortable running as a candidate with that?
Mr Veilleux: The question is if I was aware at the last provincial election if assistance to private sector was going to be removed. Is that the question?
Mrs Pupatello: To the north through this fund, and you are from the north, a northern candidate.
Mr Veilleux: When I ran in the election, the decision of running was wanting to be a stronger voice for the north, wanting to serve the electorate of Cochrane North and northern Ontario and all of Ontario. I really did not focus at the time on --
Mrs Pupatello: Specifically this fund.
Mr Veilleux: Specifically on that.
Mrs Pupatello: If you have a situation arise today like the Algoma Steel situation, would you fund Algoma Steel if you could do so today? Would you have done what the last government did in funding that project? At the time, did you think it was appropriate?
Mr Veilleux: Ma'am, it's as I said, every project is an individual project.
Mrs Pupatello: I'm thinking of that one individually. Would you fund it? Would that have been your decision?
Mr Veilleux: I'd have to look at all the details before I give you a straight-out answer, yes or no.
Mrs Pupatello: You were involved specifically in saving the pulp mill. You were on the committee to save the pulp mill in Spruce Falls with a number of others, to save that particular company, which is a private company. In doing that you've certainly indicated your support for that northern fund being used for the private sector, and that in fact is the most significant change in the mandate of the northern fund. How do you feel about having been on a committee to save that particular company and now going on the board of the organization whose mandate will no longer do that?
Mr Veilleux: I don't know for a fact whether NOHFC participated financially in the Spruce Falls deal. Did they?
Mrs Pupatello: Yes, it was looking for support from the fund and you were assisting in doing that, so I'm suggesting that --
Mr Veilleux: Because we had a business plan as a community. It is a success story and there are many who want to take part, but --
Mrs Pupatello: I guess I just wanted to mention to you that it's clearly a significant reversal in position to have been involved with a specific company to save the paper mill and now you would go on the board of a fund which will not save the industry.
Another point that was alluded to earlier: When you have a position such as project coordinator for the Kapuskasing area economic branch there, that is a 24-hour job, isn't it? Isn't it the kind of management position that you just are on all the time? No matter where you go, social activity, you're always sort of working, I suppose. Would you agree?
Mr Veilleux: Yes, when you're viewed in the community, you're always viewed as the economic development officer for the 6/70.
Mrs Pupatello: Yes, that's the same in the town I come from as well. How would you do your job properly as economic officer for those six municipalities actually in the region? How would you do your job properly, if when sitting on the board is supposed to be assisting the whole 50-some municipalities involved in the board? How do you see that's not a conflict? I have a great deal of difficulty in your being able to do your job properly, specifically for your six municipalities that pay you to be that -- 24 hours a day as you've agreed -- and then going to a fund that's supposed to really look out for the whole area, and it often may be the case, to the exclusion of that area for which you are responsible.
1120
Mr Veilleux: The 6/70 has come a long way. The municipalities are finally working together as a group, and also they network with other regions, so you just get accustomed to it. It's just as when I am chair of the school board.
Mrs Pupatello: You just get accustomed to what? Excluding your own municipalities in favour of other municipalities?
Mr Veilleux: No, ma'am. What I'm referring to is that you get accustomed to the fact that at times you are coordinator of 6/70 or at times you are chairperson of the school board or at times I will be the director in NOHFC.
Mrs Pupatello: Do you think the people of your six municipalities would be pleased that -- and I'm assuming you're paid by taxpayers -- you would be doing the work that would be assisting municipalities other than your own?
Mr Veilleux: I think it should be the residents of the area that should be answering that question, but when they heard of my possible appointment, everyone was very proud.
Mr Gravelle: Good morning, Mr Veilleux. I have a number of questions I'd like to ask you. I don't know how much time we have left.
One specific concern is, when you were talking earlier, you spoke in terms of being appointed as a director and simply following the mandate of the government. One of the greatest concerns I had, I guess, and I certainly have about this fund, because it's an extremely important fund, is the possibility of the board simply ending up being a rubber stamp for what the government recommends. It was very early in your comments and it alarmed me, I will tell you, because I think it's extremely important that if the board is going to be effective it truly has to have a role to play beyond simply saying, "Okay, that's what you tell us we can do, that's what we can fund." I would like your thoughts on this because my feeling strongly is that the board members should have a true say in what the mandate is. Also, do you absolutely agree with the decision to no longer help businesses and create jobs in that fashion, in terms of the whole support of businesses in the communities and some of the single-industry community help?
So, one, tell me about your thoughts on simply following the mandate of the government and that's it, that's your job, because if so, that truly alarms me; and two, do you support the changed mandate which basically takes out support for business in the north?
Mr Veilleux: In the mandate that has been announced and what I've seen in the media and a little bit in the business plan, in what was said by Mr Eves, I don't think the programs are yet defined for NOHFC.
Mr Martin: It's a year down the road.
Mr Gravelle: It's certainly a lost year. The mandate hasn't been determined, is what you're saying, for how the fund will be --
Mr Veilleux: I'm saying that the little information I've had until now is that the programs are not yet defined and that they want to get the board working as quickly as possible on inputting what shape these programs could take. I think the directors of the board will have some input on how the NOHFC will operate and what programs they're going to be offering.
The second part of the question was whether I support change of mandate. Once we know all on how the programs will be defined, what sectors they will assist, that this government is out of providing subsidies, I have no difficulty with that.
Mr Gravelle: If this is a small business to create jobs or keep jobs or keep the business going, you simply view this as subsidies that should be eliminated?
Mr Veilleux: It's not as simple as that, sir. If the subsidy is required to keep employment going, you really have to question it. I believe it was Mr Ford who was saying there are difficulties other than just the cash flow. You can't make it as cut and dried as that. The business will continue because of the subsidy or the business will continue because it possibly needs some mentoring, it needs assistance with management. I've seen some big businesses that thought the problem was financing and years down the road realized that it was not only that.
The Acting Chair: Mr Veilleux, there are now motions for concurrence. You can stay if you want or you can leave if you want. Mr Wood, I trust you're moving concurrence with the appointment of John Lowry?
Mr Bob Wood: I am.
The Acting Chair: Any debate? All those in favour, please indicate. Opposed? Carried.
Mr Wood, are you moving concurrence with the appointment of Thomas Reid?
Mr Bob Wood: I am.
The Acting Chair: Any debate? All those in favour please indicate. Opposed? Carried.
Mr Wood, are you moving concurrence with the appointment of Louis Veilleux?
Mr Bob Wood: I am.
The Acting Chair: Any debate?
Mr Martin: I'm going to oppose this appointment for a couple of major reasons and just a general sense of unease with this. One is, I will not be party to the government using boards and agencies of this government to reward defeated candidates. You've been doing it since you got here.
Here again today we have another example. A person runs for your party, isn't successful at that level in being involved in the government of this province and you find a way to place him on a board or commission that is going to have significant relevance and impact for this province, particularly this commission, which is one of the major ways this government, over a period of years, initiated by a Conservative government, assists directly the business and industry of the north. In the north, as I've been saying to you over the last year that we've been meeting here as a committee, we face particular and unique challenges to our ability to both attract business and industry and sustain it because of the dips and peaks of the economic cycle.
For you at this particular point in time to be bringing forward someone simply because he was a defeated candidate in the last provincial election to me is questionable at best. But more fundamentally, I'm going to oppose this appointment because I don't have the feeling, from the conversation we've had with Mr Veilleux, that he will stand up for the interests of the north, that he will be more interested in the agenda of this government and will be willing to support and continue to support the actual devastation of the north by way of decisions that are being made every day by this government to withdraw its services, to withdraw its support, to withdraw the resources we need in the north to maintain any kind of stable economy, any kind of stable social network, any kind of stable education and health system in northern Ontario.
Sault Ste Marie alone -- I've already put it on the record a few times -- is going to suffer to the degree that we will be losing anywhere between $30 million and $50 million a year, depending on the impact of the infamous tax break on our community. To suggest that just because this government has returned the $60 million that we took out and put into general revenue, which we thought was the prudent thing to do at that time to the fund, given the fact that they haven't spent a penny this year and the Liberals were spending and we were spending on average $30 million a year in the north -- this year they spent no money -- the $60 million will be the $30 million for next year and the $30 million that they didn't spend in the north last year at a time when we needed it more than ever before because of what they directly have been doing to the economies of our community.
The decision you made in July 1995 to take a quarter of the resources away from the poorest in our community, the most vulnerable, those people who were dependent on social assistance for their livelihood, to take 21.6% out of their pocket didn't simply take food off the tables of families with children and in some instances take adequate, dignified, decent homes away from some folks; it also took, in my community, on average $2 million a month out of the economy of Sault Ste Marie. That money was being spent in the corner stores, in the malls and around our community. Money that goes into the pockets of working people and poor people does not get spent in Florida, nor does it get invested in offshore corporations; it gets spent in Welland and Thorold and Thunder Bay and Sault Ste Marie and in the north, that kind of contribution to the economy, because it's all integrated. Mr Veilleux said himself that it's all integrated. You can't separate one from the other. It's all part of it. The whole package has a major impact.
1130
This corporation was set up by a previous Conservative government recognizing that we have some unique challenges in the north re the ongoing stability of the economy and our ability to provide services at a level that you in the south take for granted, that the corporation would work directly with business and industry to make sure they had what they needed to stay competitive and to have some longevity in terms of their ability to do business.
I will not be supporting this appointment on these two grounds particularly: (1) I will not work with this government to find ways to reward defeated candidates, and (2) fundamentally I don't think this appointment, this person on the board of NOHFC, is going to stand up strongly enough and be a voice for the north in these very difficult times to oppose what this government is doing directly to its economy.
Mr Gravelle: I will not be supporting this appointment as well. The northern Ontario heritage fund is an extremely important program and, in light of everything that's gone on in the north and some of the issues that Mr Martin has outlined, it becomes all the more important because of what has been taken away from the north and what has been a virtual abandonment of the north by the northern development minister.
The heritage fund is extremely important. The only way it's going to truly work is if appointees to the board are there literally and functioning as more than a rubber stamp. I'm very concerned, based on Mr Veilleux's comments, that he's quite prepared to operate that way, that he'll wait for the direction the government gives him and simply say: "That's fine. We'll follow orders."
I happen to know a number of other appointees to the fund and would support many of them. Regardless of their party affiliation, I would support them because I've spoken to many of them and they've made it clear to me what role they intend to play in terms of having a significant impact on what comes out of that fund. Whether or not they're successful is another matter, but they have made it clear to me that yes, "We want to play an important role; we want to discuss what the mandate is." I remain guardedly optimistic that the board members may have some impact.
When you have an appointee who seems to be literally there to more or less be cooperative in terms of what the government puts forward -- I would think the government itself would also want to have board members who would be willing to say: "This is the direction we think this should go. We're the northerners. We can give you some advice with this money." I must admit it seemed pretty clear to me that Mr Veilleux has not given much thought to what aspects of the fund he wants to put forward, which I find odd in terms of his role in his professional life. I find that rather unusual. As a result, I am not comfortable supporting him and will not be voting for his appointment.
Mrs Pupatello: I just want to express my concern and that I won't be supporting this gentleman as an appointment. It really doesn't have anything to do with his position as a candidate. I would like to think that had I not been successful in June, I might still be considered valid to serve the Ontario government in some form, so that really doesn't bear weight in terms of my decision. I need to say, though, that when you hold a position that is as significant as this gentleman's is as his full-time employment, I have some significant concern that he really can do justice -- sorry, Mr Wood, I was hoping I might get your attention, because I know you'll be voting on this motion.
The Acting Chair: Go ahead, Mrs Pupatello.
Mrs Pupatello: Mr Wood, I was hoping that I might have your attention, given that you would be voting, and I thought that it was fairly important that you hear my comments. Excuse me.
The point I was making was that his party affiliation really is irrelevant; what's more important is what this gentleman does for a living. When you have that kind of significant position within a community -- his is a six-municipality community and economic development and part of the north, and governments for decades have struggled to get proper development in the north because of the significant issues that we southerners frankly don't face -- you can't divide the time, in terms of the way you think, when it's your job 24 hours a day, as this gentleman agreed, to do that for the six municipalities he works for. It's very hard to have a larger view in terms of the whole north and it's really significantly a conflict for him to be put forward in this way.
I'm sure that, as Mr Preston mentioned earlier, he's a terrific worker etc, and I think that's fair, and he should be called upon to do some kind of service, just in a different capacity, not necessarily this one, because it is such a significant conflict. I would be surprised that his own community wouldn't have a problem with him doing this job, because his eyes really should be on those six municipalities which are paying him to do that job. I think that's important, and it's important we send a strong message to the north that we're putting people in positions where they are warranted.
Mr Leadston: The comments of the members opposite don't surprise me. I think your comments are very shallow and very narrow-minded, particularly about someone who speaks passionately about the north. Here's an individual who was born in the north, left the north to be well educated, returned to the north and has made significant contributions to the northern community, not specifically to his community and his neighbourhood but to the northern community.
I've never seen such narrow-minded thinking and comments from the members opposite. Again, that doesn't surprise me. When you think of conflict, you already have an individual on here from the Timmins Economic Development Corp. Does this mean that individual should be off? With all due respect to some of the others, we have a dairy farm operator. I don't mean anything disrespectful to someone who operates a dairy farm, but isn't that somewhat of a narrow focus in terms of northern development? The diversity of the individuals on the board, the wealth of experience and knowledge that Mr Veilleux will bring to the board is going to develop a tremendous blend of knowledge and expertise, and the benefactor is the northern community. But the comments don't surprise me. Obviously I will be supporting this candidate.
Mr Preston: This conflict-of-interest thing is blown way out of proportion. It suggests that any one of us gets elected and that everything we do is focused on our home town.
Mr Crozier: No, it doesn't.
Mr Preston: Yes, it does.
Mrs Pupatello: It's not the same.
Mr Preston: It is the same. I was elected to cover a large portion of southern Ontario, not just Cayuga, not just the area that surrounds me. I have to deal with everything from the centre of Lake Erie right into Cambridge and I do that. I think this gentleman will do just the same thing, and very competently. As you understand, I'm in favour of this appointment.
Mr Bob Wood: It seems to me that this is a very well qualified candidate. I do not consider it a disqualification that he is a past candidate. I think that shows a commitment to public service and gives him a good feel of what the people in his area are thinking. It's of interest that he's going to take effectively no pay for this job, and I think he's to be commended for doing that. It's quite clear that he sees his function on the fund as working for the whole region, not for one particular part of the region. I think it's clear he's going to stand up for northern Ontario and for Ontario generally. It's quite appropriate that he supports in general terms what the government is attempting to do. I think he's a good candidate and that he'll do the north proud. We're going to support him.
The Acting Chair: Is there any further debate? No?
I shall now put the question. Motion for concurrence with the appointment of Mr Veilleux.
Mr Martin: A recorded vote, Mr Chair.
The Acting Chair: A call for a recorded vote.
Ayes
Doyle, Ford, Fox, Leadston, Newman, Preston, Bob Wood.
Nays
Crozier, Gravelle, Martin, Pupatello.
The Acting Chair: The motion for concurrence passes.
SUBCOMMITTEE REPORT
The Acting Chair: There's now a motion on the floor for concurrence with or acceptance of the report of the subcommittee.
Mr Bob Wood: I move that motion.
The Acting Chair: Any debate regarding that?
Mr Gravelle: I just want to make sure I understand it. We're talking about August 7 as one day, is that correct, and September 3, and then September 4 and September 5 as well?
The Acting Chair: September 4 and September 5 in northern Ontario.
Mr Gravelle: That's what I mean. September 3 would not be in northern Ontario. September 3 would be down here and September 4 and September 5 would be in northern Ontario?
Interjection: Yes.
The Acting Chair: The report as it stands now is for September 4 and September 5 only to be in northern Ontario, as I read the motion.
Mr Leadston: Do you know where it is? Can I ask where we're going in terms of locations?
The Acting Chair: Not on this motion.
Mr Martin: That was to be worked out. There was going to be some discussion with the House leaders around the logistics of all that.
Interjection: If they don't give us the time, there's no point in planning on where we're going to go.
The Acting Chair: Any further debate on the acceptance of the report of the subcommittee?
Mr Martin: Just to clarify so that the people understand, September 4 and September 5 in the north was our attempt as a subcommittee to respond to some comments last week by Mr Ford and others that perhaps it would be in everybody's best interests to go up to the north re the discussion we had, ONTC and norOntair, to see first hand what the challenges are so that when we make decisions down here and have these discussions, everybody is a little more informed. That's what this is about. It's a chance for us to go north for a couple of days.
We're looking at, this time around, because it's ONTC-focused, maybe up as far as Moosonee and back, the northeastern corridor, to see what challenges are up that way and to educate all of us around some issues in some communities that are served by that.
Mr Bob Wood: We on the government side haven't quite concluded what the focus ought to be. We want to get up there and see what people are saying. Obviously that will be a matter of discussion among all parties.
Mr Martin: You would agree, though, that it flowed out of our discussion about norOntair and ONTC, that that's what this is coming out of?
Mr Bob Wood: It's just generally an interest in going to the north and seeing first hand the problems and talking first hand to the people where they live.
Mr Martin: But it did flow out of that discussion.
Mr Bob Wood: It certainly did. Yes, it started there.
The Acting Chair: No further debate. All in favour? Opposed? Carried. Meeting adjourned.
The committee adjourned at 1142.