Journal des débats 1982-juin-22 | Assemblée législative de l'Ontario

Hon. Mr. Pope: Mr. Speaker, I am pleased to announce to the House today that thanks to the rapid expansion in the private sector's tree stock production we have a planned production level of two trees planted for every tree harvested.

Mr. T. P. Reid: You've got to be kidding.

Mr. Speaker: Order.

Mr. Foulds: Did the minister say "fruit trees"?

Mr. Wildman: Can he say that with a straight face?

Hon. Mr. Pope: If the member had been in estimates last Thursday, he would have heard all this.

Last year, we harvested approximately 65 million trees in our province. That harvest level definitely will not be exceeded this year. This year, we have established the capability to produce 132 million trees. Most of these trees will come from two sources.

Our existing bare root nurseries will continue to produce 90 million trees annually. Fifteen million container stock will come from our own greenhouses and another 22 million will come from private greenhouses under contract with my ministry in many parts of northern Ontario.

In addition, we are negotiating for additional production by private nurseries. By 1985, our production capacity will be 150 million trees, and we will not stop there.

I am heartened by the enthusiasm the private tree stock producers have shown in helping to meet our target. Their rapid expansion and the outstanding quality of their stock has made it possible for us to attain our planned production level.

As you can see, Mr. Speaker, we are moving into a new phase of forest management in Ontario. Man's use of forests can be divided into several key phases. The one we are entering, symbolized by my announcement today, is the most advanced of these phases. The rate of natural regeneration can be accelerated by many means which are now being implemented throughout the province. This natural regeneration is not considered in the two-to-one ratio I mentioned earlier.

What we are now doing is growing a new forest to ensure that our valuable forest resources are maintained. Our forest management agreements embrace this concept. Through our FMAs we contract private industry to help us manage our forest resources. These private firms combine harvesting and regeneration activities to guarantee a sustained yield.

By 1985, we will have about 30 FMAs which will virtually cover all forest operations on crown land in Ontario. As the members know, crown land accounts for 87 per cent of the land in Ontario.

I know that all members of this House will join in supporting our ongoing efforts in forest management.

[Applause]

LOTTERY FUNDING

Hon. Mr. Pope: In light of the reaction from the members across the floor, I have a second statement.

I am pleased to tell honourable members how the Ministry of Natural Resources plans to use almost $1.4 million in provincial lottery dedications available to us this year. The major portion of those funds, $1.25 million, will be used for rabies research, one of our top health priorities. The remaining $144,000 will be used for flood plain mapping projects in northern Ontario.

I would like to briefly outline our intended plans in each of these program areas. Rabies has great economic and public health effects in our province. It costs Ontario residents more than $12.5 million annually. We need a vaccine which can reach wildlife, the major source of the disease, without affecting the environment.

My ministry has contracts with a variety of groups that are working to develop such a vaccine. These include the universities of Guelph, Toronto, Queen's and Saskatchewan, as well as Connaught Laboratories Ltd.

As for flood plain mapping, we will use the $144,000 to define and map flood plains on the Goulais River just north of Sault Ste. Marie, at Lake Nipissing and in the towns of Hornepayne and Atikokan. These maps will be used to regulate development in the flood plain, reducing the risk of damage or injuries due to flooding.

I know that this money will be well spent and the results will be most beneficial to residents and visitors to the province.

Mr. Speaker: Oral questions. The Leader of the Opposition.

Mr. Peterson: Mr. Speaker, perhaps you would be good enough to inform me if the Treasurer (Mr. F. S. Miller) or the Minister of Revenue (Mr. Ashe) is coming in today?

Hon. Mr. Davis: Mr. Speaker, if that is the first question of the Leader of the Opposition, I will answer it in the affirmative.

Mr. Peterson: Why does the Premier not take 15 minutes and skate around on it for a while and waste a little time.

Hon. Mr. Davis: Mr. Speaker, if the House would permit me, I wanted to check the wording of this telex personally; it was just a minute or two late getting here. So that the Leader of the Opposition will have time to reassess his question in case he wants to direct it to me, I would like to make a brief statement.

Mr. Speaker: Do we have the consent of the House?

Agreed to.

ROYAL BIRTH

Mr. Bradley: As long as it is not a propaganda statement you have consent.

Hon. Mr. Davis: The member for St. Catharines thinks this is a propaganda statement.

Mr. Bradley: No, it could not be, from the Premier.

Hon. Mr. Davis: That is what he said. I pay attention to everything the member for St. Catharines says. Most of it is irrelevant, but I pay attention.

I join with all Ontarians in expressing my sincere congratulations to Their Royal Highnesses, the Prince and Princess of Wales, on the birth of their son. This royal occasion is happy for many reasons, most notably that mother and child are both reported to be in good spirits and in good health.

Her Majesty's loyal subjects in this province would want me to send a message of congratulations to the royal family and I have taken steps to send the following message on behalf of all citizens of the province. This telex was sent to Their Royal Highnesses the Prince and Princess of Wales:

"The people and the government of Ontario share in the general rejoicing which has greeted the birth of your son and our affection and good wishes are with you at this happy time.

"It is our hope and prayer that you will enjoy all the happiness to be found in a warm and loving family circle and that our new prince will be granted an abundant measure of life's blessings."

2:10 p.m.

The evolution of the monarchy and its continuance as a stable symbol of unity and democracy is very much the result of the human concern, sensitivity and spirit which so typify the work of the members of the royal family and the relationship they enjoy with their people. The birth of an heir to the throne is not only an important symbol of that family's continuity but also a happy and joyous occasion when the miracle of new life casts its ray of sunshine upon all of us.

Yesterday was a great day for Canadians and a very great day for the monarchy. On behalf of the government and the people of our province, it is an honour for me to express our congratulations and most sincere best wishes to the entire royal family on this joyous occasion. God save the Queen.

Mr. Peterson: Mr. Speaker, I would like to address a few words on the same subject. I did not want to be too aggressive about it because I was not sure if the Premier was going to make a statement and did not want to appear to be crowding him, particularly on a matter concerning the monarchy.

On behalf of Her Majesty's loyal opposition I would like to extend to His Royal Highness, Prince Charles, and his wife, Diana, Princess of Wales, our loyal greetings and sincere congratulations on the safe delivery of their first-born child.

God willing, this baby boy is destined one day to become King, an awesome responsibility in this modern age. In the years that lie ahead many hopes and plans will be built around this tiny bundle of humanity, but today thousands of well-wishers around the world are content to share with his young parents the joy and delight that are inextricably bound up in the constant miracle of the birth of a baby.

Last summer, we all shared the excitement and happiness of the royal wedding. Today, we share the welcome news that mother and baby are fine and that the happy father thinks his new son is "not bad."

To a much-loved young couple who have now become a family, I express on behalf of my party our very best wishes for health and happiness in the future.

Mr. Foulds: On behalf of the members of the New Democratic Party caucus and our people throughout the province, I would like to extend to Charles and Diana, Prince and Princess of Wales, our congratulations on their first-born son. A first-born of either sex is terribly important in any new couple's life, as I am sure this prince will be in that couple's life, and in the life of Great Britain and of those countries like Canada which are proud to continue to be associated with Great Britain.

The new prince has an awesome tradition to live up to in that the present royal family in Britain has combined the tradition and heritage of royalty with a very real, common, human touch. That was exemplified by one of the uncles of the new-born prince, Prince Andrew, in his service to his country in the recent crisis over the Falkland Islands. I am sure with examples like that, the new prince will serve not only his family but his country and our country very well.

ORAL QUESTIONS

RETAIL SALES TAX

Mr. Peterson: Mr. Speaker, I have a question for the Treasurer. Going into the public hearings, as we are, next week. I know the Treasurer is approaching those in a fair-minded way, in spite of the comments of some of his backbenchers. like the member for Oxford (Mr. Treleaven), who said that the post-budget hearings would be an exercise in futility for the public because a majority of the 11 voting members are from the Conservative Party. He said the hearings would be a media exercise where closed minds will vote to retain the budget.

I do not believe the member for Oxford. I stand with the Treasurer. I think he wants to make these hearings meaningful and wants to receive constructive input so that, collectively, we can try to clean up some of the worst aspects of the budget.

Recognizing that a number of groups will be coming before these hearings over the next couple of weeks and that they want to be constructive, would the Treasurer tell those groups, before the fact, the kinds of points he is prepared to listen to and what criteria he will apply to changes he is prepared to make in his budget to make it more fair? For example, is he concerned about the regressiveness of a tax proposal, and if that can be proved to him in these committee hearings, would he be prepared to change his mind on some of these issues?

Hon. F. S. Miller: Mr. Speaker, just as my honourable friend is going to that committee believing I will take it seriously, I am going to that committee believing he does not intend to make it into a stage show, either.

I intend, as I always do, to listen seriously to the people who come before this government year after year offering their points of view, and I intend to be very glad to listen to changes that may be administrative in nature, things that deal with unnecessarily complex regulations or with catching groups of people with the policy that it was not the spirit and intent of the bill to catch. Of course, I intend to listen to them, as I always have.

Mr. Peterson: I very much appreciate the open mind with which the minister has come into this entire process. But beyond the technical questions, which I agree with the Treasurer must be looked at very seriously, and I know he wants to hear input on them, is he prepared to look at some of the conceptual problems in the budget: for example, as I asked him earlier, the regressiveness of some of the provisions? And if that can be substantiated to him, would he be prepared to re-evaluate some of his taxation proposals? Would he be prepared, for example, to look at the impact on jobs, and, if it can be established to him that certain jobs will be lost as a result of his budget, would he consider that an important point to be brought forward to the committee? Is he looking at it essentially as a factor in taxation, and if it can be proven to him that certain items are essential, would he be prepared to alter some of his tax plans?

What I am asking the minister, and I am just giving him three examples, is whether he is prepared, ahead of time, to tell the various groups who will be appearing before the committee the criteria he will be judging their proposals on? How can we know what he will consider seriously unless he tells us ahead of time?

Hon. F. S. Miller: I think I would be showing great temerity to tell the people what I should hear from them. Surely the process is for them to tell me what they believe I should hear, and that is what I expect in that process.

There are certain buzzwords people use with great abandon, assuming that if something is "progressive" it is good, if it is "regressive" it is bad. I for one have never been caught up in buzzwords or in cute economic theories that may be popular for a year or an age.

Certainly, the major objective and the major theme of the budget was the creation of jobs. I would suggest to the Leader of the Opposition that the citizens of Ontario understand this and that the foofaraw that has been created by him and by the members of the other party has taken a tiny part of the budget and blown it up to a great extent. They have not spent any time giving their attention to the moves we made that many good critics have said were essential at a time when a government should be devoting its attention to the creation of employment.

We bridged the gap during this recession by government jobs; we set the stage for reinvestment of capital; we have created an atmosphere in Ontario that says, "We want you here if you are going to invest money." And just as the Leader of the Opposition said in Sudbury last week that he did not believe there was any Liberal in any part of Canada who could win a seat anywhere in this country, let me tell him there are a lot of Conservatives in this country who could win, and we, at least, are realistic enough to know that you cannot talk out of both sides of your mouth at the same time when you are in economic trouble, as he was in Sudbury.

Mr. Cooke: Mr. Speaker, since it has now been adequately documented for the Treasurer by the Association of Municipalities of Ontario and by individual municipalities that because his budget came in after the mill rates were set and because the sales tax is going to affect them by one to two per cent of their budgets, I would like to ask, is he now prepared to admit that part of the budget was wrong? Is he at least willing to put that part of the tax off until January 1, 1983, or compensate them with a grant or, better still, eliminate that part of his retail sales tax bill?

Hon. F. S. Miller: Mr. Speaker, I just asked the Minister of Municipal Affairs and Housing (Mr. Bennett) if he had heard from AMO requesting a meeting with me or if they were coming before the committee. I do not know either at this point.

2:20 p.m.

This morning I met with the Minister of Education (Miss Stephenson) in that role -- I met with her last week as Minister of Colleges and Universities -- dealing with both of the groups who represent those areas, the Ontario School Trustees' Council and the Council of Ontario Universities, looking at the effects of the budget. I want to say we had very realistic discussions.

They are not always things people want to hear, but I would suggest this was done in a friendly and constructive atmosphere. They may turn up at the committee meeting to press their points further. I pointed out half a dozen times, though, there is no one date in the year when I can coincide my actions with everyone's fiscal year beginning.

Mr. Peterson: The Treasurer has a most interesting theory. Our job is to point out the bad parts and his job is to point out the good parts of his budget. If that is the criterion, we have been the resounding winners, believe me.

In the spirit that these new hearings will have, I am making two requests of the Treasurer. The first request is, will the Treasurer speak quietly to the members he will have on that committee to make sure that they do not follow the suggestions of the member for Oxford (Mr. Treleaven), who anticipates it will be a futile exercise and that closed minds on the Conservative side will be dealing with this?

My second request is, and it goes to the process, could the Treasurer give some indication to the people who will be appearing what criteria are important to him? If it is jobs, would he say so, and they can present the information they have on how it will affect jobs in this province.

Hon. F. S. Miller: I thought I had answered that specifically in the second part of the honourable member's question. I did say in the beginning of my budget statement that the creation of jobs had remained, with the tools I had available for me, the most important task I could have. I simply point out that task has been made extremely difficult for me this year in what has to be recognized, even by authorities such as Business Week magazine, as a disastrous economic climate in Canada because of the total mismanagement by a party called the Liberal Party; a party which the opposition is trying quickly to divorce themselves from. I understand they had 225 people in Sudbury and 113 of them were from southern Ontario.

Mr. Peterson: I have just determined the Treasurer's problem. All his information comes from Claire Hoy. They have a very nice relationship, I am sure.

HYDRO CONTRACTS

Mr. Peterson: Mr. Speaker, I have a question for the Minister of Energy (Mr. Welch) with respect to the Madawaska Mines contract. Is the minister aware if Ontario Hydro has considered the firm proposal made by a local citizens' committee -- which included the reeves of the village of Bancroft and the township of Faraday, the president of Hastings District Chamber of Commerce, as well as the president of the union -- which would have kept the Madawaska mine open for another three years with the assistance of some modest provincial subsidy to keep that mine going? Has he considered that? Has Ontario Hydro considered that? And has he given a definite proposal back to that group, which very much wants to keep that mine going?

Hon. Mr. Welch: Mr. Speaker, as I mentioned to the House when this matter was first introduced following the consideration of the proposals by the Hydro board, the member for Hastings-Peterborough (Mr. Pollock) in his very efficient way arranged a number of meetings here at Queen's Park. Father Maloney and others to whom the Leader of the Opposition has made reference were involved in those meetings. Meetings were held under the auspices of the member for Hastings-Peterborough with the chairman and some of the officials of Hydro, at which a number of proposals were considered. The board of directors of Hydro considered the proposals in the light of what their requirements would be, taking into account the efficiencies, the cost and all other factors, and have awarded the contracts as they announced last week.

Mr. Peterson: In spite of the good efforts of the member for Hastings-Peterborough, it has not brought any results in the circumstances. I am asking the minister to intervene and I am asking him what his role is with respect to this entire matter.

For example, I point to an interview with his good friend Hugh Macaulay, the chairman of Ontario Hydro, who said, talking about his responsibilities as chairman of Hydro, "Instead of merely looking to meet anticipated demand, we are now considering a wider role for Ontario Hydro and are considering the effects our large construction projects, our exports, our rates and, in fact, all our activities, have on the social, environmental and economic life of this province." He recognizes that he has a wider responsibility. That is his view.

On the other hand, we have a spokesman from Hydro saying that Ontario Hydro cannot make social decisions about keeping mines open. There is some confused sense of who is responsible for what on this matter.

May I ask the minister: surely it is his responsibility as the Minister of Energy and as a member of the cabinet to make sure that every single possibility is examined to keep that mine open? What has he done? What kinds of discussions has he had? Is he prepared to make some compromise, or to work to try to keep that mine open?

Hon. Mr. Welch: I think it is unfortunate to be making references to the efforts of members. I want members to know I am very proud to be in the same caucus as the member for Hastings-Peterborough, who has attached a very high priority to this work. Other than that, there was a single question from the member for Quinte (Mr. O'Neil) and some tokenism on that side, while the member for Hastings-Peterborough has worked day and night attempting to make sure every possible angle was examined. I want that to be quite clear on the record.

Second, in so far as the government of Ontario's response was concerned, had the Leader of the Opposition been in his place on Friday he would have heard the Minister of Natural Resources (Mr. Pope) making some reference to what was going to be some response regarding the mining opportunities in that particular area.

As to the broader role of Hydro, I understand the Leader of the Opposition and the chairman of Ontario Hydro had an interesting discussion on CBC Radio yesterday. Notwithstanding the chairman's persistent efforts, the member refused to be specific with respect to the sorts of things he had some advice about, which is fairly typical of the line of questioning for which he is known.

Mr. Foulds: Mr. Speaker, can I get the Minister of Energy to say, quite clearly, that he does not see Ontario Hydro playing a role in the economic development of the province, when it will not play a role in the economic development and maintenance of jobs in eastern Ontario in this particular case? Does he think it is not now time for the Minister of Energy to exert his authority and to insist that Hydro play an economic development role in the province, where that is justified?

Hon. Mr. Welch: Mr. Speaker, I repeat that my colleague the Minister of Natural Resources stood in his place on Friday to respond to some particular situation in that part of Ontario dealing with the economic welfare and health of that community. I assume the deputy leader of the New Democratic Party, who, as the critic for the Ministry of Energy, is quite familiar with the legislation which establishes Hydro, knows that Hydro has some responsibility to the electricity customers of this province to provide power at cost.

Therefore, when there are considerations with respect to outlay and the security of supply, you can hardly criticize Hydro in attacking their particular --

Mr. Wrye: Careful --

Hon. Miss Stephenson: I think that was thunder, not Hydro.

Mr. Foulds: It came close.

Mr. Breithaupt: The next one will be closer.

Hon. Miss Stephenson: It is obvious you are speaking the truth.

Hon. Mr. Welch: I would not presume to interpret that as confirmation, but for my purposes today that is exactly how I am interpreting it. It may be just a carryover of the 21-gun salute after the announcement of the Premier with respect to the birth of the prince.

Surely that is what we expect Hydro to do, to be accountable to the electricity customers of the province?

Mr. Eakins: Mr. Speaker, since a number of the workers also live in Haliburton county, I share the anger and disappointment of the member for Hastings-Peterborough.

I would like to ask the minister why he has allowed the economic props to be kicked from underneath the town of Bancroft? Ontario Hydro argues that it did not accept the proposal from Madawaska Mines because it cannot make social decisions about keeping mines open. Why then did the government not make that decision in view of the tremendous economic benefits not only to Bancroft and Haliburton but to eastern Ontario? In his decision not to keep this mine open, did the minister balance the costs from the public purse for make-work projects against the benefits of keeping that mine open?

2:30 p.m.

Hon. Mr. Welch: Mr. Speaker, I cannot add much to the answers already given. Hydro was faced with the responsibility of addressing the proposals that were submitted. As the member for that area, if he reads the daily newspaper circulated there, the member will know that apparently it felt editorially that Hydro had no alternative but to do as it did.

In all fairness, we should point out once again to the members of the House that the reason the mine is closing this week or next week is because of the cancellation of an international contract which would have gone until the end of the year. The Minister of Natural Resources, in his attempt to be helpful with respect to this matter, announced some aspects of that program on Friday.

ECONOMIC DEVELOPMENT

Mr. Foulds: Mr. Speaker, I have a new question for the Treasurer about the budget. Does the Treasurer recall that the key premise of his budget was stated on page 4 and said: "The Ontario economy should strengthen during the balance of the year. Real growth in GPP in the second half of 1982 should be four per cent on an annual basis"?

Since over the past week we have had economic indicators indicating the evidence is otherwise and that his crystal ball was all fogged up, what new measures is he going to introduce to rebuild Ontario's economy?

Hon. F. S. Miller: Mr. Speaker, unless I have misinterpreted the indicators the member is referring to, and I would be glad to have him elucidate, what we pointed out was that the recovery across the balance of the year would just about equal the loss in the first half. As I recall, in the newspapers this week we got the first-quarter results for Canada, which showed a decline. We knew that when I produced the budget. It showed a drop in jobs and a drop in real output.

I pointed out in response to a question some time around June 5 that we had two months in a row when the net number of people employed in Ontario increased. I think it was some 4,000 in April -- it may have been a little higher -- and some 11,000 in May on a seasonally adjusted basis. In May, it was 109,000 on an actual count basis, perhaps the biggest month-over-month increase in the number of people at work in Ontario.

We predicted approximately 125,000 people would return to work across the balance of the year. I admit some of them were on short-term layoff, but the net number of people at work the last two months has shown that trend. I hope when June's figures come out they will also maintain it.

For all the problems around us, we have a uniquely Canadian problem as opposed to a world problem, no matter what our friends in Ottawa are saying these days. The United States is showing improvement in consumer purchases while Canada is dropping. The United States has a lower savings rate than Canada. The question then is, why are Canadians not buying when in many cases they have the resources to do so? I suspect the answer is confidence in the future of this country, confidence that has been totally destroyed by the government in Ottawa.

Mr. Foulds: Does the Treasurer not now realize that we are experiencing, in the present tense, at the present time, as deep an economic crisis in Ontario as we have experienced in 50 years? Tinkering is not going to get us on the road to recovery. We need to create jobs. As the Treasurer said about Mr. MacEachen's budget, and I quote, "It did not address the economic conditions of the day." Will he not now admit that his budget does not address the economic conditions of the day? Is it not about time he made a commitment to this House to bring in a new budget before we rise for the summer recess?

Hon. F. S. Miller: The member is using my budget as a reference and I guess I can too. When I wrote this budget I said I did not bemoan what could not be done. I sought out the positive things we can do to create jobs and new investments, the things we can do to reinforce confidence in our future and maintain an affordable standard of services for our people.

I recognize the opposition party is, by tradition, a critic of government. That is fair enough, but the member is being pedantic so let me be pedantic. Let me be didactic if he wants me to be. The fact is we have serious problems in this country, but one of the most serious is the constant emission of gloom and doom from so many people, including the members over there. They are destroying the confidence of people who may have some cause to be positive.

Mr. Peterson: Mr. Speaker, I assume the government's approach is to anaesthetize people rather than face real problems. However, let me ask the Treasurer a question with respect to his budget. Does the Treasurer agree with his colleague the member for Oxford (Mr. Treleaven) who said that preparing provincial budgets without public input was a failure of the government? Does the Treasurer not believe we could solve some of these problems more easily if he allowed some public discussion before he brought in a budget that in retrospect is so ill-fated and ill-timed?

Hon. F. S. Miller: Mr. Speaker, the Leader of the Opposition talks about anaesthesia. He is the only person I know who got a degree cum laude honoris causa in anaesthesiology.

Interjections.

Mr. Speaker: Order. Now to the answer, please.

Hon. F. S. Miller: I hope the cameras were on the member for St. Catharines (Mr. Bradley) because we like replaying these in the local areas to show them the maturity and confidence of the people they elect to this Legislature.

If one uses the words of the lady who has not returned to this House since the defeat in Hamilton, as I recall she said, "A Liberal is a Liberal is a Liberal." I just pray tell and would ask the member if I could, but I cannot, what makes him think he is a different Liberal from those in Ottawa? What makes him tell the people of Ontario he has solutions when it has all been fouled up by people who call themselves Liberals in Ottawa?

Mr. Foulds: We do not wish him to be pedantic, didactic or partisan but he is the Treasurer of Ontario and will he not take some creative steps when he realizes the depths of the crisis in Ontario? Retail sales are down, manufacturing plants are closing weekly, if not daily, and bankruptcies are up. People are losing their homes and their farms and the country's gross national product recorded in the first quarter, as the Treasurer said, its largest drop since 1953. Layoffs in Ontario have increased by 248 per cent over the last year and mortgage rates have once again hit 20 per cent.

Does the Treasurer not admit that is an Ontario crisis for the people of this province? Does he not think it is his responsibility as Treasurer of this province to create jobs to get the economy moving again? Does the Treasurer not think he needs to bring in a new budget? Does he think Ontario is just going to sleep through the summer?

2:40 p.m.

Hon. F. S. Miller: I was just handed a news bulletin which, if it is accurate, may be part of the answer. It is the reason I waited an extra month. It says the federal government will present a new budget on Monday night. If it does what we believe it will do, a good part of the assistance will be undertaken. If it does what it should do, remove the fear, the lack of direction, the lack of confidence of investors, consumers and workers in this country, then obviously the steps I have already taken to create jobs, which the member does not like to admit to --

Mr. R. F. Johnston: The Treasurer should do the same thing. Why doesn't he show some leadership instead of punishing the poor --

Hon. F. S. Miller: The member does not like to go back home and tell the small restaurant operator who has a seven per cent tax that he does not have to pay corporate tax this year, does he? He does not want to admit that. He does not want to admit the restaurant operator will have more money to invest in his business because of a step I took. He does not want to --

Mr. R. F. Johnston: The Treasurer is doing it to the poor just as much as Trudeau is. He is attacking the poor.

Hon. F. S. Miller: Just be quiet over there. The member for Scarborough West --

Mr. R. F. Johnston: No, I won't.

Mr. Speaker: Order.

Mr. Conway: Does the Treasurer remember what he said about MacEachen's budget in November?

Mr. Speaker: Your turn is coming.

ASSISTANCE TO HOME OWNERS

Mr. Foulds: Mr. Speaker, I would like to return to the Treasurer and his responsibilities as Treasurer in this province. As he will no doubt realize, three-year mortgages are at an all-time high at the 19 3/4 per cent to 20 per cent level, which puts families in Ontario into a new round of mortgage renewal roulette. Does he realize, for example, that if a family is coming off a five-year term and renewing a $40,000 mortgage for three years, that means an extra $253 per month or $3,045 per year? What is the Treasurer going to do? Is he going to bring in an interest rate relief program specifically to assist those people, as has been done by other provinces?

Hon. F. S. Miller: Mr. Speaker, obviously I am watching with some interest what other provincial governments have done to get elected. It will be very interesting to see whether it works or not. I just want to say I cannot have the member criticizing me across this House for having too high a deficit when he recognizes the number of dollars --

Mr. Foulds: I never did.

Hon. F. S. Miller: The member may never have criticized me for that, but these gentlemen do.

Mr. Foulds: Don't link us with those guys.

Interjections.

Mr. Speaker: Order. Never mind the interjections. Address yourself to the question please.

Hon. F. S. Miller: I have to say, compared to the third party, they are a deep pink not a pale pink, so I do not think we should link them.

The fact remains that the number of dollars needed to have a support program of that nature is very large. One has to recognize it is a major redistribution of income and it can be very difficult for people who have already paid off their mortgages. So it is not as simple as the member says.

More important, in my budget I have pointed out that the federal government has a program. It is starting to lend $3,000 to many people, depending upon their status, to get them through what they hoped would be a short period of high interest. The most important item right now, with our dollar dropping, is to have Canadian economic policy at least supportive enough so our dollar does not go down and our interest rate go up simultaneously. That is happening right now because money is fleeing this country.

Mr. Foulds: May I remind the Treasurer of the quote from his budget on page 8 dealing with this specific problem? He says: "Little would be gained by a provincial initiative that would only duplicate a program that seems to be working. Nevertheless, the government is concerned about this situation and we are closely monitoring the progress of the federal program and the state of mortgage markets."

Surely the monitoring by the Treasurer, if it is at all up to date, shows him that the federal program is totally inadequate, that in Ontario to date only 1,009 people have been assisted, and that by his own figures 40,000 families in Ontario are having their mortgages come up for renewal at a rate that will be in excess of 30 per cent of their income, and thus their homes could very well be at risk. What is he going to do to assist those families?

Hon. F. S. Miller: In the final analysis, nothing will help except reduction of interest rates. Reduction of interest rates still remains quite possible. I would suggest to the honourable member that we are monitoring and we are seeing some progress in that area and we are seeing the federal government continue with that program. We are always told not to duplicate programs; let us give it a chance.

[Later]

Mr. Foulds: On a point of order, Mr. Speaker: I apologize to the House for a figure I used earlier in the day. There were not 1,009 Ontario families assisted by the Canada mortgage assistance plan; that figure was for all Canada, not Ontario. I was far too optimistic.

Mr. Roy: Mr. Speaker, given that the Treasurer's program and his budget exemption of corporate tax for small business will be of some assistance, in view of the high interest rates why did the Treasurer not consider giving some measure of relief to people with small businesses who are not incorporated? There are many of those. In fact, those who are not incorporated are likely paying a higher rate of tax than those who are incorporated. Why would he limit the exemption only to corporations who incorporate and not give some relief to those who are not incorporated but are having to face very high interest rates?

Hon. F. S. Miller: Mr. Speaker, my friend is a lawyer.

Hon. Mr. Davis: Full time.

Hon. F. S. Miller: Yes, full time. He would recognize there is one restriction and one remedy. I would suggest to him that if he wants to drum up business on Mondays and Fridays I can give him a little way to do it. He can suggest that a number of those small businesses incorporate. That is number one.

Mr. Cassidy: Why don't you quit? Just quit.

Hon. F. S. Miller: Just a second, while he looks at the gallery to see if he is getting any reaction. Before the member gets too smart, he knows the only tax I control independently in Ontario is the corporate income tax. The personal income tax is controlled by the federal government; we only get a share of it and we do not set the rules. If the members read my budget papers they will find a paper there suggesting the pros and cons of Ontario going it alone. If we went it alone, we could do what he is saying.

Mr. Foulds: May I return to the question of mortgage interest rate reduction and help. Is the Treasurer aware that the Canada Mortgage and Housing Corp. revealed to our caucus this morning that in the first quarter of 1982 there were at least 2,000 families in Ontario who were in arrears on their mortgages by three months or more?

Does the Treasurer not agree that those families at least, those 2,000 families who are desperately trying to hold on to their homes and who are three months in arrears, are in very real danger of losing their life investment in those homes? Does he not think he has a responsibility to assist those people in this province to keep their homes?

Hon. F. S. Miller: My colleague the Minister of Municipal Affairs and Housing (Mr. Bennett) can probably talk at great length on this issue, because I believe he has looked into the problems of a number of these difficult cases. He is not here at the moment, but I would suggest that very often when one looks at the economic state of somebody who is in financial trouble one cannot say it is simply a mortgage problem. One may find a good --

Mr. Foulds: That is why we asked you to create jobs, which was my previous question.

Hon. F. S. Miller: Just a second. One may find there is a good deal of consumer finance for a number of items that, properly or improperly, have been purchased and have compounded their troubles. By itself, the home would have been supportable, but the sum total of all their debt is not. I am not blaming anyone for that, I am simply saying that is the case in many instances when the people come before us.

UNEMPLOYMENT

Mr. O'Neil: Mr. Speaker, I have a couple of questions about Madawaska Mines for the Minister of Energy. He mentioned that the member for Hastings-Peterborough (Mr. Pollock) had arranged for the people to come up from Bancroft to meet with them. I know they are going to ask us again to meet with the Minister of Energy. In fact, I think they already have. What is the minister going to tell them this time? Is he going to be able to give them any answers as to what they are going to do to keep the mines open? There are busloads of these people coming up here tomorrow to petition in front of the Legislative Building and in front of Ontario Hydro. What sort of answer is the minister going to give them for the problems they face?

Hon. Mr. Welch: Mr. Speaker, I was not aware of their arrival, but the Minister of Natural Resources (Mr. Pope) and I, along with the member for Hastings-Peterborough, would certainly be very pleased to meet with any delegation from that area.

2:50 p.m.

Mr. O'Neil: I do not think they are as interested in meeting the minister as in having him give them an answer as to how they are going to be helped.

I might say to the minister that the Minister of Natural Resources mentioned his statement on Friday, which I have read several times and which the people of that area have read, but we do not have specifics on it --

Mr. Speaker: Question, please.

Mr. O'Neil: Will the minister be more specific about some of the job creation things that the government is going to do if it is not going to help the Madawaska Mines? I refer to such things as developing a walkway along the York River, looking at a kraft mill that has been talked about for the past seven or eight years and other projects. Will he or the other minister give us some specifics as to when those jobs will start? Will he tell us what the jobs are, how many people they will employ, how long they will last and other specifics, if the government is not going to help the miners?

Hon. Mr. Welch: If I understand the honour- able member, he wants more specifics with respect to a statement made by my colleague. Perhaps I would be wise to refer that to my colleague.

Mr. Kerrio: Remember how you campaigned, saying, "A cabinet member will help you"? Don't give us that routine.

Hon. Mr. Pope: Or the Liberal Party's alternative, which is nothing. Let the honourable member give us his party's alternative, which has been nothing for a long time.

Mr. Speaker, the member knows full well that one estimates the sustained yield of that hardwood and softwood inventory in eastern Ontario. He also knows full well the programs we have put in place with respect to hybrid poplar.

Mr. O'Neil: When? When?

Hon. Mr. Pope: When? If the member had taken the time to read what is going on in his own part of the province he would have seen the advertisements in the Globe and Mail and in the other financial publications. He would have known that when we found out the mine was going to close we contacted the producing companies in the forest products sector. He would have known that we made deals with respect to the industrial minerals sector to create some permanent jobs with respect to silica.

Mr. O'Neil: I've read them, and there were no specifics.

Hon. Mr. Pope: If the member had read the press releases that went out on industrial minerals over the past three months he would have known the specifics. If he really cared, he would do a little bit of homework for a change.

USE OF HERBICIDES

Mr. Wildman: Mr. Speaker, I have a question for the Minister of the Environment. Now that the minister has had an opportunity to review the concerns I raised in the letter I delivered to him last week regarding the use of Tordon 101 and Tordon 10-K in the Algoma district, will he agree to suspend voluntarily the use of these herbicides by private and public agencies in the province as well as by ministries of the government, until such time as the new tests that are now going on are completed by Dow Chemical?

Hon. Mr. Norton: Mr. Speaker, the matter had been brought to my attention prior to its being raised in the recent letter to me by the honourable member and was referred by me to the Pesticides Advisory Committee, which conducted a very thorough review of all the available literature on the matter and a review of the reports from the United States which had given rise to the concerns that have spread across North America.

The committee produced a very comprehensive report, which concluded that there was nothing to substantiate the concerns that have been raised and that the present restrictions we have on the use of those chemicals in Ontario are the best way in which to proceed at this time; so I have no intention of changing the present classification.

Mr. Wildman: Is the minister not aware that the doubts raised about the tests done by Industrial Bio-Test Laboratories in the United States have led to the ordering of new tests in that country? Is the minister willing to approach the federal government and ask it to place a moratorium on the registration of these compounds in Canada until such time as those tests are completed?

Failing that, is he not prepared at least to require the agencies using these herbicides to post notices so that people will know where the spraying is taking place and will not be picking berries and having children consume berries in areas that have just been sprayed?

Hon. Mr. Norton: Both the Department of National Health and Welfare and the Department of Agriculture are fully aware of the information to which the member refers. It is the responsibility of the Department of Agriculture to determine whether a particular chemical, such as Tordon, is available on the Canadian market.

We already have it classified in the most restrictive classification, and we have had it so in Ontario from the beginning. There is no more restrictive classification that we can place on it. If the member has views that go beyond that and if he can substantiate them, then I would suggest that he direct them to the Honourable Eugene Whelan or the Honourable Monique Bégin.

Mr. Elston: Mr. Speaker, in the light of the controversy surrounding not only the spraying of Tordon in that area but also the spraying of Sevin in the Kingston area, I wonder if the minister will require in future that the spraying of these at least questionable chemicals comes under public scrutiny and that some kind of committees be set up locally in these areas to advise citizens when the spraying is going to take place, the amounts to be sprayed and how the spraying activity is to be monitored by members of his ministry?

Hon. Mr. Norton: Mr. Speaker, I think the honourable member is surely aware that considerable advance notice is already given by the Ministry of Natural Resources in situations like that. In fact, if I am not mistaken, in the situation to which the member refers, in I believe the Kaladar area of eastern Ontario, the owners of private land had requested initially that spraying take place. That was subsequently changed as a result of concerns that were raised primarily by constituents of the member for Hastings-Peterborough -- I am sorry, I mean the member for Quinte (Mr. O'Neil).

Interjection.

Hon. Mr. Norton: He is such an empire builder when it comes to his pretences around this place that I sometimes get a little mistaken about that.

I think if the member checks the procedures that are followed by the Ministry of Natural Resources he will find essentially that what he is requesting is already done.

ASSISTANCE TO FARMERS

Mr. McGuigan: Mr. Speaker, in the absence of the Minister of Agriculture and Food (Mr. Timbrell) my question is to the Premier. Will the Premier take up an urgent matter with the Minister of Agriculture and Food and his cabinet? It is a matter that is of vital importance to a number of cattle producers in southwestern Ontario, some of whom have taken losses as high as $160,000.

The Kent Federation of Agriculture forwarded a resolution to the Ontario Federation of Agriculture calling for the coverage of cattle bankruptcy losses retroactive to January 1, 1982. Their intent is that when funds start to accumulate after August I under the program the minister has recently announced, the cattle producers would be gradually reimbursed from that fund. This would not be a burden on the taxpayers; it would be a burden that the cattle producers are apparently willing to meet.

I ask the Premier to look into this matter seriously and try to alleviate this problem.

Hon. Mr. Davis: Mr. Speaker, I am more than prepared to take it up with the Minister of Agriculture and Food. I only caution the honourable member, because I do not want to lead anybody astray, not to interpret that to mean that we --

Mr. Kerrio: Oh, you are changing your policy now.

Hon. Mr. Davis: I am delighted to know that the member for Niagara Falls has sufficient talent to distinguish between one and the other, but I accept that he can.

I ask the member who raised this question please not to communicate back home the fact that I am taking it up with the minister means that it necessarily will lead to some altered policy. I do not want to lead anyone astray; but yes, I will take it up with the minister.

Mr. Riddell: Mr. Speaker, the Premier is no doubt aware that the Minister of Agriculture and Food asked the fraud squad to investigate the McIntyre bankruptcy. I wonder, when he talks this over with the minister, will he pose the question to him that was asked by a livestock producer in the Chatham Daily News:

"If Stewart" -- that is Stewart McIntyre, the owner of the livestock sales -- "was in the financial difficulty the papers lead us to believe, why, I ask you, the Royal Bank, did you wait until the busiest week in the year to shut him down? The week you shut him down sees the biggest movement of finished cattle to market and also the biggest movement of feeders to grass and feedlot. Why was that particular week chosen to pull the plug? If it had to be done, why not in the winter when stockers and finished cattle are barely moving?"

3 p.m.

Can the Premier tell us, or have the minister reply to our question, whether the Royal Bank was indeed involved in rather fraudulent exercises in connection with this McIntyre affair?

Secondly, and supplementary to the question of my colleague the member for Kent-Elgin (Mr. McGuigan), since this government under the act can put in seed money as well as giving a loan of $250,000 and guaranteeing a bank loan of $1 million, why can the government not use these provisions under the act to provide the money that is necessary to pay these livestock producers, who could well go out of business? As Mr. McGuigan indicated, there is $160,000 due to individual farmers from this bankruptcy. The government could put that money in. Why do they not do it and get these farmers off the hook?

Hon. Mr. Davis: Mr. Speaker, I sense there are at least three or four questions there, and I am not sure just which one the honourable member wants me to answer. I answered his colleague the member for Kent-Elgin (Mr. McGuigan). I believe that is his colleague's seat, although I guess the member calls him Jim.

I think the member should be a little careful of the language he uses in describing anybody. I am not aware of some of the material he read. As for the suggestions he is making, obviously I do not intend to comment on them. I think the member must be content with the answer I gave to his colleague the member for Kent-Elgin, that I will raise the question asked of me, and I shall do so.

FOREST MANAGEMENT

Mr. Laughren: Mr. Speaker, I have a question for the very defensive Minister of Natural Resources dealing with the overall management of forests in Ontario but also specifically regarding his statement earlier this afternoon, since this is not the first promise we have had of planting two trees for every one harvested.

How does the minister intend to monitor and manage this new, increased forest in Ontario in view of the fact that we are losing foresters in Ontario to other jurisdictions and the ones we have now in the Ministry of Natural Resources primarily are pushing papers? How does the minister intend to manage this increased forest with these problems?

Hon. Mr. Pope: Mr. Speaker, I am glad the honourable member recognizes the fact that we are now planting two trees for every one harvested. I appreciate his support.

Mr. Foulds: No, you are not.

Hon. Mr. Pope: If he will come to the estimates tonight, I will show him again the way I did last week. He should really take the time to learn about it.

We still maintain a high complement of very competent foresters. We still have those foresters in the field. The question the member posed was discussed last Thursday in the estimates and will be discussed again tonight and tomorrow. I have every confidence in the professional capacity and capability of our staff to adequately monitor our reforestation and forest management programs.

Last week in estimates, in a discussion with the member for Lake Nipigon (Mr. Stokes), we talked about the new techniques we are using with respect to monitoring performance in reforestation and I indicated there had been a book published on the subject. I will be pleased to provide it to the member so that he can inform himself.

Mr. Laughren: When the minister is managing this planned large increased forest, will he make sure the people in his ministry understand that they are not above the law and that his ministry must follow the law like everyone else in Ontario? If he will agree to that, will he tell us how it is that comments like the one I am about to quote come out of his ministry in reference to the Environmental Assessment Act as administered by the Ministry of the Environment? It reads:

"Increasingly, administration of the Environmental Assessment Act is becoming a bureaucratic nightmare and the health of the environment seems to be second now to due process and procedure." Further: "The zeal of some of the Ministry of the Environment staff is not being properly harnessed and channelled by senior MOE management." And further: "The rigid application of the act upon the Ministry of Natural Resources displays an apparent lack of awareness of MNR activities or appreciation as to how these might be effected."

Finally, quoting further from MNR staff: "It is felt that the issues associated with the allocation of land through land use planning for various recreational and resource extraction activities are far too critical to be dealt with through the added dimension of cumbersome Environmental Assessment Act requirements."

Does the minister agree with those kinds of bullying tactics and attitudes towards the Environmental Assessment Act, and will he assure us that he will launch an educational program for those people within his own ministry who seem to think his ministry is above the law in this province?

Hon. Mr. Pope: I am glad the member is in favour of the Environmental Assessment Act and is therefore in favour of the processes we have followed with respect to the multidisciplinary examination of forest management agreements, the five-year operating plans, the annual cutting plan, and of the fact that the public has, in the open house forum, the right to come in and look at all these documents and the right to examine the five-year operating plans of the ministry.

I am glad he is in favour of the process of land use planning whereby we have provided documentation over a period of 10 years to the people of Ontario to communicate with them the details of our land use planning, the concepts, the targets. I am glad he agrees with our approach with respect to parks planning and the process under the Parks Act whereby we have master plans developed by our ministry staff available for public comment.

If he really examines what we are doing, he will see it is on all fours with the Environmental Assessment Act.

Mr. Conway: Mr. Speaker, can the minister indicate what response, if any, there has been to an advertisement placed by his ministry in, among other publications, the Toronto Globe and Mail of Tuesday, June 8, concerning a forest development opportunity in the Bancroft area?

Is the minister in a position today to indicate to this House what response, if any, there has been to that initiative, which would be very timely in terms of an uptake given the very critical situation in which the north Hastings area finds itself this week?

Hon. Mr. Pope: Mr. Speaker, we have received some replies and, as I indicated last Friday, there were two indications of interest from two forest products companies and we are pursuing them.

BRUCE HYDRO LINE

Mr. McKessock: Mr. Speaker, I have a question for the Minister of the Environment.

Ontario Hydro submitted a plan to the consolidated hearings board for delivering power from the Bruce nuclear power complex to southwestern Ontario and the hearing officers, in a split decision, decided against the recommended route M-1, which Hydro put before the board, and came down in favour of the M-3 route.

Grey county residents and, I suspect, Bruce and Simcoe residents did not know the board could do that but thought the hearings were only on the M-1 route. It is no wonder they thought this, because the hearings were all held in Stratford on the M-1 route and no notices were received by the municipalities saying the board could reject Hydro's chosen route put before the Environmental Assessment Board and pick another route.

In view of these facts, will the minister extend the hearings before the cabinet makes the final decision and hold at least a few days' hearings in the area of M-3 route recommended by the consolidated hearings board to allow the people affected to have some input?

Hon. Mr. Norton: Mr. Speaker, although I have not personally reviewed in detail all the documents that were submitted by Ontario Hydro, I think the honourable member, and those on whose behalf he asked the question, will recognize that all the alternative routes were described and the hearing applied to them all.

After the conclusion of what has already been a lengthy hearing -- it was open to the public and anyone could participate -- to ask that it now be reopened because someone was ill advised by counsel or whatever, surely is impossible. Otherwise, there could never be an end to the hearing process.

I think the simple answer is no.

3:10 p.m.

Mr. McKessock: If all routes were looked at, why were all the hearings held at Stratford on the M-1 route chosen by Hydro, 100 miles away from the Grey-Bruce-Simcoe route that was finally chosen? It looks as if it was done to reflect only on the M-1 route and to deflect input from other areas.

I believe this was the consolidated hearings board's first attempt, but why were notices put in the paper using a lot of words but saying nothing about the six routes being looked at'? I have in my hand one of the notices that was put in the paper. It says nothing about the six routes that were being looked at.

Hon. Mr. Norton: Obviously I do not determine the location of the hearings; that is a matter for the board to determine. It is my understanding that prior to the commencement of the hearings, meetings were held involving not only the proponents and counsel but also counsel for others who were interested in participating as a preamble or preliminary to the beginning of the hearings. If there were a concern to be expressed about the locus of the hearings, that would have been the appropriate time to raise it, not after the conclusion of the hearings.

Surely the member understands that if a hearing is to be held which covers a number of alternatives and which could cover the whole of southwestern Ontario, at some point a decision has to be made on a reasonably central location for such hearings. Otherwise, every time there is a shift in the evidence that is being heard on one or the other of a number of alternatives, one would have to close up shop and move 100 miles down the road to hear the next part of that hearing. That does not make any sense.

It is true that if people have 100 miles to travel, it is something of an inconvenience. But, by the same token, the approach the member might be suggesting would be simply impossible to administer.

Mr. McKessock: Mr. Speaker, on a point of order: As well as being legal, should the notice not be understandable?

Mr. Speaker: Order.

EMPLOYEE HEALTH AND SAFETY

Mr. Martel: Mr. Speaker, I have a question for the Minister of Labour with respect to Surrey Place, where children have been allowed to play with toys covered with asbestos, where workers are working without protective equipment and where cleaning staff has been cleaning up asbestos without the appropriate equipment.

Is the minister aware that members of his staff went in there on Friday and yesterday and did not even bother to consult with the president of the local, who was responsible for the investigation that went on?

Hon. Mr. Ramsay: Mr. Speaker, I am aware that members of my staff were there yesterday and the day before, and have been there quite frequently in the past number of weeks, but I was not aware they had not spoken to the officials of the union.

Mr. Martel: Is the minister aware that just yesterday a rehabilitation counsellor was instructed to clean up the dust in the outpatient area, given only a pair of rubber gloves, with no instructions on how to proceed and without a respirator? The cleaning staff have still not been told what type of equipment they should be wearing to protect themselves as they clean up this asbestos. The toy box where the children get the toys from is still full of asbestos.

Surely it is time the minister signalled to employers in this province that he will no longer allow these situations to occur and that he is prepared to prosecute to put an end to it once and for all.

Hon. Mr. Ramsay: The member has talked about prosecutions and orders. I would like to put on the record the fact that under the provisions of the regulations, since 1979-80 to March 31, 1982, more than 10,000 orders have been issued by the ministry. The ministry issues stop-work orders in situations where the workers' health is in danger and control measures are not in place. At least 1,100 such orders were issued in 1980-81. Finally, the ministry does prosecute offenders under the Occupational Health and Safety Act. In 1980-81, there were 234 cases prosecuted; the number rose to 390 in 1981-82.

AUTOMOBILE PURCHASE

Mr. Roy: Mr. Speaker, on a point of privilege: I am advised that the Minister of Tourism and Recreation (Mr. Baetz) -- the minister of good times, if we can call him that -- made an announcement last Friday to the effect that the Ontario Lottery Corp. would have draws for automobiles. In the process, he did not give any credit to my colleague the member for Windsor-Walkerville (Mr. Newman).

Mr. Speaker: Order. That is no point of privilege.

Mr. Roy: It is.

Mr. Speaker: Order. Will the member for Ottawa East please resume his seat? Thank you.

RADIO READING SERVICE

Ms. Bryden: Mr. Speaker, on a point of privilege: on June 7, I sent an open letter to the Premier, asking him to provide ongoing funding for the Radio Reading Service, which keeps visually handicapped people in touch with the world. I pointed out the urgency of the situation, because the service will close this week and all the employees are working without pay.

Mr. Speaker: Order. That really is not a point of privilege.

Ms. Bryden: I have received no reply from the Premier.

Mr. Speaker: I am sure the Premier will take note and will reply at his earliest convenience.

MOTION

STANDING COMMITTEE ON RESOURCES DEVELOPMENT

Hon. Mr. Gregory moved that in addition to its regular sittings, the standing committee on resources development in considering Bill 115, An Act to amend the Retail Sales Tax Act, be authorized to sit Monday afternoon and evening, June 28 and July 5, Tuesday afternoon, June 29 and July 6, and Wednesday afternoon, June 30 and July 7, and that the bill be reported back to the House before adjournment Wednesday, July 7.

Motion agreed to.

INTRODUCTION OF BILLS

FAIR PRICING ACT

Mr. Swart moved, seconded by Mr. Breaugh, first reading of Bill 153, An Act to provide for the Fair Pricing of Products and Services Sold to Consumers in Ontario.

Motion agreed to.

Mr. Swart: Mr. Speaker, the purpose of the bill is to require a fair price for every product and service sold to consumers in Ontario. Where a retail seller charges an unfair price, the bill sets out proceedings and remedies for ensuring compliance with the fair pricing requirements. The bill provides for an appeal of fair pricing orders to the Commercial Registration Appeal Tribunal.

I have three other bills to present.

CONSUMER PROTECTION AMENDMENT ACT

Mr. Swart, seconded by Mr. Breaugh, moved first reading of Bill 154, An Act to amend the Consumer Protection Act.

Motion agreed to.

Mr. Swart: Mr. Speaker, the purpose of the bill is to require that every product offered for sale bearing a product code must also be marked with its purchase price. The bill prohibits increases in the purchase price of a product above the price initially marked on it by the retailer. The bill also provides that if the price marked on the product differs from the price associated with the product code, the purchase price of the product is the lower of the two prices.

3:20 p.m.

AUTOMOBILE INSURANCE RATE CONTROL ACT

Mr. Swart moved, seconded by Mr. Breaugh, first reading of Bill 155, An Act to establish the Automobile Insurance Rate Control Board.

Motion agreed to.

Mr. Swart: Mr. Speaker, the bill establishes an automobile insurance rate control board that would have the power to approve and fix rates and to conduct public hearings dealing with rate increases.

MILK AMENDMENT ACT

Mr. Swart, seconded by Mr. Breaugh, moved first reading of Bill 156, An Act to amend the Milk Act.

Motion agreed to.

Mr. Swart: Mr. Speaker, the final bill of this series of consumer protection bills permits the Milk Commission of Ontario to determine prices at the retail level as well as at the wholesale level for milk, skim milk, buttermilk, flavoured milk and cream.

RETAIL SALES TAX

Mr. Martel: Mr. Speaker, I had a constituent who came to my office today from Sudbury who brought this Simpsons-Sears catalogue. She wanted me to send it to the Treasurer to use in his john. I wonder if I could get a page to put that on his desk so he will have it when he returns.

COMPENDIUM REQUIREMENT

Mr. T. P. Reid: Mr. Speaker, on a point of order: I had hoped this matter would have been resolved earlier, but I direct your attention to the standing orders, specifically 32(c), which states: "On the introduction of a government bill, a compendium of background information shall be delivered to the opposition critics. If it is an amending bill, an up-to-date consolidation ... " etc.

We are dealing this afternoon with some fairly esoteric and complicated bills, particularly An Act to Amend the Provincial Land Tax and others, and yet we received no compendium of information, no background studies, no reports on the impact of the passage of these bills.

Mr. Speaker, I hope you will draw it to the attention of the chief government whip (Mr. Gregory), who is the acting government House leader, and the cabinet minister involved.

ANSWERS TO QUESTIONS ON NOTICE PAPER

Hon. Mr. Gregory: Mr. Speaker, prior to orders of the day, I wish to table the answers to questions 96, 171, 182, 192, 211, 212 and 214 on the Notice Paper and the interim answers to questions 206 and 209 [see Hansard for Friday, June 25].

Before calling the first order, there is an understanding between the House leaders and the whips that any second readings we reach today, where necessary, can be stacked until 10:15 this evening. Is that agreeable?

Mr. T. P. Reid: Right.

Mr. Martel: Agreed.

ORDERS OF THE DAY

ONTARIO LOAN ACT

Resuming the adjourned debate on the motion for second reading of Bill 111, An Act to authorize the Raising of Money on the Credit of the Consolidated Revenue Fund.

Mr. T. P. Reid: Mr. Speaker, I may be wrong, but I believe I had the floor on this bill. I do have a few more comments left, and I know the Treasurer (Mr. F. S. Miller) would not want me to miss my opportunity to make them. However, I think I have given this bill a fairly thorough airing, although there are other things I could say.

Just to reiterate what I said before, we will not be supporting this bill. We are not happy with the way the Treasurer has taken what we consider to be undue advantage of some of these pension funds.

I would just like to wrap up my short, pithy and concise remarks on this bill by --

Hon. F. S. Miller: Short and pithy?

Hon. Miss Stephenson: You have got to be kidding. Pithy it has not been. Concise it has not been.

Mr. T. P. Reid: Pithy? I am sorry the minister's lisp is confusing me.

However, in relation to Bill 111, I would like to end it with a small ditty, which I think pretty well sums up the principle behind this bill.

Hon. F. S. Miller: If you are writing a ditty, all I can say is pity.

Mr. T. P. Reid: It goes like this:

The net cash requirements are high,

But Frank Miller continues to sigh;

For $2.2 billion he will tax 8.6 million,

For those puppies and that large pizza pie.

The Deputy Speaker: Either you are shocked or you are not. The member for Windsor-Riverside.

Mr. T. P. Reid: Be brief, eh?

Mr. Cooke: Yes, I will be brief. I am sure I could have summarized what the member said in 10 hours in -- well, he summarized it very well in the past three minutes.

Hon. Mr. Ashe: He said about the same thing. I agree.

Mr. Cooke: The minister and I agree on something. But I am not sure I want to agree with him on anything, even if it is classifying the speeches of the member for Rainy River (Mr. T. P. Reid).

Mr. Speaker, I want to make a few comments on this bill. I will begin by pointing out that this caucus will not be supporting Bill 111l. To support this bill would mean that this caucus would be supporting this government's priorities, and certainly we cannot do that. I do not think there has been a budget in the five years I have been here that has been so mixed up, confused and totally wrong in its priorities as this one is.

It is one of the examples of this government's investments. It is the position of this party that any kind of borrowing done should be viewed and used as the investment part of a provincial budget. I do congratulate the Treasurer (Mr. F. S. Miller) that in this budget he did accept that one principle. I am not sure he accepted it because he deeply believes in it. I think he accepted it more because he was trying to react to the right-wing approach of some sectors of our community on the government deficit problem.

However, I do not think the overall deficit of the provincial government in Ontario is a problem. It is about 10 per cent of its overall budget or its borrowings to meet the requirements on a yearly basis. I do not think that presents a serious problem. My friends to my right consider that to be a problem. I agree that at the federal level we are getting into a somewhat difficult situation with a $16-billion to $18-billion deficit.

When we take a look at this government's priorities under its budget, we have to come to the conclusion that this bill is unsupportable. Programs such as the renter-buy program do nothing to help the people who need assistance. Today, my leader spelled out the nation-wide statistics on how many people have qualified for the federal mortgage assistance program, and it is obvious the program is not working; it is obvious that people need assistance but are not willing to use the federal program because of its restrictions.

3:30 p.m.

As our task force has been going across the province we have been told by bankers and by unemployment help centres that the federal program is too restrictive and is not meeting the need at all. Last week, when we were in Windsor, we were told that only one trust company in the city of Windsor was even using the program. The fact is that when you defer interest, as you do under the federal program -- and that is the part of the program you qualify for if you have equity in your home -- at the end of the year you will have less equity in your home than you did at the beginning of the year.

So this government certainly has a responsibility, and the fact that it has decided to help those people who need no help to keep their homes rather than those people who need help shows the government's priorities.

When one looks at investments one also has to look at what happened with Massey-Ferguson a year or a year and a half ago when the government came in and, rather than invest directly in Massey, decided to guarantee shares. At the time, they said that it was a cheaper way of doing it and they would rather take the risk by guaranteeing other people.

I am looking for the press clipping, but I do not have it in front of me. The fact is that just a couple of weeks ago when Massey paid no dividends on the preferred shares --

Mr. T. P. Reid: This is not on the principle of the bill.

Mr. Cooke: It is on the principle of the bill since we are talking about an investment. It is much closer to the principle of the bill than the member was.

The Deputy Speaker: On a point of order the member for Rainy River (Mr. T. P. Reid) has pointed out that it is not on the principle of the bill.

Mr. Cooke: That's right.

The Deputy Speaker: However, talk about who is calling the kettle black.

Mr. Cooke: That's right.

Mr. Speaker, we are talking about government investments, and the government has referred to their borrowings as the section of their budget that is an investment budget. I just want to spend a few minutes talking about that.

A year ago, the government indicated that Massey-Ferguson was not an investment it wanted to get directly involved in. Now that the government has been forced to do that because the preferred shares are not receiving the dividends and Massey is going to invoke its right with the Canadian Imperial Bank of Commerce and the other banks that are involved to force the federal and provincial governments to buy up those shares, we see quotes in the paper by the Minister of Industry and Trade (Mr. Walker) that Massey is, in fact, a very good investment for the government. The inconsistency on the part of this government when it comes to investing, creating jobs and creating wealth is very obvious in that there is no investment strategy whatsoever.

Another aspect of this budget that should be an investment section of the budget is the small business tax expenditure. The Treasurer indicated that this $250 million in forgone revenue, which does contribute to the deficit, will mean that 10,000 jobs will be created. But our task force has now visited with several chambers of commerce as well as small business groups across the province. Without exception, they have indicated to us that this tax expenditure, this small business tax giveaway, is not going to help them at all. No small businessman in his right mind would take the money that is saved -- the taxes he will no longer have to pay to the provincial government -- even if he is in the fortunate position of being incorporated and being profitable, and reinvest it to create jobs. That simply will not happen in our economy today.

Why would anyone invest in an economy that is going downhill so quickly? Why would anyone invest, whether he is in manufacturing or in the service sector, when the demand does not exist?

What we need in the small business sector -- and we will get to this bill later today -- is a strategy to help those small businesses, especially in the very hard-hit communities. And the number of these communities is growing; there are many more hard-hit communities in Ontario now than there were a year ago.

Sault Ste. Marie,for example, can be considered to be in the midst of a depression, as were many southern communities a year ago. The government should have developed a program to help those communities and the small businesses in those communities so they could avoid bankruptcy. Instead, we are going to lose 18,000 to 25,000 jobs in the small business sector because this government has this philosophy of helping only the winners.

A real government investment strategy would have involved a serious approach and a serious strategy in the areas where we need investment to attack the problem of imports. When we look at machinery, we see a deficit of well over $10 billion. In some silly areas where we import, such as $210-million worth of hand tools and $119-million worth of power tools, these are areas where, whether it be mining machinery or the types I have mentioned, there is demand here in Ontario.

A government investment strategy to create jobs could have taken advantage of those opportunities, created thousands of jobs, created wealth and contributed to the elimination of unemployment. Instead, the policy adopted in the budget contributes to the problem of unemployment by doing nothing to save jobs and doing little, if anything, to create jobs.

This province continues to follow a strategy of more foreign investment which will mean more of an outflow of capital and which will also drive up interest rates.

Mr. T. P. Reid: He is not talking to the principle of the bill.

Mr. Nixon: I think you should get up on a point of order.

Mr. Cooke: I think this is much more related to the principle of the bill than the member's 10½ hours of speaking which seemed like 30 days.

Mr. T. P. Reid: Mr. Speaker, on a point of order: The member is not speaking to the principle of the bill. You were in the chair for a good part of my comments. You know I was always talking about the public debt and the borrowing necessary to service that public debt. I submit to you my remarks were on the principle of the bill and I suggest the member should stick to that.

The Deputy Speaker: I have been listening closely --

Mr. Foulds: Mr. Speaker, on the point of order: I can assure you and other honourable members of the House that my colleague from Windsor-Riverside will be as true and as accurate, and will stick to the principle of this bill, equally and in as parallel a way as the member from Rainy River did in his previous speeches.

The Deputy Speaker: The chair will allow a few minutes warm-up as it were.

Mr. Cooke: As I said, we are talking about an investment strategy. The budget points out that the borrowings involved in this budget are part of this government's investment strategy that its operating budget is a balanced budget. Therefore, I think the comments I have made so far are quite in order.

I only have a couple more comments to make. We have talked about a government investment strategy and we have talked about the responsibility of this government to create jobs. I guess the most disappointing long-term prognosis for this province, as a result of the budget that came down on May 13, is that this government still does not understand it does have a role to play to create wealth and to create long-term, permanent jobs in Ontario.

The government continues to indicate that the recession, and in some areas of the province the depression, that exists at present is a cyclical downturn in the economy. We know better than that. We know from the statistics coming out on a daily basis that things are getting worse. We know what Liberal interest rates are doing to the province and to this entire country. I can understand why the member for Rainy River does not like to talk about those types of things. He does not like to talk about the effects of Liberal interest rates on the economy of this province.

In this party, we recognize that, sure, the Liberals at the federal level are wrong. The people of Hamilton West recognized that last week and more people will recognize that come the next election.

We recognize that, but we also realize that the Treasurer and this government have a responsibility and must recognize that the stubbornness of the federal government is such it is not going to change its philosophy or approach. We in this province are on the brink of disaster and there must be an industrial and investment strategy developed.

The moneys we are borrowing in this budget and the wealth that could be created with those moneys must be used in a long-term strategy, not just to pay off day-to-day expenses or to pay for silly investments, such as in Suncor, the $10 million jet or the transfer of incredible amounts of money to the most wealthy in the province, such as the doctors.

Those kinds of strategies, those kinds of transfers do nothing for the long-term economic health of this province and that is why we intend to vote against this bill.

3:40 p.m.

Mr. Bradley: Mr. Speaker, in speaking on this budget bill, and in recognition of the fact it allows members of this Legislature an opportunity to discuss budgetary matters in a rather general way, I must commend you on permitting members to do so, particularly the member for Rainy River (Mr. T. P. Reid) who spoke so eloquently.

Hon. F. S. Miller: On a point of order, Mr. Speaker: I do not think that was ever accepted as a privilege in this case. I repeatedly pointed out the bill was to be spoken to in detail in this area.

The Deputy Speaker: The member for Rainy River brought to our attention that at all times he spoke to Bill 111.

Hon. Miss Stephenson: He did?

The Deputy Speaker: That is what he said.

Mr. Cooke: On the point of order, Mr. Speaker: The debate on this bill went on for 10 hours with 90 per cent of the comments made by the member for Rainy River, which were completely irrelevant when it came to Bill 111.

Mr. T. P. Reid: That is not true.

Mr. Cooke: The debate on this bill will be over shortly so let us not be silly on how we are going to rule on it. The Treasurer, who sat there and listened to the irrelevant comments by the member for Rainy River, did not make any objections.

Hon. F. S. Miller: I did.

Mr. Cooke: The Treasurer sent things across the floor but he made few points of order.

Hon. F. S. Miller: With respect, I asked for a ruling on at least three occasions. I thought the comments of the member for Windsor-Riverside (Mr. Cooke) were right on the mark and I commend him for them. I was just asking the chair to rule.

The member for St. Catharines (Mr. Bradley) started out by saying there was a general discussion of budgetary policy permitted. It was my understanding that was not the case. I did not want that to be construed as being so at this point. I would he quite happy to have him talk to the bill. Any member of this House has that privilege. I accept that. I simply would like us to recognize we have made some agreements and I would hope we are sticking to principle.

The Deputy Speaker: Taking the suggestion of the member for Windsor-Riverside, let us get on with it.

Mr. Bradley: That is fine. I can speak for any length of time as well if one is to address the exact and precise measures contained in the bill. If that is the attitude that is wanted, then that is exactly what I will do for a period of time.

To go back to this bill, members of this Legislature want to stand on behalf of their constituents to speak on their behalf about the budgetary policies that have required this government to raise $2.5 billion for this particular year.

Many people in our area of the province are very concerned, for instance, about the automotive industry and wonder, when the government is borrowing $2.5 billion for this fiscal year, why more of the programs and projects which are involved in this budget do not directly assist those who are adversely affected by the downturn in the automotive industry.

When a Treasurer brings in a budget which takes money out of the pockets of the consumers of this province in many ways, we feel that it leaves less money to be spent on products such as automobiles. I am sure those who represent areas where other consumer products are not being sold at the rate they were in the past would express the same concerns.

This government points its finger at the federal government for action and, indeed, the federal government does have a major role to play in alleviating the problems of the automotive industry. But this government had the opportunity to do the same thing with the money, the $2.5 billion, that has to be borrowed in this fiscal year.

We look at some of the expenditures made by this government with the money that has been raised and question those expenditures quite legitimately.

On many occasions, both in committee and in the House, we in the opposition have expressed genuine concern about the amount of money spent on advertising by the government, advertising which, in many cases, we feel is blatantly political and excessive both in terms of the cost and the frequency of the advertising.

I suggested in a question to the minister that the amount of the borrowed money he would be spending on advertising could be reduced by as much as two thirds without causing any problems for the government, and I maintain that recommendation.

I also think of land-banking schemes; a townsite at a place called Townsend where a considerable amount of money has been spent by this government -- "squandered" is the term I might use. Though one might say that is political, there are many people who have viewed that expenditure with a good deal of concern and would agree with my contention.

We also say that money is being borrowed for the purchase of a number of shares in Suncor. For many months, we in the opposition have expressed our strong opposition to this purchase. This has been based mainly on the fact this government was not forthcoming with all the information that would have been useful to us in making a judgement as to whether or not it was a reasonable investment. From the information the government has provided to this time, we feel it is a misappropriation of those funds which this government has to borrow.

Something else for which the government will have to borrow and which we feel is definitely an example of extravagance and unnecessary expenditure -- and I say this knowing it has been a matter of jest many times in this House -- is the aircraft which is being described by some as an air ambulance or as a backup air ambulance. But, in our view, it is primarily for the purpose of transporting the Premier, the members of the cabinet and senior government officials, in relative luxury, certainly in efficiency and comfort.

We feel that borrowing money for that expenditure is not reasonable on the part of this government. We would be far more supportive if the government was borrowing money to do things which we feel would affect the average individual in this province in a positive and direct way. Many of us have probably received more letters and telephone calls on this budget and on this subject than on anything else which has come before this Legislature, or which has been a matter of interest in the provincial media.

One of the problems for an opposition in a legislature such as the Ontario Legislature is that most people focus their attention on the national scene. No doubt there are some people in this province who think the sales tax and the increase in the Ontario health insurance plan premiums are a result of the transgressions of the federal government.

Even though this works to the advantage of the government, you will appreciate, Mr. Speaker, as a representative from outside Metro Toronto, and as an individual who is interested in provincial politics you would recognize, that when the focus of attention is on the national news and national items, whether the federal government is doing a good or bad job economically, that is where the interest is centred.

The same could be said of the newspapers. Most newspapers carry international or important local or national news on the front pages. To read about something that happens in the Legislature -- for instance, in my own newspaper, the St. Catharines Standard -- one often has to look at the back pages. And if it concerns the member for St. Catharines, one would have a hard time finding it even there. My friends on the other side would say, "Justifiably so," but I would disagree.

Even though there is not much focus of attention on provincial issues, this special subject, the provincial budget and this bill, are of great interest to my constituents. Certainly students would agree with the Ontario Federation of Students who talk about the budgetary measures which would adversely affect them, particularly the sales tax. There would be others affected as well.

For instance, a headline in the St. Catharines Standard, referring to the town of Lincoln, says, "Ontario Tax Bite Said Dirty Trick." The new member for Lincoln (Mr. Andrewes) would have a good many friends in that town, but we have a budgetary measure of which the opinion of the town of Lincoln, where there are many friends of this government, is not particularly favourable to this government.

I look at the Lincoln County Board of Education which admonishes this government for its budgetary measures. They would have hoped that if this government was going to borrow $2.5 billion under the provisions of this bill it would not have had to go to the Lincoln County Board of Education and take seven per cent in sales tax in areas where it had not been applied before, thus creating budgetary problems for the board.

3:50 p.m.

I have a constituent in St. Catharines, by the name of Jerry Burke, who is in the doughnut business in Fonthill. He recognizes there are great complications in that tax. We have discussed this many times in the House with the Minister of Revenue (Mr. Ashe), and opposition members have asked him specific questions about it. Jerry Burke would certainly think that problem could be ironed out and that when the government borrows money, it should not have to take money from his particular business. He feels it is being treated differently than one of the large doughnut chains which appears to be getting away with something his company cannot get away with. I have advised him to bring that directly to the attention of the ministry.

Petitions have been presented to the Treasurer from York Cleaners and Reid Cleaners in St. Catharines on the application of his tax as it relates to repairs and alterations to clothing done by cleaners. A number of people have justifiably expressed concern about that because this hits hardest at people with low and fixed incomes.

Mr. S. Bodis, of 32 Ted Street in St. Catharines, is very concerned. He is 67 years old and has never before called an MPP with a complaint, but he considers the sales tax on food, even a cup of coffee, to be "a dirty, rotten thing."

Many people are protesting this time and again. Mr. John Heidebrecht, of 301 Linwell Road in St. Catharines, is protesting the retail sales tax additions to the budget. He wanted the Treasurer's address and we gave it to him. I presume the minister will be answering him. Mr. Heidebrecht grossed only $7,000 in his business and he does not know how much longer small businessmen will be able to keep going.

These are everyday people. These are not those of us in the Legislature who are insulated from these problems to a great extent by the fact that many of our expenses are looked after and we get a rate of pay that is more favourable than that of many people in this province.

I see the Minister of Natural Resources (Mr. Pope) is here. He has a difficult ministry to handle and I know he is making an effort to handle that ministry in the best way he knows how. However, Reverend Fred Fletcher, of Scott Street in St. Catharines, worries that because of expenditures in other areas, senior citizens now have to pay for camping in provincial parks on weekends. I know that is not an easy question to wrestle with and I do not want to be partisan and tear the minister apart on it, but when individuals see how the government is spending its money yet senior citizens are now required to pay a fee in a provincial park, they are very concerned and I bring that to the attention of the government.

I have a letter from Reverend Alan Bennett of the First United Church in St. Catharines. This letter went to the member for Brock (Mr. Welch) concerning the provisions that would adversely affect churches and the work they do. In the interest of time, I will not go into detail except to note the letter has gone to the government and concern has been expressed.

The Lincoln County Roman Catholic Separate School Board wanted to notify the Treasurer of the injustice in the new budget with respect to taxes being imposed on taxes, specifically the tax on school supplies and school building materials. They went into some detail on this. Once again, I would not read it into the record unless I were involved in an exercise as my friend the member for Rainy River (Mr. T. P. Reid) was some time ago.

The Board of Education of the Borough of York expressed the same concerns, as did some individuals in the provincial constituency of St. Catharines.

Mr. Ron Kane who operates Kane's Coffee and Vending Services is concerned about how vending machine operators are going to be affected by the budget. In his telephone call to me, he went into great detail and asked me to bring this to the attention of the government.

Mr. Ron Brodeur, of Brock, is very concerned about the provisions of this budget. He is not the kind of individual who would normally phone a constituency office.

Miss Gail Blake is described as being absolutely furious with the budget, particularly with the unreasonableness of taxing personal items. She wanted to know if she could take up a petition and have it brought to the Legislature. On her behalf, I have taken that position and have taken the petition to the government.

Mr. Brent Winger, who operates the Brite Corner Restaurant in St. Catharines, Ontario, is concerned about the tax on food, and he got together a petition from the people who use his establishment.

Miss Cathy Rosenfeld, 52 Strathcona Drive, St. Catharines, thinks the tax on health and hygiene products is ridiculous and the Progressive Conservative Party is out of line in what it is doing. I could go into great detail and I have indicated why I am not reading holus-bolus, so to speak, but sometimes there are two pages of typing from my constituency office secretary to me on the detail people have gone into on this budget.

Mrs. Gracia Janes, 58 Grapeview Drive, in the riding of Brock is fully aware this is not my budget, but she thought she would call here anyway to register her annoyance with it. She talked about fast foods and school supplies and so on being taxed and expresses concern about that.

Mr. Alex Patterson talks about the budget and he wants me, as his representative, to bring to the attention of the government his concern about the additional cost to business people and the additional cost to consumers. Mr. William Widdowson --

Hon. Mr. Ashe: Don't forget to put in your order for all those Hansards you are going to be sending out.

Mr. Bradley: The Minister of Revenue talks about all the Hansards and indeed I will be sending out Hansards. Those people are looking for someone who represents them to bring their individual problems to the attention of the government. One of the great difficulties with governments today, and I say this not only to this government but to all governments, particularly at the senior provincial and federal levels, is that they have lost contact with the average individual.

When we think of facts and figures and numbers, we do not think of the effect on individuals. I really and truly believe that if the government had known the problems it was going to create by extending the sales tax, for instance, it would not have done it. I do not think it would have perpetrated upon the people of this province the transgressions it has through its budgetary measures. I do not think the government is really out to get the people of Ontario. I am not cynical enough to sit here and think it is out to get the poor or the people on low incomes. But, in effect, it has through its budgetary measures. That is why I am taking this opportunity to bring to its attention the problems of individuals within our communities.

The Deputy Speaker: Speaking of opportunity, I would like some guidance from you. I have let you go on at great length and I see you have a pile yet, I guess, of particular people who have phoned in.

Mr. Bradley: Right.

The Deputy Speaker: With all due respect, I am looking at the bill, An Act to authorize the Raising of Money on the Credit of the Consolidated Revenue Fund, and at its explanatory note. Having some semblance of reasonableness, I am wondering where your comments about the seven per cent increase in sales tax fit in to any of those categories. I do not want to have a big debate with you, but I think I have been fair in letting you go on at length on this. I am hoping you will be fair.

Mr. Bradley: Coming from this particular Speaker, I would like to accept that kind of admonishment. In my view, this Speaker has been very fair to the opposition and has allowed a good deal of latitude. I recognize our time confinements this afternoon.

I will simply say to you, Mr. Speaker, that I have received, as you have pointed out, and could read into the record if time were to permit, a number of individual complaints from people. In fairness to what you are trying to accomplish here this afternoon, I will cut that part short and simply say that when time permits, we, as representatives in this Legislature, will be bringing forward those problems which have come to the members' attention on an individual basis, perhaps in the budget debate itself, if the general budget debate will allow us to do this.

I hope I have been able to touch on some of the problems people see. We recognize why the government is borrowing. We disagree with some of the areas. We agree with some of the areas. We happen to agree that some of the things the government is going to be spending that $2.5 billion on are valuable. But when I look at its budget, I would say that for a government that prides itself on being good in terms of financial management, it is running a huge deficit.

As such, I do not object to deficit financing. because our present times call for deficit financing. We may disagree with some of the areas where it is spending the money and think the deficit does not have to be so large; nevertheless, I would not want to give the impression that I, as an individual, or many of the people on this side would deny that deficit financing is not a necessary tool to assist people in difficult economic times.

4 p.m.

I appreciate having had this opportunity to touch on a number of areas. I could probably go on for a couple of hours, but we have an agreement in this House that we will proceed somewhat more expeditiously than we have in the past. Those who want to make representations will have the opportunity to do so through a committee which we in the opposition have forced upon this government and which will not just deal with the bill but will also hold public hearings. It is a step forward, in my view, a victory on the part of the opposition for the people of Ontario, and with that I express great satisfaction.

Mr. Wildman: Mr. Speaker, I rise to participate in this debate with some degree of disappointment over the fact that we are discussing a bill for the raising of funds through borrowing by a government that apparently has very little idea, in fact is almost bankrupt of ideas, about what should be done to have productive investment in this province so that we can turn around the economic crisis that we face.

We see a government that is prepared to borrow $2.25 billion for the consolidated revenue fund, a figure which is about equal to its deficit, and yet we see a government that is unable, or because of its ideology is unwilling, to use deficit financing in such a way as to stimulate the economy of the province to provide employment at a time when we face serious economic downturns.

Hon. Mr. Ashe: Wrong.

Mr. Wildman: The Minister of Revenue says wrong. I have searched --

Hon. Mr. Ashe: Read the budget again.

Mr. Wildman: Since the minister raises the question of the budget I will say I have searched carefully in the budget for stimulation, for attempts to provide for employment development in the areas of the province that are facing serious problems, and I have found the budget wanting.

The riding that I represent in this House is the district of Algoma, except for Elliot Lake and the city of Sault Ste. Marie, which are not in my riding. However, the rest of the district is included in Algoma riding. I am informed that the unemployment rate in the district of Algoma and in the city of Sault Ste. Marie is running at 11.3 per cent. That is a record level, the highest unemployment level we have had in 20 to 30 years.

A minister of the crown sits in this House and says I am wrong when I say there is nothing stimulative about the budget. He says to read the budget again. We have looked at the budget. We know the budget predicts 31,000 temporary jobs. I am not certain if this borrowing is going to be used to help finance those temporary jobs, but it does very little, if anything, for the steel industry in Algoma riding and Sault Ste. Marie.

In the city of Sault Ste. Marie and the immediately adjacent area we currently have about 2,400 workers on layoff. That is the biggest layoff that Algoma Steel has experienced since 1954. Sault Ste. Marie, in April, had the largest number of people collecting welfare assistance that it has ever had. It was a record.

Most of them are people who have never before had to collect welfare. Many of them are people who have trades, who have had well-paying jobs in the steel industry, who have been laid off, who have gone to the Unemployment Insurance Commission, have had a long waiting period, have not been able to make it and so have had to seek welfare assistance. Those people who do qualify for unemployment insurance, when their vacation and UIC benefits run out in August or September, unless there is an upturn in the economy, will return to the welfare department and collect benefits that will place a tremendous burden on the city of Sault Ste. Marie.

There is nothing in the budget that even talks about those kinds of problems. There is nothing in the budget that stimulates the manufacturing sector, especially the auto sector, which would then spin off back to the steel industry and turn around the serious crisis we are now facing in that industry. The only reason there are not more people on layoff at Algoma Steel, the only reason they are not completely shut down, is that they are shutting down their ore division in Wawa in my riding for a full month this summer. The only reason is the upturn in the auto industry in the United States, which is related to the fall in fuel prices in that country.

The only other thing on the horizon that may assist Algoma Steel in preventing further layoffs and in perhaps calling back some of the workers it has already laid off is the apparently imminent collapse of the Sydney Steel Corp. and its inability to meet its obligations to Canadian National. If Algoma Steel gets that contract then things may turn up for Sault Ste. Marie.

Mr. Speaker, I do not know how you feel, coming from Markham. There was a program on the radio recently that compared Markham to Sydney, Nova Scotia. As a resident of Algoma district and of Sault Ste. Marie, I certainly do not feel very happy about a situation in which the continued employment of many people in my area of the province is dependent on the increased unemployment of the people of Cape Breton in the Maritimes.

There is no question that the main problem we face in our economy today is the high interest rate policy of the Liberals. The people of Hamilton West recognized this last week, but they also recognized that this provincial government has a responsibility to protect the residents of Ontario from the serious effects of the economic policies that are being followed in Ottawa. Those voters in Hamilton West, like most of the people in this province, recognize when they look at this provincial budget that this government has not responded to its responsibilities to protect those people.

The Minister of Revenue may say, "Read the budget again." I have searched the budget very carefully and there is nothing in it that does a thing for the manufacturing sector on a long-term basis. This government continues to argue that this is just a cyclical downturn, that things are going to look up in the fourth quarter of this year. The figures published just recently are first-quarter figures. We should not look at them and say things are serious; when we do we are accused of gloom and doom.

We should only think, "The second-quarter figures are not out yet; maybe they will be a little better." We should look to Ronald Reagan and say: "Things are looking up in the United States. The inflation rate is dropping there." That may be true, but we also must recognize that the United States has its highest unemployment rate since the 1930s, and if that is the kind of policy this government advocates for this country and for North America we are in for more and more layoffs.

4:10 p.m.

What response do we have from this government about the need to encourage investment? Do we have this government raising funds for direct investment in those parts of our economy that are suffering from import penetration so we can produce more jobs? No. Instead, we have a government which says the route to increased investment in our economy that will produce jobs on a long-term basis is more foreign investment.

It would have been laughable if it had not been so pathetic when the Minister of Industry and Trade (Mr. Walker) got up in this House and went on at great length about the future of the Ontario economy and how the Japanese had so much confidence in the economy of this province that they were going to invest at Elmira, and then he had to admit it was only nine jobs he was talking about. That was a big announcement.

Mr. Mackenzie: That was one of the biggies.

Mr. Wildman: Yes, he did not just get up and say: "We are happy that Sanyo is going to open a plant or a warehouse at Elmira."

Mr. Cooke: In three years, there are going to be 27 jobs.

Mr. Wildman: Oh yes, I forgot. In three years there are going to be three times that many jobs. That is quite a phenomenal increase if one thinks about it; a new plant and in three years they are going to have three times the number of jobs they will have when they initially open up.

The 27 jobs for Elmira is wonderful for Elmira. I do not downgrade that, but it does not do a thing for the economy of this province. If that is the only answer this government has to the economic problems of this province, then we are in serious trouble.

The Minister of Industry and Trade says he is a friend of small business. His friendship for small business is probably worth as much as his statements about his main role being jobs, jobs, jobs. He has produced jobs, nine jobs since he became minister, nine jobs in Ontario. I suppose the results of his efforts for small business will he the equivalent.

We look at the budgetary policy of this government and we know there is very little being promised to small business that could produce the jobs we need in many areas of the province.

There is no direct assistance for small business facing high interest rates. The minister touts the fact that he giving a tax holiday, and we will be talking about that bill later today, but he ignores the fact that one has to make a profit in order to pay taxes and the vast majority of small businesses in this province are facing serious difficulties because of the cost of carrying inventory, the cost of capital, and they are not paying taxes. This government has not proposed anything at all.

I might be more willing to accept and to support this bill if I had confidence that this government would use the funds it is raising in a positive, active way to invest in the economy and to produce jobs, but the record speaks for itself. This government still believes the main engine of development and growth in this economy is foreign investment. It is afraid and unwilling to take an active role itself.

This government still argues that since interest rates are a federal responsibility it does not have any real responsibility to take action to protect people who are suffering from them.

The Acting Speaker (Mr. Cousens): I would like the honourable member to tie his remarks into Bill 111.

Mr. Wildman: Mr. Speaker, I would accept the raising of funds under Bill 111. I would even accept a higher rate of borrowing if I had the confidence that this government was going to invest that money wisely. I am sure the Speaker would support that as well.

I met last week with a group of farmers in my riding and I did not know what to say to them. A number of the established farmers in the area are doing well, or not doing badly. They are facing high interest rates on their feed and fertilizer purchases and so on, but they are not doing too badly. But the young fellows in the room were facing the loss of their farms. There is nothing in this budget, nothing this government is doing to assist. They can paint their barns, put up new fences, make the property more attractive so that the buyer, if they can get one, may have to pay a few more dollars. That is the only assistance they get.

Because of the complete failure of this government to respond to the needs of the province to assist the manufacturing sector to become directly involved in investing in that sector, to assist the small business sector, to assist the farming sector, all of which are suffering because of the Liberal high interest rates, it is impossible for me to accept and support the budgetary policy and the borrowing policies of this government, since it does not invest in any way to help the province and stimulate the economy.

Mr. Haggerty: Mr. Speaker, I want to address myself to second reading of Bill 111, An Act to authorize the Raising of Money on the Credit of the Consolidated Revenue Fund. I question the additional $2.232 billion that is required to operate Ontario on a good, sound basis. If we look at the past record of this government, we have to go back to 1970, when this government was led by Premier John Robarts, to find the last surplus.

We can look at the mythology that has been used by the Davis government over the years from 1970 to 1981 and see the deficit that has occurred year after year. I have heard my colleague the member for Algoma (Mr. Wildman) blame the high interest rates on the federal Liberals. I suppose some responsibility can be put there, but much of the responsibility lies here with this government because of its deficit spending over the years. If anything is going to cause high interest rates, particularly in this government, it is the heavy expenditure in one of the large crown corporations, the corporate body of Ontario Hydro, borrowing money on the foreign market.

There is a comment in the budget about that. It says, "Borrowing limits: At times, the requirement for financing both public capital investment and counter-cyclical stimulatory measures, in conjunction with Hydro's capital needs, has placed pressure on the market's capacity to absorb new Ontario and Hydro bonds." That is a rather alarming paragraph. I suppose we could look at the record of Ontario Hydro bonds and notes payable in Canadian dollars. This is based upon its 1981 report. The figures are Canadian dollars $7,522,271,000, United States dollars $6,185,064,000, West German marks 75,992,000 and Swiss francs 56,724,000. The total borrowing of Ontario Hydro was about $200 million short of $14 billion in 1981. The alarming thing about this borrowing of Hydro on the foreign market is the interest rate. In 1981, bonds, notes and other debts ran at about $1,369,939,000, $200 million more than in 1981.

It is rather alarming that we have a crown corporation that is permitted by this government to get out of hand. At the time I served on the select committee dealing with the operations of Ontario Hydro we suggested that to it. I am sure that reports from experts across Canada, particularly from Ontario Hydro and other persons interested in economics, have indicated that Ontario Hydro could have got through with a 2.2 percentage growth in energy produced by Ontario Hydro. But they suggested running at 7.5 per cent, that this would meet the requirements here in Ontario for the use of electricity, including those of the consumers. So there was almost a good four percentage point difference.

4:20 p.m.

Now we find that this government had committed Ontario Hydro to go ahead and build the Darlington nuclear plant, and the expenditure that is going to be required for it is heavy. Sure, it may create jobs; but it is going to be too costly by the time we have paid the high interest rate, particularly when we borrow money offshore on the basis of the high American interest rates.

My colleague mentioned the Liberal policy of high interest rates. I suppose it would be good to follow the article that was in the Toronto Star the other day. One of the reasons we are paying high interest rates is that they are based on those of a country that does perhaps most of the lending of money to all the other countries throughout the world, and that is the United States.

If one has to go and lend money through the World Bank, backed by the United States, to Poland and Argentina, we are talking about billions of dollars. In a sense, if we follow the reports from the United States Congress, this is going to be almost a complete write-off; this money will never be paid back to the United States. So who in the financial world is going to absorb this loss? There is only one way they can perhaps gain some of that lost money back, and that is through high interest rates. We all have to pay for it if we want to help Third World countries and other countries that require loans to finance some of their expanding programs.

I do not think we can blame it all on the federal government or even on this provincial government, but I do suggest there is a problem in the Treasurer's 1982 budget with the additional deficit of well over $2.2 billion, which is going to require an enormous amount of financing at high interest rates. I suggest the Treasurer Mr. F. S. Miller) should have been looking more closely at this so we do not get ourselves into this type of predicament, which may well eventually break this province through the heavy borrowing that has gone on for the last 10 years.

I have to question where some of that money has been spent. In the 1982 budget, the Treasurer raises the matter of the funding for Suncor. In fact, last year they had to borrow $325 million to provide sufficient funding to help finance the Ontario Energy Corp.

I can recall a few years ago when we had a Treasurer who was concerned about the deficit route the province was taking. He always talked about finally bringing in a balanced budget, and that was former Treasurer Darcy McKeough. When he became Minister of Energy he invested -- I forget what it was; it was not very much money -- a few million dollars in the tar sands in Alberta, eventually sold it and made a profit of I believe around $25 million. The money looked good. By making a profit of $25 million in that investment, though, we are not going to see a profit in Suncor.

This province had an investment in the tar sands at one time with two or three other companies in Alberta, and I suggest this is just kind of window dressing now. I suppose if the Treasurer had really wanted to do something he would have invested in the much-discussed Arctic pipeline bringing all of that natural gas down to Ontario. Perhaps we could reduce the requirement for electricity, which has become more expensive than the price of natural gas should be in Ontario.

I suggest this province has got itself into serious financial difficulties that are going to cause real hardship for a number of industries in the province. If the government has to tap the money supply to run its business, there is very little of it left for free enterprise or for capital investment through the corporations that want to expand their industries.

This government is the one that has got us into this mess. The Treasurer talks about the new jobs it is going to create, and I have heard it for the last four or five years. All of these are temporary jobs for two or three months and then they peter out. We still do not have a program here which is going to create the long-term employment we are looking for. My colleague from St. Catharines read into the record some of the problems local municipalities will be facing today with the increase in the sales tax on certain items that were not taxable before.

I have a letter here addressed to the Treasurer from the city of Port Colborne.

"Attached hereto is a copy of the resolution of the Port Colborne council respecting the imposition of the sales tax on materials purchased by the municipality as provided for in the 1982 Ontario budget. Your consideration of the comments that our council has outlined in the said resolution would be appreciated."

The resolution reads: "Whereas the present state of the economy has forced citizens, private companies and governments to be very selective in their respective expenditures; and whereas the city of Port Colborne is faced with inflation which has a direct effect on the cost of providing essential service; and whereas the council of the city of Port Colborne has just adopted a bare-bones budget for city purposes which will mean a reduction of the level of services to the citizens; and whereas the 1982 operating budget adopted by council on May 10, 1982, does not provide for the payment of the seven per cent sales tax on materials purchased by the municipality; and whereas the payment of this sales tax may mean further reduction in essential services; therefore, the council of the city of Port Colborne respectfully requests the Honourable Frank Miller, Treasurer of Ontario, the Minister of Economics, to reconsider the imposition of the sales tax on materials purchased by municipalities."

A copy was sent to me. This will have some repercussions on the administration and the cost of hospitals and school boards. I believe I received a similar letter from the Niagara South Board of Education objecting strongly to the proposed sales tax on school supplies such as textbooks and other goods that are required to operate a school system.

I have a letter here from the Minister of Municipal Affairs and Housing (Mr. Bennett) and there is a paragraph in the letter that puzzles me. He is informing the public: "It is with great pleasure that I am sending you information concerning the new 1982 Ontario employment incentive program announced in the provincial budget on May 13. The program is intended to assist local governments to create jobs in this period of high unemployment and to accelerate the undertaking of repairs and renovations to public property. A total of $35 million is being made available and is expected to create 7,500 jobs between now and the end of the year."

The resolution from the council of the city of Port Colborne indicated that as long as the sales tax is going to be applied to building materials that were required to operate a municipality that is going to put further restrictions on the municipality. They are not going to go ahead with some programs to improve city services. If the city is renovating some municipal building or putting up a new workshed or something like that, we have a minister going the other way around who says, "Well, go ahead and we will give you additional funding to create the additional jobs." What they are doing is taxing the municipality with this additional tax on materials and goods that they are going to purchase this year, and then they are going to give it back to them in a piecemeal effort.

There is no need for this type of financial arrangement. There is no need for the Treasurer to go out and increase the sales tax on items that were exempted before. This measure of taxing them and then turning around and giving it back to them does not make much sense here. I think they should withdraw this particular section of the sales tax and restore the previous situation, where the municipalities were exempted when purchasing materials.

All they are doing is taking it from one hand and giving it back to the other, and the cost of the paper work alone will be expensive. I was looking at the Minister of Revenue's list of additional staff required to police this sales tax, to obtain the additional $200 million that is required by this government to operate. I suggest that both of them should withdraw this proposed increase in sales tax on certain exempted items.

4:30 p.m.

The half-baked measures the government has put forward to create jobs with this deficit spending of $2.2 billion are not necessary at this time. We have never seen any definite industrial strategy program to provide an opportunity for the many unemployed in Ontario to have long-term employment. This business of operating for six weeks at a time or something like that is not what a person is looking for.

The government could have moved into the area of subsidizing home owners. It has a program to provide some assistance through grants for first-time home buyers. That is the one where a home buyer is given a $5,000 interest-free grant for a period of 10 years. I do not think the government is going to get many buyers in that area unless they have incomes of about $50,000 or $60,000 to be able to pay the high interest rates. I think that program is going to be a complete failure. It may encourage some persons to get into the program by purchasing a home, but then they will find three or four years down the road that they cannot afford to pay for it as long as interest rates remain high.

Much of the problem with high interest rates in Canada is caused by offshore government borrowing. If the members look at the statistics that are available to us all, they will find that every province is permitted to borrow money offshore, particularly in the United States. In view of the present high interest rates, I believe all governments should not be looking at offshore borrowing at this time. The governments should be sticking more to the Canadian market. I am sure that through government programs, if they want to work it out, they can work it out so that money is available to them.

We are facing difficult economic times. I can recall in the Second World War they had economic difficulties while fighting the war. It was not a question of everybody hammering the governments at all levels; there were problems that had to be resolved. The knowledgeable persons got together and governments followed their directions.

At a time when we have an economic war in Canada and throughout the world, it is going to take some people with good heads who will have to sit down and forget the political side of things. They are going to have to tackle the problems facing us so we can go ahead and look for reasonable and affordable interest rates that all of us can live with. Money is going to have to be put back into the economy to create jobs.

The opportunities are there but it is going to take some initiative at all levels of government. All 10 provinces are going to have to work together to resolve the problems. The continuing bickering between one level and the other is not going to resolve the problem; it is going to compound it further. One can see it by some of the comments made here this afternoon. I am not here to defend Mr. Trudeau and his policies, because I think he and the governor of the Bank of Canada have been wrong.

Mr. Samis: Mr. Speaker, I want to speak briefly on this bill, especially in view of my location on the political spectrum as a right-wing New Democrat. I am not especially unaware of the consequences of deficits; they are a fact of life. I do not see them as particularly laudatory or as something worth shame or criticism. It depends on the actual situation. In some situations borrowing does not make sense; in other situations it obviously does.

I find it a little amusing that the Treasurer wants to borrow more money, and yet he is the same person who has gone around this province talking about his great aim of balancing the budget in that infamous year of 1984. My understanding is that since he has assumed that portfolio, he has never come close to balancing it. This year I think we have the largest deficit in the history of the province, from a Treasurer who said his great political goal in that portfolio was to produce a balanced budget for the province and to usher in Valhalla.

As a New Democrat, I find it amusing. If one compares the fiscal record of the past 10 years of the governments of Saskatchewan and Ontario, the NDP government in Saskatchewan, I believe, has produced five balanced budgets without having to resort to borrowing, whereas the Progressive Conservative government has not produced one balanced budget in the past 10 years. Here we are today faced with a bill requesting authorization to borrow yet more money.

I notice a certain parallel between this Treasurer and this bill and the situation south of the border. They have a President who goes around saying his great aim in life is to balance the budget, and yet he produced a record deficit, which is exactly the same situation we have in this Legislature with the Treasurer of this province: a record deficit from someone who promised a balanced budget.

If the purpose of the borrowing is to pay for a fiasco such as the Suncor adventure, obviously that is a waste of money. The people of Ontario agree that the Suncor adventure was a waste of money, a bad investment, and was not worthy of the government, the province or the people and something they would never have done if they had been given the authority to make that decision.

On the other hand, if the purpose of borrowing is to invest in a major housing program -- not one confined to gimmicky $5,000 grants but one that would apply also to tenants in this province and get the housing industry on the move -- then the borrowing does make sense, because that is a good long-term investment.

If the purpose of the borrowing is to pay for the jet, the advertisements or things of that nature, or to give more handouts to the private sector, I am opposed to that. If the purpose of the borrowing is to provide some form of interest relief for small businessmen who are being decimated by the high interest rates, or for home owners, obviously that will make a good investment for this province.

I find it strange that while a Conservative government in Saskatchewan thinks it is a good idea to invest in assisting people to retain their houses by reducing the mortgage interest rates to as low as 13.5 per cent, the Conservative government of this province does not think it is a worthwhile investment.

It is interesting that other provincial governments, whether they be Parti Québécois, New Democratic or Conservative, think it is a worthwhile investment to provide interest relief for small businesses so they can survive and cope with the crisis they are in. Somehow this government, apart from one budgetary measure contained in another piece of legislation, does not provide for direct interest relief to small businesses, whether they are incorporated or unincorporated.

The issue really is not the deficit. The issue is what is being done with the money that is being borrowed. Where are we putting it? Where are we investing it? We are wasting money if we are going to invest it in a sort of Board of Industrial Leadership and Development program -- which is an election gimmick of grants and, in some cases, outright bribes -- and get no equity in the companies we are giving the money to.

We are wasting money if there is no absolutely clear-cut industrial strategy upon which the grants are being based, and the BILD program is the perfect example of that. We are wasting money if there is no emphasis on Canadian content or priority in assisting Canadian companies with Canadian resources and Canadian development to try to keep jobs, research, development, technology, etc. here in Ontario. If we are not doing those things, then we are wasting money and this bill does not deserve support.

The whole thing is compounded, as one of my colleagues mentioned briefly, by the mushrooming cloud of bankruptcy, or whatever it is, produced by the Darlington development. The government tried to sell the people of Ontario on the idea that this, as a maximum, would be a $5-billion investment for the province. Leaving aside the question of energy forecasts and the question of nuclear versus non-nuclear, the simple fact of life is that now, at a time of record interest costs, we are talking in terms of a $10-billion investment for power we do not need.

Here we are, at a time of record interest rates, investing money on something we do not need and where the costs have more than doubled to 250 per cent above the original projections. Borrowing for programs like that, whether for Hydro, Suncor or some of the other investments of this government, I suggest does not make sense. On that basis, I will not support this bill.

Hon. F. S. Miller: Mr. Speaker, I shall be very brief. I want to comment on only a couple of the matters my friend the member for Windsor- Riverside (Mr. Cooke) talked about.

He mentioned visiting chambers of commerce around Ontario and hearing that no one believed the corporate income tax forgiveness for small businesses was of any use to business: "Why should people invest in Canada? What would any businessman in his right mind be doing with that money? He would not be investing in his business."

I simply say that I do not accept that as being true. I recognize that there are many problems in society. I recognize that many businessmen do not have any corporate income tax to pay because business is tough. I recognize that many of them are trying to hang on and that the last thing they are worried about now is paying corporate income tax. If one is trying to survive, tax is not normally the major problem.

4:40 p.m.

I buy all that, and I recognize that the actions I took did not help the person who is in a survival stance this year. I accept that. What I have to differ on is the belief that it is true of the great percentage of people in business. Many businessmen are not making the profits they would like to make, but they are still making taxable profits. Many businessmen are also confident enough in their own futures and that of this country, particularly in judging their own businesses and their growth, even in these bad times, to feel that reinvestment in the businesses they know will be productive. If we do not have that belief and that action by business people in this country, we are foreordained to the very troubles we talk about.

There is not much else they can do with that $250 million but use it in their businesses or pay tax. The alternative is that if they withdraw it, then they owe tax. If they withdraw it as a dividend or as salary, one form of taxation or another will come into force and we will get our share of that money. That is why I did not see myself as being generous in giving away a gift at monumental cost, because I hoped it would be a productive effort.

The member mentioned that I said some 10,000 jobs might be created. I have to admit that was a guess. I am asked for these figures at budget time or whenever a program like the Board of Industrial Leadership and Development comes out. It is interesting that my approximation of jobs created was only one fifth that given by the Canadian Federation of Independent Business when it was asked the same thing.

The other things I would like to refer to are two or three speakers' comments, mostly on the NDP side. They referred to our debt and the apparent mismanagement of the province. Every budget, particularly in its papers at the back, contains a wealth of information many of us never have the time to look at.

I would point out that chart C3 in budget paper C, page 32, shows "Months of Revenue Required to Repay Provincial Funded Debt, 1978-79 to 1982-83." I wish I could extend it backwards to the 1950s. It shows that consistently across those years, with the exception of this current year, we have reduced the number of months of revenue required to repay the provincial debt until it is now less than a year. Back in 1956 or 1957, it was some 21 months.

I also want to draw the attention of my friends to table C4, because a great deal has been said about the stress put on us by the federal government's reduction in established programs financing for health and post-secondary education. It has been alleged we really did not get a reduction in transfers.

The first line of table C4 shows that in 1981-82 we estimated we would get $2,044,000,000 in cash transfers from the federal government and only $1,979,000,000 in cash transfers in 1982-83. I am told that since that was printed the figure probably has been reduced by some $200 million because of an error made by the feds in previous years.

That is fair enough. I am not calling foul. I am just pointing out that, contrary to what many reporters and others claim, the reduction in cash transfers in nominal dollars was real, not imaginary. It was not just a reduction in the amounts expected, but in fact with an increase in dollars. It was a reduction in total dollars transferred, and we know those dollars are buying about 11 per cent less than they did the year before.

I also point out to my colleagues that on page 10 of budget paper C, "Public Investment and Responsible Financial Management," table 4 shows the total spending, the capital investment and the net borrowing of the province.

One thing I want to look at which is not in the table is the percentage of total borrowing as a percentage of total spending. This shows we borrowed approximately 14 per cent of spending in 1972-73, nine per cent in 1973-74, nine per cent in 1974-75, 18 per cent in 1975-76, eight per cent in 1976-77 --

Mr. T. P. Reid: But your interest payback in real dollars has increased.

Hon. F. S. Miller: Just a second now -- 11 per cent in 1977-78, about 12 per cent in 1978-79, seven per cent in 1979-80, six per cent in 1980-81, seven per cent in 1981-82 and just under 10 per cent this year. I put the percentages in because, in a world where 1975 dollars bear no quantum relationship to 1982-83 dollars, we have to go to percentages to gain a realistic approximation. I think it is only fair to have us look at it.

Mr. Nixon: Which page are you on?

Hon. F. S. Miller: I am on page 10 of budget paper C, table 4. It is at the end of the papers, the last paper in the book.

Mr. T. P. Reid: Nine cents of the provincial tax dollar is going to service the debt, and the year before it was seven.

Hon. F. S. Miller: I am not arguing that either. I am simply pointing out that the country of Japan is running a 40 per cent ratio for its borrowing relationship. I am not saying that is good or bad.

Mr. Wildman: That was exactly the point our leader raised when we made our budgetary suggestions.

Hon. F. S. Miller: Okay. But the members opposite should not criticize me for overspending, or whatever I am doing, if they are going to say I should have a bigger deficit.

Let us look at the relationship of borrowing to investments. If members look down these years, they will see in 1972-73 we invested $1.1 billion and borrowed $1 billion. In 1973-74, we invested $1.2 billion and borrowed $0.7 billion. In 1974-75, we invested $1.4 billion and borrowed $0.9 billion. In 1975-76, we invested $1.60 billion and borrowed $1.97 billion; that is one of the years where we actually borrowed to run the province. In 1976-77, we invested $1.48 billion and borrowed $1.09 billion. In 1977-78, we invested $1.5 billion and borrowed $1.5 billion -- slightly less but still very close. In 1978-79, we invested $1.3 billion and borrowed $1.7 billion; that is another year --

Mr. T. P. Reid: And who became Treasurer that year?

Hon. F. S. Miller: I became Treasurer that year.

Mr. T. P. Reid: That's when you started to borrow for current costs.

Hon. F. S. Miller: I was not the Treasurer who wrote the budget that year. That was not my budget.

Mr. Wildman: So it's all Darcy's fault.

Hon. F. S. Miller: In each of the years I have been Treasurer, for the information of members, the investments -- and they show in the balance of the table -- have exceeded the borrowings. Most companies in this world that are able to pay not only for all their costs of operation but also for part of their capital investment would say they have made a fairly substantial balance sheet. Municipalities, which by law cannot have deficits, are allowed to borrow for capital works: they are able to debenture. So I suggest to some members opposite that the gloom and doom they have tried to portray, when they say simply that the borrowing exceeds the capacity of the province, that the borrowing is for current account, is not correct.

Mr. Nixon: What about the ratios? You changed the ratios.

Mr. T. P. Reid: You keep changing the way you do your accounting.

Mr. Nixon: Gross provincial product; that's the one you used to use.

Hon. F. S. Miller: Mr. Speaker, I have been extremely quiet in my chair all this time and I would appreciate that in return.

Mr. Nixon: It would never go over nine per cent.

Mr. T. P. Reid: Remember what I said about smoke and mirrors.

Hon. F. S. Miller: How would members opposite explain the Liberal policy of a 23 per cent cost of their deficit? Look at the feds. I have trouble with Liberals who say: "We are not Liberals like they are somewhere else. We are Liberals who would be financially responsible." I have trouble --

Hon. Mr. Elgie: A Liberal is a Liberal is a Liberal.

Mr. Nixon: We are talking about Ontario. if those birds are in trouble, that is their fault; it is not your fault. But you changed the ratios.

Hon. F. S. Miller: I want to touch on one final point, Mr. Speaker, and then I am through. My colleague the member for Algoma asked what I did for Sault Ste. Marie. I strongly recommend that he go and talk to some people in the steel company; be they his friends or enemies, I do not know. If there was any industry I singled out in my budget for what I believe was an important change, it was the steel industry: first, in the treatment of its resource depletion allowances so that it would make it profitable to keep those mines he talked about functioning, because the feds' tax ruling made them unprofitable -- I hope he agrees with me on that -- and, second, in the change in the capital cost allowance, to flow the cash to allow the company to put the investment in that plant to keep it modern, up to date and one of the world's most efficient steel mills.

I do not know any other way of securing the jobs of the people he talked about who are temporarily out of work because of plant shutdowns caused by underdemand, but I assure members that our steel companies in Canada have been a model for other Canadian industries in keeping up with technology and keeping the investment level to the point where it assures jobs.

4:50 p.m.

I did not win a vote with the $135 million we put out by not paralleling the federal moves. It was not a political decision at all; it was an economic decision recognizing that it was not going to win me a vote and that I would take a lot of flak for the things that did raise revenue. I suggest that in a year when it would have been easy for me to avoid a lot of political flak I could have taken the easy route, which in the long run would have destroyed jobs. I did not. I took the route that I believed in the long run was right, even though in the short run it was politically uncomfortable.

The triple-A rating of Ontario remains the best measure of the financial propriety with which this province is managed. I hope this bill will receive second reading.

The Deputy Speaker: All those in favour of the motion will please say "aye."

All those opposed will please say "nay."

In my opinion the ayes have it.

Vote stacked.

PROVINCIAL LAND TAX AMENDMENT ACT

Hon. Mr. Ashe moved second reading of Bill 113, An Act to amend the Provincial Land Tax Act.

Hon. Mr. Ashe: Mr. Speaker, this bill to amend the Provincial Land Tax Act will implement the proposals in the Treasurer's budget of May 13, 1982, as well as other administrative amendments. This act deals with the assessment and taxation only of property located in unorganized areas.

The existing rates of assessment on pipelines, which are generally one quarter to one fifth of the rates established under the Assessment Act, will increase effective January 1, 1983. The current schedule of rates for pipeline assessment will be replaced by one schedule for gas pipelines and one for oil pipelines, both corresponding to the schedules used for municipal taxation as set out in the Assessment Act. The new schedule for gas pipelines will be slightly higher than the rates of assessment provided for oil pipelines.

At this point I wish to advise the members that I shall be referring this bill to committee of the whole House to propose several amendments which are for the most part designed to more closely parallel property tax assessment under the Assessment Act.

First, in certain areas of the province gas pipelines are being installed using pipe of 42-inch diameter. I am therefore proposing an amendment to subsection 6(1) of the bill to include that size of pipe. That apparently is a new size of pipe that was not in use before.

Second, I am also proposing amendments to subsection 6(2) of the bill. One amendment will provide for depreciation in the assessment of pipelines in unorganized areas at the same rate as that used in organized areas. In addition to the review of rates already contained in the bill, the second amendment to this subsection will allow me to conduct a triennial review of the year up to which depreciation will be allowed. The third amendment to this subsection will allow a reduced rate for a second or any subsequent pipeline where two or more pipelines occupy the same right of way.

Last, an amendment to subsection 19(1) of the bill will provide the authority to make the necessary regulations to support the amendments I have just described.

Returning to the content of the bill before us, the assessment and taxation of telegraph and telephone lines and equipment will be discontinued effective January 1, 1983, and telegraph and telephone companies will have to pay a new annual tax equal to five per cent of the total gross receipts with respect to the business carried on in a territory without municipal organization.

In addition, the bill contains a number of administrative amendments designed to parallel provisions contained in the Assessment Act and the Municipal Act. The bill clarifies that the provincial land tax is to be payable by the owner of the land and not by the tenant, that tenants or occupants of crown land are no longer deemed to be owners and are liable to pay the tax as tenants, and that the notices of assessment are to be sent to both the owner and the tenant of the land.

The bill increases the penalty payable on unpaid taxes to 10 per cent from five per cent, the minimum being $6, and provides that the rate of interest payable on overdue accounts will be regulated, together with the rate of interest payable under the revenue statutes effective April 1, 1983, when the present six per cent rate will be increased to the standard rate being regulated at that time. I might say that is the standard rate that applies to all tax sources.

As a matter of simplification, the bill removes the obligation of the owner to notify the tax collector of improvements to the property or change of ownership, recognizing that the maintenance of the tax roll is the obligation of the ministry rather than of the taxpayer. The bill provides for collection remedies such as garnishment proceedings and warrants of execution for unpaid taxes.

Mr. T. P. Reid: Mr. Speaker, we will be supporting this bill. We find some of the provisions very interesting and we do not quarrel with the fact that the assessment rate should be the same in terms of the organized areas as the unorganized, because that money is going to go into the provincial coffers.

I mentioned earlier in the day that we had expected we would have a compendium of information provided along with these bills. The answer I received was that the government considers the budget itself is a compendium. I put to you, Mr. Speaker, that this is not the case. If you look at page 31 of the budget, you will find some of the matters dealing with this bill are outlined in three short paragraphs. There is the amount of dollars we are talking about. We are perhaps not quite as concerned about the administrative changes as we are about the details of the bill, but I suggest most strongly we should be provided with an indication of the impact of these bills.

I have some figures before me that indicate what has happened is that between 1980 and 1981 the amount received by the Ontario Treasury in regard to these taxes was roughly $2.2 million. With this change in 1983 that is going to double to $4.4 million. In the space of two years, the amount the Treasury realizes will double. These are figures we tried to work up from the information we have. One presumes these corporations, which in most cases are monopolies, such as gas companies or telephone companies, are presumably going to increase rates to pay for this new, higher level of taxation. It seems to me we should know what the implications of these bills are going to be.

We are also concerned about the fact there are a number of amendments so soon after the bill has been introduced. We understand the one in regard to the size of the pipe; obviously, we have no problems with that.

We really feel more information should be provided in a bill such as this, but we have no serious objections to it. There are some points we will probably make in committee; for instance, about the size of the penalties imposed if the taxes are not paid by the land owners or the putative land owners. We are not trying to be overly punitive but, when interest rates are around 20 per cent, a penalty of 10 per cent still gives a 10 per cent cushion to those who have not paid and is not much incentive to pay the tax.

I believe it has come up in public accounts committee that in these various government requirements for revenue bills, whatever they be, or on outstanding loans, the interest rate charged as a penalty for late payment or for not paying should be somewhere around the current market rate to provide an incentive, shall we say -- or perhaps a disincentive if one likes -- but certainly an incentive to pay these taxes.

5 p.m.

As I have said, the Liberal Party will vote for the principle of this bill but we do wish we could be provided with a little more information on the effects of it.

Mr. Breaugh: Mr. Speaker, we will oppose this bill. Perhaps it requires a bit more explanation than the normal process that we, in general, oppose the budgetary policies of the government. A little more specifically then, we will oppose the bills that implement the policies of the government.

I want to say as well that it is often very difficult. There are rules in this House which were designed to provide to all members, and particularly to opposition critics, the kinds of reasons for governments proposing legislation, the ramifications of that and the background information leading up to legislative changes.

As the previous speaker pointed out, I suppose one could say the government is living up to the letter of the standing orders by providing us with pieces of paper, that is to say, a compendium of sorts. It is also true to say that the spirit of that standing order which says, "Give to the opposition critics the information upon which government decided to make legislative changes and show to the opposition critics the ramifications of the legislation; share with members of this House the reason for alterations to existing legislation or new laws that are proposed," is not here.

One has to be a believer in the government and in the budget to truly accept a piece of legislation like this. On the surface of it, one looks at a piece of legislation which appears simply to take current policies and provide a little more fairness. As we will see later on in some of the amendments, it is legislation designed to deal with a new size of pipe. Quite frankly, I do not believe that. I believe this is a source of revenue for the government. It is part of a general taxation policy which I do not support and which this party does not support.

Whatever merit might be found in this particular bill, and I would go so far to say there is some merit in the bill and some fairness involved in it and it does not seem to be a dramatic change, one must recognize that as the minister said in his opening remarks, there will be additional revenues gained here. It is not an insignificant amount of money that is being generated. It is virtually a doubling of the income to the province over the current situation. I think there are reasonable grounds for an opposition party like ours to oppose this bill.

If the government wants to have us well informed, if it wants to provide to opposition critics a compendium which shares with us all of their background information, then perhaps we will one day look at pieces of legislation such as this one and come to the same conclusions the government does. But it is not possible for us to do that so long as the government continues to provide us with pieces of paper which really do not tell us why a government is making legislative changes.

It is not our intention to speak at great length on this particular bill, but it is our intention to vote against it. If the government wants to get a slightly more balanced view of legislation on all sides of the House, then I would beg the government to do what the standing order calls for them to do, not just in name only but in the spirit of it. That is, to put together compendiums that do reflect how much money is involved and what problems the government has come across; to say what they are attempting to do with a given piece of legislation; to do all of those things in addition to providing us with, in this instance, really not a great deal more than what is printed in the bill itself.

Mr. Riddell: Mr. Speaker, I am cognizant of the fact that you are knowledgeable about these revenue bills that we are at present debating and am wondering if you would consider it in order for me to make some comments on the tax that is charged on land as it is transferred from owner to owner. Would that be in order?

Hon. Mr. Ashe: It really is not relevant at all.

Mr. Riddell: The Minister of Revenue says it is not relevant. I was going to try to draw the minister's attention to the millions of dollars that we are losing in this province in the land transfer tax. Since I am not allowed to speak on it now, maybe I will do it at another time.

The Acting Speaker (Mr. Cousens): I am sure the honourable minister will be most interested if it is a way of raising money.

Mr. Ruston: He always is.

The Acting Speaker: The next speaker is the member for Lake Nipigon.

Mr. Stokes: This is the kind of bill, Mr. Speaker, that has far-ranging repercussions on people who live in unorganized territories, particularly in northern Ontario. I would like to echo the sentiments expressed by the member for Rainy River (Mr. T. P. Reid) and the member for Oshawa (Mr. Breaugh), inasmuch as in the overall scheme of things there really is a dramatic increase in revenue as a result of amendments to the Provincial Land Tax Act.

I really do not know how that comes about. It was mentioned by the two members who spoke before me that the amendments are fairly specific with regard to the method of taxing pipelines and telephone and telegraph companies but is silent on whether or not this bill is a vehicle for changing the way in which provincial land tax is levied on those owners or tenants who happen to be occupying crown lands in unorganized municipalities.

The minister shakes his head in the negative to say that it has no effect on the assessment of anybody who happens to be a small entrepreneur who is conducting a business occupying land in unorganized territory, whether or not it is somebody who has a residence that occupies land in unorganized territory, or who happens to have a land-use permit in unorganized territory, or who happens to have a licence of occupation in unorganized territory.

If one reads the explanatory notes for this bill one would say that an owner or a taxpayer can also be just an ordinary tenant. They may not have security of tenure on this land in unorganized communities but they will be sent a notice of assessment in the same way as the owner. In many instances the owner is the crown and the taxpayer is a tenant by virtue of the fact that he may have a lease by way of a land-use permit or a licence of occupation.

That causes me problems, because there are a lot of people who live in unorganized territories who by the very nature of the land they occupy, whether it be by way of a parcel of land that was alienated from the crown or by way of patented mining claims, where in some instances they have the mining rights, in other instances they only have the surface rights, and in still other instances they have rights to everything except the pine trees growing on those lands because they were reserved for the British navy back in the 1800s.

5:10 p.m.

The minister smiles. I am sure he knows what I am talking about because, if he has land occupied by constituents of his without the benefit of municipal organization, he knows all the problems of tenure involved in deciding who the owner or tenant is for assessment purposes. I am sure this minister does not care a darn. What he will do is say, "This is the amount of money we want by way of this statute, the Provincial Land Tax Act." He does not much care whether he finds the owner or the tenant; as long as he has someone come up with the number of dollars he expects to get under this statute, it is fine and dandy.

It is mentioned in this bill that the owner or tenant no longer has the responsibility of reminding the minister he purchased the land, leases the land or now rents the land. I take it that is going to be the responsibility of the collector. It does not say definitely in this bill who the collector is. I know who the Treasurer is, I know who the minister is; I do not who the collector is. For purposes of enforcement of this bill, I suspect it will be the minister himself or somebody who is designated to perform that function.

It bothers me that, while the Minister of Revenue is now responsible for administering and collecting the provincial land tax, he is not really concerned about tenure or whether a person is the owner or just the tenant. That is still the responsibility of some other ministry, presumably the Ministry of Natural Resources, which had the responsibility in the past of collecting this tax.

It says in the explanatory notes: "The amendment to repeal the definition of 'owner' contained in clause 1(h) of the act is consequential on later amendments contained in the bill which are made to parallel provisions contained in the Assessment Act, whereby both an owner and tenant of land receive notice of assessment but, only the owner receives a bill for tax. The definition of 'owner' is replaced with a definition of 'tenant' by subsection 1(3) of the bill."

We know what the previous definition of owner was. That raised all kinds of problems. Having regard for the collection of funds under other statutes, I think of the Provincial Land Tax Act and the Crown Timber Act, that is administered by somebody else. We know about when somebody holds a licence in a territory without any municipal organization. We have literally tens of thousands of square miles where there is a levy, a land tax, placed on prime licence holders, such as Great Lakes Paper, Kimberly-Clark, Domtar and Abitibi-Price. They are taxed in a much different way.

I am wondering why there is not a clarification of all these things when we are talking about something as important as this, even if it is by way of allowing us, who represent northern ridings, to know where the $2.2 million is coming from now as opposed to the approximately $4.4 million that it is hoped to recover by the additional levies contained in this bill.

It is very difficult. My colleague says we are going to oppose this bill because, in general, we are opposed to the budgetary policy of this government. I know there are things contained in the budget that have necessitated amendments to this act as a means of collecting more revenue. On the surface, I personally would have to say that TransCanada PipeLines, which runs a natural gas pipeline through my riding, is a great means of collecting revenue, not by way of provincial land tax -- this government gets that -- but in terms of the economic benefits that accrue to groups of people in unorganized territories. It helps to sustain the local roads board in those small communities, it helps to sustain small schools in unorganized territories.

By way of an example, I want to refer to a small hamlet of about 200 people along Highway 11, between Nipigon and Geraldton. I was just talking to the secretary-treasurer of the local roads board --

Mr. Nixon: What's the name?

Mr. Stokes: Jellicoe; it is where they have the albino moose. The member saw that when he was there, did he not?

Mr. Nixon: Yes.

Mr. Stokes: By way of explanation and by way of illustrating my concerns about the lack of information, there is the fact that TransCanada PipeLines, according to this bill, is not going to be charged at the same rate for the twinning of its line, which it completed during the past winter, as long as it shares the existing right of way.

I ask the minister what effect this is going to have on those small communities that are able to collect revenue from TransCanada PipeLines and Bell Canada for the purpose of maintaining their little road structures under the Local Roads Board Act.

For every dollar that they generate locally by assessing themselves, they get two from the provincial government. For purposes of illustration, if they decided they needed $3,000 to maintain their little road structure in the hamlet of Jellicoe, they would have to raise only $1,000 by levying taxes on themselves, including small business, residential people there, TransCanada PipeLines and Bell Canada. If they were able to generate this $1,000, they would be able to get $2 for every $1, from the Ministry of Transportation and Communications.

5:20 p.m.

So while I do not want to oppose this bill on the surface, I really do not have enough information on which to make a reasonable judgement as to whether or not this is good, bad or indifferent. The assessment rolls are going to go to the board of education in Geraldton, which will say, "On the basis of this new assessment, the board of education is going to assess TransCanada PipeLines a certain amount of money for educational purposes."

I happen to know that the formula which is used right now is fairly good. When they wanted to close the little school in Jellicoe because it had an enrolment of only 26, we were able to prove to the board of education that operates the little school in Jellicoe that the amount of revenue that is collected and accrues to the Geraldton Board of Education as a result of TransCanada PipeLines having transmission lines through those two townships is more than it actually costs to operate the school.

If we had not been able to do that, the board of education would have had a very convincing argument for closing the school. But, aided and abetted by concerned parents in that little hamlet, I was able to prove that they collected more from TransCanada PipeLines and other taxpayers in this unorganized hamlet, so we persuaded them they should keep the school open.

I do not know what effect this is going to have. The minister, in his opening remarks, said they are going to make the assessment formula based on the inside diameter of the pipe which is used to carry the natural gas through these unorganized hamlets. He also said that the bill is going to have to be sent to committee, because he was not aware of the fact that they are now using 42-inch pipe as opposed to 38-inch pipe, which is the largest diameter that is contained in this schedule for oil transmission lines. These happen to be gas transmission lines with the same maximum diameter of 38 inches, at $26.70 per linear foot. But any twinning -- and we have got twinning there; I think there are some areas where there is a tripling of the line to increase the capacity -- is going to be at a much lower rate than the actual or the original line itself.

So it is very difficult for me to be able to say to the people of Jellicoe and all of the small, unorganized hamlets what the effect of this bill will be. I am sure the minister cannot tell me, and I can readily appreciate why he cannot tell me. But that is why it is so important for me, as the elected member for Lake Nipigon, to be able to come into this House and say something about this bill, whether it is good, whether it is bad or whether it is indifferent; and I cannot do that, because I do not have the information that is required to make this kind of judgement.

I wonder what effect section 7 of this bill that amends the act is going to have. The minister is changing the formula as it applies for provincial land tax purposes in areas without any municipal organization, that is in unorganized territory. They are not going to do it on the basis of the existing formula. They are going to do it on a new annual tax of an amount equal to five per cent of the total gross receipts of telephone and telegraph companies, resulting from business carried on in a territory without municipal organization.

There again, I cannot tell. If they are going to do it on the basis of moneys that are generated, say in the little town of Jellicoe that accrue to Bell Canada, they could say, "It was $1.49 today." I do not know if they are going to do it on the basis of what it costs for maybe half a dozen people to be on a party line or something of this nature.

I just called Jellicoe. I had to get in touch with the operator and I wanted to talk to Mrs. Neil Arthur, who is the secretary-treasurer of the local roads board so I could remind myself about how they organize themselves and finance things. I had to get the operator. Her number is 54 in Jellicoe.

I am wondering what effect this amendment to the provincial land tax will have on the assessment. Whether it is the board of education in Geraldton or the little local roads boards in Jellicoe that will be using their assessment roll, what kind of effect is that going to have on their ability to generate revenue for very legitimate reasons? They do not have the right to tax the storekeeper or the gas pump operator or the tourist operator. They have only the education and the local roads board tax.

On the surface of it, if it is something that will increase the revenue for the province for something that seems to be quite legitimate, and if it will not have an undue impact upon the residents of Jellicoe, the Geraldton Board of Education and the little local roads board, I would be inclined to support this bill, but I cannot make that judgement simply because I do not have enough information. Perhaps the minister will be able to tell me all about it.

There is only one other thing that really bothers me about this act. It has something to do with a right of appeal. In section 3, it says, "The amendment provides that notices of assessment are to be sent to both the owner and the tenant of land as is provided for in the Assessment Act."

It says, "The collector may at any time assess or amend the assessment of any land liable to assessment and taxation under this act and shall forthwith notify the owner of the land of the assessment or the amendment."

If that is done, I want to be assured that the owner, who may be a residential owner or a small commercial operator -- or, for that matter, in the interests of fairness and justice, TransCanada PipeLines or Bell Canada -- will have the same right of appeal as it pertains to assessment in unorganized territory as he would have in organized territory. That would satisfy one of my concerns.

There is no reference in there that I could discern about that right of appeal. It may be in the original act, although this seems to be a new section defining what a collector is. That is the way the old act reads, but there is no reference to it in the explanatory notes. I did not go through the original act, but I want to be assured there is that right of appeal there.

5:30 p.m.

Mr. Nixon: Mr. Speaker, I hope the minister was listening to the problems put forward by the member for Lake Nipigon about the difficulty in understanding the intent and ramifications of this legislation.

My colleague the member from Fort Frances has already indicated his dissatisfaction with what the government chooses to call the accompanying compendium which is required under the rule. The minister must agree that the explanatory notes of this bill do not explain very much. They are just about as dense as anything we would want to wade through.

Fortunately, I was able to consult an unimpeachable source on the ramifications of the bill. If that unimpeachable source were complete in giving me some indication of its meaning, it does seem strange that the New Democratic Party is constrained to vote against the bill.

Surely the only people who would be in opposition to the bill would be TransCanada PipeLines since it appears the taxes they have been paying on crown lands are only about a fifth of what they pay in organized territory. It does not seem proper that they should be allowed to get away practically scot-free. The indications are that they were paying less than $500,000 in taxes on their enormous gas pipeline, and that amount will be raised to about $2 million if this bill goes through.

I have a lot of sympathy for the member for Lake Nipigon, whose main interest, and very properly so, is seeing that these small communities are going to get their fair share of the revenue from the fantastic amount of energy that goes swooshing through these pipelines to feed the industry of the areas down east, meaning us.

Mr. Stokes: And cutting huge swaths through the bush to accommodate them.

Mr. Nixon: Yes, right. I hope the minister can give us that assurance.

My main criticism directed to the minister has already been put forward by the member for Rainy River. We should have a compendium that explains in understandable terms just what the ramifications of the bill actually are. The source I consulted indicated there is going to be a tremendous change in the methods of land taxation in unorganized territories and that many of the users of those lands, the pipelines and so on, will have to face the kind of up-to-date taxation that we have been calling for when we have insisted that government revenues in this connection have been inadequate.

I am very glad the member for Rainy River has indicated we will support the bill, but I can understand the problem faced by all members, including northern members in support of the Conservative Party, in understanding what the ramifications are. We are supporting the bill, and my colleague has indicated that is so, because I believe we should be getting additional revenues on a land tax basis from the utilization of crown land by TransCanada PipeLines in particular and perhaps from certain other sources.

Mr. Haggerty: Mr. Speaker, I want to address myself to Bill 113, An Act to amend the Provincial Land Tax Act. If I can interpret the act, I suppose it parallels existing legislation under the Assessment Act applying to incorporated municipalities and will apply to unorganized municipalities.

I want to support my colleague the member for Lake Nipigon in his concerns about the revenue that will be generated from the government's new land tax policy. I hope the revenues that are generated in unorganized areas of northern Ontario will go back to those unorganized hamlets and that the assistance given to them will provide all the amenities found in southern Ontario. For example, they could support the local school boards and local road boards. I think it is important that this money is returned to the municipality.

I have another reservation that I think has been mentioned by other members. It is the concern about rate scheduling on assessment per foot of length of pipeline. I suppose we are talking about steel pipe. I imagine that is what it is, but the gas companies today are using plastic pipe to install local services from the larger main to the residents requiring the services. There is nothing mentioned about plastic pipe installation here at all.

It only goes to size 38- or 36-inch pipe and I look at the ratio assessment per foot of length, which is from 14 inches to 42. With 36-inch, the increase in the flow in that alone will be an enormous amount of carrying capacity. The volume will be tremendous. Perhaps we should be looking at the $4.72 assessment per foot. Perhaps it is not a sufficient rating on an assessment basis. When the minister is reviewing that, he should look at that area. I do not think it is assessed at the level it should be.

The explanatory note on section 6 quotes subsection 10(3), "A pipe installed before 1940 shall be assessed for taxation at the rates set forth in subsection 2 but shall be depreciated up to the year 1940 at the rate of two per cent per annum of assessed value of the pipeline, with a maximum depreciation of 50 per cent." I hesitate to support that particular clause, because any gas pipeline that has been laid down for a period of almost 41 years would not meet the requirements under any safety regulations of the Ontario Energy Board today. If the minister is listening to this, I hope he will realize there is no consideration about the safety of these old lines.

Subsection 10(5) reads, "A pipeline removed from one location and re-installed in another location shall, where depreciation is applicable, continue to be depreciated in accordance with subsection 3 as though remaining in its original location."

Those two clauses, if I am interpreting them correctly, say that old pipeline is going to be removed and installed somewhere else. The pipeline is obsolete and does not meet the safety requirements provided under the Ontario Energy Board. If a new line is going to be installed to replace it, then it should be assessed at the present market value of the pipeline. I suggest those two clauses do not seem to be right.

Subsection 10(3) reads, "Where a pipeline is located on, in, under, along or across a highway or any lands, other than lands held in trust for a band or body of Indians, exempt from taxation under this or any special or general act, the pipeline is nevertheless liable to assessment and taxation in accordance with this section." Where any pipeline goes across an Indian reservation or Indian lands, the Indians should be entitled to the revenue generated through the Assessment Act. It does not say they are going to be reimbursed at all.

Another area of concern is, if I can go back to the budget statement: "Telephone and telegraph companies will pay tax equal to five per cent of gross receipts in areas without municipal organization. The definition of gross receipts will parallel that in the Municipal Act." I think we support that on this side of the House.

5:40 p.m.

The budget also says, "The assessment of telephone and telegraph wire mileage will be discontinued." I cannot understand why the government would want to discontinue mileage on telephones and telegraphs. I am sure the minister is well aware of the policy of Bell Canada in southern Ontario, which is that if one lives in a municipality that is five, six or 10 miles from a telephone exchange system, one pays additional costs for the telephone service by paying mileage. This is an area where Bell Canada is generating additional revenue.

I live in Sherkston and the exchange is about four or five miles away. It costs me quite a bit for the telephone line to my residence. I suggest it is an area where Bell Canada is reaping huge profits, particularly in relation to what might be called rural municipalities. Fort Erie is no longer a rural municipality, it is no longer a township, so I see no reason why there should be this extra tax on local bills for mileage charged by Bell Canada.

If that continues, I suggest the proposed deletion under the amendments to the act, the assessment on telephone and telegraph wire mileage, be continued because they are certainly generating additional revenue beyond the five per cent permitted now under the Assessment Act.

I bring these to the minister's attention. Other members may find it rather difficult to follow the intent of all the proposed amendments under the bill. We support it in principle because it will generate additional revenue that will be passed on to areas of unorganized municipalities, hamlets or whatever they may be in other places in Ontario, particularly northern Ontario.

They are entitled to that revenue and I support the member for Lake Nipigon in his approach to the solution to the bill, that the revenue should flow to those hamlets in northern Ontario.

Hon. Mr. Ashe: Mr. Speaker, I will attempt in the next few minutes to answer all the points and questions raised by the members.

First, in the 1980-81 fiscal year, which is the last one we have final figures for, the Provincial Land Tax Act raised a grand total of $2.1 million. That was it. That was from all sources. Let me assure the member for Erie that the government ploughed back into those unorganized territories much in excess of the $2.1 million. There is no doubt about that at all.

Mr. Haggerty: You are generating a lot of revenue from other sources.

Hon. Mr. Ashe: I am not sure that is particularly relevant.

Let me clarify where this bill really has relevance at this point. There could be other companies in the future, but this bill has impact upon TransCanada PipeLines, Norcen Energy Resources Ltd., Bell Canada and Northern Telephone Ltd. That is all.

Mr. Kerrio: What about hydro lines? Are you going to tax those?

Hon. Mr. Ashe: No, those really are the changes.

There is no doubt there will be significant impact on the pipelines, particularly TransCanada PipeLines. It is at present paying in total about $500,000 and that would rise to about $1.9 million, including the new pipelines laid in 1982. Keep in mind this is only coming into effect January 1, 1983.

Currently, in the context of the telephone companies, based on the mileage charges for wire, the revenue derived is virtually insignificant. It is only a few thousand dollars. Under this proposal they will be paying, based on five per cent of gross revenues from the area served, a total estimated at about $600,000.

If one puts that into the context of what the telephone companies now pay to the organized municipalities, something in the area of $105 million, one sees it is a relatively insignificant part of their total tax expenses but still a more meaningful increase in relation to other organizations that operate in both organized and unorganized territories.

The question was asked about the status of a collector and who is a collector. A collector under the Provincial Land Tax Act, as I am told, is appointed by order in council. It is currently an officer in the assessment division of the ministry; this function can be exercised by other Ministry of Revenue officials by the delegation of authority by regulation to the act, and that delegation includes the minister, the deputy minister and directors in that context. That really is what a collector is.

Is there any change to other properties? Directly, in the tax impositions here, no. Is there any potential additional revenue for service boards, roads boards, etc.? The answer to that is yes, there will be additional opportunities for revenues. This in itself will not have any effect on school boards, because their assessment roll comes under the Assessment Act and not under the Provincial Land Tax Act, so there will not be any change as far as school boards are concerned from this bill itself. I hope that answers those questions.

I was asked about the reasons for the amendments. We just put a bill in a month or so ago and now we are amending it. Yes, one of the amendments, frankly, is because we did not know there was any 42-inch pipeline. There are 42-inch pipelines being built, and we are now recognizing that. I might say that the sizes of pipelines now in existence are two, four, eight, 10, 12 -- also three for TransCanada PipeLines -- 30, 36 and now 42, so the one amendment will recognize the new 42-inch pipeline.

The second amendment was drawn to our attention because without the allowance for depreciation that is being incorporated in one of these amendments we would end up with some of these pipelines paying more tax than in organized areas, and that was never the intent of the bill; it was to bring the tax paid on pipelines going through unorganized areas to approximately the same as that paid on pipelines going through organized areas. Keep in mind that a pipeline is a pipeline, and it really does not recognize whether there is an organized municipality or an unorganized area. As has already been pointed out, pipelines are now paying roughly a quarter to a fifth of the taxation in the unorganized areas.

There was a comment that the change in the amount of penalty is too high. Let me put this into the proper context of what we are talking about. First, if we set aside the telephone company and the pipelines, the average provincial land tax bill is something on the order of $20 to $30. Believe it or not, there is even a significant number of bills that are the minimum of $6.

The previous penalty of five per cent meant that for those people who did not bother to pay their bills, for whatever reason -- even these relatively insignificant sums -- the late penalty amounted to 30 cents, $1 or $1.50. What we are trying to do by increasing the penalty to 10 per cent with a $6 minimum is to encourage people, frankly, to pay their taxes on time. The actual dollar penalties are still relatively insignificant, because the total amount of the bill is also relatively insignificant. So this puts the reason for the increased penalty into proper perspective, as well as the actual financial implications of that increased penalty. Both are relatively insignificant.

5:50 p.m.

Next year, the bill will raise the interest rate payable on any overdue taxes to make it coincidental and the same as other taxing statutes. That will take effect only during the next fiscal year. Any taxes outstanding at that time will carry the same rate of interest as other taxing statutes and the six per cent will no longer be available. I think the honourable members would agree that six per cent interest today is really far from reality and only encourages the nonpayment of liabilities.

Mr. Stokes: So does 10 per cent.

Hon. Mr. Ashe: I say to the member for Lake Nipigon that the 10 per cent is the overdue penalty. The other change will be to the current rate of interest. It is the same as income tax. If one files late, there is an immediate next-day penalty and one starts paying interest. That is exactly what this is doing as well.

Mr. Cooke: What is the rate?

Hon. Mr. Ashe: The penalty, which previously was five per cent with no minimum, is being changed to 10 per cent with a $6 minimum, keeping in mind that many of the bills are relatively insignificant in themselves. Frankly, it is just to encourage people to pay on time.

I am just going down the notes I have made. I think I have answered all of the points raised. Again, I want to put the total numbers we are talking about into context. The bill will impact on only six companies at this time. I say that because there could be future pipeline companies which are different from the ones that are now traversing the land in northern Ontario.

There is no doubt that in terms of the total revenue to the province there is a significant increase from the $2.1 million previously, but it all comes from four companies; namely, the two pipeline companies I named, as well as Bell Canada and Northern Telephone Ltd.

The Deputy Speaker: Hon. Mr. Ashe has moved second reading of Bill 113, An Act to amend the Provincial Land Tax Act.

All those in favour of the motion will please say "aye."

All those opposed will please say "nay."

In my opinion the ayes have it.

Vote stacked.

TOBACCO TAX AMENDMENT ACT

Hon. Mr. Ashe moved second reading of Bill 112, An Act to amend the Tobacco Tax Act.

Hon. Mr. Ashe: Mr. Speaker, this bill to amend the Tobacco Tax Act will implement the proposals announced in the Treasurer's (Mr. F. S. Miller) budget of May 13, 1982, which increased the tax rates applicable to cigarettes and tobacco other than cigars.

In addition, other changes will increase the amount of compensation and establish an inventory shrinkage allowance. The ad valorem tax rate for cigarettes has been increased to 40 per cent of the taxable price from a rate of 36 per cent. The tax rate for tobacco other than cigarettes and cigars has also been increased to 40 per cent of the taxable price from a rate of 30 per cent.

The tax rate applicable to cigars remains unchanged at 45 per cent of the retail price.

The maximum compensation available to designated tobacco tax collectors in any fiscal year will be increased to $2,000 from $1,000. This change will be effective for the fiscal year beginning April 1, 1982.

I am aware that because of the nature of the products handled by tobacco tax collectors, they experience certain inventory losses which are often unidentifiable as to cause and therefore cannot be recovered by collectors through normal channels. The value of the lost inventory contains an element of tax because of the way in which the Tobacco Tax Act is applied to tobacco products. To this point, this tax has been absorbed by the collectors.

For that reason, designated tobacco tax collectors will be able to claim a shrinkage allowance of not more than 1/10 of one per cent of the tobacco tax collected and remitted each month. This change will be effective from June 1, 1982.

In this bill I have also included an administrative amendment designed to protect for the province the tobacco tax revenue associated with the tax portion of collectors' accounts receivable assigned as collateral.

Mr. Nixon: Mr. Speaker, I want to speak on behalf of my constituents who grow the raw material, the tobacco that goes into these cigarettes -- not cigars, although perhaps some of it goes into cigars -- and who feel that 40 per cent tax on their product is unreasonably high. It is difficult to know just what the limit should be. It is difficult even to determine that because in budget after budget the government edges the tax up more and more.

Usually there is very little objection. I suppose many of the people who smoke feel a little guilty about it since they keep reading in the paper that they should not be doing it and somebody at home is probably telling them they should stop. It is amazing that we do not get more objection from the smokers, the people who buy the cigarettes and cigars, since the tax level of 40 per cent is really reaching the unconscionable level. The revenue increase is --

Mr. Stokes: It is like booze.

Mr. Nixon: Yes, very much like booze. In this instance the government buys the liquor cheap, waters it down and sells it dear through its own stores. After the markup, it slaps on the tax. This is before the federal government even touches it.

In some countries the government has a monopoly on the sale of cigarettes, just as we have a monopoly on the sale of liquor. One of the countries in Europe does this -- France, I believe.

Mr. Di Santo: Italy.

Mr. Nixon: I am advised by my good friend the member for Downsview that it is Italy. It goes back to those palmy years in the 1930s when the government of Italy was looking for additional revenue.

I am concerned particularly that this tax is interfering with the livelihood of my constituents. Those who are interested in this matter, and I would think that includes everyone in the House, should certainly read this week's issue of Saturday Night magazine, which has a magnificent article on the tobacco country in southwestern Ontario. It points out that the largest percentage of the flue-cured tobacco grown and sold in Canada comes from an area within about 25 miles of the town of Delhi, which I have the honour to represent along with my colleague the member for Haldimand-Norfolk (Mr. G. I. Miller) and to a lesser extent our good friend the member for Elgin (Mr. McNeil).

The tobacco business down there is a very large one indeed. In many respects the tobacco farmers have an opportunity to make more per acre than any other farmers in Canada. They also take substantial risks, work very hard and have a huge investment of capital.

Mr. Speaker, I would like to tell you a bit more about this when we return after the dinner hour.

The Deputy Speaker: We would all love to hear about it.

The House recessed at 6 p.m.

22 juin 1982